Document:

<PAGE>
                                                                  Exhibit 10.22

                                                                [EXECUTION COPY]

                     AMENDMENT AGREEMENT TO CREDIT AGREEMENT

      Amendment Agreement to Credit Agreement, dated as of March 17, 2000 (this
"Amendment Agreement"), among DUANE READE, a New York general partnership (the
"Borrower"), DUANE READE INC., a Delaware corporation ("Holdings"), DRI I INC.,
a Delaware corporation ("DRI I" and, together with Holdings, collectively, the
"Parent Guarantors"), DUANE READE INTERNATIONAL, INC., a Delaware corporation
("Duane Reade IP") DUANE READE REALTY, INC., a Delaware corporation ("Duane
Reade Realty" and together with Duane Reade IP, collectively, the "Affiliate
Guarantors" and, together with the Parent Guarantors, collectively, the
"Designated Guarantors"), the various financial institutions as are or may
become parties hereto (collectively, the "Lenders"), DLJ CAPITAL FUNDING, INC.
("DLJ"), as syndication agent (in such capacity, the "Syndication Agent") for
the Lenders, FLEET NATIONAL BANK ("Fleet"), as administrative agent (in such
capacity, the "Administrative Agent") for the Lenders and CREDIT LYONNAIS NEW
YORK BRANCH ("Credit Lyonnais"), as the documentation agent (in such capacity,
the "Documentation Agent") for the Lenders.

                              W I T N E S S E T H:

      WHEREAS, pursuant to the Second Amended and Restated Credit Agreement,
dated as of March 17, 1999 (together with all Loan Documents (as defined
therein), in each case as amended prior to the date hereof, the "Existing Credit
Agreement"), among the Borrower, the Designated Guarantors, the various
financial institutions party thereto (collectively, the "Existing Lenders"), the
Syndication Agent, the Administrative Agent and the Documentation Agent, the
Existing Lenders made and were committed to make Credit Extensions to the
Borrower on the terms and conditions set forth therein;

      WHEREAS, the Borrower and Designated Guarantors have requested, and the
Lenders have agreed, subject to the terms and conditions hereinafter set forth,
to amend and restate the Existing Credit Agreement (together with all schedules
and exhibits thereto) in its entirety in the form of the Third Amended and
Restated Credit Agreement (as defined below);

      NOW, THEREFORE, in consideration of the agreements herein contained, the
parties hereto hereby agree as follows:
<PAGE>

                                    ARTICLE I

                                   DEFINITIONS

      SECTION 1.1. Certain Definitions. The following terms (whether or not
underscored) when used in this Amendment shall have the following meanings (such
meanings to be equally applicable to the singular and plural form thereof):

      "Affiliate Guarantors" is defined in the preamble.

      "Amendment Agreement" is defined in the preamble.

      "Amendment Effective Date" is defined in Section 3.1.

      "Borrower" is defined in the preamble.

      "Credit Agreement" is defined in the first recital.

      "Designated Guarantors" is defined in preamble.

      "DRI I" is defined in the preamble.

      "Duane Reade IP" is defined in preamble.

      "Duane Reade Realty" is defined in preamble.

      "Existing Credit Agreement" is defined in the first recital.

      "Holdings" is defined in the preamble.

      "Parent Guarantors" is defined in the preamble.

      "Third Amended and Restated Credit Agreement" is defined in Section 2.1.

      SECTION 1.2. Other Definitions. Terms for which meanings are provided in
the Third Amended and Restated Credit Agreement are, unless otherwise defined
herein or the context otherwise requires, used in this Amendment Agreement with
such meanings.

                                       -2-
<PAGE>

                                   ARTICLE II

                            AMENDMENT AND RESTATEMENT
                          OF EXISTING CREDIT AGREEMENT

      SECTION 2.1. Amendment and Restatement of Existing Credit Agreement. On
the Amendment Effective Date, the Existing Credit Agreement (including all
schedules and exhibits thereto) shall be and is hereby amended and restated to
read in its entirety as set forth in Annex I hereto (as set forth in such Annex
I, the "Third Amended and Restated Credit Agreement"), and as so amended and
restated is hereby ratified, approved and confirmed in each and every respect.
The rights and obligations of the parties to the Existing Credit Agreement with
respect to the period prior to the Amendment Effective Date shall not be
affected by such amendment and restatement.

                                   ARTICLE III

                           CONDITIONS TO EFFECTIVENESS

      SECTION 3.1. Amendment Effective Date; Conditions Precedent to Borrowing
of Additional Term C Loans. This Amendment Agreement (and the amendments and
modifications contained herein) shall become effective on the date (the
"Amendment Effective Date") when each of the conditions set forth in this
Article III shall have been fulfilled to the reasonable satisfaction of the
Agents. The obligation of each Lender having an Additional Term C Loan
Commitment to make the initial Additional Term C Loan shall be subject to the
prior or concurrent satisfaction of each of the conditions precedent set forth
in this Article in addition to those set forth in Section 5.1 of the Third
Amended and Restated Credit Agreement.

      SECTION 3.1.1. Execution of Counterparts. The Agents shall have received
executed counterparts of this Amendment Agreement, duly executed and delivered
on behalf of each of the Borrower, the Designated Guarantors, the Agents and the
Required Lenders (which shall include (a) those Lenders having greater than 50%
of the Revolving Loan Commitments prior to the Amendment Effective Date, (b)
those Lenders holding greater than 50% of the aggregate amount of the Loans
outstanding under the Term C Loans and (c) each Lender that has an Additional
Term C Loan Commitment, if any).

      SECTION 3.1.2. Resolutions, etc. The Agents shall have received, with a
copy for each Lender, from each Obligor a certificate, dated the Amendment
Effective Date, of its Secretary, Assistant Secretary or general partners, as
applicable, as to (i) resolutions of its Board of Directors or all partnership
action, as applicable, then in full force and effect authorizing the execution,
delivery and performance of this Amendment Agreement, (ii) the incumbency and
signatures of those of its officers or general partners, as applicable,
authorized to act with respect to this Amendment Agreement and

                                       -3-
<PAGE>

each such other Loan Document executed by it and (iii) the full force and
validity of its Organic Documents and true and complete copies of all amendments
thereto since December 16, 1999, upon which certificate each Agent, the
Documentation Agent, the Issuer and each Lender may conclusively rely until it
shall have received a further certificate of the Secretary, Assistant Secretary
or general partners, as applicable, of such Obligor canceling or amending such
prior certificate.

      SECTION 3.1.3. Opinion of Counsel. The Agents shall have received an
opinion, dated the Amendment Effective Date and addressed to the Agents, the
Documentation Agent and all of the Lenders from Latham & Watkins, special New
York counsel to each of the Obligors, in form and substance reasonably
satisfactory to the Agents and its counsel.

      SECTION 3.1.4. Amendment Fee. The Agents shall have received, (a) for the
account of each Lender that delivers an executed signature page to the Amendment
Agreement to the Syndication Agent prior to 5:00 p.m., New York City time, March
14, 2000, an amendment fee in an amount equal to .125% of the sum of (i) the
outstanding principal amount of Term Loans owing to such Lender on such date
plus (ii) the product of such Lender's Percentage of the Commitment to make
Revolving Loans multiplied by the Revolving Loan Commitment Amount on such date
and (b) all fees, costs and expenses due and payable pursuant to Sections 3.3
and 11.3 of the Credit Agreement to the extent then invoiced.

      SECTION 3.1.5. Satisfactory Legal Form. All documents executed or
submitted pursuant hereto by or on behalf of the Borrower or any of its
Subsidiaries or any other Obligors shall be satisfactory in form and substance
to the Agents and their counsel. The Agents and their counsel shall have
received all information, approvals, opinions, documents or instruments as the
Agents or their counsel may reasonably request.

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

      SECTION 4.1. Representations and Warranties. In order to induce the
Lenders to execute and deliver this Amendment Agreement, each of the Borrower
and each Designated Guarantor hereby represents and warrants as set forth below:

            (a) After giving effect to this Amendment Agreement, the amendment
      of the Existing Credit Agreement does not impair the validity,
      effectiveness or priority of the Liens granted pursuant to the Pledge
      Agreement and the Security Agreement (as such terms are defined in the
      Existing Credit Agreement, collectively, the "Security Documents"), and
      such Liens continue unimpaired with the same priority to secure repayment
      of all Obligations, whether heretofore or hereafter incurred. Neither the
      amendment of the Existing Credit Agreement effected pursuant to this
      Amendment Agreement nor the execution, delivery, performance or
      effectiveness of this

                                       -4-
<PAGE>

      Amendment Agreement requires that any new filings be made or other action
      taken to perfect or to maintain the perfection of such Liens. The position
      of the Lenders with respect to such Liens, the Collateral (as defined in
      the Security Documents) in which a security interest was granted pursuant
      to the Security Documents, and the ability of the Administrative Agent to
      realize upon such Liens pursuant to the terms of the Security Documents
      have not been adversely affected in any material respect by the amendment
      of the Existing Credit Agreement effected pursuant to this Amendment
      Agreement or by the execution, delivery, performance or effectiveness of
      this Amendment Agreement.

            (b) Each Obligor reaffirms as of the Amendment Effective Date such
      Person's respective covenants and agreements contained in the Credit
      Agreement, each Security Agreement and each Pledge Agreement to which such
      Person is a party, including, in each case, as such covenants and
      agreements may be modified by the Amendment Agreement. Each such Obligor
      further confirms that each such Loan Document to which such Person is a
      party is and shall continue to be in full force and effect and the same
      are hereby ratified, approved and confirmed in all respects, except that
      upon the occurrence of the Amendment Effective Date, all references in
      such Loan Documents to the "Credit Agreement", "Loan Documents",
      "thereunder", "thereof", "therein" or words of like or similar import
      shall mean and be a reference to the Credit Agreement and the Loan
      Documents (as such term is defined in the Credit Agreement).

            (c) Both before and immediately after giving effect to this
      Amendment Agreement,

                  (i) the representations and warranties set forth in Article VI
            of the Credit Agreement (excluding, however, those contained in
            Section 6.7 of the Credit Agreement) and each other Loan Document
            are, in each case, true and correct (unless stated to relate solely
            to an earlier date, in which case such representations and
            warranties shall be true and correct as of such earlier date);

                  (ii) except as disclosed by the Borrower or any Parent
            Guarantor to the Agents, the Documentation Agent and the Lenders
            pursuant to Section 6.7 of the Credit Agreement

                        (A) no labor controversy, litigation, arbitration or
                  governmental investigation or proceeding (including any
                  relating to any Pharmaceutical Law) is pending or, to the
                  knowledge of the Borrower or any Parent Guarantor, threatened
                  against the Borrower, any Parent Guarantor or any of their
                  respective Subsidiaries which could reasonably be expected to
                  have a Material Adverse Effect or which purports to affect the
                  legality, validity or enforceability of this Second Amendment,
                  the Credit Agreement, the Notes or any other Loan Document;
                  and

                                      -5-
<PAGE>

                        (B) no development has occurred in any labor
                  controversy, litigation, arbitration or governmental
                  investigation or proceeding (including any relating to any
                  Pharmaceutical Law) disclosed pursuant to Section 6.7 of the
                  Credit Agreement which could reasonably be expected to have a
                  Material Adverse Effect; and

                  (iii) no Default has (or will have) occurred and is (or will
            be) continuing, and neither the Borrower, any Parent Guarantor nor
            any of their respective Subsidiaries are in material violation of
            any law or governmental regulation or court order or decree
            (including any Pharmaceutical Law).

                                    ARTICLE V

                                  MISCELLANEOUS

      SECTION 5.1. Cross-References. References in this Amendment Agreement to
any Article or Section are, unless otherwise specified or otherwise required by
the context, to such Article or Section of this Amendment Agreement.

      SECTION 5.2. Loan Document Pursuant to Credit Agreement. This Amendment
Agreement is a Loan Document executed pursuant to the Third Amended and Restated
Credit Agreement and shall be construed, administered and applied in accordance
with all of the terms and provisions of the Third Amended and Restated Credit
Agreement.

      SECTION 5.3. Successors and Assigns. This Amendment Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors and assigns.

      SECTION 5.4. Counterparts. This Amendment Agreement may be executed by the
parties hereto in several counterparts, each of which when executed and
delivered shall be deemed to be an original and all of which shall constitute
together but one and the same agreement.

      SECTION 5.5. Governing Law. THIS AMENDMENT AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      -6-
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

      IN WITNESS WHEREOF, the signatories hereto have caused this Amendment
Agreement to be executed by their respective officers thereunto duly authorized
as of the day and year first above written.

                                    BORROWER:
                                    DUANE READE
                                    By Duane Reade Inc., a general partner

                                       By____________________________________
                                         Title:

                                    By DRI I Inc., a general partner

                                       By____________________________________
                                         Title:

                                    PARENT GUARANTORS:
                                    DUANE READE INC.

                                       By____________________________________
                                         Title:

                                    DRI I INC.

                                       By____________________________________
                                         Title:

                                       S-1
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    AFFILIATE GUARANTORS:
                                    DUANE READE INTERNATIONAL, INC.

                                    By____________________________________
                                      Title:

                                    DUANE READE REALTY, INC.

                                    By____________________________________
                                      Title:

                                       S-2
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    DLJ CAPITAL FUNDING, INC., as the
                                       Syndication Agent and as a Lender

                                    By____________________________________
                                      Title:

                                       S-3
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    FLEET NATIONAL BANK, as the Administrative
                                       Agent and as a Lender

                                    By____________________________________
                                      Title:

                                       S-4
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    CREDIT LYONNAIS NEW YORK BRANCH, as
                                       the Documentation Agent and as a Lender

                                    By____________________________________
                                      Title:

                                       S-5
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    LENDERS:

                                    SUMMIT BANK

                                    By____________________________________
                                      Title:

                                       S-6
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    BHF (USA) CAPITAL CORPORATION

                                    By____________________________________
                                      Title:

                                    By____________________________________
                                      Title:

                                    BALANCED HIGH-YIELD FUND II LTD.,
                                       By: BHF (USA) CAPITAL CORPORATION,
                                       acting as attorney-in-fact

                                    By____________________________________
                                      Title:

                                    By____________________________________
                                      Title:

                                       S-7
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    HELLER FINANCIAL, INC.

                                    By____________________________________
                                      Title:

                                       S-8
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    ORIX USA CORPORATION

                                    By____________________________________
                                      Title:

                                       S-9
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    OSPREY INVESTMENTS PORTFOLIO
                                    By Citibank, N.A., as Manager

                                    By____________________________________
                                      Title:

                                    STRATEGIC MANAGED LOAN PORTFOLIO
                                    By Citibank, N.A., as Manager

                                    By____________________________________
                                      Title:

                                      S-10
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    MORGAN STANLEY DEAN WITTER PRIME
                                       INCOME TRUST

                                    By____________________________________
                                      Title:

                                      S-11
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    VAN KAMPEN CLO I, LIMITED
                                    By Van Kampen Management, Inc., as
                                          Collateral Manager

                                    By____________________________________
                                      Title:

                                    VAN KAMPEN SENIOR FLOATING RATE FUND By Van
                                    Kampen Investment Advisory Corp.

                                    By____________________________________
                                      Title:

                                    VAN KAMPEN PRIME RATE INCOME TRUST By Van
                                    Kampen Investment Advisory Corp.

                                    By____________________________________
                                      Title:

                                      S-12
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    Merrill Lynch Global Investment Series:
                                       INCOME STRATEGIES PORTFOLIO
                                    By Merrill Lynch Asset Management, L.P., as
                                          Investment Advisor

                                    By____________________________________
                                      Title:

                                    MERRILL LYNCH DEBT STRATEGIES
                                       PORTFOLIO
                                    By Merrill Lynch Asset Management, L.P., as
                                          Investment Advisor

                                    By____________________________________
                                      Title:

                                    MERRILL LYNCH PRIME RATE PORTFOLIO
                                    By Merrill Lynch Asset Management, L.P., as
                                          Investment Advisor

                                    By____________________________________
                                      Title:

                                    DEBT STRATEGIES FUND, INC.

                                    By____________________________________
                                      Title:

                                    MERRILL LYNCH SENIOR FLOATING RATE
                                       FUND, INC.

                                    By____________________________________
                                      Title:

                                    MERRILL LYNCH SENIOR FLOATING RATE
                                       FUND II, INC.

                                      S-13
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    By____________________________________
                                      Title:

                                    SENIOR DEBT PORTFOLIO
                                       By: Boston Management and Research, as
                                          Investment Advisor

                                    By____________________________________
                                      Title:

                                    EATON VANCE INSTITUTIONAL SENIOR
                                    LOAN FUND
                                       By: Eaton Vance Management, as Investment
                                          Advisor

                                    By____________________________________
                                      Title:

                                    EATON VANCE SENIOR INCOME TRUST
                                       By: Eaton Vance Management, as Investment
                                          Advisor

                                    By____________________________________
                                      Title:

                                    OXFORD STRATEGIC INCOME FUND
                                       By: Eaton Vance Management, as Investment
                                          Advisor

                                    By____________________________________
                                      Title:

                                      S-14
<PAGE>

              Signature Page to Duane Reade Amendment Agreement

                                    KZH PAMCO LLC

                                    By____________________________________
                                      Title:

                                      S-15
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    CAPTIVA III FINANCE LTD., as advised by
                                       Pacific Investment Management Company

                                    By____________________________________
                                      Title:

                                      S-16
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    THE CHASE MANHATTAN BANK

                                    By____________________________________
                                      Title:

                                      S-17
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    ATHENA CDO, Limited
                                    By: Pacific Investment Management Company,
                                        as its Investment Advisor
                                    By: PIMCO Management Inc., a general partner

                                    By____________________________________
                                      Title:

                                      S-18
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    THE FUJI BANK, LTD.

                                    By____________________________________
                                      Title:

                                    MOUNTAIN CAPITAL CLO I, LTD.

                                    By____________________________________
                                      Title:

                                      S-19
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    CLYDESDALE CBO I, LTD.
                                    By Nomura Corporate Research and Asset
                                    Management Inc. as Investment Advisor

                                    By____________________________________
                                      Title:

                                      S-20
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    STEIN ROE FLOATING RATE LIMITED LIABILITY
                                    COMPANY
                                    By Stein Roe & Farnham Incorporated as
                                       advisor

                                    By____________________________________
                                      Title:

                                    LIBERTY STEIN ROE ADVISOR FLOATING
                                    RATE ADVANTAGE FUND
                                    By Stein Roe & Farnham Incorporated as
                                       advisor

                                    By____________________________________
                                      Title:

                                      S-21
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    FLOATING RATE PORTFOLIO
                                    By Invesco Senior Secured Management, Inc.,
                                       as attorney in fact

                                    By____________________________________
                                      Title:

                                      S-22
<PAGE>

                Signature Page to Duane Reade Amendment Agreement

                                    ELT LTD.

                                    By____________________________________
                                      Title:

                                      S-23<PAGE>

                                                                   Exhibit 10.19

                     FIRST AMENDMENT TO EMPLOYMENT AGREEMENT

         THIS AMENDMENT (the "AMENDMENT") is made as of the 13th day of March
2000 and shall hereby constitute the first amendment to the employment
agreement, dated October 27, 1997, and effective as of June 18, 1997 (the
"AGREEMENT"), and is made by and among Duane Reade, Inc., a Delaware
corporation (the "COMPANY") and Anthony Cuti (the "EXECUTIVE"). Capitalized
terms that are not otherwise defined in this Amendment shall have the meanings
assigned to them in the Agreement.

                              W I T N E S S E T H:

         WHEREAS, the Executive and the Company entered into the Agreement,
effective June 18, 1997 and Executive is currently employed by the Company under
the Agreement; and

         WHEREAS, pursuant to Section 34 of the Agreement (as numbered prior to
this Amendment), the Company and the Executive may amend the agreement by an
instrument in writing, signed by the Executive and the Chairman of the Board of
Directors of the Company; and

         WHEREAS, the parties desire to enter into this Amendment, which
Amendment shall be effective as of the date first set forth above;

         NOW THEREFORE, and in consideration of the foregoing and the mutual
agreements set forth herein, the parties, intending to be legally bound, agree
as follows:

         1. EARNINGS AMOUNT. The following definition is hereby inserted in
Section I of the Agreement after the definition of "EBITDA ACHIEVEMENT FACTOR"
and before the definition of "EMPLOYMENT RELATED AGREEMENTS":

         "EARNINGS AMOUNT" shall mean, as of the Termination Date, the greater
         of :

         (i) for any period during the Term of Employment, the largest dollar
         amount equal to the sum of the Base Salary, Incentive Bonus and Target
         Bonus earned by the Executive (or deferred by him) during such period,
         and

         (ii) the dollar amount equal to the result of the following formula:

         (S + MTB + MIB) x Y, where

         S= Base Salary earned by the Executive during the period immediately
         prior to the Termination Date,

         MTB = the maximum Target Bonus the Executive could have earned during
         the period immediately prior to the Termination Date,

<PAGE>

         MTB = the maximum Incentive Bonus the Executive could have earned
         during the period immediately prior to the Termination Date, and

         Y = an appreciation rate of 10% per annum through the end of the then
         current Term of Employment.

         2. EMPLOYMENT RELATED AGREEMENTS. The definition of "EMPLOYMENT RELATED
AGREEMENT" in Section 1 of the Agreement is hereby deleted in its entirety and
replaced by the following:

         "EMPLOYMENT RELATED AGREEMENTS" shall mean this Agreement, the DLJ
Note, the Company Note, the Non-Qualified Stock Option Agreement, the
Non-Qualified Performance Stock Option Agreement and the Non-Qualified
Super-Performance Stock Option Agreement, as such documents may be amended from
time to time.

         3. TERM OF EMPLOYMENT. Section 2(a) of the Agreement is hereby deleted
and replaced by the following:

                  (a) The Company will employ the Executive and the Executive
         will enter the employ of the Company, for the period set forth in this
         Section 2, in the positions set forth in Section 3 and upon the other
         terms and conditions herein provided. The initial term of employment
         under this Agreement (the "INITIAL TERM") will be for the period
         beginning on the Start Date and ending on the fifth anniversary
         thereof, unless earlier terminated as provided in Section 16.

         4. THE SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN. Section 15(a) of the
Agreement is hereby deleted and replaced by the following:

                  (a) The Company will establish a Supplemental Executive
         Retirement Plan (the "SERP") which will provide the Executive (or in
         the event of the Executive's earlier death, his Beneficiary) with a
         lump sum payment (the "SERP PAYMENT") equal to the Actuarial
         Present Value (as defined below) of an annual retirement benefit,
         commencing as of the first day of the month following the month in
         which the Executive attains (or, in the event of his death, would have
         attained) age 65 and payable during his lifetime, of 1.33 percent of
         the Earnings Amount times the number of years of his Term of
         Employment.

         5. SEVERANCE BENEFITS. (a) Section 17(a)(ii) is hereby deleted and
replaced with the following:

                  (ii) CONTINUATION OF BASE SALARY AND BONUS. Subject to
                       Section 17(a)(viii), the Company will pay the Executive,
                       in substantially equal installments in accordance with
                       the Company's standard payroll practices, for the
                       twenty-four-month period immediately following the
                       Termination Date (the "CONTINUATION PERIOD") an amount
                       equal to the product of:

                   (A) the Earnings Amount and

                   (B) five.

                  (b) Section 17(a)(viii) is hereby deleted and replaced by the
         following:

                                        2
<PAGE>

                  (viii) EXTENSION OF CONTINUATION PERIOD. If:

                           (A) the Termination Date is on or prior to the sixth
                  anniversary of the Start Date.

                           (B) the Termination Date is within the one-year
                  period following the date of a Sale of the Company,

                           (C) EBITDA for the calendar year ended immediately
                  prior to the Termination Date equals or exceeds the Base
                  EBITDA Target for such year, and

                           (D) as of the Termination Date the business units
                  which constituted the Company prior to its sale are at least
                  anticipated (as reasonably determined by the Company's outside
                  auditors) to achieve the Base EBITDA Target for the year in
                  which occurs the Termination Date,

                  then the Continuation Period referred to in Section 17(a)(ii)
                  shall be extended to thirty-six months.

         6. SEVERANCE BENEFITS PERTAINING TO THE SERP. (a) Section 17(a)(vii) is
hereby deleted and replaced by the following:

                  (vii) SERP. The Executive (or his Beneficiary) shall be
         entitled, commencing upon attaining age 65 (or the Termination Date, if
         later), to the SERP Payment determined pursuant to Section 15(a), based
         on the Earnings Amount, and deeming the Term of Employment for purposes
         of Section 15(a) to equal 20 years. The SERP Payment specified in this
         Section 17(a)(vii) will be in full satisfaction of all obligations
         under the SERP.

         (b) Section 17(c)(v) of the Agreement is hereby deleted and replaced by
the following:

                  (v) SERP. The Executive (or his Beneficiary) will be entitled
         to the SERP Payment, commencing on the date the Executive
         attains or would have attained age 65 (or his Termination Date, if
         later) determined pursuant to Section 15(a), based on the Earnings
         Amount and based on a Term of Employment, for purposes of
         Section 15(a), equal to 20 years. The SERP Payment specified in this
         Section 17(c)(v) will be in full satisfaction of all obligations under
         the SERP.

         7. GROSS-UP: SECTION 280G OF THE CODE. The following is added to the
Agreement as Section 18 thereof and the prior Sections 18 through 34 are
renumbered accordingly as Sections 19 through 35.

                  18. GROSS-UP: SECTION 280G OF THE CODE. Notwithstanding
         anything herein to the contrary. If it is determined that any portion
         of the Payments (as hereinafter defined) provided in this Agreement
         would be subject to the excise tax imposed by Section 4999 of the
         Code or any interest or penalties with respect to such excise tax
         (such excise tax, together with any interest or penalties thereon,
         is herein referred to as an "EXCISE TAX"), then the Executive shall be
         entitled to an additional cash payment (a "GROSS-UP PAYMENT") in an
         amount that will place the Executive in the same after tax economic
         position that the Executive would have enjoyed if the Exotic Tax had
         not applied to the Payment. The amount of the Gross-Up Payment shall
         be determined by a nationally recognized accounting firm agreed upon by
         Executive and the Company (the "ACCOUNTING FIRM"). No Gross-Up

                                        3
<PAGE>

         Payments shall be payable hereunder if the Accounting Firm determines
         that the Payments are not subject to an Excise Tax. The Accounting Firm
         shall be paid by the Company for services performed hereunder.

                  PAYMENT means (1) any amount due or paid to the Executive
         under this Agreement. (ii) any amount that is due or paid to the
         Executive under any plan, program or arrangement of the Company and its
         subsidiaries, and (iii) any amount of benefits that is due or payable
         to the Executive under this Agreement or under any plan, program or
         arrangement of the Company and its subsidiaries or affiliates not
         otherwise covered under clause (i) or (ii) hereof which must reasonably
         be taken into account under Section 280G of the Code and the
         regulations pertinent thereto in determining the amount of the
         "PARACHUTE PAYMENTS" received by the Executive, including, without
         limitation, any amounts which must be taken into account under the Code
         and regulations as a results of (x) the acceleration of the vesting of
         Options or any other equity compensation that the Executive may receive
         in the future.

                  (b) DETERMINATION OF GROSS-UP PAYMENT. Subject to the
         provision of Section 18(c), all determinations required under this
         Section 18, including whether a Gross-Up Payment is required, the
         amount of the Payments constituting excess parachute payments, and the
         amount of the Gross-Up Payment, shall be made by the Accounting Firm,
         which shall provide detailed supporting calculations both to the
         Executive and the Company within fifteen days of any date reasonably
         requested by the Executive or the Company on which a determination
         under this Section 18 is necessary or advisable. The Company shall pay
         the Executive in cash the initial Gross-Up Payments within 5 days of
         the receipt by the Executive and the Company of the Accounting Firm's
         determination. If the Accounting Firm determines that no Excise Tax is
         payable by the Executive, the Company shall cause the Accounting Firm
         to provide the Executive with an opinion that the Accounting Firm has
         substantial authority under the Code and regualtions promulgated
         thereunder not to report an Excise Tax on the Executive's federal
         income tax return. Any determination by the Accounting Firm shall be
         binding upon the Executive and the Company. If the initial Gross-Up
         Payment is insufficient to completely place the Executive in the same
         after-tax economic position that the Executive would have enjoyed if
         the Excise Tax had not applied to the Payments (hereinafter an
         "UNDERPAYMENT"), the Company, after exhausting its remedies under
         Section 18(c) below, shall promptly pay the Executive in cash an
         additional Gross-UP Payment in respect of the Underpayment.

                  (c) PROCEDURES. The Executive shall notify the Company in
         writing of any claim by the Internal Revenue Service that, if
         successful, would require the payment by the Company of a Gross-Up
         Payment. Such notice shall be given as soon as practicable after the
         Executive knows of such claim and shall appraise the Company of the
         nature of the claim and the date on which the claim is requested to be
         paid. The Executive agrees not to pay the claim until the expiration of
         the thirty day period following the date on which the Executive
         nofities the Company, or such shorter period ending on the date the
         taxes with respect to such claim are due (the "NOTICE PERIOD"). If the
         Company notifies the Executive in writing prior to the expiration of
         the Notice Period that it desires to contest the claim, the Executive
         shall: (i) give the Company any information reasonably requested by the
         Company relating to the claim; (ii) take such action in connection with
         the claim as the Company may reasonably request, including without
         limitation accepting legal representation with respect to such claim by
         an attorney reasonably selected by the Company and reasonably
         acceptable to the Executive; (iii) cooperate with the Company in good
         faith in contesting the claim; and (iv) permit the Company to
         participate in any proceedings relating to the claim. The Executive
         shall permit the Company to control all proceedings related to the
         claim and, at its option, permit the Company to pursue or forgo any and
         all administrative appeals, proceedings, hearings, and conferences with
         the taxing authority in respect of such claim. If requested by the
         Company, the Executive agrees either to pay the tax claimed and sue for
         a refund or contest the claim in any permissible manner and to
         prosecute such contest to a determination before any administrative
         tribunal, in a court of initial jurisdictions and in one or more
         appellate courts as the Company shall determine: PROVIDED, HOWEVER,
         that, if the Company directs the Executive to pay such

                                        4

<PAGE>

         claim and pursue a refund, the Company shall advance the amount of such
         payment to the Executive on an after-tax and interest-free basis (the
         "ADVANCE"). The Company's control of the contest related to the claim
         shall be limited to the issues related to the Gross-Up Payment and the
         Executive shall be entitled to settle or contest, as the case may be,
         any other issues raised by the Internal Revenue Service or other taxing
         authority. If the Company does not notify the Executive in writing
         prior to the end of the Notice Period of its desire to contest the
         claim, the Company shall pay the Executive in cash an additional
         Gross-Up Payment in respect of the excess parachute payments that are
         the subject of the claim, and the Executive agrees to pay the amount of
         the Excise Tax that is the subject of the claim so the applicable
         taxing authority in accordance with applicable law.

                  (d) REPAYMENTS. If, after receipt by the Executive of an
         Advance, the Executive becomes entitled to a refund with respect to the
         claim to which such Advance relates, the Executive shall pay the
         Company the amount of the refund (together with any interest paid or
         credited thereon after taxes applicable thereto). If, after receipt by
         the Executive of an Advance, a determination is made that the Executive
         shall not be entitled to any refund with respect to the claim and the
         Company does not promptly notify the Executive of its intent to contest
         the denial of refund, then the amount of the Advance shall not be
         required to be repaid by the Executive and the amount thereof shall
         offset the amount of the additional Gross-Up Payment then owing to the
         Executive.

                  (e) FURTHER ASSURANCES. The Company shall indemnify the
         Executive and hold the Executive harmless, on an after-tax basis, from
         any costs, expenses, penalties, fines, interest or other liabilities
         ("LOSSES") incurred by the Executive with respect to the exercise by
         the Company of any of its rights under this Section 18, including,
         without limitation, any Losses related to the Company's decision to
         contest a claim or any imputed income to the Executive resulting from
         any Advance or action taken on the Executive's behalf by the Company
         hereunder. The Company shall pay all legal fees and expenses incurred
         under this Section 18, and shall promptly reimburse the Executive for
         the reasonable expenses of the Accounting Firm, including, without
         limitation, the fees and expenses related to the opinion referred to in
         Section 18(b).

         8. CONTINUING EFFECT OF THE AGREEMENT. This Agreement shall continue in
full force and effect as amended herein.

         9. ATTORNEYS FEES. The Company shall pay or reimburse Executive for all
reasonable legal fees and costs incurred in the drafting, negotiation and
execution of this Amendment.

         10. COUNTERPARTS. This Amendment may be executed by the parties hereto
in counterparts, each of which shall be deemed an original, but both such
counterparts shall together constitute one and the same document.

                            (Signature Page Follows)

                                       5
<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date and year first above written.

                                   THE EXECUTIVE

                                   /s/ Anthony Cuti

                                   Anthony Cuti
                                   440 Ninth Avenue
                                   New York, New York 10001

                                   DUANE READE INC.

                                   By: /s/ Anthony Cuti
                                       Name:  Anthony Cuti
                                       Title:  Chairman of the Board
                                      (in compliance with the employment
                                      agreement, dated October 27, 1997, and
                                      effective as of June 18, 1997)

                                   By: /s/ David Jaffe
                                       Name:  David Jaffe
                                       Title:  Chairman of the Compensation
                                           Committee of the Board of
                                           Directors

                                       6

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