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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


Amendment No. 1
to
SCHEDULE 13E-3
Rule 13e-3 Transaction Statement
(Pursuant to Section 13(e) of the Securities Exchange Act of 1934)


DUANE READE INC.
(Name of the Issuer)


DUANE READE INC.
DUANE READE ACQUISITION CORP.
DUANE READE HOLDINGS, INC.
DUANE READE SHAREHOLDERS, LLC
OAK HILL CAPITAL PARTNERS, L.P.
ANTHONY J. CUTI
GARY CHARBONEAU
TIMOTHY R. LABEAU
JOHN K. HENRY
JERRY M. RAY
(Name of Person(s) Filing Statement)


Common Stock, par value $.01 per share
(Title of Class of Securities)


263578106
(CUSIP Number of Class of Securities)

Duane Reade Inc.
Anthony J. Cuti
Gary Charboneau
Timothy R. LaBeau
John K. Henry
Jerry M. Ray
c/o Duane Reade Inc.
440 Ninth Avenue
New York, NY 10001
(212) 273-5700
  Duane Reade Acquisition Corp.
Duane Reade Holdings, Inc.
Duane Reade Shareholders, LLC
Oak Hill Capital Partners, L.P.
c/o Oak Hill Capital Partners, L.P.
Ray Pinson
201 Main Street, Suite 3100
Fort Worth, TX 76102
(817) 338-2605

(Name, Address and Telephone Number
of Person Authorized to Receive Notices
and Communications on Behalf of Person(s)
Filing Statement)

Copy of communications to:

Jeffrey J. Weinberg, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
(212) 310-8000
  Robert B. Schumer, Esq.
Paul, Weiss, Rifkind, Wharton
& Garrison LLP
1285 Avenue of the Americas
New York, NY 10019-6064
(212) 373-3000




        This Statement is filed in connection with:

        Check the following box if the soliciting material or information statement referred to in checking box (a) are preliminary copies:    ý

        Check the following box if the filing is a final amendment reporting the results of the transaction:    o


        THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE COMMISSION PASSED UPON THE FAIRNESS OR MERITS OF SUCH INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.


Calculation of Filing Fee


Transaction Valuation*
  Amount of Filing Fee

$422,198,636   $53,493

*
For purposes of calculating the filing fee only, the transaction valuation was based upon the sum of (i) the product of 24,498,799 shares of common stock, par value $0.01 per share and the merger consideration of $17.00 per share and (ii) the difference between the merger consideration of $17.00 per share and the exercise price per share of each of the 1,997,105 shares of common stock underlying outstanding options in which the exercise price per share is less than $17.00 per share.

ý
Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid: $53,400   (2) Amount Previously Paid: $93

 

Form or Registration No.: Schedule 14A

 

 

Form or Registration No.: Amendment No. 1 to the Schedule 14A

 

Filing Party: Duane Reade Inc.

 

 

Filing Person: Duane Reade Inc.

 

Date Filed: March 19, 2004

 

 

Date Filed: May 14, 2004


INTRODUCTION

        This Amendment No. 1 to the Rule 13e-3 Transaction Statement on Schedule 13E-3 (the "Statement") is being filed with the Securities and Exchange Commission (the "Commission") by (1) Duane Reade Inc., a Delaware corporation (the "Company"), the issuer of common stock, par value $.01 ("Company Common Stock"), which is subject to a Rule 13e-3 transaction, (2) Duane Reade Acquisition Corp. (formerly known as Rex Corner Acquisition Corp., "Duane Reade Acquisition"), a Delaware corporation, (3) Duane Reade Holdings, Inc. (formerly known as Rex Corner Holdings, Inc., "Duane Reade Holdings"), a Delaware corporation, (4) Duane Reade Shareholders, LLC (formerly known as Rex Corner Holdings, LLC, "DRS, LLC"), a Delaware limited liability company, (5) Oak Hill Capital Partners, L.P. ("OHCP"), a Delaware limited partnership, (6) Anthony J. Cuti, an individual, the Chairman of the Board, President and Chief Executive Officer of the Company (the "Chairman") and (7) Gary Charboneau, Timothy R. LaBeau, John K. Henry and Jerry M. Ray, each a Senior Vice President of the Company (collectively, the "SVPs" and together with the Company, Duane Reade Acquisition, Duane Reade Holdings, DRS, LLC, OHCP and the Chairman, the "Filing Persons"). Pursuant to the Agreement and Plan of Merger, dated as of December 22, 2003 (the "Merger Agreement"), by and among the Company, DRS, LLC and Duane Reade Acquisition, Duane Reade Acquisition will merge with and into the Company, and the Company will continue as the surviving corporation.

        Concurrently with the filing of this Statement, the Company is filing with the Commission Amendment No. 1 to the preliminary proxy statement (the "Proxy Statement") under Regulation 14A of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), relating to the special meeting of stockholders of the Company, at which the stockholders of the Company will consider and vote upon, among other things, a proposal to adopt the Merger Agreement and the transactions contemplated thereby, including the merger of Duane Reade Acquisition with and into the Company. As a result of the merger, holders of Company Common Stock, other than holders of Company Common Stock who properly demand appraisal rights, will be entitled to receive $17.00 in cash, without interest, for each share of Company Common Stock. Options to acquire Company Common Stock will be treated as described more fully in the Proxy Statement.

        The merger and the Merger Agreement have not been approved or disapproved by the Securities and Exchange Commission or any state securities commission nor has any such commission passed upon the merits of the merger or the Merger Agreement nor upon the accuracy or adequacy of the information contained in this document. Any representation to the contrary is a criminal offense.

        The cross reference sheet below is being supplied pursuant to General Instruction F to Schedule 13E-3 and shows the location in the Proxy Statement of the information required to be included in response to the items of this Statement. The information set forth in the Proxy Statement, including all schedules, exhibits, appendices and annexes thereto, is hereby expressly incorporated herein by reference and the responses to each item in this Statement are qualified in their entirety by the information contained in the Proxy Statement and the schedules, exhibits, appendices and annexes thereto.

        All information contained in this Statement concerning any of the Filing Parties has been provided by such Filing Party and no other Filing Person, including the Company, takes responsibility for the accuracy of any information not supplied by such Filing Person. As of the date hereof, the Proxy Statement is in preliminary form and is subject to completion or amendment. All capitalized terms used but not defined in this Statement shall have the respective meanings ascribed to them in the Proxy Statement.

        The filing of this Statement shall not be construed as an admission by any Filing Person or by any affiliate of a Filing Person, that the Company is "controlled" by Duane Reade Acquisition, Duane Reade Holdings, DRS, LLC, OHCP, the Chairman or any SVP, or that any of Duane Reade

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Acquisition, Duane Reade Holdings, DRS, LLC, OHCP, the Chairman or the SVPs is an "affiliate" of the Company within the meaning of Rule 13e-3 under Section 13(e) of the Exchange Act.


ITEM 1. SUMMARY TERM SHEET.


ITEM 2. SUBJECT COMPANY INFORMATION.


ITEM 3. IDENTITY AND BACKGROUND OF FILING PERSON.

  (a)-(c)   Name and Address; Business and Background of Entities; Business and Background of Natural Persons. The information contained in the sections of the Proxy Statement entitled "Summary of the Proxy Statement—Information About the Transaction Participants," "Current Executive Officers and Directors of Duane Reade," "Current Executive Officers and Managers of DRS, LLC," "Current Executive Officers and Directors of Duane Reade Holdings and Duane Reade Acquisition," "Information About the Transaction Participants" and "Criminal Proceedings and Injunctions or Prohibitions Involving Securities Laws" is incorporated herein by reference.

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Name

  Business Address
  Occupation or Employment
J. Taylor Crandall   201 Main St.
Fort Worth, TX 76102
  Since 1998, Mr. Crandall has served as a Manager and Vice President of MGP.

 

 

2775 Sand Hill Rd., Ste. 220
Menlo Park, CA 94025

 

Mr. Crandall's current principal occupation is Vice President of Oak Hill Capital Management, Inc., the principal business of which is acting as the manager of OHCP.

 

 

201 Main St.
Fort Worth, TX 76102

 

Since August 1996, Mr. Crandall has also served as President of Strategic GenPar, Inc., the principal business of which is acting as general partner of FW Strategic Asset Management, L.P., which in turn acts as general partner of Oak Hill Strategic Partners, L.P., an exchange investment fund.

Steven B. Gruber

 

201 Main St.
Fort Worth, TX 76102

 

Since 1998, Mr. Gruber has served as a Manager and Vice President of MGP.

 

 

65 E. 55th St., Ste. 3600
New York, NY 10022

 

Mr. Gruber's current principal occupation is Vice President of Oak Hill Capital Management, Inc., the principal business of which is acting as the manager of OHCP.
         

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Andrew J. Nathanson

 

201 Main St.
Fort Worth, TX 76102

 

Since 2000, Mr. Nathanson has served as a Manager and Vice President of MGP.

 

 

65 E. 55th St., Ste. 3600
New York, NY 10022

 

Mr. Nathanson's principal occupation since March 2000 has been Vice President of Oak Hill Capital Management, Inc., the principal business of which is acting as the manager of OHCP.

 

 

277 Park Avenue
New York, NY 10172

 

From 1989 until March 2000, Mr. Nathanson served as Managing Director at Donaldson, Lufkin & Jenrette, an investment bank.

Mark A. Wolfson

 

201 Main St.
Fort Worth, TX 76102

 

Since 1998, Mr. Wolfson has served as a Manager and Vice President of MGP.

 

 

2775 Sand Hill Rd., Ste. 220
Menlo Park, CA 94025

 

Mr. Wolfson's current principal occupation is Vice President of Oak Hill Capital Management, Inc., the principal business of which is acting as the manager of OHCP.

 

 

201 Main St.
Fort Worth, TX 76102

 

Since August 1996, Mr. Wolfson has also served as the Vice President of Strategic GenPar, Inc., the principal business of which is acting as general partner of FW Strategic Asset Management, L.P., which in turn acts as general partner of Oak Hill Strategic Partners, L.P., an exchange investment fund.
         

4



W. Robert Cotham

 

201 Main St.
Fort Worth, TX 76102

 

Since 1998, Mr. Cotham has served as Manager and Vice President of MGP. Mr. Cotham's current principal occupation is Vice President and Controller of Bass Enterprises Production Co., an oil and gas exploration and production company.

John H. Fant

 

201 Main St.
Fort Worth, TX 76102

 

Since 1998, Mr. Fant has served as a Manager, Vice President and Secretary of MGP. Mr. Fant's current principal occupation is General Counsel of Keystone, Inc., an investment firm.

Kevin G. Levy

 

201 Main St.
Fort Worth, TX 76102

 

Since 1998, Mr. Levy has served as a Manager, Vice President and Secretary of MGP. Mr. Levy's current principal occupation is General Counsel of Keystone, Inc., an investment firm.

Ray Pinson

 

201 Main St.
Fort Worth, TX 76102

 

Since 2000, Mr. Pinson has served as a Manager and Vice President of MGP. Mr. Pinson's current principal occupation is accounting manager for Oak Hill Strategic Partners, L.P., an exchange investment fund. Since January 1999, Mr. Pinson has also served as chief financial officer of OHCP.

John R. Monsky

 

201 Main St.
Fort Worth, TX 76102

 

Since 1998, Mr. Monsky has served as Vice President, Treasurer and Secretary of MGP.
         

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65 E. 55th St., Ste. 3600
New York, NY 10022

 

Mr. Monsky's current principal occupation is Vice President, Treasurer and Secretary and General Counsel of Oak Hill Capital Management, Inc., the principal business of which is acting as the manager of OHCP. Mr. Monsky also provides services for or is general counsel to Oak Hill Advisors, L.P. (and affiliated entities), an investment firm focusing on high-yield debt and special situation investments.


ITEM 4. TERMS OF THE TRANSACTION.

6



ITEM 5. PAST CONTACTS, TRANSACTIONS, NEGOTIATIONS AND AGREEMENTS.

7



ITEM 6. PURPOSES OF THE TRANSACTION AND PLANS OR PROPOSALS.


ITEM 7. PURPOSES, ALTERNATIVES, REASONS AND EFFECTS.


ITEM 8. FAIRNESS OF THE TRANSACTION.

        

8



ITEM 9. REPORTS, OPINIONS, APPRAISALS AND CERTAIN NEGOTIATIONS.

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ITEM 10. SOURCE AND AMOUNTS OF FUNDS OR OTHER CONSIDERATION.


ITEM 11. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.


        Other than as set forth in the Proxy Statement, none of the OHCP Parties, their associates or majority-owned subsidiaries beneficially own any securities of the Company.

        None of the OHCP Parties have been involved with any transaction in the securities of the Company during the past 60 days.


ITEM 12. THE SOLICITATION OR RECOMMENDATION.


ITEM 13. FINANCIAL INFORMATION.

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ITEM 14. PERSONS/ASSETS, RETAINED, EMPLOYED, COMPENSATED OR USED.


ITEM 15. ADDITIONAL INFORMATION.


ITEM 16. EXHIBITS.

        

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SIGNATURE

        After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this Statement is true, complete and correct.

Dated: May 14, 2004

 
   
 
 
    DUANE READE INC.

 

 

By:

/s/  
MICHELLE D. BERGMAN      
      Name: Michelle D. Bergman
      Title: Vice President & General Counsel

 

 

DUANE READE ACQUISITION CORP.

 

 

By:

/s/  
ANDREW J. NATHANSON      
      Name: Andrew J. Nathanson
      Title: Vice President

 

 

DUANE READE HOLDINGS, INC.

 

 

By:

/s/  
ANDREW J. NATHANSON      
      Name: Andrew J. Nathanson
      Title: Vice President

 

 

DUANE READE SHAREHOLDERS, LLC

 

 

By:

/s/  
ANDREW J. NATHANSON      
      Name: Andrew J. Nathanson
      Title: Vice President

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OAK HILL CAPITAL PARTNERS, L.P.

 

 

By:

OHCP GenPar, L.P., its general partner

 

 

By:

OHCP MGP, LLC, its general partner

 

 

By:

/s/  
ANDREW J. NATHANSON      
      Name: Andrew J. Nathanson
      Title: Vice President

 

 

/s/  
ANTHONY J. CUTI      
ANTHONY J. CUTI

 

 

/s/  
GARY CHARBONEAU      
GARY CHARBONEAU

 

 

/s/  
TIMOTHY R. LABEAU      
TIMOTHY R. LABEAU

 

 

/s/  
JOHN K. HENRY      
JOHN K. HENRY

 

 

/s/  
JERRY M. RAY      
JERRY M. RAY

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EXHIBIT INDEX

EXHIBIT
NUMBER

  DESCRIPTION
(a)(1)   Amendment No. 1 to the preliminary proxy statement on Schedule 14A filed with the Securities and Exchange Commission on May 14, 2004 (incorporated herein by reference to the Proxy Statement).

(a)(2)

 

Proxy card distributed to Duane Reade common stock holders (incorporated herein by reference to the Proxy Statement).

(a)(3)

 

Press release, dated December 23, 2003 (incorporated herein by reference to Duane Reade Inc.'s Schedule 14A dated December 23, 2003).

(a)(4)

 

Press release, dated January 23, 2004 (incorporated herein by reference to Duane Reade Inc.'s Schedule 14A dated January 23, 2003).

(a)(5)

 

Press release, dated February 19, 2004 (incorporated by reference to Duane Reade Inc.'s Schedule 14A dated February 19, 2004).

(a)(6)

 

Transcript of conference call on financial results of Duane Reade Inc. conducted on February 19, 2004 (incorporated by reference to Duane Reade Inc.'s Schedule 14A dated February 23, 2004).

(a)(7)

 

Press release, dated April 21, 2004 (incorporated by reference to Duane Reade Inc.'s Schedule 14A dated April 21, 2004).

(a)(8)

 

Transcript of conference call on financial results of Duane Reade Inc. conducted on April 21, 2004 (incorporated by reference to Duane Reade Inc.'s Schedule 14A dated April 22, 2004).

(b)(1)

 

Commitment Letter from Oak Hill Capital Partners, L.P. and Oak Hill Capital Management Partners, L.P. to Rex Corner Holdings, LLC (now known as Duane Reade Shareholders, LLC), dated as of December 22, 2003 (incorporated herein by reference to Annex C of the Proxy Statement).

(b)(2)

 

Commitment Letter from Banc of America Securities LLC, Banc of America Bridge LLC, Bank of America, N.A., Citigroup Global Markets Inc., Citicorp North America Inc., UBS Securities LLC, UBS Loan Finance LLC, Credit Suisse First Boston and Wells Fargo Bank, National Association to Duane Reade Holdings, Inc., dated as of February 9, 2004 (incorporated herein by reference to Annex D of the Proxy Statement).

(c)(1)

 

Opinion of Bear, Stearns & Co. Inc. (incorporated herein by reference to Annex B of the Proxy Statement).

*(c)(2)

 

Financial presentation materials of Bear Stearns, dated as of May 8, 2003.

*(c)(3)

 

Financial presentation materials of Bear Stearns, dated as of October 22, 2003.

*(c)(4)

 

Financial presentation materials of Bear Stearns, dated as of December 16, 2003.

*(c)(5)

 

Financial presentation materials of Bear Stearns, dated as of December 21, 2003.

(d)(1)

 

Agreement and Plan of Merger, dated as of December 22, 2003, by and among Rex Corner Holdings, LLC (now known as Duane Reade Shareholders, LLC), Rex Corner Acquisition Corp. (now known as Duane Reade Acquisition Corp.) and Duane Reade Inc. (incorporated herein by reference to Annex A of the Proxy Statement).
     

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(d)(2)

 

Rights Agreement (incorporated by reference to Exhibit 1 of Duane Reade Inc.'s Form 8-A dated September 17, 2002).

(d)(3)

 

Amendment No. 1 to the Rights Agreement, dated as of December 19, 2003, by and between Duane Reade Inc. and EquiServe Trust Company, N.A. (incorporated herein by reference to Exhibit 10.21 of Duane Reade Inc.'s Form 10-K dated March 11, 2004).

*(d)(4)

 

Amended and Restated Employment Agreement, dated as of March 16, 2004, by and among Anthony J. Cuti, Duane Reade Acquisition Corp., Duane Reade Holdings, Inc. and Duane Reade Shareholders, LLC.

*(d)(5)

 

Letter Agreement, dated as of March 16, 2004, by and between Gary Charboneau and Duane Reade Acquisition Corp.

*(d)(6)

 

Letter Agreement, dated as of March 16, 2004, by and between Timothy R. LaBeau and Duane Reade Acquisition Corp.

*(d)(7)

 

Letter Agreement, dated as of March 16, 2004, by and between John K. Henry and Duane Reade Acquisition Corp.

*(d)(8)

 

Letter Agreement, dated as of March 16, 2004, by and between Jerry M. Ray and Duane Reade Acquisition Corp.

(d)(9)

 

Letter Agreement, dated as of March 19, 2004, by and among Duane Reade Shareholders, LLC, Duane Reade Acquisition Corp. and Duane Reade Inc. (incorporated herein by reference to Annex F of the Proxy Statement).

(f)

 

Section 262 of the Delaware General Corporation Law (incorporated herein by reference to Annex E of the Proxy Statement).

(g)

 

Not applicable.

*
Previously filed.

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INTRODUCTION
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EXHIBIT INDEX