AMENDMENT NO. 1 TO RIGHTS AGREEMENT


     THIS AMENDMENT NO. 1 TO RIGHTS  AGREEMENT (this  "Amendment"),  dated as of
June 15, 2005, is between  Nathan's  Famous,  Inc., a Delaware  corporation (the
"Company"),  and American Stock  Transfer & Trust Company,  as rights agent (the
"Rights Agent").

     WHEREAS,  the Company and the Rights  Agent are parties to a Third  Amended
and  Restated  Rights  Agreement,  dated as of December  10,  1999 (the  "Rights
Agreement"); and

     WHEREAS,  pursuant  thereto  and  the  provisions  of  the  certificate  of
incorporation of the Company, the Company distributed a Right (as defined in the
Rights  Agreement)  to each holder of shares of Common  Stock (as defined in the
Rights Agreement) of the Company; and

     WHEREAS,  the  Company  desires to amend the Rights  Agreement  pursuant to
Section 27 of the Rights Agreement as set forth below.

     NOW, THEREFORE, the Rights Agreement is hereby amended as follows:

     1.   AMENDMENT OF SECTION 7.

     Section 7 of the Rights  Agreement  is amended by deleting  subsection  (a)
thereof and replacing it in its entirety with the following:

               "(a) Subject to Section 7(e) hereof, the registered holder of any
          Right Certificate may exercise the Rights evidenced thereby (except as
          otherwise  provided  herein) in whole or in part at any time after the
          Distribution  Date upon surrender of the Right  Certificate,  with the
          form  of  election  to  purchase  on the  reverse  side  thereof  duly
          executed,  to the Rights Agent at the  principal  office of the Rights
          Agent in New York,  New York,  together  with  payment of the Purchase
          Price for each  share of the  Common  Stock as to which the Rights are
          exercised,  at or prior to the close of business on the earlier of (i)
          June 19, 2010 (the "Final Expiration Date"), or (ii) the date on which
          the Rights are  redeemed as provided in Section 23 (such  earlier date
          being herein referred to as the "Expiration  Date"); or (iii) the time
          at which the Rights are  exchanged  as  provided in Section 24 hereof;
          provided,  however,  that if the  number  of  Rights  exercised  would
          entitle  the  holder  thereof to receive  any  fraction  of a share of
          Common Stock  greater  than  one-half of a share,  the holder  thereof
          shall not be  entitled  to  exercise  such  Rights  unless such holder
          concurrently purchases from the Company (and in such event the Company
          shall sell to such  holder),  at a price in proportion to the Purchase
          Price, an additional  fraction of a share of Common Stock which,  when
          added to the number of shares of Common Stock to be received upon such
          exercise, will equal an integral number of shares of Common Stock."







         2.       MISCELLANEOUS.

     Except as expressly amended hereby,  the Rights Agreement shall continue in
full  force and effect in  accordance  with the  provisions  thereof on the date
hereof.  This Amendment  shall be deemed to be a contract made under the laws of
the State of Delaware and for all purposes shall be governed by and construed in
accordance  with the laws of such state  applicable  to contracts to be made and
performed  entirely  within such state.  This  Amendment  may be executed in any
number of  counterparts,  each of such  counterparts  shall for all  purposes be
deemed to be an original,  and all such counterparts  shall together  constitute
but one and the same  instrument.  Terms not defined  herein  shall,  unless the
context  otherwise  requires,  have the  meanings  assigned to such terms in the
Rights Agreement.

     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Amendment to be
duly executed as of the date set forth above.


                                       NATHAN'S FAMOUS, INC.


                                       By:  /s/Wayne Norbitz
                                           -----------------------------
                                            Name:  Wayne Norbitz
                                            Title: President

                                       AMERICAN STOCK TRANSFER & TRUST  COMPANY
                                       as Rights Agent


                                       By:  /s/Herbert Lemmer
                                          ------------------------------------
                                           Name:  Herbert Lemmer
                                           Title: Vice President