PROMISSORY
      NOTE

     

    
      	$2,400,000	
               Westbury,
                New York 

            
	 	
               June
                7,
                2007

            


    

     

    


    FOR
      VALUE RECEIVED, MIAMI SUBS CAPITAL PARTNERS I, INC.,
      a
      Florida corporation with an office at 6300 NW 31st
      Avenue,
      Fort Lauderdale, Florida (the
      “Maker”), promises to pay to the order of NATHAN’S
      FAMOUS, INC.,
      a
      Delaware corporation (the “Payee”), the principal amount of TWO
      MILLION FOUR HUNDRED THOUSAND DOLLARS
      ($2,400,000),
      on or
      before June 6, 2011 (the
      “Maturity Date”), in
      lawful
      money of the United States of America, together with interest on the unpaid
      principal amount hereof, from time to time outstanding, from the date hereof
      through and including the date that this Note is paid in full, at a rate of
      eight percent (8%) per annum.   

    


    The
      Maker
      promises to pay to the Payee monthly
      installments of $16,000.00 each for the first four months and $63,116.33 each
      for the next forty-four months, subject to adjustment upon any prepayment made
      by Maker in accordance with the terms hereof. Each installment shall be paid
      on
      the last day of each calendar month commencing June 30, 2007, with a final
      installment to be paid on the Maturity Date.
      Interest
      hereunder shall be computed on the actual number of days elapsed over a year
      comprised of 365 days. Nothing herein shall be deemed to require Maker to
      make payments of interest which exceed the maximum permitted by law. In any
      such
      event, this Note shall be deemed automatically amended to require payment of
      interest at the maximum amount permitted by law.

    


    All
      amounts payable hereunder shall be made in lawful money of the United States
      of
      America at such place as may be designated to the Maker in writing by the Payee
      from time to time. If any payment hereunder becomes due and payable on a day
      other than a Business Day (hereafter defined), such payment shall be extended
      to
      the next succeeding Business Day. “Business Day” shall mean a day other than a
      Saturday, Sunday or other day on which commercial banks in New York State
      are authorized or required by law to close. Upon
      the
      occurrence of an Event of Default, as that term is defined below, interest
      payable on this Note shall be at the rate of twelve percent (12%) per annum
      or
      the maximum rate allowed to be charged by law, whichever is lower.

    


    This
      Note
      may be prepaid at the option of the Maker in whole or in part at any time
      without penalty or premium. All prepayments shall be accompanied by accrued
      interest on the principal amount repaid to the date of repayment. 

    


    This
      Note
      shall be subject to mandatory prepayment (i) upon the settlement or the
      adjudication of the litigation entitled Ontario
      Superior Court of Justice-Commercial Litigation, Court File No. 06-00CL6270,
      Lawrence B. Austin, Plaintiff v. Michael Overs, Tesari Holdings, Ltd., &
Pizza Pizza, Ltd., Defendants,
      in an
      amount equal to the amount payable to Lawrence Austin or any affiliate in
      settlement or by award of the court having jurisdiction over such action, after
      deduction of attorneys’ fees paid by Lawrence Austin in connection with such
      action and (ii) in an amount equal to any liability of the Payee in respect
      of
      an indemnification claim made by Maker against Payee pursuant to Article V
      of
      the Stock Purchase Agreement dated as of June 7, 2007 by and among the Maker,
      the Payee and Miami Subs Corporation upon a final determination of liability
      by
      Maker and Payee or by final judicial proceeding. In the event of any partial
      prepayment, whether or not mandatory, the amount of the monthly payment payable
      by Maker hereunder shall be reduced to the amount obtained by fully amortizing
      the unpaid principal balance following such prepayment over the balance of
      the
      term remaining until the Maturity Date. In the event that the Maker shall pay
      in
      full all amounts due under this Note on or before June 6, 2008, in cash in
      immediately available funds, the Payee hereby agrees that the Maker shall be
      entitled to deduct Two Hundred Fifty Thousand ($250,000) Dollars from such
      aggregate amount and, notwithstanding such deduction, the Note will be fully
      paid and Maker will have no further obligations hereunder. 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Payee
      may
      declare the entire unpaid principal balance of the Note, together with interest
      accrued thereon, to be immediately due and payable upon the occurrence of any
      of
      the following events (each an “Event of Default”): (a) the failure of Maker
      to pay the principal of, or interest on, this Note when due, and such failure
      shall continue unremedied for a period of ten (10) days; (b) any petition in
      bankruptcy being filed by or against the Maker, or any proceedings in
      bankruptcy, or under any law relating to the relief of debtors, being commenced
      for the relief or readjustment of any indebtedness of the Maker; provided,
      with
      respect to any such petition filed against Maker, such petition shall continue
      undismissed for a period of 30 days from the date of entry thereof; (c) the
      making by the Maker of an assignment for the benefit of creditors; (d) the
      appointment of a receiver of all or substantially all of the property of the
      Maker; (e) the merger, consolidation, or sale of all or substantially all of
      the
      assets of the Maker to any third party; (f) any breach of any representation,
      warranty or covenant of the Maker contained in the Security Agreement, of even
      date herewith, between Maker and Payee, which breach, if capable of cure, shall
      not have been cured within twenty (20) days following delivery of written notice
      to Maker; or (g) the guaranty executed by Lawrence Austin or Bruce Galloway
      (each, a “Guarantor”) with respect to Maker’s obligations hereunder shall cease
      to be in full force and effect or any Guarantor shall so assert in
      writing.

    


    Maker
      agrees that whenever an attorney is used to collect or enforce this Note or
      to
      enforce, declare or adjudicate any rights or obligations under this Note whether
      by suit or any other means whatsoever, the Maker shall pay all of the legal
      fees
      of the attorneys for the Payee, together with all costs and expenses of such
      collection, enforcement or adjudication, which obligation shall constitute
      part
      of the principal obligation hereunder.

    


    Maker
      hereby waives diligence, presentment, protest, demand and notice of every kind
      except as otherwise expressly required herein. This Note may not be modified
      orally.

    


    THIS
      NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
      STATE OF NEW YORK, WITHOUT REFERENCE TO CONFLICT OF LAW PRINCIPLES.


    


     

    
      	 	 	 
	 	MIAMI
              SUBS CAPITAL PARTNERS I, INC.,
	 
 	 
 	 
 
	 	By:  	/s/ 
              George Herman
	 	
              

              Name:  George
              Herman
	 	Title:   
              President