Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
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FORM S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
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NATHAN'S FAMOUS, INC.
(Exact name of registrant as specified in its charter)
Delaware 11-3166443
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1400 Old Country Road, Westbury, New York 11590
(Address of principal executive offices) (Zip Code)
NATHAN'S FAMOUS, INC. 2002 STOCK INCENTIVE PLAN
(Full Title of the Plan)
Wayne Norbitz, President
Nathan's Famous, Inc.
1400 Old Country Road
Westbury, New York 11590
(Name and address of agent for service)
(516) 338-8500
(Telephone number, including area code, of agent for service)
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copy to:
Nancy D. Lieberman, Esq.
Blau, Kramer, Wactlar & Lieberman, P.C.
100 Jericho Quadrangle
Jericho, New York 11753
(516) 822-4820
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CALCULATION OF REGISTRATION FEE
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Title of Each Proposed Maximum Proposed Maximum
Class of Securities Amount to be Offering Price Per Aggregate Offering Amount of
To be Registered Registered Security (1) Price (1) Registration Fee
Common Stock,
par value $.01 per 300,000 shs.(2) $3.41 $1,023,000 $94.12
share together with
the associated
common stock
purchase rights
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(1) Estimated solely for the purpose of calculating the registration fee, based
upon the average of the high and low prices of the Company's Common Stock on the
NASDAQ National Market System on November 15, 2002.
(2) This Registration Statement also covers an indeterminate number of
additional shares of Common Stock which may become issuable pursuant to
anti-dilution and adjustment provisions of the Plan.
NATHAN'S FAMOUS, INC.
SUMMARY OF NATHAN'S FAMOUS, INC.
2002 STOCK INCENTIVE PLAN
In June 2002, in order to attract and retain persons necessary for the
success of Nathan's, its board of directors adopted the Nathan's Famous, Inc.
2002 Stock Incentive Plan. The plan covers up to 300,000 shares of common stock,
pursuant to which directors, officers and employees of, and consultants to,
Nathan's and its subsidiaries and affiliates, are eligible to receive grants of
restricted stock or non-qualified stock options. Of the 300,000 shares issuable
under the plan, the maximum number of shares that may be issued as restricted
stock is 100,000. Shares of common stock issued under the plan, including upon
the exercise of options granted pursuant to the plan, will generally be from
Nathans' authorized but unissued shares or treasury shares. The plan, which
expires on June 7, 2012, will be administered by a committee designated by the
board of directors consisting of two or more members of the board, all of whom
shall be "non-employee" directors, as defined under Rule 16-b of the Securities
Exchange Act of 1934, as amended. Nathan's expects that its compensation
committee will administer the plan. Members of the committee administering the
plan may be removed or replaced at any time by the board of directors. The
selection of participants, allotments of shares, determination of price and
other conditions relating to options will be determined by the compensation
committee, in its sole discretion, subject to the limitations of the plan. The
maximum number of shares that may be covered by awards granted to any one
participant is 100,000 shares.
The plan may be amended, suspended or terminated by the board of directors
or the committee.
Stock options granted under the plan are exercisable for a period of up to
ten years from the date of grant at an exercise price equal to the fair market
value of the Common Stock on the date of the grant. Awards granted pursuant to
the plan may not be sold, pledged, hypothecated, transferred or disposed of in
any manner other than by will or by the laws of descent or distribution, or as
may be permitted by the board or the committee.
If any participant ceases to serve as an employee of, or consultant to,
Nathan's or any parent, subsidiary or affiliate company, he may, but only within
three (3) months after the date he ceases to be employed, exercise his option to
the extent that it was exercisable as of the date of such termination. Upon
termination of employment or provision of services due to total disability, the
optionee has a one year period to exercise his option to the extent it was
exercisable as of the date of such termination. To the extent that an optionee
was not entitled to exercise an option at the date of termination, or he does
not exercise the option (which he was entitled to exercise) within the time
specified therein, the option terminates. Notwithstanding the foregoing, in the
event of the death of an optionee (1) while an employee or providing services,
or (2) within three (3) months after termination of all employment or provision
of services (other than for total disability) or (3) within one (1) year after
termination on account of total disability of all employment or provision of
services, the optionee's estate or any person who acquires the right to exercise
the option by bequest or inheritance or by reason of the death of the optionee
may exercise such optionee's option at any time within the two (2) year period
from the date of death. In the case of clauses (1) and (3) above, the option
shall be exercisable in full for all the remaining shares covered thereby, but
in the case of clause (2), the option shall be exercisable only to the extent it
was exercisable on the date of such termination of employment or service. In no
case is an option exercisable after its expiration date.
In the case of restricted stock awards, unless otherwise provided by the
committee, upon termination of a participant's employment or provision of
services to Nathan's or any affiliate or subsidiary during any restriction
period for any reason other than death or total disability, all shares of
restricted stock subject to a restricted stock award will be forfeited to
Nathan's. Upon termination of a participant's employment due to death or total
disability, all restrictions on any restricted stock award will immediately
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lapse and the participant will take the shares of restricted stock subject to a
restricted stock award free and clear of any such restrictions.
In the event of a change in control (as defined in the plan) of Nathan's,
at the option of the committee, (a) all options outstanding on the date of the
change in control may become immediately and fully exercisable, and/or (b) all
shares of restricted stock may become fully vested.
Nathans' reports and registration statements filed with the Securities and
Exchange Commission pursuant to the provisions of the Securities Exchange Act of
1934 are incorporated by reference herein and these documents, as well as
Nathans' annual report to shareholders, its latest prospectus filed pursuant to
Rule 424(b) under the Securities Act of 1933, as amended, and additional
information about the plan and its administration, are available upon written or
oral request from the Treasurer of Nathan's, at its offices at 1400 Old Country
Road, Westbury, New York 11590, (516) 338- 8500. Nathan's does not intend to
furnish any reports to participants as to the amount and status of their options
under the plan.
FEDERAL INCOME TAX CONSEQUENCES
The following is a brief summary of the Federal income tax consequences as
of the date hereof with respect to transactions under the plan. This description
of the Federal income tax consequences is based upon law and Treasury
interpretations in effect on the date of this prospectus (including proposed and
temporary regulations which may be changed when finalized), and it should be
understood that this summary is not exhaustive, that the law may change, and
further that special rules may apply with respect to situations not specifically
discussed herein. The summary does not discuss the tax consequences of a
participant's death. Careful attention should also be given to state and local
tax consequences. As such, optionees are urged to consult with their own
qualified tax advisors.
Certain Federal Income Tax Consequences of Options
The grant of an option under the plan will create no income tax
consequences to the participant or to Nathan's. A participant who is granted an
option will generally recognize ordinary income at the time of exercise in an
amount by which the fair market value of the common stock at such time exceeds
the exercise price.
Nathan's will be entitled to an income tax deduction in the same amount of,
and the same time that, income is recognized by the participant, subject to the
requirement of reasonableness, certain limitations imposed by Section 162(m) of
the Internal Revenue Code of 1986, as amended, and the satisfaction of certain
income and employment tax withholding obligations.
Any gain or loss on the participant's subsequent disposition of the shares
of common stock will receive long or short-term capital gain or loss treatment,
depending on whether the shares are held for more than one year following
exercise. Nathan's will not be entitled to receive an income tax deduction for
any such gain.
If the optionee is subject to restrictions under Section 16(b) of the
Exchange Act at exercise, (i) he will not be taxed at the time of exercise, and
will instead be taxed when the Section 16(b) restrictions lapse (which is deemed
under Treasury regulations to be six months after the date of issuance of the
shares), based on the excess (if any) at that time or, if earlier, at the time
of the sale of such shares, of the fair market value of the shares received over
the option exercise price, and (ii) the holding period for purposes of
determining entitlement to long-term or short-term capital gain or loss, as the
case may be, will commence on the earlier of the date of sale of such shares or
the date that the Section 16(b) restrictions lapse. However, such an optionee
may elect under Section 83(b) of the Internal Revenue Code of 1986, as amended,
to be taxed at the time of exercise of the option, based on the excess (if any)
at the time of exercise of the fair market value of the shares received over the
option exercise price, in which event the holding period will commence on the
date of exercise. Optionees who are subject to Section 16(b) restrictions should
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consult a qualified tax advisor regarding the advisability of a Section 83(b)
election, which must be made within 30 days following the exercise of the
option.
Exercise of Non-Qualified Options with Common Stock
If shares previously acquired other than upon exercise of an incentive
stock option are surrendered in full or partial payment of the exercise price of
a non-qualified option, then no gain or loss will be recognized by the optionee,
on the date of exercise, for the shares which have an aggregate fair market
value equal to the aggregate fair market value of the shares surrendered. These
shares received are called replacement shares. The optionee will have a basis in
the replacement shares equal to the basis of the shares surrendered, and the
optionee's holding period (for purposes of determining entitlement to short-term
or long-term capital gain or loss treatment on a subsequent disposition of the
replacement shares) will generally include the period during which the
surrendered shares were held.
In the event that the optionee receives any additional shares in addition
to the replacement shares on such exercise, then (i) the excess of (a) the fair
market value of all of the shares received over, (b) the sum of (1) the fair
market value of the shares surrendered and (2)any cash payments made by the
optionee on the exercise of the option, will be treated as compensation taxable
as ordinary income (and subject to withholding), (ii) the optionee's basis in
the additional shares will be equal to the sum of the amount taxed as ordinary
income on exercise plus the amount of any cash payments made on exercise, and
(iii) the holding period for the additional shares (for purposes of determining
entitlement to long-term or short-term capital gain or loss treatment on a
subsequent disposition of the additional shares) will begin when such additional
shares are issued to the optionee.
Certain Federal Income Tax Consequences of Restricted Stock
A participant will not recognize income upon the award of restricted stock
unless the election described below is made. A participant who has not made such
an election will recognize ordinary income at the end of the applicable
restriction period in an amount equal to the fair market value of the restricted
stock at such time. Any dividends paid in stock will be treated as an award of
additional restricted stock subject to the tax treatment described herein.
Dividends paid in cash and received by a participant prior to the end of the
applicable restriction period will constitute ordinary income to the participant
in the year paid.
Nathan's will be entitled to an income tax deduction in the same amount of,
and the same time that, income is recognized by the participant, subject to the
requirement of reasonableness, certain limitations imposed by Section 162(m) of
the Code and the satisfaction of certain income and employment tax withholding
obligations.
Any gain or loss on the participant's subsequent disposition of the shares
of common stock will receive long or short-term capital gain or loss treatment,
depending on whether the shares are held for more than one year following the
end of the applicable restriction period. Nathan's will not be entitled to
receive an income tax deduction for any such gain.
A participant may, within thirty days after the date of the award of
restricted stock, elect to recognize ordinary income as of the date of the award
in an amount equal to the fair market value of such restricted stock on the date
of the award, determined without regard to any of the restrictions. If the
election is made, any cash dividends received with respect to the restricted
stock will be treated as dividend income to the participant in the year of
payment. Any dividends paid in stock will be treated as an award of additional
restricted stock subject to the tax treatment described herein.
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Nathan's will be entitled to an income tax deduction in the same amount of,
and the same time that, income is recognized by the participant, subject to the
requirement of reasonableness, certain limitations imposed by Section 162(m) of
the Code and the satisfaction of certain income and employment tax withholding
obligations.
Any gain or loss on the participant's subsequent disposition of the shares
of common stock (other than by forfeiture) will receive long or short-term
capital gain or loss treatment, depending on whether the shares are held for
more than one year following the date of grant of such restricted stock.
Nathan's will not be entitled to receive an income tax deduction for any such
gain.
If a participant who has made an election subsequently forfeits the
restricted stock, the participant will not be entitled to deduct any loss. In
addition, Nathan's would then be required to include as ordinary income the
amount of the deduction Nathan's originally claimed with respect to such shares.
Information Reporting
Pursuant to applicable tax regulations, Nathan's will provide to each
optionee and to the appropriate tax authorities information regarding the grant
of restricted stock and exercises of non-qualified options on Form W-2 or 1099.
RESTRICTION ON REOFFERS OR RESALES OF COMMON STOCK
ACQUIRED PURSUANT TO THE PLAN
Participants in the plan who receive shares of common stock pursuant to a
grant of restricted stock or the exercise of options may from time to time sell
all or a part of such common stock. In some instances, there may be restrictions
on the amount and manner of such sales by reason of pertinent provisions of the
securities laws and the rules thereunder. Optionees should consult with legal
counsel about the securities law implications of the acquisition or disposition
of shares of common stock under the plan.
Pursuant to Section 16(b) of the Exchange Act, if an optionee, while an
officer, director or ten percent (10%) stockholder of Nathan's, (i) acquires any
equity security of Nathan's (other than shares of common stock acquired under
the plan or another stock option plan of Nathan's if the exercise price of the
option pursuant to which such shares of common stock were acquired does not
exceed the fair market value thereof at the time of exercise), and (ii) within
six months before or after such acquisition sells any equity security of
Nathan's, including common stock acquired under the plan, then such optionee
will be required to repay to Nathan's any profit attributable to the two
transactions.
In the event of any inconsistency between this summary and the plan, the
terms of the plan shall govern.
This document constitutes part of a prospectus covering securities that
have been registered under the Securities Act of 1933.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
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The Registrant hereby incorporates by reference into this Registration
Statement the documents listed in (a), (b) and (c) below:
(a) The Registrant's Annual Report on Form 10-K for the fiscal year ended
March 31, 2002;
(b) The Registrant's Quarterly Report on Form 10-Q for the fiscal quarters
ended June 30, 2002 and September 29, 2002; and
(c) The description of the class of securities to be offered which is
contained in a registration statement filed under Section 12 of the
Securities Exchange Act of 1934 (File No. 0-3189) including any
amendment or report filed for the purpose of updating such
description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the
filing of a post-effective amendment which indicates that all securities offered
have been sold or which indicates that all securities offered have been sold or
which deregisters all such securities then remaining unsold, shall be deemed to
be incorporated by reference in this Registration Statement and to be a part
hereof from the date of filing of such documents.
Item 4. Description of Securities.
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Not applicable.
Item 5. Interests of Named Experts and Counsel.
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Not applicable.
Item 6. Indemnification of Directors and Officers.
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Under the provisions of the Certificate of Incorporation and By-Laws of
Registrant, each person who is or was a director or officer of Registrant shall
be indemnified by Registrant as of right to the full extent permitted or
authorized by the General Corporation Law of Delaware.
Under such law, to the extent that such person is successful on the merits
of defense of a suit or proceeding brought against him by reason of the fact
that he is a director or officer of Registrant, he shall be indemnified against
expenses (including attorneys' fees) reasonably incurred in connection with such
action.
If unsuccessful in defense of a third-party civil suit or a criminal suit
is settled, such a person shall be indemnified under such law against both (1)
expenses (including attorneys' fees) and (2) judgments, fines and amounts paid
in settlement if he acted in good faith and in a manner he reasonably believed
to be in, or not opposed to, the best interests of Registrant, and with respect
to any criminal action, had no reasonable cause to believe his conduct was
unlawful.
If unsuccessful in defense of a suit brought by or in the right of
Registrant, or if such suit is settled, such a person shall be indemnified under
such law only against expenses (including attorneys' fees) incurred in the
defense or settlement of such suit if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of
Registrant except that if such a person is adjudicated to be liable in such suit
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for negligence or misconduct in the performance of his duty to Registrant, he
cannot be made whole even for expenses unless the court determines that he is
fairly and reasonably entitled to be indemnified for such expenses.
The officers and directors of the Company are covered by officers' and
directors' liability insurance. The policy coverage is $7,500,000 which includes
reimbursement for costs and fees. There is a maximum aggregate deductible for
each loss under the policy of $250,000. The Company has entered into
Indemnification Agreements with certain of its officers and directors. The
Agreements provide for reimbursement for all direct and indirect costs of any
type or nature whatsoever (including attorneys' fees and related disbursements)
actually and reasonably incurred in connection with either the investigation,
defense or appeal of a Proceeding, as defined, including amounts paid in
settlement by or on behalf of an indemnitee.
Item 7. Exemption From Registration Claimed.
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Not applicable.
Item 8. Exhibits.
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4.1 Nathan's Famous, Inc. 2002 Stock Incentive Plan.
5 Opinion and consent of Blau, Kramer, Wactlar & Lieberman,
P.C.
23.1 Consent of Blau, Kramer, Wactlar & Lieberman, P.C. -
included in their opinion filed as Exhibit 5.
23.2 Consent of Grant Thornton LLP.
23.3 Consent of Arthur Andersen. *
24 Powers of Attorney.
________________
* omitted pursuant to Rule 437a
Item 9. Undertakings.
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(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in the Registration Statement;
(iii)To include any material information with respect to the
plan of distribution not previously disclosed in the
Registration Statement or any material change to such
information in the Registration Statement; provided,
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however, that paragraphs (a)(l)(i) and (a)(l)(ii) do
not apply if the information required to be included in
a post-effective amendment by those paragraphs is
contained in periodic reports filed by the Registrant
pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated
by reference in the Registration Statement.
(2) That, for the purposes of determining any liability under
the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against policy
as expressed in the Act and will be governed by final adjudication of such
issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Westbury, New York on the 19th day of November, 2002.
NATHAN'S FAMOUS, INC.
By: /s/ Wayne Norbitz
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Wayne Norbitz
President and Chief Operating Officer
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on November 19, 2002 by the
following persons in the capacities indicated. Each person whose signature
appears below constitutes and appoints Wayne Norbitz and Ronald G. DeVos, and
each of them acting individually, with full power of substitution, our true and
lawful attorneys-in-fact and agents to do any and all acts and things in our
name and on our behalf in our capacities indicated below which they or either of
them may deem necessary or advisable to enable Nathan's Famous, Inc. to comply
with the Securities Act of 1933, as amended, and any rules, regulations and
requirements of the Securities and Exchange Commission, in connection with this
Registration Statement including specifically, but not limited to, power and
authority to sign for us or any of us in our names in the capacities stated
below, any and all amendments (including post- effective amendments) thereto,
granting unto said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
such connection, as fully to all intents and purposes as we might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or his substitute or substitutes, may lawfully do or cause to be done by
virtue thereof.
Signature Title
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/s/ Howard M. Lorber Chairman of the Board and
Howard M. Lorber Chief Executive Officer
/s/ Wayne Norbitz President, Chief Operating Officer and
Wayne Norbitz Director (Principal Executive Officer)
/s/ Ronald G. DeVos Vice President - Finance
Ronald G. DeVos Chief Financial Officer and Secretary
(Principal Financial and Accounting Officer)
/s/ Robert J. Eide Director
Robert J. Eide
/s/ Brian S. Genson Director
Brian S. Genson
/s/ Donald Perlyn Director
Donald Perlyn
/s/ Attilio F. Petrocelli Director
Attilio F. Petrocelli
/s/ Barry Leistner Director
Barry Leistner
Exhibit 4
NATHAN'S FAMOUS, INC.
2002 STOCK INCENTIVE PLAN
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SECTION 1
GENERAL
1.1. Purpose. The Nathan's Famous, Inc. 2002 Stock Incentive Plan (the
"Plan") has been established by Nathan's Famous, Inc. (the "Company") to secure
for the Company and its Affiliates and Subsidiaries the benefits of the
additional incentive inherent in the ownership of the Company's Common Stock,
$0.01 par value (the "Stock"), by certain executive officers, other key
employees of and consultants to the Company and its Affiliates and Subsidiaries
and by Non-Employee Directors of the Company, all of whom are important to the
success and the growth of the business of the Company, and to help the Company
and its Affiliates and Subsidiaries secure and retain the services of such
persons.
1.2. Participation. Subject to the terms and conditions of the Plan, the
Committee shall determine and designate, from time to time, from among the
officers, key employees and consultants to the Company and its Affiliates and
Non-Employee Directors to the Company, those persons who will be granted one or
more Awards under the Plan, and thereby become "Participants" in the Plan.
1.3. Definitions. Capitalized terms in the Plan are defined as set forth in
the Plan (including the definition provisions of subsection 8.1 of the Plan).
SECTION 2
OPTIONS
2.1. Option. The grant of an "Option" entitles the Participant to purchase
shares of Stock at an Exercise Price established by the Committee. Any Option
granted under the Plan will be a non-qualified option.
2.2. Exercise Price. The "Exercise Price" of each Option granted under the
Plan shall be established by the Committee or shall be determined by a method
established by the Committee at the time the Option is granted, except that the
Exercise Price shall not be less than 100% of the Fair Market Value of a share
of Stock on the date of grant.
2.3. Exercise.
(a) By an Employee:
Unless otherwise provided by the Committee and except in the
manner described below upon the death of the Participant, an
Option may be exercised only in installments as follows: up to
one-half of the subject shares on and after the first anniversary
of the date of grant and up to the balance of the subject shares
on and after the second such anniversary of the date of the grant
of such Option but in no event later than the expiration of the
term of the Option.
An Option shall be exercisable during the Participant's lifetime
only by the Participant and shall not be exercisable by the
Participant unless, at all times since the date of grant and at
the time of exercise, such Participant is an employee of or
providing services to the Company, or any Affiliate or
Subsidiary, except that, upon termination of all such employment
or provision of services (other than by death, Total Disability,
or by Total Disability followed by death in the circumstances
provided below), the Participant may exercise an Option at any
time within three months thereafter but only to the extent such
Option is exercisable on the date of such termination.
Upon termination of all such employment by Total Disability, the
Participant may exercise such Options at any time within one year
thereafter, but only to the extent such Option is exercisable on
the date of such termination.
In the event of the death of an Participant (i) while an employee
of or providing services to the Company, or any Affiliate or
Subsidiary, or (ii) within three months after termination of all
such employment or provision of services (other than for Total
Disability) or (iii) within one year after termination on account
of Total Disability of all such employment or provision of
services, such Participant's estate or any person who acquires
the right to exercise such option by bequest or inheritance or by
reason of the death of the Participant may exercise such
Participant's Option at any time within the period of two years
from the date of death. In the case of clauses (i) and (iii)
above, such Option shall be exercisable in full for all the
remaining shares covered thereby, but in the case of clause (ii)
such Option shall be exercisable only to the extent it was
exercisable on the date of such termination of employment or
service.
(b) By Persons other than Employees:
If the Participant is not an employee of the Company or any
Affiliate or Subsidiary, the vesting of such Participant's right
to exercise his Options shall be established and determined by
the Committee in the Option Agreement covering the Options
granted to such Participant.
Notwithstanding the foregoing provisions regarding the exercise
of an Option in the event of death, Total Disability, other
termination of employment or provision of services or otherwise,
in no event shall an Option be exercisable in whole or in part
after the termination date provided in the Option Agreement.
2.4. Payment of Exercise Price. The payment of the Exercise Price of an
Option shall be subject to the following:
(a) Except as provided in the remainder of this subsection 2.4, the
entire Exercise Price for shares of Stock purchased upon the
exercise of an Option shall be paid at the time of such exercise.
(b) The Exercise Price shall be payable in cash or by tendering,
through either actual delivery of shares or through attestation,
shares of Stock held by the Participant and otherwise acceptable
to the Committee, and valued at Fair Market Value as of the day
prior to the day of exercise (or if the Committee determines, as
of the day of exercise), or in any combination of such shares and
cash, as determined by the Committee.
(c) The Committee may permit a Participant to elect to pay the
Exercise Price upon the exercise of an Option by irrevocably
authorizing a third party to sell shares of Stock (or a
sufficient portion of the shares) acquired upon exercise of the
Option and remit to the Company a sufficient portion of the sale
proceeds to pay the entire Exercise Price and any tax withholding
resulting from such exercise. In the case of an exercise
arrangement described in the preceding sentence, payment of the
Exercise Price may be made as soon as practicable after the
exercise.
2
SECTION 3
RESTRICTED STOCK AWARDS
3.1. Definitions. A "Restricted Stock" Award is a grant of shares of Stock,
with such shares of Stock subject to a risk of forfeiture or other restrictions
that will lapse upon the achievement of one or more goals relating to completion
of service by the Participant, or achievement of performance or other
objectives, as determined by the Committee.
3.2. Restrictions on Awards. Each Restricted Stock Award shall be subject
to such conditions, restrictions and contingencies as the Committee shall
determine, including the satisfaction of conditions that must be satisfied prior
to the grant of the Award; provided, that the period during which shares of
stock are subject to restriction shall be no less than one year unless sooner
terminated pursuant to Section 3.3; provided, further, that the restrictions may
lapse ratably during such period.
3.3 Effect of Termination of Employment or Provision of Services. Unless
otherwise provided by the Committee, upon termination of a Participant's
employment or provision of services to the Company or any Affiliate or
Subsidiary during any restriction period for any reason other than death or
Total Disability, all shares of Restricted Stock subject to a Restricted Stock
Award will be forfeited to the Company. Upon termination of a Participant's
employment due to death or Total Disability, all restrictions on any Restricted
Stock Award will immediately lapse and the Participant will take the shares of
Restricted Stock subject to a Restricted Stock Award free and clear of any such
restrictions.
3.4 Legend. Each certificate for shares transferred or issued to a
Participant pursuant to a Restricted Stock Award shall be registered in the name
of the Participant and shall bear the following (or a similar) legend:
"THE CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE
SUBJECT TO THE TERMS AND CONDITIONS CONTAINED IN THE NATHAN'S
FAMOUS, INC. 2002 STOCK INCENTIVE PLAN (THE "PLAN") APPLICABLE TO
RESTRICTED SHARES AND TO A RESTRICTED SHARE AGREEMENT DATED
(THE "AGREEMENT"), AND MAY NOT BE SOLD, PLEDGED, TRANSFERRED,
ASSIGNED, HYPOTHECATED, OR OTHERWISE DISPOSED OF OR ENCUMBERED IN
ANY MANNER DURING THE RESTRICTED PERIOD SPECIFIED IN SUCH
AGREEMENT. COPIES OF SUCH PLAN AND AGREEMENT ARE ON FILE WITH THE
SECRETARY OF THE COMPANY."
SECTION 4
OPERATION AND ADMINISTRATION
4.1. Effective Date. Subject to the approval of the stockholders of the
Company at the Company's 2002 annual meeting of stockholders, the Plan shall be
effective as of June 17, 2002, the date of the adoption of the Plan by the Board
of Directors (the "Effective Date"). The Plan shall be unlimited in duration
and, in the event of Plan termination, shall remain in effect as long as any
Awards are outstanding. However, except for Awards granted pursuant to
commitments entered into prior to such ten-year anniversary, no Awards may be
granted after the ten-year anniversary of the Effective Date.
4.2. Shares Subject to Plan. The shares of Stock for which Awards may be
granted under the Plan shall be subject to the following:
(a) The shares of Stock may be authorized but unissued shares or
treasury shares. As used herein, the term "issued" and similar
terms include treasury shares delivered under an Award.
(b) Subject to the following provisions of this subsection 4.2, the
maximum number of shares of Stock that may be delivered to
Participants and their beneficiaries under the Plan shall be
300,000 shares.
3
(c) Notwithstanding the terms of subsections 4.2(d) and (e), the
following additional limits are imposed under the Plan.
(i) The maximum number of shares that may be covered by Awards
granted to any one employee shall be 100,000 shares. If an
Award is terminated, cancelled or expires, or the shares
under an Award are forfeited, the number of shares subject
to the Award shall be counted for purposes of applying such
limit.
(ii) The maximum number of shares that may be issued in
conjunction with Awards granted pursuant to Section 3
(relating to Restricted Stock) shall be 100,000 shares.
(d) To the extent any shares of Stock covered by an Award are not
delivered to a Participant or beneficiary because the Award is
forfeited, canceled, or expires, or if the shares are delivered
but subsequently forfeited, or the shares of Stock are not
delivered because the Award is used to satisfy the applicable tax
withholding obligation, such shares shall not be deemed to have
been delivered for purposes of determining the maximum number of
shares of Stock available for delivery under subsections 4.2(b)
and 4.2(c)(ii). If the Exercise Price of any Option is satisfied
by tendering shares of Stock to the Company (by either actual
tender or by attestation), only the number of shares of Stock
issued net of the shares of Stock tendered shall be deemed
delivered for purposes of determining the maximum number of
shares of Stock available for delivery under subsections 4.2(b)
and 4.2(c)(ii).
(e) In the event of a corporate transaction involving the Company
(including, without limitation, any stock dividend, stock split,
extraordinary cash dividend, recapitalization, reorganization,
merger, consolidation, split-up, spin-off, combination or
exchange of shares), the Committee shall, to the extent deemed
appropriate, adjust the shares of Stock that may be issued under
the Plan in the same proportion and shall also so adjust Awards
to preserve the benefits or potential benefits of the Awards.
Action by the Committee may include: (i) adjustment of the number
and kind of shares which may be delivered under the Plan; (ii)
adjustment of the number and kind of shares subject to
outstanding Awards; (iii) adjustment of the Exercise Price of
outstanding Options; and (iv) any other adjustments that the
Committee determines to be equitable.
4.3. General Restrictions. Delivery of shares of Stock or other amounts
under the Plan shall be subject to the following:
(a) Notwithstanding any other provision of the Plan, the Company
shall have no liability to deliver any shares of Stock or make
any other distribution of benefits unless such delivery or
distribution would comply with all applicable laws (including,
without limitation, the requirements of the Securities Act of
1933), and the applicable requirements of any stock exchange or
similar entity.
(b) To the extent that the Plan provides for issuance of stock
certificates to reflect the issuance of shares of Stock, the
issuance may be effected on a on-certificated basis, to the
extent not prohibited by applicable law or the applicable rules
of any stock exchange.
4.4. Tax Withholding. Delivery of shares of Stock or other amounts under
the Plan is subject to withholding of all applicable taxes, and the Committee
may condition the delivery of any shares of Stock or other amounts under the
Plan on satisfaction of the applicable withholding obligations. The Committee,
in its discretion, and subject to such requirements as the Committee may impose
prior to the occurrence of such withholding, may permit such withholding
obligations to be satisfied through cash payment by the Participant, through the
surrender of shares of Stock which the Participant already owns, or through the
surrender of shares of Stock to which the Participant is otherwise entitled
under the Plan.
4
4.5. Grant and Use of Awards. In the discretion of the Committee, a
Participant may be granted any Award permitted under the provisions of the Plan,
and more than one Award may be granted to a Participant. Awards may be granted
as alternatives to or replacement of Awards granted or outstanding under the
Plan, or any other plan or arrangement of the Company (including a plan or
arrangement of a business or entity, all or a portion of which is acquired by
the Company or an Affiliate or Subsidiary). Subject to the overall limitation on
the number of shares of Stock that may be delivered under the Plan, the
Committee may use available shares of Stock as the form of payment for
compensation, grants or rights earned or due under any other compensation plans
or arrangements of the Company or an Affiliate or Subsidiary, including the
plans and arrangements of the Company or an Affiliate or Subsidiary assumed in
business combinations.
4.6. Dividends and Dividend Equivalents. An Award (including without
limitation an Option Award) may provide the Participant with the right to
receive dividend payments or dividend equivalent payments with respect to Stock
subject to the Award (both before and after the Stock subject to the Award is
earned, vested, or acquired), which payments may be either made currently or
credited to an account for the Participant, and may be settled in cash or Stock,
as determined by the Committee. Any such settlements, and any such crediting of
dividends or dividend equivalents or reinvestment in shares of Stock, may be
subject to such conditions, restrictions and contingencies as the Committee
shall establish, including the reinvestment of such credited amounts in Stock
equivalents.
4.7. Transferability. Except as otherwise provided by the Committee, Awards
under the Plan are not transferable except as designated by the Participant by
will or by the laws of descent and distribution.
4.8. Form and Time of Elections. Unless otherwise specified herein, each
election required or permitted to be made by any Participant or other person
entitled to benefits under the Plan, and any permitted modification, or
revocation thereof, shall be in writing filed with the Committee at such times,
in such form, and subject to such restrictions and limitations, not inconsistent
with the terms of the Plan, as the Committee shall require.
4.9. Agreement With Company. An Award under the Plan shall be subject to
such terms and conditions, not inconsistent with the Plan, as the Committee
shall, in its sole discretion, prescribe. The terms and conditions of any Award
to any Participant shall be reflected in such form of written document as is
determined by the Committee. A copy of such document shall be provided, or
otherwise made available, to the Participant, and the Committee may, but need
not, require that the Participant sign a copy of such document. Such document is
referred to in the Plan as an "Award Agreement" regardless of whether any
Participant signature is required.
4.10. Action by Company, Affiliate or Subsidiary. Any action required or
permitted to be taken by the Company or any Affiliate or Subsidiary shall be by
resolution of its board of directors, or by action of one or more members of the
board (including a committee of the board) who are duly authorized to act for
the board, or (except to the extent prohibited by applicable law or applicable
rules of any stock exchange) by a duly authorized officer of such company.
4.11. Gender and Number. Where the context permits, words in any gender
shall include any other gender, words in the singular shall include the plural
and the plural shall include the singular.
4.12. Limitation of Implied Rights.
(a) Neither a Participant nor any other person shall, by reason of
participation in the Plan, acquire any right in or title to any
assets, funds or property of the Company or any Affiliate or
Subsidiary whatsoever, including, without limitation, any
specific funds, assets, or other property which the Company or
any Affiliate or Subsidiary, in its sole discretion, may set
aside in anticipation of a liability under the Plan.
(b) The Plan does not constitute a contract of employment, in the
case of a Participant who is an employee, or an agreement to
renominate a director as a director, in the case of a Participant
who is a Non-Employee Director, and selection as a Participant
will not give any participating employee or Non-Employee Director
the right to be retained in the employ, or remain a director, of
the Company or any Affiliate or Subsidiary, nor any right or
5
claim to any benefit under the Plan, unless such right or claim
has specifically accrued under the terms of the Plan. Except as
otherwise provided in the Plan, no Award under the Plan shall
confer upon the holder thereof any rights as a stockholder of the
Company prior to the date on which the Participant fulfills all
conditions for receipt of such rights.
4.13. Evidence. Evidence required of anyone under the Plan may be by
certificate, affidavit, document or other information which the person acting on
it considers pertinent and reliable, and signed, made or presented by the proper
party or parties.
SECTION 5
CHANGE IN CONTROL
Subject to the provisions of subsection 4.2(e) (relating to the adjustment
of shares), and except as otherwise provided in the Plan or the Award Agreement
reflecting the applicable Award, upon the occurrence of a Change in Control, at
the option of the Committee:
(a) All outstanding Options shall become fully exercisable.
(b) All Restricted Stock shall become fully vested.
SECTION 6
COMMITTEE
6.1. Administration. The authority to control and manage the operation and
administration of the Plan shall be vested in a committee (the "Committee") in
accordance with this Section 6. The Committee shall be selected by the Board,
and shall consist of at least two members and shall be appointed from among the
members of the Board. Any member of the Committee may resign or be removed by
the Board and new members may be appointed by the Board. Additionally, the
Committee shall be constituted so as to satisfy the non-employee director
provisions of Rule 16b-3 promulgated under the Securities Exchange Act of 1934,
as amended. Unless otherwise determined by the Board, the Committee shall be the
Compensation Committee. If the Committee does not exist, or for any other reason
determined by the Board, the Board may take any action under the Plan that would
otherwise be the responsibility of the Committee.
6.2. Powers of Committee. The Committee's administration of the Plan shall
be subject to the following:
(a) Subject to the provisions of the Plan, the Committee will have
the authority and discretion to select those persons who shall
receive Awards, to determine the time or times of receipt, to
determine the types of Awards and the number of shares covered by
the Awards, to establish the terms, conditions, performance
criteria, restrictions, and other provisions of such Awards, and
(subject to the restrictions imposed by Section (7), to cancel
Awards.
(b) To the extent that the Committee determines that the restrictions
imposed by the Plan preclude the achievement of the material
purposes of the Awards in jurisdictions outside the United
States, the Committee will have the authority and discretion to
modify those restrictions as the Committee determines to be
necessary or appropriate to conform to applicable requirements or
practices of jurisdictions outside of the United States.
(c) The Committee will have the authority and discretion to interpret
the Plan, to establish, amend, and rescind any rules and
regulations relating to the Plan, to determine the terms and
provisions of any Award Agreement made pursuant to the Plan, and
to make all other determinations that may be necessary or
advisable for the administration of the Plan.
6
(d) Any interpretation of the Plan by the Committee and any decision
made by it under the Plan, including an adjustment under
subsection 4.2(e), is final and binding on all persons. Except to
the extent precluded by applicable law governing discrimination
in employment, decisions made by the Committee under the Plan
need not be uniform with respect to Participants notwithstanding
that Participants are similarly situated.
6.3. Information to be Furnished to Committee. The Company, Affiliates and
Subsidiaries shall furnish the Committee with such data and information as it
determines may be required for it to discharge its duties. The records of the
Company, Affiliates and Subsidiaries as to an employee's or Participant's
employment, termination of employment, leave of absence, reemployment and
compensation shall be conclusive on all persons unless determined to be
incorrect. Participants and other persons entitled to benefits under the Plan
must furnish the Committee such evidence, data or information as the Committee
considers desirable to carry out the terms of the Plan.
SECTION 7
AMENDMENT AND TERMINATION
The Board or the Committee may, at any time, amend or terminate the Plan,
except that the Board may amend the Plan to prohibit or restrict the Committee's
power to amend or terminate the Plan after the time at which such amendment is
adopted by the Board, and any such amendment by the Board shall not be subject
to change by the Committee. Notwithstanding the foregoing sentence, (i) no
amendment or termination may, in the absence of written consent to the change by
the affected Participant (or, if the Participant is not then living, the
affected beneficiary of the former Participant), adversely affect the rights of
any Participant or beneficiary under any Award prior to the date such amendment
is adopted; (ii) no amendment may increase the limitations on the number of
shares set forth in subsections 4.2(b) and 4.2(c) or decrease the minimum Option
Exercise Price set forth in subsection 2.2, or increase the maximum term of an
Option from the maximum term set forth in subsection 2.3 unless any such
amendment is approved by the Company's stockholders. No outstanding Options may
be repriced without the prior approval of the Company's stockholders.
Adjustments pursuant to subsection 4.2(e) shall not be subject to the foregoing
limitations of this Section 7.
SECTION 8
DEFINED TERMS AND GOVERNING LAW
8.1. Defined Terms. In addition to the other definitions contained herein,
the following definitions shall apply:
(a) Affiliate. The term "Affiliate" means any person or entity
controlled by or under common control with the Company, by virtue
of the ownership of voting securities, by contract or otherwise.
(b) Award. The term "Award" shall mean any award or benefit granted
under the Plan, including, without limitation, the grant of
Options and Restricted Stock Awards.
(c) Board. The term "Board" shall mean the Board of Directors of the
Company.
(d) Change in Control. The term "Change in Control" shall mean a
change in control as such term is presently defined in Regulation
240.12b-(f) under the Securities Exchange Act of 1934; or if any
"person" (as such term is used in Section 13(d) and 14(d) of the
Exchange Act) other than Nathan's or any "person" who on the date
of the adoption of the 2002 Plan is a director or officer of
Nathan's, becomes the "beneficial owner" (as defined in Rule
13(d)-3 under the Exchange Act) directly or indirectly, of
securities representing twenty percent (20%) or more of the
voting power of Nathan's then outstanding securities; or if
during any period of two (2) consecutive years during the term of
the 2002 Plan, individuals who at the beginning of such period
constitute the Board of Directors, cease for any reason to
constitute at least a majority of the board.
7
(e) Code. The term "Code" shall mean the Internal Revenue Code of
1986, as amended. A reference to any provision of the Code shall
include reference to any successor provision of the Code.
(f) Fair Market Value. For purposes of determining the "Fair Market
Value" of a share of Stock as of any date, the following rules
shall apply:
(i) If the principal market for the Stock is a national
securities exchange or the Nasdaq stock market, then the
"Fair Market Value" as of that date shall be the last
reported sale price of the Stock on that date on the
principal exchange or market on which the Stock is then
listed or admitted to trading.
(ii) If the last sale price is not available or if the principal
market for the Stock is not a national securities exchange
and the Stock is not quoted on the Nasdaq stock market, then
the "Fair Market Value" as of that date shall be the average
between the highest bid and lowest asked prices for the
Stock on such day as reported on the Nasdaq OTC Bulletin
Board Service or by the National Quotation Bureau,
Incorporated or a comparable service.
(iii)If the day is not a business day, and as a result,
paragraphs (i) and (ii) next above are inapplicable, the
"Fair Market Value" of the Stock shall be determined as of
the next earlier business day. If paragraphs (i) and (ii)
next above are otherwise inapplicable, then the "Fair Market
Value" of the Stock shall be determined in good faith by the
Committee.
(g) Non-Employee Directors. The term "Non-Employee Director" means a
member of the Board who is not an employee of the Company, any
Subsidiary or of any person, directly or indirectly, controlling,
controlled by or under common control with the Company and is not
a member of the Board representing a particular holder of any
class of securities of the Company and satisfying the conditions
set forth in Rule 16b-3 promulgated under the Securities Exchange
Act of 1934, as amended, or any successor provision.
(h) Subsidiary. The term "Subsidiary" and its plural means any
company during any period in which it is a "subsidiary
corporation" (as that term is defined in Code Section 424(f))
with respect to the Company.
(i) Total Disability. Means accidental bodily injury or sickness
which wholly and continuously disabled a Participant. The
Committee, whose decisions shall be final, shall make a
determination of Total Disability.
The following terms are defined where indicated below:
Award Agreement Subsection 4.10
Committee Subsection 6.1
Exercise Price Subsection 2.2
Option Subsection 2.1(a)
Participant Subsection 1.2
Purchased Stock Subsection 3.2
Stock Subsection 1.1
Restricted Stock Subsection 3.1
8.2. Governing Law. This Plan, and all Award Agreements, shall be construed
in accordance with and governed by the laws of the State of New York, without
reference to any conflict of law principles. Any legal action or proceeding with
respect to this Plan, any Award or any Award Agreement, or for recognition and
enforcement of any judgment in respect of this Plan, any Award or any Award
8
Agreement, may be brought and determined only in a state court sitting in the
County of Nassau, or the Federal District Court for the Eastern District of New
York sitting in the County of Nassau, in the State of New York.
9
Exhibit 5
November 19, 2002
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Nathan's Famous, Inc.
Registration Statement on Form S-8
----------------------------------
Gentlemen:
Reference is made to the filing by Nathan's Famous, Inc. (the
"Corporation") of a Registration Statement on Form S-8 with the Securities and
Exchange Commission pursuant to the provisions of the Securities Act of 1933, as
amended, covering the registration of 300,000 shares of the Corporation's Common
Stock, $.01 par value per share, in connection with the Corporation's 2002 Stock
Incentive Plan (the "Plan").
As counsel for the Corporation, we have examined its corporate records,
including its Certificate of Incorporation, as amended, By-Laws, its corporate
minutes, the form of its Common Stock certificate, the Plan, related documents
under the Plan and such other documents as we have deemed necessary or relevant
under the circumstances.
Based upon our examination, we are of the opinion that:
1. The Corporation is duly organized and validly existing under the laws of
the State of Delaware.
2. There have been reserved for issuance by the Board of Directors of the
Corporation 300,000 shares of its Common Stock, $.01 par value per share. The
shares of the Corporation's Common Stock, when issued pursuant to the Plan, will
be validly authorized, legally issued, fully paid and non-assessable.
We hereby consent to be named in the Registration Statement and in the
Prospectus which constitutes a part thereof as counsel of the Corporation, and
we hereby consent to the filing of this opinion as Exhibit 5 to the Registration
Statement.
Very truly yours,
/s/ Blau, Kramer, Wactlar & Lieberman, P.C.
BLAU, KRAMER, WACTLAR &
LIEBERMAN, P.C.
Exhibit 23.2
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We have issued our report dated May 24, 2002 (except for Note N-2, as to which
the date is May 29, 2002) accompanying the consolidated financial statements and
schedule of Nathan's Famous, Inc. and subsidiaries appearing in the 2002 Annual
Report of the Company on Form 10-K for the year ended March 31, 2002, which is
incorporated by reference in this Registration Statement. We consent to the
incorporation by reference in the Registration Statement of the aforementioned
report.
/s/ GRANT THORNTON LLP
Melville, New York
November 18, 2002