Unassociated Document


    
      

        EXHIBIT
          10.77



      BUSINESS
        LOAN AGREEMENT

      


      
        	
                Principal

              	
                Loan
                  Date

              	
                Expiration

              	
                Loan
                  No

              	
                Call
                  / Coll

              	
                Account

              	
                Officer

              	
                Initials

              
	
                $5,000,000.00

              	
                05-13-2008

              	
                05-13-2010

              	
                
                  400461335

                

              	 	
                Port
                  #583277

              	
                247

              	 


        
          

        

      

      References
        in the boxes above are for Lender's use only and do not limit the applicability
        of this document to any particular loan or item.

      Any
        item
        above containing "***" has been omitted due to text length
        limitations.

      
        
          

        

      

      
        	
                Borrower:

              	
                Rubio's
                  Restaurants, Inc., a Delaware corporation

                1902
                  Wright Place, Suite 300

                Carlsbad,
                  CA 92008

              	
                Lender:

              	
                Pacific
                  Western Bank

                Pasadena
                  Office

                150
                  South Los Robles

                Suite
                  100

                Pasadena,
                  CA 91101

              


      

       

      THIS
        BUSINESS LOAN AGREEMENT dated May 13, 2008, is made and executed between
        Rubio's
        Restaurants, Inc., a Delaware corporation ("Borrower") and Pacific Western
        Bank
        ("Lender") on the following terms and conditions. Borrower has received prior
        commercial loans from Lender or has applied to Lender for a commercial loan
        or
        loans or other financial accommodations, including those which may be described
        on any exhibit or schedule attached to this Agreement. Borrower understands
        and
        agrees that: (A) in granting, renewing, or extending any Loan, Lender is
        relying
        upon Borrower's representations, warranties, and agreements as set forth
        in this
        Agreement; (B) the granting, renewing, or extending of any Loan by Lender
        at all
        times shall be subject to Lender's sole judgment and discretion; and (C)
        all
        such Loans shall be and remain subject to the terms and conditions of this
        Agreement.

       

      TERM.
        This
        Agreement shall be effective as of May 13, 2008, and shall continue in full
        force and effect until such time as all of Borrower's Loans in favor of Lender
        have been paid in full, including principal, interest, costs, expenses,
        attorneys' fees, and other fees and charges, or until such time as the parties
        may agree in writing to terminate this Agreement.

       

      ADVANCE
        AUTHORITY.
        The
        following person or persons are authorized to request advances and authorize
        payments under the line of credit until Lender receives from Borrower, at
        Lender's address shown above, written notice of revocation of such
        authority:
        Daniel E. Pittard or Frank Henigman.

       

      CONDITIONS
        PRECEDENT TO EACH ADVANCE.
        Lender's
        obligation to make the initial Advance and each subsequent Advance under
        this
        Agreement shall be subject to the fulfillment to Lender's satisfaction of
        all of
        the conditions set forth in this Agreement and in the Related Documents.
        

       

      Loan
        Documents.
        Borrower
        shall provide to Lender the following documents for the Loan: (1) the Note;
        (2)
        Security Agreements granting to Lender security interests in the Collateral;
        (3)
        financing statements and all other documents perfecting Lender's Security
        Interests; (4) evidence of insurance as required below; (5) guaranties; (6)
        together with all such Related Documents as Lender may require for the Loan;
        all
        in form and substance satisfactory to Lender and Lender's counsel.

       

      Borrower's
        Authorization.
        Borrower
        shall have provided in form and substance satisfactory to Lender properly
        certified resolutions, duly authorizing the execution and delivery of this
        Agreement, the Note and the Related Documents. In addition, Borrower shall
        have
        provided such other resolutions, authorizations, documents and instruments
        as
        Lender or its counsel, may require.

       

      Payment
        of Fees and Expenses.
        Borrower
        shall have paid to Lender all fees, charges, and other expenses which are
        then
        due and payable as specified in this Agreement or any Related
        Document.

       

      Representations
        and Warranties.
        The
        representations and warranties set forth in this Agreement, in the Related
        Documents, and in any document or certificate delivered to Lender under this
        Agreement are true and correct.

       

      No
        Event of Default.
        There
        shall not exist at the time of any Advance a condition which would constitute
        an
        Event of Default under this Agreement or under any Related
        Document.

       

      REPRESENTATIONS
        AND WARRANTIES.
        Borrower
        represents and warrants to Lender, as of the date of this Agreement, as of
        the
        date of each disbursement of loan proceeds, as of the date of any renewal,
        extension or modification of any Loan, and at all times any Indebtedness
        exists:

       

      Organization.
        Borrower
        is a corporation for profit which is, and at all times shall be, duly organized,
        validly existing, and in good standing under and by virtue of the laws of
        the
        State of Delaware. Borrower is duly authorized to transact business in all
        other
        states in which Borrower is doing business, having obtained all necessary
        filings, governmental licenses and approvals for each state in which Borrower
        is
        doing business, except where failure would not have a material adverse affect
        on
        its business or financial condition. Specifically, Borrower is, and at all
        times
        shall be, duly qualified as a foreign corporation in all states in which
        the
        failure to so qualify would have a material adverse effect on its business
        or
        financial condition. Borrower has the full power and authority to own its
        properties and to transact the business in which it is presently engaged
        or
        presently proposes to engage. Borrower maintains an office at 1902 Wright
        Place,
        Suite 300, Carlsbad, CA 92008. Unless Borrower has designated otherwise in
        writing, the principal office is the office at which Borrower keeps its books
        and records including its records concerning the Collateral. Borrower will
        notify Lender prior to any change in the location of Borrower's state of
        organization or any change in Borrower's name. Borrower shall do all things
        necessary to preserve and to keep in full force and effect its existence,
        rights
        and privileges, and shall comply with all regulations, rules, ordinances,
        statutes, orders and decrees of any governmental or quasi-governmental authority
        or court applicable to Borrower and Borrower's business activities, except
        where
        failure would not have a material adverse affect on its business or financial
        condition.

       

      Assumed
        Business Names.
        Borrower
        has filed or recorded all documents or filings required by law relating to
        all
        assumed business names used by Borrower. Excluding the name of Borrower,
        the
        following is a complete list of all assumed business names under which Borrower
        does business:
        None.

       

      Authorization.
        Borrower's execution, delivery, and performance of this Agreement and all
        the
        Related Documents have been duly authorized by all necessary action by Borrower
        and do not conflict with, result in a violation of, or constitute a default
        under (1) any provision of (a) Borrower's articles of incorporation or
        organization, or bylaws, or (b) any agreement or other instrument binding
        upon
        Borrower or (2) any law, governmental regulation, court decree, or order
        applicable to Borrower or to Borrower's properties, except with respect to
        (1)(b) and (2), where failure would not have a material adverse affect on
        its
        business or financial condition.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      Financial
        Information.
        Each of
        Borrower's financial statements supplied to Lender truly and completely
        disclosed Borrower's financial condition as of the date of the statement
        in all
        material respects and in conformance with GAAP, and there has been no material
        adverse change in Borrower's financial condition subsequent to the date of
        the
        most recent financial statement supplied to Lender. Borrower has no material
        contingent obligations except as disclosed to Lender in such financial
        statements or as otherwise disclosed to Lender in Schedule
        1
        to the
        Disclosure Schedule.

       

      Legal
        Effect.
        This
        Agreement constitutes, and any instrument or agreement Borrower is required
        to
        give under this Agreement when delivered will constitute legal, valid, and
        binding obligations of Borrower enforceable against Borrower in accordance
        with
        their respective terms.

       

      Properties.
        Except
        as contemplated by this Agreement (including Permitted Liens) or the Guidance
        Line or as previously disclosed in Borrower's financial statements or in
        writing
        to Lender and as accepted by Lender, and except for property tax liens for
        taxes
        not presently due and payable, Borrower owns and has good title to all of
        Borrower's properties free and clear of all Security Interests, and has not
        executed any security documents or financing statements relating to such
        properties. All of Borrower's properties are titled in Borrower's legal name,
        and Borrower has not used or filed a financing statement under any other
        name
        for at least the last five (5) years.

       

      Hazardous
        Substances.
        Except
        as disclosed to and acknowledged by Lender in writing, Borrower represents
        and
        warrants that: (1) During the period of Borrower's ownership of the Collateral,
        there has been no use, generation, manufacture, storage, treatment, disposal,
        release or threatened release of any Hazardous Substance by any person on,
        under, about or from any of the Collateral. (2) Borrower has no knowledge
        of, or
        reason to believe that there has been (a) any breach or violation of any
        Environmental Laws; (b) any use, generation, manufacture, storage, treatment,
        disposal, release or threatened release of any Hazardous Substance on, under,
        about or from the Collateral by any prior owners or occupants of any of the
        Collateral; or (c) any actual or threatened litigation or claims of any kind
        by
        any person relating to such matters. (3) Neither Borrower nor any tenant,
        contractor, agent or other authorized user of any of the Collateral shall
        use,
        generate, manufacture, store, treat, dispose of or release any Hazardous
        Substance on, under, about or from any of the Collateral; and any such activity
        shall be conducted in compliance with all applicable federal, state, and
        local
        laws, regulations, and ordinances, including without limitation all
        Environmental Laws. Borrower authorizes Lender and its agents to enter upon
        Borrower’s premises to make such inspections and tests as Lender may deem
        appropriate to determine compliance of the Collateral with this section of
        the
        Agreement. Any inspections or tests made by Lender shall be at Borrower's
        expense (not to exceed $750 per day), upon prior written notice and not more
        frequently than annually, and for Lender's purposes only and shall not be
        construed to create any responsibility or liability on the part of Lender
        to
        Borrower or to any other person. The representations and warranties contained
        herein are based on Borrower's due diligence in investigating the Collateral
        for
        hazardous waste and Hazardous Substances. Borrower hereby (1) releases and
        waives any future claims against Lender for indemnity or contribution in
        the
        event Borrower becomes liable for cleanup or other costs under any such laws,
        and (2) agrees to indemnify, defend, and hold harmless Lender against any
        and
        all claims, losses, liabilities, damages, penalties, and expenses which Lender
        may directly or indirectly sustain or suffer resulting from a breach of this
        section of the Agreement or as a consequence of any use, generation,
        manufacture, storage, disposal, release or threatened release of a hazardous
        waste or substance on the Collateral, except in the event of Lender’s gross
        negligence or willful misconduct. The provisions of this section of the
        Agreement, including the obligation to indemnify and defend, shall survive
        the
        payment of the Indebtedness and the termination, expiration or satisfaction
        of
        this Agreement and shall not be affected by Lender's acquisition of any interest
        in any of the Collateral, whether by foreclosure or otherwise.

       

      Litigation
        and Claims.
        Except
        as set forth on Schedule
        1
        to the
        Disclosure Schedule, no litigation, claim, investigation, administrative
        proceeding or similar action (including those for unpaid taxes) against Borrower
        is pending or threatened, and no other event has occurred which may materially
        adversely affect Borrower's financial condition or properties. 

       

      Taxes.
        To the
        best of Borrower's knowledge, all of Borrower's tax returns and reports that
        are
        or were required to be filed, have been filed, and all taxes, assessments
        and
        other governmental charges have been paid in full, except as set forth on
        Schedule
        2
        to the
        Disclosure Schedule, that are presently being or to be contested by Borrower
        in
        good faith in the ordinary course of business and for which adequate reserves
        have been provided. 

       

      Lien
        Priority.
        Except
        as set forth in Schedule
        3
        to the
        Disclosure Schedule and other than Permitted Liens, Borrower has not entered
        into or granted any Security Agreements, or permitted the filing or attachment
        of any Security Interests on or affecting any of the Collateral directly
        or
        indirectly securing repayment of Borrower's Loan and Note, that would be
        prior
        or that may in any way be superior to Lender's Security Interests and rights
        in
        and to such Collateral.

       

      Binding
        Effect.
        This
        Agreement, the Note, all Security Agreements (if any), and all Related Documents
        are binding upon the signers thereof, as well as upon their successors,
        representatives and assigns, and are legally enforceable in accordance with
        their respective terms.

       

      AFFIRMATIVE
        COVENANTS.
        Borrower
        covenants and agrees with Lender that, so long as this Agreement remains
        in
        effect, Borrower will:

       

      Notices
        of Claims and Litigation.
        Promptly
        inform Lender in writing of (1) all material adverse changes in Borrower's
        financial condition, and (2) all existing and all threatened litigation,
        claims,
        investigations, administrative proceedings or similar actions affecting Borrower
        or any Guarantor which could materially affect the financial condition of
        Borrower or the financial condition of any Guarantor.

       

      Financial
        Records.
        Maintain
        its books and records in accordance with GAAP, applied on a consistent basis,
        and permit Lender to examine and audit Borrower's books and records at all
        reasonable times.

       

      Financial
        Statements.
        Furnish
        Lender with the following:

       

      Additional
        Requirements. 

       

      BORROWER'S
        FINANCIAL REQUIREMENTS:

       

      (i)
        Financial Statements:

       

      ANNUAL
        STATEMENTS.
        Borrower
        shall provide to Lender, as soon as available, but in no event later than
        one
        hundred five (105) days after the end of each fiscal year end, a 10K report
        and
        consolidated balance sheet and income statement for the period ended in form
        satisfactory to Lender, audited, unqualified opinion, by a CPA acceptable
        to
        Lender.

       

      INTERIM
        STATEMENTS.
        Borrower
        shall provide to Lender, as soon as available, but in no event later than
        sixty
        (60) days after the end of each fiscal quarter (including fiscal year end),
        a
        10Q and supporting schedules for the period ended, each in form satisfactory
        to
        Lender. Statements may be due more often if requested by Lender.

      
         

        
          
            
              Rubio’s
                Restaurants, Inc.-Line #400461335

              Business
                Loan Agreement (04-2008)

            

          

          
            2

            
              

            

          

          
            
            

          

        

      

      LEASE
        MANAGEMENT REPORTS.
        Borrower
        shall provide to Lender, as soon as available, but in no event later than
        sixty
        (60) days after the end of each fiscal quarter (including fiscal year end),
        a
        lease management report and same store sales analysis for the period ended,
        each
        in form satisfactory to Lender. Statements may be due more often if requested
        by
        Lender.

       

      ANNUAL
        BUDGET.
        Borrower
        shall provide to Lender, as soon as available, but in no event later than
        one
        hundred five (105) days after the end of each fiscal year end, an annual
        budget
        and balance sheet for the period ended in form satisfactory to
        Lender.

       

      (ii)
        Financial Covenants/Ratios: (the first reporting period will be Borrower’s
        second fiscal quarter ending June 29, 2008)

       

      TOTAL
        DEBT/EBITDA RATIO.
        Borrower
        to maintain a maximum ratio of Total Debt/EBITDA of *** to ***. "Total Debt"
        means Borrower's outstanding senior debt plus Standby Letters of Credit issued
        by Lender. "EBITDA" means net earnings before interest expense, taxes,
        depreciation, amortization, and other adjustments reasonably acceptable to
        Lender in its sole discretion ( *** ), calculated on a rolling *** fiscal
        quarter basis. This ratio must be maintained at all times and may be evaluated
        quarterly.

       

      PROFITABILITY.
        Borrower
        must *** for its ***
        ending
        *** (one time covenant) and to be *** at the *** and *** reporting periods
        (starting with the *** reporting). Borrower will *** in *** consecutive fiscal
        quarters (first compliance review commencing with the **** reporting). For
        purposes of determining whether Borrower satisfies the profitability tests
        set
        forth in this paragraph, Lender agrees that Borrower may exclude ***
        .

       

      COMMERCIAL
        LOAN DEBT SERVICE COVERAGE RATIO.
        Borrower
        to maintain a minimum Debt Service Coverage Ratio of *** to *** , which is
        calculated based on a rolling *** fiscal quarter basis, as 1) the sum of
        net
        profit plus depreciation and amortization and interest and other adjustments
        reasonably acceptable to Lender in its sole discretion ( *** ), less the
        sum of
        dividends and distributions divided by 2) Current Portion of Long Term Debt
        plus
        Interest. This ratio must be maintained at all times and may be evaluated
        quarterly. For purposes of determining whether Borrower net profit for the
        financial tests set forth in this paragraph, Lender agrees that Borrower
        may
        exclude *** .

       

      All
        financial reports required to be provided under this Agreement shall be prepared
        in accordance with GAAP, applied on a consistent basis, and certified by
        Borrower as being true and correct.

       

      Additional
        Information.
        Furnish
        such additional information and statements, as Lender may request from time
        to
        time.

       

      Insurance.
        Maintain
        fire and other risk insurance, public liability insurance, and such other
        insurance as Lender may require with respect to Borrower's properties and
        operations, in form, amounts, coverages and with insurance companies acceptable
        to Lender in its commercially reasonable discretion. Borrower, upon request
        of
        Lender, will deliver to Lender from time to time the policies or certificates
        of
        insurance in form reasonably satisfactory to Lender, including stipulations
        that
        coverages will not be cancelled or diminished without at least thirty (30)
        days
        prior written notice to Lender. Each insurance policy also shall include
        an
        endorsement providing that coverage in favor of Lender will not be impaired
        in
        any way by any act, omission or default of Borrower or any other person.
        In
        connection with all policies covering assets in which Lender holds or is
        offered
        a security interest for the Loans, Borrower will provide Lender with such
        lender's loss payable or other endorsements as Lender may require in its
        commercially reasonable discretion.

       

      Insurance
        Reports.
        Furnish
        to Lender, upon request of Lender, reports on each existing insurance policy
        showing such information as Lender may reasonably request, including without
        limitation the following: (1) the name of the insurer; (2) the risks insured;
        (3) the amount of the policy; (4) the properties insured; (5) the then current
        property values on the basis of which insurance has been obtained, and the
        manner of determining those values; and (6) the expiration date of the policy.
        In addition, upon request of Lender (however not more often than annually),
        Borrower will have an independent appraiser satisfactory to Lender determine,
        as
        applicable, the actual cash value or replacement cost of any Collateral.
        The
        cost of such appraisal shall be paid by Borrower. Lender acknowledges and
        agrees
        that Borrower does not currently insure the full cash value or replacement
        cost
        of the Collateral.

       

      Guaranties.
        Prior to
        disbursement of any Loan proceeds, furnish executed guaranties of the Loans
        in
        favor of Lender, executed by the guarantors named below, on Lender's forms,
        and
        in the amounts and under the conditions set forth in those
        guaranties.

      


      
        	
                Names
                  of Guarantors

              	
                Amounts

              
	 	 
	
                Rubio's
                  Restaurants of Nevada, Inc., a Nevada corporation

              	
                Unlimited

              
	 	 
	
                Rubio's
                  Promotions, Inc., an Arizona corporation

              	
                Unlimited

              


      

       

      Other
        Agreements.
        Comply
        with all terms and conditions of all other agreements, whether now or hereafter
        existing, between Borrower and any other party and notify Lender immediately
        in
        writing of any default in connection with any other such agreements that
        would
        have a material adverse affect on Borrower’s financial condition.

       

      Loan
        Proceeds.
        Use all
        Loan proceeds solely for Borrower's business operations and Permitted
        Acquisitions, unless specifically consented to the contrary by Lender in
        writing.

       

      Taxes,
        Charges and Liens.
        Pay and
        discharge when due all of its indebtedness and obligations, including without
        limitation all assessments, taxes, governmental charges, levies and liens,
        of
        every kind and nature, imposed upon Borrower or its properties, income, or
        profits, prior to the date on which penalties would attach, and all lawful
        claims that, if unpaid, might become a lien or charge upon any of Borrower's
        properties, income, or profits. Provided however, Borrower will not be required
        to pay and discharge any such assessment, tax, charge, levy, lien or claim
        so
        long as (1) the legality of the same shall be contested in good faith by
        appropriate proceedings, and (2) Borrower shall have established on Borrower's
        books adequate reserves with respect to such contested assessment, tax, charge,
        levy, lien, or claim in accordance with GAAP.

       

      Performance.
        Perform
        and comply, in a timely manner, with all terms, conditions, and provisions
        set
        forth in this Agreement, in the Related Documents, and in all other instruments
        and agreements between Borrower and Lender. Borrower shall notify Lender
        immediately in writing of any default in connection with any agreement with
        Lender

       

      
        ***
          Portions
          of this page have been omitted pursuant to a request for Confidential Treatment
          and filed separately with the Commission.

        
           

          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              3

              
                

              

            

            
              
              

            

          

        

      

      Operations.
        Maintain
        executive and management personnel with substantially the same qualifications
        and experience as the present executive and management personnel; provide
        written notice to Lender of any change in executive and management personnel;
        conduct its business affairs in a reasonable and prudent manner.

       

      Environmental
        Studies.
        Promptly
        conduct and complete, at Borrower's expense, all such investigations, studies,
        samplings and testings as may be requested by Lender or any governmental
        authority relative to any substance, or any waste or by-product of any substance
        defined as toxic or a hazardous substance under applicable federal, state,
        or
        local law, rule, regulation, order or directive, at or affecting any property
        or
        any facility owned, leased or used by Borrower.

       

      Compliance
        with Governmental Requirements.
        Comply
        with all laws, ordinances, and regulations, now or hereafter in effect, of
        all
        governmental authorities including but not limited to Anti-Terrorism laws,
        and
        other laws applicable to the conduct of Borrower's properties, businesses
        and
        operations, and to the use or occupancy of the Collateral, including without
        limitation, the Americans With Disabilities Act, except any failure which
        would
        not have a material adverse affect on its financial condition. Borrower may
        contest in good faith any such law, ordinance, or regulation and withhold
        compliance during any proceeding, including appropriate appeals, so long
        as
        Borrower has notified Lender in writing prior to doing so and so long as,
        in
        Lender's sole opinion, Lender's interests in the Collateral are not jeopardized.
        Lender may require Borrower to post adequate security or a surety bond,
        reasonably satisfactory to Lender, to protect Lender's interest.

       

      Inspection.
        Permit
        employees or agents of Lender at any reasonable time to inspect any and all
        Collateral for the Loan or Loans and Borrower's other properties and to examine
        or audit Borrower's books, accounts, and records and to make copies and
        memoranda of Borrower's books, accounts, and records. If Borrower now or
        at any
        time hereafter maintains any records (including without limitation computer
        generated records and computer software programs for the generation of such
        records) in the possession of a third party, Borrower, upon request of Lender,
        shall notify such party to permit Lender free access to such records at all
        reasonable times and to provide Lender with copies of any records it may
        request, all at Borrower's expense. 

       

      Compliance
        Certificates.
        Unless
        waived in writing by Lender, provide Lender, within sixty (60) days after
        the
        end of each fiscal quarter and at the time of each disbursement of Loan
        proceeds, a certificate executed by Borrower's chief financial officer, or
        other
        officer or person acceptable to Lender, certifying that the representations
        and
        warranties set forth in this Agreement are true and correct as of the date
        of
        the certificate and further certifying that, as of the date of the certificate,
        no Event of Default exists under this Agreement.

       

      Environmental
        Compliance and Reports.
        Borrower
        shall comply in all respects with any and all Environmental Laws; not cause
        or
        permit to exist, as a result of an intentional or unintentional action or
        omission on Borrower's part or on the part of any third party, on property
        owned
        and/or occupied by Borrower, any environmental activity where damage may
        result
        to the environment, unless such environmental activity is pursuant to and
        in
        compliance with the conditions of a permit issued by the appropriate federal,
        state or local governmental authorities; shall furnish to Lender promptly
        and in
        any event within thirty (30) days after receipt thereof a copy of any notice,
        summons, lien, citation, directive, letter or other communication from any
        governmental agency or instrumentality concerning any intentional or
        unintentional action or omission on Borrower's part in connection with any
        environmental activity whether or not there is damage to the environment
        and/or
        other natural resources.

       

      Additional
        Assurances.
        Make,
        execute and deliver to Lender such notes, mortgages, deeds of trust, security
        agreements, assignments, financing statements, instruments, documents and
        other
        agreements as Lender or its attorneys may reasonably request to evidence
        and
        secure the Loans and to perfect all Security Interests.

       

      RECOVERY
        OF ADDITIONAL COSTS.
        If the
        imposition of or any change in any law, rule, regulation or guideline, or
        the
        interpretation or application of any thereof by any court or administrative
        or
        governmental authority (including any request or policy not having the force
        of
        law) shall impose, modify or make applicable any taxes (except federal, state
        or
        local income or franchise taxes imposed on Lender), reserve requirements,
        capital adequacy requirements or other obligations which would (A) increase
        the
        cost to Lender for extending or maintaining the credit facilities to which
        this
        Agreement relates, (B) reduce the amounts payable to Lender under this Agreement
        or the Related Documents, or (C) reduce the rate of return on Lender's capital
        as a consequence of Lender's obligations with respect to the credit facilities
        to which this Agreement relates, then Borrower agrees to pay Lender such
        additional amounts as will compensate Lender therefor, within five (5) days
        after Lender's written demand for such payment, which demand shall (x) be
        provided to Borrower within ninety (90) days of such imposition or change
        and
        (y) be accompanied by an explanation of such imposition or charge and a
        calculation in reasonable detail of the additional amounts payable by Borrower,
        which explanation and calculations shall be conclusive in the absence of
        manifest error.

       

      LENDER'S
        EXPENDITURES.
        If any
        action or proceeding is commenced that would materially affect Lender's interest
        in the Collateral (and in which Borrower is not taking reasonably prudent
        actions to protect Lender’s interest in the Collateral) or if Borrower fails to
        comply with any provision of this Agreement or any Related Documents, including
        but not limited to Borrower's failure to discharge or pay when due any amounts
        Borrower is required to discharge or pay under this Agreement or any Related
        Documents, Lender on Borrower's behalf may (but shall not be obligated to)
        take
        any action that Lender deems appropriate, including but not limited to
        discharging or paying all taxes, liens, security interests, encumbrances
        and
        other claims, at any time levied or placed on any Collateral and paying all
        costs for insuring, maintaining and preserving any Collateral. All such
        expenditures reasonably incurred or paid by Lender for such purposes will
        then
        bear interest at the rate charged under the Note from the date incurred or
        paid
        by Lender to the date of repayment by Borrower. All such expenses will become
        a
        part of the Indebtedness and, at Lender's option, will (A) be payable on
        demand;
        (B) be added to the balance of the Note and be apportioned among and be payable
        with any installment payments to become due during either (1) the term of
        any
        applicable insurance policy; or (2) the remaining term of the Note; or (C)
        be
        treated as a balloon payment which will be due and payable on the Maturity
        Date.

       

      NEGATIVE
        COVENANTS.
        Borrower
        covenants and agrees with Lender that while this Agreement is in effect,
        Borrower shall not, without the prior written consent of Lender:

       

      Indebtedness
        and Liens.
        (1)
        Create, incur or assume indebtedness for borrowed money, including capital
        leases, except for (a) trade debt incurred in the normal course of business,
        (b)
        equipment debt not to exceed ***
        in the
        aggregate (i) upon or in any equipment acquired or held by the Borrower to
        secure the purchase price of such equipment or indebtedness incurred solely
        for
        the purpose of financing the acquisition or lease of such equipment, or (ii)
        existing on such equipment at the time of its acquisition, (c) liabilities,
        lines of credit, and leases in existence on the date of this Agreement and
        disclosed to Lender on Schedule
        4
        to the
        Disclosure Schedule and leases entered into after the date of this Agreement
        in
        the normal course of business, (d) endorsing negotiable instruments received
        in
        the usual course of business and (e) and indebtedness to Lender contemplated
        by
        this Agreement or the Credit Agreement; and (2) sell, transfer, mortgage,
        assign, pledge, lease, grant a security interest in, or encumber any of
        Borrower's assets (except as allowed as Permitted Liens), or (3) sell with
        recourse any of Borrower's accounts, except to Lender.

      
         

        ***
          Portions
          of this page have been omitted pursuant to a request for Confidential Treatment
          and filed separately with the Commission.

        
           

          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              4

              
                

              

            

            
              
              

            

          

        

      

      Continuity
        of Operations.
        (1)
        Engage in any business activities substantially different than those in which
        Borrower is presently engaged, (2) cease operations, liquidate, merge, transfer,
        acquire or consolidate with any other entity, change its name, dissolve or
        transfer or sell Collateral out of the ordinary course of business, or (3)
        pay
        any dividends on Borrower's stock (other than dividends payable in its stock),
        provided, however that notwithstanding the foregoing, but only so long as
        no
        Event of Default has occurred and is continuing or would result from the
        payment
        of dividends, if Borrower is a "Subchapter S Corporation" (as defined in
        the
        Internal Revenue Code of 1986, as amended), Borrower may pay cash dividends
        on
        its stock to its shareholders from time to time in amounts necessary to enable
        the shareholders to pay income taxes and make estimated income tax payments
        to
        satisfy their liabilities under federal and state law which arise solely
        from
        their status as Shareholders of a Subchapter S Corporation because of their
        ownership of shares of Borrower's stock, or purchase or retire any of Borrower's
        outstanding shares or alter or amend Borrower's capital structure; provided,
        further, that Borrower may use up to $*** of the Loan to fund Permitted
        Acquisitions, Borrower may terminate up to ***
        percent
        (***%) of all leases through the Maturity Date and Borrower may elect not
        to
        renew leases in connection with locations that have generated less than $***
        of
        trailing twelve month EBITDA.

       

      Loans,
        Acquisitions and Guaranties.
        Borrower
        shall not: (1)  except with respect to the Subsidiaries, loan, invest in or
        advance money or assets to any other person, enterprise or entity,
 (2)  except with respect to the Subsidiaries, purchase, create or
        acquire any interest in any other enterprise or entity, or (3) incur any
        obligation as surety or guarantor other than in the ordinary course of business;
        provided,
        however,
        Borrower may use up to $*** of the Loan to fund Permitted
        Acquisitions.

       

      Agreements.
        Borrower
        will not enter into any agreement containing any provisions which would be
        violated or breached by the performance of Borrower's obligations under this
        Agreement or in connection herewith.

       

      CESSATION
        OF ADVANCES.
        If
        Lender has made any commitment to make any Loan to Borrower, whether under
        this
        Agreement or under any other agreement, Lender shall have no obligation to
        make
        Loan Advances or to disburse Loan proceeds if: (A) Borrower or any Guarantor
        is
        in default under this Agreement or any of the Related Documents or any other
        agreement that Borrower or any Guarantor has with Lender; (B) Borrower or
        any
        Guarantor dies, becomes incompetent or becomes insolvent, files a petition
        in
        bankruptcy or similar proceedings, or is adjudged a bankrupt; (C) there occurs
        a
        materially adverse change in Borrower's financial condition, in the financial
        condition of any Guarantor, or in the value of any Collateral securing any
        Loan;
        or (D) any Guarantor seeks, claims or otherwise attempts to limit, modify
        or
        revoke such Guarantor's guaranty of the Loan or any other loan with
        Lender.

       

      RIGHT
        OF SETOFF.
        To the
        extent permitted by applicable law, Lender reserves a right of setoff in
        all
        Borrower's accounts with Lender (whether checking, savings, or some other
        account). This includes all accounts Borrower holds jointly with someone
        else
        and all accounts Borrower may open in the future. However, this does not
        include
        any IRA or Keogh accounts, or any trust accounts for which setoff would be
        prohibited by law. Borrower authorizes Lender, to the extent permitted by
        applicable law, to charge or setoff all sums owing on the Indebtedness against
        any and all such accounts.

       

      DEFAULT.
        Each of
        the following shall constitute an Event of Default under this
        Agreement:

       

      Payment
        Default.
        Borrower
        fails to make any payment when due under the Loan (including the
        Note).

       

      Other
        Defaults.
        Borrower
        fails to comply with or to perform any other term, obligation, covenant or
        condition contained in this Agreement or in any of the Related Documents
        or to
        comply with or to perform any term, obligation, covenant or condition contained
        in any other agreement between Lender and Borrower.

       

      Default
        in Favor of Third Parties.
        Borrower
        or any Grantor defaults under any loan, extension of credit, security agreement,
        purchase or sales agreement, or any other agreement, in favor of any other
        creditor or person that would materially affect any of Borrower's or any
        Grantor's financial condition or Borrower's or any Grantor's ability to repay
        the Loans or perform their respective obligations under this Agreement or
        any of
        the Related Documents.

       

      False
        Statements.
        Any
        warranty, representation or statement made or furnished to Lender by Borrower
        or
        on Borrower's behalf under this Agreement or the Related Documents is false
        or
        misleading in any material respect, either now or at the time made or furnished
        or becomes false or misleading at any time thereafter.

       

      Insolvency.
        The
        dissolution or termination of Borrower's existence as a going business, the
        insolvency of Borrower, the appointment of a receiver for any part of Borrower's
        property, any assignment for the benefit of creditors, any type of creditor
        workout, or the commencement of any proceeding under any bankruptcy or
        insolvency laws by or against Borrower.

       

      Defective
        Collateralization.
        This
        Agreement or any of the Related Documents ceases to be in full force and
        effect
        (including failure of any collateral document to create a valid and perfected
        security interest or lien) at any time and for any reason other than as a
        result
        of Lender’s actions or inactions.

       

      Creditor
        or Forfeiture Proceedings.
        Commencement of foreclosure or forfeiture proceedings, whether by judicial
        proceeding, self-help, repossession or any other method, by any creditor
        of
        Borrower or by any governmental agency against any collateral securing the
        Loan.
        This includes a garnishment of any of Borrower's accounts, including deposit
        accounts, with Lender. However, this Event of Default shall not apply if
        there
        is a good faith dispute by Borrower as to the validity or reasonableness
        of the
        claim which is the basis of the creditor or forfeiture proceeding and if
        Borrower gives Lender written notice of the creditor or forfeiture proceeding
        and deposits with Lender monies or a surety bond for the creditor or forfeiture
        proceeding, in an amount determined by Lender, in its sole discretion, as
        being
        an adequate reserve or bond for the dispute; provided, however, Borrower
        may
        terminate up to *** percent (***%) of all leases through the Maturity Date
        and
        Borrower may elect not to renew leases in connection with locations that
        have
        generated less than $*** of trailing twelve month EBITDA.

       

      Events
        Affecting Guarantor.
        Any of
        the preceding events occurs with respect to any Guarantor of any of the
        Indebtedness or any Guarantor dies or becomes incompetent, or revokes or
        disputes the validity of, or liability under, any Guaranty of the
        Indebtedness.

       

      
        ***
          Portions
          of this page have been omitted pursuant to a request for Confidential Treatment
          and filed separately with the Commission.

        
           

          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              5

              
                

              

            

            
              
              

            

          

        

      

      Change
        in Ownership.
        Any
        change in ownership an event or series of events by which (a) any “person” or
“group” (as such terms are used in Sections 13(d) and 14(d) of the Securities
        Exchange Act of 1934) shall become, or obtains rights (whether by means of
        warrants, options or otherwise) to become, the “beneficial owner” (as defined in
        Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934), directly
        or
        indirectly, of twenty five percent (25%) or more of the equity securities
        of the
        Borrower entitled to vote for members of the board of directors or equivalent
        governing body of the Borrower on a fully-diluted basis, (b) any “person” or
“group” acquires direct or indirect Control of the Borrower, or (c) the majority
        of the members of the board of directors or other equivalent governing body
        of
        the Borrower cease to be composed of Continuing Directors. “Continuing
        Directors” means the directors of the Borrower on the Loan Date, and each other
        director of the Borrower, if such other director’s nomination for election to
        the board of directors of the Borrower is recommended by a majority of the
        then
        Continuing Directors of the Borrower, whether or not directors on the Loan
        Date,
        in his or her election by the shareholders of the Borrower. For purposes
        of this
        Section, “Control” means (a) the power to control a majority of the Borrower’s
        Board of Directors, whether by virtue of ownership of a specified number
        of
        shares, or by contract, or (b) any contract with any person that gives such
        person control over a substantial portion of the policies or other decision
        making of the Borrower.

       

      Adverse
        Change.
        Lender
        determines, on the basis of its commercially reasonable discretion, that
        a
        material adverse change has occurred or is occurring in Borrower's financial
        condition.

       

      Right
        to Cure.
        If any
        default, other than a default on Indebtedness, is curable and if Borrower
        or
        Grantor, as the case may be, has not been given a notice of a similar default
        within the preceding twelve (12) months, it may be cured if Borrower or Grantor,
        as the case may be, after receiving written notice from Lender demanding
        cure of
        such default: (1) cure the default within fifteen (15) days; or (2) if the
        cure
        requires more than fifteen (15) days, immediately initiate steps which Lender
        deems in Lender's sole discretion to be sufficient to cure the default and
        thereafter continue and complete all reasonable and necessary steps sufficient
        to produce compliance as soon as reasonably practical.

       

      EFFECT
        OF AN EVENT OF DEFAULT.
        If any
        Event of Default shall occur, except where otherwise provided in this Agreement
        or the Related Documents, all commitments and obligations of Lender under
        this
        Agreement or the Related Documents or any other agreement immediately will
        terminate (including any obligation to make further Loan Advances or
        disbursements), and, at Lender's option, all Indebtedness immediately will
        become due and payable, all without notice of any kind to Borrower, except
        that
        in the case of an Event of Default of the type described in the "Insolvency"
        subsection above, such acceleration shall be automatic and not optional.
        In
        addition, Lender shall have all the rights and remedies provided in the Related
        Documents or available at law, in equity, or otherwise. Except as may be
        prohibited by applicable law, all of Lender's rights and remedies shall be
        cumulative and may be exercised singularly or concurrently. Election by Lender
        to pursue any remedy shall not exclude pursuit of any other remedy, and an
        election to make expenditures or to take action to perform an obligation
        of
        Borrower or of any Grantor shall not affect Lender's right to declare a default
        and to exercise its rights and remedies.

       

      PRIMARY
        DEPOSITORY RELATIONSHIP.
        Borrower
        agrees to maintain its primary depository relationship with Lender subject
        to
        Lender's applicable fees and charges.

       

      OUTSIDE
        INDEBTEDNESS.
        New
        outside indebtedness (in addition to Permitted Liens) is allowed to a maximum
        amount of $*** in the aggregate, annually.

       

      ADDITIONAL
        EVENTS OF DEFAULT. 

       

      1.
        An
        event of default will exist if Borrower's ***.

       

      2.
        An
        event of default will exist if Borrower's ***.

       

      To
        cure a
        potential default on the above referenced items, Lender will permit Borrower
        to
        *** ; Borrower has a five (5) business day period to cure either
        default.

       

      CONDITIONS
        TO CLOSING. Lender
        shall not be required to fund any Loans, arrange for issuance of any letters
        of
        credit or grant any other accommodation to or for the benefit of Borrower,
        unless the following conditions are satisfied:

       

      (a) All
        Loan
        Documents shall have been duly executed and delivered to Lender by each
        signatory thereto, and each Obligor shall be in compliance with all terms
        thereof.

       

      (b) Lender
        shall have received acknowledgments of all filings or recordations necessary
        to
        perfect its liens in the Collateral, as well as UCC and lien searches and
        other
        evidence satisfactory to Lender that such liens are the only liens upon the
        Collateral, except Permitted Liens and except as provided below in the Section
        titled “Post Closing Conditions”.

       

      (c) Lender
        shall have received copies of policies or certificates of insurance for the
        insurance policies carried by Borrower, all in compliance with this
        Agreement.

       

      (d) No
        Event
        of Default shall exist at the time of, or result from, such funding, issuance
        or
        grant.

       

      (e) Lender
        shall have received the written opinion of DLA Piper in form and substance
        reasonably satisfactory to Lender.

       

      (f) No
        event
        shall have occurred or circumstance exist that has or would reasonably be
        expected to have a material adverse effect on Borrower’s financial
        condition.

       

      (g) The
        representations and warranties of each Obligor in the Loan Documents shall
        be
        true and correct on the date of, and upon giving effect to, such funding,
        issuance or grant (except for representations and warranties that expressly
        relate to an earlier date).

       

      (h) Lender
        shall have received a certificate of a duly authorized officer of each Obligor,
        certifying (i) that attached copies of such Obligor’s organizational
        documents are true and complete, and in full force and effect, without amendment
        except as shown; (ii) that an attached copy of resolutions authorizing
        execution and delivery of the Loan Documents is true and complete, and that
        such
        resolutions are in full force and effect, were duly adopted, have not been
        amended, modified or revoked, and constitute all resolutions adopted with
        respect to this credit facility; and (iii) to the title, name and signature
        of each Person authorized to sign the Loan Documents. Agent may conclusively
        rely on this certificate until it is otherwise notified by the applicable
        Obligor in writing.

       

      
        ***
          Portions
          of this page have been omitted pursuant to a request for Confidential Treatment
          and filed separately with the Commission.

        
           

          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              6

              
                

              

            

            
              
              

            

          

        

      

      (i) Lender
        shall have received good standing certificates for each Obligor, issued by
        the
        Secretary of State or other appropriate official of such Obligor’s jurisdiction
        of organization and each jurisdiction where such Obligor’s conduct of business
        necessitates qualification.

       

      POST
        CLOSING CONDITIONS. The
        Borrower shall deliver or cause to be delivered to the Lender the following
        documents, in form and substance satisfactory to Lender, within the prescribed
        time period set forth below (failure to timely comply with such covenants
        shall
        result in an immediate Event of Default under this Agreement):

       

      (a) Within
        10
        days of the Loan Date, an acknowledgment/consent executed by Bank of America
        and
        any beneficiary to a letter of credit issued by Bank of America, in form
        and
        substance satisfactory to Lender, acknowledging Bank of America’s release of any
        security interest and existing liens (other than Permitted Liens) relating
        to
        any issued letter of credit, and consenting to the replacement of any such
        issued letter of credit by a new Letter of Credit issued by Lender.

       

      (b) Within
        45
        days of the Loan Date, either (1) evidence satisfactory to the Lender that
        the Borrower has closed those certain deposit accounts (other than payroll
        accounts) set forth on Schedule 5
        to the
        Disclosure Schedule, and transferred all funds therein to another deposit
        account(s) held by Lender, or (2) control agreements substantially
        establishing the Lender’s “control” (within the meaning of Section 8-106, 9-106
        or 9-104 of the UCC, as applicable) with respect to such deposit accounts
        set
        forth on Schedule 5
        to the
        Disclosure Schedule.

       

      LETTERS
        OF CREDIT. 

       

      Subject
        to the terms of this Agreement, Lender will issue one or more Standby Letters
        of
        Credit (each a "Letter of Credit") on behalf of Borrower for terms of up
        to two
        year(s). At no time, however, shall (i) the total face amount of the Letters
        of
        Credit outstanding exceed the sum of $4,000,000.00; and (ii) the total amount
        outstanding under this Agreement, inclusive of any Letter’s of Credit, exceed
        the sum of $5,000,000.00.

       

      (a)
        Upon
        Lenders request, Borrower promptly shall pay to Lender issuance fees and
        such
        other fees, commissions, costs and any out of pocket expenses charged or
        incurred by Lender with respect to any Letter of Credit including but not
        limited to an annual fee equal to ***%
        per
        annum prior to issuance of any Letter of Credit.

       

      (b)
        The
        commitment by Lender to issue Letters of Credit shall, unless earlier terminated
        in accordance with the terms of this Agreement, automatically terminate
        concurrently with the Maturity Date of the Note.

       

      (c)
        Each
        Letter of Credit shall be in form and substance satisfactory to Lender and
        in
        favor of beneficiaries satisfactory to Lender, provided that Lender may refuse
        to issue a Letter of Credit due to the nature of the transaction or its terms
        or
        in connection with any transaction where Lender, due to the beneficiary or
        the
        nationality or residence of the beneficiary, would be prohibited by any
        applicable law, regulation, or order from issuing such Letter of
        Credit.

       

      (d)
        Prior
        to the issuance of each Letter of Credit, and in all events prior to any
        daily
        cutoff time Lender may have established for purposes thereof, Borrower shall
        deliver to Lender, a duly executed form of Lender's standard form of application
        for issuance of Letters of Credit with proper insertions.

       

      (e)
        If
        drawn, whether in full or in part, the principal amount of each draw (including
        accrued interest and fees) must be repaid upon Lender’s demand.

       

      MISCELLANEOUS
        PROVISIONS.
        The
        following miscellaneous provisions are a part of this Agreement:

       

      Amendments.
        This
        Agreement, together with any Related Documents, constitutes the entire
        understanding and agreement of the parties as to the matters set forth in
        this
        Agreement. No alteration of or amendment to this Agreement shall be effective
        unless given in writing and signed by the party or parties sought to be charged
        or bound by the alteration or amendment.

       

      Attorneys'
        Fees; Expenses.
        Borrower
        agrees to pay upon demand all of Lender's costs and expenses, including Lender's
        reasonable attorneys' fees and Lender's reasonable legal expenses, incurred
        in
        connection with the enforcement of this Agreement. Lender may hire or pay
        someone else to help enforce this Agreement, and Borrower shall pay the
        reasonable costs and expenses of such enforcement. Costs and expenses include
        Lender's reasonable attorneys' fees and legal expenses whether or not there
        is a
        lawsuit, including attorneys' fees and legal expenses for bankruptcy proceedings
        (including efforts to modify or vacate any automatic stay or injunction),
        appeals, and any anticipated post-judgment collection services. Borrower
        also
        shall pay all court costs and such additional fees as may be directed by
        the
        court.

       

      Caption
        Headings.
        Caption
        headings in this Agreement are for convenience purposes only and are not
        to be
        used to interpret or define the provisions of this Agreement.

       

      Consent
        to Loan Participation.
        Borrower
        agrees and consents to Lender's sale or transfer, whether now or later, of
        one
        or more participation interests in the Loan to one or more purchasers, whether
        related or unrelated to Lender. Lender may provide, without any limitation
        whatsoever, to any one or more purchasers, or potential purchasers, any
        information or knowledge Lender may have about Borrower or about any other
        matter relating to the Loan, and Borrower hereby waives any rights to privacy
        Borrower may have with respect to such matters. Borrower additionally waives
        any
        and all notices of sale of participation interests, as well as all notices
        of
        any repurchase of such participation interests. Borrower also agrees that
        the
        purchasers of any such participation interests will be considered as the
        absolute owners of such interests in the Loan and will have all the rights
        granted under the participation agreement or agreements governing the sale
        of
        such participation interests. Borrower further waives all rights of offset
        or
        counterclaim that it may have now or later against Lender or against any
        purchaser of such a participation interest and unconditionally agrees that
        either Lender or such purchaser may enforce Borrower's obligation under the
        Loan
        irrespective of the failure or insolvency of any holder of any interest in
        the
        Loan. Borrower further agrees that the purchaser of any such participation
        interests may enforce its interests irrespective of any personal claims or
        defenses that Borrower may have against Lender.

       

      
        ***
          Portions
          of this page have been omitted pursuant to a request for Confidential Treatment
          and filed separately with the Commission.

        
           

          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              7

              
                

              

            

            
              
              

            

          

        

      

      Confidentiality.
        Lender
        agrees to maintain the confidentiality of all Information (as defined below),
        except that Information may be disclosed (a) to its Affiliates and to its
        and
        its Affiliates’ respective partners, directors, officers, employees, agents,
        advisors and representatives (it being understood that the Persons to whom
        such
        disclosure is made will be informed of the confidential nature of such
        Information and instructed to keep such Information confidential); (b) to
        the
        extent requested by any regulatory authority purporting to have jurisdiction
        over it (including any self-regulatory authority, including but not limited
        to
        the Federal Deposit Insurance Corporation or the California Department of
        Financial Institutions); (c) to the extent required by Applicable Law or
        by any
        subpoena or similar legal process; (d) to any other party hereto; (e) in
        connection with the exercise of any remedies, the enforcement of any rights,
        or
        any action or proceeding relating to any Loan Documents; (f) subject to an
        agreement containing provisions substantially the same as those of this Section,
        to any transferee or any actual or prospective party (or its advisors) to
        any
        Bank Product; (g) with the consent of the Borrower; or (h) to the extent
        such
        Information (i) becomes publicly available other than as a result of a breach
        of
        this Section or (ii) becomes available to Lender or any of its Affiliates
        on a
        nonconfidential basis from a source other than Borrower. Notwithstanding
        the
        foregoing, Lender may issue and disseminate to the public general information
        describing this credit facility, including the name and address of Borrower
        and
        a general description of Borrower’s business, and may use Borrower’s name in
        advertising and other promotional materials. For purposes of this Section,
        “Information” means all information received from an Obligor or Subsidiary
        relating to it or its business, other than any information that is available
        to
        Lender on a nonconfidential basis prior to disclosure by the Obligor or
        Subsidiary, provided,
        however,
        that,
        in the case of information received from an Obligor or Subsidiary after the
        date
        hereof, such information is clearly identified at the time of delivery as
        confidential. Any Person required to maintain the confidentiality of Information
        pursuant to this Section shall be considered to have complied with its
        obligation to do so if such Person has exercised the same degree of care
        to
        maintain the confidentiality of such Information as such Person would accord
        to
        its own confidential information, but in no event less than commercially
        reasonable care. Lender acknowledges that (i) Information may include material
        non-public information concerning an Obligor or Subsidiary; (ii) it has
        developed compliance procedures regarding the use of material non-public
        information; and (iii) it will handle such material non-public information
        in
        accordance with Applicable Law, including federal and state securities
        laws.
        For
        purposes of this Section, “Affiliate” means with respect to any Person, another
        Person that directly, or indirectly through one or more intermediaries, Controls
        or is Controlled by or is under common Control with the Person specified.
        For
        purposes of this Section, “Control” means the possession, directly or
        indirectly, of the power to direct or cause the direction of the management
        or
        policies of a Person, whether through the ability to exercise voting power,
        by
        contract or otherwise (“Controlling” and “Controlled” have correlative
        meanings). 

       

      Governing
        Law. This
        Agreement will be governed by federal law applicable to Lender and, to the
        extent not preempted by federal law, the laws of the State of California
        without
        regard to its conflicts of law provisions. This Agreement has been accepted
        by
        Lender in the State of California.

       

      Choice
        of Venue.
        If there
        is a lawsuit, Borrower agrees upon Lender's request to submit to the
        jurisdiction of the courts of Los Angeles County, State of
        California.

       

      Waiver
        of Jury Trial. TO
        THE
        FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER AND LENDER HEREBY
        IRREVOCABLY AND EXPRESSLY WAIVE ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
        PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE)
        ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER RELATED DOCUMENT,
        THE
        OBLIGATIONS OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR
        EITHER
        PARTY’S ACTIONS IN THE NEGOTIATION, ADMINISTRATION, OR ENFORCEMENT HEREOF OR
        THEREOF. BORROWER AND LENDER EACH ACKNOWLEDGES THAT SUCH WAIVER IS MADE WITH
        FULL KNOWLEDGE AND UNDERSTANDING OF THE NATURE OF THE RIGHTS AND BENEFITS
        WAIVED
        HEREBY, AND WITH THE BENEFIT OF ADVICE OF COUNSEL OF ITS CHOOSING.

       

      Judicial
        Reference. The
        parties prefer that any dispute between them be resolved in litigation subject
        to a Jury Trial Waiver as set forth in this Agreement, but the California
        Supreme Court has held that such pre-dispute jury trial waivers are
        unenforceable. This section will be applicable until: (i) the California
        Supreme Court holds that a pre-dispute jury trial waiver provision similar
        to
        that contained in this Agreement is valid or enforceable; or (ii) the
        California Legislature passes legislation and the governor of the State of
        California signs into law a statute authorizing pre-dispute jury trial waivers
        and as a result such waivers become enforceable.

       

      Other
        than the exercise of provisional remedies (any of which may be initiated
        pursuant to applicable law), any controversy, dispute or claim (each, a “Claim”)
        between the parties arising out of or relating to this Agreement will be
        resolved by a reference proceeding in California in accordance with the
        provisions of Section 638 et seq. of the California Code of Civil Procedure
        (“CCP”), or their successor sections, which shall constitute the exclusive
        remedy for the resolution of any Claim, including whether the Claim is subject
        to the reference proceeding. Venue for the reference proceeding will be in
        the
        Superior Court or Federal District Court in Los Angeles County, California
        (the
“Court”).

       

      The
        referee shall be a retired Judge or Justice selected by mutual written agreement
        of the parties. If the parties do not agree, the referee shall be selected
        by
        the Presiding Judge of the Court (or his or her representative). A request
        for
        appointment of a referee may be heard on an ex
        parte
        or
        expedited basis, and the parties agree that irreparable harm would result
        if
ex
        parte
        relief
        is not granted. The referee shall be appointed to sit with all the powers
        provided by law. Pending appointment of the referee, the Court has power
        to
        issue temporary or provisional remedies.

       

      The
        parties agree that time is of the essence in conducting the reference
        proceedings. Accordingly, the referee shall be requested, subject to change
        in
        the time periods specified herein for good cause shown, to (a) set the
        matter for a status and trial-setting conference within forty-five (45) days
        after the date of selection of the referee, (b) if practicable, try all
        issues of law or fact within one hundred twenty (120) days after the date
        of the
        conference and (c) report a statement of decision within twenty (20) days
        after the matter has been submitted for decision.

       

      The
        referee will have power to expand or limit the amount and duration of discovery.
        The referee may set or extend discovery deadlines or cutoffs for good cause,
        including a party’s failure to provide requested discovery for any reason
        whatsoever. Unless otherwise ordered based upon good cause shown, no party
        shall
        be entitled to “priority” in conducting discovery, depositions may be taken by
        either party upon ten (10) days written notice, and all other discovery shall
        be
        responded to within twenty (20) days after service. All disputes relating
        to
        discovery which cannot be resolved by the parties shall be submitted to the
        referee whose decision shall be final and binding.

       

      Except
        as
        expressly set forth in this Agreement, the referee shall determine the manner
        in
        which the reference proceeding is conducted including the time and place
        of
        hearings, the order of presentation of evidence, and all other questions
        that
        arise with respect to the course of the reference proceeding. All proceedings
        and hearings conducted before the referee, except for trial, shall be conducted
        without a court reporter, except that when any party so requests, a court
        reporter will be used at any hearing conducted before the referee, and the
        referee will be provided a courtesy copy of the transcript. The party making
        such a request shall have the obligation to arrange for and pay the court
        reporter. Subject to the referee’s power to award costs to the prevailing party,
        the parties will equally share the cost of the referee and the court reporter
        at
        trial.

       

      The
        referee shall be required to determine all issues in accordance with existing
        case law and the statutory laws of the State of California. The rules of
        evidence applicable to proceedings at law in the State of California will
        be
        applicable to the reference proceeding. The referee shall be empowered to
        enter
        equitable as well as legal relief, provide all temporary or provisional
        remedies, enter equitable orders that will be binding on the parties and
        rule on
        any motion which would be authorized in a trial, including without limitation
        motions for summary judgment or summary adjudication. The referee shall issue
        a
        decision pursuant to CCP Section 644 the referee’s decision shall be entered by
        the Court as a judgment or an order in the same manner as if the action had
        been
        tried by the Court. The final judgment or order or from any appealable decision
        or order entered by the referee shall be fully appealable as provided by
        law.
        The parties reserve the right to findings of fact, conclusions of laws, a
        written statement of decision, and the right to move for a new trial or a
        different judgment, which new trial, if granted, is also to be a reference
        proceeding under this provision.

       

      
        
          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              8

              
                

              

            

            
              
              

            

          

        

      

      If
        the
        enabling legislation which provides for appointment of a referee is repealed
        (and no successor statute is enacted), any dispute between the parties that
        would otherwise be determined by reference procedure will be resolved and
        determined by arbitration. The arbitration will be conducted by a retired
        judge
        or Justice, in accordance with the California Arbitration Act Section 1280
        through Section 1294.2 of the CCP as amended from time to time. The limitations
        with respect to discovery set forth above shall apply to any such arbitration
        proceeding.

       

      THE
        PARTIES RECOGNIZE AND AGREE THAT ALL DISPUTES RESOLVED UNDER THIS REFERENCE
        PROVISION WILL BE DECIDED BY A REFEREE AND NOT BY A JURY. AFTER CONSULTING
        (OR
        HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR OWN CHOICE,
        EACH
        PARTY KNOWINGLY AND VOLUNTARILY AND FOR THEIR MUTUAL BENEFIT AGREES THAT
        THIS
        REFERENCE PROVISION WILL APPLY TO ANY DISPUTE BETWEEN THEM WHICH ARISES OUT
        OF
        OR IS RELATED TO THIS AGREEMENT.

       

      No
        Waiver by Lender.
        Lender
        shall not be deemed to have waived any rights under this Agreement unless
        such
        waiver is given in writing and signed by Lender. No delay or omission on
        the
        part of Lender in exercising any right shall operate as a waiver of such
        right
        or any other right. A waiver by Lender of a provision of this Agreement shall
        not prejudice or constitute a waiver of Lender's right otherwise to demand
        strict compliance with that provision or any other provision of this Agreement.
        No prior waiver by Lender, nor any course of dealing between Lender and
        Borrower, or between Lender and any Grantor, shall constitute a waiver of
        any of
        Lender's rights or of any of Borrower's or any Grantor's obligations as to
        any
        future transactions. Whenever the consent of Lender is required under this
        Agreement, the granting of such consent by Lender in any instance shall not
        constitute continuing consent to subsequent instances where such consent
        is
        required and in all cases such consent may be granted or withheld in the
        sole
        discretion of Lender.

       

      Integration.
        The
        parties agree that (a) this Agreement, together with all of the Related
        Documents, represents the final agreement between the parties, and therefore
        incorporates all negotiations of the parties hereto (b) there are no unwritten
        oral agreements between the parties, and (c) this Agreement may not be
        contradicted by evidence of any prior, contemporaneous, or subsequent oral
        agreements or understandings of the parties.

       

      Notices.
        Any
        notice required to be given under this Agreement shall be given in writing,
        and
        shall be effective when actually delivered, when actually received by
        telefacsimile (unless otherwise required by law), when deposited with a
        nationally recognized overnight courier, or, if mailed, when deposited in
        the
        United States mail, as first class, certified or registered mail postage
        prepaid, directed to the addresses shown near the beginning of this Agreement.
        Any party may change its address for notices under this Agreement by giving
        formal written notice to the other parties, specifying that the purpose of
        the
        notice is to change the party's address. For notice purposes, Borrower agrees
        to
        keep Lender informed at all times of Borrower's current address. Unless
        otherwise provided or required by law, if there is more than one Borrower,
        any
        notice given by Lender to any Borrower is deemed to be notice given to all
        Borrowers.

       

      Severability.
        If a
        court of competent jurisdiction finds any provision of this Agreement to
        be
        illegal, invalid, or unenforceable as to any circumstance, that finding shall
        not make the offending provision illegal, invalid, or unenforceable as to
        any
        other circumstance. If feasible, the offending provision shall be considered
        modified so that it becomes legal, valid and enforceable. If the offending
        provision cannot be so modified, it shall be considered deleted from this
        Agreement. Unless otherwise required by law, the illegality, invalidity,
        or
        unenforceability of any provision of this Agreement shall not affect the
        legality, validity or enforceability of any other provision of this
        Agreement.

       

      Subsidiaries
        and Affiliates of Borrower.
        To the
        extent the context of any provisions of this Agreement makes it appropriate,
        including without limitation any representation, warranty or covenant, the
        word
        "Borrower" as used in this Agreement shall include all of Borrower's
        subsidiaries and affiliates. Notwithstanding the foregoing however, under
        no
        circumstances shall this Agreement be construed to require Lender to make
        any
        Loan or other financial accommodation to any of Borrower's subsidiaries or
        affiliates.

       

      Successors
        and Assigns.
        All
        covenants and agreements by or on behalf of Borrower contained in this Agreement
        or any Related Documents shall bind Borrower's successors and assigns and
        shall
        inure to the benefit of Lender and its successors and assigns. Borrower shall
        not, however, have the right to assign Borrower's rights under this Agreement
        or
        any interest therein, without the prior written consent of Lender.

       

      Survival
        of Representations and Warranties.
        Borrower
        understands and agrees that in extending Loan Advances, Lender is relying
        on all
        representations, warranties, and covenants made by Borrower in this Agreement
        or
        in any certificate or other instrument delivered by Borrower to Lender under
        this Agreement or the Related Documents. Borrower further agrees that regardless
        of any investigation made by Lender, all such representations, warranties
        and
        covenants will survive the extension of Loan Advances and delivery to Lender
        of
        the Related Documents, shall be continuing in nature, shall be deemed made
        and
        redated by Borrower at the time each Loan Advance is made, and shall remain
        in
        full force and effect until such time as Borrower's Indebtedness shall be
        paid
        in full, or until this Agreement shall be terminated in the manner provided
        above, whichever is the last to occur.

       

      Time
        is of the Essence.
        Time is
        of the essence in the performance of this Agreement.

       

      Patriot
        Act Notice. Lender
        hereby notifies Borrower that pursuant to the requirements of the Patriot
        Act,
        Lender is required to obtain, verify and record information identifying
        Borrower, including Borrower’s legal name, address, tax ID number and other
        information that will allow Lender to identify Borrower in accordance with
        the
        Patriot Act. Lender will also require information regarding each personal
        guarantor, if any, and may require information regarding Borrower’s management
        and owners, such as legal name, address, social security number and date
        of
        birth.

       

      DEFINITIONS.
        The
        following capitalized words and terms shall have the following meanings when
        used in this Agreement. Unless specifically stated to the contrary, all
        references to dollar amounts shall mean amounts in lawful money of the United
        States of America. Words and terms used in the singular shall include the
        plural, and the plural shall include the singular, as the context may require.
        Words and terms not otherwise defined in this Agreement shall have the meanings
        attributed to such terms in the Uniform Commercial Code. Accounting words
        and
        terms not otherwise defined in this Agreement shall have the meanings assigned
        to them in accordance with generally accepted accounting principles as in
        effect
        on the date of this Agreement: 

       

      Advance.
        The word
        "Advance" means a disbursement of Loan funds made, or to be made, to Borrower
        or
        on Borrower's behalf on a line of credit or multiple advance basis under
        the
        terms and conditions of this Agreement. 

       

      Agreement.
        The word
        "Agreement" means this Business Loan Agreement, as this Business Loan Agreement
        may be amended or modified from time to time, together with all exhibits
        and
        schedules attached to this Business Loan Agreement from time to time.


      
        
           

          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              9

              
                

              

            

            
              
              

            

          

        

      

      Anti-Terrorism
        Laws. The
        words
“Anti-Terrorism laws” mean any laws relating to terrorism or money laundering,
        including the Patriot Act.

       

      Borrower.
        The word
        "Borrower" means Rubio's Restaurants, Inc., a Delaware corporation and includes
        all co-signers and co-makers signing the Note and all their successors and
        assigns.

       

      Collateral
        Description.
        The word
        "Collateral" as used in this Agreement means the following described property,
        whether now owned or hereafter acquired, whether now existing or hereafter
        arising, and wherever located, in which Borrower is giving to Lender a security
        interest for the payment of the Indebtedness and performance of all other
        obligations under the Note, the Security Agreement, and this
        Agreement:

       

      All
        present and future right, title and interest of Borrower in and to, without
        limitation, all: personal and fixture property of every kind and nature
        including without limitation all goods (including inventory, equipment and
        any
        accessions thereto), instruments (including promissory notes), documents,
        accounts (including health care insurance receivables), chattel paper (whether
        tangible or electronic), deposit accounts, letter of credit rights (whether
        or
        not the letter of credit is evidenced by a writing), commercial tort claims,
        securities and all other investment property, supporting obligations, any
        other
        contract rights or rights to the payment of money, insurance claims and
        proceeds, tort claims, and all general intangibles including, without
        limitation, all payment intangibles, patents, patent applications, trademarks,
        trademark applications, trade names, copyrights, copyright applications,
        software, engineering drawings, service marks, customer lists, goodwill,
        and all
        licenses, permits, agreements of any kind or nature pursuant to which the
        Debtor
        possesses, uses or has authority to possess or use property (whether tangible
        or
        intangible) of others or others possess, use or have authority to possess
        or use
        property (whether tangible or intangible) of the Borrower, and all recorded
        data
        of any kind or nature, regardless of the medium of recording including, without
        limitation, all software, writings, plans, specifications and schematics.
        With
        respect to any term used herein that is defined in either (i) Article 9 of
        the
        Uniform Commercial Code as in force in the jurisdiction in which this agreement
        was signed by Borrower at the time that it was signed, or (ii) Article 9
        as in
        force at any relevant time in the jurisdiction in which the financing statement
        is filed, the meaning to be ascribed thereto with respect to any particular
        item
        of property shall be that under the more encompassing of the two
        definitions. In
        addition, the word "Collateral" also includes all the following, whether
        now
        owned or hereafter acquired, whether now existing or hereafter arising, and
        wherever located:

       

      (A)
        All
        accessions, attachments, accessories, replacements of and additions to any
        of
        the collateral described herein, whether added now or later.

       

      (B)
        All
        products and proceeds of any of the property described in this Collateral
        section.

       

      (C)
        All
        accounts, general intangibles, instruments, rents, monies, payments, and
        all
        other rights, arising out of a sale, lease, consignment or other disposition
        of
        any of the property herein described.

       

      (D)
        All
        proceeds (including insurance proceeds) from the sale, destruction, loss,
        or
        other disposition of any of the property herein described and sums due from
        a
        third party who has damaged or destroyed the Collateral or from that party's
        insurer, whether due to judgment, settlement or other process.

       

      (E)
        All
        records and data relating to any of the property herein described whether
        in the
        form of a writing, photograph, microfilm, microfiche, or electronic media,
        together with all of Borrower's right, title, and interest in and to all
        computer software required to utilize, create, maintain, and process any
        such
        records or data on electronic media.

       

      For
        purposes of clarity, the word “Collateral” shall include the Company’s interests
        in the leases and the equipment for its existing and future restaurant units
        only to the extent allowed by and in accordance with the terms and conditions
        of
        such leases. 

       

      Disclosure
        Schedule.
        The word
“Disclosure Schedule” means that certain Disclosure Schedule drafted by Borrower
        in connection with this Agreement and the Guidance Line.

       

      Environmental
        Laws.
        The
        words "Environmental Laws" mean any and all state, federal and local statutes,
        regulations and ordinances relating to the protection of human health or
        the
        environment, including without limitation the Comprehensive Environmental
        Response, Compensation, and Liability Act of 1980, as amended, 42 U.S.C.
        Section
        9601, et seq. ("CERCLA"), the Superfund Amendments and Reauthorization Act
        of
        1986, Pub. L. No. 99-499 ("SARA"), the Hazardous Materials Transportation
        Act,
        49 U.S.C. Section 1801, et seq., the Resource Conservation and Recovery Act,
        42
        U.S.C. Section 6901, et seq., Chapters 6.5 through 7.7 of Division 20 of
        the
        California Health and Safety Code, Section 25100, et seq., or other applicable
        state or federal laws, rules, or regulations adopted pursuant
        thereto.

       

      Event
        of Default.
        The
        words "Event of Default" mean any of the events of default set forth in this
        Agreement in the default section of this Agreement.

       

      GAAP.
        The word
        "GAAP" means generally accepted accounting principles. 

       

      Grantor.
        The word
        "Grantor" means each and all of the persons or entities granting a Security
        Interest in any Collateral for the Loan, including without limitation all
        Borrowers granting such a Security Interest. 

       

      Guarantor.
        The word
        "Guarantor" means any guarantor, surety, or accommodation party of any or
        all of
        the Loan.

       

      Guaranty.
        The word
        "Guaranty" means the guaranty from Guarantor to Lender, including without
        limitation a guaranty of all or part of the Note.

       

      Guidance
        Line. The
        word
“Guidance Line” means that certain Business Loan Agreement entered into among
        Borrower and Lender dated May 13, 2008 (as the same may be amended or modified
        from time to time, together with all exhibits and schedules attached to such
        Guidance Line from time to time) pursuant to which Lender provided Borrower
        a
        Guidance Line.

       

      Hazardous
        Substances.
        The
        words "Hazardous Substances" mean materials that, because of their quantity,
        concentration or physical, chemical or infectious characteristics, may cause
        or
        pose a present or potential hazard to human health or the environment when
        improperly used, treated, stored, disposed of, generated, manufactured,
        transported or otherwise handled. The words "Hazardous Substances" are used
        in
        their very broadest sense and include without limitation any and all hazardous
        or toxic substances, materials or waste as defined by or listed under the
        Environmental Laws. The term "Hazardous Substances" also includes, without
        limitation, petroleum and petroleum by-products or any fraction thereof and
        asbestos.

       

      Indebtedness.
        The word
        "Indebtedness" means the indebtedness evidenced by the Note or Related
        Documents, including all principal and interest together with all other
        indebtedness and costs and expenses for which Borrower is responsible under
        this
        Agreement or under any of the Related Documents.

       

      Lender.
        The word
        "Lender" means Pacific Western Bank, its successors and assigns. 

      
        
           

          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              10

              
                

              

            

            
              
              

            

          

        

      

      Loan.
        The word
        "Loan" means any and all loans and financial accommodations from Lender to
        Borrower whether now or hereafter existing, and however evidenced, including
        without limitation those loans and financial accommodations described herein
        or
        described on any exhibit or schedule attached to this Agreement from time
        to
        time.

       

      Loan
        Date.
        The word
“Loan Date” means May 13, 2008.

       

      Loan
        Documents. The
        word
“Loan Documents” means this Agreement, the Guidance Line, and all Related
        Documents.

       

      Maturity
        Date. The
        word
“Maturity Date” means May 13, 2010.

       

      Note.
        The word
        "Note" means the Note executed by Rubio's Restaurants, Inc., a Delaware
        corporation in the principal amount of $5,000,000.00 dated May 13, 2008,
        together with all renewals of, extensions of, modifications of, refinancings
        of,
        consolidations of, and substitutions for the note or credit
        agreement.

       

      Obligor.
        The
        word
“Obligor” means Borrower, Guarantor, or other Person that is liable for payment
        of any Obligations or that has granted a Lien in favor of Agent on its assets
        to
        secure any Obligations.

       

      Patriot
        Act. The
        words
“Patriot Act” means and refers to Uniting
        and Strengthening America by Providing Appropriate Tools Required to Intercept
        and Obstruct Terrorism Act of 2001, Pub. L. No. 107-56, 115 Stat. 272
        (2001).

       

      Permitted
        Acquisition.
        Any
        acquisition that conforms to all of the following requirements: (i) the assets,
        division or line of business to be acquired is primarily in a substantially
        similar line of business as the Borrower’s, (ii) the assets, division or line of
        business to be acquired shall be used towards expansion of Borrower’s existing
        business operations, or the establishment of the Borrower’s future Rubio’s
        restaurant units, (iii) all transactions related to such acquisition shall
        be
        consummated in accordance with applicable law; and (iv) all such assets,
        divisions or lines of business acquired shall be (a) owned directly by Borrower
        or any Guarantor that has granted a Security Interest to Lender, and (b)
        subject
        to Lender’s Security Interest under the Loan Documents.

       

      Permitted
        Liens.
        The
        words "Permitted Liens" mean (1) liens and security interests securing
        Indebtedness owed by Borrower to Lender; (2) liens for taxes, assessments,
        or
        similar charges either not yet due or being contested in good faith; (3)
        liens
        of materialmen, mechanics, warehousemen, or carriers, or other like liens
        arising in the ordinary course of business and securing obligations which
        are
        not yet delinquent or are being contested in good faith by appropriate
        proceedings and Borrower shall have established on Borrower’s books adequate
        reserves with respect to such contested lien or claim in accordance with
        GAAP;
        (4) purchase money liens or purchase money security interests upon or in
        any
        property acquired or held by Borrower in the ordinary course of business
        to
        secure indebtedness outstanding on the date of this Agreement or permitted
        to be
        incurred under the paragraph of this Agreement titled "Indebtedness and Liens";
        (5) liens and security interests which, as of the date of this Agreement,
        have
        been disclosed to and approved by the Lender in writing, including the liens
        and
        security interests, if any, of the landlords for the Company’s existing and
        future restaurant units; and (6) those liens and security interests which
        in the
        aggregate constitute an immaterial and insignificant monetary amount with
        respect to the net value of Borrower's assets; and (7) liens not to exceed
        ***
        in the
        aggregate (i) upon or in any equipment acquired or held by the Borrower to
        secure the purchase price of such equipment or indebtedness incurred solely
        for
        the purpose of financing the acquisition or lease of such equipment, or (ii)
        existing on such equipment at the time of its acquisition, provided that
        the
        lien is confined solely to the property so acquired and improvements thereon,
        and the proceeds of such equipment.

       

      Person.
        The
        word
“Person” means any individual, corporation, limited liability company,
        partnership, joint venture, joint stock company, land trust, business trust,
        unincorporated organization, Governmental Authority or other entity.


       

      Related
        Documents.
        The
        words "Related Documents" mean all promissory notes, credit agreements, loan
        agreements, environmental agreements, guaranties, security agreements,
        mortgages, deeds of trust, security deeds, collateral mortgages, disclosure
        schedules, and all other instruments, agreements and documents, whether now
        or
        hereafter existing, executed in connection with this Loan or the Guidance
        Line.

       

      Security
        Agreement.
        The
        words "Security Agreement" mean and include without limitation any agreements,
        promises, covenants, arrangements, understandings or other agreements, whether
        created by law, contract, or otherwise, evidencing, governing, representing,
        or
        creating a Security Interest. 

       

      Security
        Interest.
        The
        words "Security Interest" mean, without limitation, any and all types of
        collateral security, present and future, whether in the form of a lien, charge,
        encumbrance, mortgage, deed of trust, security deed, assignment, pledge,
        crop
        pledge, chattel mortgage, collateral chattel mortgage, chattel trust, factor's
        lien, equipment trust, conditional sale, trust receipt, lien or title retention
        contract, lease or consignment intended as a security device, or any other
        security or lien interest whatsoever whether created by law, contract, or
        otherwise.

       

      Subsidiaries.
        The word
“Subsidiaries” means, collectively, Rubio's Promotions, Inc., an Arizona
        corporation, and Rubio's Restaurants of Nevada, Inc., a Nevada
        corporation.

       

      UCC.
        The
        word
“UCC” means Uniform Commercial Code.

       

       

      
        ***
          Portions
          of this page have been omitted pursuant to a request for Confidential Treatment
          and filed separately with the Commission.

        
           

          
            
              
                Rubio’s
                  Restaurants, Inc.-Line #400461335

                Business
                  Loan Agreement (04-2008)

              

            

            
              11

              
                

              

            

            
              
              

            

          

        

      

       

       

    

    
      BORROWER
        ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS BUSINESS LOAN AGREEMENT
        AND
        BORROWER AGREES TO ITS TERMS. THIS BUSINESS LOAN AGREEMENT IS DATED MAY 13,
        2008.

       

      BORROWER:

       

      RUBIO'S
        RESTAURANTS, INC., A DELAWARE CORPORATION

       

      


      
        	
                By:
                  /s/
                  Daniel E.
                  Pittard                                              
                  

                Daniel
                  E. Pittard, President/CEO of Rubio's 

                Restaurants,
                  Inc., a Delaware corporation

              	
                By:
                  /s/
                  Frank
                  Henigman                                    
                  

                Frank
                  Henigman, Chief Financial Officer of 

                Rubio's
                  Restaurants, Inc., a Delaware
                  corporation

              


      

      


       

      LENDER:

       

      PACIFIC
        WESTERN BANK

       

      


      By:
        /s/
        Eric E. Baird, VP______________________

      Authorized
        Signer

      


       

       

      

        S-1

        Business
          Loan Agreement (Line #400461335)