Unassociated Document


    

      EXHIBIT
        10.1

      
 

      


      December
        8, 2004

       

      


      Mr.
        Carl
        A. Arena

      2268
        N.
        Wisteria Lane

      Orange,
        CA 92867

      (714)
        283-2607

      


      Dear
        Carl:

      


      I
        am
        pleased to confirm our offer of employment made to you for the position of
        Vice
        President, Development for Rubio’s Restaurants, Inc. (Rubio’s) reporting
        directly to me under the terms and conditions outlined below:

      


      Start
        Date:
        To be
        mutually agreed upon, and as soon as feasible. 

      


      Base
        Salary:
        An
        annual rate of $160,000 paid biweekly at a rate of $6,153.85 and subject
        to
        withholdings and deductions as required by law. Your salary will be reviewed
        annually and may be adjusted based on such review. You will be eligible for
        review with merit increase consideration, beginning with the 2006 review
        cycle.

      


      Bonus
        Plan:
        For the
        current Fiscal year, you will be eligible to participate in the Executive
        Level
        Bonus Plan at a rate of up to 25% of your prorated base salary. In addition,
        you
        will be eligible for a prorated portion of the 2004 “above plan” pool for
        exceeding EPS targets, as described in the plan document. The bonus plan
        will be
        adjusted if changes are made to GAAP or accounting principles permitted by
        SEC
        rules. Bonuses are paid post completion of the audited annual financial results,
        typically following the first quarter of the following year. Bonus is paid
        out
        based on the Company’s successfully meeting/exceeding annual EPS
        plan.

       

      Annual
        bonus plans will be developed for subsequent years and ultimately approved
        by
        the Compensation Committee within a reasonable period of time prior to the
        beginning of the following fiscal year.

      


      You
        may
        also participate in other bonus or incentive plans adopted by Rubio’s that are
        applicable to your position. 

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
            Carl
              Arena

            12/8/2004

            Page
              2
of
              5 

          

        

      

      


      Stock
        Options:
        Stock
        Options for 75,000 shares of Rubio’s Restaurants, Inc. common stock, pursuant
        and subject to Rubio’s 1999 Stock Incentive Plan, will be granted to you on your
        Start Date at the day’s closing market price. They will vest at 20% at the end
        of the first year and each month thereafter for 48 months on a pro-rata basis.
        You will also be eligible for any discretionary annual option grants and
        incentive option grants which may become available in the future. 

      


      Vacation:
        15 days
        per year accrued pro-rata on a monthly basis.

      


      Health
        Plans:
        You
        will be eligible to participate in Rubio’s medical (including Exec-U-Care),
        dental, employee assistance program (EAP), vision, short and long term
        disability, and life insurance programs (executive level term life insurance
        is
        two times annual salary) effective the first day of the month following two
        consecutive months of service. You will be reimbursed for any COBRA premiums
        incurred during this waiting period. Executives contribute approximately
        10% of
        premium costs. Monthly medical contributions are between $60.00 (HMO) and
        $125.00 (PPO) for family coverage. The Company offers an executive health
        expense reimbursement program with a $5,000 cap and a Flexible Spending Account
        for tax deferred contributions for medical and childcare expenses. 

      


      Professional
        Reimbursements:
        You will
        be reimbursed for reasonable expenses necessarily incurred in the performance
        of
        your duties, including, but not limited to, cell phone service, long distance
        telephone service, facsimile and duplication services, overnight and courier
        services, travel expenses, expenses related to attendance at industry
        conferences and membership in industry associations. 

      


      401(k)
        Plan:
        You
        will be eligible to participate in Rubio’s 401(k) Plan effective the first day
        of the month following two consecutive months of service. (Although our 401(k)
        plan allows for up to 15% of compensation as an employee’s contribution, you
        should be aware that our most recent discrimination testing has limited actual
        contributions for highly paid executives to approximately 1%.). 

      


      Meal
        Discount:
        You and
        your family will be eligible for a meal discount of 50% at Rubio’s Restaurants.


      


      Relocation
        of Household Goods:
        You
        will be relocating to the San Diego area by a mutually agreed upon time.
        You
        will be reimbursed for all applicable moving expenses up to $50,000 which
        is
        expected to cover all reasonable relocation costs for you and your family
        (i.e.,
        home sale, home purchase, temporary housing, movement of household goods,
        etc.).
        Amounts above the allowable IRS reimbursements for relocation will be grossed-up
        for taxes at the applicable state and federal tax rates. You will need to
        submit
        relocation expense receipts to Rubio’s Controller who will work with you to
        mitigate the tax impact for both you and the Company.

      


      Re-payment
        of Relocation Expenses:
        Should
        you resign from your position on a voluntary basis within the first twelve
        (12)
        months of employment you agree to reimburse Rubio’s for 100% of your submitted
        relocation expenses. Should you resign after twelve (12) months, you agree
        to
        reimburse Rubio’s on a pro-rata basis whereby your relocation expense debt would
        be reduced by 1/12 for each of the next twelve (12) months you remain employed
        with Rubio’s. After twenty-four (24) months of consecutive employment no
        repayment of relocation expense would be required. 

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
            Carl
              Arena

            12/8/2004

            Page 3
              of
              5 

          

        

      

       

      Severance
        Benefits:
        While
        Rubio’s does not have a formal severance policy, we are offering the following:
        If your employment is terminated, without Cause or upon Disability, as defined
        below, you will be paid, subject to signing our standard release agreement,
        six
        (6) months of current salary if separation is within the first twelve (12)
        months of employment and three (3) months of current salary thereafter. All
        severance payments will be made in bi-weekly installments and subject to
        all
        appropriate deductions and withholdings. In addition, you will have continued
        enrollment in the health and welfare plans (with the exception of the 401(k)
        plan as precluded by our Plan), including life insurance, for the period
        of
        severance or until your eligibility under another employer’s group benefit plan,
        whichever event occurs first. 

      


      Disability:“Disability”
        means the medical determination that you are eligible for benefits under
        the
        Company’s long term disability insurance plan.

      


      Cause:“Cause”
        means: (a) willful failure by you to substantially perform your duties under
        this agreement, other than a failure resulting from your complete or partial
        incapacity due to physical or mental illness or impairment (b) conviction
        of or
        a plea of “guilty” or “no contest” to, a felony or crime involving an act of
        moral turpitude, dishonesty, or misfeasance under the laws of the United
        States
        or any state thereof; (c) refusal to follow, or material neglect of, reasonable
        requests of the Company’s Board of Directors or its designee(s), if unremedied
        following thirty (30) days’ written notice; (d) conduct that substantially
        interferes with or damages the standing, reputation, financial condition
        or
        prospects of the Company, after you have been given ten (10) days’ notice and an
        opportunity to respond; or (e) a material or willful violation of a federal
        or
        state law or regulation applicable to the business of the Company. If your
        employment is terminated without Cause you shall be paid the Severance Benefits
        described above under Severance Benefits.

      


      At-Will
        Employment: Employment
        with Rubio’s Restaurants, Inc. is not for a specific term and can be terminated
        by you or the Company at any time and for any reason, with or without cause
        or
        advanced notice. The At-Will nature of your employment described in this
        offer
        letter shall constitute the entire agreement between you and Rubio’s concerning
        the nature and duration of your employment and the circumstance under which
        you
        or the Company may terminate the employment relationship. No oral statement
        by
        any person can change the At-Will nature of your employment with
        Rubio’s.

      


      Although
        your job duties, title, and compensation benefits may change over time, the
        At-Will term of your employment with Rubio’s can only be changed in writing,
        signed by you and the President or Chairman of the Company, and which expressly
        states the intention to change the At-Will term of your employment. Any prior
        representations to the contrary are superseded by the terms of this offer.
        

      


      Confidentiality
        and Non-Solicitation:
        One of
        the conditions of your employment with Rubio’s is the maintenance of the
        confidentiality of Rubio’s proprietary and confidential information. You agree
        during and after the period of your employment with Rubio’s not to use, directly
        or indirectly, any confidential information other than in the course of
        performing duties as an employee of Rubio’s. You further agree that during your
        term of employment and for two (2) years thereafter, not to encourage or
        solicit, directly or indirectly, any employee of Rubio’s to leave the Company
        for any reason. You will be required to execute the Company’s Proprietary
        Information and Inventions Agreement on your first day of employment.


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
            Carl
              Arena

            12/8/2004

            Page 4
              of
              5 

          

        

      

       

      Company
        Policy:
        As an
        employee of Rubio’s, you will be required to comply with all Company policies
        and procedures. In particular, you will be required to familiarize yourself
        with
        and to comply with Rubio’s policy prohibiting harassment and discrimination and
        the policy concerning drugs and alcohol. Violations of these policies may
        lead
        to immediate termination of employment.

      


      Arbitration:
        Rubio’s
        maintains a policy of mandatory arbitration. This means that any and all
        disputes that you may have with Rubio’s, or any of Rubio’s other employees,
        which arise out of your employment, will be resolved through final and binding
        arbitration. This includes, without limitation, disputes relating to offer
        letters, your employment by Rubio’s or the termination thereof, claims for
        breach of contract, claims for breach of covenant of good faith and fair
        dealing, any claims of discrimination or harassment, any claims under any
        federal, state or local law or regulation now in existence or hereinafter
        enacted and amended from time to time concerning in any way the subject of
        your
        employment with Rubio’s or your termination. You agree that arbitration shall be
        instead of any civil lawsuit and you waive your right to pursue any and all
        employment-related claims in court.

      


      This
        letter supersedes any prior agreements, representations or promises of any
        kind,
        express or implied, concerning your employment and it constitutes the full
        and
        complete agreement between you and the Company.

      


      The
        foregoing offer of employment with Rubio’s is contingent upon your successful
        completion of a background and reference checks, pre-employment drug and
        alcohol
        screen, your execution of this letter, the Company’s Proprietary Information and
        Inventions Agreement, the Company’s Arbitration Agreement and all other forms
        presented at the time of hire. This offer is further contingent upon the
        Company’s verification of the information provided to us in your application
        form, resume and attachments, if any.

      


      The
        existence and terms of this offer letter should remain confidential except
        for
        disclosure to your spouse, attorneys, accountants and other tax or financial
        professional advisors to whom the disclosure is necessary.

      


      Carl,
        we
        are very excited about your joining our team. We are confident that you have
        much to contribute to the success of Rubio’s. The strength of our organization
        and our brand, the quality and experience of our team, and your contributions
        will facilitate this success.

      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
            Carl
              Arena

            12/8/2004

            Page 5
              of
              5 

          

        

      

       

      Assuming
        you wish to accept our offer of employment on the terms described herein,
        please
        acknowledge your acceptance by signing below and returning the original to
        me
        within seven (7) business days. A copy of this letter has been enclosed for
        your
        records. If you have any questions, please do not hesitate to contact me
        by
        calling (760) 602-3625.

      


      


      Sincerely,

      


      


      /s/
        Sheri
        Miksa                                          
        
Sheri Miksa

      President
        and Chief Executive Officer

      Rubio’s
        Restaurants, Inc. 

      
 

      


      I
        have
        read, understand and accept the terms and conditions of the above offer of
        employment.

      


      


      


      


      Accepted: /s/
        Carl
        Arena                               
         Date:
        __________________ 

                         
        Carl Arena