Exhibit 10.20


 


NONQUALIFIED STOCK OPTION AGREEMENT


THE TORO COMPANY 2000 DIRECTORS STOCK OPTION
PLAN


 


Agreement
dated November   , 20   , between The Toro
Company, a Delaware corporation (“Toro”), and <<name>> (“you”)
setting forth the terms and conditions of the grant to you of a nonqualified
option to purchase           
shares of Toro Common Stock, at an exercise price of    .   
per share, under The Toro Company 2000 Directors Stock Option Plan (“Plan”).


 


1.                                       Expiration
Date.  This option shall expire on November    ,
20   .


 


2.                                       Vesting.  Except as provided in Sections 3 and 5, this
option shall vest and become exercisable in three approximately equal
installments on each of the first, second and third anniversaries after the
date of grant.


 


3.                                       Exercise.
 Except as provided in Section 2 or
as otherwise provided in this section, you may exercise the option only while
you are a director of Toro and only if you have been continuously serving since
the date of grant, except as follows:


 


	
  (a)

  	
   

  	
  If you
  become disabled, this option will vest in full on the date your service
  ceases by reason of such disability, and you or your guardian or legal
  representative may exercise the option until the earlier of the date the
  option expires or one year after the date your service ceases by reason of
  your disability.

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  If you die,
  this option will vest immediately, and your legal representatives, heirs or
  legatees may exercise the option until the earlier of the date it expires or
  one year after the date of your death.

  
	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  If you have served as a member of the Board for ten full fiscal years
  or longer and terminate service on the Board, (i) the option will
  continue to vest in accordance with its terms and (ii) you may exercise
  the vested portion of the option for up to four years after the date of
  termination, but not later than the date the option expires.

  
	
   

  	
   

  	
   

  
	
  (d)

  	
   

  	
  If you have served as a member of the Board for less than ten full
  fiscal years and terminate service on the Board, (i) any unvested
  portion of the option shall expire and be canceled and (ii) you may
  exercise any vested portion of the option for up to three months after the
  date of termination, but not later than the date the option expires.

  



 


4.                                       No
Transfer. You may not transfer this option other than by will or applicable
laws of descent and distribution.


 

















 


5.                                       Change
of Control. This option will vest in full if there is a Change of Control of
Toro, as defined in the Plan as in effect at the date of such event, and will
remain exercisable for three years following the Change of Control, but not
later than the date the option expires.


 


6.                                       Methods
of Exercise.  In order to exercise this
option, you must deliver to the office of the Secretary of Toro a written
notice of exercise specifying the number of whole shares with respect to which
you wish to exercise this option, accompanied by payment in full of the
exercise price for the shares to be purchased. 
Payment may be made in (a) cash, (b) by tendering shares of
Common Stock already owned for at least six months, valued at the 4 p.m.
Eastern Time closing price on the date of exercise (or if a holiday, the most
recent closing price), (c) in a combination of cash and Common Stock, or (d) by
tendering a notice of exercise of options and irrevocable instructions to a
brokerage firm and Toro to execute a cashless exercise in accordance with the
terms of the Plan.


 


7.                                       General
Restriction.  If at any time the Board of
Directors  determines that the listing,
registration or qualification of the Common Stock subject to the option on any
securities exchange or under any state or federal law, or the consent or,
approval of any government regulatory body, is necessary or desirable as a
condition of, or in connection with, the issue or purchase of Common Stock
under this option, this option may not be exercised unless such listing,
registration, qualification, consent or approval has been obtained free of
conditions not acceptable to the Board.


 


8.                                       Tax
Withholding.   If you exercise this
option, you will recognize ordinary income to the extent that the exercise
price is lower than the fair market value of the Common Stock on the exercise
date (the “spread”) and you will owe income tax on the spread.  Toro has the right to deduct from any
settlement made upon your exercise of the option, any federal, state or local
taxes of any kind required by law to be withheld with respect to the income
recognized, or to require you to pay the amount of any such taxes or to take
such other action as may be necessary in the opinion of Toro to satisfy all
obligations for payment of such taxes. 
If Common Stock is withheld or surrendered to satisfy tax withholding,
such stock will be valued at its fair market value as of the date it is
withheld or surrendered.  Toro may also
deduct from any such settlement any amounts you may owe Toro.


 


  9.                                 Governing
Law. This Agreement shall be construed, administered and governed in all
respects under and by the applicable laws of the State of Delaware, excluding
any conflicts or choice of law rule or principle that might otherwise
refer construction or interpretation to the substantive law of another
jurisdiction.


 


10.                                 Conflict.  To the extent the terms of this agreement are
inconsistent with the Plan, the provisions of the Plan shall control and
supersede any inconsistent provision of this agreement.


 


11.                                 Non-negotiable
Terms.  The terms of this option are not
negotiable, but you may refuse to accept this option by notifying Toro’s
Corporate Secretary in writing.


 


IN WITNESS
WHEREOF, this option agreement has been executed and


 

















 


delivered by The Toro Company.


 


 


	
  November   , 2008 

  	
  By:

  	
   

  
	
   

  	
   Chairman & CEO

  



 

















 


I hereby agree
to the terms and conditions governing this option grant as set forth in this
agreement, acknowledge that I have received electronically a copy of the
Prospectus relating to the Toro Common Stock and agree to accept electronic
delivery of the Prospectus, Toro’s Annual Report on Form 10-K and
Quarterly Report on Form 10-Q and Current Reports on Form 8-K by
email directed to my Toro email address.


 


Note:  If you do not wish to
accept this option on the terms stated in this agreement, please contact Toro’s
Corporate Secretary immediately to decline the grant.