Document:

ex10_2.htm

    

      Exhibit 10.1

       

      AMENDED AND RESTATED
REPURCHASE AGREEMENT

       

      (Two
Step)

       

      This
Amended and Restated Repurchase Agreement (“Agreement”) is entered into as
of January 29, 2010 (“Effective
Date”) by and between THE TORO COMPANY, a Delaware
corporation, a manufacturer (hereinafter “Seller”), and RED IRON ACCEPTANCE, LLC, a
Delaware limited liability company (“Red Iron”), to set forth the
terms and conditions under which Red Iron will provide financing for certain
dealers and distributors as set forth below.  This Agreement amends
and restates in its entirety that certain Repurchase Agreement (Two Step) dated
as of October 1, 2009 by and between Seller and Red Iron. In consideration of
the matters and mutual agreements herein contained, Red Iron and Seller agree as
follows:

       

      
        	
                1.

              	
                Definitions.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                “Approval” herein shall
      mean Red Iron’s agreement, whether in writing, by electronic transmission
      or orally (provided, however, that such oral agreement be promptly
      confirmed in writing), to provide floorplan inventory financing for the
      sale of Inventory by Seller or an affiliate of Seller to a Dealer and/or
      Distributor, which agreement shall be in effect for a period of sixty (60)
      days from the date issued.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                “Average Receivables”
      herein shall mean, with respect to an annual period (or such shorter
      period at the end of the term of this Agreement or as otherwise specified
      herein), the sum of the ending receivable balances of Red Iron associated
      with the Challenged Dealers for each month included in such annual period
      (or of each month in the current calendar year in the case of the
      calculation for the end of the term of this Agreement or as otherwise
      specified herein) divided by 12 or such lesser number of months for any
      period of less than one year.  Receivable balances for the
      purposes of this definition shall be the unpaid principal balances of the
      receivables without taking into account any provision for credit loss,
      interest due thereon or any miscellaneous amounts payable in connection
      with the collection thereof.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                “Challenged Dealer
      Invoice” herein shall mean Invoices associated with a Challenged
      Dealer.

              

      

       

      
        	
                 
      

              	
                (d)

              	
                “Dealer” herein shall
      mean any person, firm or corporation which buys Inventory at wholesale
      from Seller or an affiliate of Seller and sells Inventory at
      retail.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                “Dealer Invoice” herein
      shall mean an invoice, bill of sale or other evidence, whether in writing
      or electronically transmitted, of the sale or delivery of Inventory by
      Seller or an affiliate of Seller to a
Dealer.

              

      

       

      
        	
                 
      

              	
                (f)

              	
                “Distributor” herein
      shall mean any person, firm, corporation or buying group which buys
      Inventory from Seller or an affiliate of Seller and sells Inventory at
      wholesale.

              

      

       

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                (g)

              	
                “Distributor Dealer”
      herein shall mean any person, firm or corporation which buys Inventory at
      wholesale from a Distributor and sells Inventory at
  retail.

              

      

       

      
        	
                 
      

              	
                (h)

              	
                “Distributor Invoice”
      herein shall mean an invoice, bill of sale or other evidence, whether in
      writing or electronically transmitted, of the sale or delivery of
      Inventory by Seller or an affiliate of Seller to a
      Distributor.

              

      

       

      
        	
                 
      

              	
                (i)

              	
                “Distributor to Dealer
      Invoice” herein shall mean an invoice, bill of sale or other
      evidence, whether in writing or electronically transmitted, of the sale or
      delivery of Inventory by a Distributor to a Dealer or a Distributor
      Dealer.

              

      

       

      
        	
                 
      

              	
                (j)

              	
                “Inventory” herein shall
      mean any and all products, including parts and accessories, software and
      related services manufactured, distributed or sold at wholesale by Seller
      or an affiliate of Seller.

              

      

       

      
        	
                 
      

              	
                (k)

              	
                “Invoice” herein shall
      mean a Dealer Invoice, a Distributor Invoice and/or a Distributor to
      Dealer Invoice, either collectively or individually, as the case may
      be.

              

      

       

      
        	
                 
      

              	
                (l)

              	
                “Wholesale Instrument”
      herein shall mean an Invoice, billing statement, inventory schedule or
      other evidence of indebtedness, including the books and records of Red
      Iron, arising out of the financing by Red Iron of an
    Invoice.

              

      

       

      
        	
                2.

              	
                Financing
      Program.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                If
      Seller or an affiliate of Seller requests an Approval or sends to Red Iron
      an Invoice, and the Dealer and/or Distributor related to such Approval or
      Invoice is eligible for floorplan inventory financing in accordance with
      the credit and operational policies of Red Iron, then Red Iron shall, from
      time to time in its commercially reasonable discretion consistent with
      such credit and operational policies, issue such Approvals and advance
      against such Invoices, all under the terms of this Agreement. Upon
      issuance of an Approval by Red Iron, Seller shall (or, as applicable,
      shall cause its affiliate to) deliver an original Invoice to Red Iron.
      Provided Red Iron receives the Invoice within sixty (60) days of the date
      Red Iron issued the Approval and within thirty (30) days of the ship date
      referred to in the Invoice, Red Iron shall pay Seller or its affiliate, as
      applicable, the amount of the Invoice, subject to the terms of the
      financing program then in effect between Seller and Red Iron. If the
      Invoice is not received within said 60- and 30-day periods, or is not
      acceptable in form or content once received, Red Iron has the right,
      without notice to Seller or its affiliate, as applicable, to cancel the
      Approval related to said Invoice. Prior to funding any Approval, Red Iron
      has the right to cancel said Approval upon oral or written notice
      (provided, however, that oral notice be promptly confirmed in writing) to
      Seller or its affiliate, as applicable, should Dealer or Distributor be in
      default of any of its obligations to Red Iron and provided that Seller or
      its affiliate, as applicable, has not shipped Inventory in reliance on Red
      Iron’s Approval. Advances on Invoices and Approvals for such advances
      issued by Red Iron as provided hereunder
shall

              

      

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                constitute
      an acceptance of the terms and conditions hereof by Seller (for itself or
      on behalf of its affiliate, as applicable) and Red Iron as to each such
      advance, and no other act or notice shall be required on the part of Red
      Iron or Seller (or its affiliate, as applicable) to entitle such advances
      and Approvals to the benefits of this Agreement. Red Iron may deduct,
      set-off, withhold and/or apply any sums from payments due to Seller
      (either on behalf of itself or its affiliate, as applicable) from Red Iron
      under this Agreement any sums or payments due to Red Iron from Seller
      and/or its affiliates in respect of any advance to be made by Red Iron
      against any Invoice.  Seller and Red Iron may from time to time
      enter into written agreements for any Seller sponsored special financing
      program for Dealers and/or
Distributors.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                If
      Seller or an affiliate of Seller delivers to Red Iron an original Invoice
      that is the subject of open account financing of inventory and related
      items and the amount of such Invoice is within (i) pre-established credit
      limits applicable to the Dealer and/or Distributor related to such Invoice
      and (ii) unsecured credit limits established by Red Iron from time to time
      (which shall not be less than $4,000,000 in the aggregate at any time
      unless otherwise agreed by the parties hereto), then Red Iron shall, from
      time to time in its commercially reasonable discretion consistent with the
      credit and operational policies of Red Iron, make an advance against such
      Invoice under the terms of this Agreement.  Subject to the
      foregoing, if Red Iron receives the Invoice within thirty (30) days of the
      ship date referred to in the Invoice, Red Iron shall pay Seller or its
      affiliate, as applicable, the amount of the Invoice, subject to the terms
      of the financing program then in effect between Seller and Red
      Iron.  Advances on Invoices issued by Red Iron as provided
      hereunder shall constitute an acceptance of the terms and conditions
      hereof by Seller (for itself or on behalf of its affiliate, as applicable)
      and Red Iron as to each such advance, and no other act or notice shall be
      required on the part of Red Iron or Seller (or its affiliate, as
      applicable) to entitle such advances to the benefits of this
      Agreement.  Red Iron may deduct, set-off, withhold and/or apply
      any sums from payments due to Seller (either on behalf of itself or its
      affiliate, as applicable) from Red Iron under this Agreement any sums or
      payments due to Red Iron from Seller and/or its affiliates in respect of
      any advance to be made by Red Iron against any
  Invoice.

              

      

       

      
        	
                 
      

              	
                (c)

              

      

       

      
        	
                 
      

              	
                (1)

              	
                If
      (i) Seller or an affiliate of Seller requests an Approval or sends to Red
      Iron an Invoice or requests that Red Iron accept a group of Invoices
      attributable to a single Dealer or Distributor, which would otherwise be
      subject to Section 2(a) above but for the fact that the Dealer and/or
      Distributor related to such Approval or Invoice is not eligible for
      floorplan inventory financing in accordance with the credit and
      operational policies of Red Iron or (ii) Seller or an affiliate of Seller
      delivers to Red Iron an original Invoice or requests that Red Iron accept
      a group of Invoices attributable to a single Dealer or Distributor, which
      would otherwise be subject to Section 2(b) above but for the fact that
      such Invoice fails to

              

      

       

      
        
           

        

        
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                meet
      the requirements of Section 2(b) (in either case whether as part of an
      individual request or group request a “Non-conforming
      Invoice”), then, provided such request indicates that any such
      Non-conforming Invoice is subject to the Non-conforming Invoice Recourse
      Obligation set forth below, Red Iron shall, from time to time in its
      commercially reasonable discretion, issue such Approval and advance
      against such Non-conforming Invoice, all under the terms of this Agreement
      including the applicable terms set forth in Section 2(a) and 2(b) above
      but subject to the Non-conforming Invoice Recourse Obligation. Seller
      hereby requests that Red Iron accept all Invoices which would otherwise be
      subject to Section 2(a) or Section 2(b) with respect to the
      Dealers/Distributors listed on Schedule 1 attached hereto and agrees that
      all such Invoices are subject to the Non-conforming Invoice Recourse
      Obligation.

              

      

       

      
        	
                 
      

              	
                (2)

              	
                If
      a Dealer or Distributor shall default in the payment of any Non-conforming
      Invoice, after the expiration of any cure period applicable to such
      Non-conforming Invoice and upon demand by Red Iron which shall set forth
      in reasonable detail the nature of such default, Seller shall repurchase
      such Non-conforming Invoice from Red Iron as provided below, which
      repurchase, subject to Seller’s performance thereof, shall be Red Iron’s
      sole and exclusive remedy with respect to such defaulted Non-conforming
      Invoice (such repurchase obligation being referred to herein as the “Non-conforming Invoice
      Recourse Obligation”). In connection with such repurchase, Seller
      shall pay to Red Iron in immediately available funds not later than five
      (5) business days after Seller’s receipt from Red Iron of demand for the
      repurchase of such Non-conforming Invoice, in payment for such repurchase,
      an amount equal to the outstanding balance (including accrued but unpaid
      interest) remaining unpaid under such Non-conforming Invoice. The payment
      of such amount in immediately available funds shall otherwise be
      considered payment in full of such Non-conforming
  Invoice.

              

      

       

      
        	
                 
      

              	
                (3)

              	
                Upon
      the payment required to be made to Red Iron as provided in clause (c)(2),
      Red Iron shall automatically and without further action be deemed to
      transfer, assign, set over and otherwise convey to Seller or its designee,
      without recourse, representation or warranty, except as set forth in the
      immediately following sentence, all the right, title and interest of Red
      Iron in and to the applicable Non-conforming Invoice and any related
      Wholesale Instrument, all moneys due or to become due and all collateral
      security with respect thereto and all amounts received with respect
      thereto and all proceeds thereof. Such transfer shall be free and clear of
      any liens created by or through Red Iron.  Any collections
      received by Red Iron after the date of transfer with respect to any
      Non-conforming Invoices transferred to Seller or its designee pursuant to
      this clause (c)(3), as well as any amounts received by Red Iron after the
      date of transfer from an account debtor with respect thereto shall be
      deemed held by Red Iron in trust and as fiduciary for Seller or its
      designee and Red Iron shall pay the

              

      

       

      
        
           

        

        
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                same
      over to Seller or its designee promptly upon receipt.  Red Iron
      will irrevocably instruct any account debtor with respect to such
      repurchased Non-conforming Invoice to make all payments on account thereof
      after such assignment to Seller or its designee.  Red Iron shall
      execute such documents and instruments of transfer or assignment and take
      such other actions as shall reasonably be requested by Seller or its
      designee to effect the conveyance of such Non-conforming Invoice pursuant
      to this clause (c)(3).

              

      

       

      
        	
                 
      

              	
                (4)

              	
                Seller
      and Red Iron acknowledge and agree that Red Iron’s rights under Section
      2(c) of this Agreement with regard to Non-conforming Invoices are in lieu
      of Red Iron’s rights under the provisions of Sections 3(a) and 3(b) of
      this Agreement and are not subject to the limitation set forth in Section
      4(a) of this Agreement.

              

      

       

      
        	
                 
      

              	
                (5)

              	
                Notwithstanding
      the foregoing, if Red Iron notifies Seller, as a result of its own
      determination or in response to a request from Seller, that due to changed
      circumstances any Non-conforming Invoice or any group of Non-conforming
      Invoices attributable to a single Dealer or Distributor sold to Red Iron
      pursuant to this Section 2(c) is no longer subject to any condition
      requiring that it or they be treated as Non-conforming Invoice(s) such
      that it or they would qualify for sale pursuant to either Section 2(a) or
      2(b) above, the subject Invoice(s) shall no longer be considered as
      Non-conforming Invoice(s) and Seller shall no longer be subject to the
      Recourse Obligation with respect thereto; provided, however, that such
      Invoice shall be subject to the provisions of Section 3(a), 3(b) and 4(a)
      of this Agreement.  Red Iron agrees to respond to any request
      from Seller made pursuant to the preceding sentence, which request shall
      specify with reasonable detail the basis for such request, indicating Red
      Iron’s acceptance of such request or rejection of such request and the
      reason for such rejection, in writing within five (5) business days after
      Red Iron’s receipt of such request from Seller. At such time as all
      Invoices due from any of the Dealers/Distributors listed on Schedule 1
      attached hereto are determined in accordance with the foregoing procedure
      no longer to be Non-conforming Invoices, such Schedule 1 shall be amended
      to delete reference to such Dealer/Distributor. Likewise, at such time as
      Seller requests that Red Iron accept a group of Invoices attributable to a
      single Dealer or Distributor as Non-conforming Invoices in accordance with
      the provisions of this Section 2(c), such Schedule 1 shall be amended to
      add a reference to such Dealer/Distributor. Such amendments to Schedule 1,
      and any other updates, amendments, supplements or modifications to
      Schedule 1 as may be mutually agreed upon by the parties from time to
      time, shall be in writing and initialed by an authorized representative of
      each party.

              

      

       

      
        	
                 
      

              	
                (d)

              	
                Upon
      Red Iron’s payment to Seller or an affiliate of Seller of the amount of an
      Invoice pursuant to the terms of the preceding Sections 2 (a), (b) or (c),
      Seller or its affiliate, as applicable, shall be deemed, without the
      necessity of any further

              

      

       

      
        
           

        

        
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                action,
      to have transferred, assigned, set over and otherwise conveyed to Red
      Iron, without recourse except as provided herein, all of its right to
      receive payment under or in respect of such Invoice and any related
      Wholesale Instrument, any collateral security securing payment thereof and
      any other credit support together with all monies due or to become due and
      all amounts received or receivable with respect thereto, including all
      rights to receive payments thereon from any Dealer and/or
      Distributor.  For accounting purposes, no Seller or affiliate of
      Seller, as applicable, shall account for the transactions contemplated by
      this Agreement in any manner other than, with respect to the sale of the
      right to receive payment of each Invoice, as a true sale to Red
      Iron.  Seller and its affiliates shall also maintain their
      respective records and books of account in a manner which clearly reflects
      each such sale of the right to receive payment of such Invoices to Red
      Iron.

              

      

       

      
        	
                 
      

              	
                (e)

              

      

       

      
        	
                 
      

              	
                (1)

              	
                From
      time to time, Seller and Red Iron may agree to list a Dealer or
      Distributor Dealer on Schedule 2 attached hereto (each, a “Challenged Dealer”).
      Red Iron agrees to provide Seller with monthly reports setting forth
      unpaid principal balances of Challenged Dealer Invoices due Red Iron from
      each Challenged Dealer as of the end of each month, past due status of any
      such balances and such other information as Seller may reasonably
      request.  If a Challenged Dealer shall default in the payment of
      any Challenged Dealer Invoice, after the expiration of any cure period
      applicable to such Challenged Dealer Invoice, Red Iron shall (i) attempt
      to collect from the Challenged Dealer the Inventory and amounts due under
      such Challenged Dealer Invoice through customary collection efforts deemed
      appropriate by Red Iron to the extent legally feasible and in its
      commercially reasonable discretion; (ii) attempt to cause the relevant
      Distributor to repurchase any such collected Inventory and honor any
      recourse obligation which such Distributor may have to Red Iron; and (iii)
      attempt to tender to Seller or an affiliate of Seller any such collected
      Inventory eligible under Section 3(a) or 3(b) of this
      Agreement.  Notwithstanding the foregoing, Red Iron shall not
      commence litigation in an attempt to collect amounts due under a
      Challenged Dealer Invoice pursuant to this clause (e)(1) unless (x) such
      litigation is approved by Seller or (y) Red Iron determines, in its
      reasonable judgment, that its rights would be prejudiced by any delay
      caused by the need to obtain Seller’s approval, in which case it may
      commence litigation upon notice to Seller.  Seller shall pay Red
      Iron upon demand all costs and expenses actually incurred by Red Iron in
      connection with collection efforts described in this clause (e)(1)) or to
      the extent such costs and expenses are otherwise approved in advance by
      Seller.

              

      

       

      
        	
                 
      

              	
                (2)

              	
                In
      the event any amounts remain unpaid with  respect to such
      Challenged Dealer Invoice after Red Iron has undertaken commercially
      reasonable efforts to comply with the provisions of the preceding clause
      (e)(1), upon demand by Red Iron which shall set forth in reasonable detail
      the nature of

              

      

       

      
        
           

        

        
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                such
      default, subject to the limits set forth in clause (4) below, Seller shall
      repurchase such Challenged Dealer Invoice from Red Iron for an amount
      equal to the outstanding balance (including accrued but unpaid interest
      for a period not to exceed ninety (90) days after the Invoice due date)
      remaining unpaid under such Challenged Dealer Invoice after applying any
      amounts received by Red Iron pursuant to the actions described in clause
      (e)(1) (such repurchase obligation being referred to herein as the “Challenged Dealer Recourse
      Obligation”). The Challenged Dealer Recourse Obligation shall be
      paid to Red Iron in immediately available funds not later than five (5)
      business days after Seller’s receipt from Red Iron of demand for the
      repurchase of such Challenged Dealer Invoice, which payment shall be
      considered payment in full of such Challenged Dealer
    Invoice.

              

      

       

      
        	
                 
      

              	
                (3)

              	
                Upon
      the payment required to be made to Red Iron as provided in clause (e)(2),
      Red Iron shall automatically and without further action be deemed to
      transfer, assign, set over and otherwise convey to Seller or its designee,
      without recourse, representation or warranty, except as set forth in the
      immediately following sentence, all the right, title and interest of Red
      Iron in and to the applicable Challenged Dealer Invoice and any related
      Wholesale Instrument, all moneys due or to become due and all collateral
      security, if any, with respect thereto and all amounts received with
      respect thereto and all proceeds thereof.  Such transfer shall
      be free and clear of any liens created by or through Red
      Iron.  Any collections received by Red Iron after the date of
      transfer with respect to any Challenged Dealer Invoices transferred to
      Seller or its designee pursuant to this clause (e)(3) as well as any
      amounts received by Red Iron after the date of transfer from an account
      debtor with respect thereto shall be deemed held by Red Iron in trust and
      as fiduciary for Seller or its designee and Red Iron shall pay the same
      over to Seller or its designee promptly upon receipt.  Red Iron
      will irrevocably instruct any account debtor with respect to such
      purchased Challenged Dealer Invoice to make all payments on account
      thereof after such assignment to Seller or its designee.  Red
      Iron shall execute such documents and instruments of transfer or
      assignment and take such other actions as shall reasonably be requested by
      Seller or its designee to effect the conveyance of such Challenged Dealer
      Invoice pursuant to this clause
(e)(3).

              

      

       

      
        	
                 
      

              	
                (4)

              	
                Notwithstanding
      the foregoing, neither Seller nor any affiliate of Seller shall have any
      obligation to purchase a Challenged Dealer Invoice during any calendar
      year under the terms of this Agreement if any of the following are
      applicable:

              

      

       

      
        	
                 
      

              	
                (i)

              	
                the
      aggregate amount of Challenged Dealer Recourse
      Obligations  fully and finally paid hereunder to Red Iron with
      respect to Challenged Dealer Invoices in such calendar year equals or
      exceeds One Million Dollars
($1,000,000);

              

      

       

      
        
           

        

        
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                (ii)

              	
                the
      aggregate amount of Challenged Dealer Recourse Obligations fully and
      finally paid hereunder to Red Iron exceeds (A) during 2010, the greater of
      $100,000 or ten percent (10%) of Average
      Receivables for the period to date in 2010 or (B) during 2011, ten percent
      (10%) of
      Average Receivables for the period to date in 2011 or (C) in 2012 and
      thereafter, ten percent (10%) of Average
      Receivables for the most recently completed twelve month period;
      or

              

      

       

      
        	
                 
      

              	
                (iii)

              	
                with
      respect to a particular Challenged Dealer, to the extent the Challenged
      Dealer Recourse Obligations fully and finally paid hereunder would exceed
      110% of the credit line reflected on Schedule 2 for such Challenged Dealer
      (as in effect at the time of such
purchase).

              

      

       

      Seller
acknowledges that as additional Challenged Dealer Invoices are purchased by Red
Iron during the course of a calendar year, Seller may be obligated to honor the
purchase obligations with respect to Challenged Dealer Invoices that were exempt
from such purchase obligation in prior months as a result of the application of
clause (ii) of the preceding sentence and agrees to do so promptly upon demand
by Red Iron following the close of any calendar month in which such purchase
obligation arises.  Beginning December 31, 2010, Red Iron shall,
within forty-five (45) days following each December 31 and the expiration date
of this Agreement, calculate Average Receivables for the calendar year then
ending (or the period ending on such expiration date).  Red Iron will
thereafter promptly remit to Seller the amount, if any, by which the Challenged
Dealer Recourse Obligations fully and finally paid by Seller hereunder with
respect to such immediately preceding calendar year (or the current calendar
year period ending on the expiration date) exceeded ten percent (10%) of Average
Receivables for such period.

       

      
        	
                 
      

              	
                (5)

              	
                Seller
      and Red Iron acknowledge and agree that Red Iron’s rights under Section
      2(e) of this Agreement with regard to Challenged Dealer Invoices are in
      addition to Red Iron’s rights under the provisions of Sections 3(a) and
      3(b) of this Agreement (provided, however, that upon the payment in full
      of any Challenged Dealer Recourse Obligations with respect to any
      Challenged Dealer Invoice, Red Iron shall thereafter not be entitled to
      exercise its rights under Sections 3(a) and 3(b) with respect to such
      Challenged Dealer Invoice and any related Inventory) and are not subject
      to the limitation set forth in Section 4(a) of this
    Agreement.

              

      

       

      
        	
                 
      

              	
                (6)

              	
                Notwithstanding
      the foregoing, if Red Iron notifies Seller, as a result of its own
      determination or in response to a request from Seller, that due to changed
      circumstances any Challenged Dealer is no longer subject to any condition
      requiring that it be treated as a Challenged Dealer, including, but not
      limited to, a determination that a Challenged Dealer has
      become

              

      

       

      
        
           

        

        
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                eligible
      for floorplan inventory financing in accordance with the credit and
      operational policies of Red Iron, any Invoices of such former Challenged
      Dealer shall no longer qualify for the provisions of this Section 2(e) and
      Seller shall no longer be subject to the Challenged Dealer Recourse
      Obligation with respect thereto; provided, however, that such Invoices
      shall be subject to the provisions of Sections 3(a), 3(b) and 4(a) of this
      Agreement.  Red Iron agrees to respond to any request from
      Seller made pursuant to the preceding sentence, which request shall
      specify with reasonable detail the basis for such request, indicating Red
      Iron’s acceptance of such request or rejection of such request and the
      reason for such rejection, in writing within ten (10) business days after
      Red Iron’s receipt of such request from Seller. At such time Schedule 2
      shall be amended to delete reference to such former Challenged Dealer.
      Likewise, at such time as Seller and Red Iron determine that future
      Invoices related to any other Dealer or Distributor Dealer are to be
      subject to the provisions of this Section 2(e), such Schedule 2 shall be
      amended to add a reference to such Dealer or Distributor Dealer such that
      any Challenged Dealer Invoices acquired by Red Iron with respect to such
      Dealer or Distributor Dealer after the date of such amendment will be
      subject to the provisions of this Section 4(e).  Such amendments
      to Schedule 2, and any other updates, amendments, supplements or
      modifications to Schedule 2 as may be mutually agreed upon by the parties
      from time to time, shall be in writing and initialed by an authorized
      representative of each party.  Seller and Red Iron anticipate
      that Schedule 2 may be updated on at least a monthly basis throughout the
      term of this Agreement.

              

      

       

      
        	
                 
      

              	
                (f)

              	
                Seller
      (on behalf of itself and its affiliates) hereby grants to Red Iron a
      limited power of attorney for the sole purpose of endorsing checks, drafts
      and other instruments received by Red Iron payable to the order of Seller
      and its affiliates and relating, in whole or in part, to receivables held
      by Red Iron.

              

      

       

      
        	
                3.

              	
                Repurchase of
      Inventory; Extended Service Contract
  Recourse.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                Seller’s Repurchase of
      Inventory Sold by Seller or its Affiliates Directly to a Dealer or
      Distributor. Subject to Section 4, if Red Iron shall repossess or
      come into possession of any Inventory, or any part thereof, covered by any
      Dealer Invoice or Distributor Invoice, Seller agrees to repurchase such
      Inventory from Red Iron in a condition that is new and unused, subject to
      normal wear and tear resulting from display or demonstration, and wherever
      located. Seller shall pay Red Iron, within thirty (30) days of request
      therefor and in good funds, the outstanding balance (including accrued but
      unpaid interest) remaining unpaid under such Invoice. In addition, Seller
      shall pay Red Iron for all costs and expenses actually incurred by Red
      Iron in taking possession or in the repossession of such Inventory,
      including shipping and storage costs (not to exceed 10% of the original
      Invoice) plus reasonable attorneys’ fees and court costs actually
      incurred. Seller shall not assert any interest in or title to such
      Inventory until it has paid Red Iron all amounts as specified herein in
      full.

              

      

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                (b)

              	
                Seller’s Repurchase of
      Inventory Sold by a Distributor to a Dealer. Subject to Section 4,
      if Red Iron shall repossess or come into possession of any Inventory, or
      any part thereof, covered by any Distributor to Dealer Invoice, and
      Distributor fails to repurchase such Inventory from Red Iron within thirty
      (30) days of Red Iron’s demand therefor, Seller agrees to repurchase such
      Inventory from Red Iron in a condition that is new and unused, subject to
      normal wear and tear resulting from display or demonstration, and wherever
      located. Subject to Section 3(h), Seller shall pay Red Iron, within thirty
      (30) days of request therefor and in good funds, the outstanding balance
      (including accrued but unpaid interest) amount remaining unpaid under such
      Distributor to Dealer Invoice. In addition, Seller shall pay Red Iron for
      all costs and expenses actually incurred by Red Iron in taking possession
      or in the repossession of such Inventory, including shipping and storage
      costs (not to exceed 10% of the original Invoice) plus reasonable
      attorneys’ fees and court costs actually incurred. Seller shall not assert
      any interest in or title to such Inventory until it has paid Red Iron all
      amounts as specified herein in
full.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                Seller
      and Red Iron agree that the repurchase of Inventory hereunder shall not be
      deemed to be a transfer subject to Sections 9-615(f) or 9-618 of the
      Illinois Uniform Commercial Code or any similar provision of any other
      applicable law.

              

      

       

      
        	
                 
      

              	
                (d)

              	
                If
      an Invoice delivered to Red Iron by Seller does not identify the covered
      Inventory by serial number, but only by model number, and Seller cannot
      prove to Red Iron’s reasonable satisfaction that an item of Inventory is
      covered by a particular Invoice, then for purposes of determining the age
      or price of an item of Inventory under this Agreement, the item of
      Inventory shall be deemed to be covered by the most recent Invoice which
      has an item with the same model number as the item of Inventory tendered
      for repurchase.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                Seller
      further agrees that in the event Red Iron refinances Inventory pursuant to
      a buyout of debt from another financing source or otherwise, such
      Inventory will be subject to repurchase by Seller under this Section 3,
      notwithstanding the fact that Red Iron did not finance the initial
      purchase of such Inventory from
Seller.

              

      

       

      
        	
                 
      

              	
                (f)

              	
                Seller
      agrees (and Seller will cause its affiliates, as applicable) to execute
      any additional agreements, instruments, and documents which Red Iron may
      reasonably require to maintain Red Iron’s rights and interests in any
      Inventory.

              

      

       

      
        	
                 
      

              	
                (g)

              	
                To
      the extent reasonably feasible, and without prejudicing Red Iron’s rights,
      Red Iron shall provide Seller prior written notice of Red Iron’s intent to
      commence litigation against a Dealer or
  Distributor.

              

      

       

      
        	
                 
      

              	
                (h)

              	
                Red
      Iron shall provide Seller contemporaneous written notice of any action by
      Red Iron against a Dealer or Distributor with respect to any amounts
      unpaid under a Distributor to Dealer Invoice.  Red Iron shall
      not make a demand on Seller to perform its obligations under Section 3(b)
      above until at least ten (10) days after providing such notice to Seller
      or, in the case where the Dealer or
Distributor

              

      

       

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                disputes
      such amounts in good faith, until at least thirty (30) days after
      providing such notice to Seller.

              

      

       

      
        	
                 
      

              	
                (i)

              	
                If
      an Invoice for an extended service contract is not paid when due, then Red
      Iron shall have the benefit of recourse to Seller with respect to such
      Invoice on such terms as Red Iron and Seller shall mutually agree from
      time to time.

              

      

       

      
        	
                4.

              	
                Net Repurchase Limit;
      Remarketing.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                Neither
      Seller nor any affiliate of Seller shall have any obligation under Section
      3 of this Agreement, Section 3 of that certain Repurchase Agreement dated
      November 25, 2009 (“Canada Repurchase
      Agreement”) by and between Seller and TCF Commercial Finance
      Canada, Inc., a Canadian Federal corporation (“TCFCFC”), or under
      similar provisions of any other repurchase agreement entered into by and
      between Seller or an affiliate of Seller, on the one hand, and Red Iron on
      the other, to repurchase any additional Inventory in a calendar year once
      the aggregate amount of repurchase obligations fully and finally paid
      hereunder to Red Iron during such calendar year, together with the
      aggregate amount of any repurchase obligations fully and finally paid by
      Seller or any affiliate of Seller to TCFCFC under Section 3 of the Canada
      Repurchase Agreement, equals or exceeds the Net Repurchase Limit for such
      calendar year.  “Net Repurchase Limit”
      shall mean Seven and One-Half Million Dollars ($7,500,000) for each
      calendar year during the term of this Agreement.  The foregoing
      Net Repurchase Limit shall not relieve Seller or its affiliates from (i)
      any obligation to repurchase or otherwise acquire any Inventory pursuant
      to any separate agreement between Seller or an affiliate of Seller and any
      Distributor or (ii) any other recourse obligation Seller or an affiliate
      of Seller may have to Red Iron (including the recourse described in
      Sections 2(c), 2(e) and 3(i) hereof).  The value in United
      States Dollars of Inventory repurchased pursuant to Section 4(a) of the
      Canadian Repurchase Agreement shall be determined using the Canada dollar
      exchange rate printed in the Wall Street Journal on the effective date of
      the applicable repurchase
transaction.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                Once
      the Net Repurchase Limit has been reached in a calendar year, Seller
      agrees to use its best efforts to remarket any additional repossessed
      Inventory on behalf of Red Iron on a non-discriminatory, non-priority
      basis for an amount not less than the outstanding balance (including
      accrued but unpaid interest) remaining due Red Iron on such
      Inventory.  As used herein, such best efforts shall include
      advertising and using the same methods to market such Inventory as Seller
      uses to market similar products in the course of conducting its own
      business, subject to Red Iron’s rights to approve all aspects of any
      resale of such Inventory.  Red Iron acknowledges that Seller in
      the ordinary course of its business will be engaged in the marketing of
      other similar Inventory and that such activity shall not constitute a
      breach of any duty of Seller under the terms of this Section 4(b) so long
      as Seller complies with the two immediately preceding
      sentences.  Red Iron will reimburse Seller for reasonable
      out-of-pocket, third party expenses,
including

              

      

       

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                reasonable
      commissions (if any), incurred by Seller in providing remarketing services
      pursuant to this Section 4(b).

              

      

       

      
        	
                5.

              	
                Seller Representations
      and Warranties.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                Seller
      represents and warrants, at the time of any Red Iron Approval and/or
      advance against any Invoice as provided hereunder, that: (i) each and
      every Invoice issued by Seller or its affiliate, as applicable, represents
      valid obligations of a Dealer and/or Distributor, is legally enforceable
      according to its terms and relates to bona fide, original acquisition
      sales of Inventory by Seller or its affiliate, as applicable, to a Dealer
      and/or Distributor without any claim, offset or defense to payment by
      Dealer and/or Distributor and that Dealer and/or Distributor requested
      that the acquisition of Inventory be financed by Red Iron; (ii) Seller’s
      (or, as applicable, its affiliate’s) title to all Inventory is free and
      clear of all security interests, liens and encumbrances when transferred
      to Dealer and/or Distributor and Seller or its affiliate, as applicable,
      transfers to Dealer and/or Distributor all its right, title and interest
      in and to the Inventory; (iii) the Inventory is in new and unused
      condition; it is of the kind, quality and condition represented or
      warranted to Dealer and/or Distributor; it meets or exceeds all applicable
      federal, state and local safety, manufacturing and other standards; and if
      it is a type of Inventory customarily crated or boxed, such crate or box
      is factory sealed.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                In
      the event of breach of any of the foregoing representations or warranties,
      Seller will, immediately upon demand, purchase from Red Iron the Wholesale
      Instrument relating to the Invoice or Inventory with respect to which the
      representation/warranty was breached and pay, in good immediately
      available funds, the unpaid balance amount of the Wholesale Instrument,
      plus all charges owing by Dealer and/or Distributor with respect thereto,
      and all of Red Iron’s costs and expenses, including reasonable attorneys’
      fees, actually incurred in connection with such
  breach.

              

      

       

      
        	
                6.

              	
                Seller Covenants and
      Indemnity.  Seller covenants as
  follows:

              

      

       

      
        	
                 
      

              	
                (a)

              	
                All
      Inventory financed by Red Iron shall be subject to applicable product
      warranties of Seller (or its affiliate, as applicable), and Seller agrees
      to perform, or cause to be performed, all repairs, modifications and/or
      other acts required of Seller or its affiliate, as applicable, pursuant to
      said product warranties. All expenses of performance under this covenant
      shall be paid by Seller.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                If
      Seller or its affiliate, as applicable, accepts the return from any Dealer
      and/or Distributor of any Inventory covered by any Wholesale Instrument,
      voluntarily or otherwise, whether or not any substitution is made for such
      returned Inventory, Seller will reimburse Red Iron for the unpaid balance
      amount of the Wholesale Instrument within thirty (30) days of the
      return.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                At
      any time at which Seller is not required to file reports with the U.S.
      Securities Exchange Commission pursuant to Section 13 or Section 15(d) of
      the Securities

              

      

       

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                Exchange
      Act of 1934, as amended, Seller will, upon request, promptly provide Red
      Iron with Seller’s year-end balance sheet and annual profit and loss
      statement for each fiscal year prepared in accordance with generally
      accepted accounting principles, consistently
  applied.

              

      

       

      
        	
                 
      

              	
                (d)

              	
                All
      transactions of Seller and its affiliates related to the sale of Inventory
      financed by Red Iron shall comply with all applicable laws, rules,
      regulations and orders of all governmental entities having jurisdiction
      over such transactions.  Seller agrees to indemnify and hold Red
      Iron harmless from and against any and all claims, damages, costs,
      expenses, penalties and judgments asserted or imposed upon, or incurred
      by, Red Iron as a result of breach by Seller or its affiliates of any
      provision of this Section 6.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                Seller
      will notify Red Iron promptly (i) if Seller or its affiliate, as
      applicable, terminates, or gives notice of its intent to terminate, its
      agreement with any Distributor or (ii) if any Distributor terminates, or
      gives notice of its intent to terminate, its agreement with Seller or one
      of its affiliates.

              

      

       

      
        	
                7.

              	
                Waivers.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                Seller
      (on behalf of itself and its affiliates) waives: notice of non-payment;
      protest and dishonor and notice of protest and dishonor of any Wholesale
      Instrument; notice of Red Iron’s acceptance of this Agreement; and all
      other notices to which Seller or its affiliates might otherwise be
      entitled to by law. Red Iron may, at any time or times, without notice to
      or further consent of Seller or its affiliates, renew and extend the time
      of payment of Wholesale Instruments and compromise or adjust claims on
      Wholesale Instruments or Inventory covered thereby and waive or modify
      performance of such terms and conditions of its financing arrangement with
      Dealers and/or Distributors, as Red Iron may determine to be reasonable,
      and no such renewal, extension, compromise, adjustment, waiver or
      modification shall affect the obligations or liabilities of Seller
      hereunder.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                No
      waiver of any provision of this Agreement shall be implied, and no waiver
      shall be valid, unless it is in writing and signed by the person or party
      to be charged.  No waiver of any breach of any of the terms,
      provisions or conditions of this Agreement shall be construed as or held
      to be a waiver of any other breach, or a waiver of, acquiescence in, or
      consent to, any further or succeeding breach
  hereof.

              

      

       

      
        	
                8.

              	
                Term and
      Termination.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                Initial
      Term.  The initial term of this Agreement shall commence
      on the Effective Date and, provided this Agreement is not terminated
      earlier as otherwise provided herein, shall continue until October 31,
      2014 (the “Initial
      Term”) and thereafter shall be extended automatically for
      additional two-year terms (each, an “Additional Term”)
      unless at least one year prior to the expiration of the Initial Term or
      Additional Term (as applicable) either party gives notice to the
      other

              

      

       

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                party
      of its intention not to extend the term, in which event the Agreement
      shall terminate at the end of the then current Initial Term or Additional
      Term.  Notwithstanding the foregoing, this Agreement shall
      automatically terminate upon the final dissolution, winding up and
      liquidation of Red Iron.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                Default
      Termination.  If Seller (or, as applicable, one of its
      affiliates) is in default of any of the provisions of this Agreement and
      Seller shall fail to cure (or cause the cure of) such default within
      thirty (30) days after notice by Red Iron of such default (or such longer
      period of time as is reasonably necessary to allow Seller to cure (or
      cause the cure of) such default but, in any event, not more than
      seventy-five (75) days after notice by Red Iron of such default), Red Iron
      shall then have the right to terminate this Agreement without further
      notice and without penalty and the right to exercise all remedies
      available to Red Iron under applicable
law.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                Effect of
      Termination.  The termination of all or any part of this
      Agreement shall not affect the obligations of Seller or its affiliates
      with respect to Invoices approved or advanced against by Red Iron, or
      other obligations incurred by either party, prior to the effective date of
      such termination.

              

      

       

      
        	
                9.

              	
                General.

              

      

       

      
        	
                 
      

              	
                (a)

              	
                This
      Agreement has been duly authorized and executed by Seller and Red Iron and
      shall be binding upon and inure to the benefit of the parties hereto and
      their respective successors and/or assigns, subject to the limitations of
      this Section 9(a). Neither party may assign this Agreement without the
      prior written consent of the other (which consent shall not be
      unreasonably withheld), unless such assignment is to a
      successor-in-interest to the assigning
party.

              

      

       

      
        	
                 
      

              	
                (b)

              	
                This
      Agreement constitutes the entire agreement between the parties and
      contains all of the agreements between the parties with respect to the
      subject matter hereof.  This Agreement supersedes any and all
      other agreements, either oral or written, between the parties hereto with
      respect to the subject matter hereof.  No amendment or
      modification of this Agreement shall be valid unless the same shall be in
      writing and signed by the parties hereto.  Notwithstanding the
      foregoing, the parties acknowledge that there may be other agreements
      between them from time to time covering related matters such as financing
      program terms, Seller sponsored rate programs or electronic invoice
      transmission which shall continue in full force and effect. This Agreement
      shall not be deemed to create, or intend, a joint venture, partnership,
      agency or other similar relationship between Seller and Red
      Iron.

              

      

       

      
        	
                 
      

              	
                (c)

              	
                Notices
      and all other communication provided for herein shall be in writing and
      shall be deemed to have been given to a party at the earlier of (i) when
      personally delivered, (ii) 72 hours after having been deposited into the
      custody of the U.S. Postal Service, sent by first class certified mail,
      postage prepaid, (iii) one business day after deposit with a national
      overnight courier service, (iv) upon receipt of
  a

              

      

       

      
        
           

        

        
          14

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                confirmation
      of facsimile transmission or (v) upon receipt of electronic mail (with a
      notice contemporaneously given by another method specified in this Section
      9(c)); in each case addressed as
follows:

              

      

       

      If to Red
Iron:                   Red
Iron Acceptance, LLC

      8111
Lyndale Avenue South

      Bloomington,
MN 55420

      Attention:
General Manager

      Telephone:
(952) 887-8266

      Facsimile:
(952) 887-8258

      Email:  tevans@tcfif.com

       

      If to
Seller:                         The
Toro Company

      8111
Lyndale Avenue South

      Bloomington,
MN 55420

      Attention:
Treasurer

      Telephone:
952-887-8449

      Facsimile:
952-887-8920

      Email:
Tom.Larson@toro.com

       

      or to
such other address as either party hereto may have furnished to the other party
hereto in writing in accordance herewith, expect that notices of change of
address shall be effective only upon receipt.

       

      
        	
                 
      

              	
                (d)

              	
                This
      Agreement shall be subject to and governed by the laws of the state of
      Illinois, without regard to conflicts of law
  principles.

              

      

       

      
        	
                 
      

              	
                (e)

              	
                The
      respective acts and obligations of the parties under this Agreement shall
      be performed solely by said parties; provided, however, if any act or
      obligation hereunder is performed by any party’s subsidiary, affiliate or
      agent, then such performance shall be deemed to be the act or obligation
      of Seller or Red Iron, as
applicable.

              

      

       

      
        	
                 
      

              	
                (f)

              	
                Seller
      agrees to pay all reasonable out of pocket costs and expenses, including
      attorneys’ fees, actually incurred by Red Iron in enforcing any of the
      provisions of this Agreement.

              

      

       

      
        	
                 
      

              	
                (g)

              	
                EACH
      OF SELLER AND RED IRON, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
      HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY
      JURY AS TO ANY ISSUE RELATING TO THIS AGREEMENT IN ANY ACTION, PROCEEDING,
      OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
      TRANSACTIONS CONTEMPLATED HEREBY.  THIS WAIVER IS A MATERIAL
      INDUCEMENT FOR OUR ENTERING INTO THIS
AGREEMENT.

              

      

       

      
        	
                 
      

              	
                (h)

              	
                Each
      of Seller and Red Iron hereby irrevocably submits to the non-exclusive
      jurisdiction of the Federal courts and the courts of the state of
      Minnesota sitting in

              

      

       

      
        
           

        

        
          15

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                Minneapolis
      or St. Paul, Minnesota or any state court located in Hennepin County,
      Minnesota, and by execution and delivery of this Agreement, each party
      hereto accepts for itself and in connection with its properties, generally
      and unconditionally, the non-exclusive jurisdiction of such courts with
      respect to any litigation concerning this Agreement or the transactions
      contemplated hereby or any matters related thereto.  Each party
      hereto irrevocably waives any objection (including any objection to the
      laying of venue or any objection on the grounds of forum non conveniens)
      which it may now or hereafter have to the bringing of any proceeding with
      respect to this Agreement to the courts set forth above.  Each
      party hereto agrees to the personal jurisdiction of such courts and that
      service of process may be made on it at the address indicated in Section
      9(c) above.  Nothing herein shall affect the right to serve
      process in any other manner permitted by
law.

              

      

       

      
        	
                 
      

              	
                (i)

              	
                NO
      PARTY TO THIS AGREEMENT SHALL BE RESPONSIBLE OR LIABLE TO ANY OTHER PARTY
      TO THIS AGREEMENT, ANY SUCCESSOR, ASSIGNEE OR THIRD PARTY BENEFICIARY OF
      SUCH PERSON OR ANY OTHER PERSON ASSERTING CLAIMS DERIVATIVELY THROUGH SUCH
      PARTY, FOR PUNITIVE, EXEMPLARY OR, EXCEPT IN THE CASE OF FRAUD, BAD FAITH,
      WILLFUL MISCONDUCT OR GROSS NEGLIGENCE, INDIRECT OR CONSEQUENTIAL DAMAGES
      THAT MAY BE ALLEGED AS A RESULT OF ANY TRANSACTION CONTEMPLATED
      HEREUNDER.

              

      

       

      
        	
                 
      

              	
                (j)

              	
                If
      any portion or portions of this Agreement shall be, for any reason,
      invalid or unenforceable, the remaining portion or portions shall
      nevertheless be valid, enforceable and carried into effect, unless to do
      so would clearly violate the present legal and valid intention of the
      parties hereto.

              

      

       

      
        	
                 
      

              	
                (k)

              	
                This
      Agreement may be executed in one or more counterparts, each of which shall
      be deemed an original, but all of which together shall constitute one and
      the same agreement.  This Agreement may be executed by facsimile
      signature or electronic transmission, as directed by Red
    Iron.

              

      

       

      
        	
                 
      

              	
                (l)

              	
                The
      headings in this Agreement are inserted for convenience only and are not
      to be considered in the interpretation or construction of the provisions
      hereof.  Unless the context of this Agreement otherwise clearly
      requires, the following rules of construction shall apply to this
      Agreement: (i) the words “hereof,” “herein” and “hereunder” and words of
      similar import shall refer to this Agreement as a whole and not to any
      particular provision of this Agreement; (b) the words “include” and
      “including” and words of similar import shall not be construed to be
      limiting or exclusive and (c) the word “or” shall have the meaning
      represented by the phrase “and/or.”

              

      

       

      [SIGNATURE
PAGE FOLLOWS]

       

      
        
           

        

        
          16

          
            

          

        

        
           

        

      

      IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed as of the
Effective Date.

      
 

      
        
          	
                  The
      Toro Company

                	 
      	
                  Red
      Iron Acceptance, LLC

                
	
                  Seller

                	 
      
	 
      	 
      
	
                  By:

                	
                  /s/
      T. J. Larson

                	 
      	
                  By:

                	
                  /s/
      Tom Evans

                
	
                  Print
      Name:

                	
                  Thomas
      J. Larson

                	
                  Print
      Name:

                	
                  Tom
      Evans

                
	
                  Title:

                	
                  Vice
      President, Treasurer

                	
                  Title:

                	
                  General
      Manager

                
	
                  Tax
      ID No.:

                	
                  41-0580470

                	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      
	 
      	 
      	 
      	 
      	 
      

        

      
        
           

        

        
          17ex41.htm

    EXHIBIT
4.1

    

    Specimen
of Common Stock Certificate.

    

    [FRONT]

    

    
      	
              COMMON
      STOCK

            	
              [LOGO]

            	
              SUN  HEALTHCARE

            	
              COMMON
      STOCK

            
	
              NUMBER

            	 
      	
              Caring
      is the Key in Life

            	
              SHARES

            
	
              CS

            	 
      	 
      
	
              $.01
      PAR VALUE

            	
              INCORPORATED
      UNDER THE LAWS OF THE STATE OF DELAWARE

            	
              $.01
      PAR VALUE

            

    

    

    CUSIP
866933 40 1

    

    SEE
REVERSE

    FOR
CERTAIN

    DEFINITIONS

    

    THIS
CERTIFIES THAT

    

    IS THE
OWNER OF

    

    FULLY
PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK OF

    

    Sun
Healthcare Group, Inc. transferable on the books of the Corporation by the
holder hereof in person or by duly authorized attorney upon surrender of this
Certificate properly endorsed. This Certificate and the shares represented
hereby are issued and shall be subject to all the provisions of the Certificate
of Incorporation and Bylaws of the Corporation and the amendments from time to
time made thereto, copies of which are on file with the Transfer Agent, to all
of which the holder of this Certificate by acceptance hereof assents. This
Certificate is not valid until countersigned and registered by the Transfer
Agent and Registrar.

    

    Witness,
the facsimile seal of the Corporation and the facsimile signatures of its duly
authorized officers.

    

    Dated:

    

    
      	 
      	
              Sun
      Healthcare Group Inc.

            	 
      
	
              /s/
      Michael Berg

            	
              SEAL

            	
              /s/
      Richard K. Matros

            
	
              Secretary

            	
              DELAWARE

            	
              Chairman
      of the Board

            

    

    

    COUNTER
SIGNED AND REGISTERED:

    AMERICAN
STOCK TRANSFER & TRUST COMPANY, LLC.

    BY         TRANSFER
AGENT AND REGISTRAR

    

    

    AUTHORIZED
SIGNATURE

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    [BACK]

    

    SUN
HEALTHCARE GROUP, INC.

    

    THE
CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS, THE
POWERS, DESIGNATIONS, PREFERENCES, AND RELATIVE, PARTICIPATING, OPTIONAL OR
OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF OF THE
CORPORATION, AND THE QUALIFICATIONS, LIMITATIONS, OR RESTRICTIONS OF SUCH
PREFERENCES AND/OR RIGHTS.

    

              The
following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

    

    
      	
              TEN
      COM

            	
              -
      as tenants in common

            	
              UNIF
      GIFT MIN ACT

            	
              -             Custodian             

                  (Cust)                    (Minor)

              under
      Uniform Gifts to Minors

                    Act                           

                   
                    (State)

               

            
	
              TEN
      ENT

            	
              -
      as tenants by the entireties

            	 
      
	
              JT
      TEN

            	
              -
      as joint tenants with right of survivorship
and not as tenants in
      common

            	 
      
	
              TOD

            	
              -
      transfer on death direction in event of 
owner's death, to person named
      on face and
subject to TOD
      referenced

            	 
      
	 
      	 
      	 
      

    

    

    Additional
abbreviations may also be used though not in the above list.

    

              For
value received,                                                        
hereby sell, assign and transfer unto

    

    PLEASE
INSERT SOCIAL SECURITY OR OTHER

        IDENTIFYING
NUMBER OF ASIGNEE

                                                                              

    

                                                                                                                                                                                              

                    Please
print or typewrite name and address including postal zip code of
assignee

                                                                                                                                                                                              

    

                                                                                                                                                                                          

    

                                                                                                                                                                                
Shares

    of Common
Stock represented by the within Certificate, and do hereby irrevocably
constitute and appoint

    

                                                                                                                                                                                             

    Attorney
to transfer the said stock on the books of the within-named Corporation with
full power of substitution in the premises.

    

              Dated,
                                             

    

    
      	 
      	
              x                                                                                       

            
	
              NOTICE:  THE
      SIGNATURES(S) TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME(S) AS
      WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT
      ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER

            	 
      	 
      
	
              x                                                                                       

            
	 
      
	
                                                                                                       

            
	
              THE
      SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION
      (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH
      MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT
      TO S.E.C. RULE 17Ad-15.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00169-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00169-of-00352.parquet"}]]