Form 4: Toro VP Acquires Performance Share Units

Toro Company's VP of Technology, Kurt D. Svendsen, acquired 421 performance share units as part of a compensation plan tied to fiscal 2025 results.

Summary

• Kurt D. Svendsen, VP, Technology at The Toro Co (TTC), acquired 421 performance share units on December 17, 2025.
• This acquisition represents the payout of a Performance Share Award for the Fiscal 2023 to Fiscal 2025 Performance Period under The Toro Company 2022 Equity and Incentive Plan.
• The award was approved by the Compensation & Human Resources Committee on December 9, 2025, and was contingent on the company's Fiscal 2025 financial results, which were released on December 17, 2025.
• Svendsen deferred the payout into performance share units under The Toro Company Deferred Compensation Plan for Officers.
• The reporting person also acquired 59.209 performance share units, 117.280 shares of common stock, and 114.511 net shares of common stock through dividend reinvestment features across various plans.
• Following these transactions, Svendsen beneficially owns 6,353.64 performance share units directly, 11,763.317 shares of common stock directly, 11,479.94 shares of common stock indirectly via The Toro Company Retirement Plan, and 473.887 restricted stock units directly.
• The restricted stock units, granted on March 1, 2023, vest in three equal annual installments starting on the first anniversary of the grant date.

Sentiment

Score: 7

Explanation: The acquisition of performance share units by a key executive, resulting from the achievement of performance targets over a multi-year period, suggests positive internal assessment of company performance and aligns executive interests with shareholders.

Positives

• A senior executive, Kurt D. Svendsen, acquired 421 performance share units, indicating alignment of management incentives with company performance.
• The performance share award payout suggests that the company met or exceeded performance targets for the Fiscal 2023-2025 period.
• Additional shares and units were acquired through dividend reinvestment plans, reflecting continued investment by the executive.

Future Outlook

The filing indicates that the performance share award was contingent upon Fiscal 2025 financial results, implying that the company met its performance targets for that period. The vesting schedule for restricted stock units extends into future years, aligning executive incentives with long-term company performance.

Management Comments

• Represents the payout of a Performance Share Award for the Fiscal 2023 to Fiscal 2025 Performance Period under The Toro Company 2022 Equity and Incentive Plan, as approved by the Issuer's Compensation & Human Resources Committee of its Board of Directors on December 9, 2025, and which was conditioned upon and subject to confirmation by the Issuer's Fiscal 2025 financial results that were released on December 17, 2025.
• The reporting person has deferred the payout of his Performance Share Award under The Toro Company Deferred Compensation Plan for Officers (the 'Deferred Plan'), and accordingly, the reporting person's Performance Share Award is paid in performance share units under the Deferred Plan.

Industry Context

This Form 4 reflects standard executive compensation practices within publicly traded companies, where performance-based equity awards are used to incentivize management and align their interests with shareholders. The acquisition of shares through dividend reinvestment is also a common practice.

Comparison to Industry Standards

• The use of performance share units and restricted stock units as part of executive compensation is a common industry practice, aligning executive incentives with long-term shareholder value creation.
• The deferral of performance share awards into a deferred compensation plan is a standard option offered to executives for tax planning and wealth management.
• Dividend reinvestment features are typical for employee stock plans and retirement accounts, allowing for compounding of equity holdings.

Stakeholder Impact

• Shareholders: The payout of performance share awards to an executive, contingent on financial results, suggests that the company met its performance objectives, which is generally positive for shareholders. The executive's increased equity stake aligns their interests with shareholder value.
• Employees: The existence of equity and incentive plans indicates a structured approach to employee compensation and motivation, potentially fostering a performance-driven culture.

Next Steps

• The restricted stock units will vest in three equal annual installments commencing on March 1, 2024 (first anniversary of March 1, 2023 grant date).

Key Dates

Recommendation

The acquisition of performance share units by a VP, tied to the achievement of fiscal performance targets, is a positive signal indicating management confidence and alignment with shareholder interests. However, this single insider transaction, while favorable, is not sufficient on its own to warrant a 'buy' or 'strong buy' recommendation without a broader analysis of the company's financial health, market position, and future prospects. It reinforces a 'hold' position for existing investors and suggests a positive indicator for those considering the stock.

Keywords

Toro Company, TTC, SEC Form 4, Insider Trading, Performance Share Units, Executive Compensation, Stock Acquisition, Dividend Reinvestment, Restricted Stock Units