RESOLUTION:
1. Close all Toad sessions
2. Go to the following paths depending on your Windows OS
Windows Vista, 7, 2008 - C:Users\<user>\AppData\Roaming\Quest Software\Toad for Oracle\<version>\User Files
Windows X - PC:\Documents and Settings\<user>\Application Data\Quest Software\Toad for Oracle\<version>\User Files
3. Rename the Toad.ini to Toad.ini_OLD
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