Every project in Eclipse can have various "natures". In general, natures should extend project features. Toad Extension for Eclipse nature also adds various features to existing projects - incl. Java projects or any other type of project.
You can add Toad Extension Nature to your existing project in various ways
Adding Toad Extension Nature also adds sql folder automatically in the project. The folder is similar to SRC folder that exists in any Java project. As you may suppose, files in SQL folder will contain code for your database objects. Each object should be represented by one file.
It is possible to choose Default connection for projects with Toad Extension Nature.
Default connection allows you to quickly deploy functions, stored procedures and other SQL scripts to your database.
For more information, see the topic Deployment.