10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended April 1, 2012

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number 1-9183

Harley-Davidson, Inc.

(Exact name of registrant as specified in its charter)

Wisconsin	39-1382325
(State of organization)	(I.R.S. Employer Identification No.)
3700 West Juneau Avenue
Milwaukee, Wisconsin	53208
(Address of principal executive offices)	(Zip code)

Registrants telephone number: (414) 342-4680

None

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act.    Yes  ¨    No  x

Number of shares of the registrant’s common stock outstanding at May 3, 2012: 231,519,008 shares

Harley-Davidson, Inc.

Form 10-Q

For The Quarter Ended April 1, 2012

Part I	Financial Information
Item 1.	Financial Statements	3
	Condensed Consolidated Statements of Operations	3
	Condensed Consolidated Statements of Comprehensive Income	4
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Cash Flows	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	53
Item 4.	Controls and Procedures	53
Part II	Other Information	54
Item 1.	Legal Proceedings	54
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	54
Item 6.	Exhibits	55
Signatures		56

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PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

	Three months ended
	April 1, 2012		March 27, 2011
Revenue:
Motorcycles and related products	$	1,273,369	$	1,063,044
Financial services		156,322		161,886
Total revenue		1,429,691		1,224,930
Costs and expenses:
Motorcycles and related products cost of goods sold		816,859		711,178
Financial services interest expense		51,256		58,035
Financial services provision for credit losses		9,014		5,606
Selling, administrative and engineering expense		265,653		234,115
Restructuring expense		11,451		22,999
Total costs and expenses		1,154,233		1,031,933
Operating income		275,458		192,997
Investment income		1,933		1,398
Interest expense		11,495		11,481
Income before provision for income taxes		265,896		182,914
Provision for income taxes		93,861		63,654
Income from continuing operations		172,035		119,260
Loss from discontinued operations, net of tax		—		—
Net income	$	172,035	$	119,260
Earnings per common share from continuing operations:
Basic	$	0.75	$	0.51
Diluted	$	0.74	$	0.51
Loss per common share from discontinued operations:
Basic	$	—	$	—
Diluted	$	—	$	—
Earnings per common share:
Basic	$	0.75	$	0.51
Diluted	$	0.74	$	0.51
Cash dividends per common share	$	0.155	$	0.10

The accompanying notes are an integral part of the consolidated financial statements.

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HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

	Three months ended
	April 1, 2012		March 27, 2011
Comprehensive income	$	180,816	$	138,431

The accompanying notes are an integral part of the consolidated financial statements.

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HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

	(Unaudited) April 1, 2012		December 31, 2011		(Unaudited) March 27, 2011
ASSETS
Current assets:
Cash and cash equivalents	$	1,276,337	$	1,526,950	$	932,515
Marketable securities		134,946		153,380		115,209
Accounts receivable, net		264,272		219,039		297,671
Finance receivables, net		1,339,139		1,168,603		1,276,780
Restricted finance receivables held by variable interest entities, net		546,350		591,864		637,760
Inventories		467,941		418,006		372,323
Restricted cash held by variable interest entities		246,995		229,655		294,903
Other current assets		237,550		234,709		243,427
Total current assets		4,513,530		4,542,206		4,170,588
Finance receivables, net		2,020,036		1,754,441		1,806,563
Restricted finance receivables held by variable interest entities, net		1,971,878		2,271,773		2,304,320
Property, plant and equipment, net		791,064		809,459		799,091
Goodwill		29,740		29,081		30,988
Other long-term assets		279,099		267,204		293,592
	$	9,605,347	$	9,674,164	$	9,405,142
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	355,902	$	255,713	$	292,676
Accrued liabilities		577,619		564,172		580,083
Short-term debt		629,143		838,486		393,393
Current portion of long-term debt		399,939		399,916		—
Current portion of long-term debt held by variable interest entities		620,624		640,331		721,179
Total current liabilities		2,583,227		2,698,618		1,987,331
Long-term debt		2,784,688		2,396,871		2,963,375
Long-term debt held by variable interest entities		1,133,696		1,447,015		1,603,584
Pension liability		118,212		302,483		99,627
Postretirement healthcare liability		265,871		268,582		254,505
Other long-term liabilities		144,994		140,339		156,472
Commitments and contingencies (Note 16)
Total shareholders’ equity		2,574,659		2,420,256		2,340,248
	$	9,605,347	$	9,674,164	$	9,405,142

The accompanying notes are an integral part of the consolidated financial statements.

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HARLEY-DAVIDSON, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Three months ended
	April 1, 2012			March 27, 2011
Net cash used by operating activities of continuing operations (Note 3)	$	(73,616	)	$	(104,918	)
Cash flows from investing activities of continuing operations:
Capital expenditures		(24,680	)		(27,704	)
Origination of finance receivables		(645,247	)		(549,200	)
Collections on finance receivables		681,904			676,952
Purchases of marketable securities		—			(5,000	)
Sales and redemptions of marketable securities		20,042			29,974
Net cash provided by investing activities of continuing operations		32,019			125,022
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		397,377			447,076
Repayments of securitization debt		(333,026	)		(430,471	)
Net decrease in credit facilities and unsecured commercial paper		(224,508	)		(96,174	)
Net change in restricted cash		(17,340	)		(6,016	)
Dividends		(35,943	)		(23,643	)
Purchase of common stock for treasury		(20,745	)		(4,699	)
Excess tax benefits from share-based payments		7,962			3,262
Issuance of common stock under employee stock option plans		16,281			3,861
Net cash used by financing activities of continuing operations		(209,942	)		(106,804	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		926			(2,693	)
Net decrease in cash and cash equivalents of continuing operations		(250,613	)		(89,393	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		—			(25	)
Cash flows from investing activities of discontinued operations		—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—
		—			(25	)
Net decrease in cash and cash equivalents	$	(250,613	)	$	(89,418	)
Cash and cash equivalents:
Cash and cash equivalents - beginning of period	$	1,526,950		$	1,021,933
Cash and cash equivalents of discontinued operations - beginning of period		—			—
Net decrease in cash and cash equivalents		(250,613	)		(89,418	)
Less: Cash and cash equivalents of discontinued operations - end of period		—			—
Cash and cash equivalents - end of period	$	1,276,337		$	932,515

The accompanying notes are an integral part of the consolidated financial statements.

6

HARLEY-DAVIDSON, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Basis of Presentation and Use of Estimates

The condensed consolidated financial statements include the accounts of Harley-Davidson, Inc. and its wholly-owned subsidiaries (the Company), including the accounts of the group of companies doing business as Harley-Davidson Motor Company (HDMC) and Harley-Davidson Financial Services (HDFS). In addition, certain variable interest entities (VIEs) related to secured financing are consolidated as the Company is the primary beneficiary. All intercompany accounts and material intercompany transactions are eliminated.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the condensed consolidated balance sheets as of April 1, 2012 and March 27, 2011, the condensed consolidated statements of operations for the three month periods then ended, the condensed consolidated statements of comprehensive income for the three month periods then ended and the condensed consolidated statements of cash flows for the three month periods then ended.

Certain information and footnote disclosures normally included in complete financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) and U.S. generally accepted accounting principles (U.S. GAAP) for interim financial reporting. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

The Company operates in two business segments: Motorcycles & Related Products (Motorcycles) and Financial Services (Financial Services).

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from those estimates.

During 2008, the Company acquired Italian motorcycle manufacturer MV Agusta (MV). On October 15, 2009, the Company announced its intent to divest MV, and the Company completed the sale on August 6, 2010. MV is presented as a discontinued operation for all periods.

2. New Accounting Standards

Accounting Standards Recently Adopted

In May 2011, the FASB issued Accounting Standards Update (ASU) No. 2011-04, “Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs.” ASU No. 2011-04 clarifies the application of existing guidance within ASC Topic 820, “Fair Value Measurement” to ensure consistency between U.S. GAAP and International Financial Reporting Standards (IFRS). ASU No. 2011-04 also requires new disclosures about purchases, sales, issuances, and settlements related to Level 3 measurements and also requires new disclosures around transfers into and out of Levels 1 and 2 in the fair value hierarchy. The Company adopted ASU No. 2011-04 on January 1, 2012. The adoption of ASU No. 2011-04 required additional disclosures of the hierarchy classification for items whose fair value is not recorded on the balance sheet but is disclosed in the notes, refer to Note 9 for additional information. There was no financial impact resulting from the adoption of ASU No. 2011-04.

In June 2011, the FASB issued ASU No. 2011-05, “Presentation of Comprehensive Income.” ASU No. 2011-05 amends the guidance within ASC Topic 220, “Comprehensive Income,” to eliminate the option to present the components of other comprehensive income as part of the statement of shareholders’ equity. ASU No. 2011-05 requires that all nonowner changes in shareholders’ equity be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. The Company decided to present comprehensive income in two separate but consecutive statements. The Company adopted ASU

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No. 2011-05 on January 1, 2012. The adoption of ASU No. 2011-05 and the Company’s decision to present comprehensive income in two separate but consecutive statements required the presentation of an additional financial statement, condensed consolidated statements of comprehensive income, for all periods presented.

3. Additional Balance Sheet and Cash Flow Information

Marketable Securities

The Company’s marketable securities consisted of the following (in thousands):

	April 1, 2012		December 31, 2011		March 27, 2011
Available-for-sale:
Corporate bonds	$	134,946	$	153,380	$	55,232
U.S. Treasuries		—		—		59,977
	$	134,946	$	153,380	$	115,209

The Company’s available-for-sale securities are carried at fair value with any unrealized gains or losses reported in other comprehensive income. During the first three months of 2012 and 2011, the Company recognized gross unrealized gains in other comprehensive income of $1.6 million and $0.1 million, respectively, or $1.0 million and $0.04 million net of taxes, respectively, to adjust amortized cost to fair value. The marketable securities have contractual maturities that generally come due over the next 12 to 48 months.

Inventories

Inventories are valued at the lower of cost or market. Substantially all inventories located in the United States are valued using the last-in, first-out (LIFO) method. Other inventories are valued at the lower of cost or market using the first-in, first-out (FIFO) method. Inventories consist of the following (in thousands):

	April 1, 2012			December 31, 2011			March 27, 2011
Components at the lower of FIFO cost or market
Raw materials and work in process	$	113,127		$	113,932		$	99,538
Motorcycle finished goods		252,979			226,261			187,687
Parts and accessories and general merchandise		145,362			121,340			119,134
Inventory at lower of FIFO cost or market		511,468			461,533			406,359
Excess of FIFO over LIFO cost		(43,527	)		(43,527	)		(34,036	)
	$	467,941		$	418,006		$	372,323

8

Operating Cash Flow

The reconciliation of net income to net cash used by operating activities is as follows (in thousands):

	Three months ended
	April 1, 2012			March 27, 2011
Cash flows from operating activities:
Net income	$	172,035		$	119,260
Loss from discontinued operations		—			—
Income from continuing operations		172,035			119,260
Adjustments to reconcile income from continuing operations to net cash used by operating activities:
Depreciation		43,203			42,947
Amortization of deferred loan origination costs		18,547			19,329
Amortization of financing origination fees		2,743			3,107
Provision for employee long-term benefits		17,293			15,563
Contributions to pension and postretirement plans		(206,832	)		(204,816	)
Stock compensation expense		11,744			9,153
Net change in wholesale finance receivables related to sales		(151,046	)		(163,967	)
Provision for credit losses		9,014			5,606
Pension and postretirement healthcare plan curtailment and settlement expense		—			236
Foreign currency adjustments		(2,911	)		29
Other, net		1,505			14,112
Changes in current assets and liabilities:
Accounts receivable, net		(43,745	)		(27,048	)
Finance receivables - accrued interest and other		3,299			3,542
Inventories		(47,168	)		(38,200	)
Accounts payable and accrued liabilities		117,460			98,960
Restructuring reserves		1,296			7,757
Derivative instruments		(486	)		2,157
Other		(19,567	)		(12,645	)
Total adjustments		(245,651	)		(224,178	)
Net cash used by operating activities of continuing operations	$	(73,616	)	$	(104,918	)

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4. Discontinued Operations

In October 2009, the Company unveiled a new business strategy to drive growth through a focus of efforts and resources on the unique strengths of the Harley-Davidson brand and to enhance productivity and profitability through continuous improvement. The Company’s Board of Directors approved and the Company committed to the divestiture of MV as part of this strategy. The Company engaged a third party investment bank to assist with the marketing and sale of MV. During 2009, the Company recorded pre-tax impairment charges of $115.4 million related to MV and a net tax benefit of $40 million related to losses estimated in connection with the sale of MV. As of December 31, 2009, the Company estimated the total tax benefit associated with losses related to the sale of MV to be $66 million of which $26 million was deemed uncertain and appropriately reserved against.

At each subsequent reporting date in 2010 through the date of sale of MV in August 2010, the fair value less selling costs was re-assessed and additional impairment charges totaling $111.8 million and additional tax benefits totaling $18 million were recognized in 2010. As the effort to sell MV progressed into 2010, adverse factors led to decreases in the fair value of MV. During 2010, challenging economic conditions continued to persist, negatively impacting the appetite of prospective buyers and the motorcycle industry as a whole. Information coming directly from the selling process, including discussions with the prospective buyers, indicated a fair value that was less than previously estimated.

On August 6, 2010, the Company concluded its sale of MV to MV Augusta Motor Holding S.r.l., a company controlled by the former owner of MV. Under the agreement relating to the sale, (1) the Company received nominal consideration in return for the transfer of MV and related assets; (2) the parties waived their respective rights under the stock purchase agreement and other documents related to the Company’s purchase of MV in 2008, which included a waiver of the former owner’s right to contingent earn-out consideration; and (3) the Company contributed 20.0 million Euros to MV as operating capital. The 20.0 million Euros contributed were factored into the Company’s estimate of MV’s fair value prior to the sale and was recognized in the 2010 impairment charges discussed above. As a result of the impairment charges recorded in 2009 and 2010 prior to the sale, the Company only incurred an immaterial loss on the date of sale, which was included in the loss from discontinued operations, net of tax, during the year ended December 31, 2010.

As of December 31, 2010, the Company’s estimated total tax benefit associated with the loss on the sale of MV was $101.0 million, of which $43.5 million was deemed uncertain and appropriately reserved against. As a result, the total cumulative net tax benefit recognized as of December 31, 2010 was $57.5 million. The increase in the estimated tax benefit during 2010 was driven by an increase in the losses related to the sale of MV, not a change in the tax position.

In determining the tax benefit recognized from October 2009 through December 2010, the Company engaged appropriate technical expertise and considered all relevant available information. In accordance with ASC 740, “Income Taxes,” at each balance sheet date during this period, the Company re-evaluated the overall tax benefit, determined that it was at least more likely than not that it would be sustained upon review and calculated the amount of recognized tax benefit based on a cumulative probability basis.

Beginning in 2010, the Company voluntarily elected to participate in a pre-filing agreement process with the Internal Revenue Service (IRS) in order to accelerate their review of the Company’s tax position related to MV. The IRS effectively completed its review in late 2011 and executed a Closing Agreement on Final Determination Covering Specific Matters with the Company.

There were no changes to the Company’s estimated gross or recognized tax benefit associated with the loss on the sale of MV during the first three quarters of 2011. In the fourth quarter of 2011, given the outcome of the closing agreement, the Company recognized a $43.5 million tax benefit by reversing the reserve recorded as of September 25, 2011 and recognized an incremental $7.5 million tax benefit related to the final calculation of the tax basis in the loan to and the stock of MV.

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5. Restructuring Expense

2011 Restructuring Plans

In December 2011, the Company made a decision to cease operations at New Castalloy, its Australian subsidiary and producer of cast motorcycle wheels and wheel hubs, and source those components through other existing suppliers (2011 New Castalloy Restructuring Plan). The Company expects the transition of supply from New Castalloy to be complete by mid-2013. The decision to close New Castalloy comes as part of the Company’s overall long term strategy to develop world-class manufacturing capability throughout the Company by restructuring and consolidating operations for greater competitiveness, efficiency and flexibility. In connection with this decision, the Company will reduce its workforce by approximately 200 employees by mid-2013.

Under the 2011 New Castalloy Restructuring Plan, restructuring expenses consist of employee severance and termination costs, accelerated depreciation and other related costs. The Company expects to incur about $30 million in restructuring charges related to the transition through 2013. Approximately 35% of the $30 million will be non-cash charges. On a cumulative basis, the Company has incurred $12.4 million of restructuring expense under the 2011 New Castalloy Restructuring Plan as of April 1, 2012, of which $3.0 million was incurred during the first quarter of 2012.

In February 2011, the Company’s unionized employees at its facility in Kansas City, Missouri ratified a new seven-year labor agreement. The new agreement took effect on August 1, 2011. The new contract is similar to the labor agreements ratified at the Company’s Wisconsin facilities in September 2010 and its York, Pennsylvania facility in December 2009, and allows for similar flexibility and increased production efficiency. Once the new contract is fully implemented, the production system in Kansas City, like Wisconsin and York, will include the addition of a flexible workforce component.

After taking actions to implement the new ratified labor agreement (2011 Kansas City Restructuring Plan), the Company expects to have about 145 fewer full-time hourly unionized employees in its Kansas City facility than would have been required under the prior contract.

Under the 2011 Kansas City Restructuring Plan, restructuring expenses consist of employee severance and termination costs and other related costs. The Company expects to incur approximately $15 million in restructuring expenses related to the new contract through 2012, of which approximately 10% are expected to be non-cash. On a cumulative basis, the Company has incurred $9.3 million of restructuring expense under the 2011 Kansas City Restructuring Plan as of April 1, 2012, of which $0.5 million was incurred during the first quarter of 2012.

For the three months ended March 27, 2011, restructuring expense included $0.2 million of noncash curtailment losses related to the Company’s pension plan that covers employees of the Kansas City facility.

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The following table summarizes the Motorcycle segment’s 2011 Kansas City Restructuring Plan and 2011 New Castalloy Restructuring Plan reserve activity and balances as recorded in accrued liabilities (in thousands):

	Three months ended April 1, 2012
	Kansas City						New Castalloy												Consolidated
	Employee Severance and Termination Costs		Other		Total		Employee Severance and Termination Costs			Accelerated Depreciation			Other			Total			Total
Balance, beginning of period	$	4,123	$	—	$	4,123	$	8,428		$	—		$	305		$	8,733		$	12,856
Restructuring expense		542		—		542		571			2,099			349			3,019			3,561
Utilized - cash		—		—		—		(156	)		—			(361	)		(517	)		(517	)
Utilized - noncash		—		—		—		—			(2,099	)		—			(2,099	)		(2,099	)
Balance, end of period	$	4,665	$	—	$	4,665	$	8,843		$	—		$	293		$	9,136		$	13,801

	Three months ended March 27, 2011
	Kansas City
	Employee Severance and Termination Costs			Other			Total
Restructuring expense		6,382			134			6,516
Utilized - cash		—			(134	)		(134	)
Utilized - noncash		(236	)		—			(236	)
Balance, end of period	$	6,146		$	—		$	6,146

2010 Restructuring Plan

In September 2010, the Company’s unionized employees in Wisconsin ratified three separate new seven-year labor agreements which took effect in April 2012 when the prior contracts expired. The new contracts are similar to the labor agreement ratified at the Company’s York, Pennsylvania facility in December 2009 and allow for similar flexibility and increased production efficiency. Once the new contracts are fully implemented, the production system in Wisconsin, like York, will include the addition of a flexible workforce component.

Based on the new ratified labor agreements (2010 Restructuring Plan), the Company expects to have about 250 fewer full-time hourly unionized employees in its Milwaukee-area facilities when the contracts are fully implemented than would have been required under the prior contract. In Tomahawk, the Company expects to have about 75 fewer full-time hourly unionized employees when the contract is fully implemented than would have been required under the prior contract.

Under the 2010 Restructuring Plan, restructuring expenses consist of employee severance and termination costs and other related costs. The Company expects to incur approximately $67 million in restructuring expenses related to the new contracts through 2012, of which approximately 42% are expected to be non-cash. On a cumulative basis, the Company has incurred $61.5 million of restructuring expense under the 2010 Restructuring Plan as of April 1, 2012, of which $4.5 million was incurred during the first quarter of 2012.

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The following table summarizes the Motorcycles segment’s 2010 Restructuring Plan reserve activity and balances as recorded in accrued liabilities (in thousands):

	Three months ended April 1, 2012			Three months ended March 27, 2011
	Employee Severance and Termination Costs			Employee Severance and Termination Costs
Balance, beginning of period	$	20,361		$	8,652
Restructuring expense		1,886			3,144
Utilized - cash		(26	)		(594	)
Balance, end of period	$	22,221		$	11,202

2009 Restructuring Plan

During 2009, in response to the U.S. economic recession and worldwide slowdown in consumer demand, the Company committed to a volume reduction and a combination of restructuring actions (2009 Restructuring Plan) that are expected to be completed at various dates between 2009 and 2012. The actions were designed to reduce administrative costs, eliminate excess capacity and exit non-core business operations. The Company’s significant announced actions include the restructuring and transformation of its York, Pennsylvania production facility including the implementation of a new more flexible unionized labor agreement; consolidation of facilities related to engine and transmission production; outsourcing of certain distribution and transportation activities and exiting the Buell product line.

The 2009 Restructuring Plan included a reduction of approximately 2,700 to 2,900 hourly production positions and approximately 720 non-production, primarily salaried positions within the Motorcycles segment and approximately 100 salaried positions in the Financial Services segment.

Under the 2009 Restructuring Plan, restructuring expenses consist of employee severance and termination costs, accelerated depreciation on the long-lived assets that will be exited as part of the 2009 Restructuring Plan and other related costs. The Company expects total costs related to the 2009 Restructuring Plan to result in restructuring and impairment expenses of approximately $388 million to $408 million from 2009 to 2012, of which approximately 30% are expected to be non-cash. On a cumulative basis, the Company has incurred $386.6 million of restructuring and impairment expense under the 2009 Restructuring Plan as of April 1, 2012, of which $3.3 million was incurred during the first quarter of 2012. Approximately 3,600 employees have left the Company under the 2009 Restructuring Plan as of April 1, 2012.

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The following table summarizes the Company’s 2009 Restructuring Plan reserve activity and balances recorded in accrued liabilities (in thousands):

	Three months ended April 1, 2012
	Motorcycles & Related Products
	Employee Severance and Termination Costs			Accelerated Depreciation		Other			Total
Balance, beginning of period	$	10,089		$	—	$	—		$	10,089
Restructuring expense		323			—		5,681			6,004
Utilized - cash		(1,846	)		—		(5,669	)		(7,515	)
Utilized - noncash		—			—		—			—
Balance, end of period	$	8,566		$	—	$	12		$	8,578
	Three months ended March 27, 2011
	Motorcycles & Related Products
	Employee Severance and Termination Costs			Accelerated Depreciation		Other			Total
Balance, beginning of period	$	23,818		$	—	$	2,764		$	26,582
Restructuring expense		2,954			—		10,385			13,339
Utilized - cash		(4,028	)		—		(10,546	)		(14,574	)
Utilized - noncash		—			—		296			296
Balance, beginning of period	$	22,744		$	—	$	2,899		$	25,643

Other restructuring costs under the 2009 Restructuring Plan include items such as the exit costs for terminating supply contracts, lease termination costs and moving costs. During the first quarter of 2012, the Company released $2.7 million of its 2009 Restructuring Plan reserve related to employee severance costs as these costs are no longer expected to be incurred.

6. Finance Receivables

HDFS provides retail financial services to customers of the Company’s independent dealers in the United States and Canada. The origination of retail loans is a separate and distinct transaction between HDFS and the retail customer, unrelated to the Company’s sale of product to its dealers. Retail finance receivables consist of secured promissory notes and installment loans. HDFS holds either titles or liens on titles to vehicles financed by promissory notes and installment loans.

HDFS offers wholesale financing to the Company’s independent dealers. Wholesale loans to dealers are generally secured by financed inventory or property and are originated in the U.S. and Canada.

Finance receivables, net, including finance receivables held by VIEs, consisted of the following (in thousands):

	April 1, 2012			December 31, 2011			March 27, 2011
Retail	$	5,043,584		$	5,087,490		$	5,225,155
Wholesale		956,322			824,640			959,952
		5,999,906			5,912,130			6,185,107
Allowance for credit losses		(122,503	)		(125,449	)		(159,684	)
	$	5,877,403		$	5,786,681		$	6,025,423

At April 1, 2012, December 31, 2011 and March 27, 2011, the Company’s Condensed Consolidated Balance Sheet included finance receivables, net of $2.52 billion, $2.86 billion and $2.94 billion, respectively, which were restricted as collateral for the payment of debt held by VIEs and other related obligations as discussed in Note 7. These receivables are included in retail finance receivables in the table above.

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A provision for credit losses on finance receivables is charged to earnings in amounts sufficient to maintain the allowance for credit losses on finance receivables at a level that is adequate to cover losses of principal inherent in the existing portfolio. The allowance for credit losses on finance receivables represents management’s estimate of probable losses inherent in the finance receivable portfolio as of the balance sheet date. However, due to the use of projections and assumptions in estimating the losses, the amount of losses actually incurred by the Company could differ from the amounts estimated.

Changes in the allowance for credit losses on finance receivables by portfolio were as follows (in thousands):

	Three months ended April 1, 2012
	Retail			Wholesale		Total
Balance, beginning of period	$	116,112		$	9,337	$	125,449
Provision for credit losses		8,705			309		9,014
Charge-offs		(25,852	)		—		(25,852	)
Recoveries		13,892			—		13,892
Balance, end of period	$	112,857		$	9,646	$	122,503
	Three months ended March 27, 2011
	Retail			Wholesale		Total
Balance, beginning of period	$	157,791		$	15,798	$	173,589
Provision for credit losses		3,439			2,167		5,606
Charge-offs		(35,191	)		—		(35,191	)
Recoveries		15,665			15		15,680
Balance, end of period	$	141,704		$	17,980	$	159,684

Included in the $112.9 and $141.7 million retail allowance for credit losses on finance receivables is $57.0 and $82.3 million, respectively, related to finance receivables held by VIEs.

Portions of the allowance for credit losses on finance receivables are specified to cover estimated losses on finance receivables specifically identified for impairment. The unspecified portion of the allowance for credit losses on finance receivables covers estimated losses on finance receivables which are collectively reviewed for impairment. Finance receivables are considered impaired when management determines it is probable that the Company will be unable to collect all amounts due according to the terms of the loan agreement.

The retail portfolio primarily consists of a large number of small balance, homogeneous finance receivables. HDFS performs a periodic and systematic collective evaluation of the adequacy of the retail allowance for credit losses. HDFS utilizes loss forecast models which consider a variety of factors including, but not limited to, historical loss trends, origination or vintage analysis, known and inherent risks in the portfolio, the value of the underlying collateral, recovery rates and current economic conditions including items such as unemployment rates. As retail finance receivables are collectively and not individually reviewed for impairment, this portfolio does not have finance receivables specifically impaired.

The wholesale portfolio is primarily composed of large balance, non-homogeneous loans. The Company’s evaluation for the wholesale allowance for credit losses is first based on a loan-by-loan review. A specific allowance for credit losses is established for wholesale finance receivables determined to be individually impaired when management concludes that the borrower will not be able to make full payment of the contractual amounts due based on the original terms of the loan agreement. The impairment is determined based on the cash

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that the Company expects to receive discounted at the loan’s original interest rate or the fair value of the collateral, if the loan is collateral-dependent. In establishing the allowance for credit losses, management considers a number of factors including the specific borrower’s financial performance as well as ability to repay. Finance receivables in the wholesale portfolio that are not considered impaired on an individual basis are segregated, based on similar risk characteristics, according to the Company’s internal risk rating system and collectively evaluated for impairment. The related allowance for credit losses is based on factors such as the Company’s past loan loss experience, current economic conditions as well as the value of the underlying collateral.

Impaired wholesale finance receivables also include loans that have been modified in troubled debt restructurings as a concession to borrowers experiencing financial difficulty. Generally, it is the Company’s policy not to change the terms and conditions of finance receivables. However, to minimize the economic loss, the Company may modify certain impaired finance receivables in troubled debt restructurings. Total restructured finance receivables are not significant.

The allowance for credit losses and finance receivables by portfolio, segregated by those amounts that are individually evaluated for impairment and those that are collectively evaluated for impairment was, as follows (in thousands):

	April 1, 2012
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		112,857		9,646		122,503
Total allowance for credit losses	$	112,857	$	9,646	$	122,503
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		5,043,584		956,322		5,999,906
Total finance receivables	$	5,043,584	$	956,322	$	5,999,906

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	December 31, 2011
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		116,112		9,337		125,449
Total allowance for credit losses	$	116,112	$	9,337	$	125,449
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		5,087,490		824,640		5,912,130
Total finance receivables	$	5,087,490	$	824,640	$	5,912,130
	March 27, 2011
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	3,451	$	3,451
Collectively evaluated for impairment		141,704		14,529		156,233
Total allowance for credit losses	$	141,704	$	17,980	$	159,684
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	5,187	$	5,187
Collectively evaluated for impairment		5,225,155		954,765		6,179,920
Total finance receivables	$	5,225,155	$	959,952	$	6,185,107

There were no wholesale finance receivables at April 1, 2012 or December 31, 2011 that were individually deemed to be impaired under ASC Topic 310, “Receivables”. Additional information related to the wholesale finance receivables that were individually deemed to be impaired under ASC Topic 310, “Receivables,” at March 27, 2011 includes (in thousands):

	Recorded Investment		Unpaid Principal Balance		Related Allowance		Average Recorded Investment		Interest Income Recognized
Wholesale:
No related allowance recorded	$	—	$	—	$	—	$	—	$	—
Related allowance recorded		5,187		5,037		3,451		5,527		—
Total impaired wholesale finance receivables	$	5,187	$	5,037	$	3,451	$	5,527	$	—

Retail finance receivables are contractually delinquent if the minimum payment is not received by the specified due date. Retail finance receivables are generally charged-off at 120 days contractually past due. Retail finance receivables accrue interest until either collected or charged-off. Accordingly, as of April 1, 2012, December 31, 2011 and March 27, 2011, all retail finance receivables were accounted for as interest-earning receivables, of which $16.3 million, $27.5 million and $25.1 million, respectively, were 90 days or more past due.

Wholesale finance receivables are delinquent if the minimum payment is not received by the contractual due date. Wholesale finance receivables are written down once management determines that the specific borrower does not have the ability to repay the loan in full. Interest continues to accrue on past due wholesale finance receivables until the date the collection of the finance receivables becomes doubtful, at which time the finance receivable is placed on non-accrual status. The Company will resume accruing interest on these

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wholesale finance receivables when payments are current according to the terms of the loan agreements and future payments are reasonably assured. While on non-accrual status, all cash received is applied to principal or interest as appropriate. There were no wholesale receivables on non-accrual status at April 1, 2012 or December 31, 2011. The recorded investment of non-accrual status wholesale finance receivables at March 27, 2011 was $5.2 million. At April 1, 2012, December 31, 2011 and March 27, 2011, $0.3 million, $0.9 million, and $2.0 million of wholesale finance receivables were 90 days or more past due and accruing interest, respectively.

An analysis of the aging of past due finance receivables, which includes non-accrual status finance receivables was as follows (in thousands):

	April 1, 2012
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	4,930,739	$	75,560	$	21,023	$	16,262	$	112,845	$	5,043,584
Wholesale		955,493		354		149		326		829		956,322
Total	$	5,886,232	$	75,914	$	21,172	$	16,588	$	113,674	$	5,999,906
	December 31, 2011
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	4,915,711	$	107,373	$	36,937	$	27,469	$	171,779	$	5,087,490
Wholesale		822,610		777		344		909		2,030		824,640
Total	$	5,738,321	$	108,150	$	37,281	$	28,378	$	173,809	$	5,912,130
	March 27, 2011
	Current		31-60 Days Past Due		61-90 Days Past Due		Greater than 90 Days Past Due		Total Past Due		Total Finance Receivables
Retail	$	5,059,870	$	107,471	$	32,691	$	25,123	$	165,285	$	5,225,155
Wholesale		955,478		881		895		2,698		4,474		959,952
Total	$	6,015,348	$	108,352	$	33,586	$	27,821	$	169,759	$	6,185,107

A significant part of managing HDFS’ finance receivable portfolios includes the assessment of credit risk associated with each borrower. As the credit risk varies between the retail and wholesale portfolios, HDFS utilizes different credit risk indicators for each portfolio.

HDFS manages retail credit risk through its credit approval policy and ongoing collection efforts. HDFS uses FICO scores to differentiate the expected default rates of retail credit applicants enabling the Company to better evaluate credit applicants for approval and to tailor pricing according to this assessment. Retail loans with a FICO score of 640 or above at origination are considered prime, and loans with a FICO score below 640 are considered sub-prime. These credit quality indicators are determined at the time of loan origination and are not updated subsequent to the loan origination date.

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The recorded investment of retail finance receivables, by credit quality indicator, was as follows (in thousands):

	April 1, 2012		December 31, 2011		March 27, 2011
Prime	$	4,056,602	$	4,097,048	$	4,185,825
Sub-prime		986,982		990,442		1,039,330
Total	$	5,043,584	$	5,087,490	$	5,225,155

HDFS’ credit risk on the wholesale portfolio is different from that of the retail portfolio. Whereas the retail portfolio represents a relatively homogeneous pool of retail finance receivables that exhibit more consistent loss patterns, the wholesale portfolio exposures are less consistent. HDFS utilizes an internal credit risk rating system to manage credit risk exposure consistently across wholesale borrowers and capture credit risk factors for each borrower.

HDFS uses the following internal credit quality indicators, based on the Company’s internal risk rating system, listed from highest level of risk to lowest level of risk for the wholesale portfolio: Doubtful, Substandard, Special Mention, Medium Risk and Low Risk. Based upon management’s review, the dealers classified in the Doubtful category are the dealers with the greatest likelihood of being charged-off, while the dealers classified as Low Risk are least likely to be charged-off. The internal rating system considers factors such as the specific borrowers’ ability to repay and the estimated value of any collateral. Dealer risk rating classifications are reviewed and updated on a quarterly basis.

The recorded investment of wholesale finance receivables, by internal credit quality indicator, was as follows (in thousands):

	April 1, 2012		December 31, 2011		March 27, 2011
Doubtful	$	13,108	$	13,048	$	20,550
Substandard		5,599		5,052		19,510
Special Mention		8,618		14,361		21,069
Medium Risk		6,365		3,032		16,225
Low Risk		922,632		789,147		882,598
Total	$	956,322	$	824,640	$	959,952

7. Asset-Backed Financing

HDFS participates in asset-backed financing through both term asset-backed securitization transactions and its asset-backed commercial paper conduit facility. In both types of asset-backed financing programs, HDFS transfers U.S. retail motorcycle finance receivables to a consolidated special purpose entity (SPE) while retaining the servicing rights. Each SPE then converts those assets into cash, through the issuance of debt. These SPEs are considered VIEs under U.S. GAAP. HDFS is required to consolidate any VIEs in which it is deemed to be the primary beneficiary through having power over the significant activities of the entity and having an obligation to absorb losses or the right to receive benefits from the VIE which are potentially significant to the VIE.

HDFS is considered to have power over the significant activities of its term asset-backed securitization and asset-backed commercial paper conduit facility VIEs due to its role as servicer. Servicing fees are typically not considered potentially significant variable interests in a VIE. However, HDFS retains a residual interest in the VIEs in the form of a debt security, which gives HDFS the right to receive benefits that could be potentially significant to the VIE. Therefore, the Company is the primary beneficiary and consolidates all of its VIEs within its consolidated financial statements. Servicing fees paid by VIEs to HDFS are eliminated in consolidation and therefore are not recorded on a consolidated basis.

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HDFS is not required, and does not currently intend, to provide any additional financial support to its VIEs. Investors and creditors only have recourse to the assets held by the VIEs.

The Company’s VIEs have been aggregated on the balance sheet due to the similarity of the nature of the assets involved as well as the purpose and design of the VIEs.

Term Asset-Backed Securitization VIEs

The Company transfers U.S. retail motorcycle finance receivables to SPEs which in turn issue secured notes to investors, with various maturities and interest rates, secured by future collections of the purchased U.S. retail motorcycle finance receivables. Each term asset-backed securitization SPE is a separate legal entity and the U.S. retail motorcycle finance receivables included in each term asset-backed securitizations are only available for payment of that secured debt and other obligations arising from the term asset-backed securitization transaction and are not available to pay other obligations or claims of the Company’s creditors until the associated secured debt and other obligations are satisfied. Cash and cash equivalent balances held by the SPEs are used only to support the securitizations. There are no amortization schedules for the secured notes; however, the debt is reduced monthly as available collections on the related U.S. retail motorcycle finance receivables are applied to outstanding principal. The secured notes’ contractual lives have various maturities ranging from 2012 to 2018.

There were no term asset-backed securitization transactions completed during the three months ended April 1, 2012 or March 27, 2011.

The following table presents the assets and liabilities of the consolidated term asset-backed securitization SPEs that were included in the Company’s financial statements (in thousands):

	April 1, 2012			December 31, 2011			March 27, 2011
Assets:
Finance receivables	$	2,564,585		$	2,916,219		$	3,000,580
Allowance for credit losses		(56,810	)		(65,735	)		(81,631	)
Restricted cash		245,912			228,776			293,090
Other assets		5,620			6,772			10,499
Total assets	$	2,759,307		$	3,086,032		$	3,222,538
Liabilities
Term asset-backed securitization debt	$	1,754,320		$	2,087,346		$	2,324,763

Asset-Backed Commercial Paper Conduit Facility VIE

On September 9, 2011, the Company amended and restated its third-party bank sponsored asset-backed commercial paper conduit facility which provides for a total aggregate commitment of $600.0 million based on, among other things, the amount of eligible U.S. retail motorcycle loans held by the SPE as collateral. The amended agreement has terms similar to the prior agreement and is for the same amount. Under the facility, HDFS may transfer U.S. retail motorcycle finance receivables to a SPE, which in turn may issue debt to third-party bank-sponsored asset-backed commercial paper conduits. The assets of the SPE are restricted as collateral for the payment of the debt or other obligations arising in the transaction and are not available to pay other obligations or claims of the Company’s creditors. The terms for this debt provide for interest on the outstanding principal based on prevailing commercial paper rates, or LIBOR plus a specified margin to the extent the advance is not funded by a conduit lender through the issuance of commercial paper. The conduit facility also provides for an unused commitment fee based on the unused portion of the total aggregate commitment of $600.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the conduit facility, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of HDFS and the lenders, the conduit facility has an expiration date of September 7, 2012.

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The following table presents the assets of the asset-backed commercial paper conduit facility SPEs that were included in our financial statements (in thousands);

	April 1, 2012			December 31, 2011			March 27, 2011
Finance receivables	$	10,689		$	13,455		$	23,776
Allowance for credit losses		(236	)		(302	)		(645	)
Restricted cash		1,083			879			1,813
Other assets		312			449			598
Total assets	$	11,848		$	14,481		$	25,542

The SPEs had no borrowings outstanding under the conduit facility at April 1, 2012, December 31, 2011 or March 27, 2011, therefore, these assets are restricted as collateral for the payment of fees associated with the unused portion of the total aggregate commitment of $600.0 million.

8. Fair Value Measurements

Certain assets and liabilities are recorded at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. In determining fair value of assets and liabilities, the Company uses various valuation techniques. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment.

The Company assesses the inputs used to measure fair value using a three-tier hierarchy. The hierarchy indicates the extent to which inputs used in measuring fair value are observable in the market. Level 1 inputs include quoted prices for identical instruments and are the most observable. Level 2 inputs include quoted prices for similar assets and observable inputs such as interest rates, foreign currency exchange rates, commodity rates and yield curves. The Company uses the market approach to derive the fair value for its level 2 fair value measurements. Foreign currency exchange contracts are valued using publicly quoted spot and forward prices; commodity contracts are valued using publicly quoted prices, where available, or dealer quotes; interest rate swaps are valued using publicized swap curves; and investments in marketable debt and equity securities are valued using publicly quoted prices.

Level 3 inputs are not observable in the market and include management’s judgments about the assumptions market participants would use in pricing the asset or liability. The use of observable and unobservable inputs is reflected in the hierarchy assessment disclosed in the following tables.

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Recurring Fair Value Measurements

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis (in thousands):

	April 1, 2012
	Balance as of April 1, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	997,669	$	997,669	$	—	$	—
Marketable securities		134,946		—		134,946		—
Derivatives		6,345		—		6,345		—
	$	1,138,960	$	997,669	$	141,291	$	—
Liabilities:
Derivatives	$	2,234	$	—	$	2,234	$	—
	December 31, 2011
	Balance as of December 31, 2011		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	1,302,367	$	1,302,367	$	—	$	—
Marketable securities		153,380		—		153,380		—
Derivatives		16,443		—		16,443		—
	$	1,472,190	$	1,302,367	$	169,823	$	—
Liabilities:
Derivatives	$	5,136	$	—	$	5,136	$	—
	March 27, 2011
	Balance as of March 27, 2011		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	593,344	$	593,344	$	—	$	—
Marketable securities		115,209		59,977		55,232		—
Derivatives		18		—		18		—
	$	708,571	$	653,321	$	55,250	$	—
Liabilities:
Derivatives	$	24,787	$	—	$	24,787	$	—

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9. Fair Value of Financial Instruments

The Company’s financial instruments consist primarily of cash and cash equivalents, marketable securities, trade receivables, finance receivables, net, trade payables, debt, foreign currency contracts and interest rate swaps (derivative instruments are discussed further in Note 10). Under U.S. GAAP, certain of these items are required to be recorded in the financial statements at fair value, while others are required to be recorded at historical cost.

The following table summarizes the fair value and carrying value of the Company’s financial instruments (in thousands):

	April 1, 2012				December 31, 2011				March 27, 2011
	Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value
Assets:
Cash and cash equivalents	$	1,276,337	$	1,276,337	$	1,526,950	$	1,526,950	$	932,515	$	932,515
Marketable securities	$	134,946	$	134,946	$	153,380	$	153,380	$	115,209	$	115,209
Accounts receivable, net	$	264,272	$	264,272	$	219,039	$	219,039	$	297,671	$	297,671
Derivatives	$	6,345	$	6,345	$	16,443	$	16,443	$	18	$	18
Finance receivables, net	$	5,961,825	$	5,877,403	$	5,888,040	$	5,786,681	$	6,105,350	$	6,025,423
Restricted cash held by variable interest entities	$	246,995	$	246,995	$	229,655	$	229,655	$	294,903	$	294,903
Liabilities:
Accounts payable	$	355,902	$	355,902	$	255,713	$	255,713	$	292,676	$	292,676
Derivatives	$	2,234	$	2,234	$	5,136	$	5,136	$	24,787	$	24,787
Unsecured commercial paper	$	662,343	$	662,343	$	874,286	$	874,286	$	488,493	$	488,493
Credit facilities	$	150,195	$	150,195	$	159,794	$	159,794	$	217,651	$	217,651
Medium-term notes	$	2,936,475	$	2,698,232	$	2,561,458	$	2,298,193	$	2,514,092	$	2,347,624
Senior unsecured notes	$	366,651	$	303,000	$	376,513	$	303,000	$	406,961	$	303,000
Term asset-backed securitization debt	$	1,768,140	$	1,754,320	$	2,099,060	$	2,087,346	$	2,366,270	$	2,324,763

Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Net and Accounts Payable – With the exception of certain money-market investments, these items are recorded in the financial statements at historical cost. The historical cost basis for these amounts is estimated to approximate their respective fair values due to the short maturity of these instruments.

Marketable Securities – Marketable securities are recorded in the financial statements at fair value. The fair value of marketable securities is based primarily on quoted market prices of similar financial assets. Changes in fair value are recorded, net of tax, as other comprehensive income and included as a component of shareholders’ equity. Fair Value is based on Level 2 inputs.

Finance Receivables, Net – Finance receivables, net includes finance receivables held for investment, net and restricted finance receivables held by VIEs, net. Retail and wholesale finance receivables are recorded in the financial statements at historical cost less a provision for credit losses. The fair value of retail finance receivables is generally calculated by discounting future cash flows using an estimated discount rate that reflects current credit, interest rate and prepayment risks associated with similar types of instruments. Fair value is determined based on Level 3 inputs. The historical cost basis of wholesale finance receivables approximates fair value because they either are short-term or have interest rates that adjust with changes in market interest rates.

Debt – Debt is generally recorded in the financial statements at historical cost. The carrying value of debt provided under credit facilities approximates fair value since the interest rates charged under the facilities are tied directly to market rates and fluctuate as market rates change. The carrying value of unsecured commercial paper approximates fair value due to its short maturity. Fair value is calculated using Level 2 inputs.

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The fair values of the medium-term notes maturing in December 2012, December 2014, March 2016, March 2017 and June 2018 are estimated based upon rates currently available for debt with similar terms and remaining maturities. Fair value is calculated using Level 2 inputs.

The fair value of the senior unsecured notes is estimated based upon rates currently available for debt with similar terms and remaining maturities. Fair value is calculated using Level 2 inputs.

The fair value of the debt related to term asset-backed securitization transactions is estimated based on pricing currently available for transactions with similar terms and maturities. Fair value is calculated using Level 2 inputs.

10. Derivative Instruments and Hedging Activities

The Company is exposed to certain risks such as foreign currency exchange rate risk, interest rate risk and commodity price risk. To reduce its exposure to such risks, the Company selectively uses derivative financial instruments. All derivative transactions are authorized and executed pursuant to regularly reviewed policies and procedures, which prohibit the use of financial instruments for speculative trading purposes.

All derivative instruments are recognized on the balance sheet at fair value (see Note 9). In accordance with ASC Topic 815, “Derivatives and Hedging,” the accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, further, on the type of hedging relationship. Changes in the fair value of derivatives that are designated as fair value hedges, along with the gain or loss on the hedged item, are recorded in current period earnings. For derivative instruments that are designated as cash flow hedges, the effective portion of gains and losses that result from changes in the fair value of derivative instruments is initially recorded in other comprehensive income (OCI) and subsequently reclassified into earnings when the hedged item affects income. The Company assesses, both at the inception of each hedge and on an on-going basis, whether the derivatives that are used in its hedging transactions are highly effective in offsetting changes in cash flows of the hedged items. Any ineffective portion is immediately recognized in earnings. No component of a hedging derivative instrument’s gain or loss is excluded from the assessment of hedge effectiveness. Derivative instruments that do not qualify for hedge accounting are recorded at fair value and any changes in fair value are recorded in current period earnings.

The Company sells its products internationally and in most markets those sales are made in the foreign country’s local currency. As a result, the Company’s earnings can be affected by fluctuations in the value of the U.S. dollar relative to foreign currency. The Company’s most significant foreign currency risk relates to the Euro, the Australian dollar and the Japanese yen. The Company utilizes foreign currency contracts to mitigate the effects of these currencies’ fluctuations on earnings. The foreign currency contracts are entered into with banks and allow the Company to exchange a specified amount of foreign currency for U.S. dollars at a future date, based on a fixed exchange rate.

The Company utilizes natural gas contracts to hedge portions of the cost of natural gas consumed in the Company’s motorcycle production operations.

The Company’s foreign currency contracts and natural gas contracts generally have maturities of less than one year.

The Company’s earnings are affected by changes in interest rates. HDFS utilizes interest rate swaps to reduce the impact of fluctuations in interest rates on its unsecured commercial paper by converting a portion from a floating rate basis to a fixed rate basis. HDFS also entered into derivative contracts to facilitate its first quarter 2008 term asset-backed securitization transaction. These derivatives, which hedge assets held by a VIE, did not qualify for hedge accounting treatment and expired during 2011. The fair value of HDFS’s interest rate swaps is determined using pricing models that incorporate quoted prices for similar assets and observable inputs such as interest rates and yield curves. Fair value is determined using Level 2 inputs.

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The following table summarizes the fair value of the Company’s derivative financial instruments (in thousands):

	April 1, 2012						December 31, 2011						March 27, 2011
Derivatives Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Foreign currency contracts(c)	$	219,484	$	6,345	$	—	$	306,450	$	16,443	$	1,852	$	300,455	$	—	$	18,675
Natural gas contracts(c)		918		—		262		3,915		—		265		3,165		—		26
Interest rate swaps - unsecured commercial paper(c)		95,100		—		1,972		102,100		—		3,020		126,000		—		6,068
Total	$	315,502	$	6,345	$	2,234	$	412,465	$	16,443	$	5,137	$	429,620	$	—	$	24,769
	April 1, 2012						December 31, 2011						March 27, 2011
Derivatives Not Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair Value(a)		Liability Fair Value(b)		Notional Value		Asset Fair Value(a)		Liability Fair Value(b)		Notional Value		Asset Fair Value(a)		Liability Fair Value(b)
Derivatives - securitization transactions	$	—	$	—	$	—	$	—	$	—	$	—	$	17,723	$	18	$	18
	$	—	$	—	$	—	$	—	$	—	$	—	$	17,723	$	18	$	18

(a) Included in other current assets

(b) Included in accrued liabilities

(c) Derivative designated as a cash flow hedge

The following tables summarize the amount of gains and losses related to derivative financial instruments designated as cash flow hedges (in thousands):

	Amount of Gain/(Loss) Recognized in OCI
	Three months ended
Cash Flow Hedges	April 1, 2012			March 27, 2011
Foreign currency contracts	$	(6,215	)	$	(10,161	)
Natural gas contracts		(315	)		(37	)
Interest rate swaps - unsecured commercial paper		(15	)		(8	)
Total	$	(6,545	)	$	(10,206	)

	Amount of Gain/(Loss) Reclassified from AOCI into Income
	Three months ended						Expected to be Reclassified
Cash Flow Hedges	April 1, 2012			March 27, 2011			Over the Next Twelve Months
Foreign currency contracts(a)	$	2,421		$	(6,007	)	$	(4,535	)
Natural gas contracts(a)		(318	)		(258	)		262
Interest rate swaps - unsecured commercial paper(b)		(967	)		(1,350	)		(1,886	)
Total	$	1,136		$	(7,615	)	$	(6,159	)

(a) Gain/(loss) reclassified from accumulated other comprehensive income (AOCI) to income is included in cost of goods sold.

(b) Gain/(loss) reclassified from AOCI to income is included in financial services interest expense.

For the three months ended April 1, 2012 and March 27, 2011, the cash flow hedges were highly effective and, as a result, the amount of hedge ineffectiveness was not material. No amounts were excluded from effectiveness testing.

For the three months ended April 1, 2012 and March 27, 2011, there were no gains or losses recognized in income related to derivative financial instruments designated as fair value hedges.

For the three months ended April 1, 2012 and March 27, 2011, there were no gains or losses recognized in income related to derivative financial instruments not designated as hedging instruments.

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The Company is exposed to credit loss risk in the event of non-performance by counterparties to these derivative financial instruments. Although no assurances can be given, the Company does not expect any of the counterparties to these derivative financial instruments to fail to meet its obligations. To manage credit loss risk, the Company selects counterparties based on credit ratings and, on a quarterly basis, evaluates each hedge’s net position relative to the counterparty’s ability to cover its position.

11. Income Taxes

The Company’s first quarter 2012 income tax rate was 35.3% compared to 34.8% for the same period last year. The first quarter of 2011 was favorably impacted by the Federal research and development credit that expired at the end of 2011.

12. Product Warranty and Safety Recall Campaigns

The Company currently provides a standard two-year limited warranty on all new motorcycles sold worldwide, except for Japan, where the Company currently provides a standard three-year limited warranty on all new motorcycles sold. In addition, the Company started offering a one-year warranty for Parts & Accessories (P&A) in 2012. The warranty coverage for the retail customer generally begins when the product is sold to a retail customer. The Company maintains reserves for future warranty claims using an estimated cost, which is based primarily on historical Company claim information. Additionally, the Company has from time to time initiated certain voluntary safety recall campaigns. The Company reserves for all estimated costs associated with safety recalls in the period that the safety recalls are announced.

Changes in the Company’s warranty and safety recall liability were as follows (in thousands):

	Three months ended
	April 1, 2012			March 27, 2011
Balance, beginning of period	$	54,994		$	54,134
Warranties issued during the period		14,912			11,225
Settlements made during the period		(13,958	)		(10,296	)
Recalls and changes to pre-existing warranty liabilities		1,154			2,048
Balance, end of period	$	57,102		$	57,111

The liability for safety recall campaigns was $8.0 million and $3.4 million as of April 1, 2012 and March 27, 2011, respectively.

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13. Earnings Per Share

The following table sets forth the computation for basic and diluted earnings per share from continuing operations (in thousands, except per share amounts):

	Three months ended
	April 1, 2012		March 27, 2011
Numerator:
Income from continuing operations used in computing basic and diluted earnings per share	$	172,035	$	119,260
Denominator:
Denominator for basic earnings per share-weighted-average common shares		228,988		233,820
Effect of dilutive securities - employee stock compensation plan		2,296		2,083
Denominator for diluted earnings per share-adjusted weighted-average shares outstanding		231,284		235,903
Earnings per common share from continuing operations:
Basic	$	0.75	$	0.51
Diluted	$	0.74	$	0.51

Outstanding options to purchase 2.4 million and 3.3 million shares of common stock for the three months ended April 1, 2012 and March 27, 2011, respectively, were not included in the Company’s computation of dilutive securities because the exercise price was greater than the market price and therefore the effect would have been anti-dilutive.

The Company has a share-based compensation plan under which employees may be granted share-based awards including shares of restricted stock and restricted stock units (RSUs). Non-forfeitable dividends are paid on unvested shares of restricted stock and non-forfeitable dividend equivalents are paid on unvested RSUs. As such, shares of restricted stock and RSUs are considered participating securities under the two-class method of calculating earnings per share as described in ASC Topic 260, “Earnings per Share.” The two-class method of calculating earnings per share did not have a material impact on the Company’s earnings per share calculation as of April 1, 2012 and March 27, 2011.

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14. Employee Benefit Plans

The Company has defined benefit pension plans and postretirement healthcare benefit plans, which cover substantially all employees of the Motorcycles segment. The Company also has unfunded supplemental employee retirement plan agreements (SERPA) with certain employees which were instituted to replace benefits lost under the Tax Revenue Reconciliation Act of 1993. Components of net periodic benefit costs were as follows (in thousands):

	Three months ended
	April 1, 2012			March 27, 2011
Pension and SERPA Benefits
Service cost	$	8,420		$	9,273
Interest cost		20,816			20,147
Expected return on plan assets		(29,277	)		(26,653	)
Amortization of unrecognized:
Prior service cost		740			745
Net loss		10,969			7,554
Curtailment loss		—			236
Net periodic benefit cost	$	11,668		$	11,302
Postretirement Healthcare Benefits
Service cost	$	1,853		$	1,907
Interest cost		4,578			4,911
Expected return on plan assets		(2,356	)		(2,346	)
Amortization of unrecognized:
Prior service credit		(963	)		(969	)
Net loss		1,855			1,798
Net periodic benefit cost	$	4,967		$	5,301

The 2011 Restructuring Plan action resulted in a pension plan curtailment loss of $0.2 million, which is included in restructuring expense for the three months ended March 27, 2011. The curtailment loss also resulted in a pension plan remeasurement during the first quarter of 2011 using a discount rate of 5.76% and a postretirement healthcare plan remeasurement using a discount rate of 5.30%. At December 31, 2010, the discount rates used to measure the pension plans and the postretirement healthcare plans were 5.79% and 5.28%, respectively. As a result of the remeasurements, the Company recognized a funded status adjustment consisting of a $0.9 million decrease to its pension and postretirement healthcare liabilities and an increase to other comprehensive income of $0.9 million, or $0.5 million net of tax.

During the first quarter of 2012, the Company voluntarily contributed $200.0 million in cash to further fund its pension plans. No additional pension contributions are required in 2012. The Company also voluntarily contributed $200.0 million in cash to further fund its pension plans during the first quarter of 2011. The Company expects it will continue to make on-going contributions related to current benefit payments for SERPA and postretirement healthcare plans.

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15. Business Segments

The Company operates in two business segments: Motorcycles and Financial Services. The Company’s reportable segments are strategic business units that offer different products and services. They are managed separately based on the fundamental differences in their operations. Selected segment information is set forth below (in thousands):

	Three months ended
	April 1, 2012		March 27, 2011
Motorcycles net revenue	$	1,273,369	$	1,063,044
Gross profit		456,510		351,866
Selling, administrative and engineering expense		236,995		203,805
Restructuring expense		11,451		22,999
Operating income from Motorcycles		208,064		125,062
Financial services income		156,322		161,886
Financial services expense		88,928		93,951
Operating income from Financial Services		67,394		67,935
Operating income	$	275,458	$	192,997

16. Commitment and Contingencies

The Company is subject to lawsuits and other claims related to environmental, product and other matters. In determining required reserves related to these items, the Company carefully analyzes cases and considers the likelihood of adverse judgments or outcomes, as well as the potential range of possible loss. The required reserves are monitored on an ongoing basis and are updated based on new developments or new information in each matter.

Environmental Protection Agency Notice

In December 2009, the Company received formal, written requests for information from the United States Environmental Protection Agency (EPA) regarding: (i) certificates of conformity for motorcycle emissions and related designations and labels, (ii) aftermarket parts, and (iii) warranty claims on emissions related components. The Company promptly submitted written responses to the EPA’s inquiry and engaged in discussions with the EPA. It is possible that a result of the EPA’s investigation will be some form of enforcement action by the EPA that will seek a fine or other relief. However, at this time the Company does not know and cannot reasonably estimate the impact of any remedies the EPA might seek.

York Environmental Matters:

The Company is involved with government agencies and groups of potentially responsible parties in various environmental matters, including a matter involving the cleanup of soil and groundwater contamination at its York, Pennsylvania facility. The York facility was formerly used by the U.S. Navy and AMF prior to the purchase of the York facility by the Company from AMF in 1981. Although the Company is not certain as to the full extent of the environmental contamination at the York facility, it has been working with the Pennsylvania Department of Environmental Protection (PADEP) since 1986 in undertaking environmental investigation and remediation activities, including an ongoing site-wide remedial investigation/feasibility study (RI/FS). In January 1995, the Company entered into a settlement agreement (the Agreement) with the Navy. The Agreement calls for the Navy and the Company to contribute amounts into a trust equal to 53% and 47%, respectively, of future costs associated with environmental investigation and remediation activities at the York facility (Response Costs). The trust administers the payment of the Response Costs incurred at the York facility as covered by the Agreement.

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In February 2002, the Company was advised by the EPA that it considers some of the Company’s remediation activities at the York facility to be subject to the EPA’s corrective action program under the Resource Conservation and Recovery Act (RCRA) and offered the Company the option of addressing corrective action under a RCRA facility lead agreement. In July 2005, the York facility was designated as the first site in Pennsylvania to be addressed under the “One Cleanup Program.” The program provides a more streamlined and efficient oversight of voluntary remediation by both PADEP and EPA and will be carried out consistent with the Agreement with the Navy. As a result, the RCRA facility lead agreement has been superseded.

The Company estimates that its share of the future Response Costs at the York facility will be approximately $3.3 million and has established a reserve for this amount which is included in accrued liabilities in the Condensed Consolidated Balance Sheets. As noted above, the RI/FS is still underway and given the uncertainty that exists concerning the nature and scope of additional environmental investigation and remediation that may ultimately be required under the RI/FS or otherwise at the York facility, we are unable to make a reasonable estimate of those additional costs, if any, that may result.

The estimate of the Company’s future Response Costs that will be incurred at the York facility is based on reports of independent environmental consultants retained by the Company, the actual costs incurred to date and the estimated costs to complete the necessary investigation and remediation activities. Response Costs related to the remediation of soil are expected to be incurred primarily over a period of several years ending in 2015. Response Costs related to ground water remediation may continue for some time beyond 2015.

Product Liability Matters:

Additionally, the Company is involved in product liability suits related to the operation of its business. The Company accrues for claim exposures that are probable of occurrence and can be reasonably estimated. The Company also maintains insurance coverage for product liability exposures. The Company believes that its accruals and insurance coverage are adequate and that product liability will not have a material adverse effect on the Company’s consolidated financial statements.

17. Supplemental Consolidating Data

The supplemental consolidating data for the periods noted is presented for informational purposes. The supplemental consolidating data may be different than segment information presented elsewhere due to the allocation of intercompany eliminations to reporting segments. All supplemental data is presented in thousands.

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	Three months ended April 1, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,275,783	$	—	$	(2,414	)	$	1,273,369
Financial services		—		155,906		416			156,322
Total revenue		1,275,783		155,906		(1,998	)		1,429,691
Costs and expenses:
Motorcycles and related products cost of goods sold		816,859		—		—			816,859
Financial services interest expense		—		51,256		—			51,256
Financial services provision for credit losses		—		9,014		—			9,014
Selling, administrative and engineering expense		236,579		31,072		(1,998	)		265,653
Restructuring expense		11,451		—		—			11,451
Total costs and expenses		1,064,889		91,342		(1,998	)		1,154,233
Operating income		210,894		64,564		—			275,458
Investment income		226,933		—		(225,000	)		1,933
Interest expense		11,495		—		—			11,495
Income before provision for income taxes		426,332		64,564		(225,000	)		265,896
Provision for income taxes		70,618		23,243		—			93,861
Income from continuing operations		355,714		41,321		(225,000	)		172,035
Loss from discontinued operations, net of tax		—		—		—			—
Net income	$	355,714	$	41,321	$	(225,000	)	$	172,035
	Three months ended March 27, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,065,490	$	—	$	(2,446	)	$	1,063,044
Financial services		—		161,752		134			161,886
Total revenue		1,065,490		161,752		(2,312	)		1,224,930
Costs and expenses:
Motorcycles and related products cost of goods sold		711,178		—		—			711,178
Financial services interest expense		—		58,035		—			58,035
Financial services provision for credit losses		—		5,606		—			5,606
Selling, administrative and engineering expense		203,671		32,756		(2,312	)		234,115
Restructuring expense		22,999		—		—			22,999
Total costs and expenses		937,848		96,397		(2,312	)		1,031,933
Operating income		127,642		65,355		—			192,997
Investment income		126,398		—		(125,000	)		1,398
Interest expense		11,481		—		—			11,481
Income before provision for income taxes		242,559		65,355		(125,000	)		182,914
Provision for income taxes		40,126		23,528		—			63,654
Income from continuing operations		202,433		41,827		(125,000	)		119,260
Loss from discontinued operations, net of tax		—		—		—			—
Net income	$	202,433	$	41,827	$	(125,000	)	$	119,260

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	April 1, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	929,028	$	347,309	$	—		$	1,276,337
Marketable securities		134,946		—		—			134,946
Accounts receivable, net		581,569		—		(317,297	)		264,272
Finance receivables, net		—		1,339,139		—			1,339,139
Restricted finance receivables held by variable interest entities, net		—		546,350		—			546,350
Inventories		467,941		—		—			467,941
Restricted cash held by variable interest entities		—		246,995		—			246,995
Other current assets		174,053		63,497		—			237,550
Total current assets		2,287,537		2,543,290		(317,297	)		4,513,530
Finance receivables, net		—		2,020,036		—			2,020,036
Restricted finance receivables held by variable interest entities, net		—		1,971,878		—			1,971,878
Property, plant and equipment, net		761,191		29,873		—			791,064
Goodwill		29,740		—		—			29,740
Other long-term assets		336,167		15,970		(73,038	)		279,099
	$	3,414,635	$	6,581,047	$	(390,335	)	$	9,605,347
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	280,738	$	392,461	$	(317,297	)	$	355,902
Accrued liabilities		478,227		102,722		(3,330	)		577,619
Short-term debt		—		629,143		—			629,143
Current portion of long-term debt		—		399,939					399,939
Current portion of long-term debt held by variable interest entities		—		620,624		—			620,624
Total current liabilities		758,965		2,144,889		(320,627	)		2,583,227
Long-term debt		303,000		2,481,688		—			2,784,688
Long-term debt held by variable interest entities		—		1,133,696		—			1,133,696
Pension liability		118,212		—		—			118,212
Postretirement healthcare benefits		265,871		—		—			265,871
Other long-term liabilities		130,278		14,716		—			144,994
Commitments and contingencies (Note 16)
Total shareholders’ equity		1,838,309		806,058		(69,708	)		2,574,659
	$	3,414,635	$	6,581,047	$	(390,335	)	$	9,605,347

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	December 31, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	943,330	$	583,620	$	—		$	1,526,950
Marketable securities		153,380		—		—			153,380
Accounts receivable, net		393,615		—		(174,576	)		219,039
Finance receivables, net		—		1,168,603		—			1,168,603
Restricted finance receivables held by variable interest entities, net		—		591,864		—			591,864
Inventories		418,006		—		—			418,006
Restricted cash held by variable interest entities		—		229,655		—			229,655
Other current assets		167,423		67,286		—			234,709
Total current assets		2,075,754		2,641,028		(174,576	)		4,542,206
Finance receivables, net		—		1,754,441		—			1,754,441
Restricted finance receivables held by variable interest entities, net		—		2,271,773		—			2,271,773
Property, plant and equipment, net		779,330		30,129		—			809,459
Goodwill		29,081		—		—			29,081
Other long-term assets		322,379		17,460		(72,635	)		267,204
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	220,957	$	209,332	$	(174,576	)	$	255,713
Accrued liabilities		482,838		85,038		(3,704	)		564,172
Short-term debt		—		838,486		—			838,486
Current portion of long-term debt		—		399,916					399,916
Current portion of long-term debt held by variable interest entities		—		640,331		—			640,331
Total current liabilities		703,795		2,173,103		(178,280	)		2,698,618
Long-term debt		303,000		2,093,871		—			2,396,871
Long-term debt held by variable interest entities		—		1,447,015		—			1,447,015
Pension liability		302,483		—		—			302,483
Postretirement healthcare benefits		268,582		—		—			268,582
Other long-term liabilities		126,036		14,303		—			140,339
Commitments and contingencies (Note 16)
Total shareholders’ equity		1,502,648		986,539		(68,931	)		2,420,256
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164

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	March 27, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	663,026	$	269,489	$	—		$	932,515
Marketable securities		115,209		—		—			115,209
Accounts receivable, net		630,437		—		(332,766	)		297,671
Finance receivables, net		—		1,276,780		—			1,276,780
Restricted finance receivables held by variable interest entities, net		—		637,760		—			637,760
Inventories		372,323		—		—			372,323
Restricted cash held by variable interest entities		—		294,903		—			294,903
Other current assets		172,062		71,365		—			243,427
Total current assets		1,953,057		2,550,297		(332,766	)		4,170,588
Finance receivables, net		—		1,806,563		—			1,806,563
Restricted finance receivables held by variable interest entities, net		—		2,304,320		—			2,304,320
Property, plant and equipment, net		769,480		29,611		—			799,091
Goodwill		30,988		—		—			30,988
Other long-term assets		336,759		26,701		(69,868	)		293,592
	$	3,090,284	$	6,717,492	$	(402,634	)	$	9,405,142
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	246,746	$	378,696	$	(332,766	)	$	292,676
Accrued liabilities		493,896		89,253		(3,066	)		580,083
Short-term debt		—		393,393		—			393,393
Current portion of long-term debt held by variable interest entities		—		721,179		—			721,179
Total current liabilities		740,642		1,582,521		(335,832	)		1,987,331
Long-term debt		303,000		2,660,375		—			2,963,375
Long-term debt held by variable interest entities		—		1,603,584		—			1,603,584
Pension liability		99,627		—		—			99,627
Postretirement healthcare liability		254,505		—		—			254,505
Other long-term liabilities		145,739		10,733		—			156,472
Commitments and contingencies (Note 16)
Total shareholders’ equity		1,546,771		860,279		(66,802	)		2,340,248
	$	3,090,284	$	6,717,492	$	(402,634	)	$	9,405,142

34

	Three months ended April 1, 2012
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Income from continuing operations	$	355,714		$	41,321		$	(225,000	)	$	172,035
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation		41,708			1,495			—			43,203
Amortization of deferred loan origination costs		—			18,547			—			18,547
Amortization of financing origination fees		118			2,625			—			2,743
Provision for employee long-term benefits		16,780			513			—			17,293
Contributions to pension and postretirement plans		(206,832	)		—			—			(206,832	)
Stock compensation expense		10,967			777			—			11,744
Net change in wholesale finance receivables		—			—			(151,046	)		(151,046	)
Provision for credit losses		—			9,014			—			9,014
Pension and postretirement healthcare plan curtailment and settlement expense		—			—			—			—
Foreign currency adjustments		(2,911	)		—			—			(2,911	)
Other, net		(1,954	)		3,459			—			1,505
Change in current assets and current liabilities:
Accounts receivable		(186,466	)		—			142,721			(43,745	)
Finance receivables - accrued interest and other		—			3,299			—			3,299
Inventories		(47,168	)		—			—			(47,168	)
Accounts payable and accrued liabilities		57,993			202,188			(142,721	)		117,460
Restructuring reserves		1,296			—			—			1,296
Derivative instruments		(390	)		(96	)		—			(486	)
Other		(18,058	)		(1,509	)		—			(19,567	)
Total adjustments		(334,917	)		240,312			(151,046	)		(245,651	)
Net cash provided by operating activities of continuing operations		20,797			281,633			(376,046	)		(73,616	)
Cash flows from investing activities of continuing operations:
Capital expenditures		(23,441	)		(1,239	)		—			(24,680	)
Origination of finance receivables		—			(1,617,867	)		972,620			(645,247	)
Collections of finance receivables		—			1,503,478			(821,574	)		681,904
Sales and redemptions of marketable securities		20,042			—			—			20,042
Net cash (used by) provided by investing activities of continuing operations		(3,399	)		(115,628	)		151,046			32,019
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		—			397,377			—			397,377
Repayments of securitization debt		—			(333,026	)		—			(333,026	)
Net borrowings of unsecured commercial paper		—			(211,669	)		—			(211,669	)
Net decrease in credit facilities		—			(12,839	)		—			(12,839	)
Net change in restricted cash		—			(17,340	)		—			(17,340	)
Dividends paid		(35,943	)		(225,000	)		225,000			(35,943	)
Purchase of common stock for treasury		(20,745	)		—			—			(20,745	)
Excess tax benefits from share based payments		7,962			—			—			7,962
Issuance of common stock under employee stock option plans		16,281			—			—			16,281
Net cash used by financing activities of continuing operations		(32,445	)		(402,497	)		225,000			(209,942	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		745			181			—			926
Net (decrease) increase in cash and cash equivalents of continuing operations		(14,302	)		(236,311	)		—			(250,613	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		—			—			—			—
Cash flows from investing activities of discontinued operations		—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—			—			—
		—			—			—			—
Net (decrease) increase in cash and cash equivalents	$	(14,302	)	$	(236,311	)	$	—		$	(250,613	)
Cash and cash equivalents:
Cash and cash equivalents - beginning of period	$	943,330		$	583,620		$	—		$	1,526,950
Cash and cash equivalents of discontinued operations - beginning of period		—			—			—			—
Net (decrease) increase in cash and cash equivalents		(14,302	)		(236,311	)		—			(250,613	)
Less: Cash and cash equivalents of discontinued operations - end of period		—			—			—			—
Cash and cash equivalents - end of period	$	929,028		$	347,309		$	—		$	1,276,337

35

	Three months ended March 27, 2011
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Income from continuing operations	$	202,433		$	41,827		$	(125,000	)	$	119,260
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation		41,340			1,607			—			42,947
Amortization of deferred loan origination costs		—			19,329			—			19,329
Amortization of financing origination fees		118			2,989			—			3,107
Provision for employee long-term benefits		16,445			(882	)		—			15,563
Contributions to pension and postretirement plans		(204,816	)		—			—			(204,816	)
Stock compensation expense		8,481			672			—			9,153
Net change in wholesale finance receivables		—			—			(163,967	)		(163,967	)
Provision for credit losses		—			5,606			—			5,606
Pension and postretirement healthcare plan curtailment and settlement expense		236			—			—			236
Foreign currency adjustments		29			—			—			29
Other, net		1,884			12,228			—			14,112
Change in current assets and current liabilities:
Accounts receivable		(167,885	)		—			140,837			(27,048	)
Finance receivables - accrued interest and other		—			3,542			—			3,542
Inventories		(38,200	)		—			—			(38,200	)
Accounts payable and accrued liabilities		39,517			152,692			(93,249	)		98,960
Restructuring reserves		7,757			—			—			7,757
Derivative instruments		2,178			(21	)		—			2,157
Other		(12,706	)		47,636			(47,575	)		(12,645	)
Total adjustments		(305,622	)		245,398			(163,954	)		(224,178	)
Net cash (used by) provided by operating activities of continuing operations		(103,189	)		287,225			(288,954	)		(104,918	)
Cash flows from investing activities of continuing operations:
Capital expenditures		(26,460	)		(1,244	)		—			(27,704	)
Origination of finance receivables		—			(1,406,139	)		856,939			(549,200	)
Collections of finance receivables		—			1,369,924			(692,972	)		676,952
Purchases of marketable securities		(5,000	)		—			—			(5,000	)
Sales and redemptions of marketable securities		29,974			—			—			29,974
Net cash (used by) provided by investing activities of continuing operations		(1,486	)		(37,459	)		163,967			125,022
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		—			447,076			—			447,076
Repayments of securitization debt		—			(430,471	)		—			(430,471	)
Net decrease in credit facilities and unsecured commercial paper		—			(96,174	)		—			(96,174	)
Net change in restricted cash		—			(6,016	)		—			(6,016	)
Dividends paid		(23,643	)		(125,000	)		125,000			(23,643	)
Purchase of common stock for treasury		(4,699	)		—			—			(4,699	)
Excess tax benefits from share based payments		3,262			—			—			3,262
Issuance of common stock under employee stock option plans		3,861			—			—			3,861
Net cash used by financing activities of continuing operations		(21,219	)		(210,585	)		125,000			(106,804	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		(2,846	)		166			(13	)		(2,693	)
Net (decrease) increase in cash and cash equivalents of continuing operations		(128,740	)		39,347			—			(89,393	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		(25	)		—			—			(25	)
Cash flows from investing activities of discontinued operations		—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—			—			—
		(25	)		—			—			(25	)
Net (decrease) increase in cash and cash equivalents	$	(128,765	)	$	39,347		$	—		$	(89,418	)
Cash and cash equivalents:
Cash and cash equivalents - beginning of period	$	791,791		$	230,142		$	—		$	1,021,933
Cash and cash equivalents of discontinued operations - beginning of period		—			—			—			—
Net (decrease) increase in cash and cash equivalents		(128,765	)		39,347			—			(89,418	)
Less: Cash and cash equivalents of discontinued operations - end of period		—			—			—			—
Cash and cash equivalents - end of period	$	663,026		$	269,489		$	—		$	932,515

36

18. Subsequent Event

On April 13, 2012, the Company and HDFS entered into a new five-year credit facility totaling $675.0 million. This facility replaces the existing $675.0 million three-year facility that was due to mature in April 2013.

37

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Harley-Davidson, Inc. is the parent company of the groups of companies doing business as Harley-Davidson Motor Company (HDMC) and Harley-Davidson Financial Services (HDFS). HDMC produces heavyweight cruiser and touring motorcycles. HDMC manufactures five families of motorcycles: Touring, Dyna^®, Softail^®, Sportster^® and V-Rod^®. HDFS provides wholesale and retail financing and insurance programs primarily to Harley-Davidson dealers and customers.

The Company operates in two business segments: Motorcycles & Related Products (Motorcycles) and Financial Services (Financial Services). The Company’s reportable segments are strategic business units that offer different products and services. They are managed separately based on the fundamental differences in their operations.

The “% Change” figures included in the “Results of Operations” section were calculated using unrounded dollar amounts and may differ from calculations using the rounded dollar amounts presented.

Overview

The Company’s income from continuing operations was $172.0 million, or $0.74 per share, for the first quarter of 2012 compared to $119.3 million, or $0.51 per share, in the first quarter of 2011. The increase in income from continuing operations was driven by strong financial performance in the Motorcycles segment. Operating income from the Motorcycles segment was up $83.0 million over last year’s first quarter on a 19.4% increase in wholesale shipments of Harley-Davidson motorcycles, a higher gross margin percentage and lower restructuring costs, partially offset by higher selling and administrative expenses. Operating income from the Financial Services segment was $67.4 million compared to $67.9 million in the year-ago quarter benefiting from increased net interest margin and continued credit performance improvement offset by a significant release in the allowance for credit losses in the first quarter of 2011.

In the first quarter of 2012, worldwide independent dealer retail sales of new Harley-Davidson motorcycles grew 20.3% compared to 2011, including a 25.5% increase in the U.S. and an 11.2% increase in international markets. The Company believes the solid improvement in retail sales of new Harley-Davidson motorcycles reflects strong affinity for the Harley-Davidson brand, the appeal of its 2012 model-year motorcycles and improving macro-economic conditions. In addition, the Company believes that unusually mild weather in the first quarter of 2012 in the United States encouraged early sales to some customers who may have otherwise purchased later in the spring season.

Please refer to the “Results of Operations for the Three Months Ended April 1, 2012” for additional details concerning the results.

(1) Note Regarding Forward-Looking Statements

The Company intends that certain matters discussed in this report are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such by reference to this footnote or because the context of the statement will include words such as the Company “believes,” “anticipates,” “expects,” “plans,” or “estimates” or words of similar meaning. Similarly, statements that describe future plans, objectives, outlooks, targets, guidance or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated as of the date of this report. Certain of such risks and uncertainties are described in close proximity to such statements or elsewhere in this report, including under the caption “Cautionary Statements” and in Item 1A “Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2011. Shareholders, potential investors, and other readers are urged to consider these factors in evaluating the forward-looking statements and cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this report are made only as of the date of the filing of this report (May 10, 2012), and the Company disclaims any obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

38

Outlook⁽¹⁾

On April 25, 2012, the Company increased its motorcycle shipment expectation and now expects to ship 245,000 to 250,000 Harley-Davidson motorcycles to dealers and distributors worldwide in 2012. The Company’s previous expectation was to ship 240,000 to 245,000 Harley-Davidson motorcycles during 2012. The revised full-year 2012 shipment estimate takes into account strong consumer demand, slightly improved capacity at its York, PA facility (York) and increased production at its Kansas City, MO facility. In the U.S., the Company continues to expect dealers to retail more units than it expects to ship in 2012, resulting in lower year-end retail inventory at dealers during the winter selling season. As previously disclosed, beginning in early 2013, the Company expects to implement flexible production capabilities at York by adding flexible workers thus enabling the Company to increase capacity in the first half of 2013 to more closely match retail demand. The Company expects to achieve the ability to maximize flexibility in the entire manufacturing system during 2014 when it expects that the same capability will be in place for the Kansas City and Wisconsin operations.

In addition, on April 25, 2012 the Company announced that its full-year shipments estimate include expected shipments of 79,000 to 84,000 motorcycles in the second quarter of 2012. The Company’s second quarter planned shipments are expected to significantly reduce its 2012 model-year motorcycle inventory during the second quarter in advance the Company’s implementation of a new enterprise resource planning (ERP) system at York, which is now planned for July 2012 (as discussed below) and the 2013 model year cut-over expected to occur in July 2012.

Also on April 25, 2012, the Company announced that it continues to expect 2012 full-year gross margin to be between 34.75% and 35.75%. The Company expects gross margin will be positively impacted by incremental restructuring savings, increased productivity from continuous improvement opportunities and the 2012 model year pricing actions announced in July 2011. The Company believes that raw material surcharges and temporary inefficiencies resulting from restructuring activities will be comparable to 2011 levels. The Company expects currency to be a headwind in the remainder of 2012 and now expects product mix will be slightly unfavorable for the full year. For the remaining quarters of 2012, the Company expects second quarter gross margin percentage to be level to slightly down from the first quarter of 2012 and third and fourth quarter gross margin percentages to be down from first half levels. The changes in quarterly gross margin percentages are driven by many factors including changes in production volumes. The Company expects production volumes, relative to the first quarter, to be lower in the second quarter due to fewer production days, lower in the third quarter due to the ERP implementation downtime and lower in the fourth quarter given the new capability to flex production that we expect to have in place in York beginning in the first half of 2013, fewer production days and a reduction of company-owned inventory.

The Company also announced that it continues to expect its full-year 2012 effective tax rate from continuing operations to be approximately 35.5%. This guidance excludes the effect of any potential future nonrecurring adjustments such as changes in tax legislation or audit settlements which are recorded as discrete items in the period in which they are settled.

Finally, on April 25, 2012, the Company announced that it continues to expect full-year capital expenditures of between $190 million and $210 million. However, the Company increased the portion of expected capital expenditures dedicated to support restructuring-related activities to approximately $35 million for 2012, compared to the previous estimate of approximately $25 million.

The increase in capital for restructuring-related activities was due to a change in the timing of the ERP implementation at York. The Company had previously expected to launch the ERP implementation in the second quarter of 2012. However, the Company’s extensive systems tests conducted during the first quarter uncovered opportunities to further improve the design of the system. As a result, the Company adjusted the expected timing of the implementation to July 2012.

The adjusted implementation timing will allow the Company to continue to produce motorcycles without the ERP production disruption during the height of its spring selling season. The adjusted timing is expected to slightly reduce the expected downtime during the launch. In addition, the July ERP system launch will sync-up with the start-up of the 2013 model-year motorcycle production, which provides for a more efficient use of the normal transition period to the new model year.

39

Restructuring Activities⁽¹⁾

2011 Restructuring Plan

In December 2011, the Company made a decision to cease operations at New Castalloy, its Australian subsidiary and producer of cast motorcycle wheels and wheel hubs, and source those components through other existing suppliers. The Company expects the transition of supply from New Castalloy to be complete by mid-2013. The decision to close New Castalloy comes as part of the Company’s overall long term strategy to develop world-class manufacturing capability throughout the Company by restructuring and consolidating operations for greater competitiveness, efficiency and flexibility. In connection with this decision, the Company will reduce its workforce by approximately 200 employees by mid-2013.

In February 2011, the Company’s unionized employees at its facility in Kansas City, Missouri ratified a new seven-year labor agreement. The new agreement took effect on August 1, 2011. The new contract is similar to the labor agreements ratified at the Company’s Wisconsin facilities in September 2010 and its York, Pennsylvania facility in December 2009, and allows for similar flexibility and increased production efficiency. Once the new contract is fully implemented, the production system in Kansas City, like Wisconsin and York, will include the addition of a flexible workforce component.

After taking actions to fully implement the new ratified labor agreement, the Company expects to have about 145 fewer full-time hourly unionized employees in its Kansas City facility than would be required under the prior contract.

2010 Restructuring Plan

In September 2010, the Company’s unionized employees in Wisconsin ratified three separate new seven-year labor agreements which took effect in April 2012 when the prior contracts expired. The new contracts are similar to the labor agreement ratified at the Company’s York, Pennsylvania facility in December 2009 and allow for similar flexibility and increased production efficiency. Once the new contracts are fully implemented, the production system in Wisconsin, like York, will include the addition of a flexible workforce component.

Based on the new ratified labor agreements, the Company expects to have about 250 fewer full-time hourly unionized employees in its Milwaukee-area facilities when the contracts are fully implemented in 2012 than would be required under the previous contract. In Tomahawk, the Company expects to have about 75 fewer full-time hourly unionized employees when the contract is fully implemented than would be required under the previous contract.

2009 Restructuring Plan

During 2009, in response to the U.S. economic recession and worldwide slowdown in consumer demand, the Company committed to a volume reduction and a combination of restructuring actions that are expected to be completed at various dates between 2009 and 2012. The actions were designed to reduce administrative costs, eliminate excess capacity and exit non-core business operations. The Company’s significant announced actions include the restructuring and transformation of its York, Pennsylvania production facility including the implementation of a new more flexible unionized labor agreement; consolidation of facilities related to engine and transmission production; outsourcing of certain distribution and transportation activities and exiting the Buell product line.

The 2009 restructuring plans included a reduction of approximately 2,700 to 2,900 hourly production positions and approximately 720 non-production, primarily salaried positions within the Motorcycles segment and approximately 100 salaried positions in the Financial Services segment.

Restructuring Costs and Savings

During the first quarter of 2012, the Company incurred $11.5 million in restructuring expense related to its combined restructuring plan activities. This is in addition to $455.8 million in restructuring and impairment expense incurred in prior years since its restructuring activities were initiated in 2009. On April 25, 2012, the

40

Company re-affirmed its estimate for restructuring expenses related to its combined restructuring plan activities initiated since early 2009 at $500 million to $520 million from 2009 through 2013, and the Company expects approximately 35% of those amounts to be non-cash. The estimated restructuring expense include estimated restructuring expenses of $50 million to $60 million in 2012. The Company has realized or estimates that it will realize cumulative savings from these restructuring activities, measured against 2008, as follows:

• 2009 - $91 million (91% operating expense and 9% cost of sales) (actual);

• 2010 - $172 million (64% operating expense and 36% cost of sales) (actual);

• 2011 - $217 million (51% operating expense and 49% cost of sales) (actual);

• 2012 - $275 million to $295 million (35-45% operating expense and 55-65% cost of sales) (estimated);

• 2013 - $300 million to $320 million (30-40% operating expense and 60-70% cost of sales) (estimated); and

• Ongoing annually upon completion - $315 million to $335 million (30-40% operating expense and 60-70% cost of sales) (estimated).

Results of Operations for the Three Months Ended April 1, 2012

Compared to the Three Months Ended March 27, 2011

Consolidated Results

	Three months ended
(in thousands, except earnings per share)	April 1, 2012		March 27, 2011		(Decrease) Increase			% Change
Operating income from motorcycles & related products	$	208,064	$	125,062	$	83,002			66.4	%
Operating income from financial services		67,394		67,935		(541	)		(0.8	)
Operating income		275,458		192,997		82,461			42.7
Investment income		1,933		1,398		535			38.3
Interest expense		11,495		11,481		14			0.1
Income before income taxes		265,896		182,914		82,982			45.4
Provision for income taxes		93,861		63,654		30,207			47.5
Income from continuing operations		172,035		119,260		52,775			44.3
Loss from discontinued operations, net of income taxes		—		—		—			N/M
Net income	$	172,035	$	119,260	$	52,775			44.3	%
Diluted earnings per share from continuing operations	$	0.75	$	0.51	$	0.24			47.1	%
Diluted earnings per share from discontinued operations	$	—	$	—	$	—			N/M
Diluted earnings per share	$	0.74	$	0.51	$	0.23			45.1	%

Operating income for the Motorcycles segment during the first quarter of 2012 improved by $83.0 million compared to first quarter 2011. The increase was primarily due to increased motorcycle shipments, higher gross margin and favorable restructuring spending, partially offset by higher selling and administrative expenses. Operating income for the Financial Services segment was strong during the first quarter of 2012, but down slightly compared to the first quarter of 2011 when the Financial Services segment was favorably impacted by a $12.4 million release in the total (retail and wholesale combined) allowance for credit losses. This compares to a $3.2 million release in the total allowance for credit losses in the first quarter of 2012. Please refer to the “Motorcycles and Related Products Segment” and “Financial Services Segment” discussions following for a more detailed discussion of the factors affecting operating income.

41

The effective income tax rate for the first quarter of 2012 was 35.3% compared to 34.8% for the first quarter of 2011. The first quarter of 2011 was favorable affected by the Federal research and development benefits that expired at the end of 2011.

Motorcycles & Related Products Segment

Harley-Davidson Motorcycle Worldwide Retail Sales

Worldwide independent dealer retail sales of Harley-Davidson motorcycles increased 20.3% during the first quarter of 2012 compared to the first quarter of 2011. Retail sales of Harley-Davidson motorcycles increased 25.5% in the United States and 11.2% internationally in the quarter. On an industry-wide basis, the heavyweight (651+cc) portion of the market was up 17.5% in the United States and down 2.6% in Europe for the three months ended March 31, 2012 when compared to the same periods in 2011. The following table includes retail unit sales of Harley-Davidson motorcycles:

Harley-Davidson Motorcycle Worldwide Retail Sales^(a)

Heavyweight (651+cc)

	Three months ended
	April 1, 2012		March 27, 2011		(Decrease) Increase			% Change
North America Region
United States		39,762		31,691		8,071			25.5	%
Canada		2,067		2,037		30			1.5
Total North America Region		41,829		33,728		8,101			24.0
Europe, Middle East and Africa Region (EMEA)
Europe(b)		8,882		9,167		(285	)		(3.1	)
Other		1,412		1,246		166			13.3
Total EMEA Region		10,294		10,413		(119	)		(1.1	)
Asia Pacific Region
Japan		2,076		1,831		245			13.4
Other		3,267		2,429		838			34.5
Total Asia Pacific Region		5,343		4,260		1,083			25.4
Latin America Region		2,211		1,194		1,017			85.2
Total Worldwide Retail Sales		59,677		49,595		10,082			20.3	%

(a) Data source for retail sales figures shown above is new sales warranty and registration information provided by Harley-Davidson dealers and compiled by the Company. The Company must rely on information that its dealers supply concerning retail sales and this information is subject to revision. Only Harley-Davidson motorcycles are included in the table above.

(b) Europe data includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the United Kingdom.

42

The following table includes industry retail motorcycle registration data:

Heavyweight Motorcycle Registration Data^(a)

	Three months ended
	March 31, 2012		March 31, 2011		Increase			% Change
United States(b)		69,125		58,823		10,302			17.5	%
	Three months ended
	March 31, 2012		March 31, 2011		Decrease			% Change
Europe(c)		75,114		77,088		(1,974	)		-2.6	%

(a) Heavyweight data includes street legal 651+cc models. Street legal 651+cc models include on-highway, dual purpose models and three-wheeled vehicles.

(b) United States industry data is derived from information provided by Motorcycle Industry Council (MIC). This third party data is subject to revision and update.

(c) Europe data includes Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. Industry retail motorcycle registration data includes 651+cc models derived from information provided by Association des Constructeurs Europeens de Motocycles (ACEM), an independent agency. Europe market data is reported on a one-month lag. This third-party data is subject to revision and update.

Motorcycle Unit Shipments

The following table includes wholesale motorcycle unit shipments for the Motorcycles segment:

	Three months ended
	April 1, 2012				March 27, 2011				Increase		% Change
United States		41,293	64.3	%		34,866	64.8	%		6,427		18.4	%
International		22,970	35.7	%		18,961	35.2	%		4,009		21.1
Harley-Davidson motorcycle units		64,263	100.0	%		53,827	100.0	%		10,436		19.4	%
Touring motorcycle units		27,158	42.3	%		22,496	41.8	%		4,662		20.7	%
Custom motorcycle units(a)		24,572	38.2	%		20,670	38.4	%		3,902		18.9
Sportster motorcycle units		12,533	19.5	%		10,661	19.8	%		1,872		17.6
Harley-Davidson motorcycle units		64,263	100.0	%		53,827	100.0	%		10,436		19.4	%

(a) Custom motorcycle units, as used in this table, include Dyna, Softail, VRSC and CVO models.

The Company shipped 64,263 Harley-Davidson motorcycles worldwide during the first quarter of 2012, which was 19.4% higher than the first quarter of 2011. The shipment of 64,263 motorcycles was approximately 1,300 above the high end of the Company’s expected shipment guidance range as a result of higher than expected retail sales. The year-over-year increase in shipments was also aided by six additional calendar days included in the first quarter of 2012 compared to the first quarter of 2011. This adjustment is required every several years to sync up the Company’s fiscal calendar with the regular calendar. The fourth quarter of 2012 will include five

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fewer calendar days than last year’s fourth quarter. U.S. dealer inventory at the end of the first quarter of 2012 increased approximately 1,500 units over December 2011 in advance of the spring selling season; however, U.S. dealer inventory of new Harley-Davidson motorcycle units was approximately 4,400 lower than at the end of the year ago period. The Company announced on April 25, 2012 that it anticipates shipping between 79,000 to 84,000 Harley-Davidson motorcycle units in the second quarter of 2012.⁽¹⁾

Segment Results

The following table includes the condensed statements of operations for the Motorcycles segment (in thousands):

	Three months ended
	April 1, 2012		March 27, 2011		Increase (Decrease)			% Change
Revenue:
Motorcycles	$	995,902	$	833,501	$	162,401			19.5	%
Parts & Accessories		199,058		164,333		34,725			21.1
General Merchandise		74,606		62,566		12,040			19.2
Other		3,803		2,644		1,159			43.8
Total revenue		1,273,369		1,063,044		210,325			19.8
Cost of goods sold		816,859		711,178		105,681			14.9
Gross profit		456,510		351,866		104,644			29.7
Selling & administrative expense		206,993		173,254		33,739			19.5
Engineering expense		30,002		30,551		(549	)		(1.8	)
Restructuring expense		11,451		22,999		(11,548	)		(50.2	)
Operating expense		248,446		226,804		21,642			9.5
Operating income from motorcycles	$	208,064	$	125,062	$	83,002			66.4	%

The following table includes the estimated impact of significant factors affecting the comparability of net revenue, cost of goods sold and gross profit from the first quarter of 2011 to the first quarter of 2012 (in millions):

	Net Revenue			Cost of Goods Sold			Gross Profit
March 27, 2011	$	1,063.0		$	711.1		$	351.9
Volume		208.3			140.4			67.9
Price		8.5			—			8.5
Foreign currency exchange rates and hedging		(2.7	)		(13.6	)		10.9
Shipment mix		(3.8	)		(3.4	)		(0.4	)
Raw material prices		—			1.6			(1.6	)
Manufacturing costs		—			(19.3	)		19.3
Total		210.3			105.7			104.6
April 1, 2012	$	1,273.3		$	816.8		$	456.5

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• On average, wholesale prices on the Company’s 2012 model-year motorcycles are higher than the prior model year resulting in the favorable impact on revenue and gross profit during the period.

• Foreign currency exchange rates during the first quarter of 2012 resulted in a negative impact on net revenue. Gains and losses associated with foreign currency hedging (included in cost of goods sold) and the revaluation of foreign-denominated assets and liabilities were favorable when compared to the same period last year and more than offset the unfavorable impact of revenue.

• Shipment mix unfavorability was primarily driven by higher sales of Parts and Accessories and General Merchandise into international markets where margins are generally lower than domestic margins.

• Raw material prices were higher in the first quarter of 2012 relative to the first quarter of 2011 primarily due to increasing fuel costs and a slight increase in metal costs.

• Manufacturing costs benefitted from restructuring savings, incremental margin on higher volumes and lower year over year temporary inefficiencies related to restructuring, partially offset by inflation. Temporary inefficiencies related to restructuring activities were $7 million in the first quarter of 2012 and the Company expects temporary inefficiencies to be approximately $6 million to $9 million, $9 million to $14 million and $5 million to $8 million for the second, third and fourth quarters of 2012, respectively, for a total of approximately $32 million for 2012.⁽¹⁾

The net increase in operating expense was primarily due to higher selling and administrative expense driven by six more days in the first quarter of 2012 compared to the first quarter of 2011. The higher selling and administrative expenses were partially offset by lower restructuring expense related to the Company’s previously announced restructuring activities. For further information regarding the Company’s previously announced restructuring activities, refer to Note 5 of Notes to Condensed Consolidated Financial Statements.

Financial Services Segment

Segment Results

The following table includes the condensed statements of operations for the Financial Services segment (in thousands):

	Three months ended
	April 1, 2012		March 27, 2011		(Decrease) Increase			% Change
Interest income	$	143,979	$	149,425	$	(5,446	)		(3.6	%)
Other income		12,343		12,461		(118	)		(0.9	)
Financial services revenue		156,322		161,886		(5,564	)		(3.4	)
Interest expense		51,256		58,035		(6,779	)		(11.7	)
Provision for credit losses		9,014		5,606		3,408			60.8
Operating expenses		28,658		30,310		(1,652	)		(5.5	)
Financial services expense		88,928		93,951		(5,023	)		(5.3	)
Operating income from financial services	$	67,394	$	67,935	$	(541	)		(0.8	%)

Interest income for the three months ended April 1, 2012 decreased due to lower finance receivables outstanding primarily due to a declining portfolio of retail finance receivables as a result of lower U.S. retail motorcycle sales over the last few years. Interest expense was lower primarily due to a more favorable cost of funds.

The provision for credit losses related to retail motorcycle finance receivables increased by $6.6 million in the first quarter of 2012 compared to the first quarter of 2011. During the first quarter of 2011, the provision for retail credit losses was favorably impacted by a $12.7 million release in the allowance for retail credit losses.

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This compares to a $2.0 million release in the first quarter of 2012. The unfavorable impact resulting from a lower release in the allowance for retail losses was partially offset by favorable retail motorcycle finance receivable credit loss performance in the first quarter of 2012 as compared to the first quarter of 2011. The provision for credit losses related to wholesale motorcycle finance receivables decreased by $1.9 million during the first quarter of 2012 compared to the first quarter of 2011.

The Company believes that 2012 operating income from Financial Services will be lower than 2011. Lower net interest income is anticipated as the portfolio of retail finance receivables continues to contract. The Company expects a modest tightening of margins on prime tier retail lending due to a more competitive lending environment.⁽¹⁾ In addition, during 2011 releases in the allowance for credit losses totaled $40 million, and the Company does not anticipate a comparable amount of releases during 2012. ⁽¹⁾ Although the Company expects lower operating income in 2012 compared to 2011, it expects to continue to report positive operating income in 2012. ⁽¹⁾

Annualized losses on HDFS’ retail motorcycle loans were 1.00% during the first quarter of 2012 compared to 1.58% in the first quarter of 2011. The decrease in credit losses from 2011 was due to a lower frequency of loss. The 30-day delinquency rate for retail motorcycle loans at April 1, 2012 decreased to 2.56% from 3.68% at March 27, 2011.

Changes in the allowance for credit losses on finance receivables were as follows (in thousands):

	Three months ended
	April 1, 2012			March 27, 2011
Balance, beginning of period	$	125,449		$	173,589
Provision for finance credit losses		9,014			5,606
Charge-offs		(25,852	)		(35,191	)
Recoveries		13,892			15,680
Balance, end of period	$	122,503		$	159,684

At April 1, 2012, the allowance for credit losses on finance receivables was $9.6 million for wholesale receivables and $112.9 million for retail receivables, which includes $57.0 million related to finance receivables held by VIEs. See Note 7 of Notes to Condensed Consolidated Financial Statements for more information on the Company’s VIEs. At March 27, 2011, the allowance for credit losses on finance receivables was $18.0 million for wholesale receivables and $141.7 million for retail receivables, which includes $82.3 million related to receivables held by VIEs.

HDFS’ periodic evaluation of the adequacy of the allowance for credit losses on finance receivables is generally based on HDFS’ past loan loss experience, known and inherent risks in the portfolio, current economic conditions and the estimated value of any underlying collateral.

Other Matters

Commitments and Contingencies

The Company is subject to lawsuits and other claims related to environmental, product and other matters. In determining required reserves related to these items, the Company carefully analyzes cases and considers the likelihood of adverse judgments or outcomes, as well as the potential range of possible loss. The required reserves are monitored on an ongoing basis and are updated based on new developments or new information in each matter.

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Environmental Protection Agency Notice

In December 2009, the Company received formal, written requests for information from the United States Environmental Protection Agency (EPA) regarding: (i) certificates of conformity for motorcycle emissions and related designations and labels, (ii) aftermarket parts, and (iii) warranty claims on emissions related components. The Company promptly submitted written responses to the EPA’s inquiry and engaged in discussions with the EPA. It is possible that a result of the EPA’s investigation will be some form of enforcement action by the EPA that will seek a fine or other relief. However, at this time the Company does not know and cannot reasonably estimate the impact of any remedies the EPA might seek.

York Environmental Matters:

The Company is involved with government agencies and groups of potentially responsible parties in various environmental matters, including a matter involving the cleanup of soil and groundwater contamination at its York, Pennsylvania facility. The York facility was formerly used by the U.S. Navy and AMF prior to the purchase of the York facility by the Company from AMF in 1981. Although the Company is not certain as to the full extent of the environmental contamination at the York facility, it has been working with the Pennsylvania Department of Environmental Protection (PADEP) since 1986 in undertaking environmental investigation and remediation activities, including an ongoing site-wide remedial investigation/feasibility study (RI/FS). In January 1995, the Company entered into a settlement agreement (the Agreement) with the Navy. The Agreement calls for the Navy and the Company to contribute amounts into a trust equal to 53% and 47%, respectively, of future costs associated with environmental investigation and remediation activities at the York facility (Response Costs). The trust administers the payment of the Response Costs incurred at the York facility as covered by the Agreement.

In February 2002, the Company was advised by the EPA that it considers some of the Company’s remediation activities at the York facility to be subject to the EPA’s corrective action program under the Resource Conservation and Recovery Act (RCRA) and offered the Company the option of addressing corrective action under a RCRA facility lead agreement. In July 2005, the York facility was designated as the first site in Pennsylvania to be addressed under the “One Cleanup Program.” The program provides a more streamlined and efficient oversight of voluntary remediation by both PADEP and EPA and will be carried out consistent with the Agreement with the Navy. As a result, the RCRA facility lead agreement has been superseded.

The Company estimates that its share of the future Response Costs at the York facility will be approximately $3.3 million and has established a reserve for this amount which is included in accrued liabilities in the Condensed Consolidated Balance Sheets⁽¹⁾. As noted above, the RI/FS is still underway and given the uncertainty that exists concerning the nature and scope of additional environmental investigation and remediation that may ultimately be required under the RI/FS or otherwise at the York facility, we are unable to make a reasonable estimate of those additional costs, if any, that may result.

The estimate of the Company’s future Response Costs that will be incurred at the York facility is based on reports of independent environmental consultants retained by the Company, the actual costs incurred to date and the estimated costs to complete the necessary investigation and remediation activities. Response Costs related to the remediation of soil are expected to be incurred primarily over a period of several years ending in 2015. Response Costs related to ground water remediation may continue for some time beyond 2015.

Product Liability Matters:

Additionally, the Company is involved in product liability suits related to the operation of its business. The Company accrues for claim exposures that are probable of occurrence and can be reasonably estimated. The Company also maintains insurance coverage for product liability exposures. The Company believes that its accruals and insurance coverage are adequate and that product liability will not have a material adverse effect on the Company’s consolidated financial statements.

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Liquidity and Capital Resources as of April 1, 2012⁽¹⁾

Over the long-term, the Company expects that its business model will continue to generate cash that will allow it to invest in the business, fund future growth opportunities and return value to shareholders. The Company believes the Motorcycles operations will continue to be primarily funded through cash flows generated by operations. The Company’s Financial Services operations have been funded with unsecured debt, unsecured commercial paper, an asset-backed commercial paper conduit facility and committed unsecured bank facilities and through the term asset-backed securitization market.

The Company’s strategy is to maintain a minimum of twelve months of its projected liquidity needs through a combination of cash and marketable securities and availability under credit facilities. The following table summarizes the Company’s cash and marketable securities and availability under credit facilities (in thousands):

	April 1, 2012
Cash and cash equivalents	$	1,276,337
Marketable securities		134,946
Total cash and cash equivalents and marketable securities		1,411,283
Global credit facilities		537,462
Asset-backed conduit facility(a)		600,000
Total availability under credit facilities		1,137,462
Total	$	2,548,745

(a) The conduit facility is set to expire in September 2012.

The Company recognizes that it must continue to monitor and adjust to changes in the lending environment for its Financial Services operations. The Company intends to continue with a diversified funding profile through a combination of short-term and long-term funding vehicles and to pursue a variety of sources to obtain cost-effective funding. The Financial Services operations could be negatively affected by higher costs of funding and increased difficulty of raising, or potential unsuccessful efforts to raise, funding in the short-term and long-term capital markets. These negative consequences could in turn adversely affect the Company’s business and results of operations in various ways, including through higher costs of capital, reduced funds available through its Financial Services operations to provide loans to independent dealers and their retail customers, and dilution to existing shareholders through the use of alternative sources of capital.

Cash Flow Activity

The following table summarizes the cash flow activity of continuing operations for the periods indicated (in thousands):

	Three months ended
	April 1, 2012			March 27, 2011
Net cash used by operating activities	$	(73,616	)	$	(104,918	)
Net cash provided by investing activities		32,019			125,022
Net cash used by financing activities		(209,942	)		(106,804	)
Effect of exchange rate changes on cash and cash equivalents		926			(2,693	)
Net decrease in cash and cash equivalents of continuing operations	$	(250,613	)	$	(89,393	)

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Operating Activities of Continuing Operations

The decrease in cash used by operating activities for the first three months of 2012 compared to the first three months of 2011 was due primarily to increased Motorcycles Segment earnings partially offset by changes in working capital. The Company made a voluntary $200.0 million contribution to the Company’s pension plans in the first quarter of 2012 and in the first quarter of 2011. No additional pension contributions are required in 2012. The Company expects it will continue to make on-going contributions related to current benefit payments for SERPA and postretirement healthcare plans.

Investing Activities of Continuing Operations

The Company’s investing activities consist primarily of capital expenditures, net changes in finance receivables and short-term investment activity. Capital expenditures were $24.7 million in the first quarter of 2012 compared to $27.7 million in the same period last year. Net cash inflows from finance receivables, net for the first three months of 2012 were $91.1 million lower than in the same period last year as a result of an increase in retail motorcycle loan originations during 2012. A net increase in marketable securities during the first quarter of 2012 resulted in lower investing cash flows of approximately $5 million compared to the same period last year.

Financing Activities of Continuing Operations

The Company’s financing activities consist primarily of share repurchases, dividend payments and debt activity. Cash outflows from share repurchases were $20.7 million in the first quarter of 2012 compared to $4.7 million for the same period last year. Share repurchases during the first quarter of 2012 included 0.5 million shares of common stock related to discretionary share repurchases as well as shares of common stock that employees surrendered to satisfy withholding taxes in connection with the vesting of restricted stock awards. Share repurchases during the first quarter of 2011 were limited to shares of common stock that employees surrendered to satisfy withholding taxes in connection with the vesting of restricted stock awards. As of April 1, 2012, there were 16.7 million shares remaining on a board-approved share repurchase authorization. In addition, as of April 1, 2012, 2.9 million shares remained on a separate board-approved share repurchase authorization that is in place to offset option exercises. In total at April 1, 2012, the Company had authorization to repurchase 19.6 million shares of its common stock.

The Company paid dividends of $0.155 per share totaling $35.9 million during the first three months of 2012 and $0.10 per share totaling $23.5 million during the first three months of 2011.

Financing cash flows related to debt activity resulted in net cash outflows of $160.2 million in the first quarter of 2012 compared to $79.6 million in the first quarter of 2011. The Company’s total outstanding debt consisted of the following (in thousands):

	April 1, 2012		March 27, 2011
Global credit facilities	$	150,195	$	217,651
Unsecured commercial paper		662,343		488,493
Medium-term notes		2,698,232		2,347,624
Senior unsecured notes		303,000		303,000
		3,813,770		3,356,768
Term asset-backed securitization debt held by VIEs		1,754,320		2,324,763
Total debt	$	5,568,090	$	5,681,531

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To access the debt capital markets, the Company relies on credit rating agencies to assign short-term and long-term credit ratings. Generally, lower credit ratings result in higher borrowing costs and reduced access to debt capital markets. A credit rating agency may change or withdraw the Company’s ratings based on its assessment of the Company’s current and future ability to meet interest and principal repayment obligations. The Company’s short-term debt ratings affect its ability to issue unsecured commercial paper. The Company’s short- and long-term debt ratings as of April 1, 2012 were as follows:

	Short-Term	Long-Term	Outlook
Moody’s	P2	Baa1	Stable
Standard & Poor’s	A2	BBB+	Stable
Fitch	F2	BBB+	Positive

Global Credit Facilities – On April 13, 2012, the Company and HDFS entered into a new $675.0 million five-year credit facility to refinance and replace a $675.0 million three-year credit facility that was due to mature in April 2013. The new five-year credit facility matures in April 2017. The Company and HDFS also have a $675.0 million four-year credit facility which matures in April 2015. The new five-year credit facility and the four-year credit facility (together, the Global Credit Facilities) bear interest at various variable interest rates, which may be adjusted upward or downward depending on certain criteria, such as credit ratings. The Global Credit Facilities also require the Company to pay a fee based upon the average daily unused portion of the aggregate commitments under the Global Credit Facilities. The Global Credit Facilities are committed facilities and primarily used to support HDFS’ unsecured commercial paper program.

Unsecured Commercial Paper – Subject to limitations, HDFS could issue unsecured commercial paper of up to $1.35 billion as of April 1, 2012 supported by the $675.0 million three-year credit facility that was replaced in April 2012 and the $675.0 million four-year credit facility discussed above. Outstanding unsecured commercial paper may not exceed the unused portion of the Global Credit Facilities. Maturities may range up to 365 days from the issuance date. HDFS intends to repay unsecured commercial paper as it matures with additional unsecured commercial paper or through other means, such as borrowing under the Global Credit Facilities, borrowing under its asset-backed commercial paper conduit facility or through the use of operating cash flow.⁽¹⁾

Medium-Term Notes – The Company had the following medium-term notes (collectively, the Notes) issued and outstanding at April 1, 2012 (in thousands):

Principal Amount	Rate	Issue Date	Maturity Date
$400,000	5.25%	December 2007	December 2012
$500,000	5.75%	November 2009	December 2014
$450,000	3.875%	March 2011	March 2016
$400,000	2.70%	January 2012	March 2017
$950,131	6.80%	May 2008	June 2018

The Notes provide for semi-annual interest payments and principal due at maturity. Unamortized discounts on the Notes reduced the balance by $1.9 million and $2.4 million at April 1, 2012 and March 27, 2011, respectively.

In January 2012, HDFS issued $400.0 million of medium-term notes, which mature in March 2017 and have an annual interest rate of 2.7%.

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Senior Unsecured Notes – In February 2009, the Company issued $600.0 million of senior unsecured notes in an underwritten offering. The senior unsecured notes provide for semi-annual interest payments and principal due at maturity. The senior unsecured notes mature in February 2014 and have an annual interest rate of 15%. During the fourth quarter of 2010, the Company repurchased $297.0 million of the $600.0 million senior unsecured notes at a price of $380.8 million.

Asset-Backed Commercial Paper Conduit Facility – On September 9, 2011, HDFS amended and restated its revolving asset-backed conduit facility which provides for a total aggregate commitment of $600.0 million. The agreement has similar terms as the prior agreement and is for the same amount. At April 1, 2012, HDFS had no outstanding borrowings under the conduit facility.

This debt provides for interest on outstanding principal based on prevailing commercial paper rates, or LIBOR plus a specified margin to the extent the advance is not funded by a conduit lender through the issuance of commercial paper. The conduit facility also provides for an unused commitment fee based on the unused portion of the total aggregate commitment of $600.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivable collateral are applied to outstanding principal. Upon expiration of the conduit facility, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of HDFS and the lenders, as of April 1, 2012, the conduit facility expires on September 7, 2012.

Term Asset-Backed Securitization Debt Held by VIEs – There were no term asset-backed securitization transactions during the three months ended April 1, 2012 or March 27, 2011.

For all of the term asset-backed securitization transactions, HDFS transferred U.S. retail motorcycle finance receivables to separate VIEs, which in turn issued secured notes, with various maturities and interest rates to investors. All of the notes held by the VIEs are secured by future collections of the purchased U.S. retail motorcycle finance receivables. The U.S. retail motorcycle finance receivables included in the term asset-backed securitization transactions are not available to pay other obligations or claims of HDFS’ creditors until the associated debt and other obligations are satisfied. Cash and cash equivalent balances held by the VIEs are used only to support the securitizations. There is no amortization schedule for the secured notes; however, the debt is reduced monthly as available collections on the related retail motorcycle finance receivables are applied to outstanding principal. The secured notes’ contractual lives have various maturities ranging from 2012 to 2018.

As of April 1, 2012, the assets of the VIEs totaled $2.76 billion, of which $2.51 billion of finance receivables and $245.9 million of cash were restricted as collateral for the payment of $1.75 billion of obligations under the secured notes. Approximately $620.6 million of the obligations under the secured notes were classified as current at April 1, 2012, based on the contractual maturities of the restricted finance receivables.

Intercompany Borrowing – HDFS has a revolving credit line with the Company whereby HDFS may borrow up to $210.0 million from the Company at a market interest rate. As of April 1, 2012 and March 27, 2011, HDFS had no outstanding borrowings owed to the Company under this agreement.

The Company has a support agreement with HDFS whereby, if required, the Company agrees to provide HDFS with financial support to maintain HDFS’ fixed-charge coverage at 1.25 and minimum net worth of $40.0 million. Support may be provided at the Company’s option as capital contributions or loans. Accordingly, certain debt covenants may restrict the Company’s ability to withdraw funds from HDFS outside the normal course of business. No amount has ever been provided to HDFS under the support agreement.

Operating and Financial Covenants – HDFS and the Company are subject to various operating and financial covenants related to the Global Credit Facilities and various operating covenants under the Notes and the asset-backed commercial paper conduit facility. The more significant covenants are described below.

The covenants limit the Company’s and HDFS’ ability to:

• incur certain additional indebtedness;

• assume or incur certain liens;

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• participate in a merger, consolidation, liquidation or dissolution; and

• purchase or hold margin stock.

Under the financial covenants of the Global Credit Facilities, the consolidated debt to equity ratio of HDFS cannot exceed 10.0 to 1.0. In addition, the Company must maintain a minimum interest coverage ratio of at least 2.25 to 1.0 for each fiscal quarter through June 2013 and 2.5 to 1.0 for each fiscal quarter thereafter. No financial covenants are required under the Notes or the asset-backed commercial paper conduit facility.

At April 1, 2012, HDFS and the Company remained in compliance with all of the then existing covenants.

Cash Flows from Discontinued Operations

There were no cash flows from discontinued operations during the three months ended April 1, 2012 and March 27, 2011, respectively.

Cautionary Statements

The Company’s ability to meet the targets and expectations noted depends upon, among other factors, the Company’s ability to:

(i) execute its business strategy,

(ii) effectively execute the Company’s restructuring plans within expected costs and timing,

(iii) implement and manage enterprise-wide information technology solutions, including solutions at its manufacturing facilities, and secure data contained in those systems,

(iv) adjust to fluctuations in foreign currency exchange rates, interest rates and commodity prices,

(v) anticipate the level of consumer confidence in the economy,

(vi) manage through inconsistent economic conditions, including changing capital, credit and retail markets,

(vii) continue to realize production efficiencies at its production facilities and manage operating costs including materials, labor and overhead,

(viii) successfully implement with our labor unions the agreements that we have executed with them that we believe will provide flexibility and cost-effectiveness to accomplish restructuring goals and long-term competitiveness,

(ix) manage risks that arise through expanding international operations and sales,

(x) manage supply chain issues, including any unexpected interruptions or price increases caused by raw material shortages or natural disasters,

(xi) manage production capacity and production changes,

(xii) provide products, services and experiences that are successful in the marketplace,

(xiii) develop and implement sales and marketing plans that retain existing retail customers and attract new retail customers in an increasingly competitive marketplace,

(xiv) manage the risks that our independent dealers may have difficulty obtaining capital and managing through changing economic conditions and consumer demand,

(xv) continue to have access to reliable sources of capital funding and adjust to fluctuations in the cost of capital,

(xvi) manage the credit quality, the loan servicing and collection activities, and the recovery rates of HDFS’ loan portfolio,

(xvii) sell all of its motorcycles and related products and services to its independent dealers,

(xviii) continue to develop the capabilities of its distributor and dealer network,

(xix) manage changes and prepare for requirements in legislative and regulatory environments for its products, services and operations,

(xx) adjust to healthcare inflation and reform, pension reform and tax changes,

(xxi) retain and attract talented employees, and

(xxii) detect any issues with our motorcycles or manufacturing processes to avoid delays in new model launches, recall campaigns, increased warranty costs or litigation.

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In addition, the Company could experience delays or disruptions in its operations as a result of work stoppages, strikes, natural causes, terrorism or other factors. Other factors are described in risk factors that the Company has disclosed in documents previously filed with the Securities and Exchange Commission. Many of these risk factors are impacted by the current changing capital, credit and retail markets and the Company’s ability to manage through inconsistent economic conditions.

The Company’s ability to sell its motorcycles and related products and services and to meet its financial expectations also depends on the ability of the Company’s independent dealers to sell its motorcycles and related products and services to retail customers. The Company depends on the capability and financial capacity of its independent dealers and distributors to develop and implement effective retail sales plans to create demand for the motorcycles and related products and services they purchase from the Company.

In addition, the Company’s independent dealers and distributors may experience difficulties in operating their businesses and selling Harley-Davidson motorcycles and related products and services as a result of weather, economic conditions or other factors.

Refer to “Risk Factors” under Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 for a discussion of additional risk factors and a more complete discussion of some of the cautionary statements noted above.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 for a complete discussion of the Company’s market risk. There have been no material changes to the market risk information included in the Company’s Annual Report on Form 10-K for the year December 31, 2011.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

In accordance with Rule 13a-15(b) of the Securities Exchange Act of 1934 (the Exchange Act), as of the end of the period covered by this Quarterly Report on Form 10-Q, the Company’s management evaluated, with the participation of the Company’s Chairman, President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer, the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based upon their evaluation of these disclosure controls and procedures, the Chairman, President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer have concluded that the disclosure controls and procedures were effective as of the end of the period covered by this Quarterly Report on Form 10-Q to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time period specified in the Securities and Exchange Commission rules and forms, and to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its Chairman, President and Chief Executive Officer and Senior Vice President and Chief Financial Officer, as appropriate, to allow timely decisions regarding disclosure.

Changes in Internal Controls

There was no change in the Company’s internal control over financial reporting during the quarter ended April 1, 2012 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II – OTHER INFORMATION

Item 1 – Legal Proceedings

The information required under this Item 1 of Part II is contained in Item 1 of Part I of the Quarterly report on From 10-Q in Note 16 of the Notes to Condensed Consolidated Financial Statements, and such information is incorporated herein by reference in this Item 1 of Part II.

Item 2 – Unregistered Sales of Equity Securities and Use of Proceeds

The following table contains detail related to the repurchase of common stock based on the date of trade during the quarter ended April 1, 2012:

2012 Fiscal Month	Total Number of Shares Purchased (a)		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Yet Be Purchased Under  the Plans or Programs
January 1 to February 5		208,515	$	44		208,515		18,711,359
February 6 to March 4		249,963	$	46		249,963		19,487,478
March 5 to April 1		755	$	46		755		19,645,243
Total		459,233	$	45		459,233

(a) Includes discretionary share repurchases and shares of common stock that employees surrenderd to satisfy withholding taxes in connection with the vesting of restricted stock awards

The Company has an authorization (originally adopted in December 1997) by its Board of Directors to repurchase shares of its outstanding common stock under which the cumulative number of shares repurchased, at the time of any repurchase, shall not exceed the sum of (1) the number of shares issued in connection with the exercise of stock options occurring on or after January 1, 2004 plus (2) one percent of the issued and outstanding common stock of the Company on January 1 of the current year, adjusted for any stock split. The Company made discretionary share repurchases of 254,410 shares during the quarter ended April 1, 2012 under this authorization. As of April 1, 2012, 2.9 million shares remained under this authorization.

In December 2007, the Company’s Board of Directors separately authorized the Company to buy back up to 20.0 million shares of its common stock with no dollar limit or expiration date. As of April 1, 2012, 16.7 million shares remained under this authorization.

From time to time, the Company may enter into a Rule 10b5-1 trading plan for the purpose of repurchasing shares under either the 1997 authorization or 2007 authorization.

The Harley-Davidson, Inc. 2009 Incentive Stock Plan and predecessor stock plans permit participants to satisfy all or a portion of the statutory federal, state and local withholding tax obligations arising in connection with plan awards by electing to (a) have the Company withhold shares otherwise issuable under the award, (b) tender back shares received in connection with such award or (c) deliver other previously owned shares, in each case having a value equal to the amount to be withheld. During the first quarter of 2012, the Company acquired 204,823 shares of common stock that employees presented to the Company to satisfy withholding taxes in connection with the vesting of restricted stock awards.

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Item 6 – Exhibits

Refer to the Exhibit Index on page 57 of this report.

55

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	HARLEY-DAVIDSON, INC.
Date: May 10, 2012	/s/ John A. Olin
	John A. Olin
	Senior Vice President and
	Chief Financial Officer
	(Principal financial officer)
Date: May 10, 2012	/s/ Mark R. Kornetzke
	Mark R. Kornetzke
	Chief Accounting Officer
	(Principal accounting officer)

56

Harley-Davidson, Inc.

Exhibit Index to Form 10-Q

Exhibit No.	Description
4.1	Amendment No. 1, dated as of April 13, 2012, among the Company, certain subsidiaries of the Company, the financial institutions parties thereto and JPMorgan Chase Bank, N.A., as global administrative agent, to 4-year Credit Agreement dated as of April 28, 2011 among the Company, certain subsidiaries of the Company, the financial institutions parties thereto and JPMorgan Chase Bank, N.A., as global administrative agent
4.2	5-Year Credit Agreement, dated as of April 13, 2012 among the Company, certain subsidiaries of the Company, the financial institutions parties thereto and JPMorgan Chase Bank, N.A., as among other things, global administrative agent
10.1*	Director Compensation Policy effective April 28, 2012
31.1	Chief Executive Officer Certification pursuant to Rule 13a-14(a)
31.2	Chief Financial Officer Certification pursuant to Rule 13a-14(a)
32.1	Written Statement of the Chief Executive Officer and the Chief Financial Officer pursuant to 18 U.S.C. §1350
101	Financial statements from the quarterly report on Form 10-Q of Harley-Davidson, Inc. for the quarter ended April 1, 2012, filed on May 10, 2012, formatted in XBRL: (i) the Condensed Consolidated Statements of Income; (ii) the Condensed Consolidated Balance Sheets; (iii) the Condensed Consolidated Statements of Cash Flows; and (iv) the Notes to Condensed Consolidated Financial Statements furnished herewith.

* Represents a management contract or compensatory plan, contract or arrangement in which a director or named executive officer of the Company participated.

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EX-4.1

Exhibit 4.1

EXECUTION COPY

AMENDMENT NO. 1 TO 4-YEAR CREDIT AGREEMENT

Dated as of April 13, 2012

to

CREDIT AGREEMENT

Dated as of April 28, 2011

THIS AMENDMENT NO. 1 TO 4-YEAR CREDIT AGREEMENT (“Amendment”) is made as of April 13, 2012 (the “Effective Date”) by and among Harley-Davidson, Inc., a Wisconsin corporation and Harley-Davidson Funding Corp., a Nevada corporation (collectively, the “Borrowers”), the financial institutions listed on the signature pages hereof and JPMorgan Chase Bank, N.A., as Global Administrative Agent (the “Administrative Agent”), under that certain 4-Year Credit Agreement dated as of April 28, 2011 by and among the Borrowers, Harley-Davidson Financial Services, Inc., a Delaware corporation, Harley-Davidson Credit Corp., a Nevada corporation and certain other Subsidiaries of Harley from time to time party thereto, as Guarantors, the Lenders and the Administrative Agent (as amended prior to the date hereof, the “Credit Agreement”). Capitalized terms used herein and not otherwise defined herein shall have the respective meanings given to them in the Credit Agreement.

WHEREAS, the Borrowers have requested that certain modifications be made to the Credit Agreement;

WHEREAS, the Borrowers, the Lenders party hereto and the Administrative Agent have agreed to amend the Credit Agreement on the terms and conditions set forth herein;

NOW, THEREFORE, in consideration of the premises set forth above, the terms and conditions contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Borrowers, the Lenders party hereto and the Administrative Agent hereby agree to the following amendment to the Credit Agreement.

1. Amendments to Credit Agreement. Effective as of the Effective Date but subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Credit Agreement is hereby amended as follows:

(a) The preliminary statement of the Credit Agreement is amended to delete the phrase “certain other Subsidiaries of Harley from time to time party hereto as Opco Guarantors,” appearing therein.

(b) Section 1.1 of the Credit Agreement is amended to add the following new definitions therein in the appropriate alphabetical order:

“Amendment No. 1 Effective Date” means April 13, 2012.

“Consolidated Total Assets” means, as of the date of any determination thereof, the Consolidated total assets of Harley and its Subsidiaries as of such date, as shall be determined in accordance with Agreement Accounting Principles.

“Participant Register” is defined in Section 13.2(A) hereof.

(c) Section 1.1 of the Credit Agreement is amended to delete the definitions of “Guaranty Ratings Threshold Date”, “Material Domestic Opco Subsidiary”, “Non-Loan Party”, “Opco Guarantor” and “Risk-Based Capital Guidelines” appearing therein.

(d) The definition of “Affiliate” appearing in Section 1.1 of the Credit Agreement is amended to delete the phrase “is the ‘beneficial owner’ (as defined in Rule 13d-3 under the Securities Exchange Act of 1934) of greater than five percent (5%) or more of any class of voting securities (or other voting interests) of the controlled Person or” appearing immediately after the phrase “A Person shall be deemed to control another Person if the controlling Person” therein.

(e) The definition of “Agreement Accounting Principles” appearing in Section 1.1 of the Credit Agreement is amended to change the date “December 31, 2010” appearing therein to the date “December 31, 2011”.

(f) The definition of “Change of Control” appearing in Section 1.1 of the Credit Agreement is amended to add the phrase “in each case other than as a result of a transaction permitted under Section 6.2.3.,” immediately after the reference to “(b)” appearing therein.

(g) The definition of “Company” appearing in Section 1.1 of the Credit Agreement is amended to delete the phrase “; provided that no Opco Guarantor (other than any Opco Guarantor executing this Agreement on the Closing Date in such capacity) shall be considered a “Company” hereunder unless and until all of the requirements of Section 6.1.11(a) have been satisfied with respect to such entity and each Opco Guarantor shall cease to be considered a “Company” hereunder upon its release from the Guarantee as contemplated by Section 6.1.11(b) (until such time, if any, that it is subsequently required to satisfy the requirements of Section 6.1.11(a))” appearing at the end thereof.

(h) The definition of “Defaulting Lender” appearing in Section 1.1 of the Credit Agreement is amended to (i) delete the phrase “(a) failed to (i) fund its Pro Rata Share of any Advance or Loan” appearing therein, (ii) delete the words “by it hereunder” appearing after the word “funded” and replace such word with the phrase “or paid (a) failed to (i) fund its Pro Rata Share of any Advance or Loan” and (iii) add the word “reasonably” immediately before the word “satisfactory” appearing in clause (c) thereof.

(i) The definition of “FATCA” appearing in Section 1.1 of the Credit Agreement is amended to (i) delete the phrase “date of this Agreement,” and replace such phrase with the phrase “Amendment No. 1 Effective Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with)” and (ii) delete the phrase “; provided, however, that “FATCA” shall also include any amendments to Sections 1471 through 1474 of the Code that are substantively comparable, but only if the requirements in such amended version for avoiding the withholding are not materially more onerous than the requirements in the current version” appearing at the end thereof.

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(j) The definition of “Guarantor” appearing in Section 1.1 of the Credit Agreement is amended and restated in its entirety as follows:

“Guarantor” means each of HDFC and each of the Finco Guarantors and in each such case their respective successors and permitted assigns.

(k) The definition of “Indebtedness” appearing in Section 1.1 of the Credit Agreement is amended to (i) delete the word “and” appearing immediately before clause (iv) thereof and to replace such word with a comma and (ii) add the phrase “and (v) any Indebtedness that has been defeased, provided that funds in an amount equal to all such Indebtedness (including interest and any other amounts required to be paid to the holders thereof in order to give effect to such defeasance) have been irrevocably deposited with a trustee for the benefit of the relevant holders of such Indebtedness” immediately after the word “Earnouts” appearing in clause (iv) thereof.

(l) The definition of “Indemnified Taxes” appearing in Section 1.1 of the Credit Agreement is amended to delete the reference to “the Company” appearing therein and replace such reference with a reference to “any Company”.

(m) The definition of “Net Worth” appearing in Section 1.1 of the Credit Agreement is amended to delete the word “shareholder’s” appearing therein and replace such word with the word “shareholders’”.

(n) The definition of “Support Agreement” appearing in Section 1.1 of the Credit Agreement is amended to add the phrase “and the letter agreement dated as of April 13, 2012, in each case” immediately after the phrase “the letter agreement dated as of April 28, 2011” appearing therein.

(o) The definition of “Applicable Commitment Fee Rate” appearing in Section 2.6(b)(i) of the Credit Agreement is amended to add the phrase “Harley’s Status as established by reference to” immediately after the phrase “and determined by reference to” appearing therein.

(p) Clause (b)(ii) of Section 2.6 of the Credit Agreement is amended and restated in its entirety to read as follows:

(ii) Determination of Applicable Percentage, Applicable Floor and Applicable Commitment Fee Rate. The Applicable Percentage and the Applicable Floor in respect of any Loan and the Applicable Commitment Fee Rate payable under Section 2.14(C) shall be determined by reference to the table set forth in clause (i) above on the basis of the Status as determined from Harley’s then-current Moody’s Rating, S&P Rating and Fitch Rating. The Applicable Margin in respect of any Loan shall be determined by reference to the table set forth in clause (i) above on the basis of the Status as determined from Harley’s or the Applicable Finco’s, as applicable, then-current Moody’s Rating, S&P Rating and Fitch Rating. The rating in effect on any date for the purposes of this Section is that in effect at the close of business on such date (it being understood and agreed that any change in such rating shall be effective as of the date on which such change is first announced publicly by the rating agency making such change). Except under the circumstances described in clause (iii) below, if at any time Harley has no Moody’s Rating, no S&P Rating and no Fitch Rating, Level V Status shall exist with respect to Loans to Harley and with respect to the Applicable Commitment Fee Rate.

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Except under the circumstances described in clause (iii) below, if at any time each Finco has no Moody’s Rating, no S&P Rating and no Fitch Rating, Level V Status shall exist with respect to Loans to any Borrower other than Harley. If any rating agency shall change the basis on which ratings are established, each reference to Moody’s Rating, S&P Rating or Fitch Rating shall refer to the then equivalent rating by the applicable rating agency. Notwithstanding the foregoing, (a) if Harley or the Applicable Finco, as applicable, is split-rated by all three rating agencies (i.e., the ratings issued by the rating agencies are at three different levels), then the intermediate level will apply, and (b) in the event that Harley or the Applicable Finco, as applicable, shall maintain ratings from only two rating agencies and they are split-rated and (x) the ratings differential is one level, then the higher level will apply and (y) the ratings differential is two levels or more, then the level next below that of the higher of the levels will apply.

(q) Clause (b)(iii) of Section 2.6 of the Credit Agreement is amended to delete the phrase “and the “Guaranty Ratings Threshold Date” appearing in the parenthetical therein.

(r) The last paragraph of Section 3.1 of the Credit Agreement is amended to (i) delete the first reference to “such Person” appearing therein and replace such reference with a reference to “that Person” and (ii) add the phrase “Commitment or” immediately before the word “Loans” appearing therein.

(s) Section 3.2 of the Credit Agreement is amended to (i) add the phrase “or liquidity” (x) immediately after the phrase “the amount of capital” appearing in clause (i) thereof, (y) immediately after the phrases “such increase in capital” and “such increased capital” appearing in clause (ii) thereof and (z) immediately after the phrase “which affects the amount of capital” appearing in the definition of “Change” therein, (ii) add the phrase “and liquidity” immediately after the phrase “(after taking into account such Lender’s policies as to capital adequacy” appearing in clause (ii) thereof, (iii) delete the phrase “(i) any change after the date of this Agreement in the “Risk-Based Capital Guidelines” (as defined below) excluding, for the avoidance of doubt, the effect of any phasing in of such Risk-Based Capital Guidelines or any other capital requirements, in each case passed prior to the date hereof, or (ii)” appearing in the definition of “Change” therein and (iv) delete the definition of “Risk-Based Capital Guidelines” appearing at the end thereof.

(t) Clause (vii) of Section 3.5 of the Credit Agreement is hereby amended to (i) delete the phrase “any Taxes (but, in the case of any Indemnified Taxes and Other Taxes, only to the extent that the Companies have not already indemnified the Global Administrative Agent for such Indemnified Taxes and Other Taxes without limiting the obligation of the Companies to do so in accordance with the Loan Documents) attributable to such Lenders” appearing therein and replace such phrase with the phrase “(i) any Indemnified Taxes or Other Taxes attributable to such Lender (but only to the extent that the Companies have not already indemnified the Global Administrative Agent for such Indemnified Taxes or Other Taxes and without limiting the obligation of Companies to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 13.2 relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case” and (ii) add the phrase “Each Lender hereby authorizes the Global Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Global Administrative Agent to the Lender from any other source against any amount due to the Global Administrative Agent under this Section 3.5(vii)” at the end thereof.

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(u) Section 5.1.5 of the Credit Agreement is amended to change the date “December 31, 2010” appearing therein to the date “December 31, 2011”.

(v) Section 5.1.6 of the Credit Agreement is amended to change the date “December 31, 2010” appearing therein to the date “December 31, 2011”.

(w) Section 6.1.2 of the Credit Agreement is amended to (i) delete the reference to “(i)” appearing therein, (ii) delete the phrase “and (ii) all lawful claims that, if unpaid, would by law become a Lien upon its Property (other than Liens of the type described in clause (b) of the definition of “Permitted Liens”)” appearing therein, (iii) delete the comma appearing immediately after the word “assessment” appearing in the proviso thereof and replace such comma with the word “or” and (iv) delete the phrase “or claim” appearing immediately after the word “charge” in the proviso thereof.

(x) Section 6.1.10 of the Credit Agreement is amended to delete the phrase “(including, without limitation, maturing commercial paper of a U.S. Borrower)” appearing at the end thereof.

(y) Section 6.1.11 of the Credit Agreement is deleted in its entirety.

(z) Clause (s) of Section 6.2.1 of the Credit Agreement is amended to delete the phrase “unsecured Indebtedness of H-D Varese Holding Co. S.r.l. and its Subsidiaries (including successors and assigns) in an aggregate principal amount not exceeding €200,000,000 at any time outstanding” appearing therein and replace such phrase with the phrase “[Intentionally Omitted]”.

(aa) Clause (v) of Section 6.2.1 of the Credit Agreement is amended to (i) delete the amount “$150,000,000” appearing therein and (ii) add the phrase “the greater of (i) $150,000,000 and (ii) an amount equal to 1.5% of the Consolidated Total Assets (determined by reference to the most recent financial statements of Harley delivered pursuant to Section 6.1.9(a) or 6.1.9(b) or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 6.1.9(a) or 6.1.9(b), the most recent financial statements referred to in Section 5.1.5) as determined at the time of, and immediately after giving effect to, the incurrence of such Indebtedness” at the end thereof.

(bb) Clause (e) of Section 6.2.2 of the Credit Agreement is amended to (i) delete the amount “$150,000,000” appearing therein and (ii) add the phrase “the greater of (i) $150,000,000 and (ii) an amount equal to 1.5% of the Consolidated Total Assets (determined by reference to the most recent financial statements of Harley delivered pursuant to Section 6.1.9(a) or 6.1.9(b) or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 6.1.9(a) or 6.1.9(b), the most recent financial statements referred to in Section 5.1.5) as determined at the time of, and immediately after giving effect to, the incurrence of such Lien or the making of such assignment” at the end thereof.

(cc) The definition of “Consolidated Tangible Net Worth” appearing in clause (A) of Section 6.3 of the Credit Agreement is amended to delete the word “shareholder’s” appearing therein and replace such word with the word “shareholders’”.

(dd) Clause (c) of Section 7.1 of the Credit Agreement is amended to delete the reference to “6.1.11,” appearing therein.

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(ee) Section 9.8 of the Credit Agreement is amended to delete the phrase “date of this Agreement” appearing at the end thereof and replace such phrase with the phrase “Amendment No. 1 Effective Date”.

(ff) Section 9.11 of the Credit Agreement is amended to add the word “COURT” immediately after the phrase “IN SUCH NEW YORK STATE” appearing therein.

(gg) The final paragraph of Article XII is amended and restated in its entirety to read as follows:

Notwithstanding anything contained in this Article XII to the contrary, the obligations of the Finco Guarantors under this Article XII shall be solely in respect of the Loans made to, and any other Obligations of, HDFC.

(hh) Section 13.1 of the Credit Agreement is amended to add the phrase “or other central banking authority with authority over such Lender” immediately after the reference to “Federal Reserve Bank” appearing in the second sentence thereof.

(ii) Clause A of Section 13.2 of the Credit Agreement is amended to add the sentence “For the avoidance of doubt, the Global Administrative Agent (in its capacity as Global Administrative Agent) shall have no responsibility for maintaining a Participant Register.” at the end thereof.

(jj) Section 13.3 of the Credit Agreement is amended to add the following as a new clause (D) thereof:

(D) Assignments to Borrowers. Notwithstanding anything in this Agreement to the contrary, no Lender may assign, or sell a participation in, any interest in any Loan held by it hereunder to any Borrower or any of such Borrower’s respective Affiliates or Subsidiaries without the prior consent of each Lender.

(kk) Clause (i) of Section 13.4 is amended to (i) delete the “or” appearing immediately prior to the number “(8)” therein and replace it with a comma and (ii) add the following phrase at the end of the first sentence thereof:

, (9) to any rating agency when required by it, provided that, prior to any disclosure, such rating agency shall undertake in writing to preserve the confidentiality of any such information relating to the Companies received by it from the Global Administrative Agent or any Lender or (10) on a confidential basis to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the Loans

(ll) Section 13.6(i) of the Credit Agreement is restated in its entirety as follows:

(i) HDFS, Harley and their affiliates have the right pursuant to licenses or otherwise to use certain trademark(s), logo(s), etc. relating to Harley-Davidson Motorcycles, HDFS and their affiliates (the “Licensed Marks”). Except as permitted by the following sentences, none of the Global Administrative Agent, the Lenders or their Affiliates are authorized to use such Licensed Marks or Harley’s or HDFS’s (i) text name and logo(s) (together) and/or (ii) logo(s) on forms, in legal documents, in advertising,

6

marketing materials, in press releases or any other document or material. In the event the Global Administrative Agent, any Lender or any of their Affiliates wish to use said Licensed Marks, such Person must obtain HDFS’s and Harley’s prior written approval, which said approval is at HDFS’s and Harley’s sole and absolute discretion and subject to subsequent periodic review of such use and to such reasonable specifications of HDFS and Harley to the extent such specifications are directly related to the legal maintenance, whether such is before or after lapse or termination of this Agreement. The Harley-Davidson and/or HDFS (i) text name, logo(s) and registered trademark(s) (together) and/or (ii) logo(s) and/or (iii) registered trademark(s) are not to be used by the Global Administrative Agent, any Lender or any of their Affiliates in any way before, during or after the term of this Agreement, unless prior written consent is obtained from HDFS and Harley. This section shall survive the termination of this Agreement.

(mm) Schedule 6.2.1(b) to the Credit Agreement is changed and restated as new Schedule 6.2.1(b) thereto as set forth and attached as Annex I hereto.

(nn) Schedule 6.2.2(c) to the Credit Agreement is changed and restated as new Schedule 6.2.2(c) thereto as set forth and attached as Annex II hereto.

(oo) Exhibit F to the Credit Agreement is deleted in its entirety.

(pp) The Credit Agreement is amended to replace each reference to “Closing Date” with a reference to “Amendment No. 1 Effective Date” in each place where “Closing Date” appears in the definitions of “Material Adverse Change” and “Material Adverse Effect” in Section 1.1 of the Credit Agreement, in Sections 6.2.1(b), 6.2.2(c) and 6.2.3 of the Credit Agreement and in the ninth paragraph of Article XII of the Credit Agreement.

2. Conditions of Effectiveness. The effectiveness of this Amendment is subject to the conditions precedent that the Administrative Agent shall have received (i) counterparts of this Amendment duly executed by each Borrower, the Required Lenders and the Administrative Agent and counterparts of the Consent and Reaffirmation attached hereto duly executed by the Guarantors, (ii) such other instruments, documents and legal opinions as are reasonably requested by the Administrative Agent and (iii) payment and/or reimbursement of the reasonable fees and expenses of the Administrative Agent and its affiliates (including, to the extent invoiced, fees and expenses of counsel for the Administrative Agent) in connection with this Amendment and the Loan Documents.

3. Representations and Warranties of each Borrower. Each Borrower hereby represents and warrants as follows:

(a) This Amendment and the Credit Agreement as amended hereby constitute the legal, valid and binding obligations of such Borrower enforceable against such Borrower in accordance with their terms, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and general principles of equity, regardless of whether the application of such principles is considered in a proceeding in equity or at law.

7

(b) As of the date hereof and giving effect to the terms of this Amendment, (i) no Default or Unmatured Default shall have occurred and be continuing and (ii) the representations and warranties of such Borrower contained in Article V of the Credit Agreement, as amended hereby, are true and correct in all material respects as of the Effective Date, except for representations and warranties made with reference solely to an earlier date, which representations and warranties shall be true and correct as of such earlier date.

4. Reference to and Effect on the Credit Agreement.

(a) Upon the effectiveness hereof, each reference to the Credit Agreement in the Credit Agreement or any other Loan Document shall mean and be a reference to the Credit Agreement as amended hereby.

(b) Except as specifically amended above, the Credit Agreement and all other documents, instruments and agreements executed and/or delivered in connection therewith shall remain in full force and effect and are hereby ratified and confirmed.

(c) Except as specifically provided above, the execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders, nor constitute a waiver of any provision of the Credit Agreement or any other documents, instruments and agreements executed and/or delivered in connection therewith.

5. Governing Law. This Amendment shall be construed in accordance with and governed by the internal laws of the State of New York, but giving effect to federal laws applicable to banks.

6. Headings. Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.

7. Counterparts. This Amendment may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.

[Signature Pages Follow]

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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above written.

HARLEY-DAVIDSON, INC.,
as a Borrower
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President and Treasurer
HARLEY-DAVIDSON FUNDING CORP., as a Borrower
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President, Treasurer and Assistant Secretary

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

JPMORGAN CHASE BANK, N.A.,
individually as a Lender and as Global Administrative Agent
By:	/s/ Richard W. Duker
Name:	Richard W. Duker
Title:	Managing Director

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

CITIBANK, N.A.,
as a Lender
By:	/s/ Maureen P. Maroney
Name:	Maureen Maroney
Title:	Vice President

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

BNP PARIBAS,
as a Lender
By:	/s/ Nader Tannous
Name:	Nader Tannous
Title:	Director
By:	/s/ Andrew Strait
Name:	Andrew Strait
Title:	Managing Director

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

THE ROYAL BANK OF SCOTLAND PLC,
as a Lender
By:	/s/ James Welch
Name:	James Welch
Title:	Director

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

U.S. BANK NATIONAL ASSOCIATION,
as a Lender
By:	/s/ Jerrod Clements
Name:	Jerrod Clements
Title:	Officer

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

GOLDMAN SACHS BANK USA,
as a Lender
By:	/s/ Mark Walton
Name:	Mark Walton
Title:	Authorized Signatory

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

BMO HARRIS BANK N.A.,
as a Lender
By:	/s/ Ronald J. Carey
Name:	Ronald J. Carey
Title:	Senior Vice President
By:	/s/ Leo D. Freeman
Name:	Leo D. Freeman
Title:	Senior Vice President

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

MIZUHO CORPORATE BANK, LTD., NEW YORK BRANCH,
as a Lender
By:	/s/ Yasuo Imaizumi
Name:	Yasuo Imaizumi
Title:	Deputy General Manager

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

THE BANK OF NEW YORK MELLON,
as a Lender
By:	/s/ Jeffrey Dears
Name:	Jeffrey Dears
Title:	Vice President

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,
as a Lender
By:	/s/ Victor Pierzchalski
Name:	Victor Pierzchalski
Title:	Authorized Signatory

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

TORONTO DOMINION BANK (NEW YORK) LLC,
as a Lender
By:	/s/ Kelly Hundal
Name:	Kelly Hundal
Title:	Authorized Signatory

Address:

31 West 52^nd Street, 17^th Floor

New York, NY 10019

Attention: Betty Chang

Telephone No.: (212) 827-7772

Facsimile No.: (212) 827-7232

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

WELLS FARGO BANK, N.A.,
as a Lender
By:	/s/ John D. Brady
Name:	John D. Brady
Title:	Director

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

BANCO BILBAO VIZCAYA ARGENTARIA, S.A., NEW YORK BRANCH,
as a Lender
By:	/s/ Mathias Rosenthal
Name:	Mathais Rosenthal
Title:	Associate
By:	/s/ Michael D’Anna
Name:	Michael D’Anna
Title:	Executive Director

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

THE NORTHERN TRUST COMPANY,
as a Lender
By:	/s/ Steve Ryan
Name:	Steve Ryan
Title:	Senior Vice President

Signature Page to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

CONSENT AND REAFFIRMATION

Each of the undersigned hereby acknowledges receipt of a copy of the foregoing Amendment No. 1 to the Credit Agreement dated as of April 28, 2011 (as amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) by and among Harley-Davidson, Inc., a Wisconsin corporation and Harley-Davidson Funding Corp., a Nevada corporation (collectively, the “Borrowers”), Harley-Davidson Financial Services, Inc., a Delaware corporation, Harley-Davidson Credit Corp., a Nevada corporation and certain other Subsidiaries of Harley from time to time party thereto, as Guarantors, the Lenders and JPMorgan Chase Bank, N.A., as Global Administrative Agent (the “Administrative Agent”), which Amendment No. 1 is dated as of April 13, 2012 and is by and among the Borrowers, the financial institutions listed on the signature pages thereof and the Administrative Agent (the “Amendment”). Capitalized terms used in this Consent and Reaffirmation and not defined herein shall have the meanings given to them in the Credit Agreement. Without in any way establishing a course of dealing by the Administrative Agent or any Lender, each of the undersigned consents to the Amendment and reaffirms the terms and conditions of the Support Agreement (in the case of Harley), the Guarantee (in the case of the Guarantors) and any other Loan Document executed by it and acknowledges and agrees that each and every Loan Document executed by the undersigned in connection with the Credit Agreement remains in full force and effect and is hereby reaffirmed, ratified and confirmed. All references to the Credit Agreement contained in the above-referenced documents shall be a reference to the Credit Agreement as so modified by the Amendment and as the same may from time to time hereafter be amended, modified or restated.

Dated April 13, 2012

[Signature Page Follows]

IN WITNESS WHEREOF, this Consent and Reaffirmation has been duly executed as of the day and year above written.

HARLEY-DAVIDSON FINANCIAL SERVICES, INC.
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President and Treasurer
HARLEY-DAVIDSON CREDIT CORP.
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President, Treasurer and Assistant Secretary

Signature Page to Consent and Reaffirmation to Amendment No. 1

4-Year Credit Agreement dated as of April 28, 2011

Harley-Davidson, Inc. et al

ANNEX I

Schedule 6.2.1(b)

Indebtedness

[See Attached]

SCHEDULE 6.2.1(b)

INDEBTEDNESS

1. Indebtedness arising under that certain 5-Year Credit Agreement dated as of April 13, 2012 among Harley-Davidson, Inc. and certain of its subsidiaries, the lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as Global Administrative Agent and Global Swing Line Lender, and/or any “Loan Document” under and as defined therein, in each case as amended, restated, supplemented or otherwise modified from time to time.

2. Indebtedness arising under the following industrial revenue bonds and related agreements, instruments and documents: $2,273,000 Missouri Development Finance Board BUILD Missouri Revenue Bonds Series 2002 (Harley-Davidson Project).

3. Indebtedness arising under overdraft facilities of Harley-Davidson Japan KK in an aggregate amount of 1.9 billion Yen.

ANNEX II

Schedule 6.2.2(c)

Liens

[See Attached]

SCHEDULE 6.2.2(c)

LIENS

1. Liens from time to time securing the industrial revenue bonds described on Schedule 6.2.1(b), including extensions, renewals and replacements thereof.

EX-4.2

Exhibit 4.2

EXECUTION COPY

5-YEAR CREDIT AGREEMENT

Dated as of April 13, 2012

among

HARLEY-DAVIDSON, INC., as a U.S. Borrower,

HARLEY-DAVIDSON FUNDING CORP. and

HARLEY-DAVIDSON FINANCIAL SERVICES, INC., as U.S. Borrowers and as Guarantors

and

HARLEY-DAVIDSON FINANCIAL SERVICES CANADA, INC., as the Canadian Borrower,

HARLEY-DAVIDSON FINANCIAL SERVICES INTERNATIONAL, INC. and

HARLEY-DAVIDSON CREDIT CORP.,

as Guarantors,

THE INSTITUTIONS FROM TIME TO TIME PARTY HERETO,

as Lenders,

JPMORGAN CHASE BANK, N.A.,

as Global Administrative Agent and Global Swing Line Lender,

CITIBANK, N.A.,

as Syndication Agent and

U.S. BANK NATIONAL ASSOCIATION and THE ROYAL BANK OF SCOTLAND plc,

as Documentation Agents

J.P. MORGAN SECURITIES LLC, CITIGROUP GLOBAL MARKETS, INC.,

U.S. BANK NATIONAL ASSOCIATION and RBS SECURITIES INC.,

as Co-Lead Arrangers

and

J.P. MORGAN SECURITIES LLC, CITIGROUP GLOBAL MARKETS, INC.,

U.S. BANK NATIONAL ASSOCIATION and RBS SECURITIES INC.,

as Joint Bookrunners

TABLE OF CONTENTS

			Page
ARTICLE I		DEFINITIONS		1
	1.1	Certain Defined Terms		1
	1.2	Currency Equivalents		24
ARTICLE II		THE CREDITS		25
	2.1	Syndicated Global Loans		25
	2.2	Syndicated Canadian Advances		26
	2.3	Payments of Loans		27
	2.4	Reduction/Increase of Commitments		29
	2.5	Method of Borrowing Advances		31
	2.6	Method of Selecting Types and Interest Periods; Determination of Applicable Margins		32
	2.7	Minimum Amount of Each Syndicated Global Advance and Syndicated Canadian Advance		35
	2.8	Method of Selecting Types and Interest Periods for Conversion and Continuation of Syndicated Global Advances, Syndicated Canadian Advances and Swing Line Loans		35
	2.9	Swing Line Loans		36
	2.10	The Bid Rate Advances		42
	2.11	Default Rate		45
	2.12	Method of Payment		45
	2.13	Notes, Telephonic Notices		46
	2.14	Promise to Pay; Interest and Fees; Interest Payment Dates; Interest and Fee Basis; Loan Accounts		46
	2.15	Notification of Advances, Interest Rates, Prepayments and Aggregate Commitment Reductions		48
	2.16	Lending Installations		48
	2.17	Non-Receipt of Funds by the Global Administrative Agent		48
	2.18	Termination Date		49
	2.19	Judgment Currency		49
	2.20	Termination as Borrower		49
ARTICLE III		CHANGE IN CIRCUMSTANCES		49
	3.1	Yield Protection		49
	3.2	Changes in Capital Adequacy Regulations		50
	3.3	Availability of Types of Advances		51
	3.4	Funding Indemnification		51
	3.5	Taxes		51
	3.6	Mitigation; Lender Statements; Survival of Indemnity		54
	3.7	Non-U.S. Reserve Costs or Fees		55
	3.8	Replacement of Affected Lenders		55

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ARTICLE IV		CONDITIONS PRECEDENT	56
	4.1	Initial Loans	56
	4.2	Each Loan	56
	4.3	Initial Advance to the Canadian Borrower	57
ARTICLE V		REPRESENTATIONS AND WARRANTIES	57
	5.1	Representations and Warranties	57
ARTICLE VI		COVENANTS	59
	6.1	Affirmative Covenants	59
	6.2	Negative Covenants	61
	6.3	Financial Covenants	66
ARTICLE VII		DEFAULTS	67
	7.1	Defaults	67
ARTICLE VIII		ACCELERATION, DEFAULTING LENDERS; WAIVERS, AMENDMENTS AND REMEDIES	69
	8.1	Remedies	69
	8.2	Defaulting Lender	69
	8.3	Amendments	71
	8.4	Preservation of Rights	72
ARTICLE IX		GENERAL PROVISIONS	72
	9.1	Survival of Representations	72
	9.2	Governmental Regulation	72
	9.3	Headings	73
	9.4	Entire Agreement	73
	9.5	Several Obligations; Benefits of this Agreement	73
	9.6	Expenses; Indemnification.	73
	9.7	Numbers of Documents	74
	9.8	Accounting	74
	9.9	Severability of Provisions	75
	9.10	Nonliability of Lenders	75
	9.11	CHOICE OF LAW AND SUBMISSION TO JURISDICTION	75
	9.12	WAIVER OF JURY TRIAL	75
	9.13	No Strict Construction	76
	9.14	USA PATRIOT ACT	76
	9.15	Service of Process	76
ARTICLE X		THE GLOBAL ADMINISTRATIVE AGENT	76
	10.1	Appointment; Nature of Relationship	76
	10.2	Powers	77
	10.3	General Immunity	77

ii

	10.4	No Responsibility for Loans, Creditworthiness, Recitals, Etc	77
	10.5	Action on Instructions of Lenders	77
	10.6	Employment of the Global Administrative Agent and Counsel	78
	10.7	Reliance on Documents; Counsel	78
	10.8	The Global Administrative Agent’s Reimbursement and Indemnification	78
	10.9	Rights as a Lender	78
	10.10	Lender Credit Decision	78
	10.11	Successor Global Administrative Agent	79
	10.12	Co-Agents, Documentation Agent, Syndication Agent, etc	79
ARTICLE XI		SETOFF; RATABLE PAYMENTS	79
	11.1	Setoff	79
	11.2	Ratable Payments	79
ARTICLE XII		GUARANTEE	80
ARTICLE XIII		BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS	83
	13.1	Successors and Assigns	83
	13.2	Participations.	83
	13.3	Assignments.	84
	13.4	Confidentiality	85
	13.5	Dissemination of Information	87
	13.6	Non-Use of HDFS’ Licensed Marks	87
ARTICLE XIV		NOTICES	87
	14.1	Giving Notice	87
	14.2	Change of Address	87
ARTICLE XV		COUNTERPARTS	88
	15.1	Counterparts	88

iii

EXHIBITS AND SCHEDULES

Exhibits

EXHIBIT A	—	Commitments (Definitions)
EXHIBIT B-1	—	Form of Syndicated Global Note (Definitions)
EXHIBIT B-2	—	Form of Bid Rate Note (Definitions)
EXHIBIT C	—	Form of Assignment Agreement (§13.3)
EXHIBIT D	—	List of Closing Documents (§ 4.1)
EXHIBIT E	—	Form of Syndicated Canadian Addendum (Definitions)
EXHIBIT F	—	Form of Commitment and Acceptance (§ 2.4(b))

iv

Schedules

Schedule I	—	Funding Protocols re: Syndicated Global Loans and Syndicated Canadian Loans (Definitions, § 2.6)
Schedule II	—	Funding Protocols re: Swing Line Loans (§ 2.9)
Schedule III	—	Mandatory Cost (Definitions)
Schedule IV	—	Intercompany Subordination Terms (Definitions)
Schedule 6.2.1(b)	—	Indebtedness (§ 6.2.1(b))
Schedule 6.2.2(c)	—	Liens (§ 6.2.2(c))

v

5-YEAR CREDIT AGREEMENT

This 5-Year Credit Agreement dated as of April 13, 2012 is entered into among Harley-Davidson, Inc., a Wisconsin corporation, Harley-Davidson Funding Corp., a Nevada corporation, Harley-Davidson Financial Services, Inc., a Delaware corporation, Harley-Davidson Financial Services Canada, Inc., a corporation organized and existing under the laws of Canada, Harley-Davidson Financial Services International, Inc., a Delaware corporation, Harley-Davidson Credit Corp., a Nevada corporation, the institutions from time to time a party hereto as Lenders, whether by execution of this Agreement or an assignment and assumption pursuant to Section 13.3, JPMorgan Chase Bank, N.A., as the Global Administrative Agent and the Global Swing Line Lender, Citibank, N.A., in its capacity as Syndication Agent and U.S. Bank National Association and The Royal Bank of Scotland plc, each in its capacity as a Documentation Agent. The parties hereto agree as follows:

ARTICLE I DEFINITIONS

1.1 Certain Defined Terms. In addition to the terms defined in other sections of this Agreement, the following terms used in this Agreement shall have the following meanings, applicable both to the singular and the plural forms of the terms defined:

As used in this Agreement:

“Absolute Rate Auction” has the meaning specified in Section 2.10(b)(i) hereof.

“Advance” means a Bid Rate Advance, Syndicated Canadian Advance or Syndicated Global Advance.

“Affiliate” of any Person means any other Person directly or indirectly controlling, controlled by or under common control with such Person. A Person shall be deemed to control another Person if the controlling Person possesses, directly or indirectly, the power to direct or cause the direction of the management or policies of the controlled Person, whether through ownership of stock, membership, ownership or other equity interests, by contract or otherwise.

“Agreed Currencies” means (i) Dollars, (ii) euro, (iii) so long as each such currency remains an Eligible Currency, Pounds Sterling, Canadian Dollars and Swiss Francs and (iv) any other Eligible Currency which any Global Borrower requests the Global Administrative Agent to include as an Agreed Currency hereunder and which is acceptable to each Syndicated Global Lender; provided that the Global Administrative Agent shall promptly notify each Syndicated Global Lender of each such request and each Syndicated Global Lender shall be deemed not to have agreed to each such request unless its written consent thereto has been received by the Global Administrative Agent within five (5) Business Days from the date of such notification by the Global Administrative Agent to such Syndicated Global Lender.

“Aggregate Commitment” means the aggregate of the Commitments of all the Syndicated Global Lenders, as reduced or increased from time to time pursuant to the terms hereof. The initial Aggregate Commitment is $675,000,000.

“Aggregate Outstanding Credit Exposure” is defined in Section 2.4(b)(ii) hereof.

“Agreement” means this 5-Year Credit Agreement, as it may be amended, restated or otherwise modified and in effect from time to time.

1

“Agreement Accounting Principles” means, subject to Section 9.8, generally accepted accounting principles as in effect from time to time in the United States, applied in a manner consistent with that used by Harley in its preparation of its audited financial statements for the year ended December 31, 2011 (except for changes to such application as are concurred on by Harley’s independent public accountants); provided that, if Harley notifies the Global Administrative Agent that Harley wishes to amend Section 6.3 to eliminate the effect of any change in Agreement Accounting Principles on the operation of such covenant (or if the Global Administrative Agent notifies Harley that the Required Lenders wish to amend Section 6.3 for such purpose), then Harley’s compliance with such section shall be determined on the basis of Agreement Accounting Principles in effect immediately before the relevant change in Agreement Accounting Principles became effective, until either such notice is withdrawn or such Section is amended in a manner satisfactory to Harley and the Required Lenders.

“Alternate Base Rate” means, for any day, a fluctuating interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) as shall be in effect from time to time, which rate per annum shall at all times be equal to the greatest of (a) the Prime Rate in effect on such day; (b) the sum of one-half of one percent (0.50%) and the Federal Funds Effective Rate in effect on such day; and (c) the Eurocurrency Rate for a one month Interest Period on such day (or, if such day is not a Business Day, the immediately preceding Business Day) plus 1%. For purposes hereof, “Prime Rate” shall mean the rate of interest per annum announced from time to time by JPMorgan Chase Bank, N.A. or its parent as its prime rate (which is not necessarily the lowest rate charged to any customers) in effect at its principal office in New York City, changing when and as said prime rate changes; provided that, with respect to Base Rate Loans and Base Rate Advances made by the Syndicated Canadian Banks to the Canadian Borrower, “Prime Rate” shall mean the rate of interest per annum announced from time to time by JPMorgan Chase Bank, N.A. as its prime rate (which is not necessarily the lowest rate charged to any customers) in effect at its principal office in Toronto, Ontario for loans in Dollars in Canada, changing when and as said prime rate changes. Each change in the Prime Rate shall be effective on the date such change is announced as being effective. “Federal Funds Effective Rate” shall mean, for any day, a fluctuating interest rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Global Administrative Agent from three Federal funds brokers of recognized standing selected by the Global Administrative Agent. If for any reason the Global Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate for any reason, including the inability of the Global Administrative Agent to obtain sufficient quotations in accordance with the terms hereof, the Alternate Base Rate shall be determined without regard to clause (b) of the first sentence of this definition until the circumstances giving rise to such inability no longer exist. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Eurocurrency Rate shall be effective on the effective date of such change.

“Applicable Agreed Currency” means (i) Dollars, euro and, so long as such currency remains an Eligible Currency, Canadian Dollars, Pounds Sterling and Swiss Francs in the case of Syndicated Global Loans to the U.S. Borrowers and (ii) any other Agreed Currency described in clause (iv) of the definition of Agreed Currency.

“Applicable Commitment Fee Rate” is defined in Section 2.6(b) hereof.

2

“Applicable Margin” is defined in Section 2.6(b) hereof.

“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arranger” means J.P. Morgan Securities LLC or Citigroup Global Markets, Inc. and “Arrangers” means, collectively, J.P. Morgan Securities LLC and Citigroup Global Markets, Inc.

“Authorized Officer” means any of the chief executive officer, chief financial officer, any vice president, controller, treasurer or any other officer of the relevant Borrower from time to time designated by an Authorized Officer in writing to the Global Administrative Agent as an Authorized Officer, acting singly.

“Bankers’ Acceptance Advance” is defined in the Syndicated Canadian Addendum.

“Bankers’ Acceptance Loan” is defined in the Syndicated Canadian Addendum.

“Bankruptcy Code” is defined in Article XII hereof.

“Base Rate Advance” means a Syndicated Global Advance or Syndicated Canadian Advance which in each case bears interest at the Alternate Base Rate.

“Base Rate Loan” means a Syndicated Global Loan, or portion thereof, or Syndicated Canadian Loan, or portion thereof, which in each case bears interest at the Alternate Base Rate.

“Bid Rate Advance” means a borrowing consisting of simultaneous Bid Rate Loans to a Global Borrower in the same currency from each of the Syndicated Global Lenders whose offer to make a Bid Rate Loan as part of such borrowing has been accepted by such Global Borrower under the applicable auction bidding procedure described in Section 2.10.

“Bid Rate Advance Borrowing Notice” is defined in Section 2.10(b)(i) hereof.

“Bid Rate Loan” means a loan by a Syndicated Global Lender to a Global Borrower as part of a Bid Rate Advance resulting from the applicable auction bidding procedure described in Section 2.10.

“Bid Rate Note” means a promissory note of a Global Borrower payable to the order of any Syndicated Global Lender, in substantially the form of Exhibit B-2 hereto, evidencing the indebtedness of such Global Borrower to such Syndicated Global Lender resulting from the Bid Rate Loans made by such Syndicated Global Lender to such Global Borrower.

“Bid Rate Reduction” means the reduction in availability under the Aggregate Commitment as a result of outstanding Bid Rate Loans.

“Borrower” means any of the U.S. Borrowers or the Canadian Borrower, and “Borrowers” means, collectively, the U.S. Borrowers and the Canadian Borrower.

3

“Borrowing Date” means a date on which an Advance or a Loan is made hereunder.

“Borrowing Notice” means a Syndicated Global Advance Borrowing Notice, a Syndicated Canadian Borrowing Notice, a Bid Rate Advance Borrowing Notice, a Canadian Swing Line Borrowing Notice, a U.K. Swing Line Borrowing Notice or a USD Swing Line Borrowing Notice.

“Business Day” means (i) with respect to any borrowing, payment or rate selection of Loans bearing interest at the Eurocurrency Rate, a day (other than a Saturday or Sunday) on which banks are generally open for commercial banking business in New York, New York and on which dealings in United States Dollars and the other Agreed Currencies are carried on in the London interbank market; (ii) with respect to any borrowing or payment of any Canadian Dollar denominated Loan (or any other Loan made by a Syndicated Canadian Bank to the Canadian Borrower), a day (other than a Saturday or Sunday) on which banks are generally open for commercial banking business in Toronto, Ontario; (iii) with respect to any borrowing or payment of any euro denominated Loan, a TARGET Settlement Day; (iv) with respect to any borrowing or payment of any Loan denominated in a currency other than Dollars, Canadian Dollars and Pounds Sterling, a day on which the applicable Eurocurrency Payment Office related to such currency is open for the transaction of domestic and foreign exchange business and (v) for all other purposes a day (other than a Saturday or Sunday) on which banks are generally open for commercial banking business in New York, New York.

“Buying Lender” is defined in Section 2.4(b)(ii) hereof.

“Calculation Date” means (a) the last Business Day of each calendar quarter and (b) solely with respect to any Agreed Currency other than Dollars for a requested new Advance for which an Exchange Rate was not established on the immediately preceding Calculation Date, the Business Day immediately preceding the date on which such Advance is to be made; provided that the Global Administrative Agent may in addition designate the last day of any calendar month as a Calculation Date if it reasonably determines that there has been significant volatility in the foreign currency markets since the most recent Calculation Date.

“Canadian Borrower” means Harley-Davidson Financial Services Canada, Inc., a corporation organized and existing under the laws of Canada, together with its successors and permitted assigns.

“Canadian Dollars” and “Cdn. $” means the lawful currency of Canada.

“Canadian Dollar Sublimit” means $250,000,000.

“Canadian Prime Rate” means, as of any day, the higher of (i) the rate of interest per annum publicly announced from time to time by the Global Administrative Agent at is principal office in Toronto, Ontario, as its “prime rate” for loans in Canadian Dollars in Canada, as in effect on such day, which rate may or may not be the lowest rate charged by the Global Administrative Agent to any of its customers and which Canadian Prime Rate shall change simultaneously with any change in such announced rate and (ii) the sum of one percent (1%) plus one-month CDOR in effect on such day.

“Canadian Prime Rate Advance” means an Advance which bears interest at the Canadian Prime Rate.

4

“Canadian Prime Rate Loan” means a Loan which bears interest at the Canadian Prime Rate.

“Canadian Swing Line Borrowing Notice” is defined in Section 2.9.2 hereof.

“Canadian Swing Line Commitment” means the obligation of the Global Swing Line Lender to make Canadian Swing Line Loans to the Canadian Borrower and the U.S. Borrowers, as requested by the Canadian Borrower or a U.S. Borrower pursuant to Section 2.9, up to a maximum principal amount of Cdn. $20,000,000 in the aggregate and on a cumulative basis at any one time outstanding.

“Canadian Swing Line Loan” means a Canadian Dollar denominated loan or Bankers’ Acceptance Loan made available to the Canadian Borrower or a U.S. Borrower by the Global Swing Line Lender pursuant to Section 2.9.2.

“Capitalized Lease” of a Person means any lease of Property by such Person as lessee which would be capitalized on a balance sheet of such Person prepared in accordance with Agreement Accounting Principles.

“Capitalized Lease Obligations” of a Person means the amount of the obligations of such Person under Capitalized Leases which would be capitalized on a balance sheet of such Person prepared in accordance with Agreement Accounting Principles in effect as of the date of this Agreement.

“CDOR” means the “CDOR Rate” (as such term is defined in the Syndicated Canadian Addendum).

“CDOR Advance” means a Canadian Dollar denominated Syndicated Canadian Advance which is a Bankers’ Acceptance Advance.

“CDOR Loan” means a Canadian Dollar denominated Syndicated Canadian Loan or Canadian Swing Line Loan (which is in each case a Bankers’ Acceptance Loan) to the Canadian Borrower, or a portion thereof.

“Change” is defined in Section 3.2 hereof.

“Change of Control” means any transaction or event as a result of which: (a) (i) any Person or two or more Persons acting in concert (other than any Related Person) shall have acquired beneficial ownership (within the meaning of Rule 13d-3 of the Commission under the Securities Exchange Act of 1934), directly or indirectly, of Voting Stock of Harley (or other securities convertible into such Voting Stock) representing 30% or more of the combined voting power of all Voting Stock of Harley; or (ii) during any period of up to 12 consecutive calendar months, commencing after the Closing Date, individuals who at the beginning of such 12-month period were directors of Harley shall cease for any reason to constitute a majority of the board of directors of Harley (except to the extent that individuals who, at the beginning of such 12-month period, were directors of Harley were replaced by individuals (x) elected by a majority of the remaining members of the board of directors of Harley or (y) nominated for election by a majority of the remaining members of the board of directors of Harley and thereafter elected as directors by the shareholders of Harley) or (b) in each case other than as a result of a transaction permitted under Section 6.2.3, (i) Harley, directly or through one or more Subsidiaries, shall cease to own of record and beneficially, with sole voting power, in the aggregate, at least fifty-

5

one percent (51%) of the issued and outstanding class or classes of Voting Stock of HDFS (such percentage measured by voting power rather than number of shares), (ii) HDFS, directly or through one or more Subsidiaries, shall cease to own of record and beneficially, with sole voting power, all of the issued and outstanding Voting Stock of HDCC, (iii) HDCC, directly or through one or more Subsidiaries, shall cease to own of record and beneficially, with sole voting power, all of the issued and outstanding Voting Stock of HDFC or (iv) HDFS, directly or through one or more Subsidiaries, shall cease to own of record and beneficially, with sole voting power, all of the issued and outstanding Voting Stock of any Foreign Borrower.

“Closing Date” means April 13, 2012.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

“Commission” means the Securities and Exchange Commission and any Person succeeding to the functions thereof.

“Commitment” means, for each Syndicated Global Lender, the obligation of such Syndicated Global Lender to make Syndicated Global Loans and to purchase participations in Swing Line Loans and Syndicated Canadian Loans in an amount not exceeding the Dollar Amount set forth on Exhibit A to this Agreement opposite its name thereon under the heading “Commitment” or contained in the assignment and assumption by which it became a Lender, as such amount may be modified from time to time pursuant to the terms of this Agreement or to give effect to any applicable assignment and assumption.

“Commitment Increase Notice” is defined in Section 2.4(b)(i) hereof.

“Company” means any Borrower or Guarantor, individually, and “Companies” means each of the Borrowers and Guarantors, collectively.

“Consolidated” refers to the consolidation of accounts (or Subsidiaries, as applicable) in accordance with Agreement Accounting Principles.

“Consolidated EBITDA” is defined in Section 6.3(A) hereof.

“Consolidated Equity” is defined in Section 6.3(A) hereof.

“Consolidated Finco Debt” is defined in Section 6.3(A) hereof.

“Consolidated Interest Expense” is defined in Section 6.3(A) hereof.

“Consolidated Net Income” of any Person for any period means the Consolidated net income (or loss) of such Person for such period, as shall be determined in accordance with Agreement Accounting Principles.

“Consolidated Net Worth” of any Person means such Person’s Consolidated shareholders’ equity, as shall be determined in accordance with Agreement Accounting Principles.

“Consolidated Tangible Net Worth” is defined in Section 6.3(A) hereof.

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“Consolidated Total Assets” means, as of the date of any determination thereof, the Consolidated total assets of Harley and its Subsidiaries as of such date, as shall be determined in accordance with Agreement Accounting Principles.

“Contingent Obligation”, as applied to any Person, means any Contractual Obligation, contingent or otherwise, of that Person with respect to any Indebtedness of another or other obligation or liability of another, including, without limitation, any such Indebtedness, obligation or liability of another directly or indirectly guaranteed, endorsed (otherwise than for collection or deposit in the ordinary course of business), co-made or discounted or sold with recourse by that Person, or in respect of which that Person is otherwise directly or indirectly liable, including Contractual Obligations (contingent or otherwise) arising through any agreement to purchase, repurchase, or otherwise acquire such Indebtedness, obligation or liability or any security therefor, or to provide funds for the payment or discharge thereof (whether in the form of loans, advances, stock purchases, capital contributions or otherwise), or to maintain solvency, assets, level of income, or other financial condition, or to make payment other than for value received. It is understood and agreed that the amount of liability in respect of any Contingent Obligation of any Person shall be deemed to be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation exists and (b) the maximum amount for which such Person may be liable pursuant to the terms of the instrument embodying such Contingent Obligation, unless such primary obligation and the maximum amount for which such Person may be liable are not stated or determinable, in which case the amount of such Contingent Obligation shall be such Person’s maximum reasonably anticipated liability in respect thereof as reasonably determined by Harley in good faith.

“Contractual Obligation”, as applied to any Person, means any provision of any equity or debt securities issued by that Person or any indenture, mortgage, deed of trust, security agreement, pledge agreement, guaranty, contract, undertaking, agreement or instrument, in any case in writing, to which that Person is a party or by which it or any of its properties is bound, or to which it or any of its properties is subject.

“Conversion/Continuation Notice” is defined in Section 2.8(D) hereof.

“Cure Loan” is defined in Section 8.2 hereof.

“Default” means an event described in Article VII hereof.

“Defaulting Lender” means any Lender, as determined by the Global Administrative Agent, that has within three (3) Business Days of the date required to be funded or paid (a) failed to (i) fund its Pro Rata Share of any Advance or Loan or (ii) pay over to the Global Administrative Agent or any Lender any other amount required to be paid by it hereunder, unless, in the case of clause (i) above, such Lender notifies the Global Administrative Agent in writing that such failure is the result of such Lender’s good faith determination that a condition precedent to funding (specifically identified and including the particular default, if any) has not been satisfied, (b) notified any Company, the Global Administrative Agent, the Global Swing Line Lender or any Lender in writing that it does not intend to comply with any of its funding obligations under this Agreement or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement (unless such writing or public statement states that such position is based on such Lender’s good faith determination that a condition precedent to funding (specifically identified and including the particular default, if any) cannot be satisfied) or generally under other agreements in which it commits to extend credit, (c) failed, within three (3) Business Days after written request by the Global Administrative Agent,

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to provide a certification in writing from an authorized officer of such Lender that it will comply with the terms of this Agreement relating to its obligations to fund prospective Loans and participations in then outstanding Swing Line Loans (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon the Global Administrative Agent’s receipt of such certification in form and substance reasonably satisfactory to it), (d) otherwise failed to pay over to the Global Administrative Agent or any other Lender any other amount required to be paid by it hereunder within three (3) Business Days of the date when due, unless the subject of a good faith dispute, or (e) become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or custodian, appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a direct or indirect parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment; provided, that a Lender shall not become a Defaulting Lender solely as the result of (x) the acquisition or maintenance of an ownership interest in such Lender or a Person controlling such Lender or (y) the exercise of control over a Lender or a Person controlling such Lender, in each case, by a Governmental Authority or an instrumentality thereof.

“Dollar” and “$” means dollars in the lawful currency of the United States of America.

“Dollar Amount” of any currency at any date shall mean (i) the amount of such currency if such currency is Dollars or (ii) the Equivalent Amount of Dollars if such currency is any currency other than Dollars.

“Domestic Subsidiary” means a Subsidiary organized under the laws of a jurisdiction located in the United States of America.

“Earnouts” means any “earnouts” or similar obligations accrued in connection with any acquisition determined in accordance with generally accepted accounting principles.

“Effective Commitment Amount” is defined in Section 2.4(b)(i) hereof.

“Eligible Currency” means any currency other than Dollars or euro that is readily available, freely traded, in which deposits are customarily offered to banks in the London interbank market, convertible into Dollars in the international interbank market and as to which an Equivalent Amount may be readily calculated. If, after the designation by the Lenders of any currency as an Agreed Currency, currency control or other exchange regulations are imposed in the country in which such currency is issued with the result that different types of such currency are introduced, such country’s currency is, in the determination of the Global Administrative Agent, no longer readily available or freely traded or as to which, in the determination of the Global Administrative Agent, an Equivalent Amount is not readily calculable, then the Global Administrative Agent shall promptly notify the Syndicated Global Lenders and each Global Borrower, and such country’s currency shall no longer be an Agreed Currency until such time as all of the Syndicated Global Lenders (in the case of an Agreed Currency) agree to reinstate such country’s currency as an Agreed Currency and promptly, but in any event within five (5) Business Days of receipt of such notice from the Global Administrative Agent, the applicable Borrower shall repay all Loans in such affected currency or convert such Loans into Loans in Dollars or another Agreed Currency, subject to the other terms contained in Article II.

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“Environmental Action” means any action, suit, demand, demand letter, claim, notice of non-compliance or violation, notice of liability or potential liability, investigation, proceeding, consent order or consent agreement relating in any way to any Environmental Law, Environmental Permit or Hazardous Materials or arising from alleged injury or threat of injury to the environment, including, without limitation, (a) by any governmental or regulatory authority for enforcement, cleanup, removal, response, remedial or other actions or damages and (b) by any governmental or regulatory authority or any third party for damages, contribution, indemnification, cost recovery, compensation or injunctive relief.

“Environmental Law” means any federal, state, local or foreign statute, law, ordinance, rule, regulation, code, order, judgment, decree or judicial or agency interpretation, policy or guidance relating to pollution or protection of the environment or natural resources, including, without limitation, those relating to the use, handling, transportation, treatment, storage, disposal, release or discharge of Hazardous Materials.

“Environmental Permit” means any permit, approval, identification number, license or other authorization required under any Environmental Law.

“Equivalent Amount” of any currency other than Dollars at any date shall mean the equivalent in Dollars of such currency, calculated on the basis of the Exchange Rate then in effect with respect to such currency.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

“ERISA Affiliate” means any Person that for purposes of Title IV of ERISA is a member of Harley’s controlled group, or under common control with Harley, within the meaning of Section 414 of the Code.

“ERISA Event” means (a) (i) the occurrence of a reportable event, within the meaning of Section 4043 of ERISA, with respect to any Plan unless the 30-day notice requirement with respect to such event has been waived by the PBGC, or (ii) the requirements of subsection (1) of Section 4043(b) of ERISA (without regard to subsection (2) of such Section) are met with a contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan, and an event described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur with respect to such Plan within the following 30 days; (b) the application for a minimum funding waiver with respect to a Plan; (c) the provision by the administrator of any Plan of a notice of intent to terminate such Plan pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect to a plan amendment referred to in Section 4041(e) of ERISA); (d) the cessation of operations at a facility of Harley or any ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA; (e) the withdrawal by Harley or any ERISA Affiliate from a Multiple Employer Plan during a plan year for which it was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions for the imposition of a lien under Section 302(f) of ERISA shall have been met with respect to any Plan; (g) the adoption of an amendment to a Plan requiring the provision of security to such Plan pursuant to Section 307 of ERISA; or (h) the institution by the PBGC of proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or the occurrence of any event or condition described in Section 4042 of ERISA that constitutes grounds for the termination of, or the appointment of a trustee to administer, a Plan.

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“EURIBOR” means the applicable interest rate per annum determined by the Banking Federation of the European Union for deposits in euro appearing on the applicable EURIBOR Reference Page on such day (or if such day is not a Business Day, on the immediately preceding Business Day) as of the applicable EURIBOR Fixing Time, in the approximate amount of the pro rata share of the Global Administrative Agent (or any of its Affiliates) of the applicable Eurocurrency Rate Advance or Swing Line Loan, and, in each case, having a maturity approximately equal to the requested Interest Period; provided that, (i) if the applicable EURIBOR Reference Page is not available to the Global Administrative Agent at or about the EURIBOR Fixing Time for any reason, the applicable EURIBOR for the relevant Interest Period shall instead be the applicable rate for deposits in euro offered to leading banks in the euro-zone interbank market as reported by any other generally recognized financial information service specified by the Global Administrative Agent as of the applicable EURIBOR Fixing Time, and having a maturity approximately equal to such Interest Period, and (ii) if no such rate is available, the applicable EURIBOR for the relevant Interest Period shall instead be the interest rate per annum equal to the arithmetic mean determined by the Global Administrative Agent (rounded upwards to the nearest .001%) of the rates per annum at which deposits in euro are offered by three (3) leading banks in the euro-zone interbank market at the applicable EURIBOR Fixing Time to other leading banks in the euro-zone interbank market in the approximate amount of JPMorgan Chase Bank, N.A.’s (or any of its Affiliates) relevant Eurocurrency Rate Loan or Swing Line Loan having a maturity approximately equal to such Interest Period.

“EURIBOR Fixing Time” means the relevant currency fixing date and/or time described in Schedule I and Schedule II.

“EURIBOR Reference Page” means the relevant page on the relevant screen described in Schedule I and Schedule II, including in each case any successor or substitute screen, as applicable, providing rate quotations comparable to those currently provided on such screen, as determined by the Global Administrative Agent from time to time for purposes of providing quotations of interest rates at which deposits in euro are offered to leading banks in the euro-zone interbank market.

“euro” and “€” means the single currency of the Participating Member States.

“Eurocurrency Base Rate” means, with respect to any Eurocurrency Rate Advance or any Swing Line Loan for any specified Interest Period, or a Bid Rate Advance pursuant to an Indexed Rate Auction for an Interest Period designated by the relevant Borrower, in each case with respect to an Applicable Agreed Currency, (i) LIBOR with respect to any such currency other than euro and (ii) EURIBOR solely with respect to euro.

“Eurocurrency Payment Office” of the Global Administrative Agent shall mean, for each of the Agreed Currencies, the office, branch or affiliate of the Global Administrative Agent, as it may from time to time specify to Harley and each Syndicated Global Lender as its Eurocurrency Payment Office.

“Eurocurrency Rate” means, with respect to a Swing Line Loan, a Eurocurrency Rate Loan and a Eurocurrency Rate Advance for the relevant Interest Period, the sum of (i) the quotient of (a) the Eurocurrency Base Rate applicable to such Interest Period, divided by (b) one minus the Reserve Requirement (expressed as a decimal) applicable to such Interest Period, plus (ii) the Applicable Margin, plus (iii) in the case of Loans and Advances by a Lender from its office or branch in England or any Participating Member State, the Mandatory Cost.

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“Eurocurrency Rate Advance” means a Syndicated Global Advance or Syndicated Canadian Advance which bears interest at the Eurocurrency Rate.

“Eurocurrency Rate Loan” means a Swing Line Loan, Syndicated Global Loan or Syndicated Canadian Loan, or portion thereof, which bears interest at the Eurocurrency Rate.

“Exchange Rate” means with respect to any currency other than Dollars on a particular date, the rate at which such currency may be exchanged into Dollars, calculated on the basis of the arithmetical mean of the buy and sell spot rates of exchange of the Global Administrative Agent in the London interbank market (or other market where the Global Administrative Agent’s foreign currency exchange operations in respect of such currency are then being conducted) for such currency at or about 1:00 p.m. local time, on such date for the purchase of Dollars with such currency; provided, however, that if at the time of any such determination, for any reason, no such spot rate is being quoted, the Global Administrative Agent may use any reasonable method it deems appropriate to determine such rate, and such determination shall be conclusive absent manifest error.

“Excluded Taxes” means, in the case of each Lender or applicable Lending Installation and the Global Administrative Agent, (a) taxes imposed on (or measured by) its overall net income, and franchise taxes imposed on it, by (i) the jurisdiction under the laws of which such Lender or the Global Administrative Agent is incorporated or organized or (ii) the jurisdiction in which the Global Administrative Agent’s or such Lender’s principal executive office or such Lender’s applicable Lending Installation is located and (b) taxes imposed under FATCA.

“Existing Credit Agreement” means that certain 3-Year Credit Agreement dated as of April 29, 2010 among inter alia Harley, HDFC, the guarantors party thereto, the lenders party thereto and JPMorgan Chase Bank, N.A. as global administrative agent, as such agreement has been amended or otherwise modified prior to the Closing Date.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with) and any current or future regulations or official interpretations thereof.

“Federal Funds Effective Rate” shall have the meaning assigned to that term in the definition of Alternate Base Rate above.

“Finance Receivables” means dealer wholesale receivables, retail installment contracts, promissory notes, retail leases, charge accounts or other receivables, chattel paper or other similar financial assets originated, acquired or serviced in the ordinary course of business by any of the Companies or their Subsidiaries and shall include all related collateral and assets and any retained assets in respect of any of the foregoing.

“Finance Receivables Subsidiary” means a special purpose, bankruptcy remote corporation, partnership, limited liability company or trust which is wholly-owned, directly or indirectly, by any one or more of the Companies, and which is formed for the sole and exclusive purpose of (i) purchasing or otherwise acquiring Finance Receivables from one or more of the Companies or their respective Subsidiaries, (ii) financing such purchases or otherwise facilitating a Permitted Finance Receivables Securitization and (iii) conducting activities related thereto.

“Finco” means HDFS, HDCC and HDFC.

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“Finco Guarantor” means any of HDCC or HDFSI and “Finco Guarantors” means each of HDCC and HDFSI and in each such case their respective successors and permitted assigns.

“Finco Leverage Ratio” is defined in Section 6.3(A) hereof.

“Fitch” is defined in Section 2.6(b) hereof.

“Fixed Rate Advance” means a Eurocurrency Rate Advance or a CDOR Advance.

“Fixed Rate Loan” means a Eurocurrency Rate Loan or a CDOR Loan, as applicable.

“Fixed Rate Swing Line Loan” means a U.K. Swing Line Loan which bears interest at the Eurocurrency Rate or a Canadian Swing Line Loan which bears interest at CDOR.

“Floating Rate” means the Canadian Prime Rate or the Alternate Base Rate, as applicable.

“Floating Rate Advance” means a Canadian Prime Rate Advance or Base Rate Advance, as applicable.

“Floating Rate Loan” means a Syndicated Global Loan or Syndicated Canadian Loan, or portion thereof, or a Swing Line Loan, in each case which bears interest at the Alternate Base Rate, the Canadian Prime Rate or any other floating rate, as applicable, plus the Floating Rate Margin (if any).

“Floating Rate Margin” means a rate per annum equal to the amount (if any) by which the Applicable Margin exceeds 1.00%.

“Foreign Borrower” means the Canadian Borrower.

“Global Administrative Agent” means JPMorgan Chase Bank, N.A. (including any office, branch or affiliate of JPMorgan Chase Bank, N.A.) in its capacity as contractual representative for itself and the Lenders pursuant to Article X hereof and any successor Global Administrative Agent appointed pursuant to Article X hereof.

“Global Borrower” means any of the U.S. Borrowers and “Global Borrowers” means, collectively, the U.S. Borrowers, in each case together with its respective successors and permitted assigns.

“Global Rate Option” means the Eurocurrency Rate or Alternate Base Rate.

“Global Swing Line Lender” means JPMorgan Chase Bank, N.A. (including any office, branch or affiliate of JPMorgan Chase Bank, N.A.); provided that the Global Swing Line Lender in respect of Canadian Swing Line Loans or USD Swing Line Loans to the Canadian Borrower shall mean JPMorgan Chase Bank, N.A. or any of its offices, branches and affiliates, in each case, resident in Canada within the meaning of the Income Tax Act (Canada).

“Governmental Authority” means any nation or government, any monetary authority, any federal, state, provincial, local or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

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“Guarantee” is defined in Article XII hereof.

“Guarantor” means each of HDFC and HDFS and each of the Finco Guarantors and in each such case their respective successors and permitted assigns.

“Harley” means Harley-Davidson, Inc., a Wisconsin corporation, and its successors and assigns.

“Hazardous Materials” means (a) petroleum and petroleum products, byproducts or breakdown products, radioactive materials, asbestos-containing materials, polychlorinated biphenyls and radon gas and (b) any other chemicals, materials or substances designated, classified or regulated as hazardous or toxic or as a pollutant or contaminant under any Environmental Law.

“HDCC” means Harley-Davidson Credit Corp., a Nevada corporation, and its successors and permitted assigns.

“HDFC” means Harley-Davidson Funding Corp., a Nevada corporation, and its successors and permitted assigns.

“HDFS” means Harley-Davidson Financial Services, Inc., a Delaware corporation, and its successors and permitted assigns.

“HDFSI” means Harley-Davidson Financial Services International, Inc., a Delaware corporation, and its successors and permitted assigns.

“Hedging Obligations” of a Person means any and all obligations of such Person, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (i) any and all agreements, devices or arrangements designed to protect at least one of the parties thereto from the fluctuations of interest rates, commodity prices, exchange rates or forward rates applicable to such party’s assets, liabilities or exchange transactions, including, but not limited to, dollar-denominated or cross-currency interest rate exchange agreements, forward currency exchange agreements, interest rate cap or collar protection agreements, forward rate currency or interest rate options, puts and warrants, and (ii) any and all cancellations, buy backs, reversals, terminations or assignments of any of the foregoing.

“Indebtedness” of any Person means, without duplication, (i) any indebtedness of such Person, contingent or otherwise, (a) in respect of borrowed money including all principal, interest, fees and expenses with respect thereto (whether or not the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof), or (b) evidenced by bonds, notes, acceptances, debentures or other instruments or letters of credit (or reimbursement obligations with respect thereto) or representing the balance deferred and unpaid of the purchase price of any Property (including pursuant to Capitalized Leases) or services, if and to the extent any of the foregoing indebtedness would appear as a liability upon a balance sheet of such Person prepared in accordance with Agreement Accounting Principles (except that any such balance that constitutes a trade payable and/or an accrued liability arising in the ordinary course of business shall not be considered Indebtedness); and (ii) to the extent not otherwise included in clause (i)

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above, (a) interest accruing after the commencement of any bankruptcy, insolvency, receivership or similar proceedings and other interest that would have accrued but for the commencement of such proceedings, (b) any Capitalized Lease Obligations, (c) obligations, whether or not assumed, secured by Liens or payable out of the proceeds or production from Property now or hereafter owned or acquired by such Person (excluding in any event obligations in respect of Permitted Finance Receivables Securitizations to the extent such obligations would not appear as a liability upon a balance sheet of such Person prepared in accordance with Agreement Accounting Principles), (d) Contingent Obligations and (e) net Hedging Obligations. The amount of Indebtedness of any Person at any date shall be without duplication (i) the outstanding balance at such date of all uncontingent obligations as described above and the liability of any such Contingent Obligations at such date and (ii) in the case of Indebtedness of others secured by a Lien to which the Property or assets owned or held by such Person is subject, the lesser of the fair market value at such date of any asset subject to a Lien securing the Indebtedness of others and the amount of the Indebtedness secured (provided that if such Person has not assumed or become liable for the payment of such Indebtedness, it shall be taken into account only to the extent of the book value or fair market value, whichever is greater, of the Property subject to such Indebtedness). Notwithstanding the foregoing, Indebtedness shall exclude (i) obligations in respect of Permitted Finance Receivables Securitizations to the extent such obligations would not appear as a liability upon a balance sheet of such Person prepared in accordance with Agreement Accounting Principles, (ii) all intercompany indebtedness, obligations and Contingent Obligations, all to the extent owing by and among one or more of the Companies and their Subsidiaries, (iii) all obligations under the Support Agreement or other support agreements among one or more of the Companies, (iv) Earnouts and (v) any Indebtedness that has been defeased, provided that funds in an amount equal to all such Indebtedness (including interest and any other amounts required to be paid to the holders thereof in order to give effect to such defeasance) have been irrevocably deposited with a trustee for the benefit of the relevant holders of such Indebtedness. The amount of Indebtedness of Harley and any Subsidiary hereunder shall be calculated without duplication of guaranty obligations of Harley or any Subsidiary in respect thereof.

“Indemnified Matters” is defined in Section 9.6(B) hereof.

“Indemnitees” is defined in Section 9.6(B) hereof.

“Indexed Rate Auction” is defined in Section 2.10(b)(i) hereof.

“Information Memorandum” means the Confidential Information Memorandum dated March 2012 relating to the Borrowers and the Transactions.

“Interest Coverage Ratio” is defined in Section 6.3(A) hereof.

“Interest Period” means, (a) with respect to a Eurocurrency Rate Loan, a period of one (1), two (2), three (3) or six (6) months (or such other period of time as is consented to by each of the Lenders) commencing on a Business Day selected by the applicable Borrower pursuant to this Agreement and (b) with respect to a CDOR Loan, a period selected by the Canadian Borrower in accordance with the Syndicated Canadian Addendum. For Eurocurrency Rate Loans, such Interest Period shall end on (but exclude) the day which corresponds numerically to such date one (1), two (2), three (3) or six (6) months thereafter (or such other period of time as is consented to by each of the Lenders); provided, however, that if there is no such numerically corresponding day in such next, second, third or sixth (or other applicable) succeeding month, such Interest Period shall end on the last Business Day of such next, second, third or sixth (or other applicable)

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succeeding month. If an Interest Period would otherwise end on a day which is not a Business Day, such Interest Period shall end on the next succeeding Business Day; provided, however, that for Eurocurrency Rate Loans, if said next succeeding Business Day falls in a new calendar month, such Interest Period shall end on the immediately preceding Business Day.

“IRS” means the Internal Revenue Service and any Person succeeding to the functions thereof.

“Lenders” means the lending institutions listed on the signature pages of this Agreement or a Syndicated Canadian Addendum and any other Person that shall have become a Lender hereunder pursuant to Section 2.4(b), including each Syndicated Global Lender, the Global Swing Line Lender, each Syndicated Canadian Bank and their respective successors and assigns.

“Lender Increase Notice” is defined in Section 2.4(b)(i) hereof.

“Lending Installation” means, with respect to a Lender or the Global Administrative Agent, any office, branch, subsidiary or affiliate of such Lender or the Global Administrative Agent.

“LIBOR” means the applicable British Bankers’ Association Interest Settlement Rate for deposits in the Applicable Agreed Currency or U.K. Swing Line Currency appearing on the applicable LIBOR Reference Page for such Agreed Currency or U.K. Swing Line Currency as of the applicable LIBOR Fixing Time, in the approximate amount of the pro rata share of the Global Administrative Agent (or any of its Affiliates) of the applicable Eurocurrency Rate Loan, Syndicated Canadian Loan or Swing Line Loan or in the case of an Indexed Rate Auction in an amount equal to $1,000,000, and, in each case, having a maturity approximately equal to the requested Interest Period or interest period; provided that, (i) if the applicable LIBOR Reference Page for such Agreed Currency or U.K. Swing Line Currency is not available to the Global Administrative Agent for any reason at or about the LIBOR Fixing Time, the applicable LIBOR for the relevant Interest Period or interest period shall instead be the applicable British Bankers’ Association Interest Settlement Rate for deposits in the Applicable Agreed Currency or U.K. Swing Line Currency offered to leading banks as reported by any other generally recognized financial information service specified by the Global Administrative Agent as of the applicable LIBOR Fixing Time, and having a maturity approximately equal to such Interest Period or interest period, and (ii) if no such British Bankers’ Association Interest Settlement Rate is available, the applicable LIBOR for the relevant Interest Period or interest period shall instead be the rate determined by the Global Administrative Agent to be the rate at which JPMorgan Chase Bank, N.A. offers to place deposits in the Applicable Agreed Currency or U.K. Swing Line Currency with first-class banks in the London interbank market at the applicable LIBOR Fixing Time, in the approximate amount of JPMorgan Chase Bank, N.A.’s (or any of its Affiliates) relevant Eurocurrency Rate Loan, Swing Line Loan or Syndicated Canadian Loan or in the case of an Indexed Rate Auction in an amount equal to $1,000,000 and, in each case, having a maturity approximately equal to such Interest Period or interest period.

“LIBOR Fixing Time” means the relevant currency fixing date and/or time described in Schedule I and Schedule II.

“LIBOR Reference Page” means the relevant page on the relevant screen described in Schedule I and Schedule II, including in each case any successor or substitute screen, as applicable, providing rate quotations comparable to those currently provided on such screen, as determined by the Global Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to deposits in the London interbank market in the relevant currency.

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“Lien” means any security interest, lien (statutory or other) or other similar charge or encumbrance of any kind or nature whatsoever (including, without limitation, the interest of a vendor or lessor under any conditional sale, Capitalized Lease or other title retention agreement (excluding operating leases)).

“Loan” means a Syndicated Global Loan, a Bid Rate Loan, a Syndicated Canadian Loan or a Swing Line Loan.

“Loan Account” is defined in Section 2.14(E) hereof.

“Loan Documents” means this Agreement, the Syndicated Canadian Addendum, the Notes, the Support Agreement and all other documents, instruments and agreements executed pursuant thereto or contemplated thereby, in each case as the same may be amended, restated or otherwise modified and in effect from time to time.

“Mandatory Cost” is described in Schedule III hereto.

“Material Adverse Change” means any material adverse change in the business, assets, operations or financial condition of Harley and its Subsidiaries taken as a whole (excluding changes or effects in connection with specific events (and not general economic or industry conditions) applicable specifically to Harley and/or its Subsidiaries as disclosed in any Annual Report on Form 10-K, Quarterly Report on Form 10-Q or Current Report on Form 8-K filed with or furnished to the Commission prior to the Closing Date).

“Material Adverse Effect” means any event, development or circumstance that has had a material adverse effect on (a) the business, assets, operations or financial condition of Harley and its Subsidiaries taken as a whole (excluding changes or effects in connection with specific events (and not general economic or industry conditions) applicable specifically to Harley and/or its Subsidiaries as disclosed in any Annual Report on Form 10-K, Quarterly Report on Form 10-Q or Current Report on Form 8-K filed with or furnished to the Commission prior to the Closing Date) or (b) the validity or enforceability of any of the Loan Documents or the rights or remedies of the Global Administrative Agent and the Lenders thereunder.

“Material Subsidiary” means, at any time, any Subsidiary of Harley with a Net Worth equal to or greater than 10% of Consolidated Net Worth of Harley (as of the end of the most recent fiscal quarter), or Net Income (for the period of four consecutive fiscal quarters then most recently ended during which the Consolidated Net Income of Harley was not a loss) equal to or greater than 10% of Consolidated Net Income (for such period) of Harley; provided that, if at any time the aggregate amount of Harley’s Consolidated Net Income for such period attributable to Subsidiaries that are not Material Subsidiaries exceeds thirty percent (30%) of Harley’s Consolidated Net Income for such period, Harley shall designate sufficient Subsidiaries as “Material Subsidiaries” to eliminate such excess, and such designated Subsidiaries shall for all purposes of this Agreement constitute Material Subsidiaries until such designation is no longer necessary to comply with this proviso; provided further, that no Subsidiary of Harley that is not a Consolidated Subsidiary of Harley shall be deemed to be a “Material Subsidiary”.

“Moody’s” is defined in Section 2.6(b) hereof.

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“Moody’s Rating” is defined in Section 2.6(b) hereof.

“Multiemployer Plan” means a multiemployer plan, as defined in Section 4001(a)(3) of ERISA, to which Harley or any ERISA Affiliate is making or accruing an obligation to make contributions, or has within any of the preceding five plan years made or accrued an obligation to make contributions.

“Multiple Employer Plan” means a single employer plan, as defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of Harley or any ERISA Affiliate and at least one Person other than Harley and the ERISA Affiliates or (b) was so maintained and in respect of which Harley or any ERISA Affiliate could have liability under Section 4064 or 4069 of ERISA in the event such plan has been or were to be terminated.

“Net Income” of any Person for any period means the net income (or loss) of such Person for such period, as shall be determined in accordance with Agreement Accounting Principles.

“Net Worth” of any Person means such Person’s consolidated shareholders’ equity, as shall be determined in accordance with Agreement Accounting Principles.

“New Currency” is defined in Section 2.12 hereof.

“Non Pro Rata Loan” is defined in Section 8.2 hereof.

“Non-U.S. Lender” is defined in Section 3.5(iv) hereof.

“Notes” means the Syndicated Global Notes, the Syndicated Canadian Notes and the Bid Rate Notes.

“Notice of Assignment” is defined in Section 13.3(B) hereof.

“Obligations” means all Loans, advances, debts, liabilities, obligations, covenants and duties owing by any Borrower to the Global Administrative Agent, either Arranger, any Lender, the Global Swing Line Lender, any Syndicated Canadian Bank, any Affiliate of any of the foregoing or any Indemnitee, of any kind or nature, present or future, arising under this Agreement, the Notes or any other Loan Document, whether or not evidenced by any note, guaranty or other instrument, whether or not for the payment of money, whether arising by reason of an extension of credit, loan, guaranty, indemnification, or in any other manner, whether direct or indirect (including those acquired by assignment), absolute or contingent, due or to become due, now existing or hereafter arising and however acquired. The term includes, without limitation, all interest, charges, expenses, fees, attorneys’ fees and disbursements, paralegals’ fees (in each case whether or not allowed), and any other sum chargeable to any Borrower under this Agreement or any other Loan Document.

“Original Currency” is defined in Section 2.12 hereof.

“Other Taxes” is defined in Section 3.5 hereof.

“Outstanding Credit Exposure” is defined in Section 2.4(b)(ii) hereof.

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“Overnight Foreign Currency Rate” means, for any amount payable in a currency other than Dollars, the rate of interest per annum as determined by the Global Administrative Agent (or in the case of any amount payable on a Swing Line Loan, the Global Swing Line Lender) at which overnight or weekend deposits in the relevant currency (or if such amount due remains unpaid for more than three Business Days, then for such other period of time as the Global Administrative Agent or Global Swing Line Lender (as applicable) may elect) for delivery in immediately available and freely transferable funds would be offered by the Global Administrative Agent or Global Swing Line Lender (as applicable) to major banks in the interbank market upon request of such major banks for the relevant currency as determined above and in an amount comparable to the unpaid principal amount of the related Loan.

“Participant Register” is defined in Section 13.2(D) hereof.

“Participants” is defined in Section 13.2(A) hereof.

“Participating Member State” means any member state of the European Union that adopts or has adopted the euro as its lawful currency in accordance with legislation of the European Union relating to economic and monetary union.

“Payment Date” means the last Business Day of each calendar quarter.

“PBGC” means the Pension Benefit Guaranty Corporation, or any successor thereto.

“Permitted Finance Receivables Securitization” means any financial asset financing program or facility providing for the sale, conveyance, pledge or other transfer of Finance Receivables by any of the Companies or their respective Subsidiaries to a trust or to one or more limited purpose finance companies, special purpose entities or financial institutions or other third party investors or financiers, either directly or through one or more Subsidiaries.

“Permitted Liens” means such of the following as to which no enforcement, collection, execution, levy or foreclosure proceeding shall have been commenced: (a) Liens for taxes, assessments and governmental charges or levies to the extent not required to be paid under Section 6.1.2 hereof; (b) Liens imposed by law, such as materialmen’s, mechanics’, carriers’, workmen’s and repairmen’s Liens and other similar Liens arising in the ordinary course of business securing obligations that are either (i) not overdue for a period of more than forty-five (45) days or (ii) being contested in good faith and by proper proceedings and as to which appropriate reserves are being maintained; (c) pledges or deposits to secure obligations under workers’ compensation laws, unemployment insurance or similar legislation or to secure public or statutory obligations; (d) easements, rights of way and other encumbrances on title to real Property that do not render title to the Property encumbered thereby unmarketable or materially adversely affect the use of such Property for its present purposes; (e) Liens of attachment or judgment with respect to judgments, writs or warrants of attachment, or similar process against any of the Companies or any of their Subsidiaries which do not constitute a Default under Section 7.1(f); (f) Liens arising from leases, subleases or licenses granted to others which do not interfere in any material respect with the business of the Companies or any of their Subsidiaries; (g) any interest or title of the lessor in the Property subject to any operating lease entered into by any of the Companies or any of their Subsidiaries in the ordinary course of business; (h) Liens in respect of an agreement to dispose of any asset, to the extent such disposal is permitted by this Agreement; (i) Liens arising under any retention of title arrangements entered into in the ordinary course of business or over goods or documents of title to goods arising in the ordinary course of documentary credit transactions; (j) Liens arising due to any cash pooling, netting or composite

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account arrangements between any one or more of the Borrowers and any of their Subsidiaries or between any one or more of such entities and one or more banks or other financial institutions where any such entity maintains deposits; and (k) customary rights of set off, revocation, refund or chargeback or similar rights under deposit disbursement, concentration account agreements or under the UCC (or comparable foreign law) or arising by operation of law of banks or other financial institutions where any Borrower or any of its Subsidiaries maintains deposit, disbursement or concentration accounts in the ordinary course of business.

“Permitted Securitization Recourse Obligations” of a Person means recourse obligations of such Person with respect to Finance Receivables sold, pledged or otherwise transferred pursuant to a Permitted Finance Receivables Securitization, if and only if such recourse obligations constitute performance guarantees and/or indemnification or repurchase obligations arising as a result of the breach by such Person of a representation, warranty or covenant in respect of such Finance Receivables or otherwise in respect of losses, costs or expenses arising as a result of such Permitted Finance Receivables Securitizations, in each case other than (A) recourse for Finance Receivables uncollectible because of bankruptcy, insolvency, lack of creditworthiness or other mere failure to pay on the part of the obligor with respect to such Finance Receivable, and (B) indemnification or repurchase obligations arising from a representation, warranty or covenant relating to the payment of any Indebtedness incurred or securities issued in connection with such Permitted Finance Receivables Securitization.

“Person” means any natural person, corporation, firm, company, joint venture, partnership, association, enterprise, trust or other entity or organization, or any government or political subdivision or any agency, department or instrumentality thereof.

“Plan” means a Single Employer Plan or a Multiple Employer Plan.

“Pounds Sterling” means the lawful currency of the United Kingdom.

“Prime Rate” shall have the meaning assigned to that term in the definition of Alternate Base Rate above.

“Pro Rata Share” means, with respect to any Syndicated Global Lender, the percentage obtained by dividing (A) such Syndicated Global Lender’s Commitment at such time (in each case, as adjusted from time to time in accordance with the provisions of this Agreement) by (B) the Aggregate Commitment at such time; provided, however, that, if the Commitments have been terminated pursuant to the terms of this Agreement, “Pro Rata Share” means, with respect to any Syndicated Global Lender, the percentage obtained by dividing (A) the aggregate outstanding principal Dollar Amount of such Syndicated Global Lender’s (i) Syndicated Global Loans plus (ii) share of the obligation to purchase participations in Swing Line Loans and Syndicated Canadian Loans by (B) the aggregate outstanding principal Dollar Amount of all Syndicated Global Loans, Swing Line Loans and Syndicated Canadian Loans.

“Property” of a Person means any and all property, whether real, personal, tangible, intangible, or mixed, of such Person, or other assets owned, leased or operated by such Person.

“Proposed New Lender” is defined in Section 2.4(b)(i) hereof.

“Purchasers” is defined in Section 13.3(A) hereof.

“Register” is defined in Section 13.3(C) hereof.

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“Regulation D” means Regulation D of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor thereto or other regulation or official interpretation of said Board of Governors relating to reserve requirements applicable to member banks of the Federal Reserve System.

“Related Person” means each of the following: (a) Harley, (b) any Subsidiary of Harley or (c) any employee benefit plan of Harley or of any Subsidiary of Harley or any Person organized, appointed or established by Harley for or pursuant to the terms of any such plan.

“Release” means any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching or migration into the indoor or outdoor environment, including the movement of contaminants through or in the air, soil, surface water or groundwater.

“Required Lenders” means, in all cases subject to Section 8.2(v) hereof, Lenders whose Pro Rata Shares, in the aggregate, are greater than fifty percent (50%); provided, however, that, if any of the Lenders shall have failed to fund its Pro Rata Share of any Loan requested by the applicable Borrower which such Lenders are obligated to fund under the terms of this Agreement and any such failure has not been cured, then for so long as such failure continues, “Required Lenders” means Lenders (excluding all Lenders whose failure to fund their respective Pro Rata Shares of such Loans has not been so cured) whose Pro Rata Shares represent greater than fifty percent (50%) of the aggregate Pro Rata Shares of such Lenders; provided, further, however, that, if the Commitments have been terminated pursuant to the terms of this Agreement, “Required Lenders” means Lenders (without regard to such Lenders’ performance of their respective obligations hereunder) whose Pro Rata Shares, in the aggregate, are greater than fifty percent (50%).

“Required Syndicated Canadian Banks” means Syndicated Canadian Banks whose Syndicated Canadian Pro Rata Shares, in the aggregate, are greater than fifty percent (50%); provided, however, that, if any of the Lenders shall have failed to fund its Syndicated Canadian Pro Rata Share of any Syndicated Canadian Loan requested by the Canadian Borrower which such Syndicated Canadian Banks are obligated to fund under the terms of this Agreement and the Syndicated Canadian Addendum and any such failure has not been cured, then for so long as such failure continues, “Required Syndicated Canadian Banks” means Syndicated Canadian Banks (excluding all Syndicated Canadian Banks whose failure to fund their respective Syndicated Canadian Pro Rata Shares of such Syndicated Canadian Loans has not been so cured) whose Syndicated Canadian Pro Rata Shares represent greater than fifty percent (50%) of the aggregate Syndicated Canadian Pro Rata Shares of such Syndicated Canadian Banks; provided, further, however, that, if the Commitments have been terminated pursuant to the terms of this Agreement or the Syndicated Canadian Commitments have been terminated pursuant to the terms of this Agreement and the Syndicated Canadian Addendum, “Required Syndicated Canadian Banks” means Syndicated Canadian Banks (without regard to such Syndicated Canadian Banks’ performance of their respective obligations hereunder) whose Syndicated Canadian Pro Rata Shares, in the aggregate, are greater than fifty percent (50%).

“Reserve Requirement” means, with respect to an Interest Period, the maximum aggregate reserve requirement (including all basic, supplemental, marginal and other reserves) which is imposed under Regulation D on Eurocurrency liabilities.

“Reset Date” is defined in Section 1.2 hereof.

“S&P” is defined in Section 2.6(b) hereof.

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“S&P Rating” is defined in Section 2.6(b) hereof.

“Selling Lender” is defined in Section 2.4(b)(ii) hereof.

“Single Employer Plan” means a single employer plan, as defined in Section 4001(a)(15) of ERISA, that (a) is maintained for employees of Harley or any ERISA Affiliate and no Person other than Harley and the ERISA Affiliates or (b) was so maintained and in respect of which Harley or any ERISA Affiliate could have liability under Section 4069 of ERISA in the event such plan has been or were to be terminated.

“SPE” means a Subsidiary trust, limited purpose finance company, or special purpose entity formed for the purpose of consummation of one or more Permitted Finance Receivables Securitizations.

“Stamping Fee” is defined in the Syndicated Canadian Addendum.

“Subordinated Indebtedness” is defined in Section 6.3(A) hereof.

“Subordinated Intercompany Indebtedness” means Indebtedness arising from intercompany loans; provided if the obligor on such Indebtedness is one or more of the Companies (whether as a primary obligor or a secondary obligor), such Indebtedness shall be subordinated to the Obligations pursuant to the subordination terms attached as Schedule IV.

“Subsidiary” of a Person means (i) any corporation more than 50% of the outstanding securities having ordinary voting power of which shall at the time be owned or controlled, directly or indirectly, by such Person or by one or more of its Subsidiaries or by such Person and one or more of its Subsidiaries, or (ii) any company, partnership, association, trust, joint venture or similar business organization more than 50% of the ownership interests having ordinary voting power of which shall at the time be so owned or controlled. Unless otherwise expressly provided, all references herein to a “Subsidiary” shall mean a direct or indirect Subsidiary of Harley.

“Support Agreement” means the Support Agreement dated as of September 26, 1996 between Harley and HDFS evidencing Harley’s agreement to support certain debts of HDFS and its Subsidiaries, together with and as supplemented by the letter agreement dated as of April 28, 2011 and the letter agreement dated as of April 13, 2012, in each case to the Global Administrative Agent from Harley and HDFS pursuant to which certain modifications to the above-referenced Support Agreement were agreed to for the benefit of the Global Administrative Agent and the Lenders.

“Swing Line Commitment” means the Canadian Swing Line Commitment, U.K. Swing Line Commitment or USD Swing Line Commitment, as applicable.

“Swing Line Exposure” means, at any time, the aggregate principal amount of all Swing Line Loans outstanding at such time. The Swing Line Exposure of any Lender at any time shall be its Pro Rata Share of the total Swing Line Exposure at such time.

“Swing Line Loan” means a Canadian Swing Line Loan, U.K. Swing Line Loan or USD Swing Line Loan, as applicable, made available to the applicable Borrower by the Global Swing Line Lender pursuant to Section 2.9.

“Swiss Francs” means the lawful currency of Switzerland.

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“Syndicated Canadian Addendum” means an addendum substantially in the form of Exhibit E with such modifications thereto as shall be approved by the Global Administrative Agent.

“Syndicated Canadian Advance” means a borrowing consisting of simultaneous Syndicated Canadian Loans (of the same Type, currency and, if relevant, for the same Interest Period) made to the Canadian Borrower by the Syndicated Canadian Banks pursuant to Section 2.2.

“Syndicated Canadian Bank” means any Lender (or any Affiliate, branch or agency thereof) to the extent it is party to a Syndicated Canadian Addendum. If any agency, branch or Affiliate of any Lender shall be a party to the Syndicated Canadian Addendum, such agency, branch or Affiliate shall, to the extent of any commitment extended and any Loans made by it, have all the rights of such Lender hereunder; provided, however, that such Lender shall, to the exclusion of such agency, branch or Affiliate, continue to have all the voting rights vested in it by the terms hereof.

“Syndicated Canadian Borrowing” means any borrowing consisting of a Loan made to the Canadian Borrower.

“Syndicated Canadian Borrowing Notice” has the meaning specified in Section 2.6(a) hereof.

“Syndicated Canadian Commitment” means, for any Syndicated Canadian Bank, the obligation of such Syndicated Canadian Bank to make Syndicated Canadian Loans not exceeding the Dollar Amount set forth in Exhibit A to this Agreement, as such amount may be modified from time to time pursuant to the terms of this Agreement and/or the Syndicated Canadian Addendum.

“Syndicated Canadian Loan” means any loan or Bankers’ Acceptance Loan made by a Syndicated Canadian Bank to the Canadian Borrower pursuant to Section 2.2 and the Syndicated Canadian Addendum.

“Syndicated Canadian Note” means, to the extent requested, a promissory note of the Canadian Borrower payable to the order of any requesting Syndicated Canadian Bank, in substantially the form attached to the Syndicated Canadian Addendum, evidencing the aggregate indebtedness of the Canadian Borrower to such Syndicated Canadian Bank resulting from the Syndicated Canadian Loans made by such Syndicated Canadian Bank to the Canadian Borrower.

“Syndicated Canadian Pro Rata Share” means, with respect to any Syndicated Canadian Bank, the percentage obtained by dividing (A) such Syndicated Canadian Bank’s Syndicated Canadian Commitment at such time (in each case, as adjusted from time to time in accordance with the provisions of this Agreement and the Syndicated Canadian Commitment) by (B) the aggregate of the Syndicated Canadian Commitments at such time; provided, however, that, if the Syndicated Canadian Commitments have been terminated pursuant to the terms of this Agreement or the Syndicated Canadian Addendum, “Syndicated Canadian Pro Rata Share” means, with respect to any Syndicated Canadian Bank, the percentage obtained by dividing (A) the amount of such Syndicated Canadian Bank’s (i) Syndicated Canadian Loans plus (ii) share of the obligation to purchase participations in Canadian Swing Line Loans to the Canadian Borrower by (B) the aggregate outstanding principal amount of all Syndicated Canadian Loans and Canadian Swing Line Loans to the Canadian Borrower.

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“Syndicated Global Advance” means a borrowing consisting of simultaneous Syndicated Global Loans of the same Type made to a Global Borrower by each of the Syndicated Global Lenders pursuant to Section 2.1, and in the case of Eurocurrency Rate Advances, denominated in the same currency and for the same Interest Period.

“Syndicated Global Advance Borrowing Notice” is defined in Section 2.6(a) hereof.

“Syndicated Global Lender” means any Lender (or any Affiliate, branch or agency thereof) party hereto with a commitment to make Syndicated Global Loans to each Global Borrower.

“Syndicated Global Loan” means a loan by a Syndicated Global Lender to a Global Borrower as part of a Syndicated Global Advance.

“Syndicated Global Note” means, to the extent requested, a promissory note of a Global Borrower payable to the order of any requesting Syndicated Global Lender, in substantially the form of Exhibit B-1 hereto, evidencing the aggregate indebtedness of such Global Borrower to such Syndicated Global Lender resulting from the Syndicated Global Loans made by such Syndicated Global Lender to such Global Borrower.

“TARGET Settlement Day” means any day on which the Trans-European Automated Real-Time Gross Settlement Express Transfer (TARGET) System is open.

“Taxes” means any and all present or future taxes, duties, levies, imposts, deductions, assessments, fees, charges or withholdings, and any and all liabilities with respect to the foregoing, in each case (i) imposed on or with respect to any payment made by or on account of any obligation of the Borrowers under any Loan Document, but (ii) excluding Excluded Taxes.

“Tax Credit” means a credit against, relief or remission of, or repayment of any Taxes or Other Taxes.

“Termination Date” means the earlier of (a) April 13, 2017 and (b) the date of termination of the Commitments pursuant to Section 2.4 or Section 8.1.

“Transactions” means the execution, delivery and performance by the Companies of this Agreement and the other Loan Documents, the borrowing of Loans and the use of the proceeds thereof.

“Transferee” is defined in Section 13.5 hereof.

“Type” means, (a) with respect to any Syndicated Global Loan, its nature as a Base Rate Loan or Eurocurrency Rate Loan, (b) with respect to any Syndicated Global Advance, its nature as a Base Rate Advance or Eurocurrency Rate Advance, (c) with respect to any Swing Line Loan, its nature as a Eurocurrency Rate Loan, Canadian Prime Rate Loan or CDOR Loan, (d) with respect to any Syndicated Canadian Loan, its nature as a CDOR Loan, Eurocurrency Rate Loan, Base Rate Loan or Canadian Prime Rate Loan and (e) with respect to any Syndicated Canadian Advance, its nature as a CDOR Advance, Eurocurrency Rate Advance, Base Rate Advance or Canadian Prime Rate Advance.

“U.K. Swing Line Borrowing Notice” is defined in Section 2.9.3 hereof.

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“U.K. Swing Line Commitment” means the obligation of the Global Swing Line Lender to make U.K. Swing Line Loans to the Global Borrowers up to a maximum principal Dollar Amount of $35,000,000 in the aggregate and on a cumulative basis at any one time outstanding, as such amount may be adjusted from time to time in accordance with the provisions of Section 2.9.3.

“U.K. Swing Line Currency” means Dollars, euro, and so long as such currencies remain in effect, Pounds Sterling and Swiss Francs.

“U.K. Swing Line Loan” means a loan denominated in any U.K. Swing Line Currency made available to a Global Borrower by the Global Swing Line Lender pursuant to Section 2.9.3.

“Unmatured Default” means an event which, but for the lapse of time or the giving of notice, or both, would constitute a Default.

“U.S. Borrower” means Harley, HDFC or HDFS, and “U.S. Borrowers” means, collectively, Harley, HDFC and HDFS.

“USD Swing Line Borrowing Notice” is defined in Section 2.9.1 hereof.

“USD Swing Line Commitment” means the obligation of the Global Swing Line Lender to make USD Swing Line Loans up to a maximum principal amount of $35,000,000 in the aggregate at any one time outstanding.

“USD Swing Line Loan” means a Dollar denominated Loan made available to the U.S. Borrowers by the Global Swing Line Lender pursuant to Section 2.9.1.

“Voting Stock” means capital stock issued by a corporation, or equivalent interests in any other Person, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Person, even if the right so to vote has been suspended by the happening of such a contingency.

The foregoing definitions shall be equally applicable to both the singular and plural forms of the defined terms. Any accounting terms used in this Agreement which are not specifically defined herein shall be interpreted in accordance with Section 9.8 hereof. Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or other document in any Loan Document shall be construed as referring to such agreement, instrument or other document as amended, restated, supplemented or otherwise modified from time to time (subject to any restrictions on such amendments, restatements, supplements or modifications set forth herein or in any other Loan Document), (ii) any reference to any Person in any Loan Document shall be construed to include such Person’s successors and assigns (subject to any restrictions on assignments set forth herein or in any other Loan Document) and (iii) any reference in any Loan Document to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law, and any reference in any Loan Document to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time.

1.2 Currency Equivalents. Not later than 1:00 p.m., New York time or local time, as applicable, on each Calculation Date, the Global Administrative Agent shall (i) determine the Exchange Rate as of such Calculation Date with respect to each Agreed Currency and (ii) give notice thereof to Harley and the Syndicated Global Lenders. The Exchange Rates so determined shall become effective immediately with respect to any new Loans being made on any Calculation Date and any Loans being repaid on any

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Calculation Date and otherwise on the fifth Business Day immediately following the relevant Calculation Date (a “Reset Date”), shall remain effective until the next succeeding Reset Date and shall during the period of their effectiveness be employed in making any computation of currency equivalents required to be made under this Agreement (other than pursuant to Section 2.19).

ARTICLE II THE CREDITS

2.1 Syndicated Global Loans. Upon the satisfaction of the conditions precedent set forth in Sections 4.1 and 4.2 hereof, from and including the date of this Agreement and prior to the Termination Date, each Syndicated Global Lender severally and not jointly agrees, on the terms and conditions set forth in this Agreement, to make Syndicated Global Loans to the Global Borrowers from time to time, in the Applicable Agreed Currency, in a Dollar Amount not to exceed in the aggregate at any one time outstanding an amount equal to such Syndicated Global Lender’s Pro Rata Share of the Aggregate Commitment; provided, however

(i) that the sum of (a) the aggregate Dollar Amount of the Syndicated Global Loans then outstanding, (b) the aggregate Dollar Amount of the Bid Rate Loans then outstanding, (c) the aggregate amount of the USD Swing Line Loans then outstanding, (d) the aggregate Dollar Amount of the Canadian Swing Line Loans then outstanding, (e) the aggregate Dollar Amount of the U.K. Swing Line Loans then outstanding and (f) the aggregate Dollar Amount of Syndicated Canadian Loans then outstanding, shall not exceed the Aggregate Commitment, in each case other than as a result of currency fluctuations and then only to the extent permitted in Section 2.3(B);

(ii) that the aggregate outstanding Dollar Amount of Syndicated Global Loans in Canadian Dollars, Syndicated Canadian Loans in Canadian Dollars and Canadian Swing Line Loans at any time shall not exceed the Canadian Dollar Sublimit, in each case other than as a result of currency fluctuations and then only to the extent permitted in Section 2.3(B);

(iii) that the aggregate outstanding Dollar Amount of all Loans at any time shall not exceed the Aggregate Commitment, in each case other than as a result of currency fluctuations and then only to the extent permitted in Section 2.3(B); and

(iv) that, notwithstanding anything contained in this Agreement or the Syndicated Canadian Addendum, the aggregate Dollar Amount of all Syndicated Global Loans made by a Syndicated Global Lender, when aggregated with the Syndicated Canadian Loans made by its affiliated Syndicated Canadian Bank, shall not at any time exceed the amount of such Syndicated Global Lender’s Commitment, in each case other than as a result of currency fluctuations and then only to the extent permitted in Section 2.3(B).

Each Syndicated Global Advance under this Section 2.1 shall consist of Syndicated Global Loans made by each Syndicated Global Lender ratably in proportion to such Syndicated Global Lender’s respective Pro Rata Share; provided that, the Global Administrative Agent may allocate any Syndicated Global Advance on a non-pro rata basis to the extent the failure to so allocate would cause a Syndicated Global Lender’s Loans, when aggregated with its affiliated Syndicated Canadian Bank’s Loans, to exceed such Syndicated Global Lender’s Commitment. Subject to the terms of this Agreement, each Global Borrower may borrow, repay and reborrow Syndicated Global Loans at any time prior to the Termination Date. Each Global Borrower may select, in accordance with Sections 2.6 and 2.8 and subject to the other conditions and limitations therein set forth and set forth in this Article II, Global Rate Options and Interest Periods applicable to portions of the Syndicated Global Advances. On the Termination Date, the outstanding principal balance of the Syndicated Global Loans shall be paid in full by the Global Borrowers.

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2.2 Syndicated Canadian Advances.

(A) Making of Syndicated Canadian Loans. Upon the satisfaction of the conditions precedent set forth in Article IV hereof and set forth in the Syndicated Canadian Addendum, from and including the later of the date of this Agreement and the date of execution of the Syndicated Canadian Addendum and prior to the Termination Date (unless an earlier termination date shall be specified in or pursuant to the Syndicated Canadian Addendum), each Syndicated Global Lender shall cause its affiliated Syndicated Canadian Bank, on the terms and conditions set forth in this Agreement and in the Syndicated Canadian Addendum, to make its Syndicated Canadian Pro Rata Share of Syndicated Canadian Loans to the Canadian Borrower from time to time in Dollars (solely with respect to Base Rate Loans and Eurocurrency Rate Loans) and in Canadian Dollars (solely with respect to Canadian Prime Rate Loans, Eurocurrency Rate Loans and CDOR Loans), in an amount not to exceed each such Syndicated Canadian Bank’s Syndicated Canadian Commitment (provided that the Global Administrative Agent may allocate any Syndicated Canadian Advance on a non-pro rata basis to the extent the failure to so allocate would cause a Syndicated Canadian Bank’s Loans, when aggregated with its affiliated Syndicated Global Lender’s Loans, to exceed such Syndicated Canadian Bank’s Syndicated Canadian Commitment); provided, however, at no time shall (i) the Dollar Amount of the outstanding principal amount of Syndicated Canadian Loans exceed the Syndicated Canadian Commitments set forth in the Syndicated Canadian Addendum or the Dollar Amount of all Syndicated Canadian Loans denominated in Canadian Dollars, when aggregated with the Dollar Amount of all Canadian Swing Line Loans and Syndicated Global Loans denominated in Canadian Dollars, exceed the Canadian Dollar Sublimit, in each case other than as a result of currency fluctuations and then only to the extent permitted in Section 2.3(B) and (ii) the Dollar Amount of the outstanding principal amount of the Loans exceed the Aggregate Commitment other than as a result of currency fluctuations and then only to the extent permitted in Section 2.3(B). Subject to the terms of this Agreement and the Syndicated Canadian Addendum, the Canadian Borrower may borrow, repay and reborrow Syndicated Canadian Loans at any time prior to the Termination Date (unless an earlier termination date shall be specified in or pursuant to the Syndicated Canadian Addendum). On the Termination Date (unless an earlier termination date shall be specified in or pursuant to the Syndicated Canadian Addendum), the outstanding principal balance of the Syndicated Canadian Loans shall be paid in full by the Canadian Borrower and prior to the Termination Date (unless an earlier termination date shall be specified in or pursuant to the Syndicated Canadian Addendum), prepayments of the Syndicated Canadian Loans shall be made by the Canadian Borrower if and to the extent required in Section 2.3(B). By its execution and delivery hereof, each Syndicated Global Lender agrees that it shall cause its affiliated Syndicated Canadian Bank with a Syndicated Canadian Commitment to execute and deliver to (or as directed by) the Global Administrative Agent, on such Business Day as is reasonably requested by the Global Administrative Agent, an executed counterpart to such Syndicated Canadian Bank’s signature page to the Syndicated Canadian Addendum.

(B) Borrowing Notice. When the Canadian Borrower desires to borrow under this Section 2.2, the Canadian Borrower shall deliver to the Global Administrative Agent a Syndicated Canadian Advance Borrowing Notice, signed by it, as provided in Section 2.6(a)(ii) specifying that the Canadian Borrower is requesting a Syndicated Canadian Loan pursuant to this Section 2.2. Any Syndicated Canadian Advance Borrowing Notice given pursuant to Section 2.6(a)(ii) shall be irrevocable.

(C) Termination. Except as otherwise required by applicable law, in no event shall a Syndicated Canadian Bank have the right to accelerate the Syndicated Canadian Loans outstanding or to terminate its commitments (if any) under the Syndicated Canadian Addendum to make Syndicated Canadian Loans prior to the stated termination date in respect thereof, except that such Syndicated Canadian Bank shall have such rights upon an acceleration of the Loans and a termination of the Commitments pursuant to Article VII and Article VIII.

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(D) Statements. The Global Administrative Agent shall furnish to Harley not less frequently than monthly, and at any other time at the reasonable request of Harley, a statement setting forth the outstanding Syndicated Canadian Loans made and repaid during the period since the last such report under the Syndicated Canadian Addendum.

(E) Risk Participation. Immediately and automatically upon the occurrence of a Default under Section 7.1(e), all Syndicated Canadian Loans shall be converted to and redenominated in Dollars equal to the Dollar Amount of each such Syndicated Canadian Loan determined as of the date of such conversion and each Syndicated Global Lender shall be deemed to have automatically, irrevocably and unconditionally purchased and received (to the extent of its unused Commitment) from each other Lender an undivided interest and participation in and to each Loan in such amounts as are necessary such that, after giving effect thereto, each Syndicated Global Lender shall hold its Pro Rata Share of each Loan; provided, that to the extent such conversion shall occur other than at the end of an Interest Period, the Borrowers shall pay to the Global Administrative Agent for the ratable benefit of each applicable Lender, all losses and breakage costs related thereto in accordance with Section 3.4 and, upon the written request of the Global Administrative Agent, each of the Syndicated Global Lenders shall pay to the Global Administrative Agent for the ratable benefit of each applicable Lender not later than two (2) Business Days following a request for payment from such Lender, in Dollars, an amount equal to the undivided interest in and participation in the applicable Loan purchased by such Syndicated Global Lender pursuant to this Section 2.2(E). In the event that any Syndicated Global Lender fails to make payment to the Global Administrative Agent of any amount due under this Section 2.2(E), the Global Administrative Agent shall be entitled to receive, retain and apply against such obligation the principal and interest otherwise payable to such Syndicated Global Lender hereunder until the Global Administrative Agent receives from such Syndicated Global Lender an amount sufficient to discharge such Syndicated Global Lender’s payment obligation as prescribed in this Section 2.2(E) together with interest thereon at the Federal Funds Effective Rate for each day during the period commencing on the date of demand by the applicable Lender and ending on the date such obligation is fully satisfied. The Global Administrative Agent will promptly remit all payments received as provided above to each relevant Lender.

(F) Other Provisions Applicable to Syndicated Canadian Loans. The specification of payment of Syndicated Canadian Loans in Dollars or Canadian Dollars (as applicable) at a specific place pursuant to this Agreement and the Syndicated Canadian Addendum is of the essence. Dollars or Canadian Dollars (as applicable) shall be the currency of account and payment of such Loans under this Agreement and the Syndicated Canadian Addendum. Notwithstanding anything in this Agreement, the obligation of the Canadian Borrower in respect of such Loans shall not be discharged by an amount paid in any other currency or at another place, whether pursuant to a judgment or otherwise, to the extent the amount so paid, on prompt conversion into Dollars or Canadian Dollars (as applicable) and transfer to such Syndicated Canadian Bank under normal banking procedure, does not yield the amount of Dollars or Canadian Dollars (as applicable) due under this Agreement and the Syndicated Canadian Addendum. In the event that any payment, whether pursuant to a judgment or otherwise, upon conversion and transfer, does not result in payment of the amount of Dollars or Canadian Dollars (as applicable) due under this Agreement or the Syndicated Canadian Addendum, such Syndicated Canadian Bank shall have an independent cause of action against the applicable Borrower for the currency deficit.

2.3 Payments of Loans.

(A) Optional Payments. Subject to Section 3.4 and the requirements of Section 2.7, each relevant Global Borrower may (a) prepay Dollar denominated Floating Rate Loans following irrevocable notice

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given to the Global Administrative Agent by such Borrower, by not later than 12:00 noon (New York time) on the date of the proposed prepayment, such notice specifying the aggregate principal amount of and the proposed date of the prepayment, and if such notice is given such Borrower shall prepay the outstanding principal amounts of the specified Dollar denominated Floating Rate Loans comprising part of the same Syndicated Global Advance in whole or ratably in part and (b) prepay non-Dollar denominated Floating Rate Loans or any Fixed Rate Loans following notice given to the Global Administrative Agent by such Borrower by not later than 12:00 noon (New York time) on the date that is not less than one (1) Business Day preceding the date of the proposed prepayment, such notice specifying the Syndicated Global Advance to be prepaid and the proposed date of the prepayment, and, if such notice is given, such Borrower shall, prepay the outstanding principal amounts of the non-Dollar denominated Floating Rate Loans or the Fixed Rate Loans comprising an Advance in whole (and not in part), together with accrued interest to the date of such prepayment on the principal amount prepaid. With respect to Floating Rate Advances, each partial prepayment shall be in an aggregate principal Dollar Amount not less than $1,000,000 and integral multiples of $100,000. Subject to Section 3.4 and the requirements of Section 2.7, the Canadian Borrower may, upon prior written notice to the Global Administrative Agent as prescribed in the Syndicated Canadian Addendum and specifying that it is prepaying all or a portion of its Syndicated Canadian Advances, prepay its Syndicated Canadian Advances in whole at any time, or from time to time in part as specified in the Syndicated Canadian Addendum by paying the principal amount to be paid together with all accrued and unpaid interest thereon to and including the date of payment.

(B) Mandatory Prepayments.

(i) Mandatory Prepayments of Loans Generally. If at any time, other than as a result of fluctuations in currency exchange rates, (a) the Dollar Amount of all Loans exceeds the Aggregate Commitment, the applicable Borrowers (as determined by Harley) shall, within five (5) Business Days’ notice from the Global Administrative Agent, prepay the applicable Loans in an aggregate amount such that after giving effect thereto the Dollar Amount of all Loans is less than or equal to the Aggregate Commitment and (b) the Dollar Amount of Syndicated Canadian Loans exceeds the Syndicated Canadian Commitments, the Canadian Borrower shall, within five (5) Business Days’ notice from the Global Administrative Agent, prepay the Syndicated Canadian Loans in an aggregate amount such that after giving effect thereto the Dollar Amount of Syndicated Canadian Loans is less than or equal to the Syndicated Canadian Commitments.

(ii) Mandatory Prepayments of Canadian Dollar Denominated Loans. If at any time, other than as a result of fluctuations in currency exchange rates, the Dollar Amount of all Canadian Swing Line Loans denominated in Canadian Dollars, Syndicated Canadian Loans denominated in Canadian Dollars and Syndicated Global Loans denominated in Canadian Dollars exceeds the Canadian Dollar Sublimit, the applicable Borrowers (as determined by Harley) shall, within five (5) Business Days’ notice from the Global Administrative Agent, prepay such Canadian Swing Line Loans, Syndicated Canadian Loans or Syndicated Global Loans (subject to Section 3.4) in an aggregate amount such that after giving effect thereto the Dollar Amount of all remaining Canadian Swing Line Loans, Syndicated Canadian Loans and Syndicated Global Loans, in each case to the extent denominated in Canadian Dollars, is less than or equal to the Canadian Dollar Sublimit. Prepayments of CDOR Loans under clauses (i), (ii) or (iii) of this Section 2.3(B) shall be governed by the terms set forth in the Syndicated Canadian Addendum.

(iii) Mandatory Prepayments due to Currency Fluctuations. If, solely as a result of fluctuations in currency exchange rates, on any Reset Date, (a) the Dollar Amount of the sum of (i) the outstanding principal amount of the Syndicated Global Loans at such time, plus (ii) the outstanding principal amount of the Syndicated Canadian Loans at such time, plus (iii) the outstanding principal amount of the Swing Line Loans at such time, plus (iv) the aggregate Dollar

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Amount of the Bid Rate Loans then outstanding, exceeds 105% of the Aggregate Commitments, (b) the Dollar Amount of all Canadian Swing Line Loans, Syndicated Canadian Loans and Syndicated Global Loans, in each case to the extent denominated in Canadian Dollars, exceeds 105% of the Canadian Dollar Sublimit, (c) the amount of the outstanding Canadian Swing Line Loans at such time exceeds 105% of the Canadian Swing Line Commitment, (d) the Dollar Amount of the outstanding U.K. Swing Line Loans at such time exceeds 105% of the U.K. Swing Line Commitment or (e) the Dollar Amount of the Syndicated Canadian Loans exceeds 105% of the Syndicated Canadian Commitments, the applicable Borrower shall on such Reset Date prepay the applicable Loans (subject to Section 3.4 if applicable) in an aggregate amount such that after giving effect thereto: (v) the Dollar Amount of the sum of (i) the outstanding principal amount of the Syndicated Global Loans at such time, plus (ii) the outstanding principal amount of the Syndicated Canadian Loans at such time, plus (iii) the outstanding principal amount of the Swing Line Loans at such time, plus (iv) the aggregate amount of the Bid Rate Loans at such time, is less than or equal to the Aggregate Commitment, (w) the Dollar Amount of all Canadian Swing Line Loans, Syndicated Canadian Loans and Syndicated Global Loans, in each case to the extent denominated in Canadian Dollars, is less than or equal to the Canadian Dollar Sublimit, (x) the amount of the outstanding Canadian Swing Line Loans is less than or equal to the Canadian Swing Line Commitment, (y) the Dollar Amount of the outstanding U.K. Swing Line Loans is less than or equal to the U.K. Swing Line Commitment and (z) the Dollar Amount of the Syndicated Canadian Loans is less than or equal to the Syndicated Canadian Commitments.

2.4 Reduction/Increase of Commitments.

(a) Reduction of Commitments. Harley may permanently reduce the Aggregate Commitment in whole, or in part ratably among the Lenders, in an aggregate minimum amount of $10,000,000 and integral multiples of $5,000,000 in excess of that amount, upon at least five (5) Business Days’ prior written notice to the Global Administrative Agent, which notice shall specify the amount of any such reduction; provided, however, that the amount of the Aggregate Commitment may not be reduced below the sum of the aggregate principal Dollar Amount of the outstanding Advances (including Syndicated Canadian Advances) and the Swing Line Loans. In addition, the Canadian Borrower may, upon three (3) Business Days’ prior written notice to the Global Administrative Agent, terminate entirely at any time or reduce from time to time, by an aggregate amount of $5,000,000 or any larger multiple of $1,000,000 (or as otherwise set forth in the Syndicated Canadian Addendum), the unused portions of the Syndicated Canadian Commitments as specified by the Canadian Borrower in such notice to the Global Administrative Agent; provided, however, that at no time shall the Syndicated Canadian Commitments be reduced to a figure less than the total of the outstanding principal amount of all Syndicated Canadian Loans and Canadian Swing Line Loans owing by the Canadian Borrower. All accrued and unpaid commitment fees shall be payable on the effective date of any termination of the obligations of the Lenders to make Loans hereunder. The Global Administrative Agent shall promptly distribute to the relevant Lenders any notices received by it under this Section 2.4(a).

(b) Increase in Aggregate Commitment.

(i) At any time prior to the Termination Date, Harley may request that the Aggregate Commitment be increased; provided that, (A) the Aggregate Commitment shall at no time exceed $1,000,000,000 and (B) each such request shall be in a minimum amount of at least $10,000,000. Each request shall be made in a written notice given to the Global Administrative Agent and the Lenders by Harley not less than twenty (20) Business Days prior to the proposed effective date of such increase,

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which notice (a “Commitment Increase Notice”) shall specify the amount of the proposed increase in the Aggregate Commitment and the proposed effective date of such increase. In the event of such a Commitment Increase Notice, each of the Syndicated Global Lenders shall be given the opportunity to participate in the requested increase ratably in the proportions that their respective Commitments bear to the Aggregate Commitment under this Agreement. On or prior to the date that is fifteen (15) Business Days after receipt of the Commitment Increase Notice, each Syndicated Global Lender shall submit to the Global Administrative Agent a notice indicating the maximum amount by which it is willing to increase its Commitment in connection with such Commitment Increase Notice (any such notice to the Global Administrative Agent being herein a “Lender Increase Notice”). Any Syndicated Global Lender which does not submit a Lender Increase Notice to the Global Administrative Agent prior to the expiration of such fifteen (15) Business Day period shall be deemed to have denied any increase in its Commitment. In the event that the increases of Commitments set forth in the Lender Increase Notices exceed the amount requested by Harley in the Commitment Increase Notice, the Global Administrative Agent and the Arrangers shall have the right, with the consent of Harley, to allocate the amount of increases necessary to meet the Commitment Increase Notice. In the event that the Lender Increase Notices are less than the amount requested by the Commitment Increase Notice, not later than three (3) Business Days prior to the proposed effective date of the requested increase, Harley may notify the Global Administrative Agent of any financial institution that shall have agreed to become a “Lender” party hereto (a “Proposed New Lender”) in connection with the Commitment Increase Notice. Any Proposed New Lender shall be subject to the consent of the Global Administrative Agent (which consent shall not be unreasonably withheld). If Harley shall not have arranged any Proposed New Lender(s) to commit to the shortfall from the Lender Increase Notices, then Harley shall be deemed to have reduced the amount of the Commitment Increase Notice to the aggregate amount set forth in the Lender Increase Notices. Based upon the Lender Increase Notices, any allocations made in connection therewith and any notice regarding any Proposed New Lender, if applicable, the Global Administrative Agent shall notify Harley and the Syndicated Global Lenders on or before the Business Day immediately prior to the proposed effective date of the amount of each Syndicated Global Lender’s and Proposed New Lenders’ Commitment (the “Effective Commitment Amount”) and the amount of the Aggregate Commitment, which amounts shall be effective on the following Business Day. Any increase in the Aggregate Commitment shall be subject to the following conditions precedent: (I) as of the date of the Commitment Increase Notice and as of the proposed effective date of the increase in the Aggregate Commitment, no event shall have occurred and then be continuing which constitutes a Default or Unmatured Default, (II) Harley, the Global Administrative Agent and each Proposed New Lender or Syndicated Global Lender that shall have agreed to provide a “Commitment” in support of such increase in the Aggregate Commitment shall have executed and delivered a “Commitment and Acceptance” substantially in the form of Exhibit F hereto, (III) counsels for the Borrowers and for the Guarantors shall have provided to the Global Administrative Agent supplemental opinions in form and substance reasonably satisfactory to the Global Administrative Agent and (IV) the Borrowers, the Guarantors and the Proposed New Lender shall otherwise have executed and delivered such other instruments and documents as the Global Administrative Agent shall have reasonably requested in connection with such increase. If any fee shall be charged by the Lenders in connection with any such increase, such fee shall be in accordance with then prevailing market conditions, which market conditions shall have been reasonably documented by the Global Administrative Agent to Harley. No less than two (2) Business Days prior to the effective date of the increase of the Aggregate Commitment, the Global Administrative Agent shall notify Harley of the amount of the fee to be charged by the Lenders, and Harley may, at least one (1) Business Day prior to such effective date, cancel its request for the commitment increase. Upon satisfaction of the conditions precedent to any increase in the Aggregate Commitment, the Global Administrative Agent shall promptly advise Harley and each Syndicated Global Lender of the effective date of such increase. Upon the effective date of any increase in the Aggregate Commitment that is supported by a Proposed New Lender, such Proposed New Lender shall be a party to this Agreement as a Lender and shall have the rights and obligations of a Lender hereunder. Nothing contained herein shall constitute, or otherwise be deemed to be, a commitment on the part of any Lender to increase its Commitment hereunder at any time.

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(ii) For purposes of this clause (ii), (A) the term “Buying Lender(s)” shall mean (1) each Syndicated Global Lender the Effective Commitment Amount of which is greater than its Commitment prior to the effective date of any increase in the Aggregate Commitment and (2) each Proposed New Lender that is allocated an Effective Commitment Amount in connection with any Commitment Increase Notice and (B) the term “Selling Lender(s)” shall mean each Syndicated Global Lender whose Commitment is not being increased from that in effect prior to such increase in the Aggregate Commitment. Effective on the effective date of any increase in the Aggregate Commitment pursuant to clause (i) above, each Selling Lender hereby sells, grants, assigns and conveys to each Buying Lender, without recourse, warranty, or representation of any kind, except as specifically provided herein, an undivided percentage in such Selling Lender’s right, title and interest in and to the sum of (i) the aggregate principal amount of its Syndicated Global Loans outstanding at such time, plus (ii) an amount equal to its actual participation interest of its Pro Rata Share of the aggregate principal amount of Swing Line Loans and Syndicated Canadian Loans outstanding at such time (“Outstanding Credit Exposure”) in the respective Dollar Amounts and percentages necessary so that, from and after such sale, each such Selling Lender’s Outstanding Credit Exposure shall equal such Selling Lender’s Pro Rata Share (calculated based upon the Effective Commitment Amounts) of the Aggregate Outstanding Credit Exposure. Effective on the effective date of the increase in the Aggregate Commitment pursuant to clause (i) above, each Buying Lender hereby purchases and accepts such grant, assignment and conveyance from the Selling Lenders. Each Buying Lender hereby agrees that its respective purchase price for the portion of the Aggregate Outstanding Credit Exposure purchased hereby shall equal the respective Dollar Amount necessary so that, from and after such payments, each Buying Lender’s Outstanding Credit Exposure shall equal such Buying Lender’s Pro Rata Share (calculated based upon the Effective Commitment Amounts) of the aggregate of the Outstanding Credit Exposure of all the Syndicated Global Lenders (“Aggregate Outstanding Credit Exposure”). Such amount shall be payable on the effective date of the increase in the Aggregate Commitment by wire transfer of immediately available funds to the Global Administrative Agent. The Global Administrative Agent, in turn, shall wire transfer any such funds received to the Selling Lenders, in same day funds, for the sole account of the Selling Lenders. Each Selling Lender hereby represents and warrants to each Buying Lender that such Selling Lender owns the Outstanding Credit Exposure being sold and assigned hereby for its own account and has not sold, transferred or encumbered any or all of its interest in such Outstanding Credit Exposure, except for participations which will be reduced or extinguished (as applicable) upon payment to Selling Lender of an amount equal to the portion of the Aggregate Outstanding Credit Exposure being sold by such Selling Lender. Each Buying Lender hereby acknowledges and agrees that, except for each Selling Lender’s representations and warranties contained in the foregoing sentence, each such Buying Lender is buying such interest without recourse to the Selling Lender and has entered into its Commitment and Acceptance with respect to such increase on the basis of its own independent investigation and has not relied upon, and will not rely upon, any explicit or implicit written or oral representation, warranty or other statement of the Lenders or the Global Administrative Agent concerning the authorization, execution, legality, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or the other Loan Documents. Harley hereby agrees to compensate each Selling Lender for all losses, expenses and liabilities incurred by such Selling Lender in connection with the sale and assignment of any Eurocurrency Rate Loan hereunder on the terms and in the manner as set forth in Section 3.4.

2.5 Method of Borrowing Advances.

(a) Syndicated Global Advances. The Global Administrative Agent shall, promptly upon receipt of a Syndicated Global Advance Borrowing Notice, notify each

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Syndicated Global Lender of such Syndicated Global Advance Borrowing Notice and, not later than such time as is reasonably requested by the Global Administrative Agent on each Borrowing Date, each Syndicated Global Lender shall make available its Syndicated Global Loan or Loans, in funds immediately available to the Global Administrative Agent at its address specified pursuant hereto, unless the Global Administrative Agent has notified the Syndicated Global Lenders that such Loan is to be made available to a Global Borrower at the Global Administrative Agent’s Eurocurrency Payment Office, in which case each Syndicated Global Lender shall make available its Syndicated Global Loan or Loans, in funds immediately available to the Global Administrative Agent at its Eurocurrency Payment Office, not later than 4:00 p.m. (local time in the city of the Global Administrative Agent’s Eurocurrency Payment Office) in the Agreed Currency designated by the Global Administrative Agent. The Global Administrative Agent will promptly make the funds so received from the Syndicated Global Lenders available to the relevant Global Borrower.

(b) Syndicated Canadian Advances. Subject to any alternate procedures set forth in the Syndicated Canadian Addendum, the Global Administrative Agent shall, promptly upon receipt of a Syndicated Canadian Borrowing Notice, notify each relevant Syndicated Canadian Bank of such Syndicated Canadian Borrowing Notice and, not later than such local time as is reasonably requested by the Global Administrative Agent on each Borrowing Date, each such Syndicated Canadian Bank shall make available its Syndicated Canadian Loan(s), in funds immediately available in Canadian Dollars, to the Global Administrative Agent at its address specified pursuant to Article XIV hereof. The Global Administrative Agent will promptly make the funds so received from the Syndicated Canadian Banks available to the Canadian Borrower.

2.6 Method of Selecting Types and Interest Periods; Determination of Applicable Margins.

(a) Method of Selecting Types and Interest Periods for Advances. Each Borrower shall select the Type of Syndicated Global Advance or Syndicated Canadian Advance and, in the case of each Eurocurrency Rate Advance or CDOR Advance, the Interest Period and permitted currency applicable to each Syndicated Global Advance, Syndicated Canadian Advance and CDOR Advance from time to time.

(i) Syndicated Global Advances. Each Global Borrower shall give the applicable office of the Global Administrative Agent or its applicable Affiliate (in each case as previously directed by the Global Administrative Agent to such Global Borrower) irrevocable notice (a “Syndicated Global Advance Borrowing Notice”), at its applicable office as previously specified to such Borrower, not later than the applicable time described in Schedule I, specifying: (i) the Borrowing Date of such Advance (which shall be a Business Day); (ii) the aggregate amount of such Advance; (iii) the Type of Advance selected and (iv) in the case of each Eurocurrency Rate Advance, the Interest Period and Agreed Currency applicable thereto. Each Syndicated Global Advance in an Agreed Currency other than Dollars must be a Eurocurrency Rate Advance; provided that each Syndicated Global Advance in euro must be a Eurocurrency Rate Advance based on EURIBOR. Each Syndicated Global Advance in Canadian Dollars shall only be a Eurocurrency Rate Advance. There shall be no more than ten (10) Interest Periods in effect with respect to all of the Syndicated Global Advances to any one Global Borrower at any time. Each Floating Rate Advance shall bear interest from and including the date of the making of such Advance to (but not including) the date of repayment thereof at the applicable Floating Rate, changing when and as such Floating Rate changes, plus the Floating Rate Margin. Changes in the rate of interest on that portion of any Syndicated Global Advance maintained as a Floating Rate Loan will take effect simultaneously with each change in the Alternate Base Rate or Canadian Prime Rate, as applicable. Each Eurocurrency Rate Advance shall bear interest from and including the first day of the Interest Period applicable thereto to (but not including) the last day of such Interest Period at the interest rate determined as applicable to such Eurocurrency Rate Advance.

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(ii) Syndicated Canadian Advances. The Canadian Borrower shall give the Global Administrative Agent irrevocable notice (a “Syndicated Canadian Advance Borrowing Notice”) not later than the applicable time described in Schedule I, specifying: (i) the Borrowing Date of such Advance (which shall be a Business Day); (ii) the aggregate amount of such Advance; (iii) the Type of Advance selected; (iv) in the case of each CDOR Advance and Eurocurrency Rate Advance, the Interest Period applicable thereto and (v) the permitted currency applicable thereto. Each Syndicated Canadian Advance shall be a CDOR Advance denominated in Canadian Dollars, Eurocurrency Rate Advance denominated in Dollars or Canadian Dollars, Base Rate Advance denominated in Dollars or a Canadian Prime Rate Advance denominated in Canadian Dollars. There shall be no more than ten (10) Interest Periods in effect with respect to all of the Syndicated Canadian Advances at any time. Each Canadian Prime Rate Advance shall bear interest from and including the date of the making of such Advance to (but not including) the date of repayment thereof at the applicable Canadian Prime Rate, changing when and as such Canadian Prime Rate changes. Each Syndicated Canadian Advance which is a Base Rate Advance shall bear interest from and including the date of the making of such Advance to (but not including) the date of repayment thereof at the applicable Alternate Base Rate, changing when and as such Alternate Base Rate changes, plus the Floating Rate Margin. Each Syndicated Canadian Advance which is a CDOR Advance shall be discounted over the relevant Interest Period at CDOR. Each Syndicated Canadian Advance which is a Eurocurrency Rate Advance shall bear interest from and including the first day of the Interest Period applicable thereto to (but not including) the last day of such Interest Period at the interest rate determined as applicable to such Eurocurrency Rate Advance.

(b) Determination of Applicable Margin and Applicable Commitment Fee Rate.

(i) Definitions. As used in this Section 2.6(b) and in this Agreement, the following terms shall have the following meanings:

“Applicable Commitment Fee Rate” means the percentage identified as the Applicable Commitment Fee Rate in, and determined by reference to Harley’s Status as established by reference to, the table set forth in this clause (i) below.

“Applicable Finco” means, at any date of determination, the Finco(s) that have, with respect to any rating agency identified in this Section, the highest of the rating(s) issued by such rating agency then in effect (if any) with respect to the senior unsecured long-term debt securities without third-party credit enhancement of any of the Fincos. For the avoidance of doubt, references in this Section to the Applicable Finco’s ratings shall refer to such highest ratings.

“Applicable Margin” means a percentage determined in accordance with the provisions of this Section 2.6(b) by reference to Harley’s or the Applicable Finco’s, as applicable, Status as established by reference to the following table:

Applicable Margin and Applicable Commitment Fee Rate	Level I			Level II			Level III			Level IV			Level V
Applicable Margin		0.875	%		1.00	%		1.125	%		1.25	%		1.50	%
Applicable Commitment Fee Rate		0.08	%		0.10	%		0.15	%		0.175	%		0.225	%

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“Fitch Rating” means, at any time, the rating issued by Fitch Ratings and then in effect with respect to (i) in the case of Loans to Harley, Harley’s issuer default rating and (ii) in the case of Loans to any other Borrower, the Applicable Finco’s senior unsecured long-term debt securities without third-party credit enhancement.

“Level I Status” exists at any date if, on such date, at least two of the following ratings exist: the Moody’s Rating is A2 or better, the S&P Rating is A or better or the Fitch Rating is A or better.

“Level II Status” exists at any date if, on such date, (i) the applicable Borrower has not qualified for Level I Status and (ii) at least two of the following ratings exist: the Moody’s Rating is A3 or better, the S&P Rating is A- or better or the Fitch Rating is A- or better.

“Level III Status” exists at any date if, on such date, (i) the applicable Borrower has not qualified for Level I Status or Level II Status and (ii) at least two of the following ratings exist: the Moody’s Rating is Baa1 or better, the S&P Rating is BBB+ or better or the Fitch Rating is BBB+ or better.

“Level IV Status” exists at any date if, on such date, (i) the applicable Borrower has not qualified for Level I Status, Level II Status or Level III Status and (ii) at least two of the following ratings exist: the Moody’s Rating is Baa2 or better, the S&P Rating is BBB or better or the Fitch Rating is BBB or better.

“Level V Status” exists at any date if, on such date, the applicable Borrower has not qualified for Level I Status, Level II Status, Level III Status or Level IV Status.

“Moody’s Rating” means, at any time, the rating issued by Moody’s Investors Service, Inc. and then in effect with respect to (i) in the case of Loans to Harley, Harley’s issuer rating and (ii) in the case of Loans to any other Borrower, the Applicable Finco’s senior unsecured long-term debt securities without third-party credit enhancement.

“Relevant Loans” means (1) Eurocurrency Rate Loans, (2) Eurocurrency Rate Advances, (3) CDOR Loans, (4) CDOR Advances, (5) Swing Line Loans which are Fixed Rate Loans and (6) USD Swing Line Loans described in Section 2.9.1(b)(y).

“S&P Rating” means, at any time, the rating issued by Standard and Poor’s Rating Services, a division of The McGraw Hill Companies, Inc., and then in effect with respect to (i) in the case of Loans to Harley, Harley’s implied corporate credit rating and (ii) in the case of Loans to any other Borrower, the Applicable Finco’s senior unsecured long-term debt securities without third-party credit enhancement.

“Status” means Level I Status, Level II Status, Level III Status, Level IV Status or Level V Status.

(ii) Determination of Applicable Margin and Applicable Commitment Fee Rate. The Applicable Commitment Fee Rate payable under Section 2.14(C) shall be determined by reference to the table set forth in clause (i) above on the basis of the Status as determined from

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Harley’s then-current Moody’s Rating, S&P Rating and Fitch Rating. The Applicable Margin in respect of any Loan shall be determined by reference to the table set forth in clause (i) above on the basis of the Status as determined from Harley’s or the Applicable Finco’s, as applicable, then-current Moody’s Rating, S&P Rating and Fitch Rating. The rating in effect on any date for the purposes of this Section is that in effect at the close of business on such date (it being understood and agreed that any change in such rating shall be effective as of the date on which such change is first announced publicly by the rating agency making such change). Except under the circumstances described in clause (iii) below, if at any time Harley has no Moody’s Rating, no S&P Rating and no Fitch Rating, Level V Status shall exist with respect to Loans to Harley and with respect to the Applicable Commitment Fee Rate. Except under the circumstances described in clause (iii) below, if at any time each Finco has no Moody’s Rating, no S&P Rating and no Fitch Rating, Level V Status shall exist with respect to Loans to any Borrower other than Harley. If any rating agency shall change the basis on which ratings are established, each reference to Moody’s Rating, S&P Rating or Fitch Rating shall refer to the then equivalent rating by the applicable rating agency. Notwithstanding the foregoing, (a) if Harley or the Applicable Finco, as applicable, is split-rated by all three rating agencies (i.e., the ratings issued by the rating agencies are at three different levels), then the intermediate level will apply, and (b) in the event that Harley or the Applicable Finco, as applicable, shall maintain ratings from only two rating agencies and they are split-rated and (x) the ratings differential is one level, then the higher level will apply and (y) the ratings differential is two levels or more, then the level next below that of the higher of the levels will apply.

(iii) Changes re. Rating Agencies. If any of Moody’s, S&P or Fitch shall cease to be in the business of rating corporate debt obligations, the Companies and the Required Lenders shall negotiate in good faith to amend this Agreement to reflect the unavailability of ratings from such rating agency and, pending the effectiveness of any such amendment, the applicable ratings (in respect of determination of “Status”) from such rating agency shall be determined by reference to the rating(s) most recently in effect from such rating agency prior to such cessation.

2.7 Minimum Amount of Each Syndicated Global Advance and Syndicated Canadian Advance. Each Syndicated Global Advance and Syndicated Canadian Advance shall be in the applicable minimum amounts specified in Schedule I or, in the case of a Syndicated Canadian Advance, such other amounts as may be specified in the Syndicated Canadian Addendum; provided, however, that any Base Rate Advance may be in the amount of the unused Aggregate Commitment and any Canadian Prime Rate Advance or Base Rate Advance to the Canadian Borrower may be in the amount of the unused Syndicated Canadian Commitments.

2.8 Method of Selecting Types and Interest Periods for Conversion and Continuation of Syndicated Global Advances, Syndicated Canadian Advances and Swing Line Loans.

(A) Right to Convert. The applicable Borrower may elect from time to time, subject to the provisions of Section 2.6, Section 2.7 and this Section 2.8, to convert all or any part of an Advance of any Type into any other Type or Types of Advance; provided that any conversion of any Fixed Rate Advance or Fixed Rate Loan shall be made on, and only on, the last day of the Interest Period applicable thereto.

(B) Automatic Conversion and Continuation. Floating Rate Loans shall continue as Floating Rate Loans of the same Type unless and until such Floating Rate Loans are converted into Fixed Rate Loans. Fixed Rate Loans shall continue as Fixed Rate Loans until the end of the then applicable Interest Period therefor, at which time such Fixed Rate Loans (other than Fixed Rate Loans in Agreed Currencies other than Dollars) shall be automatically converted into Base Rate Loans unless the applicable Borrower shall have given the Global Administrative Agent notice in accordance with Section 2.8(D) requesting

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that, at the end of such Interest Period, such Fixed Rate Loans continue as Fixed Rate Loans. Fixed Rate Loans, including, without limitation, Swing Line Loans, in a currency other than Dollars and Syndicated Canadian Loans (other than CDOR Loans which shall be converted to Canadian Prime Rate Loans in accordance with the Syndicated Canadian Addendum) shall, upon the expiry of the then current Interest Period, automatically continue as Fixed Rate Loans in the same currency and of the same Type unless the applicable Borrower notifies the Global Administrative Agent otherwise as provided herein.

(C) No Conversion Post-Default. Notwithstanding anything to the contrary contained in Section 2.8(A) or Section 2.8(B), no Syndicated Global Loan, Swing Line Loan or Syndicated Canadian Loan may be converted into or continued as a Fixed Rate Loan except with the consent of the Required Lenders when any Default has occurred and is continuing; provided that, absent such consent, any such Syndicated Global Loan, Swing Line Loan or Syndicated Canadian Loan which is a Eurocurrency Rate Loan in a currency other than Dollars or Canadian Dollars shall, upon the expiration of the relevant Interest Period then applicable thereto, bear interest for each subsequent day at a per annum rate equal to the rate applicable to Eurocurrency Rate Loans to the relevant Borrower for such currency for an Interest Period of one month.

(D) Conversion/Continuation Notice. The applicable Borrower shall give the Global Administrative Agent irrevocable notice (a “Conversion/Continuation Notice”) of each conversion of a Floating Rate Loan into a Fixed Rate Loan or continuation of a Fixed Rate Loan not later than the time prior to the date of the requested conversion or continuation which is consistent with the requisite time and notice required in connection with Section 2.6(a), specifying: (1) the requested date (which shall be a Business Day) of such conversion or continuation; (2) the amount and Type of the Syndicated Global Loan, Swing Line Loan or Syndicated Canadian Loan to be converted or continued; and (3) the amounts of Fixed Rate Loan(s) into which such Syndicated Global Loan, Swing Line Loan or Syndicated Canadian Loan is to be converted or continued, the applicable permitted currency and the duration of the Interest Periods applicable thereto. If no such notice is given with respect to a Fixed Rate Loan (other than CDOR Loans) in a currency other than Dollars, the Interest Period applicable to the automatic continuation of such Loan shall be one month.

(E) Limitations on Conversions. Notwithstanding anything herein to the contrary, at the election of the applicable Borrowers under this Section 2.8, (x) Eurocurrency Rate Advances in an Agreed Currency may be converted and/or continued as Eurocurrency Rate Advances only in the same Agreed Currency, (y) U.K. Swing Line Loans in a U.K. Swing Line Currency may be converted and/or continued as U.K. Swing Line Loans only in the same U.K. Swing Line Currency and (z) Syndicated Canadian Loans in a particular permitted currency may be converted and/or continued as Syndicated Canadian Loans only in the same currency.

2.9 Swing Line Loans.

2.9.1 USD Swing Line Loans. (a) Amount of USD Swing Line Loans. Upon the satisfaction of the conditions precedent set forth in Sections 4.1 and 4.2, from and including the date of this Agreement and prior to the Termination Date, the Global Swing Line Lender agrees, on the terms and conditions set forth in this Agreement, to make USD Swing Line Loans in Dollars to the U.S. Borrowers or the Canadian Borrower from time to time in an amount not to exceed in the aggregate at any one time outstanding the lesser of (i) $35,000,000 or (ii) the amount by which the Aggregate Commitment exceeds the sum of the outstanding principal Dollar Amount of Syndicated Global Advances, Bid Rate Advances, Swing Line Loans and Syndicated Canadian Advances at such time. Each USD Swing Line Loan shall be in the applicable minimum amounts specified in Schedule II (or such lesser amount as may be agreed to by the Global Swing Line Lender) or an integral multiple thereof as specified in Schedule II (or such lesser amount as may be agreed to by the Global Swing Line Lender) in excess thereof, and all interest payable on the USD Swing Line Loans shall be payable to the Global Swing Line Lender for the account of the Global Swing Line Lender.

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(b) Borrowing Notice; Interest on USD Swing Line Loans. The applicable U.S. Borrower shall deliver to the Global Administrative Agent and the Global Swing Line Lender a notice (a “USD Swing Line Borrowing Notice”) signed by it not later than the applicable time and to the applicable location described in Schedule II on the Borrowing Date of each USD Swing Line Loan specifying (i) the applicable Borrowing Date (which shall be a Business Day) and (ii) the aggregate amount of the requested USD Swing Line Loan. All USD Swing Line Loans shall bear interest at the election of such U.S. Borrower at a per annum rate equal to (x) the Prime Rate or (y) the sum of (a) a money market rate or fixed rate of interest for an interest period as agreed to by the Global Swing Line Lender and such U.S. Borrower (which interest period shall not in any event exceed thirty (30) days) plus (b) the Floating Rate Margin then in effect.

(c) Making of USD Swing Line Loans. Promptly after receipt of the Borrowing Notice under Section 2.9.1(b), the Global Administrative Agent shall notify the Global Swing Line Lender of the requested USD Swing Line Loan. Not later than 3:00 p.m. (New York time) on the applicable Borrowing Date, the Global Swing Line Lender shall make available its USD Swing Line Loan in funds immediately available as directed by the applicable U.S. Borrower.

(d) Repayment of USD Swing Line Loans. Each USD Swing Line Loan shall be paid in full by the applicable U.S. Borrower on or before the thirtieth day after the Borrowing Date for such USD Swing Line Loan (or if earlier on the last day of the interest period applicable thereto). Outstanding USD Swing Line Loans may be repaid from the proceeds of Syndicated Global Advances or Bid Rate Advances. Any repayment or prepayment of a USD Swing Line Loan shall be accompanied by accrued interest thereon and, subject to Section 2.9.1(a), shall be in the minimum amount of $100,000 (or such lesser amount as may be agreed to by the Global Swing Line Lender) and in increments of $100,000 (or such lesser amount as may be agreed to by the Global Swing Line Lender) in excess thereof or the full amount of such USD Swing Line Loan. If the applicable U.S. Borrower at any time fails to repay a USD Swing Line Loan on the applicable date when due, such U.S. Borrower shall be deemed to have elected to borrow a Syndicated Global Advance which shall be a Base Rate Advance under Section 2.1 as of such date equal in amount to the unpaid amount of such USD Swing Line Loan (notwithstanding the minimum amount of Base Rate Advances as provided in Section 2.7). The proceeds of any such Advance shall be used to repay such USD Swing Line Loan. Unless the Global Administrative Agent upon the request of or with the consent of the Required Lenders shall have notified the Global Swing Line Lender prior to such Global Swing Line Lender making any USD Swing Line Loan, that the applicable conditions precedent set forth in Article IV have not then been satisfied, each Syndicated Global Lender’s obligation to make Syndicated Global Loans pursuant to Section 2.1 and this Section 2.9.1(d) to repay such USD Swing Line Loan shall be unconditional, continuing, irrevocable and absolute and shall not be affected by any circumstances, including the inability of the applicable U.S. Borrower to satisfy the conditions precedent set forth in Article IV or the occurrence or continuance of a Default. In the event that any Syndicated Global Lender fails to make payment to the Global Administrative Agent of any amount due under this Section 2.9.1(d), the Global Administrative Agent shall be entitled to receive, retain and apply against such obligation the principal and interest otherwise payable to such Syndicated Global Lender hereunder until the Global Administrative Agent receives such payment from such Syndicated Global Lender or such obligation is otherwise fully satisfied. In addition to the foregoing, if for any reason any Syndicated Global Lender fails to make payment to the Global Administrative Agent of any amount due under this Section 2.9.1(d),

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such Syndicated Global Lender shall be deemed, at the option of the Global Administrative Agent, to have unconditionally and irrevocably purchased from the Global Swing Line Lender, without recourse or warranty, an undivided interest in and participation in the applicable USD Swing Line Loan in the amount of the Syndicated Global Loan such Syndicated Global Lender was required to make pursuant to this Section 2.9.1(d), and such interest and participation may be recovered from such Syndicated Global Lender together with interest thereon at the Federal Funds Effective Rate for each day during the period commencing on the date of demand by the Global Administrative Agent and ending on the date such obligation is fully satisfied.

2.9.2 Canadian Swing Line Loans. (a) Amount of Canadian Swing Line Loans. Upon the satisfaction of the conditions precedent set forth in Sections 4.1 and 4.2, from and including the date of this Agreement and prior to the Termination Date, the Global Swing Line Lender agrees, on the terms and conditions set forth in this Agreement and pursuant to other arrangements agreed to in writing by Harley and the Global Swing Line Lender, to make Canadian Swing Line Loans in Canadian Dollars to the Canadian Borrower and the U.S. Borrowers, in each case from time to time in an amount not to exceed in the aggregate, and on a cumulative basis for the Canadian Borrower and the U.S. Borrowers, at any one time outstanding the lesser of (i) the Canadian Swing Line Commitment and (ii) the amount by which the Aggregate Commitment exceeds the sum of the outstanding principal Dollar Amount of Syndicated Global Advances, Bid Rate Advances, Swing Line Loans and Syndicated Canadian Advances at such time. Each Canadian Swing Line Loan shall be in the applicable minimum amounts specified in Schedule II (or such lesser amount as may be agreed to by the Global Swing Line Lender) or an integral multiple thereof as specified in Schedule II (or such lesser amount as may be agreed to by the Global Swing Line Lender) in excess thereof, and all interest payable on the Canadian Swing Line Loans shall be payable to the Global Swing Line Lender for the account of the Global Swing Line Lender. In no event shall the number of Interest Periods under Canadian Swing Line Loans outstanding at any time be greater than five (5).

(b) Borrowing Notice; Interest on Canadian Swing Line Loans. The relevant Borrower shall (unless such Borrower and the Global Swing Line Lender agree otherwise) deliver to the Global Administrative Agent and the Global Swing Line Lender a notice (a “Canadian Swing Line Borrowing Notice”) signed by it not later than the applicable time and to the applicable location described in Schedule II specifying (i) the applicable Borrowing Date (which shall be a Business Day), (ii) the aggregate amount of the requested Canadian Swing Line Loan, (iii) whether such Canadian Swing Line Loan is to be made to the Canadian Borrower or a U.S. Borrower and (iv) the Type of Loan requested. All Canadian Swing Line Loans made to the Canadian Borrower shall be Canadian Prime Rate Loans or CDOR Loans and all Canadian Swing Line Loans made to the U.S. Borrowers shall be Canadian Prime Rate Loans or Eurocurrency Rate Loans denominated in Canadian Dollars only. All Canadian Swing Line Loans (x) that are Canadian Prime Rate Loans shall bear interest at the Canadian Prime Rate plus the Floating Rate Margin and (y) that are CDOR Loans or Eurocurrency Rate Loans shall have an Interest Period not in excess of thirty (30) days.

(c) Making of Canadian Swing Line Loans. Unless otherwise agreed by the applicable Borrower and the Global Swing Line Lender, not later than 4:00 p.m. (Toronto time) on the applicable Borrowing Date, (i) if the requested Canadian Swing Line Loan is to be made to the Canadian Borrower, the Global Swing Line Lender shall make available its Canadian Swing Line Loan in funds immediately available at the applicable location described in Schedule II to the Canadian Borrower and (ii) if the requested Canadian Swing Line Loan is to be made to a U.S. Borrower, the Global Swing Line Lender shall make available its Canadian Swing Line Loan in funds immediately available at the applicable location described in Schedule II to such U.S. Borrower.

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(d) Repayment of Canadian Swing Line Loans. Each Canadian Swing Line Loan shall be paid in full by the applicable Borrower which has received such Canadian Swing Line Loan on or before the thirtieth day after the Borrowing Date for such Canadian Swing Line Loan (or if earlier on the last day of the interest period applicable thereto). Outstanding Canadian Swing Line Loans may be repaid from the proceeds of Syndicated Global Advances or, if such Canadian Swing Line Loans were made to the Canadian Borrower, Syndicated Canadian Advances. Any payment or repayment of a Canadian Swing Line Loan shall be accompanied by accrued interest thereon and, subject to Section 2.9.2(a), shall be in the minimum amount of Cdn. $500,000 (or such lesser amount as may be agreed to by the Global Swing Line Lender) and in increments of Cdn. $100,000 (or such lesser amount as may be agreed to by the Global Swing Line Lender) in excess thereof or the full amount of such Canadian Swing Line Loan. Any prepayment or repayment of a Canadian Swing Line Loan other than at the end of the applicable Interest Period, if any, shall be for the full amount thereof and shall be accompanied by all amounts payable pursuant to Section 3.4.

(e) Risk Participation by Syndicated Canadian Banks in Canadian Swing Line Loans. If the Canadian Borrower at any time fails to repay a Canadian Swing Line Loan made to such Borrower on the applicable date when due, such Borrower shall be deemed to have elected to borrow a Syndicated Canadian Advance which shall be a Canadian Prime Rate Advance under Section 2.2 as of such date equal in amount to the unpaid amount of such Canadian Swing Line Loan (notwithstanding the minimum amount of Canadian Prime Rate Advances as provided in Section 2.7). The proceeds of any such Advance shall be used to repay such Canadian Swing Line Loan. Other than with respect to Canadian Swing Line Loans, if any, made by virtue of the relevant Borrower’s overdraft facilities with the Global Swing Line Lender, unless the Global Administrative Agent upon the request of or with the consent of the Required Lenders shall have notified the Global Swing Line Lender prior to such Global Swing Line Lender making any Canadian Swing Line Loan, that the applicable conditions precedent set forth in Article IV have not then been satisfied, each Syndicated Canadian Bank’s obligation to make Syndicated Canadian Loans pursuant to Section 2.2 and this Section 2.9.2(e) to repay such Canadian Swing Line Loan shall be unconditional, continuing, irrevocable and absolute and shall not be affected by any circumstances, including the inability of the applicable Borrower to satisfy the conditions precedent set forth in Article IV or the occurrence or continuance of a Default. In the event that any Syndicated Canadian Bank fails to make payment to the Global Administrative Agent of any amount due under this Section 2.9.2(e), the Global Administrative Agent shall be entitled to receive, retain and apply against such obligation the principal and interest otherwise payable to such Syndicated Canadian Bank hereunder until the Global Administrative Agent receives such payment from such Syndicated Canadian Bank or such obligation is otherwise fully satisfied. In addition to the foregoing, if for any reason any Syndicated Canadian Bank fails to make payment to the Global Administrative Agent of any amount due under this Section 2.9.2(e), such Syndicated Canadian Bank shall be deemed, at the option of the Global Administrative Agent, to have unconditionally and irrevocably purchased from the Global Swing Line Lender, without recourse or warranty, an undivided interest in and participation in the applicable Canadian Swing Line Loan in the amount of the Syndicated Canadian Loan such Syndicated Canadian Bank was required to make pursuant to this Section 2.9.2(e), and such interest and participation may be recovered from such Syndicated Canadian Bank together with interest thereon at the Federal Funds Effective Rate for each day during the period commencing on the date of demand by the Global Administrative Agent and ending on the date such obligation is fully satisfied.

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(f) Risk Participation by Syndicated Global Lenders in Canadian Swing Line Loans. If the applicable U.S. Borrower at any time fails to repay a Canadian Swing Line Loan made to such Borrower on the applicable date when due, such Canadian Swing Line Loan shall be converted to and redenominated in Dollars equal to the unpaid Dollar Amount of such Canadian Swing Line Loan determined as of the date of such conversion and such Borrower shall be deemed to have elected to borrow a Syndicated Global Advance which shall be a Base Rate Advance under Section 2.1 as of such date in such Dollar Amount (notwithstanding the minimum amount of Base Rate Advances as provided in Section 2.7). The proceeds of any such Advance shall be used to repay such Canadian Swing Line Loan. Each Syndicated Global Lender’s obligation to make Syndicated Global Loans pursuant to Section 2.1 and this Section 2.9.2(f) to repay such Canadian Swing Line Loan shall be unconditional, continuing, irrevocable and absolute and shall not be affected by any circumstances, including the inability of the applicable Borrower to satisfy the conditions precedent set forth in Article IV or the occurrence or continuance of a Default. In the event that any Syndicated Global Lender fails to make payment to the Global Administrative Agent of any amount due under this Section 2.9.2(f), the Global Administrative Agent shall be entitled to receive, retain and apply against such obligation the principal and interest otherwise payable to such Syndicated Global Lender hereunder until the Global Administrative Agent receives such payment from such Syndicated Global Lender or such obligation is otherwise fully satisfied. In addition to the foregoing, if for any reason any Syndicated Global Lender fails to make payment to the Global Administrative Agent of any amount due under this Section 2.9.2(f), such Syndicated Global Lender shall be deemed, at the option of the Global Administrative Agent, to have unconditionally and irrevocably purchased from the Global Administrative Agent, without recourse or warranty, an undivided interest in and participation in the applicable Canadian Swing Line Loan in the amount of the Syndicated Global Loan such Syndicated Global Lender was required to make pursuant to this Section 2.9.2(f), and such interest and participation may be recovered from such Syndicated Global Lender together with interest thereon at (1) the Federal Funds Effective Rate in the case of Loans denominated in Dollars and (2) the Overnight Foreign Currency Rate for Canadian Dollars in the case of Loans denominated in Canadian Dollars, in each case for each day during the period commencing on the date of demand by the Global Administrative Agent and ending on the date such obligation is fully satisfied.

2.9.3 U.K. Swing Line Loans.

(a) Amount of U.K. Swing Line Loans. Upon the satisfaction of the conditions precedent set forth in Sections 4.1 and 4.2, from and including the date of this Agreement and prior to the date that is five (5) Business Days prior to the Termination Date, the Global Swing Line Lender agrees, on the terms and conditions set forth in this Agreement, to make U.K. Swing Line Loans in one or more U.K. Swing Line Currencies to the Global Borrowers from time to time in a Dollar Amount not to exceed in the aggregate at any one time outstanding the lesser of (i) the U.K. Swing Line Commitment at such time and (ii) the amount by which the Aggregate Commitment exceeds the sum of the outstanding principal Dollar Amount of Syndicated Global Advances, Bid Rate Advances, Swing Line Loans and Syndicated Canadian Advances at such time. Each U.K. Swing Line Loan shall be in the applicable minimum amounts specified in Schedule II (or such lesser amount as may be agreed to by the Global Swing Line Lender) or an integral multiple thereof as specified in Schedule II (or such lesser amount as may be agreed to by the Global Swing Line Lender) in excess thereof, and all interest payable on the U.K. Swing Line Loans shall be payable to the Global Swing Line Lender for the account of the Global Swing Line Lender. In no event shall the number of U.K. Swing Line Loans outstanding at any time be greater than five (5).

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(b) Borrowing Notice; Interest on U.K. Swing Line Loans. The relevant Global Borrower shall deliver to the Global Administrative Agent and the Global Swing Line Lender a notice (a “U.K. Swing Line Borrowing Notice”) signed by it not later than the applicable time and to the applicable location described in Schedule II specifying (i) the applicable Borrowing Date (which shall be a Business Day), (ii) the aggregate amount of the requested U.K. Swing Line Loan, (iii) the U.K. Swing Line Currency in which such Loan is requested and (iv) the initial Interest Period in connection therewith. All of the U.K. Swing Line Loans shall be Eurocurrency Rate Loans with an Interest Period not in excess of thirty (30) days.

(c) Making of U.K. Swing Line Loans. Not later than 3:00 p.m. (London time) on the applicable Borrowing Date, the Global Swing Line Lender shall make available its U.K. Swing Line Loan in funds in the applicable U.K. Swing Line Currency immediately available at the applicable location described in Schedule II to the relevant Global Borrower.

(d) Repayment of U.K. Swing Line Loans. Each U.K. Swing Line Loan shall be paid in full by the relevant Global Borrower on or before the date that is the last day of the Interest Period applicable to such U.K. Swing Line Loan and shall be prepaid if required in connection with the provisions of Section 2.3(B)(iii). Outstanding U.K. Swing Line Loans may be repaid from the proceeds of Syndicated Global Advances. Any repayment or prepayment of a U.K. Swing Line Loan shall be accompanied by accrued interest thereon and, subject to Section 2.9.3(a), shall be in the minimum amount of $50,000 or the Equivalent Amount in the relevant U.K. Swing Line Currency (or such lesser amount as may be agreed to by the Global Swing Line Lender) and in increments of $50,000 or the Equivalent Amount in the relevant U.K. Swing Line Currency (or such lesser amount as may be agreed to by the Global Swing Line Lender) in excess thereof or the full amount of such U.K. Swing Line Loan. Any prepayment or repayment of a U.K. Swing Line Loan other than at the end of the applicable Interest Period shall be for the full amount thereof and shall be accompanied by all amounts payable pursuant to Section 3.4. If any Global Borrower at any time fails to repay a U.K. Swing Line Loan on the applicable date when due, such Borrower shall be deemed to have elected to borrow a Syndicated Global Advance which shall be a Eurocurrency Rate Advance in the applicable Agreed Currency under Section 2.1 as of such date equal in amount to the unpaid amount of such U.K. Swing Line Loan (notwithstanding the minimum amount of Eurocurrency Rate Advances). The proceeds of any such Advance shall be used to repay such U.K. Swing Line Loan. Unless the Global Administrative Agent upon the request of or with the consent of the Required Lenders shall have notified the Global Swing Line Lender prior to such Global Swing Line Lender making any U.K. Swing Line Loan that the applicable conditions precedent set forth in Article IV have not then been satisfied, each Syndicated Global Lender’s obligation to make Syndicated Global Loans pursuant to Section 2.1 and this Section 2.9.3(d) to repay such U.K. Swing Line Loan shall be unconditional, continuing, irrevocable and absolute and shall not be affected by any circumstances, including the inability of any Borrower to satisfy the conditions precedent set forth in Article IV or the occurrence or continuance of a Default. In the event that any Syndicated Global Lender fails to make payment to the Global Administrative Agent of any amount due under this Section 2.9.3(d), the Global Administrative Agent shall be entitled to receive, retain and apply against such obligation the principal and interest otherwise payable to such Syndicated Global Lender hereunder until the Global Administrative Agent receives such payment from such Syndicated Global Lender or such obligation is otherwise fully satisfied. In addition to the foregoing, if for any reason any Syndicated Global Lender fails to make payment to the Global Administrative Agent of any amount due under this Section 2.9.3(d), such Syndicated Global Lender shall be deemed, at the option of the Global Administrative Agent, to have unconditionally and irrevocably purchased from the Global Swing Line Lender, without recourse or warranty, an undivided interest in and participation in

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the applicable U.K. Swing Line Loan in the amount of the Syndicated Global Loan such Syndicated Global Lender was required to make pursuant to this Section 2.9.3(d), and such interest and participation may be recovered from such Syndicated Global Lender together with interest thereon at (1) the Federal Funds Effective Rate in the case of Loans denominated in Dollars and (2) the Overnight Foreign Currency Rate in the case of Loans denominated in any other U.K. Swing Line Currency, in each case for each day during the period commencing on the date of demand by the Global Administrative Agent and ending on the date such obligation is fully satisfied.

2.10 The Bid Rate Advances. (a) Each Syndicated Global Lender severally agrees that, on the terms and conditions set forth in this Agreement, any Global Borrower may request and receive Bid Rate Advances in Dollars, euro or any Eligible Currency under this Section 2.10 from time to time on any Business Day during the period from the date hereof until the date occurring 30 days prior to the Termination Date in the manner set forth below; provided, however, that, following the making of each Bid Rate Advance, the aggregate Dollar Amount of (i) the Advances, (ii) the Swing Line Loans and (iii) the Syndicated Canadian Loans then outstanding shall not exceed the Aggregate Commitment.

(b) The procedures for the solicitation and acceptance of Bid Rate Loans are set forth below:

(i) The applicable Global Borrower may request a Bid Rate Advance under this Section 2.10(b) by giving the Global Administrative Agent irrevocable notice at the office and location specified by the Global Administrative Agent, in a form reasonably acceptable to the Global Administrative Agent (a “Bid Rate Advance Borrowing Notice”), specifying the date, currency and aggregate amount of the proposed Bid Rate Advance, the maturity date for repayment of each Bid Rate Loan to be made as part of such Bid Rate Advance (which maturity date may not be earlier than, in the case of an Absolute Rate Auction, the date occurring thirty days, and in the case of an Indexed Rate Auction, the date occurring one month after the date of the related Bid Rate Advance or later than, in the case of an Absolute Rate Auction, the earlier of the day occurring 180 days after the date of such Bid Rate Advance and the Termination Date, and in the case of an Indexed Rate Auction, the earlier of the day occurring six months after the date of such Bid Rate Advance and the Termination Date), the interest payment date or dates relating thereto, and any other terms to be applicable to such Bid Rate Advance, not later than 10:00 a.m. (New York time) (A) one Business Day prior to the date of the proposed Bid Rate Advance, if the applicable Global Borrower shall specify in the Bid Rate Advance Borrowing Notice that the rates of interest to be offered by the Syndicated Global Lenders shall be absolute rates per annum (such type of solicitation being an “Absolute Rate Auction”) and (B) five (5) Business Days prior to the date of the proposed Bid Rate Advance, if the applicable Global Borrower shall specify in the Bid Rate Advance Borrowing Notice that the rates of interest to be offered by the Syndicated Global Lenders shall be based on the Eurocurrency Base Rate with respect to the applicable currency (such type of solicitation being an “Indexed Rate Auction”). The Global Administrative Agent shall, promptly following its receipt of a Bid Rate Advance Borrowing Notice under this Section 2.10(b), notify each Syndicated Global Lender of such request by sending such Syndicated Global Lender a copy of such Bid Rate Advance Borrowing Notice.

(ii) Each Syndicated Global Lender may, if, in its sole discretion, it elects to do so, irrevocably offer to make one or more Bid Rate Loans to the applicable Global Borrower as part of such proposed Bid Rate Advance at a rate or rates of interest specified by such Syndicated Global Lender in its sole discretion, by notifying the Global Administrative Agent (which shall give prompt notice thereof to the applicable Global Borrower), before 11:00 a.m. (New York time) (or if such Syndicated Global Lender is the Global Administrative Agent, before 10:45 a.m.

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(New York time)) (A) on the date of such proposed Bid Rate Advance, in the case of an Absolute Rate Auction, and (B) four Business Days before the date of such proposed Bid Rate Advance, in the case of an Indexed Rate Auction of the minimum amount and maximum amount of each Bid Rate Loan which such Syndicated Global Lender would be willing to make as part of such proposed Bid Rate Advance (which amounts may, subject to the proviso to the first sentence of Section 2.10(a), exceed such Syndicated Global Lender’s Commitment), the rate or rates of interest, in the case of an Absolute Rate Auction, or the spread or spreads with respect to the Eurocurrency Base Rate, in the case of an Indexed Rate Auction, therefor and such Syndicated Global Lender’s Lending Installation with respect to such Bid Rate Loan.

(iii) The applicable Global Borrower shall, in turn, before (A) 12:00 noon (New York time) on the date of such proposed Bid Rate Advance, in the case of an Absolute Rate Auction, and (B) 11:00 a.m. (New York time) three Business Days before the date of such proposed Bid Rate Advance, in the case of an Indexed Rate Auction for a Bid Rate Advance, either:

(x) cancel such Bid Rate Advance by giving the Global Administrative Agent notice to that effect; or

(y) accept, subject to Section 2.10(d), one or more of the offers made by any Syndicated Global Lender or Syndicated Global Lenders pursuant to Section 2.10(b)(ii), in its sole discretion, by giving notice to the Global Administrative Agent of the amount of each Bid Rate Loan (which amount shall be equal to or greater than the minimum amount, and equal to or less than the maximum amount, notified to the applicable Global Borrower by the Global Administrative Agent on behalf of such Syndicated Global Lender for such Bid Rate Loan pursuant to Section 2.10(b)(ii)) to be made by each Syndicated Global Lender as part of such Bid Rate Advance, and reject any remaining offers made by Syndicated Global Lenders pursuant to Section 2.10(b)(ii) by giving the Global Administrative Agent notice to that effect.

(iv) If the applicable Global Borrower notifies the Global Administrative Agent that such Bid Rate Advance is canceled pursuant to Section 2.10(b)(iii)(x), the Global Administrative Agent shall give prompt notice thereof to the Syndicated Global Lenders and such Bid Rate Advance shall not be made.

(v) If the applicable Global Borrower accepts one or more of the offers made by any Syndicated Global Lender or Syndicated Global Lenders pursuant to Section 2.10(b)(iii)(y), the Global Administrative Agent shall in turn promptly notify (A) each Syndicated Global Lender that has made an offer as described in Section 2.10(b)(ii) of the date, and aggregate amount of such Bid Rate Advance and whether or not any offer or offers made by such Syndicated Global Lender pursuant to Section 2.10(b)(ii) have been accepted by the applicable Global Borrower and (B) each Syndicated Global Lender that is to make a Bid Rate Loan as part of such Bid Rate Advance, of the amount of each Bid Rate Loan to be made by such Syndicated Global Lender as part of such Bid Rate Advance. Each Syndicated Global Lender that is to make a Bid Rate Loan as part of such Bid Rate Advance shall, not later than 3:00 p.m. (New York time) on the date of such Bid Rate Advance specified in the notice received from the Global Administrative Agent pursuant to clause (A) of the preceding sentence, make available for the account of its Lending Installation to the Global Administrative Agent at the relevant Eurocurrency Payment Office such Syndicated Global Lender’s portion of such Bid Rate Advance, in same day funds in the currency specified in the applicable Bid Rate Advance Borrowing Notice. Upon fulfillment of the applicable conditions set forth in Article IV and after receipt by the Global Administrative Agent

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of such funds, the Global Administrative Agent will make such funds available to the applicable Global Borrower at the Global Administrative Agent’s aforesaid address. Promptly after each Bid Rate Advance, the Global Administrative Agent will notify each Syndicated Global Lender of the amount of such Bid Rate Advance, the consequent Bid Rate Reduction and the dates upon which such Bid Rate Reduction commenced and will terminate.

(vi) Notwithstanding the other provisions of this Section 2.10(b), the applicable Global Borrower may elect at its own discretion to assume the responsibilities of the Global Administrative Agent in connection with the solicitation and acceptance of Bid Rate Loans as described in this section. In the event that the applicable Global Borrower makes the election described in this subsection, all notices to be given by such Borrower to the Global Administrative Agent pursuant to this Section 2.10(b) shall be given by such Borrower directly to the Global Administrative Agent and the Syndicated Global Lenders, all notices to be given by the Global Administrative Agent to the Syndicated Global Lenders pursuant to this Section 2.10(b) shall be given by such Borrower to the Syndicated Global Lenders, and all notices to be given by the Syndicated Global Lenders to the Global Administrative Agent pursuant to this Section 2.10(b) shall be given by the Syndicated Global Lenders to such Borrower and the Global Administrative Agent. In addition, any fee payable to the Global Administrative Agent in connection with the Bid Rate Loans in connection with such Bid Rate Loans solicited and accepted by any Global Borrower pursuant to this clause (vi) is hereby waived.

(c) Each Bid Rate Advance shall be in an aggregate amount not less than the Equivalent Amount of $10,000,000 in the applicable currency or an integral multiple of approximately $1,000,000 in the applicable currency in excess thereof, and, following the making of each Bid Rate Advance, the Borrowers shall be in compliance with the limitation set forth in the proviso to the first sentence of Section 2.10(a).

(d) Each acceptance by the applicable Global Borrower pursuant to Section 2.10(b)(iii)(y) of the offers made in response to a Bid Rate Advance Borrowing Notice shall be treated as an acceptance of such offers in ascending order of the rates or margins, as applicable, at which the same were made but if, as a result thereof, two or more offers at the same such rate or margin would be partially accepted, then the amounts of the Bid Rate Loans in respect of which such offers are accepted shall be treated as being the amounts which bear the same proportion to one another as the respective amounts of the Bid Rate Loans so offered bear to one another but, in each case, rounded as the Global Administrative Agent (or the applicable Global Borrower in the event such Borrower runs the bid rate process under clause (b)(vi) above) may consider necessary to ensure that the Equivalent Amount of each such Bid Rate Loan is approximately $500,000 or an integral multiple thereof.

(e) Within the limits and on the conditions set forth in this Section 2.10, each Global Borrower may from time to time borrow under this Section 2.10, repay pursuant to Section 2.10(f), and reborrow under this Section 2.10.

(f) The applicable Global Borrower shall repay to the Global Administrative Agent, for the account of each Syndicated Global Lender which has made a Bid Rate Loan to it, on the maturity date of such Bid Rate Loan (such maturity date being that specified by such Borrower for repayment of such Bid Rate Loan in the related Bid Rate Advance Borrowing Notice), or, if earlier, the acceleration of the Obligations pursuant to Section 8.1, the then unpaid principal amount of such Bid Rate Loan. No Borrower shall have the right to prepay any principal amount of any Bid Rate Loan without the consent of the applicable Syndicated Global Lender.

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(g) The applicable Global Borrower shall pay interest on the unpaid principal amount of each Bid Rate Loan made to it, from the date of such Bid Rate Loan to the date the principal amount of such Bid Rate Loan is repaid in full, at the rate of interest for such Bid Rate Loan specified by the Syndicated Global Lender making such Bid Rate Loan in the related notice submitted by such Syndicated Global Lender pursuant to Section 2.10(b)(ii), payable on the interest payment date or dates specified by such Borrower for such Bid Rate Loan in the related Bid Rate Advance Borrowing Notice and on any date on which such Bid Rate Loan is prepaid, whether by acceleration or otherwise. In the event the term of any Bid Rate Loan shall be longer than three months, interest thereon shall be payable not less frequently than once each three-month period during such term. Unless otherwise specified in the applicable Bid Rate Advance Borrowing Notice, interest on Bid Rate Advances shall be calculated (a) for actual days elapsed on the basis of a 365-day year or, when appropriate, 366-day year for Bid Rate Advances made pursuant to an Indexed Rate Auction and (b) for actual days elapsed on the basis of a 360-day year for Bid Rate Advances made pursuant to an Absolute Rate Auction.

(h) Except as provided in clause (b)(vi) above, in connection with each Bid Rate Loan, the applicable Global Borrower shall pay to the Global Administrative Agent the fee with respect thereto set forth in the relevant fee letter dated as of even date herewith between the Borrowers, J.P. Morgan Securities LLC and the Global Administrative Agent.

2.11 Default Rate. Notwithstanding anything contained herein to the contrary, if any principal of or interest on any Loan or any fee or other amount payable by any Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, the Global Administrative Agent may with the consent, and shall upon the request, of the Required Lenders require that such overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided herein or (ii) in the case of any other amount (other than as set forth in the following clause (iii)), 2% plus the rate applicable to Base Rate Advances as provided herein or (iii) in the case of any Syndicated Canadian Loan or Canadian Swing Line Loan, 2% plus the rate applicable to Canadian Prime Rate Loans.

2.12 Method of Payment. (i) All payments of principal, interest, and fees hereunder to the Global Administrative Agent shall be made, without setoff, deduction or counterclaim (a) at the Global Administrative Agent’s office at the applicable location at which such Advance was made in immediately available funds with respect to Advances denominated in Dollars and (b) in the Global Administrative Agent’s applicable Eurocurrency Payment Office in immediately available funds with respect to any Advance denominated in an Agreed Currency other than Dollars, in each case, or at any other Lending Installation of the Global Administrative Agent specified in writing (by 11:00 a.m. (New York time) on the day before the date when due) by the Global Administrative Agent to the applicable Borrower, by 12:00 noon local time in New York, New York with respect to Advances denominated in Dollars and 12:00 noon local time in the Global Administrative Agent’s Eurocurrency Payment Office with respect to Advances denominated in an Agreed Currency other than Dollars on the date when due and shall be made ratably among the relevant Lenders (unless such amount is not to be shared ratably in accordance with the terms hereof). Each Advance shall be repaid or prepaid in the currency in which it was made (the “Advanced Currency”) in the amount borrowed and interest payable thereon shall be paid in such Advanced Currency. Notwithstanding anything in this Agreement, the obligation of any Borrower in respect of any Advance shall not be discharged by an amount paid in any currency other than the Advanced Currency or at another location other than the location designated by the Global Administrative Agent, whether pursuant to a judgment or otherwise, to the extent the amount so paid, on prompt conversion into the Advanced Currency and transfer to the relevant Lenders under normal banking procedure, does not yield the amount of the Advanced Currency due under the Loan Documents. In the event that any payment, whether pursuant to a judgment or otherwise, upon conversion and transfer, does

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not result in payment of the amount of the Advanced Currency due under the Loan Documents, such Lender shall have an independent cause of action against the applicable Borrower(s) for the currency deficit. Each payment delivered to the Global Administrative Agent for the account of any Lender shall be delivered promptly by the Global Administrative Agent to such Lender in the same type of funds which the Global Administrative Agent received at its address specified pursuant to Article XIV or at any Lending Installation specified in a notice received by the Global Administrative Agent from such Lender.

(ii) All payments to be made by the applicable Borrowers hereunder in respect of any Swing Line Loans and Syndicated Canadian Loans shall be made in the currencies in which such Loans are denominated and in funds immediately available, at the Global Administrative Agent’s office or Global Swing Line Lender’s office (as applicable) office from which such Loan was made not later than 12:00 noon (local time) on the date on which such payment shall become due.

(iii) Notwithstanding the foregoing provisions of this Section, if, after the making of any Advance or Loan in any currency other than Dollars or euro, currency control or exchange regulations are imposed in the country which issues such currency with the result that different types of such currency (the “New Currency”) are introduced and the type of currency in which the Advance was made (the “Original Currency”) no longer exists or the applicable Borrower is not able to make payment to the Global Administrative Agent or the Global Swing Line Lender, as applicable, in such Original Currency, then all payments to be made by the applicable Borrower hereunder in such currency shall be made in such amount and such type of the New Currency or Dollars as shall be equivalent to the amount of such payment otherwise due hereunder in the Original Currency, it being the intention of the parties hereto that the Borrowers take all risks of the imposition of any such currency control or exchange regulations. In addition, notwithstanding the foregoing provisions of this Section, if, after the making of any Advance or Loan in any currency other than Dollars or euro, any applicable Borrower is not able to make payment to the Global Administrative Agent or the Global Swing Line Lender, as applicable, in the type of currency in which such Advance or Loan was made because of the imposition of any such currency control or exchange regulation, then such Advance or Loan shall instead be repaid when due in Dollars in a principal amount equal to the Dollar Amount (as of the date of repayment) of such Advance.

2.13 Notes, Telephonic Notices. Any Lender may request that the Loans made by it each be evidenced by the applicable Notes to evidence such Lender’s Loans. In such event, each applicable Borrower shall prepare, execute and deliver to such Lender such Note(s) for such Loans payable to the order of such Lender. Thereafter, such Loans evidenced by such Note(s) and interest thereon shall at all times be represented by one or more Notes, except to the extent that any such Lender subsequently returns any such Note for cancellation. Each Borrower authorizes the applicable Lenders and the Global Administrative Agent to extend Advances, effect selections of Types of Advances and to transfer funds in respect of Advances in Dollars based on telephonic notices made by any person or persons that the Global Administrative Agent or Lender in good faith believes to be acting on behalf of such Borrower; provided that all communications hereunder regarding the extension of Advances, the selection of Types of Advances and the transfer of funds, in each case in respect of Advances in any Agreed Currency other than Dollars, shall be solely in writing. Each Borrower agrees to deliver promptly to the Global Administrative Agent a written confirmation, signed by an Authorized Officer, if such confirmation is requested by the Global Administrative Agent or any Lender, of each telephonic notice. If the written confirmation differs in any material respect from the action taken by the Global Administrative Agent and Lenders, (i) the telephonic notice shall govern absent manifest error and (ii) the Global Administrative Agent or Lender, as applicable, shall promptly notify the Authorizing Officer who provided such confirmation of such difference.

2.14 Promise to Pay; Interest and Fees; Interest Payment Dates; Interest and Fee Basis; Loan Accounts.

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(A) Promise to Pay. Each Borrower unconditionally promises to pay when due the principal amount of each Loan made to it and all other Obligations incurred by it, and to pay all unpaid interest accrued thereon, in accordance with the terms of this Agreement.

(B) Interest Payment Dates. Interest accrued on each Floating Rate Loan, each Canadian Prime Rate Loan and USD Swing Line Loan shall be payable on each Payment Date, commencing with the first such date to occur after the date hereof, at maturity (whether by acceleration or otherwise) and, with respect to any USD Swing Line Loans on any date on which a USD Swing Line Loan is prepaid, whether due to acceleration or otherwise. Interest accrued on each Fixed Rate Loan (other than CDOR Loans which are governed by the Syndicated Canadian Addendum) shall be payable on the last day of its applicable Interest Period, on any date on which the Fixed Rate Loan is prepaid, whether by acceleration or otherwise, and at maturity. Interest accrued on each Fixed Rate Loan having an Interest Period longer than three months shall also be payable on the last day of each three-month interval during such Interest Period. Interest accrued on each Bid Rate Loan shall be payable as provided in Section 2.10(g). Interest accrued on the principal balance of all other Obligations shall be payable in arrears (i) upon repayment thereof in full, (ii) if not theretofore paid in full, at the time such other Obligation becomes due and payable (whether by acceleration or otherwise) and (iii) if not theretofore paid in full, on demand, commencing on the first such day following the date such Obligation became payable pursuant to the terms of this Agreement or the other Loan Documents.

(C) Fees. The relevant Borrowers shall, or shall cause their respective Subsidiaries to, pay to the Global Administrative Agent, for the account of each relevant Lender in accordance with their Pro Rata Shares and Syndicated Canadian Pro Rata Shares (as appropriate), on arrangements satisfactory to Harley and the Global Administrative Agent, a commitment fee accruing at the rate of the Applicable Commitment Fee Rate per annum from and after the date hereof until the Termination Date on the average daily unused amount of the Aggregate Commitment during a given calendar quarter calculated on the last Business Day of such calendar quarter. For purposes of calculating the average daily unused amount of the Aggregate Commitment, outstanding Swing Line Loans shall not be considered usage of the Aggregate Commitment. All such commitment fees payable under this clause (C) shall be payable quarterly in arrears on the last Business Day of each March, June, September and December occurring after the date hereof and, in addition, on the Termination Date.

(D) Interest and Fee Basis. (i) Interest on all Loans (other than Eurocurrency Rate Loans denominated in Pounds Sterling, Base Rate Loans with respect to which interest is calculated by reference to the Alternate Base Rate and USD Swing Line Loans), including all Syndicated Canadian Loans and all fees shall be calculated for actual days elapsed on the basis of a 360-day year (except as provided otherwise in the Syndicated Canadian Addendum). Interest on (a) Base Rate Loans with respect to which interest is calculated by reference to the Alternate Base Rate and USD Swing Line Loans and (b) Eurocurrency Rate Loans denominated in Pounds Sterling and Syndicated Canadian Loans shall in each case be calculated for actual days elapsed on the basis of a 365-day year or, when appropriate, 366-day year; provided that Stamping Fees shall be calculated for actual days elapsed on the basis of a 365-day year. Interest shall be payable for the day an Obligation is incurred but not for the day of any payment on the amount paid if payment is received by the times and in the offices required under Section 2.12. If any payment of principal of or interest on a Loan or any payment of any other Obligations shall become due on a day which is not a Business Day, such payment shall be made on the next succeeding Business Day and, in the case of a principal payment, such extension of time shall be included in computing interest in connection with such payment.

(ii) For purposes of the Interest Act (Canada), (a) whenever any interest or fee under this Agreement or any of the other Loan Documents is calculated using a rate based on a year of 360 days or 365 days, as the case may be, the rate determined pursuant to such calculation, when expressed as an

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annual rate, is equivalent to (1) the applicable rate based on a year of 360 days or 365 days, as the case may be, (2) multiplied by the actual number of days in the calendar year in which the period for which such interest or fee is payable (or compounded) ends, and (3) divided by 360 or 365, as the case may be, (b) the principle of deemed reinvestment of interest does not apply to any interest calculation under this Agreement, and (c) the rates of interest stipulated in this Agreement are intended to be nominal rates and are not effective rates or yields.

(E) Loan Account. Each Lender shall maintain in accordance with its usual practice an account or accounts (a “Loan Account”) evidencing the Obligations of the Borrowers to such Lender owing to such Lender from time to time, including the amount of principal and interest payable and paid to such Lender from time to time hereunder.

(F) Entries Binding. The entries made in the Register and each Loan Account shall be conclusive and binding for all purposes, absent manifest error, unless any Borrower objects to information contained in the Register and each Loan Account within thirty (30) days of such Borrower’s receipt of such information.

2.15 Notification of Advances, Interest Rates, Prepayments and Aggregate Commitment Reductions. Promptly after receipt thereof, the Global Administrative Agent will notify each relevant Lender of the contents of each Aggregate Commitment reduction notice, Borrowing Notice, Continuation/Conversion Notice and repayment notice received by it hereunder. The Global Administrative Agent will notify each relevant Lender of the interest rate applicable to each Fixed Rate Loan promptly upon determination of such interest rate.

2.16 Lending Installations. Each Lender may book its Loans at any Lending Installation reasonably selected by such Lender and may change its Lending Installation from time to time. All terms of this Agreement shall apply to any such Lending Installation and any Notes shall be deemed held by each Lender for the benefit of such Lending Installation. Each Lender may, by written or facsimile notice to the Global Administrative Agent and Harley, designate a Lending Installation through which Loans will be made by it and for whose account Loan payments are to be made.

2.17 Non-Receipt of Funds by the Global Administrative Agent. Unless a Borrower or a Lender, as the case may be, notifies the Global Administrative Agent prior to the date (or time, in the case of a Floating Rate Loan) on which it is scheduled to make payment to the Global Administrative Agent of (i) in the case of a Lender, the proceeds of a Loan or (ii) in the case of a Borrower, a payment of principal, interest or fees to the Global Administrative Agent for the account of the relevant Lenders, that it does not intend to make such payment, the Global Administrative Agent may assume that such payment has been made. The Global Administrative Agent may, but shall not be obligated to, make the amount of such payment available to the intended recipient in reliance upon such assumption. If such Lender or Borrower, as the case may be, has not in fact made such payment to the Global Administrative Agent, the recipient of such payment shall, on demand by the Global Administrative Agent, repay to the Global Administrative Agent the amount so made available together with interest thereon in respect of each day during the period commencing on the date such amount was so made available by the Global Administrative Agent until the date the Global Administrative Agent recovers such amount at a rate per annum equal to (i) in the case of payment by a Lender (other than in respect of any Loan denominated in Canadian Dollars), the Federal Funds Effective Rate for such day or (ii) in the case of payment by a Lender in respect of any Loan denominated in Canadian Dollars, the sum of the Canadian Prime Rate plus two percent (2%), or (iii) in the case of payment by a Borrower, the interest rate applicable to the relevant Loan (including without limitation pursuant to Section 2.11 if applicable).

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2.18 Termination Date. This Agreement shall be effective until the Termination Date. Notwithstanding the termination of this Agreement on the Termination Date, until all of the Obligations (other than contingent indemnity and reimbursement obligations, to the extent such obligations have not accrued) shall have been fully paid and satisfied and all financing arrangements under the Loan Documents among the Borrowers and the Lenders shall have been terminated, all of the rights and remedies under this Agreement and the other Loan Documents shall survive.

2.19 Judgment Currency. If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due from a Borrower hereunder or under the Syndicated Canadian Addendum in the currency expressed to be payable herein or under the Syndicated Canadian Addendum (the “specified currency”) into another currency, the parties hereto agree, to the fullest extent that they may effectively do so, that the rate of exchange used shall be that at which in accordance with normal banking procedures the Global Administrative Agent could purchase the specified currency with such other currency at the Global Administrative Agent’s main office in New York, New York on the Business Day preceding that on which the final, non-appealable judgment is given. The obligations of each Borrower in respect of any sum due to any Lender or the Global Administrative hereunder or under the Syndicated Canadian Addendum shall, notwithstanding any judgment in a currency other than the specified currency, be discharged only to the extent that on the Business Day following receipt by such Lender or the Global Administrative Agent (as the case may be) of any sum adjudged to be so due in such other currency such Lender or the Global Administrative Agent (as the case may be) may in accordance with normal, reasonable banking procedures purchase the specified currency with such other currency. If the amount of the specified currency so purchased is less than the sum originally due to such Lender or the Global Administrative Agent, as the case may be, in the specified currency, each Borrower agrees, to the fullest extent that it may effectively do so, as a separate obligation and notwithstanding any such judgment, to indemnify such Lender or the Global Administrative Agent, as the case may be, against such loss, and if the amount of the specified currency so purchased exceeds (a) the sum originally due to any Lender or the Global Administrative Agent, as the case may be, in the specified currency and (b) any amounts shared with other Lenders as a result of allocations of such excess as a disproportionate payment to such Lender under Section 11.2, such Lender or the Global Administrative Agent, as the case may be, agrees to remit such excess to such Borrower.

2.20 Termination as Borrower. So long as the principal of and interest on any Loans or Advances made to any Foreign Borrower under this Agreement or the Syndicated Canadian Addendum shall have been repaid or paid in full and all other obligations of such Foreign Borrower under this Agreement and the Syndicated Canadian Addendum shall have been fully performed, Harley may, by not less than five (5) Business Days’ prior notice to the Global Administrative Agent (which shall promptly notify the Lenders thereof), terminate such Foreign Borrower’s rights and obligations as a “Borrower”.

ARTICLE III CHANGE IN CIRCUMSTANCES

3.1 Yield Protection. If any law or any governmental or quasi-governmental rule, regulation, policy, guideline or directive (whether or not having the force of law) adopted after the date of this Agreement and having general applicability to all banks (or a Lender’s holding company or applicable Lending Installation for purposes of this Agreement) within the jurisdiction in which such Lender operates (excluding, for the avoidance of doubt, the effect of and phasing in of capital requirements or other regulations or guidelines passed prior to the date of this Agreement), or any interpretation or application thereof by any Governmental Authority charged with the interpretation or application thereof, or the compliance of any Lender therewith (any of the foregoing, a “Change in Law”; provided, however, that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements and directives thereunder or issued in connection therewith by any Governmental Authority charged with the interpretation or

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application thereof and (ii) all requests, rules, guidelines, requirements and directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued to the extent having general applicability to all banks (or a Lender’s holding company or applicable Lending Installation for purposes of this Agreement) within the jurisdiction in which the applicable Lender (or its holding company or such Lending Installation) operates),

(i) subjects the Global Administrative Agent, any Lender or any applicable Lending Installation to any taxes, duties, levies, imposts, deductions, assessments, fees, charges or withholdings (other than (A) Taxes, (B) Excluded Taxes and (C) Other Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto, or

(ii) imposes or increases or deems applicable any reserve, assessment, insurance charge, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender or any applicable Lending Installation with respect to its Fixed Rate Loans, or

(iii) imposes any other condition the result of which is to increase the cost to any Lender or any applicable Lending Installation of making, funding or maintaining the Fixed Rate Loans or reduces any amount received by any Lender or any applicable Lending Installation in connection with Fixed Rate Loans, or requires any Lender or any applicable Lending Installation to make any payment calculated by reference to the amount of Loans held or interest or fee received by it, by an amount deemed material by such Lender;

and the result of any of the foregoing is to increase the cost to that Person of making, renewing or maintaining its Commitment or Loans or to reduce any amount received under this Agreement, then, within 15 days after receipt by the relevant Borrower of written demand by such Person pursuant to Section 3.6, such Borrower shall pay such Person that portion of such increased expense incurred or reduction in an amount received which such Person determines is attributable to making, funding and maintaining its Loans and its Commitment or Syndicated Canadian Commitment as reasonably determined by such Person (which determination shall be made in good faith (and not on an arbitrary or capricious basis) and consistent with similarly situated customers of such Person under agreements having provisions similar to this Section 3.1 after consideration of such factors as such Person then reasonably determines to be relevant).

3.2 Changes in Capital Adequacy Regulations. If a Lender determines (i) the amount of capital or liquidity required or expected to be maintained by such Lender, any Lending Installation of such Lender or any corporation controlling such Lender is increased as a result of a “Change” (as defined below), and (ii) such increase in capital or liquidity will result in an increase in the cost to such Lender of maintaining its Loans or its obligation to make Loans hereunder, then, within 15 days after receipt by the relevant Borrower of written demand by such Lender pursuant to Section 3.6, such Borrower shall pay such Lender the amount necessary to compensate for any shortfall in the rate of return on the portion of such increased capital or liquidity which such Lender determines is attributable to this Agreement, its Loans or its obligation to make Loans hereunder (after taking into account such Lender’s policies as to capital adequacy and liquidity) as such amount is reasonably determined by such Lender (which determination shall be made in good faith (and not on an arbitrary or capricious basis) and consistent with similarly situated customers of the applicable Lender under agreements having provisions similar to this Section 3.2 after consideration of such factors as such Lender then reasonably determines to be relevant). “Change” means any adoption of or change in any other law, governmental or quasi-governmental rule,

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regulation, policy, guideline, interpretation, or directive (whether or not having the force of law) after the date of this Agreement and having general applicability to all banks and financial institutions within the jurisdiction in which such Lender operates which affects the amount of capital or liquidity required or expected to be maintained by any Lender or any Lending Installation or any corporation controlling any Lender (provided, however, that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements and directives thereunder or issued in connection therewith by any Governmental Authority charged with the interpretation or application thereof and (ii) all requests, rules, guidelines, requirements and directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change”, regardless of the date enacted, adopted or issued to the extent having general applicability to all banks (or a Lender’s holding company or applicable Lending Installation for purposes of this Agreement) within the jurisdiction in which the applicable Lender (or its holding company or such Lending Installation) operates).

3.3 Availability of Types of Advances. If (i) any Lender determines that maintenance of any of its Fixed Rate Loans at a suitable Lending Installation would violate any applicable law, rule, regulation or directive, whether or not having the force of law, or (ii) the Required Lenders with respect to Fixed Rate Advances or the Global Swing Line Lender with respect to Swing Line Loans determine that (x) deposits of a type, currency and maturity appropriate to match fund Fixed Rate Advances or Swing Line Loans, as applicable, are not available or (y) the interest rate applicable to a Fixed Rate Advance or Swing Line Loan does not accurately reflect the cost of making or maintaining such a Fixed Rate Advance or Swing Line Loans, then the Global Administrative Agent shall suspend the availability of Fixed Rate Advances or such Swing Line Loans of the affected Type or in the affected currency and, in the case of any occurrence set forth in clause (i), require any affected Fixed Rate Advances or Swing Line Loans to be repaid or, in the case of Eurocurrency Rate Loans in Dollars, at the option of the applicable U.S. Borrower, converted to Base Rate Advances or, in the case of any Loans to the Canadian Borrower, at the option of the Canadian Borrower, converted to Canadian Prime Rate Advances.

3.4 Funding Indemnification. If any payment of a Fixed Rate Advance, Fixed Rate Swing Line Loan or Bid Rate Advance occurs on a date which is not the last day of the applicable Interest Period in the case of a Fixed Rate Advance or Fixed Rate Swing Line Loans, or the applicable maturity date in the case of a Bid Rate Advance, whether because of acceleration, prepayment, assignment (to the extent such assignment is effected pursuant to Section 3.8) or otherwise, or a Fixed Rate Advance, Fixed Rate Swing Line Loan or Bid Rate Advance is not made or continued on the date specified by any Borrower for any reason other than default by the Lenders, Harley and such Borrower agrees to indemnify each Lender for any loss or cost (including lost profits) incurred by it resulting therefrom, including, without limitation, any loss or cost in liquidating or employing deposits acquired to fund or maintain the Fixed Rate Advance, Fixed Rate Swing Line Loan or Bid Rate Advance, as the case may be.

3.5 Taxes. (i) Unless such deduction is required by applicable law, all payments by any Borrower or any Guarantor to or for the account of any Lender or the Global Administrative Agent hereunder or under any Note shall be made free and clear of and without deduction for any and all Taxes. If any Borrower or any Guarantor shall be required by applicable law to deduct any Taxes from or in respect of any sum payable hereunder to any Lender or the Global Administrative Agent, then, except as otherwise specifically provided in this Section 3.5, (a) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 3.5) such Lender or the Global Administrative Agent (as the case may be) receives an amount equal to the sum it would have received had no such deductions been made, (b) such Borrower or Guarantor, as applicable, shall make such deductions, (c) such Borrower or Guarantor, as applicable, shall pay the full amount deducted to the relevant authority in accordance with applicable law and (d) such Borrower or Guarantor, as applicable, shall furnish to the Global Administrative Agent the original or a certified copy of a receipt evidencing payment thereof.

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(ii) In addition, except as otherwise specifically provided in this Section 3.5, each Borrower and Guarantor hereby agrees to pay any present or future stamp or documentary taxes and any other excise or property taxes, charges or similar levies which arise from any payment made hereunder by the relevant Borrower or Guarantor to the relevant Lender, or under any Note but excluding any such taxes, charges or levies in respect of any assignment, sale or transfer or participation (but excluding any participations and transfers pursuant to Section 2.2(E)) by any Lender or the Global Administrative Agent or from the execution or delivery of, or otherwise with respect to, this Agreement or any Note (“Other Taxes”).

(iii) Each Borrower and Guarantor hereby agree to indemnify the Global Administrative Agent and each Lender for the full amount of Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes imposed on amounts payable under this Section 3.5) paid by the Global Administrative Agent or such Lender and any liability (including penalties, interest and expenses) arising therefrom or with respect thereto; provided that each Borrower and Guarantor shall not be required to so indemnify to the extent any relevant amount is actually compensated for under any other provision of this Agreement. Payments due under this indemnification shall be made within 30 days of the date the Global Administrative Agent or such Lender makes demand therefor pursuant to Section 3.6.

(iv) At least five (5) Business Days prior to the first date on which interest or fees are payable hereunder for the account of any Syndicated Global Lender, such Lender to the extent it is not incorporated under the laws of the United States of America or a state thereof (each a “Non-U.S. Lender”) agrees that it will deliver to each of Harley, each Guarantor and the Global Administrative Agent (1) two duly completed copies of IRS Form W-8BEN or W-8ECI, certifying in either case that such Lender is entitled to receive payments under this Agreement without deduction or withholding of any United States federal income taxes or (2) in the case of a Non-U.S. Lender that is fiscally transparent, a copy of IRS Form W-8IMY together with the applicable accompanying forms, W-8 or W-9, as the case may be, and certify that it is entitled to an exemption from United States backup withholding tax (such certificate, an “Exemption Certificate”). Each Non-U.S. Lender further undertakes to deliver to each of Harley and the Global Administrative Agent (i) two renewals or additional copies of such form (or any successor form) on or before the date that such form expires or becomes obsolete, and (ii) after the occurrence of any event requiring a change in the most recent forms so delivered by it, such additional forms or amendments thereto as may be reasonably requested by Harley, any Guarantor or the Global Administrative Agent. All forms or amendments described in the preceding sentence shall certify that such Lender is entitled to receive payments under this Agreement without deduction or withholding of any United States federal income taxes, unless an event (including without limitation any change in treaty, law or regulation) has occurred prior to the date on which any such delivery would otherwise be required which renders all such forms inapplicable or which would prevent such Lender from duly completing and delivering any such form or amendment with respect to it and such Lender advises Harley, the Guarantors and the Global Administrative Agent that it is not capable of receiving payments without any deduction or withholding of United States federal income tax.

(v) For any period during which a Non-U.S. Lender has failed to provide Harley or the Guarantors with an appropriate form or Exemption Certificate pursuant to clause (iv) above (unless such failure is due to a change in treaty, law or regulation, or any change in the interpretation or administration thereof by any governmental authority, occurring subsequent to the date on which a form or Exemption Certificate originally was required to be provided), such Non-U.S. Lender shall not be entitled to indemnification under this Section 3.5 with respect to Taxes imposed by the United States; provided that, should a Non-U.S. Lender which is otherwise exempt from or subject to a reduced rate of withholding tax become subject to Taxes because of its failure to deliver a form or Exemption Certificate required under clause (iv), above, Harley or the Guarantors shall take such steps as such Non-U.S. Lender shall reasonably request to assist such Non-U.S. Lender to recover such Taxes.

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(vi) If a payment made to a Lender under any Loan Document would be subject to U.S. Federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to Harley and the Global Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by Harley or the Global Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Harley or the Global Administrative Agent as may be necessary for Harley and the Global Administrative Agent to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (vi), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

(vii) Each Lender shall severally indemnify the Global Administrative Agent, within 10 days after demand therefor, for (i) any Taxes attributable to such Lender (but only to the extent that the Borrowers have not already indemnified the Global Administrative Agent for such Taxes and without limiting the obligation of the Borrowers to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of Section 13.2(D) relating to the maintenance of a Participant Register and (iii) any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Global Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such amounts were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Global Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Global Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Global Administrative Agent to the Lender from any other source against any amount due to the Global Administrative Agent under this clause (vii).

(viii) [Reserved]

(ix) At least five (5) Business Days prior to the first date on which interest or fees are payable hereunder for the account of any Syndicated Canadian Bank or the Global Swing Line Lender in respect of Canadian Swing Line Loans to the Canadian Borrower, such Syndicated Canadian Bank or Global Swing Line Lender to the extent it is neither incorporated under the laws of a jurisdiction in Canada nor deemed to be a resident in Canada for purposes of Part XIII of the Income Tax Act (Canada) (each a “Non-Canadian Lender”) agrees that it will deliver to each of the Canadian Borrower and the Global Administrative Agent a certificate of a duly authorized officer of such Non-Canadian Lender to the effect that such Non-Canadian Lender is capable under the provisions of an applicable tax treaty or under the provisions of applicable law of receiving, and enabling the Canadian Borrower under the provisions of the Income Tax Act (Canada) to make, payments of interest or fees with respect to the Syndicated Canadian Loans and Canadian Swing Line Loans to the Canadian Borrower without deduction or withholding of income tax (such certificate, a “Canadian Exemption Certificate”). Each Non-Canadian Lender further undertakes to deliver to each of the Canadian Borrower and the Global Administrative Agent a replacement certificate of a duly authorized officer of such Non-Canadian Lender before or promptly upon the occurrence of any event requiring a change in the Canadian Exemption Certificate so delivered by it. All certificates described in the preceding sentences shall certify that such Non-Canadian Lender is entitled to receive interest or fees under this Agreement or the Syndicated Canadian Addendum without deduction or withholding of any applicable income taxes, unless an event (including without limitation

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any change in treaty, law or regulation) has occurred prior to the date on which any such delivery would otherwise be required which renders all such certificates inapplicable or which would prevent such Non-Canadian Lender from duly completing and delivering any such certificate with respect to it and such Non-Canadian Lender advises the Canadian Borrower and the Global Administrative Agent that it is not capable of receiving payments without any deduction or withholding of applicable income tax.

(x) For any period during which a Non-Canadian Lender has failed to provide the Canadian Borrower with an appropriate Canadian Exemption Certificate as required pursuant to clause (ix) above (unless such failure is due to a change in treaty, law or regulation, or any change in the interpretation or administration thereof by any governmental authority, occurring subsequent to the date on which a Canadian Exemption Certificate originally was required to be provided), such Non-Canadian Lender shall not be entitled to indemnification under this Section 3.5 with respect to Taxes imposed by the applicable jurisdiction in Canada; provided that, should a Non-Canadian Lender which is otherwise exempt from or subject to a reduced rate of withholding tax become subject to Taxes because of its failure to deliver a Canadian Exemption Certificate required under clause (ix), above, the Canadian Borrower shall take such steps as such Non-Canadian Lender shall reasonably request to assist such Non-Canadian Lender to recover such Taxes. In addition, neither any Syndicated Canadian Bank nor the Global Swing Line Lender shall be entitled to indemnification under this Section 3.5 with respect to Taxes imposed by the applicable jurisdiction in Canada other than indemnity obligations under this Section 3.5 arising out of a change after the Closing Date in any applicable treaty, law or regulation, or any change in the interpretation or administration thereof by any governmental authority.

(xi) If a Borrower or Guarantor pays an amount under this Section 3.5, or is required to make a deduction or withholding in relation to a payment hereunder or under any Note and account for the same to the relevant tax authority, which gives or may give rise to a Tax Credit for the recipient of that payment (the “Recipient”), the Recipient shall, promptly upon utilisation or receipt of such Tax Credit, pay an amount to such Borrower or the relevant Guarantor which will leave it (after that payment) in the same after-Tax position as it would have been in had the original amount paid under this Section 3.5 (or withheld or deducted pursuant to applicable law) not been required to have been made, withheld or deducted; provided that nothing in this clause (xi) shall require any Lender to make available its tax return (or any other information relating to its taxes which it deems confidential).

(xii) If (i) a Lender or the Global Administrative Agent assigns, transfers or sells all or any portion of its rights and/or delegates all or any portion of its obligations under this Agreement and the other Loan Documents (but excluding any participations and other transfers pursuant to Section 2.2(E)) or changes its Lending Installation for the purposes of this Agreement, and (ii) as a direct result of circumstances existing at the date of the assignment, transfer, sale, delegation or change, any Borrower or Guarantor would be obliged to pay any incremental amount under this Section 3.5, then the transferee or Lender acting through its new Lending Installation shall only be entitled to receive payment under this Section 3.5 to the same extent that the previous Lender or the Lender acting through its previous Lending Installation would have been entitled if no such transaction had taken place. If a Lender sells a participation in all or any part of its rights or obligations under this Agreement and the other Loan Documents, the participant shall only be entitled to receive payment under this Section 3.5 to the extent that the Lender selling the participation would have been entitled if no such participation had taken place. Notwithstanding the foregoing or anything else contained in this Section 3.5, in the event of a participation or transfer pursuant to Section 2.2(E), the participant shall be entitled to the indemnification under Sections 3.5(i) and 3.5(iii) in respect of any payments received pursuant to such participation or transfer.

3.6 Mitigation; Lender Statements; Survival of Indemnity. To the extent reasonably possible, each Lender shall designate an alternate Lending Installation with respect to its Fixed Rate Loans to

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reduce any liability of the relevant Borrower or the Guarantors to such Lender under Sections 3.1 and 3.2 or to avoid the unavailability of a Type of Advance under Section 3.3, so long as such designation is not materially disadvantageous to such Lender. Each Lender requiring compensation pursuant to this Article III shall notify the relevant Borrower and the Global Administrative Agent in writing of any Change, law, policy, rule, guideline or directive giving rise to such demand for compensation; provided that the relevant Borrower or Guarantor shall not be required to pay such amounts to the extent such amounts accrued prior to the date that is 180 days prior to the date of such notice; provided further that, if the circumstances giving rise to such amounts are retroactive, then such 180-day period shall be extended to include the period of retroactive effect thereof. Any demand for compensation pursuant to this Article III shall be in writing and shall state the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5 and shall set forth in reasonable detail the calculations upon which such Lender determined such amount. Such written demand shall be rebuttably presumed correct for all purposes. Determination of amounts payable under such Sections in connection with a Fixed Rate Loan shall be calculated as though each Lender funded its Fixed Rate Loan through the purchase of a deposit of the type, currency and maturity corresponding to the deposit used as a reference in determining the applicable fixed rate of interest with respect to such Loan, whether in fact that is the case or not. The obligations of the Borrowers and the Guarantors under Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of the Obligations and termination of this Agreement.

3.7 Non-U.S. Reserve Costs or Fees. If, any law or any governmental or quasi-governmental rule, regulation, policy, guideline or directive of any jurisdiction outside of the United States of America or any subdivision thereof and outside of England and Wales or any subdivision thereof (whether or not having the force of law), imposes or deems applicable any reserve requirement against or fee with respect to assets of, deposits with or for the account of, or credit extended by, any Lender or any applicable Lending Installation (other than any Tax), and the result of the foregoing is to increase the cost to such Lender or applicable Lending Installation of making or maintaining its Loans to any Foreign Borrower or its Commitment, Swing Line Commitment or Syndicated Canadian Commitment to any Borrower or to reduce the return received by such Lender or applicable Lending Installation in connection with such Loans to any Foreign Borrower or Commitment, Swing Line Commitment or Syndicated Canadian Commitment to any Foreign Borrower, then, within 15 days of demand by such Lender, such Foreign Borrower shall pay such Lender such additional amount or amounts as will compensate such Lender for such increased cost or reduction in amount received.

3.8 Replacement of Affected Lenders. If, any Lender requests compensation under Section 3.1, 3.2 or 3.7, or if any Borrower is required to pay any additional amount pursuant to Section 3.5, or if any Lender becomes a Defaulting Lender, then Harley may, at its sole expense and effort, upon notice to such Lender and the Global Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 13.3), all its interests, rights and obligations under this Agreement (other than any outstanding Bid Rate Loans held by it) to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) in the case of an assignment to an assignee which is not a Lender, Harley shall have received the prior written consent of the Global Administrative Agent, which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans (other than Bid Rate Loans) and participations in the relevant Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Harley (in the case of all other amounts) and (iii) in the case of any such assignment resulting from a claim for compensation under Sections 3.1, 3.2 or 3.7 or payments required to be made pursuant to Section 3.5, such assignment will result in a reduction in such compensation or payments with respect to the assignee Lender.

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ARTICLE IV CONDITIONS PRECEDENT

4.1 Initial Loans. This Agreement shall not become effective nor shall the Lenders be required to make the initial Loans unless (i) since December 31, 2011, no event, development or circumstance shall have occurred that has had, or could reasonably be expected to have, a material adverse effect on the business, assets, operations or financial condition of Harley and its subsidiaries taken as a whole, (ii) the Global Administrative Agent shall have received evidence of an effective amendment to the 4-Year Credit Agreement dated April 28, 2011 (the “Existing 4-Year Credit Agreement”) among inter alia Harley, HDFC, the guarantors party thereto, the lenders party thereto and JPMorgan Chase Bank, N.A., as global administrative agent, making conforming changes to the Existing 4-Year Credit Agreement to correspond with the terms of this Agreement other than in respect of pricing, maturity and borrowers and (iii) the Borrowers shall have (a) paid all fees required to be paid, and all expenses required to be paid for which invoices have been presented reasonably in advance of the Closing Date, in connection with the execution of this Agreement, (b) furnished to the Global Administrative Agent such documents as the Global Administrative Agent or any Lender or its counsel may have reasonably requested, including, without limitation, all of the documents reflected on the List of Closing Documents attached as Exhibit D to this Agreement, (c) obtained all governmental and third party approvals necessary in connection with the financing contemplated hereby and the continuing operations of Harley and its Subsidiaries (including the Borrowers) and such approvals remain in full force and effect, (d) delivered to the Lenders (1) audited consolidated financial statements of Harley (on a Consolidated basis), (2) audited Consolidated financial statements of HDFS and its Subsidiaries (on a Consolidated basis), in the case of each of the foregoing clauses (1) and (2), for the two most recent fiscal years ended prior to the Closing Date as to which such financial statements are available and (3) financial statement projections of (A) Harley (on a Consolidated basis) and (B) HDFS and its Subsidiaries, in the case of each of the foregoing clauses (A) and (B), for the 2012 fiscal year, together with key underlying assumptions in reasonable detail and (e) delivered evidence reasonably satisfactory to the Global Administrative Agent of the payment of all principal, interest, fees and premiums, if any, on all Indebtedness under the Existing Credit Agreement, and the termination of the applicable agreements relating thereto, all taking effect concurrently with the effectiveness of this Agreement; provided that any Lender hereunder which is also a “Lender” under the Existing Credit Agreement hereby waives any requirement of five (5) Business Days notice by the “Borrowers” under the Existing Credit Agreement prior to the reduction of the commitments thereunder and the termination thereof.

4.2 Each Loan. Except as expressly provided in Sections 2.2(E), 2.9.1(d), 2.9.2(e), 2.9.2(f), and 2.9.3(d), no Lender shall be required to make any Loan unless on the applicable Borrowing Date:

(i) at the time of and immediately after giving effect to such Advance or Loan, no Default or Unmatured Default shall have occurred and be continuing; and

(ii) the representations and warranties contained in Article V are true and correct in all material respects as of such Borrowing Date, except for representations and warranties made with reference solely to an earlier date, which representations and warranties shall be true and correct as of such earlier date; provided, that the representations set forth in Sections 5.1.6 and 5.1.7 shall be deemed to be made only (1) on and as of the Closing Date, (2) on and as of each date (if any) on which the Lenders agree to extend the Termination Date and (3) on and as of the effective date of any increase in the Commitments (if any).

Each Borrowing Notice with respect to each Loan or Advance shall constitute a representation and warranty by the applicable Borrower that the conditions contained in Sections 4.2(i) and (ii) will have been satisfied as of the date of such Loan or Advance.

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4.3 Initial Advance to the Canadian Borrower. No Syndicated Canadian Bank shall be required to make any Syndicated Canadian Loans to the Canadian Borrower unless the Canadian Borrower has furnished or caused to be furnished to the Global Administrative Agent with sufficient copies for the Syndicated Canadian Banks:

(A) The Syndicated Canadian Addendum executed and delivered by the Canadian Borrower and, if requested by the Global Administrative Agent, containing the written consent of Harley thereon.

(B) Copies of the Certificate of Incorporation (or other comparable constituent document) of the Canadian Borrower, together with all amendments and a certificate of good standing, both certified by the appropriate governmental officer in its jurisdiction of organization.

(C) Copies, certified by the Secretary or Assistant Secretary of the Canadian Borrower, of its By-Laws (or other comparable governing document) and of its Board of Directors’ (or comparable governing body’s) resolutions (and resolutions of other bodies, if any are deemed necessary by the Global Administrative Agent) approving the Syndicated Canadian Addendum.

(D) An incumbency certificate, executed by the Secretary, Assistant Secretary, Director or Authorized Officer of the Canadian Borrower, which shall identify by name and title and bear the signature of the officers of the Canadian Borrower authorized to sign the Syndicated Canadian Addendum and the other documents to be executed and delivered by the Canadian Borrower hereunder, upon which certificate the Global Administrative Agent and the Lenders shall be entitled to rely until informed of any change in writing by Harley or the Canadian Borrower.

(E) An opinion of counsel to the Canadian Borrower, in a form reasonably acceptable to the Global Administrative Agent and its counsel.

(F) Promissory notes payable to each of the Syndicated Canadian Banks requesting promissory notes.

(G) Such other instruments, documents or agreements as the Global Administrative Agent or its counsel may reasonably request, all in form and substance reasonably satisfactory to the Global Administrative Agent and its counsel.

ARTICLE V REPRESENTATIONS AND WARRANTIES

5.1 Representations and Warranties. Each of the Companies represents and warrants to the Lenders and the Global Administrative Agent as follows as of the Closing Date and thereafter on each date as and to the extent required by Section 4.2:

5.1.1 Corporate Existence and Standing. Each of the Companies and each Material Subsidiary is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of organization.

5.1.2 Corporate Power and Authority; No Conflict. The execution, delivery and performance by each of the Companies of this Agreement and the other Loan Documents to be delivered by it, and the consummation of the transactions contemplated hereby, are within such Company’s corporate powers, have been duly authorized by all necessary corporate action, and do not contravene (i) such Company’s charter or by-laws or (ii) law or any indenture or other agreement evidencing debt for borrowed money in an outstanding principal balance in excess of $25,000,000 or any material contractual restriction binding on or affecting any Company.

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5.1.3 No Authorization or Approval. No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or any other third party is required as a condition to the due execution, delivery and performance by the Companies of this Agreement or the other Loan Documents to be delivered by it.

5.1.4 Execution, Delivery and Enforceability. This Agreement has been, and each of the other Loan Documents to be delivered by each Company when delivered hereunder will have been, duly executed and delivered by such Company. This Agreement is, and each of the other Loan Documents when delivered hereunder will be, the legal, valid and binding obligation of each Company enforceable against such Company in accordance with their respective terms (subject to the effect of bankruptcy and other similar laws affecting creditors’ rights generally and general principles of equity).

5.1.5 Financial Statements. The Consolidated balance sheet of Harley and its Subsidiaries as at December 31, 2011, and the related Consolidated statements of income and cash flows of Harley and its Subsidiaries for the fiscal year then ended, accompanied by an opinion of Ernst & Young LLP, independent public accountants copies of which have been furnished to each Lender, fairly present in all material respects the Consolidated financial condition of Harley and its Subsidiaries as at such date and the Consolidated results of the operations of Harley and its Subsidiaries for the periods ended on such date, all in accordance with generally accepted accounting principles consistently applied.

5.1.6 Material Adverse Change. Since December 31, 2011, there has been no Material Adverse Change.

5.1.7 Litigation. There is no pending or threatened action, suit, investigation, litigation or proceeding, including, without limitation, any Environmental Action, affecting Harley or any of its Subsidiaries before any court, governmental agency or arbitrator that (i) would be reasonably likely to have a Material Adverse Effect or (ii) purports to affect the legality, validity or enforceability of this Agreement or any other Loan Document or the consummation of the transactions contemplated hereby.

5.1.8 Regulations T, U and X. No Borrower is engaged in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulations T, U and X issued by the Board of Governors of the Federal Reserve System), and no proceeds of any Advance will be used, directly or indirectly, to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying any margin stock that entails a violation of any of the Regulations of such Board of Governors.

5.1.9 Investment Company Status. No Borrower is an “investment company”, or a company “controlled” by an “investment company”, within the meaning of the Investment Company Act of 1940, as amended.

5.1.10 Disclosure. The Companies have disclosed to the Lenders all agreements, instruments and corporate or other restrictions to which it or any of their Subsidiaries is subject, and all other matters known to them, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. The Information Memorandum and the other reports, financial statements, certificates or other information furnished by or on behalf of the Companies or any Subsidiary to the Global Administrative Agent or any Lender in connection with the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished), collectively and taken as a whole, did not when furnished contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which statements are made; provided that, with respect to projected financial information contained therein, the Companies represent only that such information was prepared in good

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faith based upon assumptions believed by them to be reasonable (it being understood and agreed that projected financial information is simply an estimate, and there is no guarantee that projected results will in fact be achieved).

5.1.11 No Default. No Unmatured Default or Default has occurred and is continuing.

ARTICLE VI COVENANTS

6.1 Affirmative Covenants. So long as any Advance shall remain unpaid or any Lender shall have any Commitment hereunder, each Company will:

6.1.1 Compliance with Laws, Etc. Comply, and cause each of its Material Subsidiaries to comply, with all applicable laws, rules, regulations and orders, such compliance to include, without limitation, compliance with ERISA and Environmental Laws, in each case the violation of which would have a Material Adverse Effect.

6.1.2 Payment of Taxes, Etc. Pay and discharge, and cause each of its Material Subsidiaries to pay and discharge, before the same shall become delinquent, all income and other material taxes, assessments and governmental charges or levies imposed upon it or upon its Property; provided, however, that neither Harley nor any of its Material Subsidiaries shall be required to pay or discharge any such tax, assessment or charge that is being contested in good faith and by proper proceedings and as to which appropriate reserves are being maintained in accordance with Agreement Accounting Principles, unless and until any Lien resulting therefrom attaches to its Property and becomes enforceable against its other creditors.

6.1.3 Maintenance of Insurance. Maintain, and cause each of its Material Subsidiaries to maintain, insurance with responsible and reputable insurance companies or associations in such amounts and covering such risks as is usually carried by companies engaged in similar businesses and owning similar properties in the same general areas in which Harley or such Subsidiary operates; provided, however, that Harley and its Subsidiaries may self-insure to the same extent as other companies engaged in similar businesses and owning similar properties in the same general areas in which Harley or such Subsidiary operates and to the extent consistent with prudent business practice.

6.1.4 Preservation of Corporate Existence, Etc. Preserve and maintain, and cause each of its Material Subsidiaries to preserve and maintain, its corporate existence, rights (charter and statutory) and franchises; provided, however, that Harley and such Subsidiaries may consummate any transaction permitted under Section 6.2.3 and provided further that neither Harley nor any of its Material Subsidiaries shall be required to preserve any right or franchise if Harley or such Subsidiary shall determine that the preservation thereof is no longer desirable in the conduct of the business of Harley or such Subsidiary, as the case may be, and that the loss thereof is not disadvantageous in any material respect to Harley, such Subsidiary or the Lenders.

6.1.5 Visitation Rights. At any reasonable time and from time to time and (so long as no Unmatured Default has occurred and is continuing) upon reasonable notice, permit the Global Administrative Agent or any of the Lenders or any agents or representatives thereof, to examine and make copies of and abstracts from the records and books of account of, and visit the properties of, Harley and any of its Material Subsidiaries, and to discuss the affairs, finances and accounts of Harley and any of its Material Subsidiaries with any of their officers and with their independent certified public accountants; provided that unless an Unmatured Default has occurred and is continuing, Harley shall only be required to reimburse the Global Administrative Agent and each Lender for the expenses incurred by the Global Administrative Agent and each Lender for one such examination and visit by the Global Administrative Agent and each Lender in any calendar year.

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6.1.6 Keeping of Books. Keep, and cause each of its Material Subsidiaries to keep, proper books of record and account, in which full and correct entries, in all material respects, shall be made of all financial transactions and the assets and business of Harley and each such Subsidiary in accordance with generally accepted accounting principles in effect from time to time.

6.1.7 Maintenance of Properties, Etc. Maintain and preserve, and cause its Material Subsidiaries to maintain and preserve, all of its properties that are used or useful in the conduct of its business in good working order and condition, ordinary wear and tear excepted, except to the extent the failure to do so could not reasonably be expected to have a Material Adverse Effect.

6.1.8 Transactions with Affiliates. Conduct, and cause its Material Subsidiaries to conduct, all transactions otherwise permitted under this Agreement with any of their Affiliates other than Harley or a wholly-owned Subsidiary of Harley on terms that are fair and reasonable and no less favorable to such Company or its Material Subsidiaries, as applicable, than it would obtain in a comparable arm’s-length transaction with a Person not an Affiliate; provided that the foregoing shall not restrict or otherwise prohibit transactions between or among Harley and its Subsidiaries (to the extent Harley owns, directly or indirectly, at least 90% of the equity interests in each such Subsidiary) and not involving any other Affiliate.

6.1.9 Reporting Requirements. Furnish to the Global Administrative Agent:

(a) as soon as available and in any event no later than the date which is the earlier of (i) sixty (60) days after the end of each of the first three quarters of each fiscal year of Harley and (ii) the date the Quarterly Report on Form 10-Q for such quarter of Harley would have been required to have been filed under the rules and regulations of the Commission giving effect to any automatic extension available thereunder for filing of such form, the Consolidated balance sheet of Harley and its Subsidiaries and the Consolidated balance sheet of HDFS and its Subsidiaries, in each case as of the end of such quarter and Consolidated statements of income and cash flows of Harley and its Subsidiaries and Consolidated statements of income and cash flows of HDFS and its Subsidiaries, in each case for the period commencing at the end of the previous fiscal year and ending with the end of such quarter, duly certified (subject to the absence of footnotes and to year-end audit adjustments) by the chief financial officer or treasurer of Harley (on behalf of Harley and HDFS) as having been prepared in accordance with generally accepted accounting principles and certificates of the chief financial officer or treasurer of Harley as to compliance with the terms of this Agreement and setting forth in reasonable detail the calculations necessary to demonstrate compliance with Section 6.3;

(b) as soon as available and in any event no later than the date which is the earlier of (i) one hundred twenty (120) days after the end of each fiscal year of Harley and (ii) the date the Annual Report on Form 10-K for such fiscal year of Harley would have been required to have been filed under the rules and regulations of the Commission giving effect to any automatic extension available thereunder for filing of such form, a copy of the annual audit report for such year for Harley and its Subsidiaries, containing the Consolidated balance sheet of Harley and its Subsidiaries and the Consolidated balance sheet of HDFS and its Subsidiaries, in each case as of the end of such fiscal year and Consolidated statements of income and cash flows of Harley and its Subsidiaries and Consolidated statements of income and cash flows of HDFS and its Subsidiaries, in each case for such fiscal year, and in each case accompanied by an opinion ((1) without a “going concern” or like qualification or like exception and (2) other than a

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qualification permitted by the Commission regarding the internal controls of a company acquired during such period pursuant to a material acquisition by Harley or any Subsidiary, without any qualification or exception as to the scope of such audit) acceptable to the Required Lenders by Ernst & Young LLP or other independent public accountants acceptable to the Required Lenders and certificates of the chief financial officer or treasurer of Harley (on behalf of Harley and HDFS) as to compliance with the terms of this Agreement and setting forth in reasonable detail the calculations necessary to demonstrate compliance with Section 6.3;

(c) as soon as possible and in any event within five (5) Business Days after an executive officer of Harley knows or should have known of the occurrence of each Default or Unmatured Default continuing, a statement of the chief financial officer or treasurer of Harley setting forth details of such Default or Unmatured Default and the action that Harley has taken and proposes to take with respect thereto;

(d) promptly after the sending or filing thereof, copies of all reports that Harley sends to any of its securityholders as such, and copies of all reports on Forms 10-K, 10-Q and 8-K (or their equivalents) and registration statements (other than the exhibits thereto and any registration statements on Form S-8 or its equivalent) that Harley or any Subsidiary files with the Commission or any national securities exchange, excluding any of the foregoing to the extent related solely to a Permitted Finance Receivables Securitization (unless such report constitutes a notice of default or acceleration);

(e) promptly after the commencement thereof, notice of all actions and proceedings before any court, governmental agency or arbitrator affecting Harley or any of its Subsidiaries of the type described in Section 5.1.7(ii); and

(f) such other information respecting Harley or any of its Subsidiaries as any Lender through the Global Administrative Agent may from time to time reasonably request.

Financial statements (other than the certificate of the chief financial officer or the treasurer) required to be delivered pursuant to clauses (a), (b) and (d) of this Section 6.1.9 may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which such financial statements are filed for public availability on the Commission’s Electronic Data Gathering and Retrieval System; provided that Harley shall notify (which may be by facsimile or electronic mail) the Global Administrative Agent of the filing of any such financial statements.

6.1.10 Use of Proceeds. Each Borrower shall use the proceeds of the Loans to provide funds for the working capital needs and other general corporate purposes of such Borrower and its Subsidiaries and to repay outstanding Indebtedness.

6.2 Negative Covenants. So long as any Advance shall remain unpaid or any Lender shall have any Commitment hereunder, each of the Companies will not:

6.2.1 Subsidiary Indebtedness. Permit any Material Subsidiaries (excluding HDFS and HDFC) to create, incur, assume or suffer to exist any Indebtedness, except any one or more of the following types of Indebtedness:

(a) the Obligations and any other Indebtedness created under the Loan Documents;

(b) Indebtedness existing or contemplated on the Closing Date and set forth on

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Schedule 6.2.1(b) and extensions, renewals and replacements of any such Indebtedness with Indebtedness of a similar type to the extent that such extension, renewal or replacement does not increase the principal amount thereof;

(c) Indebtedness of any Subsidiary of Harley incurred pursuant to any Permitted Finance Receivables Securitization (including, without limitation, any Permitted Securitization Recourse Obligations);

(d) Indebtedness of any Subsidiary of Harley to any Company or any other Subsidiary of Harley;

(e) Indebtedness subject to a Lien permitted to secure such Indebtedness pursuant to Section 6.2.2;

(f) Indebtedness of any Subsidiary as an account party in respect of trade letters of credit;

(g) guarantees in respect of Indebtedness of Harley or any Subsidiary of Harley that is otherwise permitted hereunder;

(h) Indebtedness arising under capitalized leases and purchase money obligations, in each case to finance the purchase, repair or improvement of fixed or capital assets, and extensions, renewals and replacements thereof, provided that any Lien in respect thereof shall be subject to the proviso in Section 6.2.2(b);

(i) Indebtedness assumed in connection with any acquisition not prohibited under this Agreement (or, to the extent the principal amount thereof does not exceed the Indebtedness refinanced or replaced, Indebtedness incurred to refinance or replace any Indebtedness that would otherwise be assumed in connection with such an acquisition, but otherwise excluding Indebtedness incurred in contemplation of such an acquisition) and extensions, renewals and replacements of any such Indebtedness with Indebtedness of a similar type to the extent that such extension, renewal or replacement does not increase the principal amount thereof;

(j) Indebtedness representing deferred compensation to employees incurred in the ordinary course of business;

(k) Indebtedness consisting of promissory notes issued to future, present or former directors, officers, members of management, employees or consultants or their respective estates, heirs, family members, spouses or former spouses to finance the purchase or redemption of equity interests to the extent not prohibited by this Agreement;

(l) Indebtedness incurred in connection with acquisitions or dispositions not prohibited under this Agreement constituting indemnification obligations or the adjustment of the purchase price or similar adjustments;

(m) Indebtedness under deferred compensation, retiree healthcare medical benefits or other similar employment arrangements incurred in connection with acquisitions or dispositions not prohibited under this Agreement;

(n) Indebtedness incurred in respect of cash management services, netting

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services, overdraft protection (so long as such overdraft is not outstanding for a period of more than two (2) Business Days) and similar arrangements, in each case in the ordinary course of business;

(o) Indebtedness consisting of take-or-pay obligations contained in supply or similar arrangements in the ordinary course of business;

(p) Indebtedness constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business in respect of workers compensation claims, health, disability or other employee benefits or property, casualty or liability insurance or self-insurance or other Indebtedness with respect to reimbursement-type obligations regarding workers compensation claims; provided that upon the drawing of such letters of credit or the incurrence of such Indebtedness, such obligations are reimbursed within thirty (30) days following such drawing or incurrence;

(q) obligations in respect of performance and surety, stay, customs, appeal and performance bonds and performance and completion guarantees or obligations in respect of letters of credit in respect thereof, in each case in the ordinary course of business;

(r) Hedging Obligations incurred in the ordinary course of business and not for speculative purposes;

(s) unsecured Indebtedness of Harley-Davidson Financial Services Canada, Inc. and its Subsidiaries (including successors and assigns) in an aggregate principal amount not exceeding $400,000,000 at any time outstanding;

(t) Subordinated Indebtedness and Subordinated Intercompany Indebtedness; and

(u) unsecured Indebtedness not otherwise permitted under this Section 6.2.1 in an aggregate principal amount not exceeding at any time outstanding the greater of (i) $150,000,000 and (ii) an amount equal to 1.5% of the Consolidated Total Assets (determined by reference to the most recent financial statements of Harley delivered pursuant to Section 6.1.9(a) or 6.1.9(b) or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 6.1.9(a) or 6.1.9(b), the most recent financial statements referred to in Section 5.1.5) as determined at the time of, and immediately after giving effect to, the incurrence of such Indebtedness.

6.2.2 Liens, Etc. Create or suffer to exist, or permit any Material Subsidiaries to create or suffer to exist, any Lien on or with respect to any of its properties, whether now owned or hereafter acquired, or assign for security purposes, or permit any Material Subsidiaries to assign for security purposes, any right to receive income, other than:

(a) Permitted Liens;

(b) purchase money Liens upon or in any real Property or goods acquired or held by any of the Companies or any Material Subsidiary in the ordinary course of business to secure the purchase price of such Property or goods or to secure Indebtedness incurred solely for the purpose of financing the acquisition of such real Property or goods, or Liens existing on such real Property or goods at the time of its acquisition (other than any such Liens created in contemplation of such acquisition that were not incurred to finance the acquisition of such

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Property) or extensions, renewals or replacements of any of the foregoing for the same or a lesser amount; provided, however, that no such Lien shall extend to or cover any properties of any character other than the real Property or goods being acquired (and related Property), and no such extension, renewal or replacement shall extend to or cover any properties not theretofore subject to the Lien being extended, renewed or replaced (it being understood that individual financings permitted by this subsection provided by one Person (or an Affiliate thereof) may be cross-collateralized to other financings provided by such Person and its Affiliates that are permitted under this subsection); provided, further that the aggregate principal amount of the Indebtedness secured by the Liens referred to in this clause (b) shall not exceed $150,000,000 (for the purposes of this Section 6.2.2(b), “goods” has the meaning set forth in Section 9-102(44) of the Uniform Commercial Code as in effect in the State of New York);

(c) the Liens existing on the Closing Date and described on Schedule 6.2.2(c) hereto;

(d) Liens on (or assignments of) Property of a Person existing at the time such Person is merged into or consolidated with any of the Companies or any Material Subsidiary of any of the Companies or becomes a Material Subsidiary of any of the Companies or at the time any of the Companies or any Material Subsidiary of any of the Companies otherwise acquires such Property from such Person; provided that such Liens or assignments were not created in contemplation of such merger, consolidation or acquisition, or such Person becoming a Material Subsidiary, and do not extend to any assets other than those of the Person so merged into or consolidated with any of the Companies or such Subsidiary or acquired by any of the Companies or such Subsidiary or those of such Person becoming a Material Subsidiary;

(e) other Liens or assignments securing Indebtedness and other obligations in an aggregate principal amount not to exceed at any time outstanding the greater of (i) $150,000,000 and (ii) an amount equal to 1.5% of the Consolidated Total Assets (determined by reference to the most recent financial statements of Harley delivered pursuant to Section 6.1.9(a) or 6.1.9(b) or, if prior to the date of the delivery of the first financial statements to be delivered pursuant to Section 6.1.9(a) or 6.1.9(b), the most recent financial statements referred to in Section 5.1.5) as determined at the time of, and immediately after giving effect to, the incurrence of such Lien or the making of such assignment;

(f) Liens (A) consisting of sales, assignments, pledges or other transfers of Finance Receivables in connection with a Permitted Finance Receivables Securitization, and (B) on Finance Receivables and on any interest in Finance Receivables retained by Harley or any of its Subsidiaries (including a Finance Receivables Subsidiary), whether directly or through the ownership of a certificate or other interest in another Person, provided to secure Permitted Securitization Recourse Obligations of Harley or any of its Subsidiaries;

(g) the replacement, extension or renewal of any Lien or assignment permitted by clause (c) or (d) above upon or in the same Property theretofore subject thereto or the replacement, extension or renewal (without increase in the amount or change in any direct or contingent obligor) of the Indebtedness or other obligation secured thereby;

(h) Liens incurred in connection with sale and leaseback transactions securing assets or other Property with a value of not in excess of 5% of the Consolidated shareholders’ equity of Harley as shown on the then most recent annual Consolidated financial statements of Harley;

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(i) Liens on proceeds of any of the assets permitted to be the subject of any Lien or assignment permitted by this Section 6.2.2; and

(j) options, put and call arrangements, rights of first refusal and similar rights relating to investments in joint ventures, partnerships and other similar investments not prohibited by this Agreement.

6.2.3 Mergers, Etc. Merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of (whether in one transaction or in a series of related transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to, any Person, or permit any of its Material Subsidiaries to do so, except that (i) any Subsidiary (other than any Company) may merge or consolidate with or into, or transfer, convey or dispose of assets to, any other Subsidiary, (ii) any of the Companies and any Material Subsidiary may merge into or transfer, convey or dispose of assets to any of the Companies, (iii) Harley may merge into a wholly-owned Subsidiary that has no material assets or liabilities for the sole purpose of changing the state of incorporation of Harley if the surviving corporation shall expressly assume the liabilities of Harley under this Agreement and the other Loan Documents and (iv) any Guarantor may merge or consolidate with a Person (other than a Borrower) in a transaction in which such Guarantor is the surviving entity; provided, in each case, that no Unmatured Default shall have occurred and be continuing at the time of such proposed transaction or would result after giving effect thereto and provided, further, that the foregoing shall not restrict any of the Companies or any Material Subsidiaries in respect of dispositions of inventory, cash or obsolete, used or surplus equipment or other Property in the ordinary course of business or in respect of any Permitted Finance Receivables Securitization and provided, further, that the foregoing shall not restrict any of the Companies or any Material Subsidiaries from selling or disposing of any Property the contemplated disposition of which Harley has disclosed in any Annual Report on Form 10-K, Quarterly Report on Form 10-Q or Current Report on Form 8-K filed with or furnished to the Commission prior to the Closing Date.

6.2.4 Accounting Changes. Make or permit, or permit any of its Material Subsidiaries to make or permit, any change in accounting policies or reporting practices, except as required or permitted by generally accepted accounting principles.

6.2.5 Changes in Nature of Business. Make, or permit any of its Material Subsidiaries to make, any material change in the nature of the business of Harley and its Subsidiaries taken as a whole as carried on at the date hereof (other than any contemplated disposition described in the third proviso to Section 6.2.3).

6.2.6 Margin Regulations. Permit more than 25% of the “value” (within the meaning of Regulation U issued by the Board of Governors of the Federal Reserve System) of the assets of Harley and its Subsidiaries, both before and after giving effect to any Advance hereunder, to constitute “margin stock” as defined in Regulations T, U and X issued by the Board of Governors of the Federal Reserve System.

6.2.7 Amendments to Support Agreement. Allow or suffer to exist any amendment, supplement or other modification to the Support Agreement (if the foregoing adversely affects, or could reasonably be expected to adversely affect, the Lenders but in no event shall any amendment reduce, or effectively reduce, the amount of support under the Support Agreement) without the prior written consent of the Required Lenders.

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6.3 Financial Covenants. So long as any Advance shall remain unpaid or any Lender shall have any Commitment hereunder, the Companies shall comply with the following:

(A) Defined Terms for Financial Covenants. The following terms used in this Agreement shall have the following meanings (such meanings to be applicable, except to the extent otherwise indicated in a definition of a particular term, both to the singular and the plural forms of the terms defined):

“Consolidated EBITDA” means, for any period, net income (or net loss) of Harley and its Consolidated Subsidiaries in accordance with Agreement Accounting Principles plus the sum of (a) Consolidated Interest Expense, (b) taxes on or measured by income (including franchise taxes imposed in lieu of income taxes), (c) depreciation expense, (d) amortization expense, (e) non-recurring cash restructuring expenses not to exceed $150,000,000 incurred in any fiscal year of Harley, (f) other non-cash or extraordinary charges and (g) losses arising from discontinued operations minus (h) any cash payments made during such period in respect of any non-cash charges previously added back to Consolidated EBITDA in accordance with the foregoing clause (f) and paid subsequent to the fiscal quarter in which such non-cash charge was incurred and (i) income or gains arising from discontinued operations, in each case determined in accordance with Agreement Accounting Principles for such period. For the purposes of calculating Consolidated EBITDA for any period, if during such period Harley or any Subsidiary shall have made an acquisition or a disposition, Consolidated EBITDA for such period shall be calculated after giving pro forma effect thereto as if such acquisition or disposition occurred on the first day of such period.

“Consolidated Equity” means and refers to, as of the end of any period of determination, the sum, without duplication, of (i) Consolidated Tangible Net Worth of HDFS, (ii) preferred stock and (iii) Subordinated Indebtedness.

“Consolidated Finco Debt” means, at any time, all Indebtedness of HDFS and its Consolidated Subsidiaries as reflected in the most recent Consolidated balance sheet of HDFS in accordance with Agreement Accounting Principles; provided, there shall be excluded from such amounts (i) Subordinated Indebtedness and (ii) Subordinated Intercompany Indebtedness.

“Consolidated Interest Expense” means, with respect to Harley and its Consolidated Subsidiaries for any fiscal period, interest expense (whether cash or non-cash) determined in accordance with Agreement Accounting Principles for the relevant period ended on such date and including interest expense for the relevant period that has been capitalized on the balance sheet.

“Consolidated Tangible Net Worth” of HDFS means its consolidated shareholders’ equity net of intangible assets, as shall be determined in accordance with Agreement Accounting Principles.

“Finco Leverage Ratio” means the ratio of (a) Consolidated Finco Debt to (b) Consolidated Equity.

“Interest Coverage Ratio” means the ratio of (a) Consolidated EBITDA to (b) Consolidated Interest Expense.

“Subordinated Indebtedness” means Indebtedness of Harley or its Subsidiaries, whether direct or indirect, to non-affiliated Persons which is subordinated to the Obligations on a basis acceptable to the Global Administrative Agent.

(B) Maximum Finco Leverage Ratio. The Companies shall not permit the Finco Leverage Ratio, as of the end of any fiscal quarter, to exceed 10.00 to 1.00.

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(C) Minimum Interest Coverage Ratio. Harley shall not permit its Interest Coverage Ratio, as of the end of any fiscal quarter for the period of four consecutive fiscal quarters then ended, to be less than the ratio set forth below opposite such date:

Fiscal Quarter Ending	Minimum Interest Coverage Ratio
March 31, 2012 through June 30, 2013	2.25 to 1.00
September 30, 2013 and each fiscal quarter ending thereafter	2.50 to 1.00

ARTICLE VII DEFAULTS

7.1 Defaults. Each of the following occurrences shall constitute a Default under this Agreement:

(a) Failure to Make Payments When Due. Any Borrower (i) shall fail to pay any principal of any Advance when the same becomes due and payable or (ii) shall fail to pay any interest on any Advance or make any other payment of fees or other amounts payable under this Agreement or any other Loan Document within five (5) Business Days after the same becomes due and payable.

(b) Breach of Representation or Warranty. Any representation or warranty made by any Company herein or by any Company (or any of their respective officers) in connection with this Agreement shall prove to have been incorrect in any material respect when made.

(c) Breach of Certain Covenants. (i) Any of the Companies shall fail to perform or observe any term, covenant or agreement under Section 6.1.4, 6.1.5, 6.1.9, 6.2, or 6.3 or (ii) any of the Companies shall fail to perform or observe any other term, covenant or agreement contained in this Agreement or any other Loan Document on its part to be performed or observed if such failure shall remain unremedied for thirty (30) days after written notice thereof shall have been given to the applicable Company by the Global Administrative Agent or any Lender.

(d) Default as to Other Indebtedness. (i) Any Borrower or any Material Subsidiary shall fail to pay any principal of or premium or interest on any Indebtedness (other than Indebtedness owed to any Borrower or any Material Subsidiaries) that is outstanding in a principal or net amount of at least $100,000,000 in the aggregate (but excluding (1) Indebtedness outstanding hereunder and (2) Indebtedness under a Permitted Finance Receivables Securitization) of such Borrower or such Material Subsidiary (as the case may be), when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise), and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument relating to such Indebtedness; or (ii) or any event shall occur or condition shall exist under any agreement or instrument relating to any such Indebtedness (including, for the avoidance of doubt, such Indebtedness under a Permitted Finance Receivables Securitization to the extent such Indebtedness appears as a liability or indebtedness on the balance sheet of any Borrower or any Material Subsidiary in accordance with Agreement Accounting Principles – “Balance Sheet ABS Debt”) and shall continue after the applicable grace period, if any, specified in such agreement or instrument, if the effect of such event or condition is to enable or permit the holder or holders of any such Indebtedness to cause such Indebtedness to become due, or require the prepayment, repurchase, redemption or defeasance thereof, prior to its stated maturity date (other than by a regularly scheduled required

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prepayment or redemption); or any such Indebtedness (including Balance Sheet ABS Debt) shall be declared to be due and payable, or required to be prepaid or redeemed (other than by a regularly scheduled required prepayment or redemption), purchased or defeased, or an offer to prepay, redeem, purchase or defease such Indebtedness (including Balance Sheet ABS Debt) shall be required to be made, in each case prior to the stated maturity thereof.

(e) Bankruptcy Events, Etc. Any Borrower or any Material Subsidiary shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts generally, or shall make a general assignment for the benefit of creditors; or any proceeding shall be instituted by or against any Borrower or any Material Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief, or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for it or for any substantial part of its Property and, in the case of any such proceeding instituted against it (but not instituted by it), either such proceeding shall remain undismissed for a period of sixty (60) days, or any of the actions sought in such proceeding (including, without limitation, the entry of an order for relief against, or the appointment of a receiver, trustee, custodian or other similar official for, it or for any substantial part of its Property) shall occur; or any such Borrower or any such Material Subsidiary shall take any corporate action to authorize any of the actions set forth above in this Section 7.1(e).

(f) Monetary Judgments. Judgments or orders for the payment of money in excess of $100,000,000 in the aggregate shall be rendered against any Borrower or any Material Subsidiary with respect to which (i) enforcement proceedings shall have been commenced by any creditor upon such judgments or orders or (ii) there shall be any period of ten (10) consecutive days during which a stay of enforcement of such judgments or orders, by reason of a pending appeal or otherwise, shall not be in effect; provided, however, that any such judgment or order shall not be a Default or included in the calculation of the aggregate amount of judgments or orders under this Section 7.1(f) if and for so long as (i) the amount of such judgment or order is covered by a valid and binding policy of insurance between the defendant and the insurer covering payment thereof and (ii) such insurer, which shall be rated at least “A” by A.M. Best Company, has been notified of, and has not disputed the claim made for payment of, the amount of such judgment or order.

(g) Non-Monetary Judgments. Any non-monetary judgment or order shall be rendered against any Borrower or any Material Subsidiary that would be reasonably expected to have a Material Adverse Effect, and there shall be any period of ten (10) consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect.

(h) Change of Control. A Change of Control shall occur.

(i) ERISA. Harley or any of its ERISA Affiliates shall incur, or shall be reasonably likely to incur, liability in excess of $100,000,000 in the aggregate as a result of one or more of the following: (i) the occurrence of any ERISA Event; (ii) the partial or complete withdrawal of Harley or any of its ERISA Affiliates from a Multiemployer Plan; or (iii) the reorganization or termination of a Multiemployer Plan.

(j) Guaranty Default. Unless a Guarantor has merged or consolidated with another Company as permitted under Section 6.2.3, any Guarantor shall terminate, revoke, refuse to perform or otherwise breach any of its guaranty and other obligations contained in Article XII, or such guaranty shall otherwise become unenforceable for any reason.

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(k) Support Agreement Default. Harley shall terminate, revoke, refuse to perform or otherwise breach any of its obligations contained in the Support Agreement or such Support Agreement or any part thereof shall terminate or otherwise become unenforceable for any reason.

A Default shall be deemed “continuing” until cured or until waived in writing in accordance with Section 8.3.

ARTICLE VIII ACCELERATION, DEFAULTING LENDERS; WAIVERS, AMENDMENTS AND REMEDIES

8.1 Remedies

(a) Termination of Commitments; Acceleration. If any Default described in Section 7.1(e) occurs with respect to any Borrower, the obligations of the Lenders to make Loans (including without limitation Syndicated Canadian Loans) hereunder shall automatically terminate and the Obligations shall immediately become due and payable without any election or action on the part of the Global Administrative Agent or any Lender. If any other Default occurs, the Required Lenders may (i) terminate the obligations of the Lenders to make Loans (including without limitation Syndicated Canadian Loans) hereunder or (ii) declare the Obligations to be due and payable, or both, and upon any declaration under clause (ii), the Commitments shall terminate and the Obligations shall become immediately due and payable, without presentment, demand, protest or notice of any kind, all of which each Borrower expressly waives.

(b) Rescission. If, at any time after termination of the Lenders’ obligations to make Loans but before acceleration of the maturity of the Loans, the relevant Borrower shall pay all arrears of interest and all payments on account of principal of the Loans which shall have become due otherwise than by acceleration (with interest on principal and, to the extent permitted by law, on overdue interest, at the rates specified in this Agreement) and all Defaults and Unmatured Defaults (other than nonpayment of principal of and accrued interest on the Loans due and payable solely by virtue of acceleration) shall be remedied or waived pursuant to Section 8.3, then upon the written consent of the Required Lenders and written notice to Harley, the termination of Lenders’ respective obligations to make Loans or the aforesaid acceleration and its consequences may be rescinded and annulled; but such action shall not affect any subsequent Default or Unmatured Default or impair any right or remedy consequent thereon. The provisions of the preceding sentence are intended merely to bind the Lenders to a decision which may be made at the election of the Required Lenders; they are not intended to benefit any Borrower and do not give any Borrower the right to require the Lenders to rescind or annul any termination of the aforesaid obligations of the Lenders or any acceleration hereunder, even if the conditions set forth herein are met.

8.2 Defaulting Lender. In the event that any Lender fails to fund its Pro Rata Share or Syndicated Canadian Pro Rata Share (as applicable) of any Syndicated Global Advance or Syndicated Canadian Advance requested or deemed requested by the applicable Borrower which such Lender is obligated to fund under the terms of this Agreement (the funded portion of such Advance being hereinafter referred to as a “Non Pro Rata Loan”) or any Lender otherwise becomes a Defaulting Lender, until the earlier of such Lender’s cure of such failure and the termination of the Commitments,

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the proceeds of all amounts thereafter repaid to the Global Administrative Agent by any Borrower and otherwise required to be applied to such Lender’s share of all other Obligations pursuant to the terms of this Agreement shall be advanced to the applicable Borrower by the Global Administrative Agent (“Cure Loans”) on behalf of such Lender to cure, in full or in part, such failure by such Lender, but shall nevertheless be deemed to have been paid to such Lender in satisfaction of such other Obligations. Notwithstanding anything in this Agreement to the contrary:

(i) the foregoing provisions of this Section 8.2 shall apply only with respect to the proceeds of payments of Obligations and shall not affect the conversion or continuation of Loans pursuant to Section 2.8;

(ii) any Defaulting Lender shall be deemed to have cured its failure to fund its Pro Rata Share of any Syndicated Global Advance or Syndicated Canadian Pro Rata Share of any Syndicated Canadian Advance at such time as an amount equal to such Defaulting Lender’s original Pro Rata Share or Syndicated Canadian Pro Rata Share (as applicable) of the requested principal portion of such Advance is fully funded to the applicable Borrower, whether made by such Defaulting Lender itself or by operation of the terms of this Section 8.2, and whether or not the Non Pro Rata Loan with respect thereto has been repaid, converted or continued;

(iii) amounts advanced to any Borrower to cure, in full or in part, any such Defaulting Lender’s failure to fund its Pro Rata Share of any Syndicated Global Advance or Syndicated Canadian Pro Rata Share of any Syndicated Canadian Advance shall be redenominated in the relevant currency and shall bear interest at the rate applicable to Syndicated Global Loans which are Base Rate Loans or Syndicated Canadian Loans which are Canadian Prime Rate Loans (as applicable), in effect from time to time, and for all other purposes of this Agreement shall be treated as if they were Base Rate Loans or Canadian Prime Rate Loans (as applicable);

(iv) regardless of whether or not a Default has occurred or is continuing, and notwithstanding the instructions of any Borrower as to its desired application, all repayments of principal which, in accordance with the other terms of this Agreement, would be applied to the outstanding Base Rate Loans or Canadian Prime Rate Loans shall be applied first, ratably to all Base Rate Loans or Canadian Prime Rate Loans (as applicable) constituting Non Pro Rata Loans, second, ratably to Base Rate Loans or Canadian Prime Rate Loans (as applicable) other than those constituting Non Pro Rata Loans or Cure Loans and, third, ratably to Base Rate Loans or Canadian Prime Rate Loans (as applicable) constituting Cure Loans;

(v) for so long as and until the earlier of any such Defaulting Lender’s cure of all matters that caused such Lender to be a Defaulting Lender and the termination of the Commitments or Syndicated Canadian Commitments (as applicable), (1) the term “Required Lenders” for purposes of this Agreement shall mean Lenders (excluding all Defaulting Lenders) whose Pro Rata Shares represent greater than fifty-one percent (51%) of the aggregate Pro Rata Shares of such Lenders and (2) the term “Required Syndicated Canadian Banks” for purposes of this Agreement shall mean Syndicated Canadian Banks (excluding all Defaulting Lenders) whose Syndicated Canadian Pro Rata Shares represent greater than fifty-one percent (51%) of the aggregate Syndicated Canadian Pro Rata Shares of such Syndicated Canadian Banks;

(vi) for so long as and until any such Defaulting Lender’s cure of all matters that caused such Lender to be a Defaulting Lender, such Defaulting Lender shall not be entitled to any fees with respect to its Commitment or Syndicated Canadian Commitment (as applicable), which fees shall accrue in favor of the Lenders which are not Defaulting Lenders and shall be allocated among such Lenders ratably based upon their relative Commitments or Syndicated Canadian Commitments (as applicable);

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(vii) for so long as and until any such Defaulting Lender’s cure of all matters that caused such Lender to be a Defaulting Lender, if any Swing Line Exposure exists at the time a Lender is a Defaulting Lender, the applicable Borrower shall within one Business Day following notice by the Global Administrative Agent prepay such Swing Line Exposure or, if agreed by the Global Swing Line Lender, cash collateralize the Swing Line Exposure of such Defaulting Lender on terms satisfactory to the Global Swing Line Lender; and

(viii) for so long as and until any such Defaulting Lender’s cure of all matters that caused such Lender to be a Defaulting Lender, the Global Swing Line Lender shall not be required to fund any Swing Line Loan.

8.3 Amendments. Subject to the provisions of this Article VIII, the Required Lenders (or the Global Administrative Agent with the consent in writing of the Required Lenders) and the Borrowers may enter into agreements supplemental hereto for the purpose of adding or modifying any provisions to the Loan Documents or changing in any manner the rights of the Lenders or the Borrowers hereunder or waiving any Default hereunder; provided, however, that (a) no such supplemental agreement shall, without the consent of each Lender directly affected thereby:

(i) postpone or extend the Termination Date or any other date fixed for any payment of principal of, or interest on, the Loans or any fees or other amounts payable to such Lender (except with respect to a waiver of the application of the default rate of interest pursuant to Section 2.11 hereof);

(ii) reduce the principal amount of any Loans, or reduce the rate or extend the time of payment of interest or fees thereon or other amounts payable hereunder;

(iii) reduce the percentage specified in the definition of Required Lenders or any other percentage or number of Lenders specified to be the applicable percentage or number in this Agreement to act on specified matters or amend the definitions of “Required Lenders”, “Required Syndicated Canadian Banks”, “Pro Rata Share” or “Syndicated Canadian Pro Rata Share”;

(iv) increase the amount of the Commitment of any Syndicated Global Lender or the Syndicated Canadian Commitment of any Syndicated Canadian Bank or increase any Lender’s Pro Rata Share or any Syndicated Canadian Bank’s Syndicated Canadian Pro Rata Share;

(v) permit any Borrower to assign its rights under this Agreement;

(vi) notwithstanding anything to the contrary in the Support Agreement, release Harley from any of its obligations under the Support Agreement or otherwise terminate the Support Agreement;

(vii) release any Guarantor other than in accordance with the terms of the Loan Documents;

(viii) alter the manner in which payments or prepayments of principal, interest or other amounts under the Loan Documents shall be applied as among the Lenders;

(ix) amend this Section 8.3;

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and (b) any supplemental agreement amending or modifying any provision of the Syndicated Canadian Addendum only requires the written consent of the Canadian Borrower, the Required Syndicated Canadian Banks and the Global Administrative Agent.

No amendment of any provision of this Agreement relating to the Global Administrative Agent shall be effective without the written consent of the Global Administrative Agent. No amendment of any provision of this Agreement relative to the Global Swing Line Lender shall be effective without the written consent of the Global Swing Line Lender. The Global Administrative Agent may waive payment of the fee required under Section 13.3(B) without obtaining the consent of any of the Lenders or Borrowers.

If, in connection with any proposed amendment, waiver or consent requiring the consent of “the Lenders”, “each Lender” or “each Lender directly affected thereby,” the consent of the Required Lenders is obtained, but the consent of other necessary Lenders is not obtained (any such Lender whose consent is necessary but not obtained being referred to herein as a “Non-Consenting Lender”), then Harley may (at its sole cost and expense) elect to replace a Non-Consenting Lender as a Lender party to this Agreement; provided that, concurrently with such replacement, (i) another bank or other entity which is reasonably satisfactory to Harley and the Global Administrative Agent shall agree, as of such date, to purchase for cash the Loans and other Obligations due to the Non-Consenting Lender pursuant to an assignment and assumption and to become a Lender for all purposes under this Agreement and to assume all obligations of the Non-Consenting Lender to be terminated as of such date and to comply with the requirements of Section 13.3(A), and with Harley or such replacement Lender paying the $3,500 processing fee required in Section 13.3(B) and (ii) Harley shall pay to such Non-Consenting Lender in same day funds on the day of such replacement (1) all principal, interest, fees and other amounts then accrued but unpaid to such Non-Consenting Lender by any Borrower hereunder to and including the date of termination, including without limitation payments due to such Non-Consenting Lender under Sections 3.1, 3.2, 3.5 and 3.7, and (2) an amount, if any, equal to the payment which would have been due to such Lender on the day of such replacement under Section 3.4 had the Loans of such Non-Consenting Lender been prepaid on such date rather than sold to the replacement Lender.

8.4 Preservation of Rights. No delay or omission of the Lenders or the Global Administrative Agent to exercise any right under the Loan Documents shall impair such right or be construed to be a waiver of any Default or an acquiescence therein, and the making of a Loan notwithstanding the existence of a Default or the inability of any Borrower to satisfy the conditions precedent to such Loan shall not constitute any waiver or acquiescence. Any single or partial exercise of any such right shall not preclude other or further exercise thereof or the exercise of any other right, and no waiver, amendment or other variation of the terms, conditions or provisions of the Loan Documents whatsoever shall be valid unless in writing signed by the Lenders required pursuant to Section 8.3, and then only to the extent in such writing specifically set forth. All remedies contained in the Loan Documents or by law afforded shall be cumulative and all shall be available to the Global Administrative Agent and the Lenders until the Obligations have been paid in full.

ARTICLE IX GENERAL PROVISIONS

9.1 Survival of Representations. All representations and warranties of the relevant Companies contained in this Agreement shall survive delivery of any Notes and the making of the Loans herein contemplated.

9.2 Governmental Regulation. Anything contained in this Agreement to the contrary notwithstanding, no Lender shall be obligated to extend credit to any Borrower in violation of any limitation or prohibition provided by any applicable statute or regulation.

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9.3 Headings. Section headings in the Loan Documents are for convenience of reference only, and shall not govern the interpretation of any of the provisions of the Loan Documents.

9.4 Entire Agreement. The Loan Documents embody the entire agreement and understanding among the Companies, the Global Administrative Agent and the Lenders and supersede all prior agreements and understandings among the Companies, the Global Administrative Agent and the Lenders relating to the subject matter thereof.

9.5 Several Obligations; Benefits of this Agreement. The respective obligations of the Lenders hereunder are several and not joint and no Lender shall be the partner or agent of any other. The failure of any Lender to perform any of its obligations hereunder shall not relieve any other Lender from any of its obligations hereunder. This Agreement shall not be construed so as to confer any right or benefit upon any Person other than the parties to this Agreement and their respective successors and assigns.

9.6 Expenses; Indemnification.

(A) Expenses. The Borrowers shall reimburse the Global Administrative Agent, the Global Swing Line Lender and the Arrangers for any reasonable costs, internal charges and out-of-pocket expenses (including attorneys’ and paralegals’ fees and time charges of attorneys and paralegals for each such Person, which attorneys and paralegals may be employees of such Persons) paid or incurred by such Persons in connection with the preparation, negotiation, execution, delivery, syndication, distribution (including via the internet), review, amendment, modification, and administration of the Loan Documents. The Borrowers also agree to reimburse the Global Administrative Agent, the Global Swing Line Lender and the Lenders for any costs, internal charges and out-of-pocket expenses (including attorneys’ and paralegals’ fees and time charges of attorneys and paralegals for each such Person, which attorneys and paralegals may be employees of such Persons) paid or incurred by each such Person in connection with the collection of the Obligations and enforcement of the Loan Documents; provided that the Borrowers shall not be obligated to so reimburse for more than one primary law firm (and, in addition to such primary law firm, one local counsel engaged in each relevant jurisdiction by such primary law firm) as counsel for the Global Administrative Agent and more than one primary law firm (and, in addition to such primary law firm, one local counsel engaged in each relevant jurisdiction by such primary law firm) as counsel for the Lenders in connection with such collection or enforcement.

(B) Indemnity. Each of the Borrowers further agrees to defend, protect, indemnify, and hold harmless the Global Administrative Agent, the Global Swing Line Lender, the Arrangers, each and all of the Lenders, and each of their respective Affiliates, and each of such Person’s respective officers, directors, employees, attorneys and agents (including, without limitation, those retained in connection with the satisfaction or attempted satisfaction of any of the conditions set forth in Article IV) (collectively, the “Indemnitees”) from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses of any kind or nature whatsoever (including, without limitation, the fees and disbursements of counsel for such Indemnitees in connection with any investigative, administrative or judicial proceeding, whether or not such Indemnitees shall be designated a party thereto), imposed on, incurred by, or asserted against such Indemnitees in any manner relating to or arising out of:

(i) this Agreement, the other Loan Documents, or any act, event or transaction related or attendant thereto, the making of the Loans hereunder, the management of such Loans or the use or intended use of the proceeds of the Loans; or

(ii) any liabilities, obligations, responsibilities, losses, damages, personal injury, death, punitive damages, economic damages, consequential damages, treble damages, intentional,

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willful or wanton injury, damage or threat to the environment, natural resources or public health or welfare, costs and expenses (including, without limitation, attorney, expert and consulting fees and costs of investigation, feasibility or remedial action studies), fines, penalties and monetary sanctions, interest, direct or indirect, known or unknown, absolute or contingent, past, present or future relating to violation of any Environmental Law arising from or in connection with the past, present or future operations of the Companies, their Subsidiaries or any of their respective predecessors in interest, or, the past, present or future environmental, health or safety condition of any respective Property of the Companies or their Subsidiaries, the presence of asbestos-containing materials at any respective Property of the Companies or their Subsidiaries or the Release or threatened Release of any contaminant into the environment (collectively, the “Indemnified Matters”);

provided, however, no Borrower shall have any obligation to an Indemnitee hereunder with respect to Indemnified Matters to the extent caused solely by or resulting solely from the bad faith, willful misconduct or gross negligence of such Indemnitee or such Indemnitee’s material breach of its obligations under this Agreement, in each case as determined by the final non-appealable judgment of a court of competent jurisdiction. If the undertaking to indemnify, pay and hold harmless set forth in the preceding sentence may be unenforceable because it is violative of any law or public policy, the Borrowers shall contribute the maximum portion which it is permitted to pay and satisfy under applicable law, to the payment and satisfaction of all Indemnified Matters incurred by the Indemnitees.

(C) Waiver of Certain Claims; Settlement of Claims. Each of the Companies further agrees to assert no claim against any of the Indemnitees on any theory of liability for consequential, special, indirect, exemplary or punitive damages. No settlement shall be entered into by any Company or any of their Subsidiaries with respect to any claim, litigation, arbitration or other proceeding relating to or arising out of the transaction evidenced by this Agreement or the other Loan Documents (whether or not the Global Administrative Agent, any Lender, the Global Swing Line Lender or any Indemnitee is a party thereto) unless such settlement releases all Indemnitees from any and all liability with respect thereto.

(D) Survival of Agreements. The obligations and agreements of the Companies under this Section 9.6 shall survive the termination of this Agreement.

9.7 Numbers of Documents. All statements, notices, closing documents, and requests hereunder shall be furnished to the Global Administrative Agent with sufficient counterparts so that the Global Administrative Agent may furnish one to each of the relevant Lenders.

9.8 Accounting. Except as provided to the contrary herein, all accounting terms used herein shall be interpreted and all accounting determinations hereunder shall be made in accordance with Agreement Accounting Principles. Notwithstanding any other provision contained herein, all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made (i) without giving effect to any election under Accounting Standards Codification 825-10-25 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any Indebtedness or other liabilities of Harley or any Subsidiary of Harley at “fair value”, as defined therein and (ii) without giving effect to any treatment of Indebtedness in respect of convertible debt instruments under Accounting Standards Codification 470-20 (or any other Accounting Standards Codification or Financial Accounting Standard having a similar result or effect) to value any such Indebtedness in a reduced or bifurcated manner as described therein, and such Indebtedness shall at all times be valued at the full stated principal amount thereof. Notwithstanding any other provision of this Agreement to the contrary, the determination of whether a lease constitutes a capital lease or an operating lease, and whether obligations arising under a lease are required to be capitalized on the balance sheet of the lessee thereunder and/or recognized as interest expense, shall be determined by reference to Agreement Accounting Principles as in effect on the Closing Date.

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9.9 Severability of Provisions. Any provision in any Loan Document that is held to be inoperative, unenforceable, or invalid in any jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, or invalid without affecting the remaining provisions in that jurisdiction or the operation, enforceability, or validity of that provision in any other jurisdiction, and to this end the provisions of all Loan Documents are declared to be severable.

9.10 Nonliability of Lenders. The relationship among the Companies and the Lenders, the Global Swing Line Lender and the Global Administrative Agent shall be solely that of borrower or guarantor and lender. Neither the Global Administrative Agent, nor the Global Swing Line Lender nor any Lender shall have any fiduciary responsibilities to any of the Companies. Neither the Global Administrative Agent, nor any Lender, nor the Global Swing Line Lender undertakes any responsibility to any of the Companies to review or inform any of the Companies of any matter in connection with any phase of any of the Companies’ business or operations.

9.11 CHOICE OF LAW AND SUBMISSION TO JURISDICTION. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO BANKS. EACH COMPANY HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT THE GLOBAL ADMINISTRATIVE AGENT OR ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AGAINST ANY COMPANY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

9.12 WAIVER OF JURY TRIAL. EACH OF THE COMPANIES, THE GLOBAL ADMINISTRATIVE AGENT, THE GLOBAL SWING LINE LENDER AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER. EACH OF THE PARTIES HERETO AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

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9.13 No Strict Construction. The parties hereto have participated jointly in the negotiation and drafting of this Agreement and the other Loan Documents. In the event an ambiguity or question of intent or interpretation arises, this Agreement and the other Loan Documents shall be construed as if drafted jointly by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement or any of the other Loan Documents.

9.14 USA PATRIOT ACT. Each Lender that is subject to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”) hereby notifies each Borrower that pursuant to the requirements of the Act, it is required to obtain, verify and record information that identifies such Borrower, which information includes the name and address of such Borrower and other information that will allow such Lender to identify such Borrower in accordance with the Act.

9.15 Service of Process. Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Article XIV. Each Foreign Borrower irrevocably designates and appoints HDFS, as its authorized agent, to accept and acknowledge on its behalf, service of any and all process which may be served in any suit, action or proceeding of the nature referred to in Section 9.11 in any federal or New York State court sitting in New York County. HDFS hereby represents, warrants and confirms that HDFS has agreed to accept such appointment. Said designation and appointment shall be irrevocable by each Foreign Borrower until all Loans, all interest thereon and all other amounts payable by such Borrower hereunder and under the other Loan Documents shall have been paid in full in accordance with the provisions hereof and thereof. Each Foreign Borrower hereby consents to process being served in any suit, action or proceeding of the nature referred to in Section 9.11 in any federal or New York State court sitting in New York County by service of process upon HDFS as provided in this Section 9.15. Each Foreign Borrower irrevocably waives, to the fullest extent permitted by law, all claim of error by reason of any such service in such manner and agrees that such service shall be deemed in every respect effective service of process upon such Borrower in any such suit, action or proceeding and shall, to the fullest extent permitted by law, be taken and held to be valid and personal service upon and personal delivery to such Borrower. To the extent any Foreign Borrower has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether from service or notice, attachment prior to judgment, attachment in aid of execution of a judgment, execution or otherwise), such Borrower hereby irrevocably waives such immunity in respect of its obligations under the Loan Documents. Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

ARTICLE X THE GLOBAL ADMINISTRATIVE AGENT

10.1 Appointment; Nature of Relationship. JPMorgan Chase Bank, N.A. is appointed by the Lenders (each reference in this Article X to a Lender being in its capacity either as a Lender or the Global Swing Line Lender, or any or all of the foregoing) as the Global Administrative Agent hereunder and under each other Loan Document, and each of the Lenders irrevocably authorizes the Global Administrative Agent to act as the contractual representative of such Lender with the rights and duties expressly set forth herein and in the other Loan Documents. The Global Administrative Agent agrees to act as such contractual representative upon the express conditions contained in this Article X. Notwithstanding the use of the defined term “Global Administrative Agent”, it is expressly understood and agreed that the Global Administrative Agent shall not have any fiduciary responsibilities to any Lender by reason of this Agreement and that the Global Administrative Agent is merely acting as the representative of the Lenders with only those duties as are expressly set forth in this Agreement and the other Loan Documents. In its capacity as the Lenders’ contractual representative, the Global Administrative Agent (i) does not assume any fiduciary duties to any of the Lenders, and (ii) is acting as

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an independent contractor, the rights and duties of which are limited to those expressly set forth in this Agreement and the other Loan Documents. Each of the Lenders agrees to assert no claim against the Global Administrative Agent on any agency theory or any other theory of liability for breach of fiduciary duty, all of which claims each Lender waives.

10.2 Powers. The Global Administrative Agent shall have and may exercise such powers under the Loan Documents as are specifically delegated to the Global Administrative Agent by the terms of each thereof, together with such powers as are reasonably incidental thereto. The Global Administrative Agent shall have no implied duties or fiduciary duties to the Lenders, or any obligation to the Lenders to take any action hereunder or under any of the other Loan Documents except any action specifically provided by the Loan Documents required to be taken by the Global Administrative Agent. The Global Administrative Agent shall have and may exercise such powers under the Loan Documents as are specifically delegated to the Global Administrative Agent by the terms of each thereof, together with such powers as are reasonably incidental thereto. The Global Administrative Agent shall have no implied duties or fiduciary duties to the Lenders, or any obligation to the Lenders to take any action hereunder or under any of the other Loan Documents except any action specifically provided by the Loan Documents required to be taken by the Global Administrative Agent. Without limiting the foregoing, the Global Administrative Agent hereby agrees to provide the notice contemplated by Section 7.1(b) if so requested by the Required Lenders.

10.3 General Immunity. Neither the Global Administrative Agent nor any of its directors, officers, agents or employees shall be liable to any of the Borrowers or Lenders for any action taken or omitted to be taken by it or them hereunder or under any other Loan Document or in connection herewith or therewith except to the extent such action or inaction is found in a final non-appealable judgment by a court of competent jurisdiction to have arisen solely from (i) the gross negligence or willful misconduct of such Person or (ii) breach of contract by such Person with respect to the Loan Documents.

10.4 No Responsibility for Loans, Creditworthiness, Recitals, Etc. Neither the Global Administrative Agent nor any of its directors, officers, agents or employees shall be responsible for or have any duty to ascertain, inquire into, or verify (i) any statement, warranty or representation made in connection with any Loan Document or any borrowing hereunder; (ii) the performance or observance of any of the covenants or agreements of any obligor under any Loan Document; (iii) the satisfaction of any condition specified in Article IV (other than to confirm receipt of items expressly required to be delivered to the Global Administrative Agent on the Closing Date pursuant to Section 4.1); (iv) the existence or possible existence of any Default or (v) the validity, effectiveness or genuineness of any Loan Document or any other instrument or writing furnished in connection therewith. The Global Administrative Agent shall not be responsible to any Lender for any recitals, statements, representations or warranties herein or in any of the other Loan Documents, for the execution, effectiveness, genuineness, validity, legality, enforceability, collectibility, or sufficiency of this Agreement or any of the other Loan Documents or the transactions contemplated thereby, or for the financial condition of Harley, any guarantor of any or all of the Obligations, any Company or any of their Subsidiaries.

10.5 Action on Instructions of Lenders. The Global Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, hereunder and under any other Loan Document in accordance with written instructions signed by the Required Lenders (except with respect to actions that require the consent of all of the Lenders as provided in Section 8.3), and such instructions and any action taken or failure to act pursuant thereto shall be binding on all of the Lenders and on all holders of Notes. The Global Administrative Agent shall be fully justified in failing or refusing to take any action hereunder and under any other Loan Document unless it shall first be indemnified to its satisfaction by the Lenders pro rata against any and all liability, cost and expense that it may incur by reason of taking or continuing to take any such action.

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10.6 Employment of the Global Administrative Agent and Counsel. The Global Administrative Agent may execute any of its duties hereunder and under any other Loan Document by or through employees, agents, affiliates and attorneys-in-fact, and shall not be answerable to the Lenders, except as to money or securities received by it or its authorized agents, for the default or misconduct of any such agents or attorneys-in-fact selected by it with reasonable care. The Global Administrative Agent shall be entitled to advice of counsel concerning the contractual arrangement among the Global Administrative Agent and the Lenders and all matters pertaining to the Global Administrative Agent’s duties hereunder and under any other Loan Document.

10.7 Reliance on Documents; Counsel. The Global Administrative Agent shall be entitled to rely upon any Note, notice, consent, certificate, affidavit, letter, telegram, statement, paper or document believed by it to be genuine and correct and to have been signed or sent by the proper person or persons, and, in respect to legal matters, upon the opinion of counsel selected by the Global Administrative Agent, which counsel may be employees of the Global Administrative Agent.

10.8 The Global Administrative Agent’s Reimbursement and Indemnification. The Lenders agree to reimburse and indemnify the Global Administrative Agent ratably in proportion to their respective Pro Rata Shares (determined at the time such indemnity is sought) (i) for any amounts not reimbursed by any Borrower for which the Global Administrative Agent is entitled to reimbursement or indemnification by any Borrower under the Loan Documents, (ii) for any other expenses incurred by the Global Administrative Agent on behalf of the Lenders in connection with the preparation, execution, delivery, administration, distribution (including via the internet) and enforcement of the Loan Documents, including as a result of a dispute among the Lenders or between any Lender and the Global Administrative Agent, and (iii) for any liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever which may be imposed on, incurred by or asserted against the Global Administrative Agent in any way relating to or arising out of the Loan Documents or any other document delivered in connection therewith or the transactions contemplated thereby, or the enforcement of any of the terms thereof or of any such other documents, including as a result of a dispute among the Lenders or between any Lender and the Global Administrative Agent; provided that no Lender shall be liable for any of the foregoing to the extent any of the foregoing is found in a final non-appealable judgment by a court of competent jurisdiction to have arisen solely from the gross negligence or willful misconduct of the Global Administrative Agent.

10.9 Rights as a Lender. With respect to its Commitment, Swing Line Commitment or Syndicated Canadian Commitment, Loans made by it and any Notes issued to it, the Global Administrative Agent shall have the same rights and powers hereunder and under any other Loan Document as any Lender and may exercise the same as though it were not the Global Administrative Agent, as applicable, and the term “Lender” or “Lenders”, “Syndicated Canadian Bank” or “Global Swing Line Lender”, as applicable, shall, unless the context otherwise indicates, include the Global Administrative Agent in its individual capacity. The Global Administrative Agent may accept deposits from, lend money to and generally engage in any kind of trust, debt, equity or other transaction, in addition to those contemplated by this Agreement or any other Loan Document, with Harley, any Company or any of their Subsidiaries in which such Person is not prohibited hereby from engaging with any other Person.

10.10 Lender Credit Decision. Each Lender acknowledges that it has, independently and without reliance upon the Global Administrative Agent or any other Lender and based on the financial statements prepared by the Borrowers and such other documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement and the other Loan Documents. Each Lender also acknowledges that it will, independently and without reliance upon the Global Administrative Agent or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement and the other Loan Documents.

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10.11 Successor Global Administrative Agent. The Global Administrative Agent may resign at any time by giving written notice thereof to the Lenders and the Borrowers. Upon any such resignation, the Required Lenders shall have the right to appoint, on behalf of the Lenders, a successor Global Administrative Agent. If no successor Global Administrative Agent shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty days after the retiring Global Administrative Agent’s giving notice of resignation, then the retiring Global Administrative Agent may appoint, on behalf of the Lenders, a successor Global Administrative Agent. Notwithstanding anything herein to the contrary, so long as no Default has occurred and is continuing, each such successor Global Administrative Agent shall be subject to approval by Harley, which approval shall not be unreasonably withheld. Such successor Global Administrative Agent shall be a commercial bank (including a branch thereof) having capital and retained earnings of at least $500,000,000. Upon the acceptance of any appointment as the Global Administrative Agent hereunder by a successor Global Administrative Agent, such successor Global Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Global Administrative Agent, and the retiring Global Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents. After any retiring Global Administrative Agent’s resignation hereunder as the Global Administrative Agent, the provisions of this Article X shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Global Administrative Agent hereunder and under the other Loan Documents.

10.12 Co-Agents, Documentation Agent, Syndication Agent, etc. None of the Lenders, if any, identified in this Agreement as a “co-agent”, “documentation agent” or “syndication agent” shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than those applicable to all Lenders as such. Without limiting the foregoing, none of such Lenders shall have or be deemed to have a fiduciary relationship with any Lender. Each Lender hereby makes the same acknowledgments with respect to such Lenders as it makes with respect to the Global Administrative Agent in Section 10.10.

ARTICLE XI SETOFF; RATABLE PAYMENTS

11.1 Setoff. In addition to, and without limitation of, any rights of the Lenders or the Global Swing Line Lender under applicable law, if any Default occurs and is continuing, any indebtedness from any Lender or the Global Swing Line Lender to any Company (including all account balances, whether provisional or final and whether or not collected or available) may be offset and applied toward the payment of the Obligations owing to such Lender or the Global Swing Line Lender and the other Obligations, whether or not the Obligations, or any part hereof, shall then be due.

11.2 Ratable Payments. (a) If any Syndicated Global Lender, whether by setoff or otherwise, has payment made to it upon its Syndicated Global Loans (other than payments received pursuant to Sections 3.1, 3.2, 3.4 or 3.5) in a greater proportion than that received by any other Syndicated Global Lender, such Syndicated Global Lender agrees, promptly upon demand, to purchase a portion of the Syndicated Global Loans held by the other Syndicated Global Lenders so that after such purchase each Syndicated Global Lender will hold its ratable proportion of Syndicated Global Loans. If any Syndicated Global Lender, whether in connection with setoff or amounts which might be subject to setoff or otherwise, receives collateral or other protection for its Obligations or such amounts which may be subject to setoff, such Syndicated Global Lender agrees, promptly upon demand, to take such action necessary such that all Syndicated Global Lenders share in the benefits of such collateral ratably in proportion to their Syndicated Global Loans. In case any such payment is disturbed by legal process, or otherwise, appropriate further adjustments shall be made.

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(b) If any Syndicated Canadian Bank, whether by setoff or otherwise, has payment made to it upon its Syndicated Canadian Loans (other than payments received pursuant to Sections 3.1, 3.2, 3.4 or 3.5) in a greater proportion than that received by any other Syndicated Canadian Bank, such Syndicated Canadian Bank agrees, promptly upon demand, to purchase a portion of the Syndicated Canadian Loans held by the other Syndicated Canadian Banks so that after such purchase each Syndicated Canadian Bank will hold its ratable proportion of Syndicated Canadian Loans. If any Syndicated Canadian Bank, whether in connection with setoff or amounts which might be subject to setoff or otherwise, receives collateral or other protection for its Obligations or such amounts which may be subject to setoff, such Syndicated Canadian Bank agrees, promptly upon demand, to take such action necessary such that all Syndicated Canadian Banks share in the benefits of such collateral ratably in proportion to their Syndicated Canadian Loans. In case any such payment is disturbed by legal process, or otherwise, appropriate further adjustments shall be made.

ARTICLE XII GUARANTEE

In order to induce the Lenders to extend credit hereunder, but subject to the provisions of the final paragraph of this Article XII, each Guarantor fully and unconditionally and irrevocably guarantees, as a primary obligor and not merely as a surety, jointly with the other Guarantors and severally, the Obligations (including, without limitation, interest accruing hereunder after the commencement of any case under the United States Bankruptcy Code or any other bankruptcy-related rules or legislation in any country in which a Company is organized, whether or not allowed as a claim in such case). The obligations of the Guarantors under this Article XII are sometimes referred to as the “Guarantee”. Each Guarantor further agrees that the Obligations may be extended or renewed, in whole or in part, without notice to or further assent from it, and that it will remain bound upon its Guarantee hereunder notwithstanding any such extension or renewal of any Obligation.

Each Guarantor waives presentment to, demand of payment from and protest to any Borrower of any of the Obligations, and also waives notice of acceptance of its obligations and notice of protest for nonpayment. The obligations of the Guarantors hereunder shall not be affected by the failure of any Lender or the Global Administrative Agent to assert any claim or demand or to enforce any right or remedy against any Borrower under the provisions of this Agreement or any of the other Loan Documents or otherwise, or, except as specifically provided therein, by any rescission, waiver, amendment or modification of any of the terms or provisions of this Agreement, any of the other Loan Documents or any other agreement.

Each Guarantor further agrees that its Guarantee hereunder constitutes a promise of payment when due and not merely of collection, and waives any right to require that any resort be had by any Lender to any balance of any deposit account or credit on the books of any Lender in favor of any Borrower or any other person.

Each Guarantor agrees that its obligations under this Guarantee shall be unconditional, irrespective of:

(i) the validity, enforceability, avoidance, novation or subordination of any of the Obligations or any of the Loan Documents;

(ii) the absence of any attempt by, or on behalf of, any Lender or the Global Administrative Agent to collect, or to take any other action to enforce, all or any part of the Obligations whether from or against any Borrower, any other guarantor of the Obligations or any other Person;

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(iii) the election of any remedy by, or on behalf of, any Lender or the Global Administrative Agent with respect to all or any part of the Obligations;

(iv) the waiver, consent, extension, forbearance or granting of any indulgence by, or on behalf of, any Lender or the Global Administrative Agent with respect to any provision of any of the Loan Documents;

(v) the failure of the Global Administrative Agent to take any steps to perfect and maintain its security interest in, or to preserve its rights to, any security or collateral for the Obligations;

(vi) the election by, or on behalf of, any one or more of the Lenders or the Global Administrative Agent in any proceeding instituted under Chapter 11 of Title 11 of the United States Code (11 U.S.C. 101 et seq.) (the “Bankruptcy Code”) or other bankruptcy-related rules or legislation in any country in which a Company is organized, of the application of Section 1111(b)(2) of the Bankruptcy Code;

(vii) any borrowing or grant of a security interest by any Company, as debtor-in-possession, under Section 364 of the Bankruptcy Code or any other bankruptcy-related rules or regulations in any country in which a Borrower is organized;

(viii) the disallowance, under Section 502 of the Bankruptcy Code or any other bankruptcy-related rules or regulations in any country in which a Company is organized, of all or any portion of the claims of any of the Lenders or the Global Administrative Agent for repayment of all or any part of the Obligations; or

(ix) any other circumstance which might otherwise constitute a legal or equitable discharge or defense of any Borrower or any Guarantor.

The obligations of the Guarantors hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, and shall not be subject to any defense or setoff, counterclaim, recoupment or termination whatsoever, by reason of the invalidity, illegality or unenforceability of the Obligations, any impossibility in the performance of the Obligations or otherwise. The Lenders, either themselves or acting through the Global Administrative Agent, are authorized, without notice or demand and without affecting the liability of any Guarantor hereunder, from time to time, (a) to renew, extend, accelerate or otherwise change the time for payment of, or other terms relating to, all or any part of the Obligations, or to otherwise modify, amend or change the terms of any of the Loan Documents; (b) to accept partial payments on all or any part of the Obligations; (c) to take and hold security or collateral for the payment of all or any part of the Obligations, this Guarantee, or any other guaranties of all or any part of the Obligations, (d) to exchange, enforce, waive and release any such security or collateral; (e) to apply such security or collateral and direct the order or manner of sale thereof as in their discretion they may determine; (f) to settle, release, exchange, enforce, waive, compromise or collect or otherwise liquidate all or any part of the Obligations, this Guarantee, any other guaranty of all or any part of the Obligations, and any security or collateral for the Obligations or for any such guaranty.

The Guarantors consent and agree that none of the Lenders nor the Global Administrative Agent nor any Person acting for or on behalf of the Lenders or the Global Administrative Agent shall be under any obligation to marshall any assets in favor of any Guarantor or against or in payment of any or all of

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the Obligations. The Guarantors further agree that, to the extent that any Borrower, any Guarantor or any other guarantor of all or any part of the Obligations makes a payment or payments to any Lender or the Global Administrative Agent, or any Lender or the Global Administrative Agent receives any proceeds of collateral for all or any part of the Obligations, which payment or payments or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to any Borrower, such Guarantor, such other guarantor or any other Person, or their respective estates, trustees, receivers or any other party, under any bankruptcy law, state, provincial or federal law, common law or equitable cause, then, to the extent of such payment or repayment, the part of the Obligations which has been paid, reduced or satisfied by such amount shall be reinstated and continued in full force and effect as of the time immediately preceding such initial payment, reduction or satisfaction.

In furtherance of the foregoing and not in limitation of any other right which the Global Administrative Agent or any Lender may have at law or in equity against the Guarantors by virtue hereof, upon the failure of any Borrower to pay any of the Obligations when and as the same shall become due, whether at maturity, by acceleration, after notice of prepayment or otherwise, each Guarantor promises to and will, upon receipt of written demand by the Global Administrative Agent, forthwith pay, or cause to be paid, in cash, the amount of such unpaid Obligations. The Guarantors further agree, jointly and severally, that if payment in respect of any of the Obligations owed to any Lender shall be due in a currency other than Dollars and/or at a place of payment other than as designated in this Agreement or the Syndicated Canadian Addendum and if, by reason of any Change in Law (as defined in Section 3.1), disruption of currency or foreign exchange markets, war or civil disturbance or other event, payment of such Obligations in such currency or such place of payment shall be impossible or, in the judgment of such Lender, not consistent with the protection of its rights or interests, then, at the election of such Lender, the Guarantors shall make payment of such Obligation in Dollars (based upon the applicable Exchange Rate in effect on the date of payment) and/or in the applicable place designated in this Agreement or the Syndicated Canadian Addendum, and shall indemnify such Lender against any losses or expenses that it shall sustain as a result of such alternative payment.

Until the Obligations have been paid in full in cash and the Termination Date shall have occurred, the Guarantors (i) shall have no right of subrogation with respect to such Obligations and (ii) waive any right to enforce any remedy which the Lenders or the Global Administrative Agent (or any of them) now have or may hereafter have against any Borrower, any endorser or any guarantor of all or any part of the Obligations or any other Person, and the Guarantors waive any benefit of, and any right to participate in, any security or collateral given to the Lenders and the Global Administrative Agent (or any of them) to secure the payment or performance of all or any part of the Obligations or any other liability of any Borrower to the Lenders or the Global Administrative Agent (or any of them).

This Guarantee shall continue in full force and effect and may not be terminated or otherwise revoked until the Obligations shall have been fully paid (in cash) and discharged and this Agreement and all financing arrangements between any Borrower, the Global Administrative Agent and the Lenders shall have been terminated; provided that if a Guarantor is merged or consolidated with another Company pursuant to Section 6.2.3 or if the capital stock of a Guarantor is sold, transferred or otherwise disposed of in a transaction permitted pursuant to the terms of this Agreement (as in effect on the Closing Date), such Guarantor shall be released from its obligations under this Agreement without further action. If, notwithstanding the foregoing, the Guarantors (or any of them) shall have any right under applicable law to terminate or revoke this Guarantee, the Guarantors agree that such termination or revocation shall not be effective until a written notice of such revocation or termination, specifically referring hereto, signed by the Guarantors, is actually received by the Global Administrative Agent. Such notice shall not affect the right and power of any of the Lenders or the Global Administrative Agent to enforce rights arising prior to receipt thereof by the Global Administrative Agent. If any Lender grants loans or takes other action after a Guarantor terminates or revokes this Guarantee but before the Global Administrative Agent

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receives such written notice, the rights of such Lender with respect thereto shall be the same as if such termination or revocation had not occurred. The provisions of this Article XII shall remain in full force and effect, notwithstanding any termination of this Agreement, until the Obligations shall have been fully paid (in cash) and discharged.

Notwithstanding anything contained in this Article XII to the contrary, (i) the obligations of HDFC under this Article XII shall be solely in respect of the Loans made to, and any other Obligations of, HDFS and the Canadian Borrower, (ii) the obligations of HDFS under this Article XII shall be solely in respect of the Loans made to, and any other Obligations of, HDFC and the Canadian Borrower, (iii) the obligations of the Finco Guarantors under this Article XII shall be solely in respect of the Loans made to, and any other Obligations of, HDFC, HDFS and the Canadian Borrower and (iv) no Guarantor shall have any obligations under this Article XII in respect of the Loans made to, or any other Obligations of, Harley.

ARTICLE XIII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS

13.1 Successors and Assigns. The terms and provisions of the Loan Documents shall be binding upon and inure to the benefit of the Companies, the Lenders and the Global Administrative Agent and their respective successors and assigns, except that (i) the Companies shall not have the right to assign their rights or obligations under the Loan Documents and (ii) any assignment by any Lender must be made in compliance with Section 13.3 hereof. Notwithstanding clause (ii) of this Section 13.1, any Lender may at any time, without the consent of any Borrower or the Global Administrative Agent, assign all or any portion of its rights under this Agreement and any Notes to a Federal Reserve Bank or other central banking authority with authority over such Lender; provided, however, that no such assignment shall release the transferor Lender from its obligations hereunder. The Global Administrative Agent may treat any Lender as the owner of the Loans for all purposes hereof unless and until such Lender complies with Section 13.3 hereof in the case of an assignment thereof or, in the case of any other transfer, a written notice of the transfer is filed with the Global Administrative Agent. Any such assignee or transferee agrees by acceptance thereof to be bound by all the terms and provisions of the Loan Documents. Any request, authority or consent of any Person, who at the time of making such request or giving such authority or consent is the holder of any Loan, shall be conclusive and binding on any subsequent holder, transferee or assignee of such Loan.

13.2 Participations.

(A) Permitted Participants; Effect. Subject to the terms set forth in this Section 13.2, any Lender may, in the ordinary course of its business and in accordance with applicable law, at any time sell to one or more banks or other entities (“Participants”) participating interests in any Loan owing to such Lender, any Commitment or Syndicated Canadian Commitment of such Lender or any other interest of such Lender under the Loan Documents. In the event of any such sale by a Lender of participating interests to a Participant, such Lender’s obligations under the Loan Documents shall remain unchanged, such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, such Lender shall remain the owner of all Loans for all purposes under the Loan Documents, all amounts payable by any Borrower under this Agreement shall be determined as if such Lender had not sold such participating interests, and such Borrower and the Global Administrative Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under the Loan Documents except that, for purposes of Article III hereof, the Participants shall be entitled to the same rights as if they were Lenders provided however that no Participant shall be entitled to receive any greater payment under Article III than the Lender would have been entitled to receive with respect to the rights participated.

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(B) Voting Rights. Each Lender shall retain the sole right to approve, without the consent of any Participant, any amendment, modification or waiver of any provision of the Loan Documents, other than any amendment, modification or waiver with respect to any Loan or Commitment or Syndicated Canadian Commitment in which such Participant has an interest which involves an amendment, modification or waiver with respect to a matter which, if such Participant were a Lender hereunder, would require the consent of such Lender under clauses (i) through (viii) of Section 8.3 hereof.

(C) Benefit of Setoff. The Companies agree that each Participant shall be deemed to have the right of setoff provided in Section 11.1 hereof in respect to its participating interest in amounts owing under the Loan Documents to the same extent as if the amount of its participating interest were owing directly to it as a Lender under the Loan Documents; provided that each Lender shall retain the right of setoff provided in Section 11.1 hereof with respect to the amount of participating interests sold to each Participant except to the extent such Participant exercises its right of set off. The Lenders agree to share with each Participant, and each Participant, by exercising the right of setoff provided in Section 11.1 hereof, agrees to share with each Lender, any amount received pursuant to the exercise of its right of setoff, such amounts to be shared in accordance with Section 11.2 as if each Participant were a Lender.

(D) Participant Register. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrowers, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in any Loan, Commitment, Syndicated Canadian Commitment or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any Loan, Commitment, Syndicated Canadian Commitment or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such Loan, Commitment, Syndicated Canadian Commitment or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Global Administrative Agent (in its capacity as Global Administrative Agent) shall have no responsibility for maintaining a Participant Register.

13.3 Assignments.

(A) Permitted Assignments. Any Lender may, in the ordinary course of its business and in accordance with applicable law, at any time assign to one or more banks or other entities which is not (i) a competitor of any of the Companies or (ii) a Person that is, or is owned or controlled by, a participant in the transportation industry (“Purchasers”) all or a portion of its rights and obligations under this Agreement (including, without limitation, its Commitment, Syndicated Canadian Commitment, Swing Line Commitment, all Loans owing to it, all of its participation interests in Syndicated Canadian Loans and Swing Line Loans, and its obligation to participate in additional Syndicated Canadian Loans and Swing Line Loans hereunder) in accordance with the provisions of this Section 13.3. Each assignment shall be of a constant, and not a varying, ratable percentage of all of the rights and obligations of any assigning Lender under this Agreement. Such assignment shall be substantially in the form of Exhibit C hereto and shall not be permitted hereunder unless such assignment is either for all of such Lender’s rights and obligations under the Loan Documents or, except for assignments to another Lender, an Affiliate thereof or an Approved Fund, involves loans and commitments in an aggregate amount of at least $5,000,000. Notice to the Global Administrative Agent shall be required prior to any assignment becoming effective and the consent of the Global Administrative Agent (which consent will not be unreasonably withheld or delayed) shall be required prior to any assignment becoming effective with

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respect to a Purchaser which is not a Lender and, so long as no Default shall have occurred and be continuing, notice to and consent of Harley (which consent will not be unreasonably withheld or delayed) shall be required prior to an assignment becoming effective with respect to a Purchaser which is not a Lender, an Affiliate thereof or an Approved Fund (provided that Harley shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Global Administrative Agent within ten (10) Business Days after having received written notice thereof from the Global Administrative Agent).

(B) Effect; Effective Date. Upon (i) delivery to the Global Administrative Agent of a notice of assignment, substantially in the form attached as Appendix I to Exhibit C hereto (a “Notice of Assignment”), together with any consents required by Section 13.3(A) hereof, and (ii) payment of a $3,500 fee to the Global Administrative Agent for processing such assignment, such assignment shall become effective on the effective date specified in such Notice of Assignment. The Notice of Assignment shall contain a representation by the Purchaser to the effect that none of the consideration used to make the purchase of the Commitment and Loans under the applicable assignment agreement are “plan assets” as defined under ERISA and that the rights and interests of the Purchaser in and under the Loan Documents will not be “plan assets” under ERISA. On and after the effective date of such assignment, such Purchaser, if not already a Lender, shall for all purposes be a Lender party to this Agreement and any other Loan Documents executed by the Lenders and shall have all the rights and obligations of a Lender under the Loan Documents, to the same extent as if it were an original party hereto, and no consent or action by any of the Borrowers or the Lenders and no further consent or action by the Global Administrative Agent shall be required to release the transferor Lender with respect to the percentage of the Aggregate Commitment, Loans and the Syndicated Canadian Loan participations and Swing Line Loan participations assigned to such Purchaser. Upon the consummation of any assignment to a Purchaser pursuant to this Section 13.3(B), the transferor Lender, the Global Administrative Agent and Harley shall, if requested by such transferor Lender or Purchaser, make appropriate arrangements so that replacement Notes are issued to such transferor Lender and new Notes or, as appropriate, replacement Notes, are issued to such Purchaser.

(C) The Register. The Global Administrative Agent shall maintain at its address referred to in Section 14.1 a copy of each assignment delivered to and accepted by it pursuant to this Section 13.3 and a register (the “Register”) for the recordation of the names and addresses of the Lenders and the Commitment of and principal amount of the Loans owing to, each Lender from time to time and whether such Lender is an original Lender or the assignee of another Lender pursuant to an assignment under this Section 13.3. The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and each Borrower and each of its Subsidiaries, the Global Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by any Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice.

(D) Assignments to Borrowers. Notwithstanding anything in this Agreement to the contrary, no Lender may assign, or sell a participation in, any interest in any Loan held by it hereunder to any Borrower or any of such Borrower’s respective Affiliates or Subsidiaries without the prior consent of each Lender.

13.4 Confidentiality. (i) Subject to Section 13.5, the Global Administrative Agent and the Lenders shall hold confidential (A) all nonpublic information obtained pursuant to the requirements of this Agreement and (B) except as otherwise permitted by Harley, all information related to the Licensed Marks (as defined in Section 13.6)) and all other information which a reasonable person would deem to be confidential and/or proprietary in light of the nature of the information and the manner in which it was disclosed; provided that the Global Administrative Agent and the Lenders may each make disclosure (1)

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to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such information and instructed to keep such information confidential and the Global Administrative Agent and each Lender, as applicable, shall be responsible for breach by its respective affiliated Persons to which the Global Administrative Agent or such Lender made such disclosure), (2) to the extent requested by any regulatory authority, (3) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (4) to any other party to this Agreement, (5) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (6) subject to a written agreement containing provisions substantially the same as those of this Section, to (a) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (b) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to any Borrower and its obligations, (7) with the prior written consent of Harley, (8) to the extent such information (a) becomes publicly available other than as a result of a breach of this Section or (b) becomes available to the Global Administrative Agent or any Lender on a nonconfidential basis from a source other than the Companies, (9) to any rating agency when required by it, provided that, prior to any disclosure, such rating agency shall undertake in writing to preserve the confidentiality of any such information relating to the Companies received by it from the Global Administrative Agent or any Lender or (10) on a confidential basis to the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the Loans. In no event shall the Global Administrative Agent or any Lender be obligated or required to return any materials furnished by Harley, the Companies or any of their Subsidiaries; provided, however, each prospective Transferee shall be required to agree that if it does not become a participant or assignee it shall return all materials furnished to it by or on behalf of Harley or any Company in connection with this Agreement.

(ii) (A) To the extent that the Gramm-Leach-Bliley Act, Title V/Privacy (collectively with the related implementing regulations, the “GLBA”), shall be applicable to the transactions contemplated herein, each of the parties hereto agrees that (1) it shall use all non-public personal information obtained pursuant to the requirements of this Agreement solely for the purposes for which the information is disclosed or as otherwise permitted in conformance with the requirements of the GLBA and (2) it shall maintain the confidentiality of such information to the same extent as described in Section 13.4(i). This clause shall survive the termination of this Agreement.

(B) In the event that the Global Administrative Agent or any Lender reasonably believes that any physical and/or electronic safeguards have been breached, and that non-public personal information has been obtained by persons and/or entities without authority to use or view such non-public personal information, the Global Administrative Agent or such Lender, as applicable, will notify HDFS and Harley, in writing, as soon as reasonably practicable. The Global Administrative Agent and each Lender shall also maintain commercially reasonable processes and procedures for the storage, retention, and disposal of documents and storage media containing nonpublic personal information. Nothing in this clause shall be construed to create any third-party beneficiary rights in any consumer or other holder of nonpublic personal information. This clause shall survive the termination of this Agreement.

(iii) Each of the parties hereto acknowledges that any breach of the aforesaid confidentiality obligations in this Section 13.4 is likely to cause or threaten irreparable harm to HDFS and Harley. Therefore, HDFS and Harley shall be entitled to seek equitable relief to protect its interests, including but not limited to preliminary and permanent injunctive relief, as well as monetary damages. Nothing stated herein will be construed to limit any other remedies available to the parties hereto. This section shall survive the termination of this Agreement.

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13.5 Dissemination of Information. Each of the Companies authorizes each Lender to disclose to any Participant or Purchaser or any other Person acquiring an interest in the Loan Documents by operation of law (each a “Transferee”) and any prospective Transferee any and all information in such Lender’s possession concerning the Companies and their Subsidiaries; provided that prior to any such disclosure, such prospective Transferee shall agree in writing to preserve in accordance with Section 13.4 the confidentiality of any non-public information described therein.

13.6 Non-Use of HDFS’ Licensed Marks. (i) HDFS, Harley and their affiliates have the right pursuant to licenses or otherwise to use certain trademark(s), logo(s), etc. relating to Harley-Davidson Motorcycles, HDFS and their affiliates (the “Licensed Marks”). Except as permitted by the following sentences, none of the Global Administrative Agent, the Lenders or their Affiliates are authorized to use such Licensed Marks or Harley’s or HDFS’s (i) text name and logo(s) (together) and/or (ii) logo(s) on forms, in legal documents, in advertising, marketing materials, in press releases or any other document or material. In the event the Global Administrative Agent, any Lender or any of their Affiliates wish to use said Licensed Marks, such Person must obtain HDFS’s and Harley’s prior written approval, which said approval is at HDFS’s and Harley’s sole and absolute discretion and subject to subsequent periodic review of such use and to such reasonable specifications of HDFS and Harley to the extent such specifications are directly related to the legal maintenance, whether such is before or after lapse or termination of this Agreement. The Harley-Davidson and/or HDFS (i) text name, logo(s) and registered trademark(s) (together) and/or (ii) logo(s) and/or (iii) registered trademark(s) are not to be used by the Global Administrative Agent, any Lender or any of their Affiliates in any way before, during or after the term of this Agreement, unless prior written consent is obtained from HDFS and Harley. This section shall survive the termination of this Agreement.

(ii) Each of the parties hereto acknowledges that any breach of the aforestated non-use obligations in this Section 13.6 is likely to cause or threaten irreparable harm to HDFS and Harley. Therefore, in the event of any such breach, HDFS and Harley shall be entitled to seek equitable relief to protect its interests, including but not limited to preliminary and permanent injunctive relief, as well as monetary damages. Nothing stated in this Section 13.6 shall be construed to limit any other remedies available to any party hereto.

ARTICLE XIV NOTICES

14.1 Giving Notice. Except as otherwise permitted by Article II with respect to Borrowing Notices and Section 6.1.9, all notices and other communications provided to any party hereto under this Agreement or any other Loan Documents shall be in writing or by telex or by facsimile and addressed or delivered to such party at its address set forth below its signature hereto or at such other address as may be designated by such party in a notice to the other parties. Any notice, if mailed and properly addressed with postage prepaid, shall be deemed given when received; any notice, if transmitted by telex or facsimile, shall be deemed given when transmitted (answerback confirmed in the case of telexes); or, if by courier, one (1) Business Day after deposit with a reputable overnight carrier service; with all charges paid. Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communications pursuant to procedures approved by the Global Administrative Agent; provided that the foregoing shall not apply to notices pursuant to Article II unless otherwise agreed by the Global Administrative Agent and the applicable Lender. The Global Administrative Agent or the Companies may, in their respective discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.

14.2 Change of Address. Any of the Companies, the Global Administrative Agent, the Global Swing Line Lender and any Lender may each change the address for service of notice upon it by a notice in writing to the other parties hereto (or, in the case of any Lender, by notice in writing to Harley and the Global Administrative Agent).

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ARTICLE XV COUNTERPARTS

15.1 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one agreement, and any of the parties hereto may execute this Agreement by signing any such counterpart.

[Remainder of This Page Intentionally Blank]

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IN WITNESS WHEREOF, the Companies, the Lenders and the Global Administrative Agent have executed this Agreement as of the date first above written.

HARLEY-DAVIDSON, INC.,
as a U.S. Borrower
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President and Treasurer
Address:
Harley-Davidson, Inc.
3700 West Juneau Avenue
Milwaukee, Wisconsin 53208
Attention: J. Darrell Thomas, Vice-President and Treasurer
Telephone No.: (414) 343-7863
Facsimile No.: (414) 343-4990
with copy to (in the case of a notice of Default):
Harley-Davidson, Inc.
3700 West Juneau Avenue
Milwaukee, Wisconsin 53208
Attention: Paul J. Jones, Vice-President, General
Counsel and Secretary
Telephone No.: (414) 343-4885
Facsimile No.: (414) 343-4990

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

HARLEY-DAVIDSON FUNDING CORP.,
as a U.S. Borrower and as a Guarantor
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President, Treasurer and Assistant Secretary
Address: 3700 West Juneau Avenue Milwaukee, Wisconsin 53208 Attention: J. Darrell Thomas, Vice-President, Treasurer and Assistant Secretary Telephone No.: (414) 343-7863 Facsimile No.: (414) 343-4990

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

HARLEY-DAVIDSON FINANCIAL SERVICES, INC.,
as a U.S. Borrower and as a Guarantor
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President and Treasurer
Address: 3700 West Juneau Avenue Milwaukee, Wisconsin 53208 Attention: J. Darrell Thomas, Vice-President and Treasurer Telephone No.: (414) 343-7863 Facsimile No.: (414) 343-4990

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

HARLEY-DAVIDSON FINANCIAL SERVICES CANADA, INC.,
as the Canadian Borrower
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President and Treasurer
Address: 3700 West Juneau Avenue Milwaukee, Wisconsin 53208 Attention: J. Darrell Thomas, [                    ] Telephone No.: (414) 343-7863 Facsimile No.: (414) 343-4990

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

HARLEY-DAVIDSON FINANCIAL SERVICES INTERNATIONAL, INC.,
as a Guarantor
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President, Treasurer and Assistant Secretary

Address:

3700 West Juneau Avenue

Milwaukee, Wisconsin 53208

Attention: J. Darrell Thomas, Vice President, Treasurer and Assistant Secretary

Telephone No.: (414) 343-7863

Facsimile No.: (414) 343-4990

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

HARLEY-DAVIDSON CREDIT CORP.,
as a Guarantor
By:	/s/ J. Darrell Thomas
Name:	J. Darrell Thomas
Title:	Vice President, Treasurer and Assistant Secretary

Address:

3700 West Juneau Avenue

Milwaukee, Wisconsin 53208

Attention: J. Darrell Thomas, Vice-President, Treasurer and Assistant Secretary

Telephone No.: (414) 343-7863

Facsimile No.: (414) 343-4990

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

JPMORGAN CHASE BANK, N.A.,
as the Global Administrative Agent, the Global Swing Line Lender and as a Lender
By:	/s/ Richard W. Duker
Name:	Richard W. Duker
Title:	Managing Director

JPMorgan Chase Bank, N.A.

383 Madison Avenue

New York. NY 10179

Telephone No.: 212-270-3057

Facsimile No,: 212-270-5100

In the case of Borrowing Notices for Advances in LJ ,8, Dollars:

JPMorgan Chase Bank N.A.

1111 Fannin Street Floor 10

Houston, TX 77002-6925

Attention: Cynthia Freeman

Telephone No.: 713-750-2353

Facsilnile No,: 713-750-2892

In the case of Borrowing Notices for Advances in

Pounds Sterling, euros and Swiss Francs:

J.P. Morgan Europe Limited

125 London Wall

London EC2Y 5AJ

Attention: Manager Loans and Agency.

Facsimile No.: +44-207-777-2360

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

CITIBANK, N.A.,
as Syndication Agent and as a Lender
By:	/s/ Maureen Maroney
Name:	Maureen Maroney
Title:	Vice President

Address:

388 Greenwich Street, 34^th Floor

New York, NY, 10013

Attention: Christopher Hartzell

Telephone No.: (212) 816-5391

Facsimile No.: (646) 291-1806

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

U.S. BANK NATIONAL ASSOCIATION,
as a Documentation Agent and as a Lender
By:	/s/ Jerrod Clements
Name:	Jerroid Clements
Title:	Officer

Address:

777 E. Wisconsin Ave.

Milwaukee, WI 53202

Attention: Jerroid Clements

Telephone No.: 414-765-5289

Facsimile No.: 414-765-4632

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

THE ROYAL BANK OF SCOTLAND plc,
as a Documentation Agent and as a Lender
By:	/s/ James Welch
Name:	James Welch
Title:	Director
Address: 600 Washington Boulevard Stamford, CT 06901 Attention: Richard VanOrden Telephone No.: (801) 312-6236 Facsimile No.: (203) 873-5019

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

BMO HARRIS BANK N.A.,
as a Lender
By:	/s/ Ronald J. Carey
Name:	Ronald J. Carey
Title:	Senior Vice President
By:	/s/ Leo D. Freeman
Name:	Leo D. Freeman
Title:	Senior Vice President
Address: 770 North Water Street Milwaukee, WI 53202 Attention: Ronald J. Carey Telephone No.: 414/765-7439 Facsimile No.: 414/765-7670

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

MIZUHO CORPORATE BANK, LTD., NEW YORK BRANCH, as a Lender
By:	/s/ Yasuo Imaizumi
Name:	Yasuo Imaizumi
Title:	Deputy General Manager
Address: 1251 Avenue of the Americas New York, NY 10020 Attention: David Fraenkel Telephone No.: 212-282-3912 Facsimile No.: 212-282-4486

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

THE BANK OF NEW YORK MELLON,
as a Lender
By:	/s/ Jeffrey Dears
Name:	Jeffrey Dears
Title:	Vice President
Address: BNY Mellon Center 500 Grant St, RM 3600 Pittsburgh, PA 15258 Attention: Jeffrey Dears Telephone No.: 412-234-8374 Facsimile No.: 412-236-1914

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.,
as a Lender
By:	/s/ Victor Pierzchalski
Name:	Victor Pierzchalski
Title:	Authorized Signatory
Address: 1251 Avenue of the Americas New York, NY 10020-1104 Attention: US Corporate Banking                  Christina Schuschel Telephone No.: 312-696-4663 Facsimile No.: 312-696-4535 with a                         Copy to 312-696-4535

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

WELLS FARGO BANK, NATIONAL ASSOCIATION,
as a Lender
By:	/s/ John Brady
Name:	John Brady
Title:	Director
Address: 230 W. Monroe St. Suite 2900 Chicago, IL 60606 Telephone No.: 704.715.5550 Facsimile No.: 312.795.9388

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

FIFTH THIRD BANK,
as a Lender
By:	/s/ William M. Thurman
Name:	William M. Thurman
Title:	Senior Vice President
Address: Attention: Telephone No.: Facsimile No.:

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

GOLDMAN SACHS BANK USA,
as a Lender
By:	/s/ Mark Walton
Name:	Mark Walton
Title:	Authorized Signatory
Goldman Sachs Bank USA 200 West Street New York, NY 10282 Attention: gsd.link@gs.com Telephone No.: 212-902-1099 Facsimile No.: 917-977-3966

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

TORONTO DOMINION BANK (NEW YORK) LLC,
as a Lender
By:	/s/ Kelly Hundal
Name:	Kelly Hundal
Title:	Authorized Signatory
Address: 31 West 52nd Street, 17th Floor New York, NY 10019 Attention: Betty Chang Telephone No.: (212) 827-7772 Facsimile No.: (212) 827-7232

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

BANCO BILBAO VIZCAYA ARGENTARIA, S.A., NEW YORK BRANCH,
as a Lender
By:	/s/ Mathias Rosenthal
Name:	Mathias Rosenthal
Title:	Associate
By:	/s/ Michael D’Anna
Name:	Michael D’Anna
Title:	Executive Director
Address: 1345 Ave of the Americas, 45th Floor New York, NY 10105 Attention: Telephone No.: 212-7281510 Facsimile No.: 212-3332904

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

THE NORTHERN TRUST COMPANY,
as a Lender
By:	/s/ Steve Ryan
Name:	Steve Ryan
Title:	Senior Vice President

Address:

50 S. LaSalle St.

Chicago, IL

Attention: Keith Burson

Telephone No.: 312-444-3099

Facsimile No.: 312-444-4906

Signature Page to 5-Year Credit Agreement

Harley-Davidson, Inc. et al

SCHEDULE I

FUNDING PROTOCOLS re: SYNDICATED GLOBAL LOANS

and SYNDICATED CANADIAN LOANS

Harley-Davidson $675million Global Credit Facility
Location	Tenor	Notice to Ad Agent	Minimum Amounts Borrowing/Inc rements	Rate fixing	Screen	Comment
U.S. Borrower - Syndicate Borrowing – US or IBF Nassau
US $ Borrowing		Houston Loan & Agency
ABR	overnight	same day/3PM NYT	$5mm/500m	Not Applicable	Not Applicable
Eurodollar	30, 60, 90, 1801	2 Business Days/12 noon NYT	$5mm/500m	Not Applicable	Reuters LIBOR01	NY fixing
GBP Sterling		London Loan & Agency
LIBOR	30, 60, 90, 180	3 Business Days/10AM NYT	£2.5mm/250m	funding date	Reuters LIBOR01	11AM London fixing
Euros		London Loan & Agency
EURIBOR	30, 60, 90, 180	3 Business Days/10AM NYT	€5mm/500m	2 days before funding	Reuters EURIBOR01	11AM Brussels fixing
Canadian $		London Loan & Agency
C$ LIBOR	30, 60, 90, 180	3 Business Days/11AM NYT	C$5mm/500m	2 days before funding	Reuters LIBOR01
CHF		London Loan & Agency
LIBOR	30, 60, 90, 180	3 Business Days/11AM London	CHF5mm/500m	2 days before funding	Reuters LIBOR02

¹  For each option which is offered with a tenor of 30, 60, 90 and 180, such tenor may also be for such other period as may be agreed to by each Lender.

Canadian Borrower - Syndicate Borrowings in Canada
		Toronto Loan & Agency
C$ Prime	overnight	same day/12 noon Toronto	C$500m/100m	notice day	Not Applicable
US$ ABR	overnight	same day/12 noon Toronto	$5mm/500m	Not Applicable	Not Applicable
C$ LIBOR	30, 60, 90, 180	3 Business Days /12 noon Toronto	C$5mm/500m	notice day	Reuters LIBOR01
US$ Eurodollar	30, 60, 90, 180	3 Business Days /12 noon Toronto	$5mm/500m	2 days before funding	Reuters LIBOR01	11AM London fixing
CDOR (BAs)	30, 60, 90, 180	same day/10 am Toronto or 1 Business Day /12 noon Toronto	C$500m/100m	notice day	Reuters CDOR

SCHEDULE II

FUNDING PROTOCOLS re: SWING LINE LOANS

Harley-Davidson $675million Global Credit Facility
Location	Tenor	Notice to Ad Agent	Minimum Amounts Borrowing/ Increments	Rate fixing	Screen	Comment
US Borrower – Swing Line Borrowing
US $ Borrowing		Houston Loan & Agency
ABR	overnight	same day/3PM NYT	$1mm/500m	Not applicable	Not applicable
Money Market	less than 30 days	same day/3PM NYT	$1mm/500m	Not applicable	Telerate 3750
GBP Sterling		London Loan & Agency
LIBOR	less than 30 days	1 Business Day /12 noon NYT	£500m/250m	funding day	JPM Ref Rate
Euros		London Loan & Agency
EURIBOR	less than 30 days	1 Business Day /12 noon NYT	€1mm/500m	funding day	JPM Ref Rate
Canadian $ in U.S.		Houston Loan & Agency
C$ LIBOR	less than 30 days	1 Business Day /12 noon NYT	C$500m/100m	day before funding	Telerate 3750
Canadian $ in Canada		Toronto Loan & Agency
C$ Prime	overnight	same day/12 noon Toronto	C$500m/100m	notice day	Not applicable
CHF		London Loan & Agency
LIBOR	less than 30 days	1 Business Day/9 am London	CHF1mm/500m	notice day	JPM Ref Rate

Canadian Borrower – Swing Line Borrowings in Canada
		Toronto Loan & Agency
C$ Prime	overnight	same day/12 noon Toronto	C$500m/100m	notice day	Not applicable
CDOR	less than 30 days	same day/12 noon Toronto	C$500m/100m	notice day	Not applicable

SCHEDULE III

MANDATORY COST

1. The Mandatory Cost is an addition to the interest rate to compensate Lenders for the cost of compliance with (a) the requirements of the Bank of England and/or the Financial Services Authority (or, in either case, any other authority which replaces all or any of its functions) or (b) the requirements of the European Central Bank.

2. On the first day of each Interest Period (or as soon as possible thereafter) the Global Administrative Agent shall calculate, as a percentage rate, a rate (the “Associated Costs Rate”) for each Lender, in accordance with the paragraphs set out below. The Mandatory Cost will be calculated by the Global Administrative Agent as a weighted average of the Lenders’ Associated Costs Rates (weighted in proportion to the percentage participation of each Lender in the relevant Loan) and will be expressed as a percentage rate per annum.

3. The Associated Costs Rate for any Lender lending from a Facility Office in a Participating Member State will be the percentage notified by that Lender to the Global Administrative Agent. This percentage will be certified by that Lender in its notice to the Global Administrative Agent to be its reasonable determination of the cost (expressed as a percentage of that Lender’s participation in all Loans made from that Facility Office) of complying with the minimum reserve requirements of the European Central Bank in respect of loans made from that Facility Office.

4. The Associated Costs Rate for any Lender lending from a Facility Office in the United Kingdom will be calculated by the Global Administrative Agent as follows:

(a) in relation to a Loan in Pounds Sterling:

AB + C(B – D) + E × 0.01	per cent. per annum
100  – (A + C)

(b) in relation to a Loan in any currency other than Pounds Sterling:

E × 0.01	per cent. per annum.
300

Where:

A is the percentage of Eligible Liabilities (assuming these to be in excess of any stated minimum) which that Lender is from time to time required to maintain as an interest free cash ratio deposit with the Bank of England to comply with cash ratio requirements.

B is the percentage rate of interest (excluding the Applicable Margin and the Mandatory Cost and, if the Loan is an Unpaid Sum, the additional rate of interest specified in Section 2.11 (Default Rate) payable for the relevant Interest Period on the Loan.

C is the percentage (if any) of Eligible Liabilities which that Lender is required from time to time to maintain as interest bearing Special Deposits with the Bank of England.

D is the percentage rate per annum payable by the Bank of England to the Global Administrative Agent on interest bearing Special Deposits.

E is designed to compensate Lenders for amounts payable under the Fees Rules and is calculated by the Global Administrative Agent as being the average of the most recent rates of charge supplied by the Reference Banks to the Global Administrative Agent pursuant to paragraph 7 below and expressed in pounds per £1,000,000.

5. For the purposes of this Schedule:

(a) “Eligible Liabilities” and “Special Deposits” have the meanings given to them from time to time under or pursuant to the Bank of England Act 1998 or (as may be appropriate) by the Bank of England;

(b) “Facility Office” means the office or offices notified by a Lender to the Global Administrative Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five (5) Business Days’ written notice) as the office or offices through which it will perform its obligations under this Agreement.

(c) “Fees Rules” means the rules on periodic fees contained in the Financial Services Authority Fees Manual or such other law or regulation as may be in force from time to time in respect of the payment of fees for the acceptance of deposits;

(d) “Fee Tariffs” means the fee tariffs specified in the Fees Rules under the activity group A.1 Deposit acceptors (ignoring any minimum fee or zero rated fee required pursuant to the Fees Rules but taking into account any applicable discount rate);

(e) “Participating Member State” means any member state of the European Union that adopts or has adopted the euro as its lawful currency in accordance with legislation of the European Union relating to economic and monetary union.

(f) “Reference Banks” means, in relation to Mandatory Cost, the principal London offices of JPMorgan Chase Bank, N.A. and Citibank, N.A. and, in relation to EURIBOR, the principal offices of JPMorgan Chase Bank, N.A. and Citibank, N.A. in the relevant jurisdiction or such other banks as may be appointed by the Global Administrative Agent in consultation with the Borrowers.

(g) “Tariff Base” has the meaning given to it in, and will be calculated in accordance with, the Fees Rules.

(h) “Unpaid Sum” means any sum due and payable but unpaid by a Borrower under the Loan Documents.

6. In application of the above formulae, A, B, C and D will be included in the formulae as percentages (i.e. 5 per cent. will be included in the formula as 5 and not as 0.05). A negative result obtained by subtracting D from B shall be taken as zero. The resulting figures shall be rounded to four decimal places.

7. If requested by the Global Administrative Agent, each Reference Bank shall, as soon as practicable after publication by the Financial Services Authority, supply to the Global Administrative Agent, the rate of charge payable by that Reference Bank to the Financial Services Authority pursuant to the Fees Rules in respect of the relevant financial year of the Financial Services Authority (calculated for this purpose by that Reference Bank as being the average of the Fee Tariffs applicable to that Reference Bank for that financial year) and expressed in pounds per £1,000,000 of the Tariff Base of that Reference Bank.

8. Each Lender shall supply any information required by the Global Administrative Agent for the purpose of calculating its Associated Costs Rate. In particular, but without limitation, each Lender shall supply the following information on or prior to the date on which it becomes a Lender:

(a) the jurisdiction of its Facility Office; and

(b) any other information that the Global Administrative Agent may reasonably require for such purpose.

Each Lender shall promptly notify the Global Administrative Agent of any change to the information provided by it pursuant to this paragraph.

9. The percentages of each Lender for the purpose of A and C above and the rates of charge of each Reference Bank for the purpose of E above shall be determined by the Global Administrative Agent based upon the information supplied to it pursuant to paragraphs 7 and 8 above and on the assumption that, unless a Lender notifies the Global Administrative Agent to the contrary, each Lender’s obligations in relation to cash ratio deposits and Special Deposits are the same as those of a typical bank from its jurisdiction of incorporation with a Facility Office in the same jurisdiction as its Facility Office.

10. The Global Administrative Agent shall have no liability to any person if such determination results in an Associated Costs Rate which over or under compensates any Lender and shall be entitled to assume that the information provided by any Lender or Reference Bank pursuant to paragraphs 3, 7 and 8 above is true and correct in all respects.

11. The Global Administrative Agent shall distribute the additional amounts received as a result of the Mandatory Cost to the Lenders on the basis of the Associated Costs Rate for each Lender based on the information provided by each Lender and each Reference Bank pursuant to paragraphs 3, 7 and 8 above.

12. Any determination by the Global Administrative Agent pursuant to this Schedule in relation to a formula, the Mandatory Cost, an Associated Costs Rate or any amount payable to a Lender shall, in the absence of manifest error, be conclusive and binding on all parties hereto.

13. The Global Administrative Agent may from time to time, after consultation with the relevant Borrowers and Lenders, determine and notify to all parties hereto any amendments which are required to be made to this Schedule in order to comply with any change in law, regulation or any requirements from time to time imposed by the Bank of England, the Financial Services Authority or the European Central Bank (or, in any case, any other authority which replaces all or any of its functions) and any such determination shall, in the absence of manifest error, be conclusive and binding on all parties hereto.

SCHEDULE IV

INTERCOMPANY SUBORDINATION TERMS

(i) The Borrowers agree that any and all claims of the Borrowers against any Guarantor with respect to any “Guarantor Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor of all or any part of the Obligations, or against any of its properties shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Obligations; provided that, and not in contravention of the foregoing, so long as no Default has occurred and is continuing the Borrowers may make loans to and receive payments in the ordinary course with respect to such Guarantor Intercompany Indebtedness from any Guarantor to the extent permitted by the terms of the Agreement and the other Loan Documents. Notwithstanding any right of the Borrowers to ask, demand, sue for, take or receive any payment from any Guarantor, all rights, liens and security interests of the Borrowers, whether now or hereafter arising and howsoever existing, in any assets of any Guarantor shall be and are subordinated to the rights of the holders of the Obligations and the Global Administrative Agent in those assets. Except as otherwise permitted above, the Borrowers shall not have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the Obligations (other than contingent indemnity obligations) and the Hedging Obligations owing to any Lender or any Affiliate thereof (such Hedging Obligations, the “Hedging Liabilities”) shall have been fully paid and satisfied (in cash) and all financing arrangements pursuant to any Loan Document among the Borrowers and the holders of the Obligations (or any affiliate thereof) have been terminated. If all or any part of the assets of any Guarantor, or the proceeds thereof, are subject to any distribution, division or application to the creditors of such Guarantor, whether partial or complete, voluntary or involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any other action or proceeding, or if the business of such Guarantor is dissolved or if substantially all of the assets of such Guarantor are sold, then, and in any such event (such events being herein referred to as an “Insolvency Event”), any payment or distribution of any kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any indebtedness (excepting indebtedness for fees and other administrative charges, if any, as may from time to time accrue in the ordinary course of business) of any Guarantor to the Borrowers (“Guarantor Intercompany Indebtedness”) shall be paid or delivered directly to the Global Administrative Agent for application on any of the Obligations and Hedging Liabilities, due or to become due, until such Obligations and Hedging Liabilities (other than contingent indemnity obligations) shall have first been fully paid and satisfied (in cash). Should any payment, distribution, security or instrument or proceeds thereof be received by the Borrowers upon or with respect to any Guarantor Intercompany Indebtedness after an Insolvency Event prior to the satisfaction of all of the Obligations (other than contingent indemnity obligations) and Hedging Liabilities and the termination of all financing arrangements pursuant to any Loan Document among the Borrowers and the holders of the Obligations (and their affiliates), the Borrowers shall receive and hold the same in trust, as trustee, for the benefit of the holders of the Obligations and such Hedging Liabilities and shall forthwith deliver the same to the Global Administrative Agent, for the benefit of such Persons, in precisely the form received (except for the endorsement or assignment of the Borrowers where

necessary), for application to any of the Obligations and such Hedging Liabilities, due or not due, and, until so delivered, the same shall be held in trust by the Borrowers as the property of the holders of the Obligations and such Hedging Liabilities. If the Borrowers fail to make any such endorsement or assignment to the Global Administrative Agent, the Global Administrative Agent or any of its officers or employees are irrevocably authorized to make the same. The Borrowers agree that until the Obligations (other than the contingent indemnity obligations) and such Hedging Liabilities have been paid in full (in cash) and satisfied and all financing arrangements pursuant to any Loan Document among the Borrowers and the holders of the Obligations (and their affiliates) have been terminated, the Borrowers will not assign or transfer to any Person (other than the Global Administrative Agent) any claim the Borrowers have or may have against any Guarantor.

(ii) Each Guarantor agrees that any and all claims of such Guarantor against the Borrowers with respect to any “Borrower Intercompany Indebtedness” (as hereinafter defined), any endorser, obligor or any other guarantor of all or any part of the Obligations, or against any of its properties shall be subordinate and subject in right of payment to the prior payment, in full and in cash, of all Obligations; provided that, and not in contravention of the foregoing, so long as no Default has occurred and is continuing each Guarantor may make loans to and receive payments in the ordinary course with respect to such Borrower Intercompany Indebtedness from the Borrowers to the extent permitted by the terms of the Agreement and the other Loan Documents. Notwithstanding any right of any Guarantor to ask, demand, sue for, take or receive any payment from the Borrowers, all rights, liens and security interests of such Guarantor, whether now or hereafter arising and howsoever existing, in any assets of the Borrowers shall be and are subordinated to the rights of the holders of the Obligations and the Global Administrative Agent in those assets. Except as otherwise permitted above, no Guarantor shall have any right to possession of any such asset or to foreclose upon any such asset, whether by judicial action or otherwise, unless and until all of the Obligations (other than contingent indemnity obligations) and the Hedging Liabilities shall have been fully paid and satisfied (in cash) and all financing arrangements pursuant to any Loan Document among the Borrowers and the holders of Obligations (or any affiliate thereof) have been terminated. If all or any part of the assets of the Borrowers, or the proceeds thereof, are subject to any distribution, division or application to the creditors of the Borrowers, whether partial or complete, voluntary or involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any other action or proceeding, or if the business of any of the Borrowers is dissolved or if substantially all of the assets of any of the Borrowers are sold, then, and in any such event (such events being herein referred to as an “Insolvency Event”), any payment or distribution of any kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any indebtedness (excepting indebtedness for fees and other administrative charges, if any, as may from time to time accrue in the ordinary course of business) of the Borrowers to any Guarantor (“Borrower Intercompany Indebtedness”) shall be paid or delivered directly to the Global Administrative Agent for application on any of the Obligations and Hedging Liabilities, due or to become due, until such Obligations and Hedging Liabilities (other than contingent indemnity obligations) shall have first been fully paid and satisfied (in cash). Should any payment, distribution, security or instrument or proceeds thereof be received by any Guarantor upon or with respect to any Borrower Intercompany

Indebtedness after an Insolvency Event prior to the satisfaction of all of the Obligations (other than contingent indemnity obligations) and Hedging Liabilities and the termination of all financing arrangements pursuant to any Loan Document among the Borrowers and the holders of the Obligations (and their affiliates), the applicable Guarantor shall receive and hold the same in trust, as trustee, for the benefit of the holders of the Obligations and such Hedging Liabilities and shall forthwith deliver the same to the Global Administrative Agent, for the benefit of such Persons, in precisely the form received (except for the endorsement or assignment of such Guarantor where necessary), for application to any of the Obligations and such Hedging Liabilities, due or not due, and, until so delivered, the same shall be held in trust by such Guarantor as the property of the holders of the Obligations and such Hedging Liabilities. If any Guarantor fails to make any such endorsement or assignment to the Global Administrative Agent, the Global Administrative Agent or any of its officers or employees are irrevocably authorized to make the same. Each Guarantor agrees that until the Obligations (other than the contingent indemnity obligations) and such Hedging Liabilities have been paid in full (in cash) and satisfied and all financing arrangements pursuant to any Loan Document among the Borrowers and the holders of the Obligations (and their affiliates) have been terminated, such Guarantor will not assign or transfer to any Person (other than the Global Administrative Agent) any claim such Guarantor has or may have against the Borrowers.

SCHEDULE 6.2.1(b)

INDEBTEDNESS

1. Indebtedness arising under that certain 4-Year Credit Agreement dated as of April 28, 2011 among Harley-Davidson, Inc. and certain of its subsidiaries, the lenders from time to time party thereto and JPMorgan Chase Bank, N.A., as Global Administrative Agent, and/or any “Loan Document” under and as defined therein, in each case as amended, restated, supplemented or otherwise modified from time to time.

2. Indebtedness arising under the following industrial revenue bonds and related agreements, instruments and documents: $2,273,000 Missouri Development Finance Board BUILD Missouri Revenue Bonds Series 2002 (Harley-Davidson Project).

3. Indebtedness arising under overdraft facilities of Harley-Davidson Japan KK in an aggregate amount of 1.9 billion Yen.

SCHEDULE 6.2.2(c)

LIENS

1. Liens from time to time securing the industrial revenue bonds described on Schedule 6.2.1(b), including extensions, renewals and replacements thereof

EXHIBIT A

TO

CREDIT AGREEMENT

Commitments

Lender	Commitment
JPMorgan Chase Bank, N.A.	$	80,000,000
Citibank, N.A.	$	80,000,000
U.S. Bank National Association	$	80,000,000
The Royal Bank of Scotland plc	$	80,000,000
BMO Harris Bank N.A.	$	50,000,000
Mizuho Corporate Bank, Ltd., New York Branch	$	50,000,000
The Bank of New York Mellon	$	50,000,000
The Bank of Tokyo-Mitsubishi UFJ, Ltd.	$	50,000,000
Wells Fargo Bank, National Association	$	50,000,000
Fifth Third Bank	$	25,000,000
Goldman Sachs Bank USA	$	25,000,000
Toronto Dominion Bank (New York) LLC	$	25,000,000
Banco Bilbao Vizcaya Argentaria S.A., New York Branch	$	15,000,000
The Northern Trust Company	$	15,000,000
Aggregate Commitment	$	675,000,000

Lender	Syndicated Canadian Commitment
JPMorgan Chase Bank, N.A., Toronto Branch	$	55,000,000
Citibank, N.A., Canadian Branch	$	55,000,000
U.S. Bank National Association, Canada Branch	$	50,000,000
BMO Harris Bank N.A.	$	50,000,000
Fifth Third Bank	$	20,000,000
The Toronto-Dominion Bank	$	20,000,000
Aggregate Syndicated Canadian Commitment	$	250,000,000

EXHIBIT B-1

TO

CREDIT AGREEMENT

Form of Syndicated Global Note

                     , 20     

[HARLEY-DAVIDSON, INC., a Wisconsin corporation] [HARLEY-DAVIDSON FUNDING CORP., a Nevada corporation] [HARLEY-DAVIDSON FINANCIAL SERVICES, INC., a Delaware corporation] (the “Global Borrower”), promises to pay to the order of [                    ] (the “Syndicated Global Lender”) the aggregate unpaid principal amount of all Syndicated Global Loans made by the Syndicated Global Lender to the Global Borrower pursuant to Article II of the Credit Agreement hereinafter referred to (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Agreement”; capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement), in immediately available funds on the dates and at the offices of JPMorgan Chase Bank, N.A., as Global Administrative Agent, specified in the Agreement, together with interest on the unpaid principal amount hereof at the rates and on the dates determined in accordance with the Agreement. The Global Borrower shall pay the principal of and accrued and unpaid interest on the Syndicated Global Loans in full on the Termination Date.

The Syndicated Global Lender shall, and is hereby authorized to, record on the schedule attached hereto, or otherwise record in accordance with its usual practice, the date and amount of each Syndicated Global Loan and the date and amount of each principal payment hereunder.

This Note is one of the Syndicated Global Notes issued pursuant to, and is entitled to the benefits of, the 5-Year Credit Agreement dated as of April 13, 2012 entered into among the Global Borrower, [Harley-Davidson, Inc., a Wisconsin corporation,] [Harley-Davidson Funding Corp., a Nevada corporation,] [Harley-Davidson Financial Services, Inc., a Delaware corporation,] Harley-Davidson Financial Services Canada, Inc., a corporation organized and existing under the laws of Canada, Harley-Davidson Financial Services International, Inc., a Delaware corporation, Harley-Davidson Credit Corp., a Nevada corporation and JPMorgan Chase Bank, N.A., as the Global Administrative Agent and the Global Swing Line Lender and the institutions from time to time party thereto as Lenders, including the Syndicated Global Lender, to which Agreement, as it may be amended from time to time, reference is hereby made for a statement of the terms and conditions governing this Syndicated Global Note, including the terms and conditions under which this Syndicated Global Note may be prepaid or its maturity date accelerated. The Agreement, among other things, provides for the making of “Syndicated Global Loans” by the Syndicated Global Lender to the Global Borrower from time to time in an aggregate amount not to exceed at any time outstanding the Syndicated Global Lender’s Commitment, except as otherwise contemplated in the Agreement.

Except as otherwise provided in the Agreement, the Global Borrower hereby waives presentment, demand, protest and notice of any kind. No failure to exercise, and no delay in exercising, any rights hereunder on the part of the holder hereof shall operate as a waiver of such rights.

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

B-1-1

[HARLEY-DAVIDSON, INC.]

[HARLEY-DAVIDSON FUNDING CORP.]

[HARLEY-DAVIDSON FINANCIAL SERVICES, INC.]

By:

Name:

Title:

B-1-2

Schedule of Syndicated Global Loans and Payments of Principal

to

Syndicated Global Note of [Insert relevant Global Borrower]

Dated             , 20            

Date Principal amount and currency of Syndicated Loan Maturity of Interest Period Principal Amount Paid Unpaid Balance

B-1-3

EXHIBIT B-2

TO

CREDIT AGREEMENT

Form of Bid Rate Note

            , 20            

[HARLEY-DAVIDSON, Inc., a Wisconsin corporation] [HARLEY-DAVIDSON FUNDING CORP., a Nevada corporation] [HARLEY-DAVIDSON FINANCIAL SERVICES, INC., a Delaware corporation] (the “Global Borrower”), promises to pay to the order of [            ] (the “Syndicated Global Lender”) the aggregate unpaid principal amount of all Bid Rate Loans made by the Syndicated Global Lender to the Global Borrower pursuant to Article II of the Credit Agreement hereinafter referred to (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Agreement”; capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement), in immediately available funds on the dates and at the offices of JPMorgan Chase Bank, N.A., as Global Administrative Agent, specified in the Agreement, together with interest on the unpaid principal amount hereof at the rates and on the dates determined in accordance with the Agreement. The Global Borrower shall pay the principal of and accrued and unpaid interest on each Bid Rate Loan in full on the maturity date for such Bid Rate Loan determined in accordance with the Agreement.

The Syndicated Global Lender shall, and is hereby authorized to, record on the schedule attached hereto, or otherwise record in accordance with its usual practice, the date, amount, maturity date and other pertinent terms of, and the interest rate and interest payment dates applicable to, each Bid Rate Loan, and the date and amount of each principal payment hereunder.

This Bid Rate Note is one of the Bid Rate Notes issued pursuant to, and is entitled to the benefits of, the 5-Year Credit Agreement dated as of April 13, 2012 entered into among the Global Borrower, [Harley-Davidson, Inc., a Wisconsin corporation,] [Harley-Davidson Funding Corp., a Nevada corporation,] [Harley-Davidson Financial Services, Inc., a Delaware corporation,] Harley-Davidson Financial Services Canada, Inc., a corporation organized and existing under the laws of Canada, Harley-Davidson Financial Services International, Inc., a Delaware corporation, Harley-Davidson Credit Corp., a Nevada corporation and JPMorgan Chase Bank, N.A., as the Global Administrative Agent and the Global Swing Line Lender and the institutions from time to time party thereto as Lenders, including the Syndicated Global Lender, to which Agreement, as it may be amended from time to time, reference is hereby made for a statement of the terms and conditions governing this Bid Rate Note, including the terms and conditions under which this Bid Rate Note may be prepaid or its maturity date accelerated.

Except as otherwise provided in this Agreement, the Global Borrower hereby waives presentment, demand, protest and notice of any kind. No failure to exercise, and no delay in exercising, any rights hereunder on the part of the holder hereof shall operate as a waiver of such rights.

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

B-2-1

[HARLEY-DAVIDSON, INC.]

[HARLEY-DAVIDSON FUNDING CORP.]

[HARLEY-DAVIDSON FINANCIAL SERVICES, INC.]

By:

Name:

Title:

B-2-2

Schedule of Bid Rate Loans and Payments of Principal

to

Bid Rate Note of [Insert relevant Global Borrower]

Dated             , 20            

Date Principal amount and
currency of Bid Rate Loan Maturity Date of Loan Interest Rate and
Basis for
Calculation Interest Payment Dates Other Pertinent Terms Principal Amount Paid

B-2-3

EXHIBIT C

TO

CREDIT AGREEMENT

Form of Assignment Agreement

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement (as defined below), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Global Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including any letters of credit, guarantees, and swingline loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.

1.	Assignor:
2.	Assignee:
		[and is an Affiliate/Approved Fund of [identify Lender]1]

¹  Select as applicable.

C-1

3.	Borrowers:	Harley-Davidson, Inc. Harley-Davidson Funding Corp. Harley-Davidson Financial Services, Inc. Harley-Davidson Financial Services Canada, Inc.
4.	Global Administrative Agent:	JPMorgan Chase Bank, N.A., as the Global Administrative Agent under the Credit Agreement
5.	Credit Agreement:	The $675,000,000 5-Year Credit Agreement dated as of April 13, 2012 among the Borrowers, Harley-Davidson Financial Services International, Inc., Harley-Davidson Credit Corp., the Lenders parties thereto and JPMorgan Chase Bank, N.A., as Global Administrative Agent and the Global Swing Line Lender (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”)
6.	Assigned Interest:

Facility Assigned	Aggregate Amount of Commitment/Loans for all Lenders	Amount of Commitment/Loans Assigned	Percentage Assigned of Commitment/Loans2
	$	$		%
	$	$		%
	$	$		%

Effective Date:             , 20     [TO BE INSERTED BY GLOBAL ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

The terms set forth in this Assignment and Assumption are hereby agreed to:

ASSIGNOR

[NAME OF ASSIGNOR]

By:

Title:

ASSIGNEE

[NAME OF ASSIGNEE]

By:

Title:

²  Set forth, so at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

C-2

[Consented to and]³ Accepted:

JPMORGAN CHASE BANK, N.A., as Global Administrative Agent

By:

Title:

[Consented to:]⁴

[HARLEY-DAVIDSON, INC.]

By:

Title:

³  To be added only if the consent of the Global Administrative Agent is required by the terms of the Credit Agreement.

⁴  To be added only if the consent of Harley is required by the terms of the Credit Agreement.

C-3

ANNEX I

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1. Representations and Warranties.

1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrowers, any of their respective Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrowers, any of their respective Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.

1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 6.1 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Global Administrative Agent or any other Lender, and (v) if it is a Non-U.S. Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Global Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

2. Payments. From and after the Effective Date, the Global Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

3. General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption

C-4

electronically shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed by, and construed in accordance with, the laws of the state of New York, but giving effect to Federal laws applicable to national banks.

C-5

APPENDIX I

to

Assignment and Assumption Agreement

FORM OF NOTICE OF ASSIGNMENT

[Date]

To: Harley-Davidson, Inc.

[Address]

Attention:

JPMorgan Chase Bank, N.A. as Global Administrative Agent

[Address]

Attention:

From: [NAME OF ASSIGNOR] (the “Assignor”)

 [NAME OF ASSIGNEE] (the “Assignee”)

1. We refer to the 5-Year Credit Agreement (as it may be amended, modified, renewed or extended from time to time, the “Credit Agreement”) described in Item 5 of the Assignment Agreement defined below. Capitalized terms used herein and not otherwise defined herein shall have the meanings attributed to them in the Credit Agreement.

2. This Notice of Assignment (this “Notice”) is given and delivered to the Global Administrative Agent pursuant to Section 13.3(B) of the Credit Agreement.

3. The Assignor and the Assignee have entered into an Assignment and Assumption Agreement, dated as of             , 20     (the “Assignment Agreement”), pursuant to which, among other things, the Assignor has sold, assigned, delegated and transferred to the Assignee, and the Assignee has purchased, accepted and assumed from the Assignor the Assigned Interest defined in the Assignment Agreement. The Effective Date of the Assignment Agreement shall be as specified in the Assignment Agreement.

4. The Assignor and the Assignee hereby give to Harley and the Global Administrative Agent notice of the assignment and delegation referred to herein.

5. The Assignee hereby represents and warrants that none of the funds, monies, assets or other consideration being used to make the purchase pursuant to the Assignment Agreement are “plan assets” as defined under ERISA and that its rights, benefits, and interests in and under the Loan Documents will not be “plan assets” under ERISA.

C-6

6. The Assignee authorizes the Administrative Agent to act as its contractual representative under the Loan Documents in accordance with the terms thereof.

NAME OF ASSIGNOR	NAME OF ASSIGNEE
By:	By:
Name:	Name:
Title:	Title:
Acknowledged and consented to by: JPMORGAN CHASE BANK, N.A., as Global Administrative Agent	Acknowledged and consented to by: HARLEY-DAVIDSON, INC.
By:	By:
Name:	Name:
Title:	Title:

C-7

EXHIBIT D

TO

CREDIT AGREEMENT

List of Closing Documents

Attached

D-1

5-YEAR CREDIT FACILITY

TO

HARLEY-DAVIDSON, INC., HARLEY-DAVIDSON FUNDING CORP. and HARLEY-

DAVIDSON FINANCIAL SERVICES, INC., as the U.S. Borrowers

and

HARLEY-DAVIDSON FINANCIAL SERVICES CANADA, INC., as the Canadian Borrower

April 13, 2012

LIST OF CLOSING DOCUMENTS⁶

A. CREDIT AGREEMENT AND CERTAIN LOAN DOCUMENTS

1. 5-Year Credit Agreement (the “Credit Agreement”) dated as of April 13, 2012 entered into among Harley-Davidson, Inc., a Wisconsin Corporation (“Harley”), Harley-Davidson Funding Corp., a Nevada corporation (“HDFC”), Harley-Davidson Financial Services, Inc., a Delaware corporation (“HDFS” and together with Harley and HDFC, the “U.S. Borrowers”), Harley-Davidson Financial Services Canada, Inc. (the “Canadian Borrower” and together with the U.S. Borrowers, the “Borrowers”), Harley-Davidson Financial Services International, Inc., a Delaware corporation (“HDFSI”), Harley-Davidson Credit Corp., a Nevada corporation (“HDCC”), the institutions from time to time a party thereto (the “Lenders”) and JPMorgan Chase Bank, N.A., as the Global Administrative Agent, evidencing a 5-year revolving credit facility in the original aggregate amount of $675,000,000.

SCHEDULES

Schedule I	—	Funding Protocols re: Syndicated Global Loans and Syndicated Canadian Loans
Schedule II	—	Funding Protocols re: Swing Line Loans
Schedule III	—	Mandatory Cost
Schedule IV	—	Intercompany Subordination Terms
Schedule 6.2.1(b)	—	Indebtedness
Schedule 6.2.2(c)	—	Liens
		EXHIBITS
EXHIBIT A	—	Commitments (Definitions)
EXHIBIT B-1	—	Form of Syndicated Global Note (Definitions)
EXHIBIT B-2	—	Form of Bid Rate Note (Definitions)
EXHIBIT C	—	Form of Assignment Agreement (§ 13.3)
EXHIBIT D	—	List of Closing Documents (§ 4.1)

⁶  Each capitalized term used herein and not defined herein shall have the meaning assigned to such term in the above-defined Credit Agreement. Items appearing in bold and italics shall be prepared and/or provided by the Borrowers and/or their counsel.

1

EXHIBIT E	—	Form of Syndicated Canadian Addendum (Definitions)
EXHIBIT F	—	Form of Commitment and Acceptance (§ 2.4(b))

2. Syndicated Global Notes executed by the applicable Borrower pursuant to the Credit Agreement in favor of requesting Lenders.

3. Syndicated Canadian Notes executed by the Canadian Borrower pursuant to the Credit Agreement in favor of requesting Syndicated Canadian Banks.

4. Bid Rate Notes executed by the applicable Borrower pursuant to the Credit Agreement in favor of the requesting Lenders.

5. Syndicated Canadian Addendum executed by the Canadian Borrower, the Syndicated Canadian Banks and the Global Administrative Agent.

B. CORPORATE DOCUMENTS

6. Certificate of the Secretary of the each of the Borrowers certifying (i) that attached thereto is a true and correct copy of resolutions of the Board of Directors (or comparable governing body) of such Borrower approving and authorizing the execution, delivery and performance of each document to which it is a party, (ii) that there have been no changes in the Certificate of Incorporation (or comparable constituent document) of such Borrower since the date of the most recent certification thereof by the appropriate governmental authority in its jurisdiction of organization delivered to the Global Administrative Agent, (iii) Good Standing certificate of each of the Borrowers from the office of the Secretary of State (or analogous governmental body) of its jurisdiction of organization (to the extent such concept is applicable in such jurisdiction), and (iv) the By-Laws (or other comparable governing document) attached thereto of each Borrower as in effect on the date of such certification.

7. Incumbency Certificate of each of the Borrowers.

8. Certificate of the Secretary of HDCC certifying (i) that attached thereto is a true and correct copy of resolutions of the Board of Directors of HDCC approving and authorizing the execution, delivery and performance of each document to which it is a party, (ii) that there have been no changes in the Certificate of Incorporation of HDCC since the date of the most recent certification thereof by the Secretary of State of Nevada delivered to the Agent, (iii) Good Standing certificate for HDCC from the office of the Secretary of State of Nevada, and (iv) the By-Laws attached thereto of HDCC as in effect on the date of such certification.

9. Incumbency Certificate of HDCC.

10. Certificate of the Secretary of HDFSI certifying (i) that attached thereto is a true and correct copy of resolutions of the Board of Directors of HDFSI approving and authorizing the execution, delivery and performance of each document to which it is a party, (ii) that there have been no changes in the Certificate of Incorporation of HDFSI since the date of the most recent certification thereof by the Secretary of State of Delaware delivered to the Agent, (iii) Good Standing certificate for HDFSI from the office of the Secretary of State of Delaware, and (iv) the By-Laws attached thereto of HDFSI as in effect on the date of such certification.

2

11. Incumbency Certificate of HDFSI.

C. OPINIONS

12. Opinion letter of Foley & Lardner LLP, U.S. counsel to Harley, HDFC, HDFS, HDFSI and HDCC addressed to the Global Administrative Agent and the Lenders.

13. Opinion letter of Holland & Hart LLP, Nevada counsel to HDFC and HDCC addressed to the Global Administrative Agent and the Lenders.

14. Opinion letter of Paul J. Jones, general counsel of Harley, HDFC, HDFS, HDFSI and HDCC addressed to the Global Administrative Agent and the Lenders.

15. Opinion letter of Cassels Brock & Blackwell LLP, Canadian counsel to the Canadian Borrower addressed to the Global Administrative Agent and the Lenders.

D. DOCUMENTATION RELATING TO HARLEY-DAVIDSON, INC.

16. Support Agreement, dated as of September 26, 1996 between Harley and HDFS evidencing Harley’s agreement to support certain debts of HDFS and its Subsidiaries, together with and as supplemented by (i) the letter agreement dated as of April 28, 2011 to the Global Administrative Agent from Harley and HDFS and (ii) the letter agreement dated as of April 13, 2012 to the Global Administrative Agent from Harley and HDFS.

17. Subordination Agreement from Harley for the benefit of the Global Administrative Agent.

E. CLOSING CERTIFICATES AND MISCELLANEOUS

18. Payout and Termination Letter with respect to the Existing Credit Agreement evidencing, to the Global Administrative Agent’s satisfaction, the termination of the Existing Credit Agreement.

19. Amendment No. 1 to the Existing 4-Year Credit Agreement.

20. Legal opinions by Foley & Lardner LLP and Paul J. Jones addressed to the Global Administrative Agent and the Lenders in respect of items 16, 17 and 19 above.

3

EXHIBIT E

TO

CREDIT AGREEMENT

Form of Syndicated Canadian Addendum

Attached

E-1

EXECUTION COPY

SYNDICATED CANADIAN ADDENDUM

FOR CANADIAN BORROWER

SYNDICATED CANADIAN ADDENDUM (the “Addendum”) dated as of April 13, 2012 to the Credit Agreement (as defined below).

ARTICLE 1

Definitions

SECTION 1.01. Defined Terms. Unless otherwise defined herein, terms defined in the Credit Agreement shall have the same meanings in this Addendum. As used in this Addendum, the following terms shall have the meanings specified below:

“BA Discount Rate” means, with respect to an issue of Bankers’ Acceptances with the same maturity date, (a) for a Syndicated Canadian Bank which is a Schedule I Lender, the average CDOR Rate for the appropriate term and (b) for a Syndicated Canadian Bank which is not a Schedule I Lender, the arithmetic average (rounded upwards to the nearest multiple of 0.01%) of the actual discount rates for Bankers’ Acceptances for such term accepted by the Schedule II Reference Banks established in accordance with their normal practices at or about 10:00 a.m. (Toronto time) on the date of issuance but not to exceed the actual rate of discount applicable to Bankers’ Acceptances established pursuant to clause (a) for the same Bankers Acceptance issue plus 10 basis points per annum.

“BA Equivalent Loan” means a Loan made to the Canadian Borrower by a Non BA Lender evidenced by a Discount Note.

“Bankers’ Acceptance” means a bill of exchange, including a depository bill issued in accordance with the Depository Bills and Notes Act (Canada), denominated in Canadian Dollars, drawn by the Canadian Borrower and accepted by a Syndicated Canadian Bank and includes a Discount Note.

“Bankers’ Acceptance Advance” means an Advance by way of Bankers’ Acceptance Loans.

“Bankers’ Acceptance Loan” means a borrowing by way of the issuance of Bankers’ Acceptances.

“Bankers’ Acceptance Proceeds” means, for any Bankers’ Acceptance issued hereunder, an amount calculated on the applicable date that such Bankers’ Acceptance is accepted by multiplying:

(a) the face amount of the Bankers’ Acceptance

by

(b) the quotient obtained by dividing:

(i) one

by

(ii) the sum of one plus the product of:

(A) the BA Discount Rate applicable to the Bankers’ Acceptance; and

(B) a fraction, the numerator of which is the number of days in the applicable Interest Period and the denominator of which is 365

with the quotient being rounded up or down to the fifth decimal place and .00005 being rounded up.

“Canadian Borrower” means Harley-Davidson Financial Services Canada, Inc., a corporation organized and existing under the laws of Canada, together with its successors and permitted assigns.

“CDOR Rate” means, on any day, with respect to a particular term as specified herein, the annual rate of discount or interest which is the arithmetic average of the discount rates for such term applicable to Canadian Dollar bankers’ acceptances identified as such on the Reuters Screen CDOR Page at approximately 10:00 a.m. on such day, or if such day is not a Business Day, then on the immediately preceding Business Day (as adjusted by the Global Administrative Agent after 10:00 a.m. to reflect any error in any posted rate or in the posted average annual rate). If the rate does not appear on the Reuters Screen CDOR Page as contemplated above, then the CDOR Rate on any day shall be calculated as the arithmetic average of the discount rates for such term applicable to Canadian Dollar bankers’ acceptances of, and as quoted by, the Schedule I Reference Banks, as of 10:00 a.m. on that day, or if that day is not a Business Day, then on the immediately preceding Business Day.

“Credit Agreement” shall mean that certain 5-Year Credit Agreement dated as of April 13, 2012 entered into by and among Harley-Davidson, Inc., a Wisconsin corporation, Harley-Davidson Funding Corp., a Nevada corporation, Harley-Davidson Financial Services, Inc., a Delaware corporation, Harley-Davidson Financial Services Canada, Inc., a corporation organized and existing under the laws of Canada, Harley-Davidson Financial Services International Inc., a Delaware corporation, Harley-Davidson Credit Corp., a Nevada corporation, the institutions from time to time a party thereto as Lenders, JPMorgan Chase Bank, N.A., as the Global Administrative Agent and the Global Swing Line Lender, and Citibank, N.A., in its capacity as Syndication Agent, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Discount Note” means a non-interest bearing promissory note denominated in Canadian Dollars, substantially in the form of Schedule IV to this Addendum, issued by the Canadian Borrower to a Non BA Lender to evidence a BA Equivalent Loan.

“Non BA Lender” means a Syndicated Canadian Bank that cannot or does not as a matter of policy issue Bankers’ Acceptances.

“Schedule I Lender” means any Syndicated Canadian Bank named on Schedule I to the Bank Act (Canada).

“Schedule I Reference Banks” means any bank or banks named on Schedule I to the Bank Act (Canada) as may be agreed from time to time by the Global Administrative Agent and the Canadian Borrower.

2

“Schedule II Lender” means any Syndicated Canadian Bank named on Schedule II or Schedule III to the Bank Act (Canada).

“Schedule II Reference Banks” means JPMorgan Chase Bank, N.A., Toronto Branch and any other bank named on Schedule II or Schedule III to the Bank Act (Canada) as may be agreed from time to time by the Global Administrative Agent and the Canadian Borrower.

“Stamping Fee” is defined in Section 2.03(m) hereof.

“Syndicated Canadian Pro Rata Share” means, with respect to any Syndicated Canadian Bank, the percentage obtained by dividing (A) such Syndicated Canadian Bank’s Syndicated Canadian Commitment (in each case, as adjusted from time to time in accordance with the provisions hereof and of the Credit Agreement) by (B) the aggregate amount of the Syndicated Canadian Commitments.

SECTION 1.02. Terms Generally. Wherever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. All references herein to Sections and Schedules shall be deemed references to Sections of and Schedules to this Addendum unless the context shall otherwise require.

ARTICLE 2

The Credits

SECTION 2.01. Syndicated Canadian Loans.

(a) This Addendum (as the same may be amended, restated, waived, supplemented or otherwise modified from time to time) is the “Syndicated Canadian Addendum” as defined in the Credit Agreement and is, together with the borrowings made hereunder, subject in all respects to the terms and provisions of the Credit Agreement except to the extent that the terms and provisions of the Credit Agreement are modified by this Addendum. The Syndicated Canadian Banks party to this Addendum are set forth on Schedule I, as such Schedule may be amended or supplemented from time to time by the Global Administrative Agent. For purposes of this Addendum, “Syndicated Canadian Loans” shall include Bankers’ Acceptance Loans made pursuant to Section 2.03 hereof.

(b) Any modifications to the interest payment dates, Interest Periods, interest rates and any other special provisions applicable to Syndicated Canadian Loans under this Addendum are set forth on Schedule II. If Schedule II states “Same as Credit Agreement” with respect to any item listed thereon, then the corresponding provisions of the Credit Agreement, without modification, shall govern this Addendum and the Syndicated Canadian Loans made pursuant to this Addendum in respect of such item.

(c) Any special borrowing procedures or funding arrangements for Syndicated Canadian Loans under this Addendum, any provisions for the issuance of promissory notes to evidence the Syndicated Canadian Loans made hereunder and any additional information requirements applicable to Syndicated Canadian Loans under this Addendum are set forth on Schedule III. If no such special procedures, funding arrangements, provisions or additional requirements are set forth on Schedule III, then the corresponding procedures, funding arrangements, provisions and information requirements set forth in the Credit Agreement shall govern this Addendum.

3

SECTION 2.02. Maximum Borrowing Amounts. The Syndicated Canadian Commitment for each Syndicated Canadian Bank is set forth on Schedule I hereto.

SECTION 2.03. Bankers’ Acceptances.

(a) Subject to the terms and conditions of the Credit Agreement and this Addendum, the undersigned Canadian Borrower shall be entitled to receive the Bankers’ Acceptance Proceeds of Bankers’ Acceptances denominated in Canadian Dollars in accordance with the provisions of Section 2.2 of the Credit Agreement and this Addendum. For the purposes of this Addendum and the Credit Agreement, the full face amount of Bankers’ Acceptances, without discount, shall be used when calculations are made to determine the amount of Syndicated Canadian Loans outstanding. Each determination by the Global Administrative Agent of the Stamping Fee, the BA Discount Rate and the Bankers’ Acceptance Proceeds shall, in the absence of manifest error be presumed correct.

(b) Conditions Applicable to Bankers’ Acceptances Schedule II and Schedule III set forth additional conditions applicable to Bankers’ Acceptances.

(c) Term. Each Bankers’ Acceptance shall have an Interest Period as set out in Schedule II, subject to availability. No Interest Period shall extend beyond the Termination Date. If such Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall end on the next preceding day that is a Business Day.

(d) Discount Rate. On each Borrowing Date on which Bankers’ Acceptances are to be accepted, the Global Administrative Agent shall advise the Canadian Borrower as to its determination of the applicable BA Discount Rate for the Bankers’ Acceptances which the Syndicated Canadian Banks have agreed to purchase.

(e) Purchase. Each Syndicated Canadian Bank agrees to purchase a Bankers’ Acceptance accepted by it. The Canadian Borrower shall sell, and such Syndicated Canadian Bank shall purchase, the Bankers’ Acceptance at the applicable BA Discount Rate. The Syndicated Canadian Bank shall provide, to the account of the Global Administrative Agent, the Bankers’ Acceptance Proceeds less the Stamping Fee payable by the Canadian Borrower with respect to the Bankers’ Acceptance. The Global Administrative Agent shall make available to the Canadian Borrower, in accordance with the provisions of Section 2.5(b) of the Credit Agreement, the BA Acceptance Proceeds less the applicable Acceptance Fee with respect to each Bankers’ Acceptance purchased and each BA Equivalent Loan advanced by a Syndicated Canadian Bank Syndicated Canadian Bank on the date of such acceptance.

(f) Sale. Each Syndicated Canadian Bank may from time to time hold, sell, rediscount, trade or otherwise dispose of any or all Bankers’ Acceptances accepted and purchased by it.

(g) Power of Attorney for the Execution of Bankers’ Acceptances. To facilitate availment of the Bankers’ Acceptance Loans, the Canadian Borrower hereby appoints each Syndicated Canadian Bank as its attorney to sign and endorse on its behalf, in handwriting or by facsimile or mechanical signature as and when deemed necessary by such Canadian Syndicated Bank, blank forms of Bankers’ Acceptances. In this respect, it is each Syndicated Canadian Bank’s responsibility to maintain an adequate supply of blank forms of Bankers’ Acceptances for acceptance under this Agreement. Each Syndicated Canadian Bank shall exercise the same degree of care in the custody and safekeeping of

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signed blank forms of Bankers’ Acceptance as it exercises in respect of its own bearer securities. The Canadian Borrower recognizes and agrees that all Bankers’ Acceptances signed and/or endorsed on its behalf by a Syndicated Canadian Bank shall bind the Canadian Borrower as fully and effectually as if signed in the handwriting of and duly issued by the proper signing officers of the Canadian Borrower. Each Syndicated Canadian Bank is hereby authorized to issue such Bankers’ Acceptances endorsed in blank in such face amounts as may be determined by such Syndicated Canadian Bank; provided that the aggregate amount thereof is equal to the aggregate amount of Bankers’ Acceptances required to be accepted and purchased by such Syndicated Canadian Bank. No Syndicated Canadian Bank shall be liable for any damage, loss or other claim arising by reason of any loss or improper use of any such instrument except the gross negligence or wilful misconduct of the Syndicated Canadian Bank or its officers, employees, agents or representatives. On the repayment in full of all Obligations under the Credit Agreement or on request by the Canadian Borrower, a Syndicated Canadian Bank shall cancel all forms of Bankers’ Acceptances which have been pre-signed or pre-endorsed by or on behalf of the Canadian Borrower and which are held by such Syndicated Canadian Bank and have not yet been issued in accordance herewith. Each Syndicated Canadian Bank shall maintain a record with respect to Bankers’ Acceptances held by it in blank hereunder, voided by it for any reason, accepted and purchased by it hereunder, and cancelled at their respective maturities. Each Syndicated Canadian Bank agrees to provide such records to the Canadian Borrower at the Canadian Borrower’s expense upon request.

(h) Execution. Drafts drawn by the Canadian Borrower to be accepted as Bankers’ Acceptances shall be signed by a duly authorized officer or officers of the Canadian Borrower or by its attorneys, including attorneys appointed pursuant to Section 2.03(g) of this Addendum. Notwithstanding that any Person whose signature appears on any Bankers’ Acceptance may no longer be an authorized signatory for the Canadian Borrower at the time of issuance of a Bankers’ Acceptance, that signature shall nevertheless be valid and sufficient for all purposes as if the authority had remained in force at the time of issuance and any Bankers’ Acceptance so signed shall be binding on the Canadian Borrower.

(i) Issuance. The Global Administrative Agent, promptly following receipt of a notice of Syndicated Canadian Advance or Continuation/Conversion Notice in respect of Bankers’ Acceptances, shall advise the Syndicated Canadian Banks of the notice and shall advise each Syndicated Canadian Bank of the face amount of Bankers’ Acceptances to be accepted by it and the applicable Interest Period (which shall be identical for all Syndicated Canadian Banks). The aggregate face amount of Bankers’ Acceptances to be accepted by a Syndicated Canadian Bank shall be determined by the Global Administrative Agent by reference to that Syndicated Canadian Bank’s Syndicated Canadian Pro Rata Share, except that, if the face amount of a Bankers’ Acceptance which would otherwise be accepted by a Syndicated Canadian Bank would not be Cdn.$100,000, or a whole multiple thereof, the face amount shall be increased or reduced by the Global Administrative Agent in its sole discretion to Cdn.$100,000, or the nearest whole multiple of that amount, as appropriate; provided that after such issuance, no Syndicated Canadian Bank shall have outstanding Syndicated Canadian Loans in excess of such Syndicated Canadian Bank’s Syndicated Canadian Commitment outstanding immediately prior to such issuance.

(j) Waiver of Presentment and Other Conditions. The Canadian Borrower waives presentment for payment and any other defence to payment of any amounts due to a Syndicated Canadian Bank in respect of a Bankers’ Acceptance accepted and purchased by it pursuant to this Addendum which might exist solely by reason of the Bankers’ Acceptance being held, at the maturity thereof, by the Syndicated Canadian Bank in its own right and the Canadian Borrower agrees not to claim any days of grace if the Syndicated Canadian Bank as holder sues the Canadian Borrower on the Bankers’ Acceptance for payment of the amount payable by the Canadian Borrower thereunder. On the specified maturity date of a Bankers’ Acceptance or the date of any prepayment thereof in accordance with this Addendum, if

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earlier, the Canadian Borrower shall pay to the Syndicated Canadian Bank that has accepted such Bankers’ Acceptance the full face amount of such Bankers’ Acceptance and after such payment, the Canadian Borrower shall have no further liability in respect of such Bankers’ Acceptance (except to the extent that any such payment is rescinded or reclaimed by operation of law or otherwise) and such Syndicated Canadian Bank shall be entitled to all benefits of, and be responsible for all payments due to third parties under, such Bankers’ Acceptance.

(k) BA Equivalent Loans by Non BA Lenders. Whenever the Canadian Borrower requests a Bankers’ Acceptance Loan or conversion or continuation thereof under this Addendum, each Non BA Lender shall, in lieu of accepting a Bankers’ Acceptance, make a BA Equivalent Loan in an amount equal to the Non BA Lender’s Syndicated Canadian Pro Rata Share of such Bankers’ Acceptance Loan.

(l) Terms Applicable to Discount Notes. As set out in the definition of “Bankers’ Acceptances”, that term includes Discount Notes and all terms of this Addendum and the Credit Agreement applicable to Bankers’ Acceptances shall apply equally to Discount Notes evidencing BA Equivalent Loans with such changes as may in the context be necessary. For greater certainty:

(i) the term of a Discount Note shall be the same as the Interest Period for Bankers’ Acceptances accepted and purchased on the same date in respect of the same Advance;

(ii) a stamping fee will be payable by the Canadian Borrower in respect of a Discount Note and shall be calculated at the same rate and in the same manner as the Stamping Fee in respect of a Bankers’ Acceptance; and

(iii) the BA Discount Rate applicable to a Discount Note shall be the BA Discount Rate applicable to Bankers’ Acceptances accepted by the Global Administrative Agent (as Lender) on the same date, in respect of the same Advance.

(m) Stamping Fees on Bankers’ Acceptance. The Canadian Borrower shall pay, in respect of each draft accepted by the Syndicated Canadian Banks as a Bankers’ Acceptance, a per annum stamping fee (the “Stamping Fee”) equal to (1) the Applicable Margin for Eurocurrency Rate Loans and CDOR Loans, changing when and as such Applicable Margin for Eurocurrency Rate Loans and CDOR Loans shall change, multiplied by (2) the face amount of such Bankers’ Acceptance, and calculated based on the number of days to maturity of such Bankers’ Acceptance divided by 365 (or, when appropriate, 366). Such Stamping Fee shall be payable in advance on the date of issuance of the Bankers’ Acceptance. The Canadian Borrower authorizes and directs the Syndicated Canadian Banks to deduct from the Bankers’ Acceptance Proceeds of Bankers’ Acceptances purchased by such Syndicated Canadian Bank for its own account, the amount of each such Stamping Fee upon the issue of each Bankers’ Acceptance.

(n) Depository Bills and Notes Act. At the option of the Canadian Borrower and any Syndicated Canadian Bank, Bankers’ Acceptances under this Addendum to be accepted by such Syndicated Canadian Bank may be issued in the form of depository bills for deposit with The Canadian Depository for Securities Limited pursuant to the Depository Bills and Notes Act (Canada). All depository bills so issued shall be governed by the provisions of this Addendum.

(o) Circumstances Making Bankers’ Acceptances Unavailable. If the Global Administrative Agent determines in good faith, which determination shall constitute prima facie evidence

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thereof, and notifies the Canadian Borrower that, by reason of circumstances affecting the money market, there is no market for Bankers’ Acceptances, then:

(i) the right of the Canadian Borrower to request a Bankers’ Acceptance Loan (or continuation or conversion thereof) shall be suspended until the Global Administrative Agent determines that the circumstances causing such suspension no longer exist and the Administrative Agent so notifies the Canadian Borrower; and

(ii) any notice relating to a Bankers’ Acceptance Loan (or continuation or conversion thereof) which is outstanding at such time shall be deemed to be a notice requesting an Advance (or continuation or conversion thereof) by way of Canadian Prime Rate Loans.

The Global Administrative Agent shall promptly notify the Canadian Borrower and the Syndicated Canadian Banks of the suspension in accordance with this Section of the Canadian Borrower’s right to request a Bankers’ Acceptance Loan (or continuation or conversion thereof) and of the termination of any such suspension.

(p) Prepayment. The Canadian Borrower may pay the full face amount of a Bankers’ Acceptances to the Global Administrative Agent to be held by the Global Administrative Agent in a non-interest bearing account as collateral security for the Canadian Borrower’s obligations with respect to those Bankers’ Acceptances and after such payment, the Canadian Borrower shall have no further liability in respect of such Bankers’ Acceptance (except to the extent that any such payment is rescinded or reclaimed by operation of law or otherwise) and the Syndicated Canadian Bank that accepted such Bankers’ Acceptance shall be entitled to all benefits of, and be responsible for all payments due to third parties under, such Bankers’ Acceptance.

(q) Default. Immediately upon termination of the Commitments under Section 8.1(a) of the Credit Agreement, the Canadian Borrower shall pay to the Global Administrative Agent on behalf of the applicable Syndicated Canadian Banks the face amount of all Bankers’ Acceptances which have not matured, provided that, at the Global Administrative Agent’s sole discretion, such amounts may be paid to the applicable Syndicated Canadian Banks in full and absolute satisfaction of the Canadian Borrower’s reimbursement obligation in respect of such Banker’s Acceptances, or, alternatively, such amounts may be held by the Global Administrative Agent in a non-interest bearing account as collateral security for the Canadian Borrower’s obligations with respect to those Bankers’ Acceptances.

(r) Canadian Swing Line Loans. The terms of this Addendum shall apply equally to Bankers’ Acceptance Loans made by the Global Swing Line Lender except that (i) Bankers’ Acceptances Loans will consist of loans bearing interest at the CDOR Rate and not the issuance of Bankers’ Acceptances; (ii) the CDOR Rate will be the discount rate for the term of the applicable Bankers’ Acceptance Loan as quoted by the Global Swing Line Lender; (iii) interest on Bankers’ Acceptance Loans shall be payable on the last day of the applicable Interest Period and (iv) the applicable notice requirements shall be as set out in Schedule II to the Credit Agreement.

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ARTICLE 3

Representations and Warranties

SECTION 3.01. Representations of the Canadian Borrower. The Canadian Borrower party hereto makes and confirms each representation and warranty in all material respects as of each Borrowing Date applicable to the Canadian Borrower or any of its Subsidiaries contained in Article V of the Credit Agreement except for representations and warranties made with reference solely to an earlier date, which representations and warranties shall be true and correct as of such earlier date; provided, that the representations set forth in Sections 5.1.6 and 5.1.7 of the Credit Agreement shall be deemed to be made only (1) on and as of the Closing Date, (2) on and as of each date (if any) on which the Lenders agree to extend the Termination Date and (3) on and as of the effective date of any increase in the Commitments (if any) and represents and warrants to each of the Syndicated Canadian Banks that no Default or Unmatured Default has occurred and is continuing, and no Default or Unmatured Default shall arise as a result of the making of Syndicated Canadian Loans hereunder or any other transaction contemplated hereby.

ARTICLE 4

Miscellaneous Provisions

SECTION 4.01. Limitation on Criminal Rates of Interest.

(a) No Payment shall exceed Lawful Rate. Notwithstanding any other term of the Credit Agreement and this Addendum, the Canadian Borrower shall not be obliged to pay any interest or other amounts under or in connection with the Credit Agreement and this Addendum in excess of the amount or rate permitted under or consistent with any applicable law, rule or regulation. In particular, the Canadian Borrower shall not be obliged to pay any interest or other amounts which would result in the receipt by any Lender of interest on credit advanced at a rate in excess of the rate permitted under the Criminal Code (Canada). For purposes of this Section 4.01, “interest” and “credit advanced” have the meanings ascribed in the Criminal Code (Canada) and the “effective annual rate of interest” shall be calculated in accordance with generally accepted actuarial principles and practices.

(b) Payment at Highest Lawful Rate. If the Canadian Borrower is not obliged to make a payment which it would otherwise be required to make, as a result of this Section 4.01, the Canadian Borrower, as applicable, shall make such payment to the maximum extent permitted by or consistent with applicable laws, rules and regulations.

(c) Adjustment if any Payment exceeds Lawful Rate. If any provision of the Credit Agreement or this Addendum would obligate the Canadian Borrower to make any payment of interest or other amount payable to any Lender in an amount or calculated at a rate which would be prohibited by any applicable law, rule or regulation, or in the case of the Canadian Borrower, would result in a receipt by that Lender of interest at a criminal rate (as such terms are construed under the Criminal Code (Canada)), then notwithstanding such provision, such amount or rate shall be deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by law or so result in a receipt by that Lender of interest at a criminal rate, such adjustment to be effected, to the extent necessary, as follows:

firstly, by reducing the amount or rate of interest required to be paid by the Canadian Borrower to the affected Lender; and

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thereafter, by reducing any fees, commissions, premiums and other amounts required to be paid by the Canadian Borrower to the affected Lender where, in the case of the Canadian Borrower, such amounts would constitute interest for purposes of Section 347 of the Criminal Code (Canada).

Notwithstanding the foregoing, and after giving effect to all adjustments contemplated thereby, if any Lender shall have received from the Canadian Borrower an amount in excess of the maximum permitted by any applicable law, rule or regulation or in the case of the Canadian Borrower, an amount in excess of the maximum permitted under the Criminal Code (Canada), then the Canadian Borrower shall be entitled, by notice in writing to the Global Administrative Agent, to obtain reimbursement from that Lender in an amount equal to such excess, and pending such reimbursement, such amount shall be deemed to be an amount payable by that Lender to the Canadian Borrower. Any amount or rate of interest referred to in this Section 4.01 shall be determined in accordance with generally accepted actuarial practices and principles as an effective annual rate of interest over the term that any Loan remains outstanding on the assumption, with respect to Canadian Syndicated Loans, that any charges, fees or expenses that fall within the meaning of “interest” (as defined in the Criminal Code (Canada)) shall, if the relate to a specific period of time, be pro-rated over that period of time and otherwise be pro-rated over the period from the Closing Date to the Termination Date.

SECTION 4.02. Amendment; Termination.

(a) This Addendum (including the Schedules hereto) may not be amended without the prior written consent of the Canadian Borrower, the Global Administrative Agent and the Syndicated Canadian Banks representing more than 50% of the Syndicated Canadian Commitment.

(b) This Addendum may not be terminated without the prior written consent of the Global Administrative Agent and each Syndicated Canadian Bank party hereto and the Canadian Borrower unless there are no Syndicated Canadian Loans outstanding hereunder, in which case no such consent of the Syndicated Canadian Banks shall be required; provided, however, that this Addendum shall terminate on the date that the Credit Agreement terminates in accordance with its terms.

SECTION 4.03. Assignments.

Sections 13.1 and 13.3 of the Credit Agreement shall apply to assignments by the Syndicated Canadian Banks of obligations, commitments and Loans hereunder; provided, however, that the Syndicated Canadian Banks may not assign any obligations, commitments or rights hereunder to any Person who is not (and does not simultaneously become) a Lender under the Credit Agreement.

SECTION 4.04. Notices.

Notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:

(a) if to Canadian Borrower, at:

Harley-Davidson Financial Services Canada, Inc.

3700 West Juneau Avenue

Milwaukee, Wisconsin 53208

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Telephone No.: (414) 343-7863

Facsimile No.: (414) 343-4990

Attention: J. Darrell Thomas, Vice President and Treasurer

(b) if to the Global Administrative Agent in respect of matters pertaining to the Canadian Borrower and its Loans, to it at:

JPMorgan Chase Bank, N.A., Toronto Branch

200 Bay Street, 18^th Floor

Suite 1800

Toronto, Ontario

M5J 2J2

Telephone:	(416) 981-9235
Facsimile:	(416) 981-9128
Attention:	Account Manager

(c) if to any Syndicated Canadian Bank, to it at its address or telecopy number set forth in Schedule I hereto or in the Assignment and Acceptance pursuant to which such Syndicated Canadian Bank became a party hereto.

All notices and other communications given to any party hereto in accordance with the provisions of this Addendum shall be deemed to have been given on the date of receipt if delivered by hand or overnight courier service or sent by telecopy to such party as provided in this Section or in accordance with the latest unrevoked direction from such party given in accordance with this Section.

SECTION 4.05. Applicable Law.

THIS ADDENDUM SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

* * * * *

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IN WITNESS WHEREOF, the parties hereto have caused this Addendum to be duly executed by their duly authorized officers, all as of the date and year first above written.

HARLEY-DAVIDSON FINANCIAL SERVICES CANADA, INC.

as the Canadian Borrower under this Addendum

By:

Name:

Title:

Signature Page to Syndicated Canadian Addendum

JPMORGAN CHASE BANK, N.A.,

as the Global Administrative Agent

By:

Name:

Title:

JPMORGAN CHASE BANK, N.A., TORONTO BRANCH,

as a Syndicated Canadian Bank

By:

Name:

Title:

Signature Page to Syndicated Canadian Addendum

CITIBANK, N.A., CANADIAN BRANCH,

as a Syndicated Canadian Bank

By:

Name:

Title:

Signature Page to Syndicated Canadian Addendum

U.S. BANK NATIONAL ASSOCIATION,

as a Syndicated Canadian Bank

By:

Name:

Title:

Signature Page to Syndicated Canadian Addendum

BMO HARRIS BANK N.A.,

as a Syndicated Canadian Bank

By:

Name:

Title:

Signature Page to Syndicated Canadian Addendum

FIFTH THIRD BANK,

as a Syndicated Canadian Bank

By:

Name:

Title:

Signature Page to Syndicated Canadian Addendum

THE TORONTO-DOMINION BANK,

as a Syndicated Canadian Bank

By:

Name:

Title:

Signature Page to Syndicated Canadian Addendum

SCHEDULE I

to Syndicated Canadian Addendum

for Canadian Borrower

SYNDICATED CANADIAN BANK

SYNDICATED CANADIAN COMMITMENT

Syndicated Canadian Bank	Dollar Amount of Syndicated Canadian Commitment
JPMorgan Chase Bank, N.A., Toronto Branch		U.S.$ 55,000,000
Citibank, N.A., Canadian Branch		U.S.$ 55,000,000
U.S. Bank National Association, Canada Branch		U.S.$ 50,000,000
BMO Harris Bank N.A.		U.S.$ 50,000,000
Fifth Third Bank		U.S.$ 20,000,000
The Toronto-Dominion Bank		U.S.$ 20,000,000
Aggregate Syndicated Canadian Commitment		U.S.$ 250,000,000

SCHEDULE II

to Syndicated Canadian Addendum

for Canadian Borrower

MODIFICATIONS

1. Business Day Definition:

“Business Day” shall mean a day (other than a Saturday or Sunday) on which banks are open for business in Toronto, Canada.

2. Interest Payment Dates:

Interest shall be payable on each Canadian Prime Rate Loan on the last Business Day of each calendar month.

3. Interest Periods: Same as Credit Agreement.

4. Interest Rates: Same as Credit Agreement.

5. Modifications to Interest Period Selection and Conversion Contained in Section 2.8: Same as Credit Agreement except as noted below:

Any Conversion of a Bankers’ Acceptance Loan shall be made on, and only on, the maturity date applicable thereto. In the event that a Bankers’ Acceptance Loan is to be continued as a Bankers’ Acceptance Loan, the Bankers’ Acceptance Proceeds arising from the continued Bankers’ Acceptance Loan shall be retained by the relevant Syndicated Canadian Bank to be applied by it to the face amount of the Bankers’ Acceptance maturing on the date of such advance, and the Canadian Borrower shall pay to each Syndicated Canadian Bank, on such date, an amount equal to the difference between the face amount at maturity of the maturing Bankers’ Acceptance and the Bankers’ Acceptance Proceeds of the Bankers’ Acceptance to be issued. Notwithstanding anything to the contrary contained in the Credit Agreement or this Addendum, no Loan may be converted into or continued as a Bankers’ Acceptance Loan when any Default or Unmatured Default has occurred and is continuing.

6. Other:

Additional Conditions Precedent: None.

Termination Date for Addendum: Same as Credit Agreement.

Maximum Number of Interest Periods: Same as Credit Agreement.

Prepayments and related Notices: The Canadian Borrower shall be permitted to prepay the Syndicated Canadian Loans (other than Bankers’ Acceptance Loans) provided that notice thereof is given to the Global Administrative Agent not later than 10:00 a.m. (Toronto time) at least one (1) Business Day prior to the date of such prepayment.

If at any time any Bankers’ Acceptances are to be paid prior to their maturity, the Canadian Borrower shall be required to deposit the amount of such prepayment in a cash collateral account with the Global

Administrative Agent until the date of maturity of such Bankers’ Acceptances. Such cash collateral account shall be under the sole dominion and control of the Global Administrative Agent. Except as contemplated hereby, neither the Canadian Borrower nor any Person claiming on behalf of the Canadian Borrower shall have any right to any of the cash in such cash collateral account. The Global Administrative Agent shall apply the cash held in such cash collateral account to the face amount of such Bankers’ Acceptances at maturity whereupon any cash remaining in such cash collateral account shall be released by the Global Administrative Agent to the Canadian Borrower.

SCHEDULE III

to Syndicated Canadian Addendum

for Canadian Borrower

OTHER PROVISIONS

1. Borrowing Procedures: Same as Credit Agreement, except as noted below:

Notice of Borrowing of (i) Bankers’ Acceptance Loans, (ii) conversion of outstanding Canadian Prime Rate Loans into Bankers’ Acceptances, and (iii) renewal of Bankers’ Acceptance Loan (which renewals) shall be in the same form of Loan) shall be given by the Canadian Borrower to the Global Administrative Agent not later than the time specified in Schedule II to the Credit Agreement. Such notice shall also state the term applicable to such Bankers’ Acceptance.

2. Funding Arrangements: Same as Credit Agreement.

3. Promissory Notes: If requested by any Syndicated Canadian Bank.

SCHEDULE IV

to Syndicated Canadian Addendum

for Canadian Borrower

Form of Syndicated Canadian Note

                     , 20     

Harley-Davidson Financial Services Canada, Inc., a corporation organized under the laws of Canada (the “Canadian Borrower”), promises to pay to the order of [                    ] (the “Syndicated Canadian Bank”) the aggregate unpaid principal Dollar Amount of all Syndicated Canadian Loans made by the Syndicated Canadian Bank to the Canadian Borrower pursuant to Article II of the Credit Agreement hereinafter referred to (together with the Syndicated Canadian Addendum, as each of the same may be amended, restated, supplemented or otherwise modified from time to time, the “Agreement”; capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement), in immediately available funds on the dates and at the offices of JPMorgan Chase Bank, N.A., as Global Administrative Agent, specified in the Agreement, together with interest on the unpaid principal amount hereof at the rates and on the dates determined in accordance with the Agreement. The Canadian Borrower shall pay the principal of and accrued and unpaid interest on the Syndicated Canadian Loans in full on the Termination Date (unless an earlier termination date shall be specified in or pursuant to the Syndicated Canadian Addendum).

The Syndicated Canadian Bank shall, and is hereby authorized to, record on the schedule attached hereto, or otherwise record in accordance with its usual practice, the date and amount of each Syndicated Canadian Loan and the date and amount of each principal payment hereunder.

This Note is one of the Syndicated Canadian Notes issued pursuant to, and is entitled to the benefits of, the 5-Year Credit Agreement dated as of April 13, 2012 entered into among the Canadian Borrower, Harley-Davidson, Inc., a Wisconsin corporation, Harley-Davidson Funding Corp., a Nevada corporation, Harley-Davidson Financial Services, Inc., a Delaware corporation, Harley-Davidson Financial Services International Inc., a Delaware corporation, Harley-Davidson Credit Corp., a Nevada corporation and JPMorgan Chase Bank, N.A., as the Global Administrative Agent and the Global Swing Line Lender and the institutions from time to time party thereto as Lenders, including the Syndicated Canadian Bank, to which Agreement, as it may be amended from time to time, reference is hereby made for a statement of the terms and conditions governing this Syndicated Canadian Note, including the terms and conditions under which this Syndicated Canadian Note may be prepaid or its maturity date accelerated. The Agreement, among other things, provides for the making of “Syndicated Canadian Loans” by the Syndicated Canadian Bank to the Canadian Borrower from time to time in an aggregate amount not to exceed at any time outstanding the Syndicated Canadian Bank’s Commitment, except as otherwise contemplated in the Agreement.

Except as otherwise provided in the Agreement, the Canadian Borrower hereby waives presentment, demand, protest and notice of any kind. No failure to exercise, and no delay in exercising, any rights hereunder on the part of the holder hereof shall operate as a waiver of such rights.

THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

HARLEY-DAVIDSON FINANCIAL SERVICES CANADA, INC.

By:

Name:

Title:

Schedule of Syndicated Canadian Loans and Payments of Principal

to

Syndicated Canadian Note of Harley-Davidson Financial Services Canada, Inc.

Dated                     , 20    

Date Principal amount and currency of Syndicated Loan Maturity of Interest Period Principal Amount
Paid Unpaid Balance

EXHIBIT F

TO

CREDIT AGREEMENT

Commitment and Acceptance

Dated                     , 20    

Reference is made to that certain 5-Year Credit Agreement (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) dated as of April 13, 2012 entered into among Harley-Davidson, Inc., a Wisconsin corporation, Harley-Davidson Funding Corp., a Nevada corporation, Harley-Davidson Financial Services, Inc., a Delaware corporation, Harley-Davidson Financial Services Canada, Inc., a company organized and existing under the laws of Canada, Harley-Davidson Financial Services International, Inc., a Delaware corporation, Harley-Davidson Credit Corp., a Nevada corporation, the institutions from time to time a party thereto (the “Lenders”) and JPMorgan Chase Bank, N.A., as the Global Administrative Agent and the Global Swing Line Lender. Terms defined in the Credit Agreement are used herein with the same meaning.

Pursuant to Section 2.4 of the Credit Agreement, Harley has requested an increase in the Aggregate Commitment from $            to $            . Such increase in the Aggregate Commitment is to become effective on the date (the “Effective Date”) which is the later of (i)                     , 20            and (ii) the date on which the conditions precedent set forth in Section 2.4(b)(i) in respect of such increase have been satisfied. In connection with such requested increase in the Aggregate Commitment, Harley, the Global Administrative Agent and                      (the “Accepting Bank”) hereby agree as follows:

1. Effective as of the Effective Date, [the Accepting Bank shall become a party to the Credit Agreement as a Lender and shall have all of the rights and obligations of a Lender thereunder and shall thereupon have a Commitment under and for purposes of the Credit Agreement in an amount equal to the] [the Commitment of the Accepting Bank under the Credit Agreement shall be increased from $            to the] amount set forth opposite the Accepting Bank’s name on the signature page hereof.

[2. The Accepting Bank hereby (i) confirms that it has received a copy of the Credit Agreement, together with copies of the financial statements and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Commitment and Acceptance Agreement; (ii) agrees that it will, independently and without reliance upon the Global Administrative Agent or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (iii) appoints and authorizes the Global Administrative Agent to take such action as contractual representative on its behalf and to exercise such powers under the Credit Agreement and the other Loan Documents as are delegated to the Global Administrative Agent by the terms thereof, together with such powers as are reasonably incidental thereto; and (iv) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender.]

F-1

[3.] Harley hereby represents and warrants that as of the date hereof and as of the Effective Date, (a) all representations and warranties contained in Article V of the Credit Agreement shall be true and correct in all material respects as though made on such date (unless such representation and warranty is made as of a specific date, in which case such representation and warranty shall be true and correct as of such date) and (b) no event shall have occurred and then be continuing which constitutes a Default or an Unmatured Default.

[4.] THIS COMMITMENT AND ACCEPTANCE AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

[5.] This Commitment and Acceptance Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Commitment and Acceptance Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.

	HARLEY-DAVIDSON, INC.
	By:
	Name:
	Title:
	JPMORGAN CHASE BANK, N.A., as Global Administrative Agent
	By:
	Name:
	Title:
COMMITMENT:	ACCEPTING BANK:
$[            ]	[                    ]
	By:
	Name:
	Title:

F-2

EX-10.1

Exhibit 10.1

HARLEY-DAVIDSON, INC.

Director Compensation Policy

Effective April 28, 2012

This compensation policy has been developed to compensate non-employee directors (“Directors”) of Harley-Davidson, Inc. (the “Company”) for their time, commitment and contributions to the Board of Directors (the “Board”) of the Company. It is expected that Directors will attend all meetings of the Board and of its Committees.

I. Annual Retainer Fee for Non-Employee Directors

Annual Retainer Fee for Non-Employee Directors	$	100,000
Annual Retainer Fee for the Presiding Director of the Board of Directors		25,000
Annual Retainer Fee for Audit Committee Chair		20,000
Annual Retainer Fee for Committee Chairs (other than the Audit Committee Chair)		10,000
Annual Retainer Fee for Audit Committee Members		5,000

Annual Retainer Fees paid to Directors of the Board will be paid within ten (10) business days after the first business day following the annual meeting of the shareholders of the Company (“Annual Meeting”). In the event a Director is elected to the Board at a time other than at the Annual Meeting, the Annual Retainer Fee will be prorated on a quarterly basis based on the quarter a Director is elected to the Board and paid within ten (10) business days after the first business day after the Director’s first Board or committee meeting.

Directors will be eligible to elect to receive Annual Retainer Fees in cash or Company Common Stock (based upon the fair market value of the Common Stock on the first business day after the Annual Meeting or the first business day after the Director’s first Board or committee meeting) and to defer all Annual Retainer Fees paid in cash or Company Common Stock pursuant to plans adopted by the Company from time to time. Directors must receive a minimum of one-half ( ¹/2) of their Annual Retainer Fees in Company Common Stock until the Director reaches the stock ownership goals established in the Director and Senior Executive Stock Ownership Guidelines for Harley-Davidson, Inc.

II. Annual Grants to Non-Employee Directors

Directors will receive an annual grant of share units, each representing the value of one share of Company Common Stock, pursuant to plans adopted by the Company from time to time. A new director who joins the Board other than at the time of an annual meeting will also receive a grant of share units. Payment will be deferred until a director ceases to serve as a director and will then be made in stock.

III. Additional Compensation for and Payments to Non-Employee Directors

Clothing Allowance. Each Director shall receive an annual clothing allowance of $1,500 to purchase Harley-Davidson MotorClothes^® apparel and accessories.

Discount on Company Products. Each Director shall receive the same discount on Company products that is available to all Company employees.

Expenses. The Company will reimburse reasonable travel and related business expenses that a Director incurs for attendance at all meetings of the Board and committees and in connection with other Board of Directors or Company business.

Motorcycle Usage. Management may provide a Director with the use of a motorcycle where doing so may further a Company business objective.

EX-31.1

Exhibit 31.1

Chief Executive Officer Certification

Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934

I, Keith E. Wandell, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Harley-Davidson, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 10, 2012	/s/ Keith E. Wandell
	Keith E. Wandell
	Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Chief Financial Officer Certification

Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934

I, John A. Olin, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Harley-Davidson, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth quarter in case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors:

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 10, 2012	/s/ John A. Olin
	John A. Olin
	Senior Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

Written Statement of the Chief Executive Officer and Chief Financial Officer

Pursuant to 18 U.S.C. sec. 1350

Solely for the purpose of complying with 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, we, the undersigned Chairman, President and Chief Executive Officer and the Senior Vice President and Chief Financial Officer of Harley-Davidson, Inc. (the “Company”), hereby certify, based on our knowledge, that the Quarterly Report on Form 10-Q of the Company for the quarter ended April 1, 2012 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 10, 2012	/s/ Keith E. Wandell
	Keith E. Wandell
	Chairman, President and Chief Executive Officer
	/s/ John A. Olin
	John A. Olin
	Senior Vice President and Chief Financial Officer

XML

Discontinued Operations (Details)	3 Months Ended			12 Months Ended
	Apr. 01, 2012 USD ($)	Dec. 31, 2011 USD ($)	Mar. 27, 2011 USD ($)	Dec. 31, 2010 USD ($)	Dec. 31, 2009 USD ($)	Aug. 06, 2010 EUR (€)
Discontinued Operations [Abstract]
Pre-tax impairment charges					$ 115,400,000
Net tax benefit, related to losses estimated in connection with sale					40,000,000
Total tax benefit associated with losses on sale				101,000,000	66,000,000
Uncertain tax benefit reserved against losses estimated in connection with sale of MV				43,500,000	26,000,000
Impairment charges included in operating loss				111,800,000
Additional tax benefits on impairment charges				18,000,000
Advances to affiliate						20,000,000
Cumulative net tax benefit				57,500,000
Tax benefit by reversing reserve		43,500,000
Incremental tax benefit	$ 1,296,000	$ 7,500,000	$ 7,757,000

XML

Fair Value Measurements (Summary Of Assets And Liabilities Measured At Fair Value On A Recurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	$ 997,669	$ 1,302,367	$ 593,344
Marketable securities	134,946	153,380	115,209
Derivatives, assets	6,345	16,443	18
Total assets measured at fair value	1,138,960	1,472,190	708,571
Derivatives, liabilities	2,234	5,136	24,787
Quoted Prices In Active Markets For Identical Assets (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents	997,669	1,302,367	593,344
Marketable securities			59,977
Total assets measured at fair value	997,669	1,302,367	653,321
Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	134,946	153,380	55,232
Derivatives, assets	6,345	16,443	18
Total assets measured at fair value	141,291	169,823	55,250
Derivatives, liabilities	2,234	5,136	24,787
Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash equivalents
Marketable securities
Derivatives, assets
Total assets measured at fair value
Derivatives, liabilities

XML

Finance Receivables (Finance Receivables That Are Individually Deemed To Be Impaired) (Details) (Wholesale [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 27, 2011
Financing Receivable, Impaired [Line Items]
Recorded Investment	$ 5,187
Unpaid Principal Balance	5,037
Related Allowance	3,451
Average Recorded Investment	5,527
Interest Income Recognized
No Related Allowance Recorded [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment
Unpaid Principal Balance
Related Allowance
Average Recorded Investment
Interest Income Recognized
Related Allowance Recorded [Member]
Financing Receivable, Impaired [Line Items]
Recorded Investment	5,187
Unpaid Principal Balance	5,037
Related Allowance	3,451
Average Recorded Investment	5,527
Interest Income Recognized

XML

Subsequent Event (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Apr. 01, 2012
Five-Year Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of credit facility, initiation date	April 13, 2012
Line of credit facility, maximum borrowing capacity	$ 675.0
Three-Year Facility [Member]
Line of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity	$ 675.0
Line of credit facility, maturity date	Apr. 01, 2013

XML

Fair Value Of Financial Instruments (Summary Of The Fair Value And Carrying Value Of The Company's Financial Instruments) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011	Dec. 31, 2010
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	$ 1,276,337	$ 1,526,950	$ 932,515	$ 1,021,933
Marketable securities	134,946	153,380	115,209
Accounts receivable, net	264,272	219,039	297,671
Restricted cash held by variable interest entities	246,995	229,655	294,903
Fair Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	1,276,337	1,526,950	932,515
Marketable securities	134,946	153,380	115,209
Accounts receivable, net	264,272	219,039	297,671
Derivatives	6,345	16,443	18
Finance receivables, net	5,961,825	5,888,040	6,105,350
Restricted cash held by variable interest entities	246,995	229,655	294,903
Accounts payable	355,902	255,713	292,676
Derivatives	2,234	5,136	24,787
Unsecured commercial paper	662,343	874,286	488,493
Credit facilities	150,195	159,794	217,651
Medium-term notes	2,936,475	2,561,458	2,514,092
Senior unsecured notes	366,651	376,513	406,961
Term asset-backed securitization debt	1,768,140	2,099,060	2,366,270
Carrying Value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	1,276,337	1,526,950	932,515
Marketable securities	134,946	153,380	115,209
Accounts receivable, net	264,272	219,039	297,671
Derivatives	6,345	16,443	18
Finance receivables, net	5,877,403	5,786,681	6,025,423
Restricted cash held by variable interest entities	246,995	229,655	294,903
Accounts payable	355,902	255,713	292,676
Derivatives	2,234	5,136	24,787
Unsecured commercial paper	662,343	874,286	488,493
Credit facilities	150,195	159,794	217,651
Medium-term notes	2,698,232	2,298,193	2,347,624
Senior unsecured notes	303,000	303,000	303,000
Term asset-backed securitization debt	$ 1,754,320	$ 2,087,346	$ 2,324,763

XML

Finance Receivables (Changes In The Allowance For Credit Losses On Finance Receivables) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Changes In The Allowance For Credit Losses On Finance Receivables [Line Items]
Balance, beginning of period	$ 125,449	$ 173,589
Provision for credit losses	9,014	5,606
Charge-offs	(25,852)	(35,191)
Recoveries	13,892	15,680
Balance, end of period	122,503	159,684
Retail [Member]
Changes In The Allowance For Credit Losses On Finance Receivables [Line Items]
Balance, beginning of period	116,112	157,791
Provision for credit losses	8,705	3,439
Charge-offs	(25,852)	(35,191)
Recoveries	13,892	15,665
Balance, end of period	112,857	141,704
Wholesale [Member]
Changes In The Allowance For Credit Losses On Finance Receivables [Line Items]
Balance, beginning of period	9,337	15,798
Provision for credit losses	309	2,167
Recoveries		15
Balance, end of period	$ 9,646	$ 17,980

XML

Employee Benefit Plans (Tables)

3 Months Ended

Apr. 01, 2012

Employee Benefit Plans [Abstract]

Components Of Net Periodic Benefit Costs

	Three months ended
	April 1, 2012			March 27, 2011
Pension and SERPA Benefits
Service cost	$	8,420		$	9,273
Interest cost		20,816			20,147
Expected return on plan assets		(29,277	)		(26,653	)
Amortization of unrecognized:
Prior service cost		740			745
Net loss		10,969			7,554
Curtailment loss		—			236
Net periodic benefit cost	$	11,668		$	11,302
Postretirement Healthcare Benefits
Service cost	$	1,853		$	1,907
Interest cost		4,578			4,911
Expected return on plan assets		(2,356	)		(2,346	)
Amortization of unrecognized:
Prior service credit		(963	)		(969	)
Net loss		1,855			1,798
Net periodic benefit cost	$	4,967		$	5,301

XML

Derivative Instruments And Hedging Activities (Gain (Loss) On Derivative Cash Flow Hedges Recognized In OCI) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Derivative Instruments And Hedging Activities [Line Items]
Amount of Gain/(Loss) Recognized in OCI	$ (6,545)	$ (10,206)
Foreign Currency Contracts [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of (Loss) Recognized in OCI	(6,215)	(10,161)
Natural Gas Contracts [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of (Loss) Recognized in OCI	(315)	(37)
Interest Rate Swaps - Unsecured Commercial Paper [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of (Loss) Recognized in OCI	$ (15)	$ (8)

XML

Restructuring Expense (Tables)

3 Months Ended

Apr. 01, 2012

2011 Restructuring Plan [Member]

Restructuring Cost and Reserve [Line Items]

Restructuring Plan Reserve Recorded In Accrued Liabilities

		00000000			00000000			00000000			00000000			00000000			00000000			00000000			00000000
	Three months ended April 1, 2012
	Kansas City									New Castalloy												Consolidated
	Employee									Employee
	Severance and									Severance and
	Termination									Termination			Accelerated
	Costs			Other			Total			Costs			Depreciation			Other			Total			Total
Balance, beginning of period	$	4,123		$	—		$	4,123		$	8,428		$	—		$	305		$	8,733		$	12,856
Restructuring expense		542			—			542			571			2,099			349			3,019			3,561
Utilized—cash		—			—			—			(156	)		—			(361	)		(517	)		(517	)
Utilized—noncash		—			—			—			—			(2,099	)		—			(2,099	)		(2,099	)
Balance, end of period	$	4,665		$	—		$	4,665		$	8,843		$	—		$	293		$	9,136		$	13,801
	Three months ended March 27, 2011
	Kansas City
	Employee
	Severance and
	Termination
	Costs			Other			Total
Restructuring expense		6,382			134			6,516
Utilized—cash		—			(134	)		(134	)
Utilized—noncash		(236	)		—			(236	)
Balance, end of period	$	6,146		$	—		$	6,146

2010 Restructuring Plan [Member]

Restructuring Cost and Reserve [Line Items]

Restructuring Plan Reserve Recorded In Accrued Liabilities

	Three months ended April 1, 2012			Three months ended March 27, 2011
	Employee Severance and Termination Costs			Employee Severance and Termination Costs
Balance, beginning of period	$	20,361		$	8,652
Restructuring expense		1,886			3,144
Utilized - cash		(26	)		(594	)
Balance, end of period	$	22,221		$	11,202

2009 Restructuring Plan [Member]

Restructuring Cost and Reserve [Line Items]

Summary Of Restructuring Plan Reserve Activity

	Three months ended April 1, 2012
	Motorcycles & Related Products
	Employee Severance and Termination Costs			Accelerated Depreciation		Other			Total
Balance, beginning of period	$	10,089		$	—	$	—		$	10,089
Restructuring expense		323			—		5,681			6,004
Utilized - cash		(1,846	)		—		(5,669	)		(7,515	)
Utilized - noncash		—			—		—			—
Balance, end of period	$	8,566		$	—	$	12		$	8,578
	Three months ended March 27, 2011
	Motorcycles & Related Products
	Employee Severance and Termination Costs			Accelerated Depreciation		Other			Total
Balance, beginning of period	$	23,818		$	—	$	2,764		$	26,582
Restructuring expense		2,954			—		10,385			13,339
Utilized - cash		(4,028	)		—		(10,546	)		(14,574	)
Utilized - noncash		—			—		296			296
Balance, beginning of period	$	22,744		$	—	$	2,899		$	25,643

XML

Finance Receivables (Recorded Investment Of Retail Finance Receivables By Credit Quality Indicator) (Details) (Retail [Member], USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	$ 5,043,584	$ 5,087,490	$ 5,225,155
Prime [Member]
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	4,056,602	4,097,048	4,185,825
Sub-Prime [Member]
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	$ 986,982	$ 990,442	$ 1,039,330

XML

Restructuring Expense (Restructuring Plan Reserve Recorded In Accrued Liabilities Related To The 2010 Plan) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Restructuring Cost and Reserve [Line Items]
Restructuring expense	$ 11,451	$ 22,999
2010 Restructuring Plan [Member] | Employee Severance And Termination Costs [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	20,361	8,652
Restructuring expense	1,886	3,144
Utilized - cash	(26)	(594)
Balance, end of period	$ 22,221	$ 11,202

XML

Additional Balance Sheet And Cash Flow Information (Inventories, Net) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011
Additional Balance Sheet And Cash Flow Information [Abstract]
Raw materials and work in process	$ 113,127	$ 113,932	$ 99,538
Motorcycle finished goods	252,979	226,261	187,687
Parts and accessories and general merchandise	145,362	121,340	119,134
Inventory at lower of FIFO cost or market	511,468	461,533	406,359
Excess of FIFO over LIFO cost	(43,527)	(43,527)	(34,036)
Inventories, net	$ 467,941	$ 418,006	$ 372,323

XML

Asset-Backed Financing (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
SPEs [Member]
Asset Backed Financing [Line Items]
Secured notes' contractual maturity period, start	2012
Secured notes' contractual maturity period, end	2018
SPE Facility [Member] | Commercial Paper [Member]
Asset Backed Financing [Line Items]
Asset-backed securities expiration date	September 7, 2012
Total aggregate commitment	$ 600.0
Borrowings outstanding under conduit facility	$ 0	$ 0

XML

Supplemental Consolidating Data (Operations) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Segment Reporting Information [Line Items]
Motorcycles and related products	$ 1,273,369	$ 1,063,044
Financial services	156,322	161,886
Total revenue	1,429,691	1,224,930
Motorcycles and related products cost of goods sold	816,859	711,178
Financial services interest expense	51,256	58,035
Financial services provision for credit losses	9,014	5,606
Selling, administrative and engineering expense	265,653	234,115
Restructuring expense	11,451	22,999
Total costs and expenses	1,154,233	1,031,933
Operating income	275,458	192,997
Investment income	1,933	1,398
Interest expense	11,495	11,481
Income before provision for income taxes	265,896	182,914
Provision for income taxes	93,861	63,654
Income from continuing operations	172,035	119,260
Loss from discontinued operations, net of tax
Net income	172,035	119,260
Motorcycles & Related Products Operations [Member]
Segment Reporting Information [Line Items]
Motorcycles and related products	1,275,783	1,065,490
Total revenue	1,275,783	1,065,490
Motorcycles and related products cost of goods sold	816,859	711,178
Selling, administrative and engineering expense	236,579	203,671
Restructuring expense	11,451	22,999
Total costs and expenses	1,064,889	937,848
Operating income	210,894	127,642
Investment income	226,933	126,398
Interest expense	11,495	11,481
Income before provision for income taxes	426,332	242,559
Provision for income taxes	70,618	40,126
Income from continuing operations	355,714	202,433
Net income	355,714	202,433
Financial Services Operations [Member]
Segment Reporting Information [Line Items]
Financial services	155,906	161,752
Total revenue	155,906	161,752
Financial services interest expense	51,256	58,035
Financial services provision for credit losses	9,014	5,606
Selling, administrative and engineering expense	31,072	32,756
Total costs and expenses	91,342	96,397
Operating income	64,564	65,355
Income before provision for income taxes	64,564	65,355
Provision for income taxes	23,243	23,528
Income from continuing operations	41,321	41,827
Net income	41,321	41,827
Eliminations & Adjustments [Member]
Segment Reporting Information [Line Items]
Motorcycles and related products	(2,414)	(2,446)
Financial services	416	134
Total revenue	(1,998)	(2,312)
Selling, administrative and engineering expense	(1,998)	(2,312)
Total costs and expenses	(1,998)	(2,312)
Investment income	(225,000)	(125,000)
Income before provision for income taxes	(225,000)	(125,000)
Income from continuing operations	(225,000)	(125,000)
Net income	$ (225,000)	$ (125,000)

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Product Warranty And Safety Recall Campaigns (Warranty And Safety Recall Liability) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Product Warranty And Safety Recall Campaigns [Abstract]
Balance, beginning of period	$ 54,994	$ 54,134
Warranties issued during the period	14,912	11,225
Settlements made during the period	(13,958)	(10,296)
Recalls and changes to pre-existing warranty liabilities	1,154	2,048
Balance, end of period	$ 57,102	$ 57,111

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Finance Receivables (Allowance For Credit Losses And Finance Receivables By Portfolio Individually And Collectively Evaluated For Impairment) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011	Dec. 31, 2010
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses	$ 122,503	$ 125,449	$ 159,684	$ 173,589
Finance receivables, gross	5,999,906	5,912,130	6,185,107
Retail [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses	112,857	116,112	141,704	157,791
Finance receivables, gross	5,043,584	5,087,490	5,225,155
Wholesale [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses	9,646	9,337	17,980	15,798
Finance receivables, gross	956,322	824,640	959,952
Individually Evaluated For Impairment [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses			3,451
Finance receivables, gross			5,187
Individually Evaluated For Impairment [Member] | Retail [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses
Finance receivables, gross
Individually Evaluated For Impairment [Member] | Wholesale [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses			3,451
Finance receivables, gross			5,187
Collectively Evaluated For Impairment [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses	122,503	125,449	156,233
Finance receivables, gross	5,999,906	5,912,130	6,179,920
Collectively Evaluated For Impairment [Member] | Retail [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses	112,857	116,112	141,704
Finance receivables, gross	5,043,584	5,087,490	5,225,155
Collectively Evaluated For Impairment [Member] | Wholesale [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for credit losses	9,646	9,337	14,529
Finance receivables, gross	$ 956,322	$ 824,640	$ 954,765

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Discontinued Operations

3 Months Ended

Apr. 01, 2012

Discontinued Operations [Abstract]

Discontinued Operations

4. Discontinued Operations

In October 2009, the Company unveiled a new business strategy to drive growth through a focus of efforts and resources on the unique strengths of the Harley-Davidson brand and to enhance productivity and profitability through continuous improvement. The Company's Board of Directors approved and the Company committed to the divestiture of MV as part of this strategy. The Company engaged a third party investment bank to assist with the marketing and sale of MV. During 2009, the Company recorded pre-tax impairment charges of $115.4 million related to MV and a net tax benefit of $40 million related to losses estimated in connection with the sale of MV. As of December 31, 2009, the Company estimated the total tax benefit associated with losses related to the sale of MV to be $66 million of which $26 million was deemed uncertain and appropriately reserved against.

At each subsequent reporting date in 2010 through the date of sale of MV in August 2010, the fair value less selling costs was re-assessed and additional impairment charges totaling $111.8 million and additional tax benefits totaling $18 million were recognized in 2010. As the effort to sell MV progressed into 2010, adverse factors led to decreases in the fair value of MV. During 2010, challenging economic conditions continued to persist, negatively impacting the appetite of prospective buyers and the motorcycle industry as a whole. Information coming directly from the selling process, including discussions with the prospective buyers, indicated a fair value that was less than previously estimated.

On August 6, 2010, the Company concluded its sale of MV to MV Augusta Motor Holding S.r.l., a company controlled by the former owner of MV. Under the agreement relating to the sale, (1) the Company received nominal consideration in return for the transfer of MV and related assets; (2) the parties waived their respective rights under the stock purchase agreement and other documents related to the Company's purchase of MV in 2008, which included a waiver of the former owner's right to contingent earn-out consideration; and (3) the Company contributed 20.0 million Euros to MV as operating capital. The 20.0 million Euros contributed were factored into the Company's estimate of MV's fair value prior to the sale and was recognized in the 2010 impairment charges discussed above. As a result of the impairment charges recorded in 2009 and 2010 prior to the sale, the Company only incurred an immaterial loss on the date of sale, which was included in the loss from discontinued operations, net of tax, during the year ended December 31, 2010.

As of December 31, 2010, the Company's estimated total tax benefit associated with the loss on the sale of MV was $101.0 million, of which $43.5 million was deemed uncertain and appropriately reserved against. As a result, the total cumulative net tax benefit recognized as of December 31, 2010 was $57.5 million. The increase in the estimated tax benefit during 2010 was driven by an increase in the losses related to the sale of MV, not a change in the tax position.

In determining the tax benefit recognized from October 2009 through December 2010, the Company engaged appropriate technical expertise and considered all relevant available information. In accordance with ASC 740, "Income Taxes," at each balance sheet date during this period, the Company re-evaluated the overall tax benefit, determined that it was at least more likely than not that it would be sustained upon review and calculated the amount of recognized tax benefit based on a cumulative probability basis.

Beginning in 2010, the Company voluntarily elected to participate in a pre-filing agreement process with the Internal Revenue Service (IRS) in order to accelerate their review of the Company's tax position related to MV. The IRS effectively completed its review in late 2011 and executed a Closing Agreement on Final Determination Covering Specific Matters with the Company.

There were no changes to the Company's estimated gross or recognized tax benefit associated with the loss on the sale of MV during the first three quarters of 2011. In the fourth quarter of 2011, given the outcome of the closing agreement, the Company recognized a $43.5 million tax benefit by reversing the reserve recorded as of September 25, 2011 and recognized an incremental $7.5 million tax benefit related to the final calculation of the tax basis in the loan to and the stock of MV.

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Earnings Per Share (Reconciliation Of Earnings Per Share Basic And Diluted) (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Earnings Per Share [Abstract]
Income from continuing operations used in computing basic and diluted earnings per share	$ 172,035	$ 119,260
Denominator for basic earnings per share- weighted-average common shares	228,988,000	233,820,000
Effect of dilutive securities - employee stock compensation plan	2,296,000	2,083,000
Denominator for diluted earnings per share- adjusted weighted-average shares outstanding	231,284,000	235,903,000
Basic	$ 0.75	$ 0.51
Diluted	$ 0.74	$ 0.51
Shares considered anti-dilutive and excluded from computation	2,400,000	3,300,000

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Restructuring Expense (Summary Of Restructuring Plan Reserve Activity Related To The 2009 Plan) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Restructuring Cost and Reserve [Line Items]
Restructuring expense	$ 11,451	$ 22,999
2009 Restructuring Plan [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	10,089	26,582
Restructuring expense	6,004	13,339
Utilized - cash	(7,515)	(14,574)
Utilized - noncash		296
Balance, end of period	8,578	25,643
2009 Restructuring Plan [Member] | Motorcycles & Related Products [Member] | Employee Severance And Termination Costs [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	10,089	23,818
Restructuring expense	323	2,954
Utilized - cash	(1,846)	(4,028)
Utilized - noncash
Balance, end of period	8,566	22,744
2009 Restructuring Plan [Member] | Motorcycles & Related Products [Member] | Accelerated Depreciation [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period
Restructuring expense
Utilized - cash
Utilized - noncash
Balance, end of period
2009 Restructuring Plan [Member] | Motorcycles & Related Products [Member] | Other [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period		2,764
Restructuring expense	5,681	10,385
Utilized - cash	(5,669)	(10,546)
Utilized - noncash		296
Balance, end of period	$ 12	$ 2,899

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Fair Value Of Financial Instruments (Tables)

3 Months Ended

Apr. 01, 2012

Fair Value Of Financial Instruments [Abstract]

Summary Of The Fair Value And Carrying Value Of The Company's Financial Instruments

	April 1, 2012				December 31, 2011				March 27, 2011
	Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value
Assets:
Cash and cash equivalents	$	1,276,337	$	1,276,337	$	1,526,950	$	1,526,950	$	932,515	$	932,515
Marketable securities	$	134,946	$	134,946	$	153,380	$	153,380	$	115,209	$	115,209
Accounts receivable, net	$	264,272	$	264,272	$	219,039	$	219,039	$	297,671	$	297,671
Derivatives	$	6,345	$	6,345	$	16,443	$	16,443	$	18	$	18
Finance receivables, net	$	5,961,825	$	5,877,403	$	5,888,040	$	5,786,681	$	6,105,350	$	6,025,423
Restricted cash held by variable interest entities	$	246,995	$	246,995	$	229,655	$	229,655	$	294,903	$	294,903
Liabilities:
Accounts payable	$	355,902	$	355,902	$	255,713	$	255,713	$	292,676	$	292,676
Derivatives	$	2,234	$	2,234	$	5,136	$	5,136	$	24,787	$	24,787
Unsecured commercial paper	$	662,343	$	662,343	$	874,286	$	874,286	$	488,493	$	488,493
Credit facilities	$	150,195	$	150,195	$	159,794	$	159,794	$	217,651	$	217,651
Medium-term notes	$	2,936,475	$	2,698,232	$	2,561,458	$	2,298,193	$	2,514,092	$	2,347,624
Senior unsecured notes	$	366,651	$	303,000	$	376,513	$	303,000	$	406,961	$	303,000
Term asset-backed securitization debt	$	1,768,140	$	1,754,320	$	2,099,060	$	2,087,346	$	2,366,270	$	2,324,763

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Fair Value Measurements (Tables)

3 Months Ended

Apr. 01, 2012

Fair Value Measurements [Abstract]

Summary Of Assets And Liabilities Measured At Fair Value On A Recurring Basis

April 1, 2012
	Balance as of April 1, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	997,669	$	997,669	$	—	$	—
Marketable securities		134,946		—		134,946		—
Derivatives		6,345		—		6,345		—
	$	1,138,960	$	997,669	$	141,291	$	—
Liabilities:
Derivatives	$	2,234	$	—	$	2,234	$	—

	December 31, 2011
	Balance as of December 31, 2011		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	1,302,367	$	1,302,367	$	—	$	—
Marketable securities		153,380		—		153,380		—
Derivatives		16,443		—		16,443		—
	$	1,472,190	$	1,302,367	$	169,823	$	—
Liabilities:
Derivatives	$	5,136	$	—	$	5,136	$	—

	March 27, 2011
	Balance as of March 27, 2011		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	593,344	$	593,344	$	—	$	—
Marketable securities		115,209		59,977		55,232		—
Derivatives		18		—		18		—
	$	708,571	$	653,321	$	55,250	$	—
Liabilities:
Derivatives	$	24,787	$	—	$	24,787	$	—

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Derivative Instruments And Hedging Activities (Schedule Of Derivative Instrument Fair Value) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012		Dec. 31, 2011		Mar. 27, 2011
Derivatives, Fair Value [Line Items]
Maximum maturity period of foreign currency and natural gas contracts (in years)	one
Derivatives Designated As Hedging Instruments [Member]
Derivatives, Fair Value [Line Items]
Notional Value	$ 315,502		$ 412,465		$ 429,620
Asset Fair Value	6,345	[1]	16,443	[1]
Liability Fair Value	2,234	[2]	5,137	[2]	24,769	[2]
Derivatives Designated As Hedging Instruments [Member] | Foreign Currency Contracts [Member]
Derivatives, Fair Value [Line Items]
Notional Value	219,484	[3]	306,450	[3]	300,455	[3]
Asset Fair Value	6,345	[1],[3]	16,443	[1],[3]
Liability Fair Value			1,852	[2],[3]	18,675	[2],[3]
Derivatives Designated As Hedging Instruments [Member] | Natural Gas Contracts [Member]
Derivatives, Fair Value [Line Items]
Notional Value	918	[3]	3,915	[3]	3,165	[3]
Liability Fair Value	262	[2],[3]	265	[2],[3]	26	[2],[3]
Derivatives Designated As Hedging Instruments [Member] | Interest Rate Swaps - Unsecured Commercial Paper [Member]
Derivatives, Fair Value [Line Items]
Notional Value	95,100	[3]	102,100	[3]	126,000	[3]
Liability Fair Value	1,972	[2],[3]	3,020	[2],[3]	6,068	[2],[3]
Derivatives Not Designated As Hedging Instruments [Member]
Derivatives, Fair Value [Line Items]
Notional Value					17,723
Asset Fair Value					18	[1]
Liability Fair Value					18	[2]
Derivatives Not Designated As Hedging Instruments [Member] | Derivatives - Securitization Transactions [Member]
Derivatives, Fair Value [Line Items]
Notional Value					17,723
Asset Fair Value					18	[1]
Liability Fair Value					$ 18	[2]

[1] Included in other current assets

[2] Included in accrued liabilities

[3] Derivative designated as a cash flow hedge

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Finance Receivables (Narrative) (Details) (USD $)	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011	Dec. 31, 2011	Apr. 01, 2012 Retail [Member]	Dec. 31, 2011 Retail [Member]	Mar. 27, 2011 Retail [Member]	Dec. 31, 2010 Retail [Member]	Apr. 01, 2012 Wholesale [Member]	Dec. 31, 2011 Wholesale [Member]	Mar. 27, 2011 Wholesale [Member]	Apr. 01, 2012 Related To Finance Receivables Held By VIEs [Member]	Mar. 27, 2011 Related To Finance Receivables Held By VIEs [Member]	Apr. 01, 2012 Greater Than 90 Days Past Due [Member] Retail [Member]	Dec. 31, 2011 Greater Than 90 Days Past Due [Member] Retail [Member]	Mar. 27, 2011 Greater Than 90 Days Past Due [Member] Retail [Member]	Apr. 01, 2012 Greater Than 90 Days Past Due [Member] Wholesale [Member]	Dec. 31, 2011 Greater Than 90 Days Past Due [Member] Wholesale [Member]	Mar. 27, 2011 Greater Than 90 Days Past Due [Member] Wholesale [Member]
Financing Receivables [Line Items]
Restricted finance receivables held as collateral	$ 2,520,000,000	$ 2,940,000,000	$ 2,860,000,000
Recorded Investment										5,187,000
FICO score for determining credit risk	640
Allowance for credit losses				112,857,000	116,112,000	141,704,000	157,791,000				57,000,000	82,300,000
Retail financing receivables, gross				5,043,584,000	5,087,490,000	5,225,155,000							16,262,000	27,469,000	25,123,000
Wholesale finance receivables, gross								956,322,000	824,640,000	959,952,000						326,000	909,000	2,698,000
Non-accrual status wholesale finance receivables		$ 5,200,000

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Derivative Instruments And Hedging Activities (Tables)

3 Months Ended

Apr. 01, 2012

Derivative Instruments And Hedging Activities [Abstract]

Schedule Of Derivative Instrument Fair Value

	April 1, 2012						December 31, 2011						March 27, 2011
Derivatives Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Foreign currency contracts(c)	$	219,484	$	6,345	$	—	$	306,450	$	16,443	$	1,852	$	300,455	$	—	$	18,675
Natural gas contracts(c)		918		—		262		3,915		—		265		3,165		—		26
Interest rate swaps—unsecured commercial paper(c)		95,100		—		1,972		102,100		—		3,020		126,000		—		6,068
Total	$	315,502	$	6,345	$	2,234	$	412,465	$	16,443	$	5,137	$	429,620	$	—	$	24,769

	April 1, 2012						December 31, 2011						March 27, 2011
Derivatives Not Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Derivatives - securitization transactions	$	—	$	—	$	—	$	—	$	—	$	—	$	17,723	$	18	$	18
	$	—	$	—	$	—	$	—	$	—	$	—	$	17,723	$	18	$	18

(a) Included in other current assets

(b) Included in accrued liabilities

(c) Derivative designated as a cash flow hedge

Gain (Loss) On Derivative Cash Flow Hedges Recognized In OCI

	Amount of Gain/(Loss) Recognized in OCI
	Three months ended
Cash Flow Hedges	April 1, 2012			March 27, 2011
Foreign currency contracts	$	(6,215	)	$	(10,161	)
Natural gas contracts		(315	)		(37	)
Interest rate swaps—unsecured commercial paper		(15	)		(8	)
Total	$	(6,545	)	$	(10,206	)

Gain (Loss) On Derivative Cash Flow Hedges Reclassified From AOCI Into Income

	Amount of Gain/(Loss) Reclassified from AOCI into Income
	Three months ended						Expected to be Reclassified
Cash Flow Hedges	April 1, 2012			March 27, 2011			Over the Next Twelve Months
Foreign currency contracts(a)	$	2,421		$	(6,007	)	$	(4,535	)
Natural gas contracts(a)		(318	)		(258	)		262
Interest rate swaps—unsecured commercial paper(b)		(967	)		(1,350	)		(1,886	)
Total	$	1,136		$	(7,615	)	$	(6,159	)

(a) Gain/(loss) reclassified from accumulated other comprehensive income (AOCI) to income is included in cost of goods sold.

(b) Gain/(loss) reclassified from AOCI to income is included in financial services interest expense.

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Product Warranty And Safety Recall Campaigns (Tables)

3 Months Ended

Apr. 01, 2012

Product Warranty And Safety Recall Campaigns [Abstract]

Warranty And Safety Recall Liability

	Three months ended
	April 1, 2012			March 27, 2011
Balance, beginning of period	$	54,994		$	54,134
Warranties issued during the period		14,912			11,225
Settlements made during the period		(13,958	)		(10,296	)
Recalls and changes to pre-existing warranty liabilities		1,154			2,048
Balance, end of period	$	57,102		$	57,111

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Additional Balance Sheet And Cash Flow Information

3 Months Ended

Apr. 01, 2012

Additional Balance Sheet And Cash Flow Information [Abstract]

Additional Balance Sheet And Cash Flow Information

3. Additional Balance Sheet and Cash Flow Information

Marketable Securities

The Company's marketable securities consisted of the following (in thousands):

	April 1, 2012		December 31, 2011		March 27, 2011
Available-for-sale:
Corporate bonds	$	134,946	$	153,380	$	55,232
U.S. Treasuries		—		—		59,977
	$	134,946	$	153,380	$	115,209

The Company's available-for-sale securities are carried at fair value with any unrealized gains or losses reported in other comprehensive income. During the first three months of 2012 and 2011, the Company recognized gross unrealized gains in other comprehensive income of $1.6 million and $0.1 million, respectively, or $1.0 million and $0.04 million net of taxes, respectively, to adjust amortized cost to fair value. The marketable securities have contractual maturities that generally come due over the next 12 to 48 months.

Inventories

Inventories are valued at the lower of cost or market. Substantially all inventories located in the United States are valued using the last-in, first-out (LIFO) method. Other inventories are valued at the lower of cost or market using the first-in, first-out (FIFO) method. Inventories consist of the following (in thousands):

	April 1, 2012			December 31, 2011			March 27, 2011
Components at the lower of FIFO cost or market
Raw materials and work in process	$	113,127		$	113,932		$	99,538
Motorcycle finished goods		252,979			226,261			187,687
Parts and accessories and general merchandise		145,362			121,340			119,134
Inventory at lower of FIFO cost or market		511,468			461,533			406,359
Excess of FIFO over LIFO cost		(43,527	)		(43,527	)		(34,036	)
	$	467,941		$	418,006		$	372,323

Operating Cash Flow

The reconciliation of net income to net cash used by operating activities is as follows (in thousands):

	Three months ended
	April 1, 2012			March 27, 2011
Cash flows from operating activities:
Net income	$	172,035		$	119,260
Loss from discontinued operations		—			—
Income from continuing operations		172,035			119,260
Adjustments to reconcile income from continuing operations to net cash used by operating activities:
Depreciation		43,203			42,947
Amortization of deferred loan origination costs		18,547			19,329
Amortization of financing origination fees		2,743			3,107
Provision for employee long-term benefits		17,293			15,563
Contributions to pension and postretirement plans		(206,832	)		(204,816	)
Stock compensation expense		11,744			9,153
Net change in wholesale finance receivables related to sales		(151,046	)		(163,967	)
Provision for credit losses		9,014			5,606
Pension and postretirement healthcare plan curtailment and settlement expense		—			236
Foreign currency adjustments		(2,911	)		29
Other, net		1,505			14,112
Changes in current assets and liabilities:
Accounts receivable, net		(43,745	)		(27,048	)
Finance receivables - accrued interest and other		3,299			3,542
Inventories		(47,168	)		(38,200	)
Accounts payable and accrued liabilities		117,460			98,960
Restructuring reserves		1,296			7,757
Derivative instruments		(486	)		2,157
Other		(19,567	)		(12,645	)
Total adjustments		(245,651	)		(224,178	)
Net cash used by operating activities of continuing operations	$	(73,616	)	$	(104,918	)

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Earnings Per Share (Tables)

3 Months Ended

Apr. 01, 2012

Earnings Per Share [Abstract]

Reconciliation Of Earnings Per Share Basic And Diluted

	Three months ended
	April 1, 2012		March 27, 2011
Numerator:
Income from continuing operations used in computing basic and diluted earnings per share	$	172,035	$	119,260
Denominator:
Denominator for basic earnings per share- weighted-average common shares		228,988		233,820
Effect of dilutive securities—employee stock compensation plan		2,296		2,083
Denominator for diluted earnings per share- adjusted weighted-average shares outstanding		231,284		235,903
Earnings per common share from continuing operations:
Basic	$	0.75	$	0.51
Diluted	$	0.74	$	0.51

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Restructuring Expense (Narrative) (Details) (USD $)	1 Months Ended		3 Months Ended
	Feb. 28, 2011	Sep. 30, 2010	Apr. 01, 2012	Mar. 27, 2011
Restructuring Cost and Reserve [Line Items]
Restructuring expense			$ 11,451,000	$ 22,999,000
Labor agreement period (in years)	7	7
2011 Restructuring Plan [Member]
Restructuring Cost and Reserve [Line Items]
Estimated restructuring expense			15,000,000
Estimated percentage of restructuring charges that will be non-cash			10.00%
Incurred restructuring and impairment expenses			500,000
2011 Restructuring Plan [Member] | Kansas City Facility [Member]
Restructuring Cost and Reserve [Line Items]
Non-cash restructuring expense				200,000
Less employees: required under existing contract			145
2010 Restructuring Plan [Member]
Restructuring Cost and Reserve [Line Items]
Estimated restructuring expense			67,000,000
Estimated percentage of restructuring charges that will be non-cash			42.00%
Cumulative restructuring and impairment expenses			61,500,000
Incurred restructuring and impairment expenses			4,500,000
2010 Restructuring Plan [Member] | Milwaukee Facilities [Member]
Restructuring Cost and Reserve [Line Items]
Less employees: required under existing contract			250
2010 Restructuring Plan [Member] | Tomahawk Facilities [Member]
Restructuring Cost and Reserve [Line Items]
Less employees: required under existing contract			75
2009 Restructuring Plan [Member]
Restructuring Cost and Reserve [Line Items]
Restructuring expense			6,004,000	13,339,000
Non-cash restructuring expense				(296,000)
Estimated percentage of restructuring charges that will be non-cash			30.00%
Restructuring and impairment expenses, minimum			388,000,000
Restructuring and impairment expenses, maximum			408,000,000
Cumulative restructuring and impairment expenses			386,600,000
Incurred restructuring and impairment expenses			3,300,000
Reduction in hourly production positions, minimum			2,700
Reduction in hourly production positions, maximum			2,900
Employees who have left the Company due to restructuring			3,600
Employee severance costs			2,700,000
2009 Restructuring Plan [Member] | Motorcycles [Member]
Restructuring Cost and Reserve [Line Items]
Estimated reduction in salaried positions from restructuring			720
2009 Restructuring Plan [Member] | Financial Services [Member]
Restructuring Cost and Reserve [Line Items]
Estimated reduction in salaried positions from restructuring			100
2011 Kansas City Restructuring Plan [Member]
Restructuring Cost and Reserve [Line Items]
Cumulative restructuring and impairment expenses			9,300,000
2011 New Castalloy Restructuring Plan [Member]
Restructuring Cost and Reserve [Line Items]
Estimated reduction in workforce			200
Estimated restructuring expense			30,000,000
Non-cash restructuring expense			30,000,000
Estimated percentage of restructuring charges that will be non-cash			35.00%
Cumulative restructuring and impairment expenses			12,400,000
Incurred restructuring and impairment expenses			$ 3,000,000

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Asset-Backed Financing (Schedule Of Assets And Liabilities Of Variable Interest Entities) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011
SPEs [Member]
Asset Backed Financing [Line Items]
Finance receivables	$ 2,564,585	$ 2,916,219	$ 3,000,580
Allowance for credit losses	(56,810)	(65,735)	(81,631)
Restricted cash	245,912	228,776	293,090
Other assets	5,620	6,772	10,499
Total assets	2,759,307	3,086,032	3,222,538
Term asset-backed securitization debt	1,754,320	2,087,346	2,324,763
SPE Facility [Member]
Asset Backed Financing [Line Items]
Finance receivables	10,689	13,455	23,776
Allowance for credit losses	(236)	(302)	(645)
Restricted cash	1,083	879	1,813
Other assets	312	449	598
Total assets	$ 11,848	$ 14,481	$ 25,542

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Condensed Consolidated Statements Of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Revenue:
Motorcycles and related products	$ 1,273,369	$ 1,063,044
Financial services	156,322	161,886
Total revenue	1,429,691	1,224,930
Costs and expenses:
Motorcycles and related products cost of goods sold	816,859	711,178
Financial services interest expense	51,256	58,035
Financial services provision for credit losses	9,014	5,606
Selling, administrative and engineering expense	265,653	234,115
Restructuring expense	11,451	22,999
Total costs and expenses	1,154,233	1,031,933
Operating income	275,458	192,997
Investment income	1,933	1,398
Interest expense	11,495	11,481
Income before provision for income taxes	265,896	182,914
Provision for income taxes	93,861	63,654
Income from continuing operations	172,035	119,260
Loss from discontinued operations, net of tax
Net income	$ 172,035	$ 119,260
Earnings per common share from continuing operations:
Basic	$ 0.75	$ 0.51
Diluted	$ 0.74	$ 0.51
Loss per common share from discontinued operations:
Basic
Diluted
Earnings per common share:
Basic	$ 0.75	$ 0.51
Diluted	$ 0.74	$ 0.51
Cash dividends per common share	$ 0.155	$ 0.10

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Finance Receivables (Finance Receivables) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011	Dec. 31, 2010
Accounts, Notes, Loans and Financing Receivable [Line Items]
Finance receivables, gross	$ 5,999,906	$ 5,912,130	$ 6,185,107
Allowance for credit losses	(122,503)	(125,449)	(159,684)	(173,589)
Finance receivables, net	5,877,403	5,786,681	6,025,423
Retail [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Finance receivables, gross	5,043,584	5,087,490	5,225,155
Wholesale [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Finance receivables, gross	$ 956,322	$ 824,640	$ 959,952

XML

Basis Of Presentation And Use Of Estimates

3 Months Ended

Apr. 01, 2012

Basis Of Presentation And Use Of Estimates [Abstract]

Basis Of Presentation And Use Of Estimates

1. Basis of Presentation and Use of Estimates

The condensed consolidated financial statements include the accounts of Harley-Davidson, Inc. and its wholly-owned subsidiaries (the Company), including the accounts of the group of companies doing business as Harley-Davidson Motor Company (HDMC) and Harley-Davidson Financial Services (HDFS). In addition, certain variable interest entities (VIEs) related to secured financing are consolidated as the Company is the primary beneficiary. All intercompany accounts and material intercompany transactions are eliminated.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the condensed consolidated balance sheets as of April 1, 2012 and March 27, 2011, the condensed consolidated statements of operations for the three month periods then ended, the condensed consolidated statements of comprehensive income for the three month periods then ended and the condensed consolidated statements of cash flows for the three month periods then ended.

Certain information and footnote disclosures normally included in complete financial statements have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (SEC) and U.S. generally accepted accounting principles (U.S. GAAP) for interim financial reporting. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes included in the Company's Annual Report on Form 10-K for the year ended December 31, 2011.

The Company operates in two business segments: Motorcycles & Related Products (Motorcycles) and Financial Services (Financial Services).

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and the accompanying notes. Actual results could differ from those estimates.

During 2008, the Company acquired Italian motorcycle manufacturer MV Agusta (MV). On October 15, 2009, the Company announced its intent to divest MV, and the Company completed the sale on August 6, 2010. MV is presented as a discontinued operation for all periods.

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Income Taxes (Details)	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Income Taxes [Abstract]
Income tax rate	35.30%	34.80%

XML

Supplemental Consolidating Data (Tables)

3 Months Ended

Apr. 01, 2012

Supplemental Consolidating Data [Abstract]

Operations

	Three months ended April 1, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,275,783	$	—	$	(2,414	)	$	1,273,369
Financial services		—		155,906		416			156,322
Total revenue		1,275,783		155,906		(1,998	)		1,429,691
Costs and expenses:
Motorcycles and related products cost of goods sold		816,859		—		—			816,859
Financial services interest expense		—		51,256		—			51,256
Financial services provision for credit losses		—		9,014		—			9,014
Selling, administrative and engineering expense		236,579		31,072		(1,998	)		265,653
Restructuring expense		11,451		—		—			11,451
Total costs and expenses		1,064,889		91,342		(1,998	)		1,154,233
Operating income		210,894		64,564		—			275,458
Investment income		226,933		—		(225,000	)		1,933
Interest expense		11,495		—		—			11,495
Income before provision for income taxes		426,332		64,564		(225,000	)		265,896
Provision for income taxes		70,618		23,243		—			93,861
Income from continuing operations		355,714		41,321		(225,000	)		172,035
Loss from discontinued operations, net of tax		—		—		—			—
Net income	$	355,714	$	41,321	$	(225,000	)	$	172,035

	Three months ended March 27, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,065,490	$	—	$	(2,446	)	$	1,063,044
Financial services		—		161,752		134			161,886
Total revenue		1,065,490		161,752		(2,312	)		1,224,930
Costs and expenses:
Motorcycles and related products cost of goods sold		711,178		—		—			711,178
Financial services interest expense		—		58,035		—			58,035
Financial services provision for credit losses		—		5,606		—			5,606
Selling, administrative and engineering expense		203,671		32,756		(2,312	)		234,115
Restructuring expense		22,999		—		—			22,999
Total costs and expenses		937,848		96,397		(2,312	)		1,031,933
Operating income		127,642		65,355		—			192,997
Investment income		126,398		—		(125,000	)		1,398
Interest expense		11,481		—		—			11,481
Income before provision for income taxes		242,559		65,355		(125,000	)		182,914
Provision for income taxes		40,126		23,528		—			63,654
Income from continuing operations		202,433		41,827		(125,000	)		119,260
Loss from discontinued operations, net of tax		—		—		—			—
Net income	$	202,433	$	41,827	$	(125,000	)	$	119,260

Balance Sheet

	April 1, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	929,028	$	347,309	$	—		$	1,276,337
Marketable securities		134,946		—		—			134,946
Accounts receivable, net		581,569		—		(317,297	)		264,272
Finance receivables, net		—		1,339,139		—			1,339,139
Restricted finance receivables held by variable interest entities, net		—		546,350		—			546,350
Inventories		467,941		—		—			467,941
Restricted cash held by variable interest entities		—		246,995		—			246,995
Other current assets		174,053		63,497		—			237,550
Total current assets		2,287,537		2,543,290		(317,297	)		4,513,530
Finance receivables, net		—		2,020,036		—			2,020,036
Restricted finance receivables held by variable interest entities, net		—		1,971,878		—			1,971,878
Property, plant and equipment, net		761,191		29,873		—			791,064
Goodwill		29,740		—		—			29,740
Other long-term assets		336,167		15,970		(73,038	)		279,099
	$	3,414,635	$	6,581,047	$	(390,335	)	$	9,605,347
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	280,738	$	392,461	$	(317,297	)	$	355,902
Accrued liabilities		478,227		102,722		(3,330	)		577,619
Short-term debt		—		629,143		—			629,143
Current portion of long-term debt		—		399,939					399,939
Current portion of long-term debt held by variable interest entities		—		620,624		—			620,624
Total current liabilities		758,965		2,144,889		(320,627	)		2,583,227
Long-term debt		303,000		2,481,688		—			2,784,688
Long-term debt held by variable interest entities		—		1,133,696		—			1,133,696
Pension liability		118,212		—		—			118,212
Postretirement healthcare benefits		265,871		—		—			265,871
Other long-term liabilities		130,278		14,716		—			144,994
Commitments and contingencies (Note 16)
Total shareholders' equity		1,838,309		806,058		(69,708	)		2,574,659
	$	3,414,635	$	6,581,047	$	(390,335	)	$	9,605,347

	December 31, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	943,330	$	583,620	$	—		$	1,526,950
Marketable securities		153,380		—		—			153,380
Accounts receivable, net		393,615		—		(174,576	)		219,039
Finance receivables, net		—		1,168,603		—			1,168,603
Restricted finance receivables held by variable interest entities, net		—		591,864		—			591,864
Inventories		418,006		—		—			418,006
Restricted cash held by variable interest entities		—		229,655		—			229,655
Other current assets		167,423		67,286		—			234,709
Total current assets		2,075,754		2,641,028		(174,576	)		4,542,206
Finance receivables, net		—		1,754,441		—			1,754,441
Restricted finance receivables held by variable interest entities, net		—		2,271,773		—			2,271,773
Property, plant and equipment, net		779,330		30,129		—			809,459
Goodwill		29,081		—		—			29,081
Other long-term assets		322,379		17,460		(72,635	)		267,204
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	220,957	$	209,332	$	(174,576	)	$	255,713
Accrued liabilities		482,838		85,038		(3,704	)		564,172
Short-term debt		—		838,486		—			838,486
Current portion of long-term debt		—		399,916					399,916
Current portion of long-term debt held by variable interest entities		—		640,331		—			640,331
Total current liabilities		703,795		2,173,103		(178,280	)		2,698,618
Long-term debt		303,000		2,093,871		—			2,396,871
Long-term debt held by variable interest entities		—		1,447,015		—			1,447,015
Pension liability		302,483		—		—			302,483
Postretirement healthcare benefits		268,582		—		—			268,582
Other long-term liabilities		126,036		14,303		—			140,339
Commitments and contingencies (Note 16)
Total shareholders' equity		1,502,648		986,539		(68,931	)		2,420,256
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164

	March 27, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	663,026	$	269,489	$	—		$	932,515
Marketable securities		115,209		—		—			115,209
Accounts receivable, net		630,437		—		(332,766	)		297,671
Finance receivables, net		—		1,276,780		—			1,276,780
Restricted finance receivables held by variable interest entities, net		—		637,760		—			637,760
Inventories		372,323		—		—			372,323
Restricted cash held by variable interest entities		—		294,903		—			294,903
Other current assets		172,062		71,365		—			243,427
Total current assets		1,953,057		2,550,297		(332,766	)		4,170,588
Finance receivables, net		—		1,806,563		—			1,806,563
Restricted finance receivables held by variable interest entities, net		—		2,304,320		—			2,304,320
Property, plant and equipment, net		769,480		29,611		—			799,091
Goodwill		30,988		—		—			30,988
Other long-term assets		336,759		26,701		(69,868	)		293,592
	$	3,090,284	$	6,717,492	$	(402,634	)	$	9,405,142
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	246,746	$	378,696	$	(332,766	)	$	292,676
Accrued liabilities		493,896		89,253		(3,066	)		580,083
Short-term debt		—		393,393		—			393,393
Current portion of long-term debt held by variable interest entities		—		721,179		—			721,179
Total current liabilities		740,642		1,582,521		(335,832	)		1,987,331
Long-term debt		303,000		2,660,375		—			2,963,375
Long-term debt held by variable interest entities		—		1,603,584		—			1,603,584
Pension liability		99,627		—		—			99,627
Postretirement healthcare liability		254,505		—		—			254,505
Other long-term liabilities		145,739		10,733		—			156,472
Commitments and contingencies (Note 16)
Total shareholders' equity		1,546,771		860,279		(66,802	)		2,340,248
	$	3,090,284	$	6,717,492	$	(402,634	)	$	9,405,142

Cash Flows

	Three months ended April 1, 2012
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Income from continuing operations	$	355,714		$	41,321		$	(225,000	)	$	172,035
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation		41,708			1,495			—			43,203
Amortization of deferred loan origination costs		—			18,547			—			18,547
Amortization of financing origination fees		118			2,625			—			2,743
Provision for employee long-term benefits		16,780			513			—			17,293
Contributions to pension and postretirement plans		(206,832	)		—			—			(206,832	)
Stock compensation expense		10,967			777			—			11,744
Net change in wholesale finance receivables		—			—			(151,046	)		(151,046	)
Provision for credit losses		—			9,014			—			9,014
Pension and postretirement healthcare plan curtailment and settlement expense		—			—			—			—
Foreign currency adjustments		(2,911	)		—			—			(2,911	)
Other, net		(1,954	)		3,459			—			1,505
Change in current assets and current liabilities:
Accounts receivable		(186,466	)		—			142,721			(43,745	)
Finance receivables - accrued interest and other		—			3,299			—			3,299
Inventories		(47,168	)		—			—			(47,168	)
Accounts payable and accrued liabilities		57,993			202,188			(142,721	)		117,460
Restructuring reserves		1,296			—			—			1,296
Derivative instruments		(390	)		(96	)		—			(486	)
Other		(18,058	)		(1,509	)		—			(19,567	)
Total adjustments		(334,917	)		240,312			(151,046	)		(245,651	)
Net cash provided by operating activities of continuing operations		20,797			281,633			(376,046	)		(73,616	)
Cash flows from investing activities of continuing operations:
Capital expenditures		(23,441	)		(1,239	)		—			(24,680	)
Origination of finance receivables		—			(1,617,867	)		972,620			(645,247	)
Collections of finance receivables		—			1,503,478			(821,574	)		681,904
Sales and redemptions of marketable securities		20,042			—			—			20,042
Net cash (used by) provided by investing activities of continuing operations		(3,399	)		(115,628	)		151,046			32,019
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		—			397,377			—			397,377
Repayments of securitization debt		—			(333,026	)		—			(333,026	)
Net borrowings of unsecured commercial paper		—			(211,669	)		—			(211,669	)
Net decrease in credit facilities		—			(12,839	)		—			(12,839	)
Net change in restricted cash		—			(17,340	)		—			(17,340	)
Dividends paid		(35,943	)		(225,000	)		225,000			(35,943	)
Purchase of common stock for treasury		(20,745	)		—			—			(20,745	)
Excess tax benefits from share based payments		7,962			—			—			7,962
Issuance of common stock under employee stock option plans		16,281			—			—			16,281
Net cash used by financing activities of continuing operations		(32,445	)		(402,497	)		225,000			(209,942	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		745			181			—			926
Net (decrease) increase in cash and cash equivalents of continuing operations		(14,302	)		(236,311	)		—			(250,613	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		—			—			—			—
Cash flows from investing activities of discontinued operations		—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—			—			—
		—			—			—			—
Net (decrease) increase in cash and cash equivalents	$	(14,302	)	$	(236,311	)	$	—		$	(250,613	)
Cash and cash equivalents:
Cash and cash equivalents - beginning of period	$	943,330		$	583,620		$	—		$	1,526,950
Cash and cash equivalents of discontinued operations - beginning of period		—			—			—			—
Net (decrease) increase in cash and cash equivalents		(14,302	)		(236,311	)		—			(250,613	)
Less: Cash and cash equivalents of discontinued operations - end of period		—			—			—			—
Cash and cash equivalents - end of period	$	929,028		$	347,309		$	—		$	1,276,337

	Three months ended March 27, 2011
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Income from continuing operations	$	202,433		$	41,827		$	(125,000	)	$	119,260
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation		41,340			1,607			—			42,947
Amortization of deferred loan origination costs		—			19,329			—			19,329
Amortization of financing origination fees		118			2,989			—			3,107
Provision for employee long-term benefits		16,445			(882	)		—			15,563
Contributions to pension and postretirement plans		(204,816	)		—			—			(204,816	)
Stock compensation expense		8,481			672			—			9,153
Net change in wholesale finance receivables		—			—			(163,967	)		(163,967	)
Provision for credit losses		—			5,606			—			5,606
Pension and postretirement healthcare plan curtailment and settlement expense		236			—			—			236
Foreign currency adjustments		29			—			—			29
Other, net		1,884			12,228			—			14,112
Change in current assets and current liabilities:
Accounts receivable		(167,885	)		—			140,837			(27,048	)
Finance receivables - accrued interest and other		—			3,542			—			3,542
Inventories		(38,200	)		—			—			(38,200	)
Accounts payable and accrued liabilities		39,517			152,692			(93,249	)		98,960
Restructuring reserves		7,757			—			—			7,757
Derivative instruments		2,178			(21	)		—			2,157
Other		(12,706	)		47,636			(47,575	)		(12,645	)
Total adjustments		(305,622	)		245,398			(163,954	)		(224,178	)
Net cash (used by) provided by operating activities of continuing operations		(103,189	)		287,225			(288,954	)		(104,918	)
Cash flows from investing activities of continuing operations:
Capital expenditures		(26,460	)		(1,244	)		—			(27,704	)
Origination of finance receivables		—			(1,406,139	)		856,939			(549,200	)
Collections of finance receivables		—			1,369,924			(692,972	)		676,952
Purchases of marketable securities		(5,000	)		—			—			(5,000	)
Sales and redemptions of marketable securities		29,974			—			—			29,974
Net cash (used by) provided by investing activities of continuing operations		(1,486	)		(37,459	)		163,967			125,022
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		—			447,076			—			447,076
Repayments of securitization debt		—			(430,471	)		—			(430,471	)
Net decrease in credit facilities and unsecured commercial paper		—			(96,174	)		—			(96,174	)
Net change in restricted cash		—			(6,016	)		—			(6,016	)
Dividends paid		(23,643	)		(125,000	)		125,000			(23,643	)
Purchase of common stock for treasury		(4,699	)		—			—			(4,699	)
Excess tax benefits from share based payments		3,262			—			—			3,262
Issuance of common stock under employee stock option plans		3,861			—			—			3,861
Net cash used by financing activities of continuing operations		(21,219	)		(210,585	)		125,000			(106,804	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		(2,846	)		166			(13	)		(2,693	)
Net (decrease) increase in cash and cash equivalents of continuing operations		(128,740	)		39,347			—			(89,393	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		(25	)		—			—			(25	)
Cash flows from investing activities of discontinued operations		—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—			—			—
		(25	)		—			—			(25	)
Net (decrease) increase in cash and cash equivalents	$	(128,765	)	$	39,347		$	—		$	(89,418	)
Cash and cash equivalents:
Cash and cash equivalents - beginning of period	$	791,791		$	230,142		$	—		$	1,021,933
Cash and cash equivalents of discontinued operations - beginning of period		—			—			—			—
Net (decrease) increase in cash and cash equivalents		(128,765	)		39,347			—			(89,418	)
Less: Cash and cash equivalents of discontinued operations - end of period		—			—			—			—
Cash and cash equivalents - end of period	$	663,026		$	269,489		$	—		$	932,515

XML

Business Segments (Information By Strategic Business Units) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Segment Reporting Information, by Segment [Line Items]
Motorcycles net revenue	$ 1,273,369	$ 1,063,044
Restructuring expense	11,451	22,999
Financial services income	156,322	161,886
Operating income	275,458	192,997
Motorcycles [Member]
Segment Reporting Information, by Segment [Line Items]
Motorcycles net revenue	1,273,369	1,063,044
Gross profit	456,510	351,866
Selling, administrative and engineering expense	236,995	203,805
Restructuring expense	11,451	22,999
Operating income	208,064	125,062
Financial Services [Member]
Segment Reporting Information, by Segment [Line Items]
Financial services income	156,322	161,886
Financial services expense	88,928	93,951
Operating income	$ 67,394	$ 67,935

XML

Supplemental Consolidating Data

3 Months Ended

Apr. 01, 2012

Supplemental Consolidating Data [Abstract]

Supplemental Consolidating Data

17. Supplemental Consolidating Data

The supplemental consolidating data for the periods noted is presented for informational purposes. The supplemental consolidating data may be different than segment information presented elsewhere due to the allocation of intercompany eliminations to reporting segments. All supplemental data is presented in thousands.

	Three months ended April 1, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,275,783	$	—	$	(2,414	)	$	1,273,369
Financial services		—		155,906		416			156,322
Total revenue		1,275,783		155,906		(1,998	)		1,429,691
Costs and expenses:
Motorcycles and related products cost of goods sold		816,859		—		—			816,859
Financial services interest expense		—		51,256		—			51,256
Financial services provision for credit losses		—		9,014		—			9,014
Selling, administrative and engineering expense		236,579		31,072		(1,998	)		265,653
Restructuring expense		11,451		—		—			11,451
Total costs and expenses		1,064,889		91,342		(1,998	)		1,154,233
Operating income		210,894		64,564		—			275,458
Investment income		226,933		—		(225,000	)		1,933
Interest expense		11,495		—		—			11,495
Income before provision for income taxes		426,332		64,564		(225,000	)		265,896
Provision for income taxes		70,618		23,243		—			93,861
Income from continuing operations		355,714		41,321		(225,000	)		172,035
Loss from discontinued operations, net of tax		—		—		—			—
Net income	$	355,714	$	41,321	$	(225,000	)	$	172,035

	Three months ended March 27, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
Revenue:
Motorcycles and related products	$	1,065,490	$	—	$	(2,446	)	$	1,063,044
Financial services		—		161,752		134			161,886
Total revenue		1,065,490		161,752		(2,312	)		1,224,930
Costs and expenses:
Motorcycles and related products cost of goods sold		711,178		—		—			711,178
Financial services interest expense		—		58,035		—			58,035
Financial services provision for credit losses		—		5,606		—			5,606
Selling, administrative and engineering expense		203,671		32,756		(2,312	)		234,115
Restructuring expense		22,999		—		—			22,999
Total costs and expenses		937,848		96,397		(2,312	)		1,031,933
Operating income		127,642		65,355		—			192,997
Investment income		126,398		—		(125,000	)		1,398
Interest expense		11,481		—		—			11,481
Income before provision for income taxes		242,559		65,355		(125,000	)		182,914
Provision for income taxes		40,126		23,528		—			63,654
Income from continuing operations		202,433		41,827		(125,000	)		119,260
Loss from discontinued operations, net of tax		—		—		—			—
Net income	$	202,433	$	41,827	$	(125,000	)	$	119,260

	April 1, 2012
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	929,028	$	347,309	$	—		$	1,276,337
Marketable securities		134,946		—		—			134,946
Accounts receivable, net		581,569		—		(317,297	)		264,272
Finance receivables, net		—		1,339,139		—			1,339,139
Restricted finance receivables held by variable interest entities, net		—		546,350		—			546,350
Inventories		467,941		—		—			467,941
Restricted cash held by variable interest entities		—		246,995		—			246,995
Other current assets		174,053		63,497		—			237,550
Total current assets		2,287,537		2,543,290		(317,297	)		4,513,530
Finance receivables, net		—		2,020,036		—			2,020,036
Restricted finance receivables held by variable interest entities, net		—		1,971,878		—			1,971,878
Property, plant and equipment, net		761,191		29,873		—			791,064
Goodwill		29,740		—		—			29,740
Other long-term assets		336,167		15,970		(73,038	)		279,099
	$	3,414,635	$	6,581,047	$	(390,335	)	$	9,605,347
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	280,738	$	392,461	$	(317,297	)	$	355,902
Accrued liabilities		478,227		102,722		(3,330	)		577,619
Short-term debt		—		629,143		—			629,143
Current portion of long-term debt		—		399,939					399,939
Current portion of long-term debt held by variable interest entities		—		620,624		—			620,624
Total current liabilities		758,965		2,144,889		(320,627	)		2,583,227
Long-term debt		303,000		2,481,688		—			2,784,688
Long-term debt held by variable interest entities		—		1,133,696		—			1,133,696
Pension liability		118,212		—		—			118,212
Postretirement healthcare benefits		265,871		—		—			265,871
Other long-term liabilities		130,278		14,716		—			144,994
Commitments and contingencies (Note 16)
Total shareholders' equity		1,838,309		806,058		(69,708	)		2,574,659
	$	3,414,635	$	6,581,047	$	(390,335	)	$	9,605,347

	December 31, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	943,330	$	583,620	$	—		$	1,526,950
Marketable securities		153,380		—		—			153,380
Accounts receivable, net		393,615		—		(174,576	)		219,039
Finance receivables, net		—		1,168,603		—			1,168,603
Restricted finance receivables held by variable interest entities, net		—		591,864		—			591,864
Inventories		418,006		—		—			418,006
Restricted cash held by variable interest entities		—		229,655		—			229,655
Other current assets		167,423		67,286		—			234,709
Total current assets		2,075,754		2,641,028		(174,576	)		4,542,206
Finance receivables, net		—		1,754,441		—			1,754,441
Restricted finance receivables held by variable interest entities, net		—		2,271,773		—			2,271,773
Property, plant and equipment, net		779,330		30,129		—			809,459
Goodwill		29,081		—		—			29,081
Other long-term assets		322,379		17,460		(72,635	)		267,204
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	220,957	$	209,332	$	(174,576	)	$	255,713
Accrued liabilities		482,838		85,038		(3,704	)		564,172
Short-term debt		—		838,486		—			838,486
Current portion of long-term debt		—		399,916					399,916
Current portion of long-term debt held by variable interest entities		—		640,331		—			640,331
Total current liabilities		703,795		2,173,103		(178,280	)		2,698,618
Long-term debt		303,000		2,093,871		—			2,396,871
Long-term debt held by variable interest entities		—		1,447,015		—			1,447,015
Pension liability		302,483		—		—			302,483
Postretirement healthcare benefits		268,582		—		—			268,582
Other long-term liabilities		126,036		14,303		—			140,339
Commitments and contingencies (Note 16)
Total shareholders' equity		1,502,648		986,539		(68,931	)		2,420,256
	$	3,206,544	$	6,714,831	$	(247,211	)	$	9,674,164

	March 27, 2011
	Motorcycles & Related Products Operations		Financial Services Operations		Eliminations			Consolidated
ASSETS
Current assets:
Cash and cash equivalents	$	663,026	$	269,489	$	—		$	932,515
Marketable securities		115,209		—		—			115,209
Accounts receivable, net		630,437		—		(332,766	)		297,671
Finance receivables, net		—		1,276,780		—			1,276,780
Restricted finance receivables held by variable interest entities, net		—		637,760		—			637,760
Inventories		372,323		—		—			372,323
Restricted cash held by variable interest entities		—		294,903		—			294,903
Other current assets		172,062		71,365		—			243,427
Total current assets		1,953,057		2,550,297		(332,766	)		4,170,588
Finance receivables, net		—		1,806,563		—			1,806,563
Restricted finance receivables held by variable interest entities, net		—		2,304,320		—			2,304,320
Property, plant and equipment, net		769,480		29,611		—			799,091
Goodwill		30,988		—		—			30,988
Other long-term assets		336,759		26,701		(69,868	)		293,592
	$	3,090,284	$	6,717,492	$	(402,634	)	$	9,405,142
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	246,746	$	378,696	$	(332,766	)	$	292,676
Accrued liabilities		493,896		89,253		(3,066	)		580,083
Short-term debt		—		393,393		—			393,393
Current portion of long-term debt held by variable interest entities		—		721,179		—			721,179
Total current liabilities		740,642		1,582,521		(335,832	)		1,987,331
Long-term debt		303,000		2,660,375		—			2,963,375
Long-term debt held by variable interest entities		—		1,603,584		—			1,603,584
Pension liability		99,627		—		—			99,627
Postretirement healthcare liability		254,505		—		—			254,505
Other long-term liabilities		145,739		10,733		—			156,472
Commitments and contingencies (Note 16)
Total shareholders' equity		1,546,771		860,279		(66,802	)		2,340,248
	$	3,090,284	$	6,717,492	$	(402,634	)	$	9,405,142

	Three months ended April 1, 2012
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Income from continuing operations	$	355,714		$	41,321		$	(225,000	)	$	172,035
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation		41,708			1,495			—			43,203
Amortization of deferred loan origination costs		—			18,547			—			18,547
Amortization of financing origination fees		118			2,625			—			2,743
Provision for employee long-term benefits		16,780			513			—			17,293
Contributions to pension and postretirement plans		(206,832	)		—			—			(206,832	)
Stock compensation expense		10,967			777			—			11,744
Net change in wholesale finance receivables		—			—			(151,046	)		(151,046	)
Provision for credit losses		—			9,014			—			9,014
Pension and postretirement healthcare plan curtailment and settlement expense		—			—			—			—
Foreign currency adjustments		(2,911	)		—			—			(2,911	)
Other, net		(1,954	)		3,459			—			1,505
Change in current assets and current liabilities:
Accounts receivable		(186,466	)		—			142,721			(43,745	)
Finance receivables - accrued interest and other		—			3,299			—			3,299
Inventories		(47,168	)		—			—			(47,168	)
Accounts payable and accrued liabilities		57,993			202,188			(142,721	)		117,460
Restructuring reserves		1,296			—			—			1,296
Derivative instruments		(390	)		(96	)		—			(486	)
Other		(18,058	)		(1,509	)		—			(19,567	)
Total adjustments		(334,917	)		240,312			(151,046	)		(245,651	)
Net cash provided by operating activities of continuing operations		20,797			281,633			(376,046	)		(73,616	)
Cash flows from investing activities of continuing operations:
Capital expenditures		(23,441	)		(1,239	)		—			(24,680	)
Origination of finance receivables		—			(1,617,867	)		972,620			(645,247	)
Collections of finance receivables		—			1,503,478			(821,574	)		681,904
Sales and redemptions of marketable securities		20,042			—			—			20,042
Net cash (used by) provided by investing activities of continuing operations		(3,399	)		(115,628	)		151,046			32,019
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		—			397,377			—			397,377
Repayments of securitization debt		—			(333,026	)		—			(333,026	)
Net borrowings of unsecured commercial paper		—			(211,669	)		—			(211,669	)
Net decrease in credit facilities		—			(12,839	)		—			(12,839	)
Net change in restricted cash		—			(17,340	)		—			(17,340	)
Dividends paid		(35,943	)		(225,000	)		225,000			(35,943	)
Purchase of common stock for treasury		(20,745	)		—			—			(20,745	)
Excess tax benefits from share based payments		7,962			—			—			7,962
Issuance of common stock under employee stock option plans		16,281			—			—			16,281
Net cash used by financing activities of continuing operations		(32,445	)		(402,497	)		225,000			(209,942	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		745			181			—			926
Net (decrease) increase in cash and cash equivalents of continuing operations		(14,302	)		(236,311	)		—			(250,613	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		—			—			—			—
Cash flows from investing activities of discontinued operations		—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—			—			—
		—			—			—			—
Net (decrease) increase in cash and cash equivalents	$	(14,302	)	$	(236,311	)	$	—		$	(250,613	)
Cash and cash equivalents:
Cash and cash equivalents - beginning of period	$	943,330		$	583,620		$	—		$	1,526,950
Cash and cash equivalents of discontinued operations - beginning of period		—			—			—			—
Net (decrease) increase in cash and cash equivalents		(14,302	)		(236,311	)		—			(250,613	)
Less: Cash and cash equivalents of discontinued operations - end of period		—			—			—			—
Cash and cash equivalents - end of period	$	929,028		$	347,309		$	—		$	1,276,337

	Three months ended March 27, 2011
	Motorcycles & Related Products Operations			Financial Services Operations			Eliminations & Adjustments			Consolidated
Cash flows from operating activities:
Income from continuing operations	$	202,433		$	41,827		$	(125,000	)	$	119,260
Adjustments to reconcile income from continuing operations to cash provided by operating activities:
Depreciation		41,340			1,607			—			42,947
Amortization of deferred loan origination costs		—			19,329			—			19,329
Amortization of financing origination fees		118			2,989			—			3,107
Provision for employee long-term benefits		16,445			(882	)		—			15,563
Contributions to pension and postretirement plans		(204,816	)		—			—			(204,816	)
Stock compensation expense		8,481			672			—			9,153
Net change in wholesale finance receivables		—			—			(163,967	)		(163,967	)
Provision for credit losses		—			5,606			—			5,606
Pension and postretirement healthcare plan curtailment and settlement expense		236			—			—			236
Foreign currency adjustments		29			—			—			29
Other, net		1,884			12,228			—			14,112
Change in current assets and current liabilities:
Accounts receivable		(167,885	)		—			140,837			(27,048	)
Finance receivables - accrued interest and other		—			3,542			—			3,542
Inventories		(38,200	)		—			—			(38,200	)
Accounts payable and accrued liabilities		39,517			152,692			(93,249	)		98,960
Restructuring reserves		7,757			—			—			7,757
Derivative instruments		2,178			(21	)		—			2,157
Other		(12,706	)		47,636			(47,575	)		(12,645	)
Total adjustments		(305,622	)		245,398			(163,954	)		(224,178	)
Net cash (used by) provided by operating activities of continuing operations		(103,189	)		287,225			(288,954	)		(104,918	)
Cash flows from investing activities of continuing operations:
Capital expenditures		(26,460	)		(1,244	)		—			(27,704	)
Origination of finance receivables		—			(1,406,139	)		856,939			(549,200	)
Collections of finance receivables		—			1,369,924			(692,972	)		676,952
Purchases of marketable securities		(5,000	)		—			—			(5,000	)
Sales and redemptions of marketable securities		29,974			—			—			29,974
Net cash (used by) provided by investing activities of continuing operations		(1,486	)		(37,459	)		163,967			125,022
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes		—			447,076			—			447,076
Repayments of securitization debt		—			(430,471	)		—			(430,471	)
Net decrease in credit facilities and unsecured commercial paper		—			(96,174	)		—			(96,174	)
Net change in restricted cash		—			(6,016	)		—			(6,016	)
Dividends paid		(23,643	)		(125,000	)		125,000			(23,643	)
Purchase of common stock for treasury		(4,699	)		—			—			(4,699	)
Excess tax benefits from share based payments		3,262			—			—			3,262
Issuance of common stock under employee stock option plans		3,861			—			—			3,861
Net cash used by financing activities of continuing operations		(21,219	)		(210,585	)		125,000			(106,804	)
Effect of exchange rate changes on cash and cash equivalents of continuing operations		(2,846	)		166			(13	)		(2,693	)
Net (decrease) increase in cash and cash equivalents of continuing operations		(128,740	)		39,347			—			(89,393	)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		(25	)		—			—			(25	)
Cash flows from investing activities of discontinued operations		—			—			—			—
Effect of exchange rate changes on cash and cash equivalents of discontinued operations		—			—			—			—
		(25	)		—			—			(25	)
Net (decrease) increase in cash and cash equivalents	$	(128,765	)	$	39,347		$	—		$	(89,418	)
Cash and cash equivalents:
Cash and cash equivalents - beginning of period	$	791,791		$	230,142		$	—		$	1,021,933
Cash and cash equivalents of discontinued operations - beginning of period		—			—			—			—
Net (decrease) increase in cash and cash equivalents		(128,765	)		39,347			—			(89,418	)
Less: Cash and cash equivalents of discontinued operations - end of period		—			—			—			—
Cash and cash equivalents - end of period	$	663,026		$	269,489		$	—		$	932,515

XML

Additional Balance Sheet And Cash Flow Information (Marketable Securities) (Details) (USD $)	3 Months Ended
	Apr. 01, 2012 M	Mar. 27, 2011	Dec. 31, 2011
Additional Balance Sheet And Cash Flow Information [Line Items]
Available-for-sale securities	$ 134,946,000	$ 115,209,000	$ 153,380,000
Gross unrealized gains	1,600,000	100,000
Gross unrealized gains, net of taxes	1,000,000	40,000
Contractual maturities period of marketable securities, minimum (in months)	12
Contractual maturities period of marketable securities, maximum (in months)	48
Corporate Bonds [Member]
Additional Balance Sheet And Cash Flow Information [Line Items]
Available-for-sale securities	134,946,000	55,232,000	153,380,000
U.S. Treasuries [Member]
Additional Balance Sheet And Cash Flow Information [Line Items]
Available-for-sale securities		$ 59,977,000

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Additional Balance Sheet And Cash Flow Information (Tables)

3 Months Ended

Apr. 01, 2012

Additional Balance Sheet And Cash Flow Information [Abstract]

Marketable Securities

	April 1, 2012		December 31, 2011		March 27, 2011
Available-for-sale:
Corporate bonds	$	134,946	$	153,380	$	55,232
U.S. Treasuries		—		—		59,977
	$	134,946	$	153,380	$	115,209

Inventories, Net

	April 1, 2012			December 31, 2011			March 27, 2011
Components at the lower of FIFO cost or market
Raw materials and work in process	$	113,127		$	113,932		$	99,538
Motorcycle finished goods		252,979			226,261			187,687
Parts and accessories and general merchandise		145,362			121,340			119,134
Inventory at lower of FIFO cost or market		511,468			461,533			406,359
Excess of FIFO over LIFO cost		(43,527	)		(43,527	)		(34,036	)
	$	467,941		$	418,006		$	372,323

Reconciliation Of Net Income To Net Cash Used By Operating Activities

	Three months ended
	April 1, 2012			March 27, 2011
Cash flows from operating activities:
Net income	$	172,035		$	119,260
Loss from discontinued operations		—			—
Income from continuing operations		172,035			119,260
Adjustments to reconcile income from continuing operations to net cash used by operating activities:
Depreciation		43,203			42,947
Amortization of deferred loan origination costs		18,547			19,329
Amortization of financing origination fees		2,743			3,107
Provision for employee long-term benefits		17,293			15,563
Contributions to pension and postretirement plans		(206,832	)		(204,816	)
Stock compensation expense		11,744			9,153
Net change in wholesale finance receivables related to sales		(151,046	)		(163,967	)
Provision for credit losses		9,014			5,606
Pension and postretirement healthcare plan curtailment and settlement expense		—			236
Foreign currency adjustments		(2,911	)		29
Other, net		1,505			14,112
Changes in current assets and liabilities:
Accounts receivable, net		(43,745	)		(27,048	)
Finance receivables - accrued interest and other		3,299			3,542
Inventories		(47,168	)		(38,200	)
Accounts payable and accrued liabilities		117,460			98,960
Restructuring reserves		1,296			7,757
Derivative instruments		(486	)		2,157
Other		(19,567	)		(12,645	)
Total adjustments		(245,651	)		(224,178	)
Net cash used by operating activities of continuing operations	$	(73,616	)	$	(104,918	)

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Supplemental Consolidating Data (Balance Sheet) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011	Dec. 31, 2010
Segment Reporting Information [Line Items]
Cash and cash equivalents	$ 1,276,337	$ 1,526,950	$ 932,515	$ 1,021,933
Marketable securities	134,946	153,380	115,209
Accounts receivable, net	264,272	219,039	297,671
Finance receivables, net	1,339,139	1,168,603	1,276,780
Restricted finance receivables held by variable interest entities, net	546,350	591,864	637,760
Inventories	467,941	418,006	372,323
Restricted cash held by variable interest entities	246,995	229,655	294,903
Other current assets	237,550	234,709	243,427
Total current assets	4,513,530	4,542,206	4,170,588
Finance receivables, net	2,020,036	1,754,441	1,806,563
Restricted finance receivables held by variable interest entities, net	1,971,878	2,271,773	2,304,320
Property, plant and equipment, net	791,064	809,459	799,091
Goodwill	29,740	29,081	30,988
Other long-term assets	279,099	267,204	293,592
Total Assets	9,605,347	9,674,164	9,405,142
Accounts payable	355,902	255,713	292,676
Accrued liabilities	577,619	564,172	580,083
Short-term debt	629,143	838,486	393,393
Current portion of long-term debt	399,939	399,916
Current portion of long-term debt held by variable interest entities	620,624	640,331	721,179
Total current liabilities	2,583,227	2,698,618	1,987,331
Long-term debt	2,784,688	2,396,871	2,963,375
Long-term debt held by variable interest entities	1,133,696	1,447,015	1,603,584
Pension liability	118,212	302,483	99,627
Postretirement healthcare benefits	265,871	268,582	254,505
Other long-term liabilities	144,994	140,339	156,472
Commitments and contingencies (Note 16)
Total shareholders' equity	2,574,659	2,420,256	2,340,248
Total liabilities and shareholders' equity	9,605,347	9,674,164	9,405,142
Motorcycles & Related Products Operations [Member]
Segment Reporting Information [Line Items]
Cash and cash equivalents	929,028	943,330	663,026	791,791
Marketable securities	134,946	153,380	115,209
Accounts receivable, net	581,569	393,615	630,437
Inventories	467,941	418,006	372,323
Other current assets	174,053	167,423	172,062
Total current assets	2,287,537	2,075,754	1,953,057
Property, plant and equipment, net	761,191	779,330	769,480
Goodwill	29,740	29,081	30,988
Other long-term assets	336,167	322,379	336,759
Total Assets	3,414,635	3,206,544	3,090,284
Accounts payable	280,738	220,957	246,746
Accrued liabilities	478,227	482,838	493,896
Total current liabilities	758,965	703,795	740,642
Long-term debt	303,000	303,000	303,000
Pension liability	118,212	302,483	99,627
Postretirement healthcare benefits	265,871	268,582	254,505
Other long-term liabilities	130,278	126,036	145,739
Commitments and contingencies (Note 16)
Total shareholders' equity	1,838,309	1,502,648	1,546,771
Total liabilities and shareholders' equity	3,414,635	3,206,544	3,090,284
Financial Services Operations [Member]
Segment Reporting Information [Line Items]
Cash and cash equivalents	347,309	583,620	269,489	230,142
Finance receivables, net	1,339,139	1,168,603	1,276,780
Restricted finance receivables held by variable interest entities, net	546,350	591,864	637,760
Restricted cash held by variable interest entities	246,995	229,655	294,903
Other current assets	63,497	67,286	71,365
Total current assets	2,543,290	2,641,028	2,550,297
Finance receivables, net	2,020,036	1,754,441	1,806,563
Restricted finance receivables held by variable interest entities, net	1,971,878	2,271,773	2,304,320
Property, plant and equipment, net	29,873	30,129	29,611
Other long-term assets	15,970	17,460	26,701
Total Assets	6,581,047	6,714,831	6,717,492
Accounts payable	392,461	209,332	378,696
Accrued liabilities	102,722	85,038	89,253
Short-term debt	629,143	838,486	393,393
Current portion of long-term debt	399,939	399,916
Current portion of long-term debt held by variable interest entities	620,624	640,331	721,179
Total current liabilities	2,144,889	2,173,103	1,582,521
Long-term debt	2,481,688	2,093,871	2,660,375
Long-term debt held by variable interest entities	1,133,696	1,447,015	1,603,584
Other long-term liabilities	14,716	14,303	10,733
Commitments and contingencies (Note 16)
Total shareholders' equity	806,058	986,539	860,279
Total liabilities and shareholders' equity	6,581,047	6,714,831	6,717,492
Eliminations & Adjustments [Member]
Segment Reporting Information [Line Items]
Accounts receivable, net	(317,297)	(174,576)	(332,766)
Total current assets	(317,297)	(174,576)	(332,766)
Other long-term assets	(73,038)	(72,635)	(69,868)
Total Assets	(390,335)	(247,211)	(402,634)
Accounts payable	(317,297)	(174,576)	(332,766)
Accrued liabilities	(3,330)	(3,704)	(3,066)
Total current liabilities	(320,627)	(178,280)	(335,832)
Commitments and contingencies (Note 16)
Total shareholders' equity	(69,708)	(68,931)	(66,802)
Total liabilities and shareholders' equity	$ (390,335)	$ (247,211)	$ (402,634)

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New Accounting Standards

3 Months Ended

Apr. 01, 2012

New Accounting Standards [Abstract]

New Accounting Standards

2. New Accounting Standards

Accounting Standards Recently Adopted

In May 2011, the FASB issued Accounting Standards Update (ASU) No. 2011-04, "Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs." ASU No. 2011-04 clarifies the application of existing guidance within ASC Topic 820, "Fair Value Measurement" to ensure consistency between U.S. GAAP and International Financial Reporting Standards (IFRS). ASU No. 2011-04 also requires new disclosures about purchases, sales, issuances, and settlements related to Level 3 measurements and also requires new disclosures around transfers into and out of Levels 1 and 2 in the fair value hierarchy. The Company adopted ASU No. 2011-04 on January 1, 2012. The adoption of ASU No. 2011-04 required additional disclosures of the hierarchy classification for items whose fair value is not recorded on the balance sheet but is disclosed in the notes, refer to Note 9 for additional information. There was no financial impact resulting from the adoption of ASU No. 2011-04.

In June 2011, the FASB issued ASU No. 2011-05, "Presentation of Comprehensive Income." ASU No. 2011-05 amends the guidance within ASC Topic 220, "Comprehensive Income," to eliminate the option to present the components of other comprehensive income as part of the statement of shareholders' equity. ASU No. 2011-05 requires that all nonowner changes in shareholders' equity be presented in either a single continuous statement of comprehensive income or in two separate but consecutive statements. The Company decided to present comprehensive income in two separate but consecutive statements. The Company adopted ASU No. 2011-05 on January 1, 2012. The adoption of ASU No. 2011-05 and the Company's decision to present comprehensive income in two separate but consecutive statements required the presentation of an additional financial statement, condensed consolidated statements of comprehensive income, for all periods presented.

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Condensed Consolidated Statements Of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Condensed Consolidated Statements Of Comprehensive Income [Abstract]
Comprehensive income	$ 180,816	$ 138,431

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Product Warranty And Safety Recall Campaigns

3 Months Ended

Apr. 01, 2012

Product Warranty And Safety Recall Campaigns [Abstract]

Product Warranty And Safety Recall Campaigns

12. Product Warranty and Safety Recall Campaigns

The Company currently provides a standard two-year limited warranty on all new motorcycles sold worldwide, except for Japan, where the Company currently provides a standard three-year limited warranty on all new motorcycles sold. In addition, the Company started offering a one-year warranty for Parts & Accessories (P&A) in 2012. The warranty coverage for the retail customer generally begins when the product is sold to a retail customer. The Company maintains reserves for future warranty claims using an estimated cost, which is based primarily on historical Company claim information. Additionally, the Company has from time to time initiated certain voluntary safety recall campaigns. The Company reserves for all estimated costs associated with safety recalls in the period that the safety recalls are announced.

Changes in the Company's warranty and safety recall liability were as follows (in thousands):

	Three months ended
	April 1, 2012			March 27, 2011
Balance, beginning of period	$	54,994		$	54,134
Warranties issued during the period		14,912			11,225
Settlements made during the period		(13,958	)		(10,296	)
Recalls and changes to pre-existing warranty liabilities		1,154			2,048
Balance, end of period	$	57,102		$	57,111

The liability for safety recall campaigns was $8.0 million and $3.4 million as of April 1, 2012 and March 27, 2011, respectively.

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Document And Entity Information	3 Months Ended
	Apr. 01, 2012	May 03, 2012
Document And Entity Information [Abstract]
Document Type	10-Q
Document Period End Date	Apr. 01, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Registrant Name	HARLEY DAVIDSON INC
Entity Central Index Key	0000793952
Entity Current Reporting Status	Yes
Entity Voluntary Filers	Yes
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Well-known Seasoned Issuer	Yes
Entity Common Stock, Shares Outstanding		231,519,008

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Earnings Per Share

3 Months Ended

Apr. 01, 2012

Earnings Per Share [Abstract]

Earnings Per Share

13. Earnings Per Share

The following table sets forth the computation for basic and diluted earnings per share from continuing operations (in thousands, except per share amounts):

	Three months ended
	April 1, 2012		March 27, 2011
Numerator:
Income from continuing operations used in computing basic and diluted earnings per share	$	172,035	$	119,260
Denominator:
Denominator for basic earnings per share- weighted-average common shares		228,988		233,820
Effect of dilutive securities—employee stock compensation plan		2,296		2,083
Denominator for diluted earnings per share- adjusted weighted-average shares outstanding		231,284		235,903
Earnings per common share from continuing operations:
Basic	$	0.75	$	0.51
Diluted	$	0.74	$	0.51

Outstanding options to purchase 2.4 million and 3.3 million shares of common stock for the three months ended April 1, 2012 and March 27, 2011, respectively, were not included in the Company's computation of dilutive securities because the exercise price was greater than the market price and therefore the effect would have been anti-dilutive.

The Company has a share-based compensation plan under which employees may be granted share-based awards including shares of restricted stock and restricted stock units (RSUs). Non-forfeitable dividends are paid on unvested shares of restricted stock and non-forfeitable dividend equivalents are paid on unvested RSUs. As such, shares of restricted stock and RSUs are considered participating securities under the two-class method of calculating earnings per share as described in ASC Topic 260, "Earnings per Share." The two-class method of calculating earnings per share did not have a material impact on the Company's earnings per share calculation as of April 1, 2012 and March 27, 2011.

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Condensed Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011	Dec. 31, 2010
Current assets:
Cash and cash equivalents	$ 1,276,337	$ 1,526,950	$ 932,515	$ 1,021,933
Marketable securities	134,946	153,380	115,209
Accounts receivable, net	264,272	219,039	297,671
Finance receivables, net	1,339,139	1,168,603	1,276,780
Restricted finance receivables held by variable interest entities, net	546,350	591,864	637,760
Inventories	467,941	418,006	372,323
Restricted cash held by variable interest entities	246,995	229,655	294,903
Other current assets	237,550	234,709	243,427
Total current assets	4,513,530	4,542,206	4,170,588
Finance receivables, net	2,020,036	1,754,441	1,806,563
Restricted finance receivables held by variable interest entities, net	1,971,878	2,271,773	2,304,320
Property, plant and equipment, net	791,064	809,459	799,091
Goodwill	29,740	29,081	30,988
Other long-term assets	279,099	267,204	293,592
Total assets	9,605,347	9,674,164	9,405,142
Current liabilities:
Accounts payable	355,902	255,713	292,676
Accrued liabilities	577,619	564,172	580,083
Short-term debt	629,143	838,486	393,393
Current portion of long-term debt	399,939	399,916
Current portion of long-term debt held by variable interest entities	620,624	640,331	721,179
Total current liabilities	2,583,227	2,698,618	1,987,331
Long-term debt	2,784,688	2,396,871	2,963,375
Long-term debt held by variable interest entities	1,133,696	1,447,015	1,603,584
Pension liability	118,212	302,483	99,627
Postretirement healthcare liability	265,871	268,582	254,505
Other long-term liabilities	144,994	140,339	156,472
Commitments and contingencies (Note 16)
Total shareholders' equity	2,574,659	2,420,256	2,340,248
Total liabilities and shareholders' equity	$ 9,605,347	$ 9,674,164	$ 9,405,142

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Asset-Backed Financing

3 Months Ended

Apr. 01, 2012

Asset-Backed Financing [Abstract]

Asset-Backed Financing

7. Asset-Backed Financing

HDFS participates in asset-backed financing through both term asset-backed securitization transactions and its asset-backed commercial paper conduit facility. In both types of asset-backed financing programs, HDFS transfers U.S. retail motorcycle finance receivables to a consolidated special purpose entity (SPE) while retaining the servicing rights. Each SPE then converts those assets into cash, through the issuance of debt. These SPEs are considered VIEs under U.S. GAAP. HDFS is required to consolidate any VIEs in which it is deemed to be the primary beneficiary through having power over the significant activities of the entity and having an obligation to absorb losses or the right to receive benefits from the VIE which are potentially significant to the VIE.

HDFS is considered to have power over the significant activities of its term asset-backed securitization and asset-backed commercial paper conduit facility VIEs due to its role as servicer. Servicing fees are typically not considered potentially significant variable interests in a VIE. However, HDFS retains a residual interest in the VIEs in the form of a debt security, which gives HDFS the right to receive benefits that could be potentially significant to the VIE. Therefore, the Company is the primary beneficiary and consolidates all of its VIEs within its consolidated financial statements. Servicing fees paid by VIEs to HDFS are eliminated in consolidation and therefore are not recorded on a consolidated basis.

HDFS is not required, and does not currently intend, to provide any additional financial support to its VIEs. Investors and creditors only have recourse to the assets held by the VIEs.

The Company's VIEs have been aggregated on the balance sheet due to the similarity of the nature of the assets involved as well as the purpose and design of the VIEs.

Term Asset-Backed Securitization VIEs

The Company transfers U.S. retail motorcycle finance receivables to SPEs which in turn issue secured notes to investors, with various maturities and interest rates, secured by future collections of the purchased U.S. retail motorcycle finance receivables. Each term asset-backed securitization SPE is a separate legal entity and the U.S. retail motorcycle finance receivables included in each term asset-backed securitizations are only available for payment of that secured debt and other obligations arising from the term asset-backed securitization transaction and are not available to pay other obligations or claims of the Company's creditors until the associated secured debt and other obligations are satisfied. Cash and cash equivalent balances held by the SPEs are used only to support the securitizations. There are no amortization schedules for the secured notes; however, the debt is reduced monthly as available collections on the related U.S. retail motorcycle finance receivables are applied to outstanding principal. The secured notes' contractual lives have various maturities ranging from 2012 to 2018.

There were no term asset-backed securitization transactions completed during the three months ended April 1, 2012 or March 27, 2011.

The following table presents the assets and liabilities of the consolidated term asset-backed securitization SPEs that were included in the Company's financial statements (in thousands):

	April 1, 2012			December 31, 2011			March 27, 2011
Assets:
Finance receivables	$	2,564,585		$	2,916,219		$	3,000,580
Allowance for credit losses		(56,810	)		(65,735	)		(81,631	)
Restricted cash		245,912			228,776			293,090
Other assets		5,620			6,772			10,499
Total assets	$	2,759,307		$	3,086,032		$	3,222,538
Liabilities
Term asset-backed securitization debt	$	1,754,320		$	2,087,346		$	2,324,763

Asset-Backed Commercial Paper Conduit Facility VIE

On September 9, 2011, the Company amended and restated its third-party bank sponsored asset-backed commercial paper conduit facility which provides for a total aggregate commitment of $600.0 million based on, among other things, the amount of eligible U.S. retail motorcycle loans held by the SPE as collateral. The amended agreement has terms similar to the prior agreement and is for the same amount. Under the facility, HDFS may transfer U.S. retail motorcycle finance receivables to a SPE, which in turn may issue debt to third-party bank-sponsored asset-backed commercial paper conduits. The assets of the SPE are restricted as collateral for the payment of the debt or other obligations arising in the transaction and are not available to pay other obligations or claims of the Company's creditors. The terms for this debt provide for interest on the outstanding principal based on prevailing commercial paper rates, or LIBOR plus a specified margin to the extent the advance is not funded by a conduit lender through the issuance of commercial paper. The conduit facility also provides for an unused commitment fee based on the unused portion of the total aggregate commitment of $600.0 million. There is no amortization schedule; however, the debt is reduced monthly as available collections on the related finance receivables are applied to outstanding principal. Upon expiration of the conduit facility, any outstanding principal will continue to be reduced monthly through available collections. Unless earlier terminated or extended by mutual agreement of HDFS and the lenders, the conduit facility has an expiration date of September 7, 2012.

The following table presents the assets of the asset-backed commercial paper conduit facility SPEs that were included in our financial statements (in thousands);

	April 1, 2012			December 31, 2011			March 27, 2011
Finance receivables	$	10,689		$	13,455		$	23,776
Allowance for credit losses		(236	)		(302	)		(645	)
Restricted cash		1,083			879			1,813
Other assets		312			449			598
Total assets	$	11,848		$	14,481		$	25,542

The SPEs had no borrowings outstanding under the conduit facility at April 1, 2012, December 31, 2011 or March 27, 2011, therefore, these assets are restricted as collateral for the payment of fees associated with the unused portion of the total aggregate commitment of $600.0 million.

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Finance Receivables

3 Months Ended

Apr. 01, 2012

Finance Receivables [Abstract]

Finance Receivables

6. Finance Receivables

HDFS provides retail financial services to customers of the Company's independent dealers in the United States and Canada. The origination of retail loans is a separate and distinct transaction between HDFS and the retail customer, unrelated to the Company's sale of product to its dealers. Retail finance receivables consist of secured promissory notes and installment loans. HDFS holds either titles or liens on titles to vehicles financed by promissory notes and installment loans.

HDFS offers wholesale financing to the Company's independent dealers. Wholesale loans to dealers are generally secured by financed inventory or property and are originated in the U.S. and Canada.

Finance receivables, net, including finance receivables held by VIEs, consisted of the following (in thousands):

	April 1,			December 31,			March 27,
	2012			2011			2011
Retail	$	5,043,584		$	5,087,490		$	5,225,155
Wholesale		956,322			824,640			959,952
		5,999,906			5,912,130			6,185,107
Allowance for credit losses		(122,503	)		(125,449	)		(159,684	)
	$	5,877,403		$	5,786,681		$	6,025,423

At April 1, 2012, December 31, 2011 and March 27, 2011, the Company's Condensed Consolidated Balance Sheet included finance receivables, net of $2.52 billion, $2.86 billion and $2.94 billion, respectively, which were restricted as collateral for the payment of debt held by VIEs and other related obligations as discussed in Note 7. These receivables are included in retail finance receivables in the table above.

A provision for credit losses on finance receivables is charged to earnings in amounts sufficient to maintain the allowance for credit losses on finance receivables at a level that is adequate to cover losses of principal inherent in the existing portfolio. The allowance for credit losses on finance receivables represents management's estimate of probable losses inherent in the finance receivable portfolio as of the balance sheet date. However, due to the use of projections and assumptions in estimating the losses, the amount of losses actually incurred by the Company could differ from the amounts estimated.

Changes in the allowance for credit losses on finance receivables by portfolio were as follows (in thousands):

	Three months ended April 1, 2012
	Retail			Wholesale		Total
Balance, beginning of period	$	116,112		$	9,337	$	125,449
Provision for credit losses		8,705			309		9,014
Charge-offs		(25,852	)		—		(25,852	)
Recoveries		13,892			—		13,892
Balance, end of period	$	112,857		$	9,646	$	122,503
	Three months ended March 27, 2011
	Retail			Wholesale		Total
Balance, beginning of period	$	157,791		$	15,798	$	173,589
Provision for credit losses		3,439			2,167		5,606
Charge-offs		(35,191	)		—		(35,191	)
Recoveries		15,665			15		15,680
Balance, end of period	$	141,704		$	17,980	$	159,684

Included in the $112.9 and $141.7 million retail allowance for credit losses on finance receivables is $57.0 and $82.3 million, respectively, related to finance receivables held by VIEs.

Portions of the allowance for credit losses on finance receivables are specified to cover estimated losses on finance receivables specifically identified for impairment. The unspecified portion of the allowance for credit losses on finance receivables covers estimated losses on finance receivables which are collectively reviewed for impairment. Finance receivables are considered impaired when management determines it is probable that the Company will be unable to collect all amounts due according to the terms of the loan agreement.

The retail portfolio primarily consists of a large number of small balance, homogeneous finance receivables. HDFS performs a periodic and systematic collective evaluation of the adequacy of the retail allowance for credit losses. HDFS utilizes loss forecast models which consider a variety of factors including, but not limited to, historical loss trends, origination or vintage analysis, known and inherent risks in the portfolio, the value of the underlying collateral, recovery rates and current economic conditions including items such as unemployment rates. As retail finance receivables are collectively and not individually reviewed for impairment, this portfolio does not have finance receivables specifically impaired.

The wholesale portfolio is primarily composed of large balance, non-homogeneous loans. The Company's evaluation for the wholesale allowance for credit losses is first based on a loan-by-loan review. A specific allowance for credit losses is established for wholesale finance receivables determined to be individually impaired when management concludes that the borrower will not be able to make full payment of the contractual amounts due based on the original terms of the loan agreement. The impairment is determined based on the cash that the Company expects to receive discounted at the loan's original interest rate or the fair value of the collateral, if the loan is collateral-dependent. In establishing the allowance for credit losses, management considers a number of factors including the specific borrower's financial performance as well as ability to repay. Finance receivables in the wholesale portfolio that are not considered impaired on an individual basis are segregated, based on similar risk characteristics, according to the Company's internal risk rating system and collectively evaluated for impairment. The related allowance for credit losses is based on factors such as the Company's past loan loss experience, current economic conditions as well as the value of the underlying collateral.

Impaired wholesale finance receivables also include loans that have been modified in troubled debt restructurings as a concession to borrowers experiencing financial difficulty. Generally, it is the Company's policy not to change the terms and conditions of finance receivables. However, to minimize the economic loss, the Company may modify certain impaired finance receivables in troubled debt restructurings. Total restructured finance receivables are not significant.

The allowance for credit losses and finance receivables by portfolio, segregated by those amounts that are individually evaluated for impairment and those that are collectively evaluated for impairment was, as follows (in thousands):

	April 1, 2012
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		112,857		9,646		122,503
Total allowance for credit losses	$	112,857	$	9,646	$	122,503
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		5,043,584		956,322		5,999,906
Total finance receivables	$	5,043,584	$	956,322	$	5,999,906
	December 31, 2011
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		116,112		9,337		125,449
Total allowance for credit losses	$	116,112	$	9,337	$	125,449
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		5,087,490		824,640		5,912,130
Total finance receivables	$	5,087,490	$	824,640	$	5,912,130
	March 27, 2011
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	3,451	$	3,451
Collectively evaluated for impairment		141,704		14,529		156,233
Total allowance for credit losses	$	141,704	$	17,980	$	159,684
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	5,187	$	5,187
Collectively evaluated for impairment		5,225,155		954,765		6,179,920
Total finance receivables	$	5,225,155	$	959,952	$	6,185,107

There were no wholesale finance receivables at April 1, 2012 or December 31, 2011 that were individually deemed to be impaired under ASC Topic 310, "Receivables". Additional information related to the wholesale finance receivables that were individually deemed to be impaired under ASC Topic 310, "Receivables," at March 27, 2011 includes (in thousands):

			Unpaid				Average		Interest
	Recorded		Principal		Related		Recorded		Income
	Investment		Balance		Allowance		Investment		Recognized
Wholesale:
No related allowance recorded	$	—	$	—	$	—	$	—	$	—
Related allowance recorded		5,187		5,037		3,451		5,527		—
Total impaired wholesale finance receivables	$	5,187	$	5,037	$	3,451	$	5,527	$	—

Retail finance receivables are contractually delinquent if the minimum payment is not received by the specified due date. Retail finance receivables are generally charged-off at 120 days contractually past due. Retail finance receivables accrue interest until either collected or charged-off. Accordingly, as of April 1, 2012, December 31, 2011 and March 27, 2011, all retail finance receivables were accounted for as interest-earning receivables, of which $16.3 million, $27.5 million and $25.1 million, respectively, were 90 days or more past due.

Wholesale finance receivables are delinquent if the minimum payment is not received by the contractual due date. Wholesale finance receivables are written down once management determines that the specific borrower does not have the ability to repay the loan in full. Interest continues to accrue on past due wholesale finance receivables until the date the collection of the finance receivables becomes doubtful, at which time the finance receivable is placed on non-accrual status. The Company will resume accruing interest on these wholesale finance receivables when payments are current according to the terms of the loan agreements and future payments are reasonably assured. While on non-accrual status, all cash received is applied to principal or interest as appropriate. There were no wholesale receivables on non-accrual status at April 1, 2012 or December 31, 2011. The recorded investment of non-accrual status wholesale finance receivables at March 27, 2011 was $5.2 million. At April 1, 2012, December 31, 2011 and March 27, 2011, $0.3 million, $0.9 million, and $2.0 million of wholesale finance receivables were 90 days or more past due and accruing interest, respectively.

An analysis of the aging of past due finance receivables, which includes non-accrual status finance receivables was as follows (in thousands):

	April 1, 2012
							Greater than				Total
			31-60 Days		61-90 Days		90 Days		Total		Finance
	Current		Past Due		Past Due		Past Due		Past Due		Receivables
Retail	$	4,930,739	$	75,560	$	21,023	$	16,262	$	112,845	$	5,043,584
Wholesale		955,493		354		149		326		829		956,322
Total	$	5,886,232	$	75,914	$	21,172	$	16,588	$	113,674	$	5,999,906
	December 31, 2011
							Greater than				Total
			31-60 Days		61-90 Days		90 Days		Total		Finance
	Current		Past Due		Past Due		Past Due		Past Due		Receivables
Retail	$	4,915,711	$	107,373	$	36,937	$	27,469	$	171,779	$	5,087,490
Wholesale		822,610		777		344		909		2,030		824,640
Total	$	5,738,321	$	108,150	$	37,281	$	28,378	$	173,809	$	5,912,130
	March 27, 2011
							Greater than				Total
			31-60 Days		61-90 Days		90 Days		Total		Finance
	Current		Past Due		Past Due		Past Due		Past Due		Receivables
Retail	$	5,059,870	$	107,471	$	32,691	$	25,123	$	165,285	$	5,225,155
Wholesale		955,478		881		895		2,698		4,474		959,952
Total	$	6,015,348	$	108,352	$	33,586	$	27,821	$	169,759	$	6,185,107

A significant part of managing HDFS' finance receivable portfolios includes the assessment of credit risk associated with each borrower. As the credit risk varies between the retail and wholesale portfolios, HDFS utilizes different credit risk indicators for each portfolio.

HDFS manages retail credit risk through its credit approval policy and ongoing collection efforts. HDFS uses FICO scores to differentiate the expected default rates of retail credit applicants enabling the Company to better evaluate credit applicants for approval and to tailor pricing according to this assessment. Retail loans with a FICO score of 640 or above at origination are considered prime, and loans with a FICO score below 640 are considered sub-prime. These credit quality indicators are determined at the time of loan origination and are not updated subsequent to the loan origination date.

The recorded investment of retail finance receivables, by credit quality indicator, was as follows (in thousands):

	April 1, 2012		December 31, 2011		March 27, 2011
Prime	$	4,056,602	$	4,097,048	$	4,185,825
Sub-prime		986,982		990,442		1,039,330
Total	$	5,043,584	$	5,087,490	$	5,225,155

HDFS' credit risk on the wholesale portfolio is different from that of the retail portfolio. Whereas the retail portfolio represents a relatively homogeneous pool of retail finance receivables that exhibit more consistent loss patterns, the wholesale portfolio exposures are less consistent. HDFS utilizes an internal credit risk rating system to manage credit risk exposure consistently across wholesale borrowers and capture credit risk factors for each borrower.

HDFS uses the following internal credit quality indicators, based on the Company's internal risk rating system, listed from highest level of risk to lowest level of risk for the wholesale portfolio: Doubtful, Substandard, Special Mention, Medium Risk and Low Risk. Based upon management's review, the dealers classified in the Doubtful category are the dealers with the greatest likelihood of being charged-off, while the dealers classified as Low Risk are least likely to be charged-off. The internal rating system considers factors such as the specific borrowers' ability to repay and the estimated value of any collateral. Dealer risk rating classifications are reviewed and updated on a quarterly basis.

The recorded investment of wholesale finance receivables, by internal credit quality indicator, was as follows (in thousands):

	April 1, 2012		December 31, 2011		March 27, 2011
Doubtful	$	13,108	$	13,048	$	20,550
Substandard		5,599		5,052		19,510
Special Mention		8,618		14,361		21,069
Medium Risk		6,365		3,032		16,225
Low Risk		922,632		789,147		882,598
Total	$	956,322	$	824,640	$	959,952

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Subsequent Event

3 Months Ended

Apr. 01, 2012

Subsequent Event [Abstract]

Subsequent Event

18. Subsequent Event

On April 13, 2012, the Company and HDFS entered into a new five-year credit facility totaling $675.0 million. This facility replaces the existing $675.0 million three-year facility that was due to mature in April 2013.

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Employee Benefit Plans

3 Months Ended

Apr. 01, 2012

Employee Benefit Plans [Abstract]

Employee Benefit Plans

14. Employee Benefit Plans

The Company has defined benefit pension plans and postretirement healthcare benefit plans, which cover substantially all employees of the Motorcycles segment. The Company also has unfunded supplemental employee retirement plan agreements (SERPA) with certain employees which were instituted to replace benefits lost under the Tax Revenue Reconciliation Act of 1993. Components of net periodic benefit costs were as follows (in thousands):

	Three months ended
	April 1, 2012			March 27, 2011
Pension and SERPA Benefits
Service cost	$	8,420		$	9,273
Interest cost		20,816			20,147
Expected return on plan assets		(29,277	)		(26,653	)
Amortization of unrecognized:
Prior service cost		740			745
Net loss		10,969			7,554
Curtailment loss		—			236
Net periodic benefit cost	$	11,668		$	11,302
Postretirement Healthcare Benefits
Service cost	$	1,853		$	1,907
Interest cost		4,578			4,911
Expected return on plan assets		(2,356	)		(2,346	)
Amortization of unrecognized:
Prior service credit		(963	)		(969	)
Net loss		1,855			1,798
Net periodic benefit cost	$	4,967		$	5,301

The 2011 Restructuring Plan action resulted in a pension plan curtailment loss of $0.2 million, which is included in restructuring expense for the three months ended March 27, 2011. The curtailment loss also resulted in a pension plan remeasurement during the first quarter of 2011 using a discount rate of 5.76% and a postretirement healthcare plan remeasurement using a discount rate of 5.30%. At December 31, 2010, the discount rates used to measure the pension plans and the postretirement healthcare plans were 5.79% and 5.28%, respectively. As a result of the remeasurements, the Company recognized a funded status adjustment consisting of a $0.9 million decrease to its pension and postretirement healthcare liabilities and an increase to other comprehensive income of $0.9 million, or $0.5 million net of tax.

During the first quarter of 2012, the Company voluntarily contributed $200.0 million in cash to further fund its pension plans. No additional pension contributions are required in 2012. The Company also voluntarily contributed $200.0 million in cash to further fund its pension plans during the first quarter of 2011. The Company expects it will continue to make on-going contributions related to current benefit payments for SERPA and postretirement healthcare plans.

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Derivative Instruments And Hedging Activities

3 Months Ended

Apr. 01, 2012

Derivative Instruments And Hedging Activities [Abstract]

Derivative Instruments And Hedging Activities

10. Derivative Instruments and Hedging Activities

The Company is exposed to certain risks such as foreign currency exchange rate risk, interest rate risk and commodity price risk. To reduce its exposure to such risks, the Company selectively uses derivative financial instruments. All derivative transactions are authorized and executed pursuant to regularly reviewed policies and procedures, which prohibit the use of financial instruments for speculative trading purposes.

All derivative instruments are recognized on the balance sheet at fair value (see Note 9). In accordance with ASC Topic 815, "Derivatives and Hedging," the accounting for changes in the fair value of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, further, on the type of hedging relationship. Changes in the fair value of derivatives that are designated as fair value hedges, along with the gain or loss on the hedged item, are recorded in current period earnings. For derivative instruments that are designated as cash flow hedges, the effective portion of gains and losses that result from changes in the fair value of derivative instruments is initially recorded in other comprehensive income (OCI) and subsequently reclassified into earnings when the hedged item affects income. The Company assesses, both at the inception of each hedge and on an on-going basis, whether the derivatives that are used in its hedging transactions are highly effective in offsetting changes in cash flows of the hedged items. Any ineffective portion is immediately recognized in earnings. No component of a hedging derivative instrument's gain or loss is excluded from the assessment of hedge effectiveness. Derivative instruments that do not qualify for hedge accounting are recorded at fair value and any changes in fair value are recorded in current period earnings.

The Company sells its products internationally and in most markets those sales are made in the foreign country's local currency. As a result, the Company's earnings can be affected by fluctuations in the value of the U.S. dollar relative to foreign currency. The Company's most significant foreign currency risk relates to the Euro, the Australian dollar and the Japanese yen. The Company utilizes foreign currency contracts to mitigate the effects of these currencies' fluctuations on earnings. The foreign currency contracts are entered into with banks and allow the Company to exchange a specified amount of foreign currency for U.S. dollars at a future date, based on a fixed exchange rate.

The Company utilizes natural gas contracts to hedge portions of the cost of natural gas consumed in the Company's motorcycle production operations.

The Company's foreign currency contracts and natural gas contracts generally have maturities of less than one year.

The Company's earnings are affected by changes in interest rates. HDFS utilizes interest rate swaps to reduce the impact of fluctuations in interest rates on its unsecured commercial paper by converting a portion from a floating rate basis to a fixed rate basis. HDFS also entered into derivative contracts to facilitate its first quarter 2008 term asset-backed securitization transaction. These derivatives, which hedge assets held by a VIE, did not qualify for hedge accounting treatment and expired during 2011. The fair value of HDFS's interest rate swaps is determined using pricing models that incorporate quoted prices for similar assets and observable inputs such as interest rates and yield curves. Fair value is determined using Level 2 inputs.

The following table summarizes the fair value of the Company's derivative financial instruments (in thousands):

	April 1, 2012						December 31, 2011						March 27, 2011
Derivatives Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Foreign currency contracts(c)	$	219,484	$	6,345	$	—	$	306,450	$	16,443	$	1,852	$	300,455	$	—	$	18,675
Natural gas contracts(c)		918		—		262		3,915		—		265		3,165		—		26
Interest rate swaps—unsecured commercial paper(c)		95,100		—		1,972		102,100		—		3,020		126,000		—		6,068
Total	$	315,502	$	6,345	$	2,234	$	412,465	$	16,443	$	5,137	$	429,620	$	—	$	24,769

	April 1, 2012						December 31, 2011						March 27, 2011
Derivatives Not Designated As Hedging Instruments Under ASC Topic 815	Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)		Notional Value		Asset Fair  Value(a)		Liability Fair  Value(b)
Derivatives - securitization transactions	$	—	$	—	$	—	$	—	$	—	$	—	$	17,723	$	18	$	18
	$	—	$	—	$	—	$	—	$	—	$	—	$	17,723	$	18	$	18

(a) Included in other current assets

(b) Included in accrued liabilities

(c) Derivative designated as a cash flow hedge

The following tables summarize the amount of gains and losses related to derivative financial instruments designated as cash flow hedges (in thousands):

	Amount of Gain/(Loss) Recognized in OCI
	Three months ended
Cash Flow Hedges	April 1, 2012			March 27, 2011
Foreign currency contracts	$	(6,215	)	$	(10,161	)
Natural gas contracts		(315	)		(37	)
Interest rate swaps—unsecured commercial paper		(15	)		(8	)
Total	$	(6,545	)	$	(10,206	)

	Amount of Gain/(Loss) Reclassified from AOCI into Income
	Three months ended						Expected to be Reclassified
Cash Flow Hedges	April 1, 2012			March 27, 2011			Over the Next Twelve Months
Foreign currency contracts(a)	$	2,421		$	(6,007	)	$	(4,535	)
Natural gas contracts(a)		(318	)		(258	)		262
Interest rate swaps—unsecured commercial paper(b)		(967	)		(1,350	)		(1,886	)
Total	$	1,136		$	(7,615	)	$	(6,159	)

(a) Gain/(loss) reclassified from accumulated other comprehensive income (AOCI) to income is included in cost of goods sold.

(b) Gain/(loss) reclassified from AOCI to income is included in financial services interest expense.

For the three months ended April 1, 2012 and March 27, 2011, the cash flow hedges were highly effective and, as a result, the amount of hedge ineffectiveness was not material. No amounts were excluded from effectiveness testing.

For the three months ended April 1, 2012 and March 27, 2011, there were no gains or losses recognized in income related to derivative financial instruments designated as fair value hedges.

For the three months ended April 1, 2012 and March 27, 2011, there were no gains or losses recognized in income related to derivative financial instruments not designated as hedging instruments.

The Company is exposed to credit loss risk in the event of non-performance by counterparties to these derivative financial instruments. Although no assurances can be given, the Company does not expect any of the counterparties to these derivative financial instruments to fail to meet its obligations. To manage credit loss risk, the Company selects counterparties based on credit ratings and, on a quarterly basis, evaluates each hedge's net position relative to the counterparty's ability to cover its position.

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Product Warranty And Safety Recall Campaigns (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Product Warranty And Safety Recall Campaigns [Abstract]
Liability for safety recall campaigns	$ 8.0	$ 3.4

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Fair Value Measurements

3 Months Ended

Apr. 01, 2012

Fair Value Measurements [Abstract]

Fair Value Measurements

8. Fair Value Measurements

Certain assets and liabilities are recorded at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when a significant event occurs. In determining fair value of assets and liabilities, the Company uses various valuation techniques. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment.

The Company assesses the inputs used to measure fair value using a three-tier hierarchy. The hierarchy indicates the extent to which inputs used in measuring fair value are observable in the market. Level 1 inputs include quoted prices for identical instruments and are the most observable. Level 2 inputs include quoted prices for similar assets and observable inputs such as interest rates, foreign currency exchange rates, commodity rates and yield curves. The Company uses the market approach to derive the fair value for its level 2 fair value measurements. Foreign currency exchange contracts are valued using publicly quoted spot and forward prices; commodity contracts are valued using publicly quoted prices, where available, or dealer quotes; interest rate swaps are valued using publicized swap curves; and investments in marketable debt and equity securities are valued using publicly quoted prices.

Level 3 inputs are not observable in the market and include management's judgments about the assumptions market participants would use in pricing the asset or liability. The use of observable and unobservable inputs is reflected in the hierarchy assessment disclosed in the following tables.

Recurring Fair Value Measurements

The following tables present information about the Company's assets and liabilities measured at fair value on a recurring basis (in thousands):

April 1, 2012
	Balance as of April 1, 2012		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	997,669	$	997,669	$	—	$	—
Marketable securities		134,946		—		134,946		—
Derivatives		6,345		—		6,345		—
	$	1,138,960	$	997,669	$	141,291	$	—
Liabilities:
Derivatives	$	2,234	$	—	$	2,234	$	—

	December 31, 2011
	Balance as of December 31, 2011		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	1,302,367	$	1,302,367	$	—	$	—
Marketable securities		153,380		—		153,380		—
Derivatives		16,443		—		16,443		—
	$	1,472,190	$	1,302,367	$	169,823	$	—
Liabilities:
Derivatives	$	5,136	$	—	$	5,136	$	—

	March 27, 2011
	Balance as of March 27, 2011		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	593,344	$	593,344	$	—	$	—
Marketable securities		115,209		59,977		55,232		—
Derivatives		18		—		18		—
	$	708,571	$	653,321	$	55,250	$	—
Liabilities:
Derivatives	$	24,787	$	—	$	24,787	$	—

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Fair Value Of Financial Instruments

3 Months Ended

Apr. 01, 2012

Fair Value Of Financial Instruments [Abstract]

Fair Value Of Financial Instruments

9. Fair Value of Financial Instruments

The Company's financial instruments consist primarily of cash and cash equivalents, marketable securities, trade receivables, finance receivables, net, trade payables, debt, foreign currency contracts and interest rate swaps (derivative instruments are discussed further in Note 10). Under U.S. GAAP, certain of these items are required to be recorded in the financial statements at fair value, while others are required to be recorded at historical cost.

The following table summarizes the fair value and carrying value of the Company's financial instruments (in thousands):

	April 1, 2012				December 31, 2011				March 27, 2011
	Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value
Assets:
Cash and cash equivalents	$	1,276,337	$	1,276,337	$	1,526,950	$	1,526,950	$	932,515	$	932,515
Marketable securities	$	134,946	$	134,946	$	153,380	$	153,380	$	115,209	$	115,209
Accounts receivable, net	$	264,272	$	264,272	$	219,039	$	219,039	$	297,671	$	297,671
Derivatives	$	6,345	$	6,345	$	16,443	$	16,443	$	18	$	18
Finance receivables, net	$	5,961,825	$	5,877,403	$	5,888,040	$	5,786,681	$	6,105,350	$	6,025,423
Restricted cash held by variable interest entities	$	246,995	$	246,995	$	229,655	$	229,655	$	294,903	$	294,903
Liabilities:
Accounts payable	$	355,902	$	355,902	$	255,713	$	255,713	$	292,676	$	292,676
Derivatives	$	2,234	$	2,234	$	5,136	$	5,136	$	24,787	$	24,787
Unsecured commercial paper	$	662,343	$	662,343	$	874,286	$	874,286	$	488,493	$	488,493
Credit facilities	$	150,195	$	150,195	$	159,794	$	159,794	$	217,651	$	217,651
Medium-term notes	$	2,936,475	$	2,698,232	$	2,561,458	$	2,298,193	$	2,514,092	$	2,347,624
Senior unsecured notes	$	366,651	$	303,000	$	376,513	$	303,000	$	406,961	$	303,000
Term asset-backed securitization debt	$	1,768,140	$	1,754,320	$	2,099,060	$	2,087,346	$	2,366,270	$	2,324,763

Cash and Cash Equivalents, Restricted Cash, Accounts Receivable, Net and Accounts Payable – With the exception of certain money-market investments, these items are recorded in the financial statements at historical cost. The historical cost basis for these amounts is estimated to approximate their respective fair values due to the short maturity of these instruments.

Marketable Securities – Marketable securities are recorded in the financial statements at fair value. The fair value of marketable securities is based primarily on quoted market prices of similar financial assets. Changes in fair value are recorded, net of tax, as other comprehensive income and included as a component of shareholders' equity. Fair Value is based on Level 2 inputs.

Finance Receivables, Net – Finance receivables, net includes finance receivables held for investment, net and restricted finance receivables held by VIEs, net. Retail and wholesale finance receivables are recorded in the financial statements at historical cost less a provision for credit losses. The fair value of retail finance receivables is generally calculated by discounting future cash flows using an estimated discount rate that reflects current credit, interest rate and prepayment risks associated with similar types of instruments. Fair value is determined based on Level 3 inputs. The historical cost basis of wholesale finance receivables approximates fair value because they either are short-term or have interest rates that adjust with changes in market interest rates.

Debt – Debt is generally recorded in the financial statements at historical cost. The carrying value of debt provided under credit facilities approximates fair value since the interest rates charged under the facilities are tied directly to market rates and fluctuate as market rates change. The carrying value of unsecured commercial paper approximates fair value due to its short maturity. Fair value is calculated using Level 2 inputs.

The fair values of the medium-term notes maturing in December 2012, December 2014, March 2016, March 2017 and June 2018 are estimated based upon rates currently available for debt with similar terms and remaining maturities. Fair value is calculated using Level 2 inputs.

The fair value of the senior unsecured notes is estimated based upon rates currently available for debt with similar terms and remaining maturities. Fair value is calculated using Level 2 inputs.

The fair value of the debt related to term asset-backed securitization transactions is estimated based on pricing currently available for transactions with similar terms and maturities. Fair value is calculated using Level 2 inputs.

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Income Taxes

3 Months Ended

Apr. 01, 2012

Income Taxes [Abstract]

Income Taxes

11. Income Taxes

The Company's first quarter 2012 income tax rate was 35.3% compared to 34.8% for the same period last year. The first quarter of 2011 was favorably impacted by the Federal research and development credit that expired at the end of 2011.

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Employee Benefit Plans (Components Of Net Periodic Benefit Costs) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Defined Benefit Plan Disclosure [Line Items]
Curtailment loss	$ 200
Pension And SERPA Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	8,420	9,273
Interest cost	20,816	20,147
Expected return on plan assets	(29,277)	(26,653)
Prior service cost (credit)	740	745
Net loss	10,969	7,554
Curtailment loss		236
Net periodic benefit cost	11,668	11,302
Postretirement Healthcare Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	1,853	1,907
Interest cost	4,578	4,911
Expected return on plan assets	(2,356)	(2,346)
Prior service cost (credit)	(963)	(969)
Net loss	1,855	1,798
Net periodic benefit cost	$ 4,967	$ 5,301

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Commitment And Contingencies (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Apr. 01, 2012
Commitment And Contingencies [Line Items]
Estimate of Company's share of York environmental matters	$ 3.3
Harley Davidson, Inc. [Member]
Commitment And Contingencies [Line Items]
Portion of settlement contribution percentage	47.00%
Navy [Member]
Commitment And Contingencies [Line Items]
Portion of settlement contribution percentage	53.00%

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Employee Benefit Plans (Narrative) (Details) (USD $)	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011	Dec. 31, 2010
Defined Benefit Plan Disclosure [Line Items]
Curtailment loss	$ (200,000)
Pension And Postretirement Healthcare Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Funded status adjustment	(900,000)
Company contributions	200,000,000
Pension And SERPA Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Curtailment loss		(236,000)
Discount rate, benefit obligations	5.76%		5.79%
Other comprehensive income, net of tax	500,000
Postretirement Healthcare Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Discount rate, benefit obligations	5.30%		5.28%
Increase in other comprehensive income	900,000
Company contributions		$ 200,000,000

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Business Segments (Tables)

3 Months Ended

Apr. 01, 2012

Business Segments [Abstract]

Information By Strategic Business Units

	Three months ended
	April 1, 2012		March 27, 2011
Motorcycles net revenue	$	1,273,369	$	1,063,044
Gross profit		456,510		351,866
Selling, administrative and engineering expense		236,995		203,805
Restructuring expense		11,451		22,999
Operating income from Motorcycles		208,064		125,062
Financial services income		156,322		161,886
Financial services expense		88,928		93,951
Operating income from Financial Services		67,394		67,935
Operating income	$	275,458	$	192,997

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Finance Receivables (Recorded Investment Of Wholesale Finance Receivables By Internal Credit Quality Indicator) (Details) (Wholesale [Member], USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	$ 956,322	$ 824,640	$ 959,952
Doubtful [Member]
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	13,108	13,048	20,550
Substandard [Member]
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	5,599	5,052	19,510
Special Mention [Member]
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	8,618	14,361	21,069
Medium Risk [Member]
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	6,365	3,032	16,225
Low Risk [Member]
Financing Receivable, Recorded Investment [Line Items]
Finance receivables, gross	$ 922,632	$ 789,147	$ 882,598

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Commitment And Contingencies

3 Months Ended

Apr. 01, 2012

Commitment And Contingencies [Abstract]

Commitment And Contingencies

16. Commitment and Contingencies

The Company is subject to lawsuits and other claims related to environmental, product and other matters. In determining required reserves related to these items, the Company carefully analyzes cases and considers the likelihood of adverse judgments or outcomes, as well as the potential range of possible loss. The required reserves are monitored on an ongoing basis and are updated based on new developments or new information in each matter.

Environmental Protection Agency Notice

In December 2009, the Company received formal, written requests for information from the United States Environmental Protection Agency (EPA) regarding: (i) certificates of conformity for motorcycle emissions and related designations and labels, (ii) aftermarket parts, and (iii) warranty claims on emissions related components. The Company promptly submitted written responses to the EPA's inquiry and engaged in discussions with the EPA. It is possible that a result of the EPA's investigation will be some form of enforcement action by the EPA that will seek a fine or other relief. However, at this time the Company does not know and cannot reasonably estimate the impact of any remedies the EPA might seek.

York Environmental Matters:

The Company is involved with government agencies and groups of potentially responsible parties in various environmental matters, including a matter involving the cleanup of soil and groundwater contamination at its York, Pennsylvania facility. The York facility was formerly used by the U.S. Navy and AMF prior to the purchase of the York facility by the Company from AMF in 1981. Although the Company is not certain as to the full extent of the environmental contamination at the York facility, it has been working with the Pennsylvania Department of Environmental Protection (PADEP) since 1986 in undertaking environmental investigation and remediation activities, including an ongoing site-wide remedial investigation/feasibility study (RI/FS). In January 1995, the Company entered into a settlement agreement (the Agreement) with the Navy. The Agreement calls for the Navy and the Company to contribute amounts into a trust equal to 53% and 47%, respectively, of future costs associated with environmental investigation and remediation activities at the York facility (Response Costs). The trust administers the payment of the Response Costs incurred at the York facility as covered by the Agreement.

In February 2002, the Company was advised by the EPA that it considers some of the Company's remediation activities at the York facility to be subject to the EPA's corrective action program under the Resource Conservation and Recovery Act (RCRA) and offered the Company the option of addressing corrective action under a RCRA facility lead agreement. In July 2005, the York facility was designated as the first site in Pennsylvania to be addressed under the "One Cleanup Program." The program provides a more streamlined and efficient oversight of voluntary remediation by both PADEP and EPA and will be carried out consistent with the Agreement with the Navy. As a result, the RCRA facility lead agreement has been superseded.

The Company estimates that its share of the future Response Costs at the York facility will be approximately $3.3 million and has established a reserve for this amount which is included in accrued liabilities in the Condensed Consolidated Balance Sheets. As noted above, the RI/FS is still underway and given the uncertainty that exists concerning the nature and scope of additional environmental investigation and remediation that may ultimately be required under the RI/FS or otherwise at the York facility, we are unable to make a reasonable estimate of those additional costs, if any, that may result.

The estimate of the Company's future Response Costs that will be incurred at the York facility is based on reports of independent environmental consultants retained by the Company, the actual costs incurred to date and the estimated costs to complete the necessary investigation and remediation activities. Response Costs related to the remediation of soil are expected to be incurred primarily over a period of several years ending in 2015. Response Costs related to ground water remediation may continue for some time beyond 2015.

Product Liability Matters:

Additionally, the Company is involved in product liability suits related to the operation of its business. The Company accrues for claim exposures that are probable of occurrence and can be reasonably estimated. The Company also maintains insurance coverage for product liability exposures. The Company believes that its accruals and insurance coverage are adequate and that product liability will not have a material adverse effect on the Company's consolidated financial statements.

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Finance Receivables (Tables)

3 Months Ended

Apr. 01, 2012

Finance Receivables [Abstract]

Finance Receivables

	April 1,			December 31,			March 27,
	2012			2011			2011
Retail	$	5,043,584		$	5,087,490		$	5,225,155
Wholesale		956,322			824,640			959,952
		5,999,906			5,912,130			6,185,107
Allowance for credit losses		(122,503	)		(125,449	)		(159,684	)
	$	5,877,403		$	5,786,681		$	6,025,423

Changes In The Allowance For Credit Losses On Finance Receivables

	Three months ended April 1, 2012
	Retail			Wholesale		Total
Balance, beginning of period	$	116,112		$	9,337	$	125,449
Provision for credit losses		8,705			309		9,014
Charge-offs		(25,852	)		—		(25,852	)
Recoveries		13,892			—		13,892
Balance, end of period	$	112,857		$	9,646	$	122,503
	Three months ended March 27, 2011
	Retail			Wholesale		Total
Balance, beginning of period	$	157,791		$	15,798	$	173,589
Provision for credit losses		3,439			2,167		5,606
Charge-offs		(35,191	)		—		(35,191	)
Recoveries		15,665			15		15,680
Balance, end of period	$	141,704		$	17,980	$	159,684

Allowance For Credit Losses And Finance Receivables By Portfolio Individually And Collectively Evaluated For Impairment

	April 1, 2012
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		112,857		9,646		122,503
Total allowance for credit losses	$	112,857	$	9,646	$	122,503
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		5,043,584		956,322		5,999,906
Total finance receivables	$	5,043,584	$	956,322	$	5,999,906
	December 31, 2011
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		116,112		9,337		125,449
Total allowance for credit losses	$	116,112	$	9,337	$	125,449
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	—	$	—
Collectively evaluated for impairment		5,087,490		824,640		5,912,130
Total finance receivables	$	5,087,490	$	824,640	$	5,912,130
	March 27, 2011
	Retail		Wholesale		Total
Allowance for credit losses, ending balance:
Individually evaluated for impairment	$	—	$	3,451	$	3,451
Collectively evaluated for impairment		141,704		14,529		156,233
Total allowance for credit losses	$	141,704	$	17,980	$	159,684
Finance receivables, ending balance:
Individually evaluated for impairment	$	—	$	5,187	$	5,187
Collectively evaluated for impairment		5,225,155		954,765		6,179,920
Total finance receivables	$	5,225,155	$	959,952	$	6,185,107

Finance Receivables That Are Individually Deemed To Be Impaired

			Unpaid				Average		Interest
	Recorded		Principal		Related		Recorded		Income
	Investment		Balance		Allowance		Investment		Recognized
Wholesale:
No related allowance recorded	$	—	$	—	$	—	$	—	$	—
Related allowance recorded		5,187		5,037		3,451		5,527		—
Total impaired wholesale finance receivables	$	5,187	$	5,037	$	3,451	$	5,527	$	—

Aging Of Past Due Finance Receivables Including Non-Accrual Status Finance Receivables

	April 1, 2012
							Greater than				Total
			31-60 Days		61-90 Days		90 Days		Total		Finance
	Current		Past Due		Past Due		Past Due		Past Due		Receivables
Retail	$	4,930,739	$	75,560	$	21,023	$	16,262	$	112,845	$	5,043,584
Wholesale		955,493		354		149		326		829		956,322
Total	$	5,886,232	$	75,914	$	21,172	$	16,588	$	113,674	$	5,999,906
	December 31, 2011
							Greater than				Total
			31-60 Days		61-90 Days		90 Days		Total		Finance
	Current		Past Due		Past Due		Past Due		Past Due		Receivables
Retail	$	4,915,711	$	107,373	$	36,937	$	27,469	$	171,779	$	5,087,490
Wholesale		822,610		777		344		909		2,030		824,640
Total	$	5,738,321	$	108,150	$	37,281	$	28,378	$	173,809	$	5,912,130
	March 27, 2011
							Greater than				Total
			31-60 Days		61-90 Days		90 Days		Total		Finance
	Current		Past Due		Past Due		Past Due		Past Due		Receivables
Retail	$	5,059,870	$	107,471	$	32,691	$	25,123	$	165,285	$	5,225,155
Wholesale		955,478		881		895		2,698		4,474		959,952
Total	$	6,015,348	$	108,352	$	33,586	$	27,821	$	169,759	$	6,185,107

Recorded Investment Of Retail Finance Receivables By Credit Quality Indicator

	April 1, 2012		December 31, 2011		March 27, 2011
Prime	$	4,056,602	$	4,097,048	$	4,185,825
Sub-prime		986,982		990,442		1,039,330
Total	$	5,043,584	$	5,087,490	$	5,225,155

Recorded Investment Of Wholesale Finance Receivables By Internal Credit Quality Indicator

	April 1, 2012		December 31, 2011		March 27, 2011
Doubtful	$	13,108	$	13,048	$	20,550
Substandard		5,599		5,052		19,510
Special Mention		8,618		14,361		21,069
Medium Risk		6,365		3,032		16,225
Low Risk		922,632		789,147		882,598
Total	$	956,322	$	824,640	$	959,952

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Finance Receivables (Aging Of Past Due Finance Receivables Including Non-Accrual Status Finance Receivables) (Details) (USD $) In Thousands, unless otherwise specified	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	$ 5,999,906	$ 5,912,130	$ 6,185,107
Retail [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	5,043,584	5,087,490	5,225,155
Wholesale [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	956,322	824,640	959,952
Current [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	5,886,232	5,738,321	6,015,348
Current [Member] | Retail [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	4,930,739	4,915,711	5,059,870
Current [Member] | Wholesale [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	955,493	822,610	955,478
31-60 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	75,914	108,150	108,352
31-60 Days Past Due [Member] | Retail [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	75,560	107,373	107,471
31-60 Days Past Due [Member] | Wholesale [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	354	777	881
61-90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	21,172	37,281	33,586
61-90 Days Past Due [Member] | Retail [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	21,023	36,937	32,691
61-90 Days Past Due [Member] | Wholesale [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	149	344	895
Greater Than 90 Days Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	16,588	28,378	27,821
Greater Than 90 Days Past Due [Member] | Retail [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	16,262	27,469	25,123
Greater Than 90 Days Past Due [Member] | Wholesale [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	326	909	2,698
Total Past Due [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	113,674	173,809	169,759
Total Past Due [Member] | Retail [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	112,845	171,779	165,285
Total Past Due [Member] | Wholesale [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Finance receivables, gross	$ 829	$ 2,030	$ 4,474

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Restructuring Expense (Restructuring Plan Reserve Recorded In Accrued Liabilities Related To The 2011 Plan) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
2011 Restructuring Plan [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	$ 12,856
Restructuring expense	3,561
Utilized - cash	(517)
Utilized - noncash	(2,099)
Balance, end of period	13,801
2011 Kansas City Restructuring Plan [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	4,123
Restructuring expense	542	6,516
Utilized - cash		(134)
Utilized - noncash		(236)
Balance, end of period	4,665	6,146
2011 Kansas City Restructuring Plan [Member] | Employee Severance And Termination Costs [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	4,123
Restructuring expense	542	6,382
Utilized - noncash		(236)
Balance, end of period	4,665	6,146
2011 Kansas City Restructuring Plan [Member] | Other [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period
Restructuring expense		134
Utilized - cash		(134)
Utilized - noncash
Balance, end of period
2011 New Castalloy Restructuring Plan [Member]
Restructuring Cost and Reserve [Line Items]
Utilized - noncash	(30,000)
2011 New Castalloy Restructuring Plan [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	8,733
Restructuring expense	3,019
Utilized - cash	(517)
Utilized - noncash	(2,099)
Balance, end of period	9,136
2011 New Castalloy Restructuring Plan [Member] | Employee Severance And Termination Costs [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	8,428
Restructuring expense	571
Utilized - cash	(156)
Utilized - noncash
Balance, end of period	8,843
2011 New Castalloy Restructuring Plan [Member] | Accelerated Depreciation [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period
Restructuring expense	2,099
Utilized - cash
Utilized - noncash	(2,099)
Balance, end of period
2011 New Castalloy Restructuring Plan [Member] | Other [Member] | Motorcycles & Related Products [Member]
Restructuring Cost and Reserve [Line Items]
Balance, beginning of period	305
Restructuring expense	349
Utilized - cash	(361)
Utilized - noncash
Balance, end of period	$ 293

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Condensed Consolidated Statements Of Cash Flows (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Mar. 27, 2011
Condensed Consolidated Statements Of Cash Flows [Abstract]
Net cash used by operating activities of continuing operations (Note 3)	$ (73,616)	$ (104,918)
Cash flows from investing activities of continuing operations:
Capital expenditures	(24,680)	(27,704)
Origination of finance receivables	(645,247)	(549,200)
Collections on finance receivables	681,904	676,952
Purchases of marketable securities		(5,000)
Sales and redemptions of marketable securities	20,042	29,974
Net cash provided by investing activities of continuing operations	32,019	125,022
Cash flows from financing activities of continuing operations:
Proceeds from issuance of medium-term notes	397,377	447,076
Repayments of securitization debt	(333,026)	(430,471)
Net decrease in credit facilities and unsecured commercial paper	(224,508)	(96,174)
Net change in restricted cash	(17,340)	(6,016)
Dividends	(35,943)	(23,643)
Purchase of common stock for treasury	(20,745)	(4,699)
Excess tax benefits from share-based payments	7,962	3,262
Issuance of common stock under employee stock option plans	16,281	3,861
Net cash used by financing activities of continuing operations	(209,942)	(106,804)
Effect of exchange rate changes on cash and cash equivalents of continuing operations	926	(2,693)
Net decrease in cash and cash equivalents of continuing operations	(250,613)	(89,393)
Cash flows from discontinued operations:
Cash flows from operating activities of discontinued operations		(25)
Cash flows from investing activities of discontinued operations
Effect of exchange rate changes on cash and cash equivalents of discontinued operations
Net cash used by discontinued operations, total		(25)
Net decrease in cash and cash equivalents	(250,613)	(89,418)
Cash and cash equivalents:
Cash and cash equivalents - beginning of period	1,526,950	1,021,933
Cash and cash equivalents of discontinued operations - beginning of period
Net decrease in cash and cash equivalents	(250,613)	(89,418)
Less: Cash and cash equivalents of discontinued operations - end of period
Cash and cash equivalents - end of period	$ 1,276,337	$ 932,515

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Restructuring Expense

3 Months Ended

Apr. 01, 2012

Restructuring Expense [Abstract]

Restructuring Expense

5. Restructuring Expense

2011 Restructuring Plans

In December 2011, the Company made a decision to cease operations at New Castalloy, its Australian subsidiary and producer of cast motorcycle wheels and wheel hubs, and source those components through other existing suppliers (2011 New Castalloy Restructuring Plan). The Company expects the transition of supply from New Castalloy to be complete by mid-2013. The decision to close New Castalloy comes as part of the Company's overall long term strategy to develop world-class manufacturing capability throughout the Company by restructuring and consolidating operations for greater competitiveness, efficiency and flexibility. In connection with this decision, the Company will reduce its workforce by approximately 200 employees by mid-2013.

Under the 2011 New Castalloy Restructuring Plan, restructuring expenses consist of employee severance and termination costs, accelerated depreciation and other related costs. The Company expects to incur about $30 million in restructuring charges related to the transition through 2013. Approximately 35% of the $30 million will be non-cash charges. On a cumulative basis, the Company has incurred $12.4 million of restructuring expense under the 2011 New Castalloy Restructuring Plan as of April 1, 2012, of which $3.0 million was incurred during the first quarter of 2012.

In February 2011, the Company's unionized employees at its facility in Kansas City, Missouri ratified a new seven-year labor agreement. The new agreement took effect on August 1, 2011. The new contract is similar to the labor agreements ratified at the Company's Wisconsin facilities in September 2010 and its York, Pennsylvania facility in December 2009, and allows for similar flexibility and increased production efficiency. Once the new contract is fully implemented, the production system in Kansas City, like Wisconsin and York, will include the addition of a flexible workforce component.

After taking actions to implement the new ratified labor agreement (2011 Kansas City Restructuring Plan), the Company expects to have about 145 fewer full-time hourly unionized employees in its Kansas City facility than would have been required under the prior contract.

Under the 2011 Kansas City Restructuring Plan, restructuring expenses consist of employee severance and termination costs and other related costs. The Company expects to incur approximately $15 million in restructuring expenses related to the new contract through 2012, of which approximately 10% are expected to be non-cash. On a cumulative basis, the Company has incurred $9.3 million of restructuring expense under the 2011 Kansas City Restructuring Plan as of April 1, 2012, of which $0.5 million was incurred during the first quarter of 2012.

For the three months ended March 27, 2011, restructuring expense included $0.2 million of noncash curtailment losses related to the Company's pension plan that covers employees of the Kansas City facility.

The following table summarizes the Motorcycle segment's 2011 Kansas City Restructuring Plan and 2011 New Castalloy Restructuring Plan reserve activity and balances as recorded in accrued liabilities (in thousands):

		00000000			00000000			00000000			00000000			00000000			00000000			00000000			00000000
	Three months ended April 1, 2012
	Kansas City									New Castalloy												Consolidated
	Employee									Employee
	Severance and									Severance and
	Termination									Termination			Accelerated
	Costs			Other			Total			Costs			Depreciation			Other			Total			Total
Balance, beginning of period	$	4,123		$	—		$	4,123		$	8,428		$	—		$	305		$	8,733		$	12,856
Restructuring expense		542			—			542			571			2,099			349			3,019			3,561
Utilized—cash		—			—			—			(156	)		—			(361	)		(517	)		(517	)
Utilized—noncash		—			—			—			—			(2,099	)		—			(2,099	)		(2,099	)
Balance, end of period	$	4,665		$	—		$	4,665		$	8,843		$	—		$	293		$	9,136		$	13,801
	Three months ended March 27, 2011
	Kansas City
	Employee
	Severance and
	Termination
	Costs			Other			Total
Restructuring expense		6,382			134			6,516
Utilized—cash		—			(134	)		(134	)
Utilized—noncash		(236	)		—			(236	)
Balance, end of period	$	6,146		$	—		$	6,146

2010 Restructuring Plan

In September 2010, the Company's unionized employees in Wisconsin ratified three separate new seven-year labor agreements which took effect in April 2012 when the prior contracts expired. The new contracts are similar to the labor agreement ratified at the Company's York, Pennsylvania facility in December 2009 and allow for similar flexibility and increased production efficiency. Once the new contracts are fully implemented, the production system in Wisconsin, like York, will include the addition of a flexible workforce component.

Based on the new ratified labor agreements (2010 Restructuring Plan), the Company expects to have about 250 fewer full-time hourly unionized employees in its Milwaukee-area facilities when the contracts are fully implemented than would have been required under the prior contract. In Tomahawk, the Company expects to have about 75 fewer full-time hourly unionized employees when the contract is fully implemented than would have been required under the prior contract.

Under the 2010 Restructuring Plan, restructuring expenses consist of employee severance and termination costs and other related costs. The Company expects to incur approximately $67 million in restructuring expenses related to the new contracts through 2012, of which approximately 42% are expected to be non-cash. On a cumulative basis, the Company has incurred $61.5 million of restructuring expense under the 2010 Restructuring Plan as of April 1, 2012, of which $4.5 million was incurred during the first quarter of 2012.

The following table summarizes the Motorcycles segment's 2010 Restructuring Plan reserve activity and balances as recorded in accrued liabilities (in thousands):

	Three months ended April 1, 2012			Three months ended March 27, 2011
	Employee Severance and Termination Costs			Employee Severance and Termination Costs
Balance, beginning of period	$	20,361		$	8,652
Restructuring expense		1,886			3,144
Utilized - cash		(26	)		(594	)
Balance, end of period	$	22,221		$	11,202

2009 Restructuring Plan

During 2009, in response to the U.S. economic recession and worldwide slowdown in consumer demand, the Company committed to a volume reduction and a combination of restructuring actions (2009 Restructuring Plan) that are expected to be completed at various dates between 2009 and 2012. The actions were designed to reduce administrative costs, eliminate excess capacity and exit non-core business operations. The Company's significant announced actions include the restructuring and transformation of its York, Pennsylvania production facility including the implementation of a new more flexible unionized labor agreement; consolidation of facilities related to engine and transmission production; outsourcing of certain distribution and transportation activities and exiting the Buell product line.

The 2009 Restructuring Plan included a reduction of approximately 2,700 to 2,900 hourly production positions and approximately 720 non-production, primarily salaried positions within the Motorcycles segment and approximately 100 salaried positions in the Financial Services segment.

Under the 2009 Restructuring Plan, restructuring expenses consist of employee severance and termination costs, accelerated depreciation on the long-lived assets that will be exited as part of the 2009 Restructuring Plan and other related costs. The Company expects total costs related to the 2009 Restructuring Plan to result in restructuring and impairment expenses of approximately $388 million to $408 million from 2009 to 2012, of which approximately 30% are expected to be non-cash. On a cumulative basis, the Company has incurred $386.6 million of restructuring and impairment expense under the 2009 Restructuring Plan as of April 1, 2012, of which $3.3 million was incurred during the first quarter of 2012. Approximately 3,600 employees have left the Company under the 2009 Restructuring Plan as of April 1, 2012.

The following table summarizes the Company's 2009 Restructuring Plan reserve activity and balances recorded in accrued liabilities (in thousands):

	Three months ended April 1, 2012
	Motorcycles & Related Products
	Employee Severance and Termination Costs			Accelerated Depreciation		Other			Total
Balance, beginning of period	$	10,089		$	—	$	—		$	10,089
Restructuring expense		323			—		5,681			6,004
Utilized - cash		(1,846	)		—		(5,669	)		(7,515	)
Utilized - noncash		—			—		—			—
Balance, end of period	$	8,566		$	—	$	12		$	8,578
	Three months ended March 27, 2011
	Motorcycles & Related Products
	Employee Severance and Termination Costs			Accelerated Depreciation		Other			Total
Balance, beginning of period	$	23,818		$	—	$	2,764		$	26,582
Restructuring expense		2,954			—		10,385			13,339
Utilized - cash		(4,028	)		—		(10,546	)		(14,574	)
Utilized - noncash		—			—		296			296
Balance, beginning of period	$	22,744		$	—	$	2,899		$	25,643

Other restructuring costs under the 2009 Restructuring Plan include items such as the exit costs for terminating supply contracts, lease termination costs and moving costs. During the first quarter of 2012, the Company released $2.7 million of its 2009 Restructuring Plan reserve related to employee severance costs as these costs are no longer expected to be incurred.

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Derivative Instruments And Hedging Activities (Gain (Loss) On Derivative Cash Flow Hedges Reclassified From AOCI Into Income) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012		Mar. 27, 2011
Derivative Instruments And Hedging Activities [Line Items]
Amount of Gain/(Loss) Reclassified from AOCI into Income	$ 1,136		$ (7,615)
Expected to be Reclassified Over the Next Twelve Months	(6,159)
Cash Flow Hedges [Member] | Foreign Currency Contracts [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of (Loss) Reclassified from AOCI into Income			(6,007)	[1]
Amount of Gain Reclassified from AOCI into Income	2,421	[1]
Expected to be Reclassified Over the Next Twelve Months	(4,535)	[1]
Cash Flow Hedges [Member] | Natural Gas Contracts [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of (Loss) Reclassified from AOCI into Income	(318)	[1]	(258)	[1]
Expected to be Reclassified Over the Next Twelve Months	262	[1]
Cash Flow Hedges [Member] | Interest Rate Swaps - Unsecured Commercial Paper [Member]
Derivative Instruments And Hedging Activities [Line Items]
Amount of (Loss) Reclassified from AOCI into Income	(967)	[2]	(1,350)	[2]
Expected to be Reclassified Over the Next Twelve Months	$ (1,886)	[2]

[1] Gain/(loss) reclassified from accumulated other comprehensive income (AOCI) to income is included in cost of goods sold.

[2] Gain/(loss) reclassified from AOCI to income is included in financial services interest expense.

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Supplemental Consolidating Data (Cash Flows) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011
Segment Reporting Information [Line Items]
Income from continuing operations	$ 172,035		$ 119,260
Depreciation	43,203		42,947
Amortization of deferred loan origination costs	18,547		19,329
Amortization of financing origination fees	2,743		3,107
Provision for employee long-term benefits	17,293		15,563
Contributions to pension and postretirement plans	(206,832)		(204,816)
Stock compensation expense	11,744		9,153
Net change in wholesale finance receivables	(151,046)		(163,967)
Provision for credit losses	9,014		5,606
Pension and postretirement healthcare plan curtailment and settlement expense			236
Foreign currency adjustments	(2,911)		29
Other, net	1,505		14,112
Accounts receivable	(43,745)		(27,048)
Finance receivables - accrued interest and other	3,299		3,542
Inventories	(47,168)		(38,200)
Accounts payable and accrued liabilities	117,460		98,960
Restructuring reserves	1,296	7,500	7,757
Derivative instruments	(486)		2,157
Other	(19,567)		(12,645)
Total adjustments	245,651		224,178
Net cash (used by) provided by operating activities of continuing operations	(73,616)		(104,918)
Capital expenditures	(24,680)		(27,704)
Origination of finance receivables	(645,247)		(549,200)
Collections of finance receivables	681,904		676,952
Purchases of marketable securities			(5,000)
Sales and redemptions of marketable securities	20,042		29,974
Net cash (used by) provided by investing activities of continuing operations	32,019		125,022
Proceeds from issuance of medium-term notes	397,377		447,076
Repayments of securitization debt	(333,026)		(430,471)
Net borrowings of unsecured commercial paper	(211,669)
Net decrease in credit facilities	(12,839)
Net decrease in credit facilities and unsecured commercial paper	(224,508)		(96,174)
Net change in restricted cash	(17,340)		(6,016)
Dividends paid	(35,943)		(23,643)
Purchase of common stock for treasury	(20,745)		(4,699)
Excess tax benefits from share based payments	7,962		3,262
Issuance of common stock under employee stock option plans	16,281		3,861
Net cash used by financing activities of continuing operations	(209,942)		(106,804)
Effect of exchange rate changes on cash and cash equivalents of continuing operations	926		(2,693)
Net (decrease) increase in cash and cash equivalents of continuing operations	(250,613)		(89,393)
Cash flows from operating activities of discontinued operations			(25)
Cash flows from investing activities of discontinued operations
Effect of exchange rate changes on cash and cash equivalents of discontinued operations
Net cash provided by (used in) discontinued operations			(25)
Net (decrease) increase in cash and cash equivalents	(250,613)		(89,418)
Cash and cash equivalents - beginning of period	1,526,950		1,021,933
Cash and cash equivalents of discontinued operations - beginning of period
Net (decrease) increase in cash and cash equivalents	(250,613)		(89,418)
Less: Cash and cash equivalents of discontinued operations - end of period
Cash and cash equivalents - end of period	1,276,337	1,526,950	932,515
Motorcycles & Related Products Operations [Member]
Segment Reporting Information [Line Items]
Income from continuing operations	355,714		202,433
Depreciation	41,708		41,340
Amortization of financing origination fees	118		118
Provision for employee long-term benefits	16,780		16,445
Contributions to pension and postretirement plans	(206,832)		(204,816)
Stock compensation expense	10,967		8,481
Pension and postretirement healthcare plan curtailment and settlement expense			236
Foreign currency adjustments	(2,911)		29
Other, net	(1,954)		1,884
Accounts receivable	(186,466)		(167,885)
Inventories	(47,168)		(38,200)
Accounts payable and accrued liabilities	57,993		39,517
Restructuring reserves	1,296		7,757
Derivative instruments	(390)		2,178
Other	(18,058)		(12,706)
Total adjustments	334,917		305,622
Net cash (used by) provided by operating activities of continuing operations	20,797		(103,189)
Capital expenditures	(23,441)		(26,460)
Purchases of marketable securities			(5,000)
Sales and redemptions of marketable securities	20,042		29,974
Net cash (used by) provided by investing activities of continuing operations	(3,399)		(1,486)
Dividends paid	(35,943)		(23,643)
Purchase of common stock for treasury	(20,745)		(4,699)
Excess tax benefits from share based payments	7,962		3,262
Issuance of common stock under employee stock option plans	16,281		3,861
Net cash used by financing activities of continuing operations	(32,445)		(21,219)
Effect of exchange rate changes on cash and cash equivalents of continuing operations	745		(2,846)
Net (decrease) increase in cash and cash equivalents of continuing operations	(14,302)		(128,740)
Cash flows from operating activities of discontinued operations			(25)
Net cash provided by (used in) discontinued operations			(25)
Net (decrease) increase in cash and cash equivalents	(14,302)		(128,765)
Cash and cash equivalents - beginning of period	943,330		791,791
Net (decrease) increase in cash and cash equivalents	(14,302)		(128,765)
Cash and cash equivalents - end of period	929,028		663,026
Financial Services Operations [Member]
Segment Reporting Information [Line Items]
Income from continuing operations	41,321		41,827
Depreciation	1,495		1,607
Amortization of deferred loan origination costs	18,547		19,329
Amortization of financing origination fees	2,625		2,989
Provision for employee long-term benefits	513		(882)
Stock compensation expense	777		672
Provision for credit losses	9,014		5,606
Other, net	3,459		12,228
Finance receivables - accrued interest and other	3,299		3,542
Accounts payable and accrued liabilities	202,188		152,692
Derivative instruments	(96)		(21)
Other	(1,509)		47,636
Total adjustments	(240,312)		(245,398)
Net cash (used by) provided by operating activities of continuing operations	281,633		287,225
Capital expenditures	(1,239)		(1,244)
Origination of finance receivables	(1,617,867)		(1,406,139)
Collections of finance receivables	1,503,478		1,369,924
Net cash (used by) provided by investing activities of continuing operations	(115,628)		(37,459)
Proceeds from issuance of medium-term notes	397,377		447,076
Repayments of securitization debt	(333,026)		(430,471)
Net borrowings of unsecured commercial paper	(211,669)
Net decrease in credit facilities	(12,839)
Net decrease in credit facilities and unsecured commercial paper			(96,174)
Net change in restricted cash	(17,340)		(6,016)
Dividends paid	(225,000)		(125,000)
Net cash used by financing activities of continuing operations	(402,497)		(210,585)
Effect of exchange rate changes on cash and cash equivalents of continuing operations	181		166
Net (decrease) increase in cash and cash equivalents of continuing operations	(236,311)		39,347
Net (decrease) increase in cash and cash equivalents	(236,311)		39,347
Cash and cash equivalents - beginning of period	583,620		230,142
Net (decrease) increase in cash and cash equivalents	(236,311)		39,347
Cash and cash equivalents - end of period	347,309		269,489
Eliminations & Adjustments [Member]
Segment Reporting Information [Line Items]
Income from continuing operations	(225,000)		(125,000)
Net change in wholesale finance receivables	(151,046)		(163,967)
Accounts receivable	142,721		140,837
Accounts payable and accrued liabilities	(142,721)		(93,249)
Other			(47,575)
Total adjustments	151,046		163,954
Net cash (used by) provided by operating activities of continuing operations	(376,046)		(288,954)
Origination of finance receivables	972,620		856,939
Collections of finance receivables	(821,574)		(692,972)
Net cash (used by) provided by investing activities of continuing operations	151,046		163,967
Dividends paid	225,000		125,000
Net cash used by financing activities of continuing operations	225,000		125,000
Effect of exchange rate changes on cash and cash equivalents of continuing operations			$ (13)

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Asset-Backed Financing (Tables)

3 Months Ended

Apr. 01, 2012

SPEs [Member]

Asset Backed Financing [Line Items]

Schedule Of Assets And Liabilities Of Variable Interest Entities

	April 1, 2012			December 31, 2011			March 27, 2011
Assets:
Finance receivables	$	2,564,585		$	2,916,219		$	3,000,580
Allowance for credit losses		(56,810	)		(65,735	)		(81,631	)
Restricted cash		245,912			228,776			293,090
Other assets		5,620			6,772			10,499
Total assets	$	2,759,307		$	3,086,032		$	3,222,538
Liabilities
Term asset-backed securitization debt	$	1,754,320		$	2,087,346		$	2,324,763

SPE Facility [Member]

Asset Backed Financing [Line Items]

Schedule Of Assets And Liabilities Of Variable Interest Entities

	April 1, 2012			December 31, 2011			March 27, 2011
Finance receivables	$	10,689		$	13,455		$	23,776
Allowance for credit losses		(236	)		(302	)		(645	)
Restricted cash		1,083			879			1,813
Other assets		312			449			598
Total assets	$	11,848		$	14,481		$	25,542

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Additional Balance Sheet And Cash Flow Information (Reconciliation Of Net Income To Net Cash Used By Operating Activities) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Apr. 01, 2012	Dec. 31, 2011	Mar. 27, 2011
Additional Balance Sheet And Cash Flow Information [Abstract]
Net income	$ 172,035		$ 119,260
Loss from discontinued operations
Income from continuing operations	172,035		119,260
Depreciation	43,203		42,947
Amortization of deferred loan origination costs	18,547		19,329
Amortization of financing origination fees	2,743		3,107
Provision for employee long-term benefits	17,293		15,563
Contributions to pension and postretirement plans	(206,832)		(204,816)
Stock compensation expense	11,744		9,153
Net change in wholesale finance receivables related to sales	(151,046)		(163,967)
Provision for credit losses	9,014		5,606
Pension and postretirement healthcare plan curtailment and settlement expense			236
Foreign currency adjustments	(2,911)		29
Other, net	1,505		14,112
Accounts receivable, net	(43,745)		(27,048)
Finance receivables - accrued interest and other	3,299		3,542
Inventories	(47,168)		(38,200)
Accounts payable and accrued liabilities	117,460		98,960
Restructuring reserves	1,296	7,500	7,757
Derivative instruments	(486)		2,157
Other	(19,567)		(12,645)
Total adjustments	245,651		224,178
Net cash used by operating activities of continuing operations	$ (73,616)		$ (104,918)

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Business Segments

3 Months Ended

Apr. 01, 2012

Business Segments [Abstract]

Business Segments

15. Business Segments

The Company operates in two business segments: Motorcycles and Financial Services. The Company's reportable segments are strategic business units that offer different products and services. They are managed separately based on the fundamental differences in their operations. Selected segment information is set forth below (in thousands):

	Three months ended
	April 1, 2012		March 27, 2011
Motorcycles net revenue	$	1,273,369	$	1,063,044
Gross profit		456,510		351,866
Selling, administrative and engineering expense		236,995		203,805
Restructuring expense		11,451		22,999
Operating income from Motorcycles		208,064		125,062
Financial services income		156,322		161,886
Financial services expense		88,928		93,951
Operating income from Financial Services		67,394		67,935
Operating income	$	275,458	$	192,997