-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RtJmalF8E9dq7cUFExH3eofjeTy6JMkUFxkMXpCFAhwgkWECfIYyxVhNcyOOtjLo DswBYGC1PKRKp/pANy8Utw== 0001047469-05-014781.txt : 20050513 0001047469-05-014781.hdr.sgml : 20050513 20050513171610 ACCESSION NUMBER: 0001047469-05-014781 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 20050513 DATE AS OF CHANGE: 20050513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HARLEY DAVIDSON CUSTOMER FUNDING CORP CENTRAL INDEX KEY: 0001114926 STANDARD INDUSTRIAL CLASSIFICATION: ASSET-BACKED SECURITIES [6189] IRS NUMBER: 364396302 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-124935 FILM NUMBER: 05830483 BUSINESS ADDRESS: STREET 1: 4150 TECHNOLOGY WAY CITY: CARSON CITY STATE: NV ZIP: 89706 BUSINESS PHONE: 7028851200 MAIL ADDRESS: STREET 1: 4150 TECHNOLOGY WAY CITY: CARSON CITY STATE: NV ZIP: 89706 S-3 1 a2158269zs-3.htm FORM S-3
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As filed with the Securities and Exchange Commission on May 13, 2005

Registration No. 333-

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

HARLEY-DAVIDSON MOTORCYCLE TRUSTS
(Issuer with respect to the Securities)

HARLEY-DAVIDSON CUSTOMER FUNDING CORP.
(Exact name of Registrant as specified in its charter)

Nevada				36-4396302
(State or other jurisdiction of incorporation or organization)				(IRS Employer Identification No.)
3850 Arrowhead Drive Carson City, Nevada 89706 (775) 886-3000 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices)

Donna F. Zarcone
President and Chief Operating Officer
Harley-Davidson Credit Corp.
150 South Wacker Drive
Suite 3100
Chicago, Illinois 60606
(312) 368-9501
(Name, address, including zip code, and telephone number,
including area code, of agent for service)

Copies of all communications to:

M. David Galainena
Winston & Strawn LLP
35 West Wacker Drive
Chicago, Illinois 60601
(312) 558-5600

Approximate date of commencement of proposed sale to public:
As soon as practicable after the registration statement becomes effective.

If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. o

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. ý

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. o

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Amount to be Registered(1)	Proposed Maximum Offering Price Per Unit(2)	Proposed Maximum Aggregate Offering Price	Amount of Registration Fee


Asset Backed Notes	$1,000,000	100%	$1,000,000	$117.70

(1): The amount of Securities being registered represents the maximum aggregate principal amount of Securities currently expected to be offered for sale. $[ ] aggregate principal amount of the Securities registered by Registrant under Registration Statement No. 333-98975 referred to below and not previously sold are consolidated in this Registration Statement pursuant to Rule 429. All registration fees in the amount of $[ ] in connection with such unsold amount of Securities have previously been paid under Registration Statement No. 333-98975. The total amount registered under this Registration Statement as so consolidated as of the date of this filing is $667,000,000.
(2): Estimated solely for purposes of calculating the registration fee.

Pursuant to Rule 429 under the Securities Act of 1933, the prospectus and prospectus supplement filed as part of this Registration Statement also relate to $[ ] principal amount of Securities previously registered by the Registrant on Form S-3 (File No. 333-98975).

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

Introductory Note

This registration statement contains (i) a prospectus relating to the offering of one or more series of Harley-Davidson Motorcycle Contract Backed Notes by various Harley-Davidson Motorcycle Trusts created from time to time by Harley-Davidson Customer Funding Corp. and (ii) a form of prospectus supplement relating to the offering by a Harley-Davidson Motorcycle Trust of Harley-Davidson Motorcycle Contract Backed Notes described in the form of prospectus supplement. The form of prospectus supplement relates only to the securities described therein and is a form that may be used by the Harley-Davidson Motorcycle Trusts to offer Harley-Davidson Motorcycle Contract Backed Notes under this registration statement. The features applicable to any actual series of securities may include any features specified in the prospectus.

PROSPECTUS SUPPLEMENT
(to Prospectus Dated [ ])

Harley-Davidson Motorcycle Trust [ ]

$[            ] [    ]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-1
$[            ] [    ]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-2
$[            ] [    ]% Harley-Davidson Motorcycle Contract Backed Notes, Class B

Harley-Davidson Customer Funding Corp.
Depositor

Harley-Davidson Credit Corp.
Seller and Servicer

Consider carefully the risk factors beginning on page S-[ ] in this prospectus supplement and on page [ ] of the prospectus.

The notes will represent obligations of Harley-Davidson Motorcycle Trust [ ] only, and will not represent obligations of or interests in Harley-Davidson Financial Services, Inc., Harley-Davidson Credit Corp., Harley-Davidson Customer Funding Corp., Harley-Davidson, Inc. or any of their respective affiliates. This prospectus supplement may be used to offer and sell the notes only if accompanied by the prospectus.

The notes are contract backed notes issued by the trust. Payments on the notes will be made monthly on the [ ] day of each month, or if the [ ] is not a business day, on the next business day immediately following the [ ], beginning on the first payment date for each class of notes identified in the table below. The assets securing the notes are fixed-rate, simple interest, conditional sales contracts and promissory note and security agreements relating to the purchase of new or used motorcycles.

The trust will issue the following classes of notes:

	Harley-Davidson Motorcycle Contract Backed Notes, Class A-1		Harley-Davidson Motorcycle Contract Backed Notes, Class A-2		Harley-Davidson Motorcycle Contract Backed Notes, Class B		Total
Principal Amount	$		$		$		$

Interest Rate		%		%		%
First Payment Date
Final Scheduled Payment Date
Price to Public		%		%		%	$
Underwriting Discount		%		%		%	$
Proceeds to Issuer		%		%		%	$

Credit Enhancement:

•: Reserve fund with an initial deposit of $ .
•: Subordination of the Class B notes to the Class A notes as described in this prospectus supplement.
•: Excess spread.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these notes or determined if this prospectus supplement or the accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

[UNDERWRITERS]

Prospectus Supplement dated [ ]

Table of Contents

Prospectus Supplement

		Page
Prospectus Supplement Summary		S-1
Risk Factors		S-10
The Trust		S-14
	General	S-14
	Capitalization	S-15
The Seller and Servicer		S-15
The Depositor		S-15
The Trustee and the Indenture Trustee		S-15
The Indenture and the Administration Agreement		S-16
Use of Proceeds		S-16
The Contracts		S-16
	Criteria for Selecting the Contracts	S-16
	Characteristics of the Contracts	S-17
Delinquency, Loan Loss and Repossession Information		S-21
Yield and Prepayment Considerations		S-23
Weighted Average Lives of the Notes		S-23
Description of the Notes		S-26
	General	S-26
	Interest	S-26
	Principal	S-27
	Optional Redemption	S-27
	Mandatory Redemption Following the Funding Period	S-27
	Voting Rights	S-27
	Notices	S-28
Certain Information Regarding the Notes		S-28
	The Accounts	S-28
	Determination of Outstanding Principal Balances	S-30
	Payments and Distributions on the Notes	S-31
Material Federal Income Tax Consequences		S-33
ERISA Considerations		S-34
Legal Proceedings		S-35
Underwriting		S-35
Ratings of the Notes		S-36
Legal Matters		S-37
Experts		S-37
Reports to Noteholders		S-37
Global Clearance, Settlement and Tax Documentation Procedures		S-39
Glossary of Terms		S-43
Report of Independent Registered Public Accounting Firm		S-46
Harley-Davidson Motorcycle Trust [ ] Balance Sheet as of [ ]		S-47
Notes to Balance Sheet		S-47

Reading this prospectus supplement and the accompanying prospectus

We provide information to you about the notes in two separate documents that offer varying levels of detail:

•: prospectus—provides general information, some of which may not apply to the notes; and
•: prospectus supplement—provides specific information relating to the terms of the notes.

References to "we", "our" and "us" refer to Harley-Davidson Customer Funding Corp.

We include cross-references in this prospectus supplement and the accompanying prospectus to captions in these materials where you can find further related discussions. The Table of Contents of this prospectus supplement provides pages on which these captions are located.

You can find a glossary of the principal capitalized terms used in this prospectus supplement beginning on page S-[ ] of this prospectus supplement.

If you have received a copy of this prospectus supplement and the accompanying prospectus in an electronic format, and if the legal prospectus delivery period has not expired, you may obtain a paper copy of this prospectus supplement and the accompanying prospectus from Harley-Davidson Credit Corp. or any of the underwriters by asking any of them for it.

Prospectus Supplement Summary

This summary highlights selected information from this prospectus supplement and does not contain all the information that you should consider in making an investment decision. To understand all of the terms of the offering of the notes, you should read this entire prospectus supplement and the accompanying prospectus before making an investment decision. In addition, you may wish to read the documents governing the transfers and servicing of the contracts, the formation of the trust and the issuance of the notes. Forms of these documents have been filed as exhibits to the registration statement, and final versions of these documents will be filed with the Securities and Exchange Commission following the issuance of the notes.

There are material risks associated with an investment in the notes. See "Risk Factors" in this prospectus supplement and in the accompanying prospectus for a discussion of factors you should consider before investing in the notes.

The Issuer or the Trust		Harley-Davidson Motorcycle Trust [ ], a Delaware statutory trust.
Seller and Servicer		Harley-Davidson Credit Corp., a wholly-owned subsidiary of Harley-Davidson Financial Services, Inc.
Depositor		Harley-Davidson Customer Funding Corp., a wholly-owned, limited-purpose subsidiary of Harley-Davidson Credit Corp.
Trustee		[ ].
Indenture Trustee		[ ]. The indenture trustee will also act as paying agent under the indenture and the trust agreement.
Initial Cutoff Date		[ ].
Closing Date		On or about [ ].
Terms of the Notes		The principal terms of the notes are as described below:

Class	Aggregate Principal Amount
Class A-1 notes	$	%
Class A-2 notes	$	%
Class B notes	$	%

		The notes represent indebtedness of the trust secured by the assets of the trust.
		Each class of notes will be issued in minimum denominations of $1,000 and will be available in book-entry form only.
Payment Dates		The trust will pay interest and principal on the notes on the [ ] day of each month or if that day is not a business day, the next business day. The first payment date is [ ].
Record Dates		The day immediately preceding the payment date.

S-1

Interest		*Interest Periods:*
		Interest on the notes will accrue in the following manner:

From (including)		To (excluding)		Day Count Convention
[ ] day of prior month		[ ] day of current month		30/360

		The first interest period will begin on and include the closing date and end on and exclude [ ].
		*Payment of Interest:*
		On each payment date the trust will pay interest on the notes which will be made from available collections and other amounts.
		Interest payments on the Class A-1 notes and Class A-2 notes will have the same priority. Interest payments on the Class B notes will be subordinated to interest payments on the Class A notes. The trust will make interest payments on the Class B notes after paying interest on the Class A-1 notes and Class A-2 notes.
		See "Certain Information Regarding the Notes—Payments and Distributions on the Notes" and "Description of the Notes—Interest" for a discussion of the determination of the amounts available to pay interest.
Principal		On each payment date, the trust will pay principal on the notes which will be made from available collections and other amounts.
		Principal payments on the Class A notes will be senior in priority to principal payments on the Class B notes. Principal payments on each payment date will generally be allocated [ ]% to the Class A notes and [ ]% to the Class B notes. However, any shortfall in the amount of funds available for principal payments on any payment date will reduce the principal payment on the Class B notes (up to the full amount of the payment) before the principal payment on the Class A notes will be reduced. Principal payments on the Class A-1 notes will be senior in priority to principal payments on the Class A-2 notes. No principal payments will be paid on the Class A-2 notes until the Class A-1 notes have been paid in full.
		See "Certain Information Regarding the Notes—Payments and Distributions on the Notes" and "Description of the Notes—Principal" for a discussion of the determination of amounts available to pay principal.

S-2

Final Scheduled Payment Dates	The principal of the notes of each class is due and payable in full on the final scheduled payment date shown on the cover of this prospectus supplement for such class of notes. If the notes have not already been paid in full prior to their respective final scheduled payment dates, the trust will be obligated to pay the outstanding principal amount of the notes in full on such dates. Certain circumstances could cause principal to be paid earlier or later, or in reduced amounts. See "Description of the Notes—Optional Redemption," "Description of the Notes—Mandatory Redemption Following the Funding Period" in this prospectus supplement and "Description of the Notes and the Indenture—The Indenture—Events of Default; Rights Upon Event of Default" in the prospectus.
Optional Redemption	The servicer has the option to purchase all of the contracts on any payment date on which the aggregate outstanding principal balance of the contracts owned by the trust declines to less than 10% of the sum of:
	•	the aggregate outstanding principal balance of the contracts as of the initial cutoff date; and
	•	the initial amount on deposit in the pre-funding account.
	If the seller exercises this option, the notes will be redeemed at a price equal to the unpaid principal amount thereof plus accrued interest thereon. See "Description of the Notes—Optional Redemption."
Mandatory Redemption	The notes will be prepaid in part, without premium, on the payment date on or immediately following the last day of the pre-funding period (generally the ninety-day period following the closing date) in the event that any amount remains on deposit in the pre-funding account. The aggregate principal amount of notes to be prepaid will be an amount equal to the amount then on deposit in the pre- funding account allocated pro rata among the notes; provided that if the amount remaining on deposit in the pre-funding account is less than $150,000, such amount will be allocated solely to the Class A-1 notes. See "Description of the Notes—Mandatory Redemption Following the Funding Period."

S-3

The Contracts and Other Assets of the Trust		The property of the trust will be a pool of fixed-rate, simple interest conditional sales contracts and promissory note and security agreements relating to motorcycles manufactured by one or more subsidiaries of Harley-Davidson, Inc., (including Buell Motorcycle Company, LLC, a wholly-owned subsidiary of Harley-Davidson, Inc.) or certain other manufacturers. See "Other Manufacturers" in the prospectus. The contracts were or will be originated indirectly by the seller primarily through Eaglemark Savings Bank, a wholly-owned subsidiary of Harley-Davidson Credit Corp. and, to a limited extent, through Harley-Davidson motorcycle dealers. Included in the trust's assets are security interests in the Harley-Davidson, Buell and other motorcycles securing the contracts and proceeds, if any, from certain insurance policies and debt cancellation agreements with respect to such motorcycles.
The Contracts		The trust's main source of funds for making payments on the notes will be collections on the contracts. The contracts (including any subsequent contracts) transferred to the trust will be selected from contracts in the seller's portfolio based on the criteria specified in the transfer and sale agreement. Obligors on the contracts are located in the 50 states of the United States, the District of Columbia, the U.S. Territories and military bases.
		On the closing date, pursuant to the sale and servicing agreement, the depositor will transfer, and the trust will acquire, initial contracts with the characteristics set forth below as of the close of business on the initial cutoff date.
		Following the closing date, pursuant to the sale and servicing agreement, the depositor will be obligated, subject only to the availability of additional contracts, to transfer, and the trust will be obligated to acquire, subject to the satisfaction of certain conditions set forth in the sale and servicing agreement, subsequent contracts. Following the transfer of subsequent contracts to the trust, the aggregate characteristics of the entire pool of contracts may vary from the characteristics of the initial contracts set forth below.
		The last scheduled payment on the initial contract with the latest maturity will occur in [ ].
		No contract (including any subsequent contract sold to the trust after the closing date) will have a scheduled maturity later than [ ]. However, an obligor can generally prepay its contract at any time without penalty.

S-4

COMPOSITION OF THE INITIAL CONTRACTS (AS OF THE INITIAL CUTOFF DATE)

Aggregate Principal Balance		$[ ]
Number of Contracts		[ ]
Average Principal Balance		$[ ]
Weighted Average Contract Interest Rate		[ ]	%
	(Range)	[ ]	%
Weighted Average Original Term (in months)		[ ]
	(Range)	[ ] to [ ]
Weighted Average Remaining Term (in months)		[ ]
	(Range)	[ ] to [ ]

GEOGRAPHIC CONCENTRATION (AS OF THE INITIAL CUTOFF DATE)
State		Principal Balance Concentration
[ ]		[ ]%
[ ]		[ ]%
[ ]		[ ]%

		No other state represented more than [ ]% of the aggregate principal balance of the contracts as of the initial cutoff date.
Reserve Fund		On the closing date, the depositor will establish a trust account in the name of the indenture trustee which we refer to as the "reserve fund." The reserve fund provides you with limited protection in the event collections from obligors on the contracts are insufficient to make payments on the notes. We cannot assure you, however, that this protection will be adequate to prevent shortfalls in amounts available to make payments on the notes.
		The initial balance of the reserve fund will be $[ ] ([ ]% of the aggregate principal balance of the contracts as of the initial cutoff date). On any date on which subsequent contracts are transferred to the trust, an additional amount equal to [ ]% of the aggregate principal balance of those subsequent contracts will be deposited into the reserve fund. The amount required to be on deposit in the reserve fund on each payment date will equal the greater of (a) [ ]% of the aggregate principal balance of the contracts in the trust as of the last day of the immediately preceding calendar month ([ ]% in the event a reserve fund trigger event has occurred and is continuing) and (b) [ ]% of the aggregate principal amount of the notes as of the closing date. In no event shall the amount required to be on deposit in the reserve fund exceed the aggregate outstanding principal balance of the notes. See "Certain Information Regarding the Notes—Calculation of Reserve Fund Required Amount."

S-5

		If the amount on deposit in the reserve fund on any payment date is less than the required amount, the trust will use the funds available to it after payment of the servicing fee and the fee payable to the indenture trustee, reimbursement of servicer advances and payment of interest and principal on the notes to make a deposit into the reserve fund. Amounts on deposit in the reserve fund on any payment date in excess of the required amount will be paid to the depositor.
		If on any payment date the funds available to the trust to pay principal and interest on the notes are insufficient to make payments on the notes, the trust will use funds in the reserve fund to cover any shortfalls.
		If on the final scheduled payment date of any class of notes, the principal balance of that class has not been paid in full, the trust will use funds in the reserve fund to pay those notes [in full].
Pre-Funding Period and Pre-Funding Account		The pre-funding period generally will be the ninety-day period immediately following the closing date.
		On the closing date, the depositor will fund an account called the pre-funding account by depositing $[ ] ( [ ]% of the aggregate principal amount of the notes as of the closing date) which will secure the depositor's obligation to purchase subsequent contracts from the seller and transfer those contracts to the trust. The amount in the pre-funding account will be reduced by the amount used to purchase subsequent contracts from the seller. The depositor expects that the amount in the pre-funding account will be reduced to less than $150,000 by the payment date occurring in [ ]. Any amount remaining in the pre-funding account at the end of the pre-funding period will be paid to the noteholders as described in "Description of the Notes—Mandatory Redemption Following the Funding Period."
Interest Reserve Account		On the closing date, the depositor will fund an account called the interest reserve account by depositing $[ ] which account will provide additional funds to cover shortfalls in the monthly investment earnings on amounts in the pre-funding account (until such amounts have been used to acquire subsequent contracts) which earnings are expected to be less than the weighted average of the interest payments on the notes and to pay the indenture trustee's fee. In addition to the initial deposit, all investment earnings with respect to the pre-funding account will be deposited into the interest reserve account.
		The interest reserve account is not intended to provide any protection against losses on the contracts in the trust. After the funding period, funds remaining in the interest reserve account will be paid to the depositor.

S-6

Ratings

On the closing date, the notes must have received ratings from Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. and Moody's Investors Service, Inc. as set forth below:

		Standard & Poor's		Moody's
Class A-1
Class A-2
Class B

		A rating is not a recommendation to buy, sell or hold securities. There can be no assurance that the ratings will not be lowered or withdrawn at any time by either of the rating agencies. See "Ratings of the Notes."
Servicer Advances		The servicer is obligated to advance each month an amount equal to accrued and unpaid interest on each contract that is 30 days or greater delinquent with respect to the related due period, but only to the extent that the servicer believes that the amount of such advance will be recoverable from collections on such contract. The servicer will be entitled to reimbursement of its outstanding advances on any payment date by means of a first priority withdrawal of certain funds then held in the collection account. See "Description of the Transfer and Servicing Agreements—Servicing—Advances" in the prospectus.
Mandatory Repurchase by the Depositor		Under the sale and servicing agreement, we have agreed, in the event of a breach of certain representations and warranties made by us which materially and adversely affects the trust's interest in any contract and which has not been cured, to repurchase such contract two business days prior to the first payment date after the last day of the calendar month in which the servicer, the trustee, the indenture trustee or we become aware of such breach. See "Description of the Transfer and Servicing Agreements—Representations and Warranties Made by the Seller and the Depositor" in the prospectus.
Servicing Fees		The servicer will be entitled to receive a monthly servicing fee equal to 1/12th of [ ]% of the aggregate principal balance of the contracts as of the first day of the prior calendar month (or with respect to the first payment date, the aggregate principal balance of the contracts as of the initial cutoff date). The servicer will also be entitled to receive any extension fees or late payment penalty fees paid by obligors. The servicing fees will be paid to the servicer from funds in the collection account prior to any payments to the noteholders. See "Certain Information Regarding the Notes—Payments and Distributions on the Notes—Servicing Compensation and Reimbursement of Servicer Advances."

S-7

Priority of Payments	*Prior to Acceleration of the Notes:*
	On each payment date prior to the acceleration of the notes, the trust will apply collections on the contracts received during the prior calendar month, servicer advances and, with respect to payments of principal and interest on the notes, funds transferred from the reserve fund to make the following payments in the following order of priority:
	•	to the noteholders, the amount of any mandatory redemption in the manner described in "Description of the Notes—Mandatory Redemption Following the Funding Period";
	•	reimbursement of servicer advances;
	•	servicing fee;
	•	indenture trustee's fee;
	•	interest on the Class A notes, pro rata;
	•	interest on the Class B notes;
	•	principal on the Class A notes and the Class B notes, in the priority set forth in "Principal" above;
	•	to the reserve fund, the amount, if any, needed to fund the reserve fund to the required amount; and
	•	any remaining amounts to the depositor as certificateholder under the trust agreement.
	*After Acceleration of the Notes:*
	After an event of default due to a breach of a material covenant or agreement by the trust and acceleration of the notes, all amounts available to the noteholders will be made in the following priority:
	•	interest on the Class A notes, pro rata;
	•	interest on the Class B notes;
	•	principal on the Class A notes, pro rata, until paid in full; and
	•	principal on the Class B notes, until paid in full.
	After an event of default due to a payment default or certain insolvency events and acceleration of the notes, all distributions available to the noteholders will be made in the following priority:
	•	interest on the Class A notes, pro rata;
	•	principal on the Class A notes, pro rata, until paid in full;
	•	interest on the Class B notes; and
	•	principal on the Class B notes, until paid in full.
Credit Enhancement	Credit enhancement provides protection for the Class A notes and Class B Notes against losses and delays in payment.

S-8

The credit enhancement for the notes is as follows:

Class A notes:	•	subordination of the Class B notes
	•	reserve fund
	•	excess spread
Class B notes:	•	reserve fund
	•	excess spread

Material Federal Income Tax Consequences		Winston & Strawn LLP, as federal tax counsel to the trust, will deliver its opinion that the notes will be characterized as debt for federal income tax purposes, and the trust will not be characterized as an association (or publicly traded partnership) taxable as a corporation. The purpose of obtaining the opinion of tax counsel is to provide investors with greater assurance that the notes will be characterized as debt for federal income tax purposes and that the trust will not be subject to federal income tax at the entity level. However, an opinion of tax counsel is not binding on the Internal Revenue Service and there is no assurance that the Internal Revenue Service will not disagree with the opinion of federal tax counsel. By purchasing a note, you agree to treat your note as debt for federal, state and local income tax purposes. Payments received by you will generally be treated as either interest or principal and you will not be considered an owner of an equity interest in the trust.
		The foregoing is a very general summary of material federal income tax matters. These general statements are subject to the qualifications, clarifications, assumptions and expanded discussion set forth in the accompanying prospectus and in this prospectus supplement under the heading "Material Federal Income Tax Consequences."
ERISA Considerations		The notes are generally eligible for purchase by employee benefit plans and individual retirement accounts and similar arrangements, and by persons investing on behalf of or with plan assets of such plans, accounts and arrangements, subject to those considerations and exceptions discussed under "ERISA Considerations" in the accompanying prospectus and in this prospectus supplement.
		You should refer to "ERISA Considerations" in the accompanying prospectus and in this prospectus supplement. If you are a benefit plan fiduciary considering a purchase of the notes you should, among other things, consult with your counsel in determining whether all required conditions have been satisfied.
Marketing Address and Telephone Numbers of Principal Executive Offices		The mailing address of the seller is 150 South Wacker Drive, Suite 3100, Chicago, Illinois 60606, telephone (312) 368-9501. The mailing address of the depositor is 3850 Arrowhead Drive, Carson City, Nevada 89706, telephone (775) 886-3000. The principal office of the trust is in care of [ ].

S-9

Risk Factors

The following risk factors and the risk factors in the accompanying prospectus describe the principal risk factors relating to an investment in the notes.

You should carefully consider the following risks before you invest in the notes. You should also carefully consider the risk factors beginning on page [ ] of the accompanying prospectus.

Some classes of notes will be entitled to interest or principal payments before other classes

The trust will pay interest, principal or both on some classes of notes prior to paying interest, principal or both on other classes of notes. The subordination of some classes to others means that the subordinated classes are more likely to suffer the consequences of delinquent payments and defaults on the contracts than the classes having prior payment rights. See "Certain Information Regarding the Notes—Payments and Distributions on the Notes" in this prospectus supplement.

Moreover, the more senior classes of notes could lose the credit enhancement provided by the more subordinate classes and the reserve fund if delinquencies and defaults on contracts increase and the collections on contracts and amounts in the reserve fund are insufficient to pay the more senior classes of notes.

Adverse events in [ ] high concentration states may cause increased defaults and delinquencies

If adverse events or economic conditions were particularly severe in a geographic region where there is a substantial concentration of obligors, the amount of delinquent payments and defaults on the contracts may increase. As a result, the overall timing and amount of collections on the contracts may differ from what you expect, and you may experience delays or reductions in payments.

The following are the approximate percentages of the aggregate principal balance of the contracts as of the initial cutoff date whose obligors are located in the following states:

•: [ ]% in [ ],
•: [ ]% in [ ], and
•: [ ]% in [ ].

The remaining states accounted for [ ]% of the aggregate principal balance of the contracts as of the initial cutoff date, and none of these remaining states accounted for more than [ ]% of the aggregate principal balance of the contracts as of the initial cutoff date. For a discussion of the breakdown of the contracts by state, see "The Contracts" in this prospectus supplement.

Although we do not know of any matters likely to increase the rate of delinquencies or defaults in these states, adverse events specific to a geographic region would include natural disasters and regional economic downturns. For example, a substantial downturn in the financial services industry, which is highly concentrated in the states of New York and New Jersey, or in the oil and gas industry, which is concentrated in the state of Texas could reduce the income of obligors in those states and ultimately reduce the related obligors' ability to make timely payments on their contracts. In addition, the following economic conditions may affect payments:

•: unemployment,
•: interest rates,
•: inflation rates, and
•: consumer perceptions of the economy.

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Future delinquency and loss experience of the contracts may vary substantially from the servicer's historical experience

Presented in this prospectus supplement is the historical delinquency and loss experience of the portfolio of contracts originated indirectly or purchased by the seller and serviced by the servicer consisting primarily of contracts secured by motorcycles sold in the United States (including U.S. Territories) manufactured by Harley-Davidson, Buell and other manufacturers. However, the actual delinquency and loss experience for the contracts transferred to a trust could be substantially worse. If so, you may not receive interest and principal payments on your securities in the amounts and at the times you expect.

The notes may not be suitable investments for all investors

The notes may not be a suitable investment for any investor that requires a regular or predictable schedule of principal payments. We suggest that only investors who, either alone or with their financial, tax and legal advisors, have the expertise to analyze the prepayment, reinvestment and default risks, the tax consequences of an investment and the interaction of these factors consider purchasing the notes.

Prepayments, potential losses and change in the order of priority of payments may occur following acceleration of the notes

If the maturity dates of the notes are accelerated following an event of default resulting from a payment default or the insolvency of the trust, the trust will make no further distributions of interest in respect of the subordinated classes of notes until the more senior classes of notes are paid in full.

If the maturity dates of the notes are accelerated following an event of default due to certain insolvency events, the indenture trustee under certain circumstances may sell the trust assets. In such event, the trust may not have sufficient funds to pay all of the notes in full.

In addition, if the maturity dates of the notes are accelerated following an event of default due to a payment default and the indenture trustee determines that the trust assets will not be sufficient on an ongoing basis to make all payments on the notes as the payments would have become due if the maturity dates of the notes had not been accelerated, the indenture trustee with the consent of the holders of all outstanding notes may sell the trust assets for an amount less than the aggregate outstanding principal amount of the notes. In such event, the trust may not have sufficient funds to pay all of the notes in full.

If you receive your principal earlier than expected, you may not be able to reinvest the prepaid amount at a rate of return that is equal to or greater than the rate of return on your notes. If the trust is required to sell its assets in the circumstances described above, the amount received from the sale may not be sufficient to pay all amounts owed to you.

Because the notes are in book-entry form, your rights can only be exercised indirectly

Because the notes will be issued in book-entry form, you will be required to hold your interest in the notes through The Depository Trust Company in the United States, or Clearstream, Luxembourg, or the Euroclear System in Europe. Transfers of interests in the notes must therefore be made in accordance with the usual rules and operating procedures of those systems. So long as the notes are in book-entry form, you will not be entitled to receive a physical note representing your interest. The notes will remain in book-entry form except in the limited circumstances described under the caption "Information Regarding the Securities—Book-Entry Registration" in the accompanying prospectus. Unless and until the notes in this prospectus supplement cease to be held in book-entry form, the indenture trustee will not recognize you as a "noteholder," as such term is used in the indenture. As a result, you will only be able to exercise the rights of noteholders indirectly through DTC, if in the United States,

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and its participating organizations, or Clearstream and Euroclear, in Europe, and their participating organizations. Holding the notes in book-entry form could also limit your ability to pledge your notes to persons or entities that do not participate in DTC, Clearstream or Euroclear and to take other actions that require a physical note.

Interest and principal on the notes will be paid by the trust to DTC as the holder of record of the notes while they are held in book-entry form. DTC will credit payments received from the trust to the accounts of its participants which, in turn, will credit those amounts to noteholders either directly or indirectly through indirect participants. This process may delay your receipt of principal and interest payments from the trust.

The holders of the Class B notes will have limited control with respect to certain trust actions which could conflict with the interests of the holders of the Class A notes

Because the trust has pledged the property of the trust to the indenture trustee to secure payment on the notes, the indenture trustee, acting at the direction of the holders of a specified percentage of the outstanding principal amount of the Class A notes, has the power to direct the trust to take certain actions in connection with the property of the trust until the Class A notes have been paid in full. Furthermore, the holders of a majority of the Class A notes, or the indenture trustee acting on behalf of the holders of Class A notes, under certain circumstances, has the right to terminate the servicer as the servicer of the contracts without consideration of the effect such termination would have on the holders of Class B notes. The holders of the Class B notes will not have the ability to remove the servicer until the Class A notes have been paid in full. In addition, the holders of not less than a majority in outstanding principal amount of the Class A notes will have the right to waive certain events of default with respect to the servicer, without consideration of the effect such waiver would have on the holders of Class B notes. See "Description of the Transfer and Servicing Agreements—Servicing—Servicer Default" and "—Rights Upon Servicer Default" in the prospectus and "Description of the Notes—Voting Rights" in this prospectus supplement.

Characteristics of the pool of contracts may change due to pre-funding

There will be no required characteristics of the contracts transferred to the trust during the pre-funding period, except for the criteria described in "The Contracts" in this prospectus supplement. Additional contracts may be originated at a later date using credit criteria different from those that were applied to the initial contacts and may be of a different credit quality and seasoning. In addition, following the transfer of subsequent contracts to the trust, the characteristics of the entire pool of contracts, including the composition of the contracts, the distribution by contract rate, payment frequency, average maturity, current contract value and geographic distribution, may vary from those of the initial contracts. Since the weighted average life of the notes will be influenced by the rate at which the principal balances of the contracts are paid, some of these variations will affect the weighted average life of the notes. However, the requirements set forth in "The Contracts" in this prospectus supplement are intended to minimize the effect of the addition of subsequent contracts on increasing the weighted average life of the notes.

Prepayments of principal on the notes could result from pre-funding

If the principal amount of eligible contracts purchased or originated by the seller indirectly through Harley-Davidson or Buell motorcycle dealers or Eaglemark Savings Bank during the trust's pre-funding period, plus other pre-existing eligible contracts, is less than the amount deposited in the trust's pre-funding account, we will not have sufficient contracts to sell to the trust during the pre-funding period. This would result in a prepayment of principal in an aggregate amount equal to the amount remaining in the pre-funding account at the end of the pre-funding period allocated to the notes pro rata unless the amount remaining on deposit is less than $150,000. See "Description of the

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Notes—Mandatory Redemption Following the Funding Period" in this prospectus supplement. Any prepayment will shorten the weighted average life of the affected notes. The amount of the notes that will be prepaid is not known at this time, but the greater the prepayment, the shorter the weighted average life of the notes.

United States and world economic and political conditions, including acts or threats of terrorism and/or war, could adversely affect payments on the notes

National and international political developments, instability and uncertainties could result in economic weakness in the United States and in international markets. These uncertainties include threatened hostilities with other countries, political unrest and instability around the world, and continuing threats of terrorist attacks. Any actual armed hostilities, and any future terrorist attacks in the United States or abroad, could also have an adverse impact on the U.S. economy, global financial markets and payments and collections on the contracts.

You should consider the possible effects on delinquency, default and prepayment experience of the contracts. For example, the ongoing U.S. military operations in the Middle East and hostilities in other countries have increased the number of citizens who are in active military service, including persons in reserve status who have been called or will be called to active duty. Under the Servicemembers Civil Relief Act, obligors who are members of the military on active duty, including reservists who are called to active duty after the origination of their contracts, may be entitled to reductions in interest rates to 6% and a stay of foreclosure and similar actions. No information can be provided as to the number of contracts that may be affected by the Servicemembers Civil Relief Act. If an obligor's obligation to make payments is reduced, adjusted or extended, the servicer will only be required to advance principal and interest which was 30 days or more delinquent with respect to the related due period, and only to the extent the servicer believes that such amounts will ultimately be recoverable through collection. Any resulting shortfalls in interest or principal will reduce the amount available for distribution on the notes.

The Servicemembers Civil Relief Act also limits the ability of the servicer to repossess the financed motorcycle securing a contract during the related obligor's period of active duty and, in some cases, may require the servicer to extend the maturity of the contract, lower the monthly payments and readjust the payment schedule for a period of time after completion of the obligor's military service. As a result, there may be delays in payment and increased losses on the contracts.

For more information regarding the effect of the Servicemembers Civil Relief Act, you should refer to "Legal Aspects of the Contracts—Other Limitations" in the prospectus.

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The Trust

General

Harley-Davidson Motorcycle Trust [ ] is a statutory trust formed under the laws of the State of Delaware pursuant to the trust agreement between the depositor and the trustee for the transactions described herein. After its formation, the trust will engage in only a limited set of activities. The trust's activities are limited to:

•: acquiring, holding and managing the contracts and the other assets of the trust and proceeds therefrom;
•: issuing the notes and the certificate;
•: making payments on the notes and the certificate; and
•: engaging in other activities that are necessary, suitable or convenient to accomplish the foregoing purposes or that are incidental to or connected with the foregoing purposes.

Under a transfer and sale agreement between the seller and the depositor, the seller will sell all of the contracts and the related property to the depositor.

Under a sale and servicing agreement among the trust, the depositor, the servicer and the indenture trustee, the depositor will transfer all of the contracts and related property to the trust.

The property of the trust will consist of:

•: the contracts and the right to receive all scheduled payments and prepayments received on the contracts after the applicable cutoff date, but excluding any scheduled payments due after, but received on or prior to, the applicable cutoff date;
•: security interests in the financed motorcycles securing the contracts and any related property;
•: rights with respect to any repossessed financed motorcycles;
•: the rights to proceeds from claims on theft, physical damage, credit life and disability insurance policies and debt cancellation agreements covering the financed motorcycles or the obligors;
•: certain rebates of premiums and other amounts relating to insurance policies, extended service contracts or other repair agreements and other items financed under the contracts;
•: the depositor's rights against the seller under the transfer and sale agreement pursuant to which the seller sold the contracts to the depositor;
•: the right to receive payments from the depositor for the repurchase of contracts which do not meet specified representations and warranties made by the depositor in the sale and servicing agreement;
•: the trust's rights against the servicer under the sale and servicing agreement;
•: amounts held in the collection account, the note distribution account, the pre-funding account, the interest reserve account and the reserve fund to be established and maintained under the sale and servicing agreement; and
•: all proceeds of the foregoing.

The trust will issue a certificate to the depositor representing the entire beneficial ownership interest in the trust. The certificate will at all times be owned by the depositor or other single person. The fiscal year end of the trust is December 31.

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The trust's principal offices will be in [ ], in care of [ ], as trustee, at the address listed below under "The Trustee and the Indenture Trustee."

Capitalization

In addition to the notes, the trust will issue a certificate having no principal balance. The holder of the certificate will be entitled to receive certain distributions of excess cash flow and releases from the reserve fund from time to time as set forth under "Certain Information Regarding the Notes—Payments and Distributions on the Notes." Initially, the certificate will be retained by the depositor.

On or prior to the closing date, the depositor will make an equity contribution to the trust in the amount of $1,000. The following table illustrates the capitalization of the trust as of the closing date:

Class A-1 notes		$	[ ]
Class A-2 notes		$	[ ]
Class B notes		$	[ ]
Certificate		$	0
Cash		$	1,000

	Total	$	[ ]

The Seller and Servicer

Harley-Davidson Credit Corp. will act as seller and servicer of the contracts and will receive compensation and certain other fees for such services. Information regarding the seller and the servicer is set forth under the caption "The Seller and Servicer" in the accompanying prospectus.

The Depositor

Harley-Davidson Customer Funding Corp. will act as depositor. Information regarding the depositor is set forth under the caption "The Depositor" in the accompanying prospectus.

The Trustee and the Indenture Trustee

[ ] will be the trustee under the trust agreement. The trustee is a [ ] and its principal offices are located at [ ].

[ ] will be the indenture trustee under the indenture. The indenture trustee is a [ ] and its principal offices are located at [ ].

The servicer will separately pay the fees of the trustee in connection with its duties under the trust agreement. The indenture trustee's fees will be paid by the trust from Available Amounts prior to any payments to the noteholders. Each of the trustee and the indenture trustee will also be entitled to indemnification by the depositor for, and will be held harmless against, any loss, liability, fee, disbursement or expense incurred by it not resulting from its own willful misfeasance, bad faith or negligence. The depositor will also indemnify the trustee and the indenture trustee for specified taxes that may be asserted in connection with the transaction.

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The Indenture and the Administration Agreement

Under an indenture between the trust and the indenture trustee, the trust will pledge the trust assets to the indenture trustee to secure the payment of the notes.

Under an administration agreement among the trust, the indenture trustee, the depositor and Harley-Davidson Credit Corp., as administrator, the administrator will agree to perform certain of the trust's administrative functions under the indenture and certain of the trustee's administrative functions under the trust agreement.

Use of Proceeds

The depositor will use the net proceeds received from the sale of the notes (i) for the purchase of the initial contracts and related assets from the seller and (ii) the remainder for the funding of the pre-funding account. The seller will use the net proceeds from the depositor's purchase of the initial contracts, as well as subsequent contracts, to fund a new portfolio of conditional sales contracts and promissory note and security agreements.

The Contracts

The trust will own a pool of conditional sales contracts and promissory note and security agreements secured by new and used motorcycles.

Criteria for Selecting the Contracts

The contracts have been (or will be, in the case of subsequent contracts) selected by the seller from the seller's portfolio of contracts using several criteria, some of which are set forth in the prospectus under "The Contracts—Criteria for Selecting the Contracts.". The contracts were originated indirectly by the seller primarily through Eaglemark Savings Bank and, to a limited extent, through Harley-Davidson motorcycle dealers and acquired by the depositor in the ordinary course of the depositor's business. In addition, the selection criteria include the requirement that each contract:

•: is a fixed-rate simple interest conditional sales contract or promissory note and security agreement;
•: is secured by a new or used motorcycle manufactured by one or more subsidiaries of Harley-Davidson, Inc. (including Buell Motorcycle Company, LLC) or certain other motorcycle manufacturers;
•: has a contract interest rate of not less than [ ]%;
•: will amortize the amount financed over an original term no greater than [ ] months;
•: is not more than [ ] days delinquent, as determined by the servicer in accordance with its policies and procedures, as of the applicable cutoff date; and
•: has a current principal balance of at least $[ ].

The contracts were selected from the seller's portfolio of conditional sales contracts and promissory note and security agreements for new and used motorcycles, in each case meeting the criteria described above. No selection procedures believed to be adverse to the securityholders were utilized in selecting the contracts from qualifying conditional sales contracts and promissory note and security agreements.

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Characteristics of the Contracts

The contracts have or will have the following characteristics:

•: the last scheduled payment of each initial contract is due no later than [ ], and with respect to the contracts as a whole (including any subsequent contracts conveyed to the trust after the closing date), the last scheduled payment will be due no later than [ ];
•: the first scheduled payment date of contracts representing approximately [ ]% of the aggregate principal balance of the initial contracts as of the initial cutoff date is due no later than [ ] and the first scheduled payment date of remaining contracts representing approximately [ ]% of the aggregate principal balance of the initial contracts as of the initial cutoff date is due no later than [ ];
•: approximately [ ]% of the principal balance of the initial contracts as of the initial cutoff date is attributable to loans to purchase motorcycles which were new and approximately [ ]% is attributable to loans to purchase motorcycles which were used at the time the related contract was originated;
•: approximately [ ]% of the principal balance of the initial contracts as of the initial cutoff date is attributable to loans to purchase motorcycles manufactured by Harley-Davidson or Buell and approximately [ ]% of the principal balance of the initial contracts as of the initial cutoff date is attributable to loans to purchase motorcycles not manufactured by Harley-Davidson or Buell;
•: all initial contracts have a contract interest rate of at least [ ]% per annum and not more than [ ]% per annum and the weighted average contract interest rate of the initial contracts as of the initial cutoff date is approximately [ ]% per annum (see Table 1 below);
•: the initial contracts have remaining maturities as of the initial cutoff date of at least [ ] months but not more than [ ] months and original maturities of at least [ ] months but not more than [ ] months;
•: the initial contracts have a weighted average term to scheduled maturity as of the initial cutoff date of approximately [ ] months, and a weighted average term to scheduled maturity as of origination of approximately [ ] months (see Tables 2 and 3 below);
•: the average principal balance per initial contract as of the initial cutoff date was approximately $[ ] and the principal balances on the initial contracts as of the initial cutoff date ranged from $[ ] to $[ ] (see Table 4 below);
•: the contracts arise (or will arise) from loans to obligors located in 50 states, the District of Columbia, the U.S. Territories[, Canada] and military bases and with respect to the initial contracts, constitute the following approximate amounts expressed as a percentage of the aggregate principal balance of the initial contracts as of the initial cutoff date: [ ]% in [ ], [ ] % in [ ] and [ ]% in [ ] (see Table 5 below). No other geographic location represented more than [ ]% of the aggregate principal balance of the initial contracts.

Except for certain criteria specified in the preceding paragraph, there will be no required characteristics of the subsequent contracts. Therefore, following the transfer of the subsequent contracts to the trust, the aggregate characteristics of the entire pool of the contracts, including the composition of the contracts, the distribution by contract interest rate of the contracts, the distribution by remaining term of the contracts, the distribution by original term to maturity of the contracts, the distribution by current balance of the contracts, and the geographic distribution of the contracts, described in the following tables, may vary from those of the initial contracts as of the initial cutoff date.

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TABLE 1

DISTRIBUTION BY CONTRACT INTEREST RATE OF THE INITIAL CONTRACTS
(AS OF THE INITIAL CUTOFF DATE)

RATE			NUMBER OF CONTRACTS		PERCENT OF NUMBER OF CONTRACTS(1)		TOTAL OUTSTANDING BALANCE PRINCIPAL		PERCENT OF POOL BALANCE(1)
	TOTALS:				100.00	%			100.00	%

(1): Percentages may not add to 100.00% because of rounding.

TABLE 2

DISTRIBUTION BY REMAINING TERM TO MATURITY
OF THE INITIAL CONTRACTS
(AS OF THE INITIAL CUTOFF DATE)

CALCULATED REMAINING TERM (MONTHS)			NUMBER OF CONTRACTS		PERCENT OF NUMBER OF CONTRACTS(1)		TOTAL OUTSTANDING BALANCE PRINCIPAL		PERCENT OF POOL BALANCE(1)
	TOTALS:				100.00	%			100.00	%

TABLE 3

DISTRIBUTION BY ORIGINAL
TERM TO MATURITY OF THE INITIAL CONTRACTS
(AS OF THE INITIAL CUTOFF DATE)

ORIGINAL TERM (MONTHS)			NUMBER OF CONTRACTS		PERCENT OF NUMBER OF CONTRACTS(1)		TOTAL OUTSTANDING PRINCIPAL BALANCE		PERCENT OF POOL BALANCE(1)
	TOTALS:				100.00	%			100.00	%

(1): Percentages may not add to 100.00% because of rounding.

TABLE 4

DISTRIBUTION BY CURRENT BALANCE OF THE INITIAL CONTRACTS
(AS OF THE INITIAL CUTOFF DATE)

CURRENT BALANCE			NUMBER OF CONTRACTS		PERCENT OF NUMBER OF CONTRACTS(1)		TOTAL OUTSTANDING PRINCIPAL BALANCE		PERCENT OF POOL BALANCE(1)
	TOTALS:				100.00	%			100.00	%

(1): Percentages may not add to 100.00% because of rounding.

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TABLE 5

GEOGRAPHIC DISTRIBUTION OF THE INITIAL CONTRACTS
(AS OF THE INITIAL CUTOFF DATE)

STATE(1)		NUMBER OF CONTRACTS		PERCENT OF NUMBER OF CONTRACTS(2)		TOTAL OUTSTANDING PRINCIPAL BALANCE		PERCENT OF POOL BALANCE(2)
ALABAMA
ALASKA
ARIZONA
ARKANSAS
CALIFORNIA
COLORADO
CONNECTICUT
DELAWARE
DISTRICT OF COLUMBIA
FLORIDA
GEORGIA
HAWAII
IDAHO
ILLINOIS
INDIANA
IOWA
KANSAS
KENTUCKY
LOUISIANA
MAINE
MARYLAND
MASSACHUSETTS
MICHIGAN
MINNESOTA
MISSISSIPPI
MISSOURI
MONTANA
NEBRASKA
NEVADA
NEW HAMPSHIRE
NEW JERSEY
NEW MEXICO
NEW YORK
NORTH CAROLINA
NORTH DAKOTA
OHIO
OKLAHOMA
OREGON
PENNSYLVANIA

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TABLE 5

GEOGRAPHIC DISTRIBUTION OF THE INITIAL CONTRACTS
(CONTINUED)

STATE(1)		PERCENT OF NUMBER OF CONTRACTS(2)		PERCENT OF POOL BALANCE(2)
RHODE ISLAND
SOUTH CAROLINA
SOUTH DAKOTA
TENNESSEE
TEXAS
UTAH
VERMONT
VIRGINIA
WASHINGTON
WEST VIRGINIA
WISCONSIN
WYOMING
OTHER(3)
	TOTALS:	100.00	%	100.00	%

(1): Based on billing addresses of obligors as of the initial cutoff date.
(2): Percentages may not add to 100.00% because of rounding.
(3): Includes U.S. Territories [, Canada]and military bases.

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Delinquency, Loan Loss and Repossession Information

The following tables set forth the delinquency experience and loan loss and repossession experience of the seller's portfolio of contracts consisting primarily of contracts secured by motorcycles sold in the United States (including U.S. Territories) manufactured by Harley-Davidson, Buell and other manufacturers. These figures include data in respect of contracts which the seller has previously sold with respect to prior securitizations and for which the seller acts as servicer.

		Delinquency Experience At December 31,
		2004				2003				2002				2001				2000
		Number of Contracts		Amount		Number of Contracts		Amount		Number of Contracts		Amount		Number of Contracts		Amount		Number of Contracts		Amount
		(Dollars in Thousands)
Portfolio		[	]	$[	]	[	]	$[	]	[	]	$[	]	[	]	$[	]	[	]	$[	]
Period of Delinquency
	30-59 Days	[	]	$[	]	[	]	$[	]	[	]	$[	]	[	]	$[	]	[	]	$[	]
	60-89 Days	[	]	[	]	[	]	[	]	[	]	[	]	[	]	[	]	[	]	[	]
	90 Days or more	[	]	[	]	[	]	[	]	[	]	[	]	[	]	[	]	[	]	[	]
Total Delinquencies		[	]	$[	]	[	]	$[	]	[	]	$[	]	[	]	$[	]	[	]	$[	]
Total Delinquencies as a Percent of Total Portfolio		[	]%	[	]%	[	]%	[	]%	[	]%	[	]%	[	]%	[	]%	[	]%	[	]%

		[At March 31,][At June 30,][At September 30,]
		2005				2004
		Number of Contracts		Amount		Number of Contracts		Amount
Portfolio		[	]	$[	]	[	]	$[	]
Period of Delinquency
	30-59 Days	[	]	$[	]	[	]	$[	]
	60-89 Days	[	]	[	]	[	]	[	]
	90 Days or more	[	]	[	]	[	]	[	]
Total Delinquencies		[	]	$[	]	[	]	$[	]
Total Delinquencies as a Percent of Total Portfolio		[	]%	[	]%	[	]%	[	]%

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Loan Loss/Repossession Experience
(Dollars in Thousands)

		Year Ended December 31,
		2004		2003		2002		2001		2000
Outstanding Balance of All Contracts Serviced		$[	]	$[	]	$[	]	$[	]	$[	]
Contract Liquidations		[	]%	[	]%	[	]%	[	]%	[	]%
Net Losses:
	Dollars	$[	]	$[	]	$[	]	$[	]	$[	]
	Percentage	[	]%	[	]%	[	]%	[	]%	[	]%

		[Three][Six][Nine] Months Ended [March 31,] [June 30,] [September 30,]
		2005		2004
Outstanding Balance of All Contracts Serviced		$[	]	$[	]
Contract Liquidations		[	]%	[	]%
Net Losses:
	Dollars	$[	]	$[	]
	Percentage	[	]%	[	]%

The data presented in the foregoing tables are for illustrative purposes only and there is no assurance that the delinquency, loan loss or repossession experience of the contracts included in the trust will be similar to that set forth above.

Changes in the net loss and delinquency experience of the portfolio have generally been driven by the growth and seasoning of the portfolio, improvements in collection procedures and fluctuations in the general economic environment.

In particular, by [ ], delinquencies, as a percentage of the total portfolio, [ ] from [ ], resulting from [ ]. Liquidations and net losses, as a percentage of the outstanding balance of all contracts being serviced, [ ] from [ ], due to [ ].

In [ ], delinquencies [ ] from [ ], resulting from [ ]. Liquidations and net losses [ ] from [ ], due to [ ].

In [ ], delinquencies and liquidations [ ] from [ ] as a result of [ ]. Net losses, as a percentage of the outstanding balance of all contracts being serviced, generally [ ] during [ ] as a result of [ ].

In [ ], delinquencies, as a percentage of the total portfolio, [ ] from [ ] as a result of [ ]. In addition, liquidations and net losses [ ] in [ ] as a result of [ ].

Overall, the portfolio size increased during the period from [ ] through [ ] primarily due to increases in Harley-Davidson motorcycle production and the servicer's market share penetration of units financed.

In addition, beginning in February 2001, the servicer implemented a tiered pricing program which tightened the range of available credit in an effort to better match customer risk with contract rates and improve the quality of its portfolio. The contracts included in the trust were originated under the tiered pricing program and may perform differently than the servicer's entire portfolio during the

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periods described in the foregoing tables during which the tiered pricing program was not in place for all originations. There is no assurance that contracts included in the trust and originated under the tiered pricing program will perform as expected under current or other economic conditions. In addition, a general downturn in the economic environment is likely to cause an increase in delinquencies and net loss rates for the portfolio.

Yield and Prepayment Considerations

By their terms, the contracts may be prepaid, in whole or in part, at any time. Each contract also contains a provision which permits the seller to require full prepayment in the event of a sale of the related motorcycle securing a contract. In addition, repurchases of the contracts from the trust by the depositor, and concurrently from the depositor by the seller, could occur in the event of a breach of certain representations and warranties with respect to the contracts. In addition, the servicer may exercise its limited option to purchase all of the contracts from the trust when the aggregate outstanding principal balance of the contracts owned by the trust has declined to less than 10% of the sum of:

•: the aggregate outstanding principal balance of the contracts as of the initial cutoff date; and
•: the initial amount on deposit in the pre-funding account.

Any prepayments and repurchases of contracts will reduce the average life of the notes and the interest received by the noteholders over the life of the notes (for this purpose the term "prepayment" includes liquidations due to default, as well as receipt of proceeds from credit life, credit disability and casualty insurance policies and debt cancellation agreements). In addition, funds remaining in the pre-funding account at the end of the funding period will be used to prepay outstanding principal of the notes and, as a result, the interest received by noteholders over the life of the notes will be reduced.

Weighted Average Lives of the Notes

The rate of payments on the contracts will directly affect the rate at which you receive principal payments on your notes, and, if you purchase your notes at a premium or discount, your yield to maturity.

Prepayments on motorcycle contracts can be measured relative to a payment standard or model. In this prospectus supplement, the Absolute Prepayment Model ("ABS") represents an assumed rate of prepayment each month relative to the original number of contracts in a pool of contracts. ABS further assumes that all of the contracts in question are the same size and amortize at the same rate and that each contract in each month of its life will either be paid as scheduled or be prepaid in full. For example, in a pool of contracts originally containing 10,000 contracts, a 1% ABS rate means that 100 contracts prepay each month. ABS does not purport to be an historical description of prepayment experience or a prediction of the anticipated rate of prepayment of any pool of receivables, including the contracts.

As the rate of payment of principal of each class of notes will depend on the rate of payment (including prepayments) of the principal balance of the contracts, final payment of any class of notes could occur later or significantly earlier than the respective final scheduled payment date. Noteholders will bear any reinvestment risk associated with early payment of the notes. Reinvestment risk means the risk that market interest rates may be lower at the time such noteholders receive payments from the trust than the interest rate borne by the notes or than market interest rates had prepayments been made at a different time.

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The ABS Tables have been prepared on the assumption that:

•: the contracts prepay in full at the specified constant percentage of ABS monthly, with no defaults, losses or repurchases;
•: each scheduled monthly payment on each contract is scheduled to be made and is made on the last day of each month and each month has 30 days;
•: payments are made on the notes on each payment date (and each payment date is assumed to be the 15th day of each month whether or not a business day with a first payment date of [ ]);
•: the balance in the reserve fund on each payment date is the required amount described under "Prospectus Supplement Summary—Reserve Fund";
•: the notes are purchased on an assumed closing date of [ ]; and
•: the seller exercises its option to purchase the contracts at its earliest opportunity to do so.

The ABS Tables also assume that the contracts have been aggregated into hypothetical pools with all of the contracts within each pool having the following characteristics and that the level scheduled monthly payment for each of the pools will be such that each pool will be fully amortized by the end of its remaining term to maturity.

Initial Contracts

Pool		Balance		Contract Rate		Original Term to Maturity (In Months)		Remaining Term to Maturity (In Months)		Next Payment Date

Subsequent Contracts

Pool		Balance		Contract Rate		Original Term to Maturity (In Months)		Remaining Term to Maturity (In Months)		Next Payment Date

The ABS Tables indicate the projected weighted average life of each class of notes and set forth the percent of the initial principal amount of each class of notes that is projected to be outstanding after each of the payment dates shown at various constant ABS percentages.

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The actual characteristics and performance of the contracts will differ from the assumptions used to prepare the ABS Tables. The assumptions used are hypothetical and have been provided only to give a general sense of how the principal cash flows might behave under varying prepayment rates. Any difference between the assumptions and the actual characteristics and performance of the contracts or actual prepayment experience will affect the percentages of initial amounts outstanding over time and the weighted average lives of each class of notes.

	Class A-1 Notes Assumed ABS Percentage
Payment Dates	Class A-1 Notes Assumed ABS Percentage
Payment Dates	0.50%	1.00%	1.50%	2.00%	2.25%	2.50%
Weighted Average Life to Call(years)(1)
Weighted Average Life to Maturity(years)(1)(2)

(1): The weighted average life of a note is determined by (i) multiplying the amount of each principal payment on such note by the number of years from the date of the issuance of such note to the payment date on which it is made, (ii) adding the results and (iii) dividing the sum by the initial principal amount of such note.
(2): This calculation assumes that the seller does not exercise its option to purchase the contracts.

	Class A-2 Notes Assumed ABS Percentage
Payment Dates	Class A-2 Notes Assumed ABS Percentage
Payment Dates	0.50%	1.00%	1.50%	2.00%	2.25%	2.50%
Weighted Average Life to Call (years)(1)
Weighted Average Life to Maturity (years)(1)(2)

(1): The weighted average life of a note is determined by (i) multiplying the amount of each principal payment on such note by the number of years from the date of the issuance of such note to the payment date on which it is made, (ii) adding the results and (iii) dividing the sum by the initial principal amount of such note.
(2): This calculation assumes that the seller does not exercise its option to purchase the contracts.

	Class B Notes Assumed ABS Percentage
Payment Dates	Class B Notes Assumed ABS Percentage
Payment Dates	0.50%	1.00%	1.50%	2.00%	2.25%	2.50%
Weighted Average Life to Call (years)(1)
Weighted Average Life to Maturity (years)(1)(2)

(1): The weighted average life of a note is determined by (i) multiplying the amount of each principal payment on such note by the number of years from the date of the issuance of such note to the payment date on which it is made, (ii) adding the results and (iii) dividing the sum by the initial principal amount of such note.
(2): This calculation assumes that the seller does not exercise its option to purchase the contracts.

The ABS Tables have been prepared based on the assumptions described above (including the assumptions regarding the characteristics and performance of the contracts which will differ from the actual characteristics and performance of the contracts) and should be read in conjunction therewith.

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Description of the Notes

This section supplements the information in the accompanying prospectus under the caption "Description of the Notes and Indenture." However, as these statements are only summaries, you should read the sale and servicing agreement and indenture. The information in this section and in the accompanying prospectus under the caption "Description of the Notes and Indenture" describes the material terms of the notes, the indenture and the applicable transfer and servicing agreements, including the sale and servicing agreement. A copy of the indenture and the sale and servicing agreement are available to you upon request to the depositor and will be filed with the Securities and Exchange Commission following the issuance of the notes.

General

The notes will be issued pursuant to the terms of the indenture between the trust and the indenture trustee.

The trust will issue three classes of notes, consisting of two classes of senior notes, designated as the Class A-1 notes and Class A-2 notes. We refer to these notes as the "Class A notes." The trust will also issue one class of subordinate notes, designated as the Class B notes.

The notes will be delivered in book-entry form only and will be issued in minimum denominations of $1,000.

Interest

Each class of notes will bear interest at the fixed rate per annum for that class shown on the cover page of this prospectus supplement.

The trust will pay interest on the notes on each payment date with Available Amounts and amounts withdrawn from the reserve fund as set forth under "Certain Information Regarding the Notes—Payments and Distributions on the Notes—Distributions" below.

Interest will be payable to you monthly on the [ ] day of each month or, if that date is not a business day, on the next succeeding business day and will be calculated on the basis of a 360-day year consisting of twelve 30-day months for the interest period from and including the [ ] day of the prior month (or, in the case of the initial payment date, from and including the closing date) to but excluding the [ ] day of the next month.

After the acceleration of the notes following an event of default resulting from a payment default or certain insolvency events, the trust will not make interest payments on the Class B notes until the Class A notes have been paid in full.

Interest payments on the Class A notes will have the same priority. Interest payments on the Class B notes will be subordinated to interest payments on the Class A notes. If on any payment date the trust has insufficient funds to make a full payment of interest on the Class A notes, the holders of the Class A notes will receive their pro rata share of the amount available for interest on the Class A notes.

If on any payment date, the trust does not have sufficient funds to make a full payment of interest on any class of notes, the amount of the shortfall will be carried forward, and together with interest on the shortfall amount at the applicable interest rate for that class, added to the amount of interest the affected class of noteholders will be entitled to receive on the next payment date.

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Principal

On each payment date, principal on the notes will be payable in an amount equal to the amount by which (1) the aggregate principal balances of the contracts as of the close of business on the last day of the Due Period relating to the prior payment date (or in the case of the first payment date, the aggregate principal balances of the contracts as of the initial cutoff date) exceeds (2) the aggregate principal balance of the contracts as of the close of business on the last day of the Due Period relating to such payment date, excluding certain non-collectible or defaulted contracts and contracts to be repurchased by the depositor or purchased by the servicer due to certain breaches, but including the amount on deposit in the pre-funding account.

Principal payments on the Class A notes will be senior in priority to principal payments on the Class B notes. Principal payments on each payment date will generally be allocated [ ]% to the Class A notes and [ ]% to the Class B notes. However, any shortfall in the amount of funds available for principal payments on any payment date will reduce the principal payment on the Class B notes (up to the full amount of the payment) before the principal payment on the Class A notes will be reduced. Principal payments on the Class A notes will be paid sequentially, so that no principal will be paid on the Class A-2 notes until the Class A-1 notes have been paid in full. The trust will pay principal on the notes on each payment date with Available Amounts and amounts withdrawn from the reserve fund as set forth under "Certain Information Regarding the Notes—Payments and Distributions on the Notes—Distributions" below.

Principal of each class of notes is due and payable on the final scheduled payment date for that class shown on the cover page of this prospectus supplement.

Optional Redemption

The servicer has the option to purchase all of the contracts on any payment date if the aggregate outstanding principal balance of the contracts owned by the trust declines to less than 10% of the sum of:

•: the aggregate outstanding principal balance of the contracts as of the initial cutoff date; and
•: the initial amount on deposit in the pre-funding account.

If the seller exercises this option, the notes will be redeemed at a price equal to the unpaid principal amount of the notes plus accrued interest thereon.

Mandatory Redemption Following the Funding Period

The notes will be prepaid in part, without premium, on the payment date on or immediately following the last day of the funding period if any amount remains on deposit in the pre-funding account after subsequent contracts are transferred to the trust. The aggregate principal amount of notes to be prepaid will be an amount equal to the amount then on deposit in the pre-funding account allocated to the notes pro rata. If the amount on deposit in the pre-funding account is less than $150,000, only the Class A-1 noteholders will be prepaid.

Voting Rights

This prospectus supplement and the accompanying prospectus specify certain circumstances under which the consent, approval, direction or request of the holders of a specified percentage of the outstanding principal amount of the notes must be obtained, given or made, or under which such holders are permitted to take an action or give a notice. Except in limited circumstances, while the Class A notes are outstanding, only the holders of the Class A notes will have those rights, not the holders of all of the notes or the Class B notes.

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Notices

You will be notified in writing by the indenture trustee of any event of default, event of termination or termination of, or appointment of a successor to, the servicer promptly upon a responsible officer obtaining actual knowledge of these events. If notes are issued other than in book-entry form, those notices will be mailed to the addresses of noteholders as they appear in the register maintained by the indenture trustee prior to mailing. Those notices will be deemed to have been given on the date of that publication or mailing.

Certain Information Regarding the Notes

The Accounts

The Collection Account

The indenture trustee will establish an account referred to as the collection account in accordance with the sale and servicing agreement. The servicer will cause all collections made on or in respect of the contracts during a Due Period to be deposited in or credited to the collection account. The servicer is required to deposit, without deposit into any intervening account, into the collection account as promptly as practicable, but in any case not later than the second business day following the receipt thereof, all amounts received on or in respect of the contracts. However, if the servicer's short term debt security rating is at least "P-1" by Moody's Investors Service, Inc. and "A-1" by Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, the servicer may deposit into the collection account all amounts received on or in respect of the contracts on the business day immediately preceding each payment date. The servicer is required to use its best efforts to cause an obligor to make all payments on the contracts to one or more lockbox banks (either directly by remitting payments to a lockbox, or indirectly by making payments through direct debit, the telephone or the internet to an account of the servicer which payments will be subsequently transferred from such account to one or more lockbox banks), acting as agent for the trust pursuant to a lockbox agreement. Funds in the collection account will be invested in certain eligible investments. All income or other gain from such investments will be promptly deposited in, and any loss resulting from such investments shall be charged to, the collection account.

The Pre-Funding Account

The indenture trustee will establish a trust account referred to as the pre-funding account in accordance with the sale and servicing agreement. During the funding period, the pre-funding account will be maintained by the indenture trustee for your benefit to secure the depositor's obligations under the sale and servicing agreement to purchase and transfer subsequent contracts to the trust. On the closing date, the depositor will deposit $[ ] into the pre-funding account. During the funding period, amounts on deposit in the pre-funding account will be reduced by the amount thereof that the depositor uses to purchase subsequent contracts from the seller and contemporaneously transfers to the trust. The depositor expects that the pre-funded amount will be reduced to less than $150,000 by the payment date occurring in [ ]. Any pre-funded amount remaining at the end of the funding period will be payable to the noteholders. See "Description of the Notes—Mandatory Redemption Following the Funding Period".

The Reserve Fund

The servicer will establish pursuant to the sale and servicing agreement the reserve fund which will be a segregated account in the name of the indenture trustee. The reserve fund will be created with an initial deposit by the depositor on the closing date and will thereafter be funded as described below under "—Calculation of Reserve Fund Required Amount" and "Payments and Distributions on the Notes—Distributions".

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Amounts held from time to time in the reserve fund will be held for the benefit of noteholders and may be invested at the direction of the servicer in investments acceptable to the rating agencies rating the notes as being consistent with the ratings of the notes. Investment income on those investments will be paid to the depositor, upon the direction of the servicer, to the extent that funds on deposit in the reserve fund on any payment date exceed the amount that is required to be on deposit in the reserve fund. If the amount on deposit in the reserve fund on any payment date exceeds the amount that is required to be on deposit in the reserve fund on that payment date, the indenture trustee will withdraw that excess and pay it to the depositor. Upon any distribution to the depositor of those excess amounts, the noteholders will not have any rights in, or claims to, those amounts.

The servicer may, from time to time after the date of this prospectus supplement, request each rating agency rating the notes to approve a formula for determining the amount that is required to be on deposit in the reserve fund on each payment date that is different from that described below. If each rating agency delivers a letter to the indenture trustee and the trustee to the effect that the use of any new formula will not result in a qualification, reduction or withdrawal of its then-current rating of any class of the notes, then the amount that is required to be on deposit in the reserve fund will be determined in accordance with the new formula. The sale and servicing agreement will accordingly be amended, without the consent of any noteholder, to reflect the new calculation.

If Available Amounts for any payment date, after paying the servicing fee, reimbursing the servicer for servicer advances and paying the indenture trustee's fee, are insufficient to pay principal and interest on the notes, the indenture trustee will withdraw funds from the reserve fund for distribution to the noteholders to cover any shortfalls. If on the final scheduled payment date of any class of notes, the principal amount of that class has not been paid in full, the indenture trustee will withdraw funds from the reserve fund to pay those notes.

None of the noteholders, the indenture trustee, the servicer, or the depositor will be required to refund any amounts properly distributed or paid to them, whether or not there are sufficient funds on any subsequent payment date to make full distributions to the noteholders.

Calculation of Reserve Fund Required Amount

On the closing date, the depositor will deposit a total of $[ ] into the reserve fund. On any date on which subsequent contracts are transferred to the trust, an additional amount equal to [ ]% of the aggregate principal balance of those subsequent contracts will be deposited into the reserve fund. With respect to any payment date, the reserve fund required amount will equal the greater of (a) [ ]% of the aggregate principal balance of the contracts in the trust as of the last day of the immediately preceding Due Period; provided, however, that if certain trigger events occur, the reserve fund required amount will be equal to [ ]% of the aggregate principal balance of the contracts in the trust as of the last day of the immediately preceding Due Period and (b) [ ]% of the initial aggregate principal amount of the notes; provided, however, in no event shall the reserve fund required amount be greater than the aggregate outstanding principal balance of the notes. As of any payment date, the amount of funds actually on deposit in the reserve fund may, in certain circumstances, be less than the reserve fund required amount.

A "reserve fund trigger event" will have been deemed to occur with respect to any payment date if (i) the Average Delinquency Ratio for such payment date is equal to or greater than (a) [ ]% for any payment date which occurs within the period from the closing date to, and inclusive of, the first anniversary of the closing date, (b) [ ]% for any payment date which occurs within the period from the day after the first anniversary of the closing date to, and inclusive of, the second anniversary of the closing date, (c) [ ]% for any payment date which occurs within the period from the day after the second anniversary of the closing date to, and inclusive of, the third anniversary of the closing date or (d) [ ]% for any payment date following the third anniversary of the closing date; (ii) the

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Average Loss Ratio for such payment date is equal to or greater than (a) [ ]% for any payment date which occurs within the period from the closing date to, and inclusive of, the second anniversary of the closing date, or (b) [ ]% for any payment date following the second anniversary of the closing date; or (iii) the Cumulative Loss Ratio for such payment date is equal to or greater than (a) [ ]% for any payment date which occurs within the period from the closing date to, and inclusive of, the first anniversary of the closing date, (b) [ ]% for any payment date which occurs within the period from the day after the first anniversary of the closing date to, and inclusive of, the second anniversary of the closing date, (c) [ ]% for any payment date which occurs within the period from the day after the second anniversary of the closing date to, and inclusive of, the third anniversary of the closing date, or (d) [ ]% for any payment date following the third anniversary of the closing date.

A reserve fund trigger event will be deemed to have terminated with respect to a payment date if no reserve fund trigger event shall exist with respect to three consecutive payment dates (inclusive of the respective payment date).

Interest Reserve Account

The depositor will establish, and fund with an initial deposit on the closing date, the interest reserve account, for the purpose of providing additional funds for payment to the trust of carrying charges to pay certain distributions on payment dates that occur during (and on the first payment date following the end of) the funding period. In addition to the initial deposit, all investment earnings with respect to the pre-funding account are to be deposited into the interest reserve account and, pursuant to the sale and servicing agreement, on each payment date described above, amounts in respect of carrying charges will be paid from such account.

The interest reserve account will be established to account for the fact that a portion of the proceeds obtained from the sale of the notes will be initially deposited in the pre-funding account rather than invested in contracts, and the monthly investment earnings on amounts in the pre-funding account (until such amounts have been used to acquire subsequent contracts) are expected to be less than the weighted average of the interest rates of the respective classes of notes with respect to the corresponding portion of the principal balances of respective classes of notes, as well as the amount necessary to pay the indenture trustee's fee. The interest reserve account is not intended to provide any protection against losses on the contracts in the trust. After the funding period, funds in the interest reserve account will be released to the depositor.

The Distribution Account

The indenture trustee will establish and maintain with itself the distribution account, in the name of the indenture trustee on behalf of the noteholders, in which amounts released from the collection account, reserve fund, interest reserve account and pre-funding account for distribution to noteholders will be deposited and from which all distributions to noteholders will be made.

Determination of Outstanding Principal Balances

Prior to each payment date, the servicer will calculate a seven-digit decimal factor which represents:

•: the unpaid principal amount of the Class A-1 notes, after giving effect to payments to be made on such payment date, as a fraction of the initial outstanding principal amount of the Class A-1 notes;

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•: the unpaid principal amount of the Class A-2 notes, after giving effect to payments to be made on such payment date, as a fraction of the initial outstanding principal amount of the Class A-2 notes; and
•: the unpaid principal amount of the Class B notes, after giving effect to payments to be made on such payment date, as a fraction of the initial outstanding principal amount of the Class B notes.

If the servicer were to perform such calculations on the closing date, the resulting decimal factor for each of the notes would be 1.0000000. Thereafter, these decimal factors will decline in correspondence with reductions in the outstanding principal amount of the notes. Your portion of the aggregate outstanding principal amount of notes will be the product of:

•: the original denomination of the class of notes you own; and
•: the decimal factor relating to the class of notes at the time of determination (calculated as described above).

You will receive reports on or about each payment date concerning payments received on the contracts, the aggregate outstanding principal balance of the contracts owned by the trust, the decimal factors described above and various other items of information. In addition, noteholders of record during any calendar year will be furnished information for tax reporting purposes not later than the latest date permitted by law. See "Description of the Transfer and Servicing Agreements—Servicing—Statements to Securityholders" in the accompanying prospectus.

Payments and Distributions on the Notes

Available Amounts

The trust will pay principal and interest in respect of the notes on each payment date from Available Amounts for the payment date, as well as amounts permitted to be withdrawn from the reserve fund. See "Certain Information Regarding the Notes—The Accounts—The Reserve Fund." "Available Amounts" for any payment date are generally the sum of:

•

the following amounts on deposit in the collection account which the trust received during the prior calendar month:

(1): all amounts allocable to scheduled principal or interest payments on the contracts;
(2): prepayments of contracts; and
(3): proceeds of repossessed financed motorcycles and other proceeds of defaulted contracts;

•

the acquisition price paid by the depositor in repurchasing contracts from the trust on that payment date as a result of a breach of the representations and warranties with respect to those contracts in the sale and servicing agreement;

•

servicer advances made by the servicer on that payment date in respect of interest payments for the prior calendar month which were delinquent by 30 or more days; and

•

the amount paid by the servicer to purchase the contracts when the aggregate outstanding principal balance of the contracts owned by the trust is reduced to less than 10% of the sum of (i) aggregate outstanding principal balance of the contracts as of the initial cutoff date and (ii) the initial amount on deposit in the pre-funding account.

The precise calculation of the funds available to the trust on each payment date to make payments on the notes is set forth in the definition of "Available Amounts" and the definitions of the defined terms contained in that definition set forth in the Glossary. We refer you to those definitions.

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Servicing Compensation and Reimbursement of Servicer Advances

On each payment date, the servicer will be entitled to receive the servicing fee in an amount equal to the product of one twelfth (1/12th) of [ ] percent ([ ]%) and the aggregate principal balance of the contracts as of the first day of the calendar month preceding the month in which that payment date falls (or with respect to the first payment date, the aggregate principal balance of the contracts as of the initial cutoff date). The servicer will also be entitled to retain any late payment fees, prepayment charges, if any, and other similar fees and charges received during the prior calendar month.

The servicer is obligated to advance each month an amount equal to accrued and unpaid interest on each contract which was 30 days or greater delinquent with respect to the related Due Period, but only to the extent that the servicer believes that the amount of such advance will be recoverable from collections on such contract. The servicer will be entitled to reimbursement of its outstanding advances by means of a first priority withdrawal of certain funds then held in the collection account. See "Description of the Transfer and Servicing Agreements—Servicing—Advances" and "—Servicing—Net Deposits" in the prospectus and "—Distributions" in this prospectus supplement.

Distributions

On each payment date prior to the acceleration of the notes, the servicer will direct the indenture trustee to apply the Available Amounts, together with amounts withdrawn from the reserve fund, in the following order of priority:

(1): to the noteholders, the amount of any mandatory redemption, in the manner described under "Description of the Notes—Mandatory Redemption Following the Funding Period";
(2): reimbursement of servicer advances;
(3): payment of the servicing fee;
(4): payment of the indenture trustee's fee;
(5): all accrued and unpaid interest on the Class A notes, including any accrued and unpaid interest on the Class A notes payable on prior payment dates plus interest on that accrued and unpaid interest to the Class A-1 notes and the Class A-2 notes, pro rata;
(6): all accrued and unpaid interest on the Class B notes, including any accrued and unpaid interest on the Class B notes payable on prior payment dates plus interest on that accrued and unpaid interest;
(7): the Class A Note Principal Distributable Amount, first, to the Class A-1 notes until the Class A-1 notes have been paid in full, and second, to the Class A-2 notes until the Class A-2 notes have been paid in full;
(8): the Class B Note Principal Distributable Amount to the Class B notes until the Class B notes have been paid in full;
(9): to the reserve fund, any amount necessary to increase the amount on deposit in the reserve fund to the required amount; and
(10): any remaining amounts to the depositor as certificateholder under the trust agreement.

The trust is to make payments first from the Available Amounts, and second, but only as to amounts described in clauses (5), (6), (7) and (8) above, from amounts permitted to be withdrawn from the reserve fund as described under "Certain Information Regarding the Notes—The Accounts—Reserve Fund" above.

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On each payment date after an event of default due to a breach of a material covenant or agreement by the trust and acceleration of the notes, all distributions available to the noteholders will be made in the following priority:

•: all accrued and unpaid interest on the Class A notes, including any accrued and unpaid interest on the Class A notes payable on prior payment dates plus interest on that accrued and unpaid interest, to the Class A-1 notes and the Class A-2 notes, pro rata;
•: all accrued and unpaid interest on the Class B notes, including any accrued and unpaid interest on the Class B notes payable on prior payment dates plus interest on that accrued and unpaid interest;
•: any amounts remaining to the Class A notes, pro rata, until the Class A notes have been paid in full; and
•: any amounts remaining to the Class B notes until the Class B notes have been paid in full.

On each payment date after an event of default due to a payment default or certain insolvency events and acceleration of the notes, all distributions available to the noteholders will be made in the following priority:

•: all accrued and unpaid interest on the Class A notes, including any accrued and unpaid interest on the Class A notes payable on prior payment dates plus interest on that accrued and unpaid interest, to the Class A-1 notes and the Class A-2 notes, pro rata;
•: any amounts remaining to the Class A notes, pro rata, until the Class A notes have been paid in full;
•: all accrued and unpaid interest on the Class B notes, including any accrued and unpaid interest on the Class B notes payable on prior payment dates plus interest on that accrued and unpaid interest; and
•: any amounts remaining to the Class B notes until the Class B notes have been paid in full.

Material Federal Income Tax Consequences

Treatment of Trust

Winston & Strawn LLP, as federal tax counsel to the trust, will deliver its opinion that the trust will not be an association (or a publicly traded partnership) taxable as a corporation for federal income tax purposes. This opinion will be based on the assumptions and qualifications described in the accompanying prospectus under the caption "Material Federal Income Tax Consequences."

Treatment of Investors in Notes

Winston & Strawn llp, as federal tax counsel to the trust, will deliver its opinion that the notes will be characterized as indebtedness for federal income tax purposes. Each purchaser of the notes agrees to treat the notes as debt for federal, state and local income and franchise tax purposes. An investor will be taxed on the amount of payments of interest on a note as ordinary interest income at the time it accrues or is received in accordance with the investor's regular method of accounting. An accrual basis holder of a note with a maturity date of not more than one year from the issue date of that note (and some cash method holders, including regulated investment companies, as set forth in Section 1281 of the Code) generally would be required to report interest income as interest accrues on a straight-line basis or under a constant-yield method over the term of each interest period. In the case of notes with a term that is more than one year, such notes are not expected to be issued with original issue discount greater than a de minimis amount (one-fourth of one percent, or 0.25%, of the note's principal amount or other stated redemption price at maturity multiplied by the number of full years included in

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determining the weighted average maturity of the note). An investor who disposes of a note will recognize taxable gain or loss equal to the difference between the amount realized and the investor's adjusted tax basis in the note. Any gain or loss will be a capital gain or loss assuming the notes constitute capital assets in the hands of the owner. Special rules apply to investors who purchase notes at a discount or a premium. The foregoing general description of the treatment of investors in notes is subject to the further explanation, assumptions and qualifications set forth in the accompanying prospectus.

ERISA Considerations

The notes may be purchased by or with plan assets of an employee benefit plan, an individual retirement account or a similar arrangement (a "Plan") subject to ERISA or Section 4975 of the Internal Revenue Code of 1986, as amended (the "Code"). A fiduciary of a Plan must determine that the purchase of a note is consistent with its fiduciary duties under ERISA and does not result in a nonexempt prohibited transaction as defined in Section 406 of ERISA or Section 4975 of the Code. Some transactions involving a trust might be deemed to constitute prohibited transactions under ERISA and the Code with respect to a Plan that purchased notes if assets of the trust were deemed to be assets of the Plan. Under a regulation issued by the United States Department of Labor (the "Plan Assets Regulation"), the assets of a trust would be treated as plan assets of a Plan for the purposes of ERISA and the Code only if the Plan acquired an "equity interest" in the trust and none of the exceptions contained in the Plan Assets Regulation was applicable. An equity interest is defined under the Plan Assets Regulation as an interest other than an instrument which is treated as indebtedness under applicable local law and which has no substantial equity features. Although no assurances can be given in this regard, the notes should be treated as "debt" and not as "equity interests" for purposes of the Plan Assets Regulation because the notes (i) are expected to be treated as indebtedness under local law and (ii) should not be deemed to have any "substantial equity features." For additional information regarding treatment of the notes under ERISA, see "ERISA Considerations" in the accompanying prospectus.

Each person that acquires a note and that is or is acquiring the note on behalf of or with plan assets of a Plan will be deemed to have represented that its acquisition and holding of the note do not give rise to a prohibited transaction under Section 406 of ERISA or Section 4975 of the Code, or under any substantially similar applicable law, for which a statutory, regulatory or administrative exemption is not available.

Because the trust, the indenture trustee, the trustee, the servicer and the underwriters may receive benefits in connection with a sale of the notes, the purchase of notes with assets of a plan over which any of these parties or their affiliates has investment authority may be deemed to be a violation of the prohibited transaction rules of ERISA and the Code for which no exemption may be available. Accordingly, the fiduciary of a Plan considering a purchase of the notes should consult with counsel concerning possible prohibited transactions if any of these parties

•: has investment or administrative discretion with respect to the assets of the Plan,
•: has authority or responsibility to give, or regularly gives, investment advice with respect to those plan assets for a fee and pursuant to an agreement or understanding that the advice will serve as a primary basis for investment decisions with respect to those assets and will be based on the particular investment needs of the Plan, or
•: is an employer maintaining or contributing to the Plan.

The sale of any of the notes to a Plan is in no respect a representation by the trust, the depositor, the servicer, the seller or the underwriters that such an investment meets all relevant legal

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requirements relating to investments by Plans generally or any particular Plan, or that such an investment is appropriate for Plans generally or any particular Plan.

Legal Proceedings

None of the depositor, the servicer, the seller, or the trust are parties to any legal proceeding which could have a material adverse impact on your interest in the notes or in the trust's assets.

Underwriting

Subject to the terms and conditions set forth in the underwriting agreement among the depositor, the seller and the underwriters, the depositor has agreed to sell to each of the underwriters named below and each of those underwriters has severally agreed to purchase the following respective initial principal amounts of notes at the respective public offering prices less the respective underwriting discounts shown on the cover page of this prospectus supplement:

Underwriter		Initial Principal Amount of Class A-1 Notes		Initial Principal Amount of Class A-2 Notes		Initial Principal Amount of Class B Notes
Total

In the underwriting agreement, the underwriters have agreed, subject to the terms and conditions set forth therein, to purchase all of the notes being offered, if any of the notes are purchased. The underwriters have advised the depositor that they propose initially to offer the notes to the public at the respective public offering prices shown on the cover page of this prospectus supplement, and to certain dealers at that price, less a concession not in excess of the amount noted in the table below. The underwriters may allow and the dealers may reallow to other dealers a discount not in excess of the amount noted in the table below.

Class		Selling Concession Not to Exceed		Reallowance Not to Exceed
Class A-1 notes
Class A-2 notes
Class B notes

After the initial public offering of the notes, the offering prices and other selling terms may be varied by the underwriters.

Until the distribution of the notes is completed, rules of the Securities and Exchange Commission (the "SEC") may limit the ability of the underwriters and certain selling group members to bid for and purchase the notes. As an exception to these rules, the underwriters are permitted to engage in certain transactions that stabilize the price of the notes. Such transactions consist of bids or purchases for the purpose of pegging, fixing or maintaining the price of the notes.

If the underwriters create a short position in the notes in connection with this offering (i.e., they sell more notes than the aggregate initial principal amount set forth on the cover page of this prospectus supplement), the underwriters may reduce that short position by purchasing notes in the open market. In general, purchases of a security for the purpose of stabilization or to reduce a short position could cause the price of the security to be higher than it might be in the absence of such purchases.

Neither the seller, the servicer, the depositor, the trust nor any of the underwriters makes any representation or prediction as to the direction or magnitude of any effect that any of the transactions

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described above might have on the price of the notes. In addition, neither the seller, the servicer, the depositor, the trust nor any of the underwriters makes any representation that the underwriters will engage in such transactions or that such transactions, if commenced, will not be discontinued without notice.

There is currently no secondary market for the notes and you should not assume that one will develop. The underwriters currently expect, but are not obligated to make a market in the notes. You should not assume that any such market will develop, or if one does develop, that it will continue or provide sufficient liquidity.

Each underwriter has represented and agreed that:

(i): it has not offered or sold and, prior to the expiry of the period of six months from the issue date of the notes, will not offer or sell any notes to persons in the United Kingdom except to persons whose ordinary activities involve them in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of their businesses or otherwise in circumstances which have not resulted and will not result in an offer to the public in the United Kingdom within the meaning of the Public Offers of Securities Regulations 1995, as amended;
(ii): it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the Financial Services and Markets Act 2000 of the United Kingdom (the "FSMA")) received by it in connection with the issue or sale of any notes in circumstances in which section 21(1) of the FSMA does not apply to the trust; and
(iii): it has complied and will comply with all applicable provisions of the FSMA and any applicable secondary legislation made under the FSMA with respect to anything done by it in relation to the notes in, from or otherwise involving the United Kingdom.

No action has been taken by the trust or the underwriters which would or is intended to permit a public offer of the notes in any country or jurisdiction (other than the United States of America) where action for that purpose is required. Accordingly, no offer or sale of any notes has been authorized in any country or jurisdiction (other than the United States of America) where action for that purpose is required and neither the prospectus nor this prospectus supplement nor any other circular, prospectus, form of application, advertisement or other material may be distributed in or from or published in any country or jurisdiction (other than the United States of America), except under circumstances which will result in compliance with applicable laws and regulations.

The underwriting agreement provides that the seller and the depositor will indemnify the underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or contribute to payments the underwriters may be required to make in respect thereof.

In the ordinary course of their respective businesses, the underwriters and their respective affiliates have engaged and may in the future engage in investment banking or commercial banking transactions with Harley-Davidson, Inc., Harley-Davidson Credit Corp., Harley-Davidson Financial Services, Inc. or any of their respective affiliates.

Ratings of the Notes

It is a condition of issuance that each of the Class A-1 notes and Class A-2 notes be rated "[ ]" by Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. and "[ ]" by Moody's Investors Service, Inc. and the Class B notes be rated at least "[ ]" by Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. and "[ ]" by Moody's Investors Service, Inc.

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There is no assurance that any such rating will continue for any period of time or that it will not be revised or withdrawn entirely by the assigning rating agency if, in its judgment, circumstances so warrant. A revision or withdrawal of such rating may have an adverse effect on the market price of the notes. A security rating is not a recommendation to buy, sell or hold the notes.

Legal Matters

Certain legal matters with respect to the notes, including certain federal income tax matters, will be passed upon for the seller, the servicer, the depositor and the trust by Winston & Strawn LLP, Chicago, Illinois. Certain legal matters for the underwriters will be passed upon by [ ].

Experts

The balance sheet of Harley-Davidson Motorcycle Trust [ ] at [ ], appearing in this prospectus supplement has been audited by [ ], independent registered public accounting firm, as set forth in their report thereon appearing elsewhere herein, and is included in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

Reports to Noteholders

Unless and until the notes are issued in physical form, monthly and annual unaudited reports containing information concerning the contracts will be prepared by the servicer, and sent on behalf of the trust only to Cede & Co., as nominee of The Depository Trust Company and registered holder of the notes. No financial reports will be sent to you. See "Information Regarding the Securities—Book-Entry Registration" and "Description of the Transfer and Servicing Agreements—Servicing—Statements to Securityholders" in the prospectus. Such reports will not constitute financial statements prepared in accordance with generally accepted accounting principles. The administrator, on behalf of the trust, will file with the SEC such periodic reports of the trust as are required under the Securities Exchange Act of 1934, as amended and the rules and regulations of the SEC thereunder.

We filed a registration statement relating to the notes with the SEC. This prospectus supplement is part of the registration statement, but the registration statement includes additional information.

You may read and copy any reports, statements or other information we file with the SEC at the SEC's public reference room at 450 Fifth Street, NW., Washington, DC, 20549. You can request copies of these documents, upon payment of a duplicating fee, by writing to the SEC. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference room. Our filings with the SEC are also available to the public on the SEC Internet site (http://www.sec.gov).

The SEC allows us to "incorporate by reference" information we file with it, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be part of this prospectus supplement. Information that we file later with the SEC will automatically update the information in this prospectus supplement. In all cases, you should rely on the later information over different information included in this prospectus supplement or in the accompanying prospectus. We incorporate by reference any future annual, monthly and special SEC reports and proxy materials filed by or on behalf of the trust until we terminate our offering of the notes.

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As a recipient of this prospectus, you may request a copy of any document we incorporate by reference, except exhibits to the documents (unless the exhibits are specifically incorporated by reference), at no cost, by writing or calling us at:

Harley-Davidson Credit Corp.
150 South Wacker Drive, Suite 3100
Chicago, Illinois 60606
Attention: Treasurer
(telephone (312) 368-9501;
facsimile (312) 368-4372).

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ANNEX I

Global Clearance, Settlement and Tax Documentation Procedures

Except in certain limited circumstances, the globally offered notes (the "Global Securities") will be available only in book-entry form. Investors in the Global Securities may hold such Global Securities through The Depository Trust Company ("DTC") and, in the case of the Notes, Euroclear or Clearstream. The Global Securities will be tradable as home market instruments in both the European and U.S. domestic markets. Initial settlement and all secondary trades will settle in same-day funds.

Secondary market trading between investors holding Global Securities through Euroclear and Clearstream will be conducted in the ordinary way in accordance with their normal rules and operating procedures and in accordance with conventional eurobond practice (i.e. seven calendar day settlement).

Secondary market trading between investors holding Global Securities through DTC will be conducted according to the rules and procedures applicable to U.S. corporate debt obligations.

Secondary cross-market trading between Euroclear or Clearstream and DTC participants holding Global Securities will be effected on a delivery-against-payment basis through the respective depositaries of Euroclear and Clearstream (in such capacity) and as DTC participants.

Non-U.S. holders (as described below) of Global Securities will be subject to U.S. withholding taxes unless such holders meet certain requirements and deliver appropriate U.S. tax documents to the securities clearing organizations or their participants.

Initial Settlement

All Global Securities will be held in book-entry form by DTC in the name of Cede & Co. as nominee of DTC. Investors' interests in the Global Securities will be represented through financial institutions acting on their behalf as direct and indirect participants in DTC. As a result, Euroclear and Clearstream will hold positions on behalf of their participants through their respective depositaries, which in turn will hold such positions in accounts as DTC participants.

Investors electing to hold their Global Securities through DTC will follow the settlement practices applicable to similar issues on pass-through certificates. Investors' securities custody accounts will be credited with their holdings against payment in same-day funds on the settlement date.

Investors electing to hold their Global Securities through Euroclear or Clearstream accounts will follow the settlement procedures applicable to conventional eurobonds, except that there will be no temporary global security and no "lock-up" or restricted period. Global Securities will be credited to the securities custody accounts on the settlement date against payments in same-day funds.

Secondary Market Trading

Since the purchaser determines the place of delivery, it is important to establish the time of the trade where both the purchaser's and seller's accounts are located to ensure that settlement can be made on the desired value date.

Trading between DTC Participants. Secondary market trading between DTC participants will be settled using the procedures applicable to similar issues of securities in same-day funds.

Trading between Euroclear and/or Clearstream Participants. Secondary market trading between Euroclear participants or Clearstream participants will be settled using the procedures applicable to conventional eurobonds in same-day funds.

Trading between DTC seller and Euroclear or Clearstream purchaser. When Global Securities are to be transferred from the account of a DTC participant to the account of a Euroclear participant or a

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Clearstream participant, the purchaser will send instructions to Euroclear or Clearstream through a Euroclear participant or Clearstream participant at least one business day prior to settlement. Euroclear or Clearstream will instruct the respective depositary, as the case may be, to receive the Global Securities against payment. Payment will include interest accrued on the Global Securities from and including the last coupon payment date to and excluding the settlement date. Payment will then be made by the respective depositary to the DTC participant's account against delivery of the Global Securities. After settlement has been completed, the Global Securities will be credited to the respective clearing system and by the clearing system, in accordance with its usual procedures, to the Euroclear participant's or Clearstream participant's account. The Global Securities credit will appear the next day (European time) and the cash debit will be back-valued to, and the interest on the Global Securities will accrue from, the value date; (which would be the preceding day when settlement occurred in New York). If settlement is not completed on the intended value date (i.e., the trade fails), the Euroclear or Clearstream cash debit will be valued instead as of the actual settlement date.

Euroclear participants and Clearstream participants will need to make available to the respective clearing systems the funds necessary to process same-day funds settlement. The most direct means of doing so is to pre-position funds for settlement, either from cash on hand or existing lines of credit, as they would for any settlement occurring within Euroclear or Clearstream. Under this approach, they may take on credit exposure to Euroclear or Clearstream until the Global Securities are credited to their accounts one day later.

As an alternative, if Euroclear or Clearstream has extended a line of credit to them, Euroclear participants or Clearstream participants can elect to pre-position funds and allow that credit line to be drawn upon the finance settlement. Under this procedure, Euroclear participants or Clearstream participants purchasing Global Securities would incur overdraft charges for one day, assuming they cleared the overdraft when the Global Securities were credited to their accounts. However, interest on the Global Securities would accrue from the value date. Therefore, in many cases the investment income on the Global Securities earned during that one-day period may substantially reduce or offset the amount of such overdraft charges, although this result will depend on each Euroclear participant's or Clearstream participant's particular cost of funds.

Since the settlement is taking place during New York business hours, DTC participants can employ their usual procedures for sending Global Securities to the respective Depositary for the benefit of Euroclear participants or Clearstream participants. The sale proceeds will be available to the DTC seller on the settlement date. Thus, to the DTC participant a cross-market transaction will settle no differently than a trade between two DTC participants.

Trading between Euroclear or Clearstream seller and DTC purchaser. Due to time zone differences in their favor, Euroclear participants and Clearstream participants may employ their customary procedures for transactions in which Global Securities are to be transferred by the respective clearing system, through the respective Depositary, to a DTC participant. The seller will send instructions to Euroclear or Clearstream through a Euroclear participant or Clearstream participant at least one business day prior to settlement. In these cases, Euroclear or Clearstream will instruct the respective Depositary, as appropriate, to deliver the bonds to the DTC participant's account against payment. Payment will include interest accrued on the Global Securities from and including the last coupon payment date to and excluding the settlement date. The payment will then be reflected in the account of the Euroclear participant or Clearstream participant the following day, and receipt of the cash proceeds in the Euroclear participant's or Clearstream participant's account, would be back-valued to the value date (which would be the preceding day, when settlement occurred in New York). Should the Euroclear participant or Clearstream participant have a line of credit with its respective clearing system and elect to be in debit in anticipation or receipt of the sale proceeds in its account, the back-valuation will extinguish any overdraft charges incurred over that one-day-period. If settlement is not completed on the intended value date (i.e., the trade fails), receipt of the cash proceeds in the Euroclear

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participant's or Clearstream participant's account would instead be valued as of the actual settlement date. Finally, day traders that use Euroclear or Clearstream and that purchase Global Securities from DTC participants for delivery to Euroclear participants or Clearstream participants should note that these trades would automatically fail on the sale side unless affirmative action were taken. At least three techniques should be readily available to eliminate this potential problem:

(a): borrowing through Euroclear or Clearstream for one day (until the purchase side of the day trade is reflected in their Euroclear or Clearstream accounts) in accordance with the clearing system's customary procedures;
(b): borrowing the Global Securities in the U.S. from a DTC participant no later than one day prior to settlement, which would give the Global Securities sufficient time to be reflected in their Euroclear or Clearstream account in order to settle the sale side of the trade; or
(c): staggering the value dates for the buy and sell sides of the trade so that the value date for the purchase from the DTC participant is at least one day prior to the value date for the sale to the Euroclear participant or Clearstream participant.

Certain U.S. Federal Income Tax Documentation Requirements

A beneficial owner of Global Securities holding securities through Euroclear or Clearstream (or through DTC if the holder has an address outside the U.S.) will be subject to the 30% U.S. withholding tax that generally applies to payments of interest (including original issue discount) on registered debt issued by U.S. Persons, unless (i) each clearing system, bank or other financial institution that holds customers' securities in the ordinary course of its trade or business in the chain of intermediaries between such beneficial owner and the U.S. entity required to withhold tax complies with applicable certification requirements and (ii) such beneficial owner takes one of the following steps to obtain an exemption or reduced tax rate:

Exemption for non-U.S. Persons (Form W-8BEN). Beneficial owners of Securities that are non-U.S. Persons can obtain a complete exemption from the withholding tax by filing a signed Form W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding). If the information shown on Form W-8BEN changes, a new Form W-8BEN must be filed within 30 days of such change.

Exemption for non-U.S. Persons with effectively connected income (Form W-8ECI). A non-U.S. Person, including a non-U.S. corporation or bank with a U.S. branch, for which the interest income is effectively connected with its conduct of a trade or business in the United States, can obtain an exemption from the withholding tax by filing Form W-8ECI (Certificate of Foreign Person's Claim for Exemption from Withholding on Income Effectively Connected with the Conduct of a Trade or Business in the United States).

Exemption or reduced rate for non-U.S. Persons resident in treaty countries (Form W-8BEN). Non-U.S. Persons that are Securityholders residing in a country that has a tax treaty with the United States can obtain an exemption or reduced tax rate (depending on the treaty terms) by filing Form W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding). Form W-8BEN may be filed by the Securityholder or his agent.

Exemption for U.S. Persons (Form W-9). U.S. Persons can obtain a complete exemption from the withholding tax by filing Form W-9 (Payer's Request for Taxpayer Identification Number and Certification).

U.S. Federal Income Tax Reporting Procedures. The holder of a Global Security or in the case of a Form W-8BEN or a Form W-8ECI filer, his agent, files by submitting the appropriate form to the person through whom it holds (the clearing agency, in the case of persons holding directly on

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the books of the clearing agency). Form W-8BEN and Form W-8ECI are effective until the third succeeding calendar year from the date the form is signed.

The term "U.S. Person" means (i) a citizen or resident of the United States, (ii) a corporation or partnership (or other business entity treated as such) created or organized in or under the laws of the United States, any state or political subdivision thereof or the District of Columbia, (iii) an estate the income of which is includible in gross income for United States federal income tax purposes, regardless of its source or (iv) a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons have the authority to control all substantial decisions of the trust. Notwithstanding the preceding sentence, to the extent provided in Treasury regulations, certain trusts in existence on August 20, 1996, and treated as United States persons under the United States Internal Revenue Code of 1986, as amended (the "Code") and applicable Treasury regulations thereunder prior to such date, that elect to continue to be treated as United States persons under the Code or applicable Treasury regulations thereunder also will be a U.S. Person. This summary does not deal with all aspects of U.S. Federal income tax withholding that may be relevant to foreign holders of the Global Securities. Investors are advised to consult their own tax advisors for specific tax advice concerning their holding and disposing of the Global Securities.

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Glossary of Terms

Aggregate Principal Balance is the sum of the Principal Balances of each outstanding contract and the amounts in the pre-funding account. At the time of initial issuance of the notes and certificate, the initial aggregate principal amount of the notes will equal the sum of the Principal Balances of the contracts as of the initial cutoff date plus the initial deposit into the pre-funding account.

Aggregate Principal Balance Decline means, with respect to any payment date, the amount by which the Aggregate Principal Balance as of the close of business on the last day of the Due Period relating to the payment date immediately preceding that payment date (or as of the initial cutoff date in the case of the first payment date) exceeds the Aggregate Principal Balance as of the close of business on the last day of the Due Period relating to such payment date.

Available Amounts means, with respect to any payment date, the sum of the Available Interest and the Available Principal for such payment date.

Available Interest means, with respect to any payment date, the total, without duplication, of the following amounts received by the servicer on or in respect of the contracts during the prior calendar month:

•: all amounts received in respect of interest on the contracts;
•: the interest component of all Net Liquidation Proceeds;
•: the interest component of the purchase price paid by the depositor in repurchasing contracts from the trust on that payment date as a result of a breach of the representations and warranties with respect to those contracts in the sale and servicing agreement;
•: all amounts received in respect of carrying charges transferred from the interest reserve account;
•: all amounts received in respect of interest, dividends, gains, income and earnings on investment of funds in the trust accounts;
•: servicer advances made by the servicer on that payment date in respect of interest payments for the prior calendar month which were delinquent by 30 or more days; and
•: the interest component of the amount paid by the servicer to purchase the contracts when the aggregate principal balance of the contracts is reduced to less than 10% of the sum of (i) the aggregate outstanding principal balance of the contracts as of the initial cutoff date and (ii) the initial amount on deposit in the pre-funding account.

Available Principal means, with respect to any payment date, the total, without duplication, of the following amounts received by the servicer on or in respect of the contracts during the prior calendar month:

•: all amounts received in respect of principal on the contracts;
•: the principal component of all Net Liquidation Proceeds;
•: the principal component of the purchase price paid by the depositor in repurchasing contracts from the trust on that payment date as a result of a breach of the representations and warranties with respect to those contracts in the sale and servicing agreement; and
•: the principal component of the amount paid by the servicer to purchase the contracts when the aggregate principal balance of the contracts is reduced to less than 10% of the sum of (i) the aggregate outstanding principal balance of the contracts as of the initial cutoff date and (ii) the initial amount on deposit in the pre-funding account.

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Average Delinquency Ratio with respect to any payment date, is equal to the arithmetic average of the Delinquency Ratios for the payment date and the two immediately preceding payment dates.

Average Loss Ratio for any payment date is equal to the arithmetic average of the Loss Ratios for such payment date and the two immediately preceding payment dates. The "Loss Ratio" for any payment date is equal to the fraction (expressed as a percentage) derived by dividing (x) the Net Liquidation Losses for all contracts that became Liquidated Contracts during the immediately preceding month multiplied by 12 by (y) the outstanding Principal Balances of all contracts as of the beginning of the related month.

Class A Note Monthly Principal Distributable Amount means, on any payment date, the Class A Note Percentage of the Principal Distributable Amount for that payment date.

Class A Note Percentage is (i) [ ]%, for each payment date to but excluding the payment date on which the Class A notes are paid in full; (ii) on the payment date on which the Class A notes are paid in full, that percentage which represents the fraction of the Principal Distributable Amount necessary to reduce the principal amount of the Class A notes to zero; and (iii) [ ]% thereafter.

Class A Note Principal Carryover Shortfall means, as of the close of any payment date, the excess of the Class A Note Principal Distributable Amount with respect to the immediately preceding payment date over the amount in respect of principal that was actually paid to the Class A Notes on that payment date.

Class A Note Principal Distributable Amount means, on any payment date, the sum of the Class A Note Monthly Principal Distributable Amount for that payment date and any outstanding Class A Note Principal Carryover Shortfall for the immediately preceding payment date; provided, however, that the Class A Note Principal Distributable Amount shall not exceed the outstanding principal amount of the Class A notes. Notwithstanding the foregoing, the Class A Note Principal Distributable Amount on the scheduled final payment date for the Class A notes shall not be less than the amount that is necessary (after giving effect to other amounts to be paid to the Class A notes on that payment date and allocable to principal) to pay the Class A notes in full.

Class B Note Monthly Principal Distributable Amount means, on any payment date, the Class B Note Percentage of the Principal Distributable Amount for that payment date.

Class B Note Percentage means (i) for each payment date to but excluding the payment date on which the Class A notes are paid in full, [ ]%; (ii) on the payment date on which the Class A notes are paid in full, that percentage that equals 100% minus the Class A Note Percentage; and (iii) [ ]% thereafter.

Class B Note Principal Carryover Shortfall means, as of the close of any payment date, the excess of the Class B Note Principal Distributable Amount with respect to the immediately preceding payment date, over the amount in respect of principal that was actually paid to the Class B notes on that payment date.

Class B Note Principal Distributable Amount means, on any payment date, the sum of the Class B Note Monthly Principal Distributable Amount and any outstanding Class B Note Principal Carryover Shortfall as of the close of the immediately preceding payment date; provided, however, that the Class B Note Principal Distributable Amount shall not exceed the outstanding principal amount of the Class B notes. Notwithstanding the foregoing, the Class B Note Principal Distributable Amount on the scheduled final payment date for the Class B notes shall not be less than the amount that is necessary (after giving effect to other amounts to be paid to the Class B notes on that payment date and allocable to principal) to pay the Class B notes in full.

Cumulative Loss Ratio for any payment date means the fraction (expressed as a percentage) computed by the servicer by dividing (a) the aggregate Net Liquidation Losses for all contracts since

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the related cutoff date through the end of the related Due Period by (b) the sum of (i) the principal balance of the contracts as of the initial cutoff date plus (ii) the principal balance of any subsequent contracts as of the related subsequent cutoff date plus (iii) the amount on deposit in the pre-funding account as of the close of business on such payment date.

Delinquency Amount as of any payment date means the principal balance of all contracts that were delinquent 60 days or more as of the end of the related month (including contracts in respect of which the related motorcycles have been repossessed and are still in inventory).

Delinquency Ratio for any payment date is equal to the fraction (expressed as a percentage) derived by dividing (a) the Delinquency Amount during the immediately preceding month by (b) the Principal Balance of the contracts as of the beginning of the related month.

Due Period means a calendar month, and the Due Period related to a payment date shall be the calendar month immediately preceding such date.

A Liquidated Contract means a contract with respect to which there has occurred one or more of the following: (i) 90 days have elapsed following the date of repossession (and expiration of any redemption period) with respect to the motorcycle securing such contract, (ii) the receipt of proceeds by the servicer from the sale of a repossessed motorcycle securing a contract, (iii) the servicer has determined in good faith that all amounts expected to be recovered have been received with respect to such contract, or (iv) all or any portion of any payment is delinquent 150 days or more.

Net Liquidation Losses means, with respect to all Liquidated Contracts on an aggregate basis, the amount, if any, by which (a) the outstanding Principal Balance of all Liquidated Contracts plus accrued and unpaid interest thereon at the annual interest rate stated in such Liquidated Contracts to the date on which such Liquidated Contracts became Liquidated Contracts exceeds (b) the Net Liquidation Proceeds for such Liquidated Contracts.

Net Liquidation Proceeds means, as to any Liquidated Contract, the proceeds realized on the sale or other disposition of the related motorcycle, including proceeds realized on the repurchase of such motorcycle by the originating dealer for breach of warranties, and the proceeds of any insurance relating to such motorcycle, after payment of all expenses incurred thereby, together, in all instances, with the expected or actual proceeds of any recourse rights relating to such contract as well as any post disposition proceeds or other amounts in respect of a Liquidated Contract received by the servicer.

Principal Balance means, (a) with respect to any contract as of any date, an amount equal to the unpaid principal balance of such contract as of the opening of business on the related cutoff date, reduced by the sum of (x) all payments and other amounts received by the servicer as of such date allocable to principal and (y) any amount by which a court of appropriate jurisdiction in an insolvency proceeding has ordered the unpaid principal balance of such contract be reduced; provided, however, that (i) if (x) a contract is repurchased by the seller because of a breach of a representation or warranty, or if (y) the seller gives notice of its intent to purchase the contracts in connection with an optional termination of the trust, in each case the Principal Balance of such contract or contracts shall be deemed to be zero for the prior calendar month in which such event occurs and for each calendar month thereafter and (ii) from and after the Due Period in which a contract becomes a Liquidated Contract, the Principal Balance of such contract shall be deemed to be zero; and (b) where the context requires, the aggregate Principal Balances described in clause (a) for all such contracts.

Principal Distributable Amount means, on any payment date, the Aggregate Principal Balance Decline for that payment date.

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Report of Independent Registered Public Accounting Firm

We have audited the accompanying balance sheet of Harley-Davidson Motorcycle Trust [ ] as of [ ]. This balance sheet is the responsibility of the Trust's management. Our responsibility is to express an opinion on this balance sheet based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the balance sheet is free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the balance sheet. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall balance sheet presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the balance sheet referred to above presents fairly, in all material respects, the financial position of Harley-Davidson Motorcycle Trust [ ] at [ ], in conformity with U.S. generally accepted accounting principles.

/s/ [ ]

Chicago, Illinois
[ ]

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Harley-Davidson Motorcycle Trust [ ]
Balance Sheet as of [ ]

Assets—Cash	$	1,000

Liabilities	$	0

Beneficial Equity	$	1,000

Notes to the Balance Sheet

Harley-Davidson Motorcycle Trust [ ] is a limited purpose statutory trust established under the laws of the State of Delaware. It was formed on [ ] under a trust agreement dated as of [ ] between the depositor and the trustee. The activities of the trust are limited by the terms of the trust agreement to acquiring, owning and managing loan contracts and related assets, issuing and making payments on notes and the certificate and other related activities. Prior to and including [ ], the trust did not conduct any activities.

The depositor will pay all fees and expenses related to the organization and operations of the trust, other than withholding taxes, imposed by the United States or any other domestic taxing authority. The depositor has also agreed to indemnify the indenture trustee, the trustee and certain other persons involved in the sale of notes.

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Until 90 days after the date of this prospectus supplement, all dealers effecting transactions in the securities offered by this prospectus supplement, whether or not participating in this distribution, may be required to deliver this prospectus supplement and the prospectus. This is in addition to the obligation of dealers to deliver this prospectus supplement and the prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

$[ ]

Harley-Davidson Motorcycle Trust [ ]

Harley-Davidson Customer Funding Corp.
Depositor

Harley-Davidson Credit Corp.
Seller and Servicer

PROSPECTUS SUPPLEMENT
[ ]

[Underwriters]

SUBJECT TO COMPLETION, DATED [ ]

THE INFORMATION CONTAINED IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

PROSPECTUS

Harley-Davidson Motorcycle Trusts
Asset Backed Notes
(Issuable in Series)

Harley-Davidson Customer Funding Corp.,
as depositor

Harley-Davidson Credit Corp.,
as seller and servicer

The trusts:

The depositor will form a new trust to issue each series of securities. The trust will offer the securities under this prospectus and a prospectus supplement which will be prepared separately for each series. Each trust will own a pool of conditional sales contracts and promissory note and security agreements.

The offered securities:

•: will consist of motorcycle contract backed securities sold periodically in one or more series which may include one or more classes of notes;
•: will be paid only from the assets of the related trust;
•: will be rated in one of the four highest rating categories by at least one nationally recognized statistical rating organization;
•: may have one or more forms of credit enhancement; and
•: will be issued as part of a designated series that may include one or more classes with payment rights that are senior or subordinate to the rights of one or more of the other classes of securities.

You should carefully consider the factors set forth under "Risk Factors" on page [ ] of this prospectus and the other risk factors included in the accompanying prospectus supplement.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined that this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The amounts, prices and terms of each offering of securities will be determined at the time of sale and will be described in a prospectus supplement that will be attached to this prospectus.

This prospectus may not be used to offer and sell any series of securities unless accompanied by the prospectus supplement for that series.

Prospectus dated [ ]

Table of Contents

		Page
Important Notice About Information Presented in this Prospectus and the Accompanying Prospectus Supplement		ii
Prospectus Summary		1
Risk Factors		6
Harley-Davidson Motorcycles		15
Other Manufacturers		15
The Seller and Servicer		15
The Contracts		16
The Depositor		18
The Trusts		18
Use of Proceeds		19
The Trustee and the Indenture Trustee		20
Delinquencies, Repossessions and Net Losses		20
Weighted Average Lives of the Securities		20
Factors and Trading Information		21
Description of the Notes and Indenture		22
Information Regarding the Securities		29
Description of the Transfer and Servicing Agreements		39
Legal Aspects of the Contracts		50
Material Federal Income Tax Consequences		58
ERISA Considerations		65
Ratings of the Securities		67
Plan of Distribution		68
Legal Matters		68
Where You Can Find More Information		68

Important Notice About Information Presented in this Prospectus and the Accompanying Prospectus Supplement

We provide information to you about the securities in two separate documents that offer varying levels of detail:

•: this prospectus—which provides general information, some of which may not apply to a particular series of securities including your series, and
•: the accompanying prospectus supplement—which provides a summary of the specific terms of your series of securities.

We have included cross-references in this prospectus and the accompanying prospectus supplement to captions in these materials where you can find further discussions. The table of contents included in this prospectus and the accompanying prospectus supplement provide the pages on which these captions are located. References to "we", "our" and "us" refer to Harley-Davidson Customer Funding Corp.

Whenever we use words like "intends," "anticipates" or "expects" or similar words in this prospectus, we are making a forward-looking statement, or a projection of what we think will happen in the future. Forward-looking statements are inherently subject to a variety of circumstances, many of which are beyond our control and could cause actual results to differ materially from what we anticipate. Any forward-looking statements in this prospectus speak only as of the date of this prospectus. We do not assume any responsibility to update or review any forward-looking statement contained in this prospectus to reflect any change in our expectation about the subject of that forward-looking statement or to reflect any change in events, conditions or circumstances on which we have based any forward-looking statement.

You should rely only on the information contained in this document, including the information described under the heading "Where You Can Find More Information" in the prospectus. We have not authorized anyone to provide you with any different information or make any representation not contained in this prospectus. If anyone makes such a representation to you, you should not rely on it.

Prospectus Summary

This summary highlights selected information from this prospectus and does not contain all the information that you should consider in making an investment decision. You should read carefully this entire prospectus and the accompanying prospectus supplement to understand all of the terms of the offering of your series of securities. In addition, you may wish to read the documents governing the transfers and servicing of the contracts, the formation of each trust and the issuance of the securities. Forms of these documents have been filed as exhibits to the registration statement of which this prospectus is a part and final versions of these documents will be filed with the Securities and Exchange Commission following the issuance of your series of securities.

There are material risks associated with an investment in the securities. See "Risk Factors" in this prospectus and in the accompanying prospectus supplement for a discussion of factors you should consider before investing in the securities.

Trust	For each series of securities, the depositor will form an owner trust. An "owner trust" will issue notes and a certificate and will be formed by a trust agreement between the depositor and the trustee of the owner trust.
Depositor	Harley-Davidson Customer Funding Corp., a wholly-owned subsidiary of Harley-Davidson Credit Corp. The depositor will deposit the contracts into the trust.
Seller	Harley-Davidson Credit Corp. will sell the contracts to the depositor for deposit into the trust.
Originators	Eaglemark Savings Bank, a Nevada corporation, state chartered thrift and wholly-owned subsidiary of Harley-Davidson Credit Corp. and certain motorcycle dealers will originate the contracts in accordance with the underwriting standards set by Harley-Davidson Credit Corp. under agreements governing the assignment of the contracts to the seller. The seller will acquire the contracts from Eaglemark Savings Bank and motorcycle dealers in the ordinary course of its business pursuant to such agreements.
Servicer	Harley-Davidson Credit Corp. will service the contracts unless otherwise specified in your prospectus supplement.
Trustee	The trustee of the trust for your series of securities will be identified in your prospectus supplement.
Indenture Trustee	If the trust issues notes, the trustee for the indenture under which the notes will be issued will be identified in your prospectus supplement.
Administrator	Harley-Davidson Credit Corp. will provide notices and perform other administrative functions for each trust.
The Securities	A series of securities will include one or more of classes of notes which will be issued pursuant to an indenture.
Terms of the Securities	Your prospectus supplement provides the particular terms of your class of notes, including:
	•	the stated principal amount of each class of notes; and

	•	the interest rate, which may be fixed, variable, adjustable or some combination of these rates, or the formula for calculating the interest rate.
	The terms of a class of notes may differ from those of other classes of notes of the same series in one or more aspects, including:
	•	timing and priority of payments;
	•	seniority;
	•	allocations of losses;
	•	interest rate or formula for calculating the interest rate;
	•	amount of interest or principal payments;
	•	whether interest or principal will be payable to holders of the class if specified events occur;
	•	the right to receive collections from designated portions of the contracts owned by the trust;
	•	scheduled final payment date; and
	•	the ability of holders of a class of notes to direct the indenture trustee or the trustee to take specified remedies.
Trust Assets	The property of each trust will primarily be a pool of contracts secured by new and used motorcycles and amounts due or collected under the contracts after a cutoff date specified in your prospectus supplement and will include related assets including:
	•	security interests in the financed motorcycles;
	•	proceeds from claims on insurance policies and debt cancellation agreements covering the financed motorcycles or the obligors;
	•	certain rebates of premiums and other amounts relating to insurance policies and other items financed under the contracts;
	•	the rights of the depositor in the agreements identified in your prospectus supplement;
	•	amounts deposited in bank accounts specified in your prospectus supplement; and
	•	proceeds from liquidated assets, including repossessed motorcycles.
	With respect to contracts from Canadian obligors that may from time to time be included, a trust may hold its interest in such contracts either directly or indirectly through one or more notes, certificates, participations or other interests issued to the trust by a Canadian special purpose entity and secured by such contracts.

The Contracts	The contracts will be conditional sales contracts or promissory note and security agreements originated directly by the seller or purchased by the seller from the originators or other entities that finance the retail purchase of new and used motorcycles.
	Your prospectus supplement provides information about:
	•	the initial aggregate principal balance of the contracts transferred to the trust;
	•	the number of contracts;
	•	the average contract principal balance;
	•	the geographical distribution of the contracts;
	•	the distribution of the contracts by contract interest rate;
	•	the remaining term of the contracts;
	•	the weighted average remaining term of the contracts; and
	•	the weighted average contract interest rate on the contracts.
Mandatory Purchase or Replacement of a Contract	The depositor will make representations and warranties regarding the contracts when it transfers the contracts to the trust, and the seller will make representations and warranties regarding the contracts when it sells the contracts to the depositor. In the event of an uncured breach of any of these representations and warranties that materially and adversely affects the trust's or securityholders' interest in a contract or the collectibility of a contract, the depositor will be obligated to repurchase that contract from the trust and the seller will be obligated to repurchase that contract from the depositor. See "Description of the Transfer and Servicing Agreements—Representations and Warranties Made by the Seller and the Depositor" in this prospectus.
Credit and Cash Flow Enhancement	The depositor may arrange for protection from losses to one or more classes of the securities. Credit enhancement may include:
	•	a cash collateral account;
	•	a spread account;
	•	subordination of one or more other classes of securities;
	•	one or more reserve funds;
	•	over-collateralization;
	•	letters of credit or other credit or liquidity facilities;
	•	surety bonds;
	•	guaranteed investment contracts;
	•	repurchase obligations;
	•	yield supplement agreements;

	•	cash deposits;
	•	swap or other interest rate protection agreements;
	•	third party payments or other support; or
	•	other arrangements which may become suitable in light of credit enhancement practices or developments in the future.
	In addition, the depositor may develop and include in a trust features designed to ensure the timely payment of amounts owed to you. These cash flow enhancement features may include any one or more of the following:
	•	yield supplement agreements;
	•	liquidity facilities;
	•	cash deposits;
	•	third party payments or other support; or
	•	other arrangements which may become suitable in light of cash flow enhancement practices or developments in the future.
	Your prospectus supplement will describe the specific terms of any credit or cash flow enhancement applicable to your securities.
Servicing; Servicing Fee	The servicer will be responsible for servicing, managing and administering the contracts and financed motorcycles, and maintaining custody of, enforcing and making collections on the contracts.
	The trust will pay the servicer a monthly fee equal to a percentage of the principal balance of the contracts as of the beginning of each month. The fee will be payable out of amounts received on the contracts.
	The servicer will also receive additional servicing compensation in the form of investment earnings on certain bank accounts of the trust (to the extent expressly provided therefor) and late fees, prepayment fees and other administrative fees and expenses or similar charges received by the servicer during that month in respect of the contracts. See "Description of the Transfer and Servicing Agreements—Servicing—Servicing Compensation and Payment of Expenses" in this prospectus.
Advances	The servicer may be obligated to advance interest that is due but unpaid by an obligor. The servicer will not be obligated to make an advance if it determines that it will not be able to recover that advance from an obligor. The trust will reimburse the servicer for the advances the servicer has made from late collections on the contracts for which it has made advances or from collections generally if the servicer determines that an advance will not be recoverable from an obligor.

	Your prospectus supplement will describe the nature of the servicer's obligation to make advances to the trust and the reimbursement of those advances.
	You should refer to "Description of the Transfer and Servicing Agreements—Servicing—Advances" in this prospectus for more detailed information on advances and reimbursement of advances.
Optional Purchase of Contracts	Once the aggregate outstanding principal balance of the contracts is less than 10% of the sum of (i) the aggregate outstanding principal balance of the contracts as of the initial cutoff date and (ii) the initial amount on deposit in the prefunding account, if any, the servicer, at its option, may purchase all of the contracts held by the trust. Upon such a purchase, the securities of that trust will be prepaid in full. See "Description of the Notes and Indenture—Optional Purchase of Contracts and Redemption of Notes" in this prospectus.
Material Federal Income Tax Consequences:	Winston & Strawn LLP, as special tax counsel to the trust, will deliver an opinion that:
	•	the notes will be characterized as debt for federal income tax purposes; and
	•	the trust will not be characterized as an "association" or "publicly traded partnership" taxable as a corporation; and
	By purchasing a note, you agree to treat your note as debt for federal, state and local income tax purposes.
ERISA:
ERISA Considerations	Subject to the considerations described in "ERISA Considerations" in this prospectus and your prospectus supplement, employee benefit plans that are subject to the Employee Retirement Income Security Act of 1974, as amended, may purchase notes issued by an "owner trust".
	You should refer to "ERISA Considerations" in this prospectus and your prospectus supplement for more detailed information regarding the ERISA eligibility of any class of securities.

Risk Factors

The following risk factors and the risk factors in your prospectus supplement describe the principal risk factors relating to an investment in the securities. You should carefully consider the following risk factors and the additional risk factors described in the section captioned "Risk Factors" in your prospectus supplement before you invest in any class of securities.

You must rely on the trust's assets for repayment which may not be sufficient to make full payments on your securities

The securities represent interests solely in the trust or indebtedness of the trust and will not be insured or guaranteed by the originators, the seller, the servicer, the depositor, or any of their respective affiliates, or the related trustee or any other person or entity. The only source of payment for your securities is payments received on the contracts held by the trust and credit enhancement, if any, for your securities. The amount of credit enhancement available to cover shortfalls in distributions of interest on and principal of your securities may be limited. If the credit enhancement is exhausted, the sole source of payment for your securities will be from payments on the contracts.

The trust has limited recourse against the seller and the depositor

None of the seller, the depositor or any of their affiliates is generally obligated to make any payments in respect of any notes or the contracts of the trust. However, in connection with the sale of contracts by the depositor to the trust, the depositor will make representations and warranties with respect to the characteristics of such contracts and, in certain circumstances, the depositor may be required to repurchase contracts with respect to which such representations and warranties have been breached. The seller will correspondingly be obligated to the depositor under the transfer and sale agreement (which rights of the depositor against the seller will be assigned to the trust) to repurchase the contracts from the depositor contemporaneously with the depositor's repurchase of the contracts from the trust. There can be no assurance that the depositor or the seller will be able to repurchase a contract at the time when it is asked to do so. See "Description of the Transfer and Servicing Agreements—Sale and Assignment of Contracts by Seller" and "Description of the Transfer and Servicing Agreements—Representations and Warranties made by the Seller and the Depositor."

You may experience reduced returns on your investment due to prepayments on the contracts, repurchases of the contracts, liquidations of defaulted contracts and early termination of the trust

A higher than anticipated level of prepayments of the contracts or liquidations of defaulted contracts may cause a trust to pay principal on your securities sooner than you expected. Also, a trust may pay principal on your securities sooner than you expected if the depositor or the servicer repurchases contracts from the trust. You may not be able to reinvest the principal paid to you at yields that are equivalent to the yields on your securities; therefore, the ultimate return you receive on your investment in the securities may be less than the return you expected on the securities.

The contracts included in the trust may be prepaid, in full or in part, voluntarily or as a result of defaults, theft of or damage to the related motorcycles or for other reasons. The depositor will be required to repurchase a contract from the trust if a breach of its representations and warranties relating to that contract materially and adversely affects the trust's or the securityholders' interest in the contract or the collectibility of the contract. In that event, the seller will be obligated to repurchase the contract from the depositor. Under agreements with certain motorcycle dealers the seller may have full or partial recourse against the motorcycle dealer for such repurchased contract. This recourse to the dealers will be assigned by the seller to the depositor pursuant to the transfer and sale agreement, assigned from the depositor to the trust pursuant to the sale and servicing agreement and pledged by the trust to the indenture trustee pursuant to the indenture. There can be no assurance that a motorcycle dealer will perform its obligations under such motorcycle dealer agreement if and when

required to do so. In addition, the seller will be required to purchase contracts from the trust if it breaches certain covenants with respect to those contracts. The servicer may purchase all remaining contracts from the trust when the aggregate outstanding principal balance of the contracts is less than 10% of the sum of (i) the aggregate outstanding principal balance of the contracts as of the initial cutoff date and (ii) the initial amount on deposit in the pre-funding account, if any.

The depositor cannot fully predict the extent to which prepayments on the contracts by the related obligors will shorten the life of the securities. The rate of prepayments on the contracts may be influenced by a variety of economic, social and other factors including:

•: changes in customer requirements;
•: the level of interest rates;
•: the level of casualty losses; and
•: the overall economic environment.

The depositor cannot assure you that prepayments on the contracts held by the trust will conform to any historical experience. The depositor cannot predict the actual rates of prepayments which will be experienced on the contracts. However, your prospectus supplement may present information as to the principal balances of the securities remaining on each payment date under several hypothetical prepayment rates. You will bear all reinvestment risk resulting from prepayments on the contracts and the corresponding acceleration of payments on the securities. See "Weighted Average Lives of the Securities" in this prospectus.

Certain events of default under the indenture may result in insufficient funds to make payments on your securities

If the trust fails to pay principal of any class of notes on its final scheduled payment date, or fails to pay interest on any class of notes within five days of its due date, the indenture trustee or the holders of more than 50% of the notes or the class or the classes of notes described in your prospectus supplement may declare the entire amount of the notes to be due immediately. If this happens, the holders of more than 50% (or such higher percentage as specified in your prospectus supplement) of the notes or the class or classes of notes described in your prospectus supplement may direct the indenture trustee to sell the contracts and prepay the notes. In such event, there may not be sufficient funds to pay all of the classes of securities in full.

Paid-ahead simple interest contracts may affect the weighted average life of the securities

If an obligor on a simple interest contract makes a payment on the contract ahead of schedule, the weighted average life of the securities could be affected. This is because the additional scheduled payments will be treated as a principal prepayment and applied to reduce the principal balance of the related contract. Obligors are generally not required to make any scheduled payments during the period for which the contract was paid-ahead. During this period, interest will continue to accrue on the contract principal balance, but the contract would not be considered delinquent. Furthermore, when an obligor resumes the required payments, they may be insufficient to cover the interest that has accrued since the last payment by that obligor.

Generally paid-ahead payments shorten the weighted average lives of the securities when the paid-ahead amount is applied to the payment of principal on the securities; however, in certain circumstances the weighted average lives of the securities may be extended. In addition, liquidation proceeds will be applied first to reimburse any advances made by the servicer. Therefore, to the extent the servicer makes advances on a paid-ahead simple interest contract which subsequently goes into default, the loss on this contract may be larger than would have been the case had advances not been made.

The seller's portfolio of contracts has historically included simple interest contracts which have been paid-ahead by one or more scheduled monthly payments. We cannot predict the number of contracts which may become paid-ahead simple interest contracts or the amount of scheduled payments which may be paid ahead.

The price at which you can resell your securities may decrease if the ratings of your securities decline

At the initial issuance of the securities, at least one nationally recognized statistical rating organization will rate the offered securities in one of the four highest rating categories. A security rating is not a recommendation to buy, sell or hold securities. A rating will reflect the rating agency's assessment of the likelihood that the holders of the securities will receive the payment of interest on the securities on each payment date and the payment of principal on the final scheduled payment date. Similar ratings on different types of securities do not necessarily mean the same thing. You should analyze the significance of each rating independently from any other rating. At any time, a rating agency may lower its ratings of the securities or withdraw its ratings entirely. If a rating assigned to any security is lowered or withdrawn for any reason, you may not be able to resell your securities or you may be able to resell them only at a substantial discount. For more detailed information regarding the ratings assigned to the securities, see "Ratings of the Securities" in this prospectus and in your prospectus supplement.

The rating of a swap counterparty may affect the ratings of the securities

If a trust enters into a swap agreement, the rating agencies that rate the trust's securities will consider the provisions of the swap agreement and the rating of the swap counterparty. If a rating agency downgrades the debt rating of the swap counterparty, it may downgrade the rating of the securities. In such an event, you may not be able to resell your securities or you may be able to resell them only at a substantial discount.

The ratings on your securities may be lowered or withdrawn

It is a condition to the issuance of the securities that they be rated in one of the four highest rating categories by at least one nationally recognized statistical rating organization. A rating is not a recommendation to purchase, hold or sell securities inasmuch as such rating does not comment as to market price or suitability for a particular investor. Ratings of securities will address the likelihood of the payment of principal and interest thereon pursuant to their terms. The ratings of securities will not address the likelihood of an early return of invested principal. There can be no assurance that a rating will remain for a given period of time or that a rating will not be lowered or withdrawn entirely by a rating agency if in its judgment circumstances in the future so warrant. For more detailed information regarding the ratings assigned to any class of a particular series of securities, see "Ratings of the Notes" in your prospectus supplement.

Subordination of some classes of securities may cause such classes of securities to bear additional credit risk and does not ensure payment of the more senior classes of securities

The trust may pay interest and principal on some classes of securities prior to paying interest and principal on other classes of securities. The subordination of some classes of securities to others means that the subordinated classes of securities are more likely to suffer the consequences of delinquent payments and defaults on the contracts than the more senior classes of securities.

The senior classes of securities could lose the credit enhancement provided by the subordinated classes of securities if delinquencies and defaults on the contracts increase and if the collections on the contracts and any credit enhancement described in your prospectus supplement are insufficient to pay the senior classes of securities.

Your prospectus supplement will describe any subordination provisions applicable to your securities.

Future delinquency and loss experience of the contracts may vary substantially from the servicer's historical experience

In your prospectus supplement, we will present the historical delinquency and loss experience of the portfolio of contracts originated indirectly or purchased by the seller and serviced by the servicer consisting primarily of contracts secured by motorcycles sold in the United States (including U.S. Territories) manufactured by Harley-Davidson, Buell and other manufacturers. However, the actual delinquency and loss experience for the contracts transferred to a trust could be substantially worse. If so, you may not receive interest and principal payments on your securities in the amounts and at the times you expect.

Interests of other persons in the contracts or the financed motorcycles could reduce the funds available to make payments on your securities

A person could acquire an interest in a contract that is superior to that of the trust because the servicer will retain possession of the contracts and the contracts will not be marked or stamped to indicate that they have been sold to the trust. If a person purchases contracts, or takes a security interest therein, for value in the ordinary course of its business and obtains possession of the contracts without actual knowledge of the trust's interest, that person will acquire an interest in the contracts superior to the interest of the trust and some or all of the collections on the contracts may not be available to make payments on the securities.

A person could also acquire an interest in a financed motorcycle that is superior to that of the trust because of the failure to identify the trust as the secured party on the related certificate of title. The seller will assign its security interests in the financed motorcycles to the depositor, and the depositor will assign its security interests in the financed motorcycles to the trust. The seller's assignment to the depositor and the depositor's subsequent assignment to the trust are subject to state vehicle registration laws. These registration laws require that the secured party's name appear on the certificate or similar registration of title in order for the secured party's security interest to be perfected. To facilitate servicing and reduce administrative costs, the servicer will continue to hold the certificates of title or ownership for the motorcycles and will not endorse or otherwise amend the certificates of title or ownership to identify the trust as the new secured party. As a result, the trust may not have a perfected security interest in the financed motorcycles in certain states because the certificates or similar registrations of title will not be amended to reflect the assignment of the security interests in the financed motorcycles to the trust. In addition, because the trust will not be identified as the secured party on any certificate of title or similar registration of title, the security interest of the trust in the motorcycles may be defeated through fraud, forgery, negligence or error.

In addition, the holders of some types of liens, such as tax liens or mechanics liens, may have priority over the trust's security interest in the financed motorcycles. The trust also may lose its security interest in a financed motorcycle that is confiscated by the government.

In the event that the trust must rely upon repossession and sale of the financed motorcycle securing a defaulted contract to recover amounts due on the defaulted contract, the trust's ability to realize upon the financed motorcycle would be limited by the failure to have a perfected security interest in the financed motorcycle or the existence of a senior security interest in the financed motorcycle. In this event, you may be subject to delays in payment and may incur losses on your investment in the securities as a result of defaults or delinquencies by obligors. See "Legal Aspects of the Contracts—Security Interests" in this prospectus.

Limitations on enforceability of security interests in the financed motorcycles may hinder the trust's ability to realize the value of the financed motorcycles

State law limitations on the enforceability of security interests and the manner in which a secured party may dispose of collateral may limit or delay the trust's ability to obtain or sell the financed motorcycles. This could reduce or delay the availability of funds to make payments on your securities. Under these state law limitations:

•: some jurisdictions require that the obligor be notified of the default and be given a period of time within which it may cure the default prior to or after repossession; and
•: the obligor may have the right to redeem collateral for its obligations prior to actual sale by paying the secured party the unpaid balance of the obligation plus the secured party's expenses for repossessing, holding and preparing the collateral for disposition.

Contracts that fail to comply with consumer protection laws may be unenforceable, which may result in losses on your investment

The contracts are consumer contracts subject to many federal and state consumer protection laws. If any of the contracts do not comply with one or more of these laws, the servicer may be prevented from or delayed in collecting amounts due on the contracts. If that happens, payments on the securities could be delayed or reduced. See "Legal Aspects of the Contracts—Consumer Protection Laws" in this prospectus.

Each of the depositor and seller will make representations and warranties relating to the contracts' compliance with consumer protection laws and the enforceability of the contracts. If those representations and warranties are not true as to any contract and the breach materially and adversely affects the trust's or the securityholders' interest in the contract or the collectibility of the contract, the depositor will be obligated to repurchase the contract from the trust and the seller will be required to repurchase the contract from the depositor.

Repurchase obligations of the depositor and the seller provide you only limited protection against prior liens on the contracts

Federal or state law may grant liens on the contracts that have priority over the trust's interest. If the creditor associated with any prior lien on a contract exercises its remedies, the cash proceeds from the contract and related financed motorcycle available to the trust will be reduced. In that event, there may be a delay or reduction in payments to you. An example of a lien arising under federal or state law is a tax lien on property of the seller or depositor arising prior to the time a contract is conveyed to the trust. Such a tax lien would have priority over the interest of the trust in the contracts.

The seller will represent and warrant to the depositor, and the depositor will represent and warrant to the trust, that there are no prior liens on the contracts. In addition, the seller will represent and warrant to the depositor, and the depositor will represent and warrant to the trust, that it will not grant any lien on the contracts. If those representations and warranties are not true as to any contract and the breach materially and adversely affects the trust's or the securityholders' interest in the contract or the collectibility of the contract, the depositor will be obligated to repurchase the contract from the trust and the seller will be required to repurchase the contract from the depositor. There can be no assurance that the depositor or the seller will be able to repurchase a contract at the time when it is asked to do so.

Contracts with Canadian obligors have additional risks which may reduce the amounts available to make payments on your securities

Certain of the contracts included in the trust may have been originated in Canada by Harley-Davidson motorcycle dealers or one or more affiliates of the seller. Canada may impose a 10% non-resident withholding tax on the gross amount of any interest payments paid or credited by Canadian obligors to the seller, the depositor and the trust, as assignees, each as residents of the United States for the purposes of the Canada-United States Income Tax Convention. As a result, the interest payments actually received by the seller, and the trust as the assignee, from Canadian obligors may be reduced by the amount of the withholding tax. Therefore, the effective interest rate on contracts that were originated in Canada may be lower than the stated interest rate on such contracts.

In addition, payments under the Canadian contracts are made in Canadian dollars. Since the trust will make payments on the securities in U.S. dollars and receive payments on the Canadian contracts in Canadian dollars, the trust may be exposed to changes in currency exchange rates. If the trust enters into a currency swap to protect against this risk, its ability to protect itself from shortfalls in cash flow caused by currency changes will depend to a large extent on the terms of the swap agreement and whether the swap counterparty performs its obligations under the swap. If the trust does not receive the payments it expects from the swap counterparty, the trust may not have adequate funds to make all payments to securityholders when due, if ever. A currency swap requires one party to provide a specified amount of a currency to the other party at specified times in exchange for the other party providing a different currency at a predetermined exchange ratio. For example, if the trust issues securities denominated in U.S. dollars, it might enter into a swap agreement with a swap counterparty under which the trust would use the collections on the receivables to pay Canadian dollars to the swap counterparty in exchange for receiving U.S. dollars at a predetermined exchange rate to make the payments owed on the securities. The terms of any swap agreement will be described in more detail in your prospectus supplement.

Canadian provincial law limitations on the enforceability of security interests and the manner in which a secured party may dispose of collateral may limit or delay the trust's ability to enforce its security interest and dispose of the motorcycles financed under Canadian contracts. This could reduce or delay the availability of funds to make payments on your securities. Under these Canadian law limitations, most provinces require that the obligor and certain other persons with an interest in the collateral be notified of the disposition of the collateral and be given a period of time within which they may satisfy the obligation secured by the collateral prior to actual sale of the collateral by paying the secured party the unpaid balance of the obligation plus the secured party's expenses for repossessing, holding and preparing the collateral for disposition.

Those contracts which are originated in Canada are consumer contracts subject to many Canadian federal and provincial consumer protection laws which impose requirements on the making and enforcement of consumer credit sales and the granting of consumer credit generally. If any of the contracts do not comply with one or more of these laws, the servicer may be prevented from or delayed in collecting amounts due on the contracts. If that happens, payments on the securities could be delayed or reduced. See "Legal Aspects of the Contracts—Consumer Protection Laws" in this prospectus.

Bankruptcy of one or more obligors may reduce or delay collections on the contracts, and the sale of financed motorcycles relating to defaulting obligors may be delayed or may not result in complete recovery of amounts due

Bankruptcy and insolvency laws may increase the risk of loss on the contracts of obligors who become subject to bankruptcy proceedings. Those laws could result in the write-off of contracts of bankrupt obligors or result in delay in payments due on the contracts. For example, if the obligor becomes bankrupt or insolvent, the trust may need the permission of a bankruptcy court to obtain and

sell its collateral. As a result, you may be subject to delays in receiving payments, and you may also suffer losses if available credit enhancement for losses is insufficient.

If a bankruptcy court determines that the transfer of contracts from Eaglemark Savings Bank or the motorcycle dealers to the seller or from the seller to the depositor was not a true sale, or if a conservator or receiver were appointed for Eaglemark Savings Bank, then payments on the contracts could be delayed resulting in losses or delays in payments on your securities

If a motorcycle dealer or the seller became a debtor in a bankruptcy case, creditors of that party, or that party acting as debtor-in-possession, may assert that the transfer of the contracts was ineffective to remove the contracts from that party's estate. In that case, the distribution of payments on the contracts to the trust might be subject to the automatic stay provisions of the United States Bankruptcy Code. This would delay payments on your securities for an uncertain period of time. Furthermore, reductions in payments under the contracts to the trust may result if the bankruptcy court rules in favor of the creditors or the debtor-in-possession. In either case, you may experience delays or reductions in payments on your securities. In addition, a bankruptcy trustee would have the power to sell the contracts if the proceeds of the sale could satisfy the amount of the debt deemed owed by the motorcycle dealer or the seller, as the case may be. The bankruptcy trustee could also substitute other collateral in lieu of the contracts to secure the debt. Additionally, the bankruptcy court could adjust the debt if the motorcycle dealer or the seller were to file for reorganization under Chapter 11 of the United States Bankruptcy Code. Any of these actions could result in losses or delays in payments on your securities. The motorcycle dealers and the seller will each represent and warrant that its conveyance of the contracts is a valid sale and transfer of the contracts. See "Legal Aspects of the Contracts—Certain Bankruptcy Considerations."

By statute, the FDIC as conservator or receiver is authorized to repudiate any "contracts" of Eaglemark Savings Bank upon payment of "actual direct compensatory damages." This authority may be interpreted by the FDIC to permit it to repudiate the transfer of contracts to the seller. Under an FDIC regulation, however, the FDIC as conservator or receiver will not reclaim, recover or recharacterize a bank's transfer of financial assets if certain conditions are met, including that the transfer qualifies for sale accounting treatment, was made for adequate consideration and was not made fraudulently, in contemplation of insolvency, or with the intent to hinder, delay or defraud the bank or its creditors. We believe the FDIC regulation will apply to the transfer of contracts to the seller and intend on satisfying the conditions of the regulation. If a condition required under the FDIC regulation, or other statutory or regulatory requirement applicable to the transactions, were found not to have been satisfied, the FDIC as conservator or receiver might refuse to recognize Eaglemark Savings Bank's transfer of contracts to the seller. In that case, payments on your securities may be delayed and possibly reduced. Also, the FDIC could require the trust and securityholders to comply with the administrative claims procedure established by the FDIC to establish their rights to payments on the contracts, could request a stay of any actions to enforce the participation agreement against Eaglemark Savings Bank, or could repudiate the participation agreement pursuant to which the seller purchases the contracts from Eaglemark Savings Bank and limit claims of the trust and securityholders to "actual direct compensatory damages." Additionally, the trust could be limited to seeking recovery based upon the obligation of the seller to repurchase contracts for which it did not have good and marketable title. Any of these actions could result in losses or delays in payments on your securities.

If a bankruptcy court decides to consolidate the assets and liabilities of the depositor and the seller, payments on the contracts could be delayed resulting in losses or delays in payments on the securities

If the seller became a debtor in a bankruptcy case, the seller, a creditor or party acting as debtor-in-possession could request a bankruptcy court to order that the seller's assets and liabilities be substantively consolidated with the depositor's assets and liabilities. If the bankruptcy court consolidated the assets and liabilities of the seller and the depositor, delays and possible reductions in

the amounts of payments on your securities could occur. See "Legal Aspects of the Contracts—Certain Bankruptcy Considerations."

Proceeds of the sale of contracts may not be sufficient to pay your securities in full; failure to pay principal on your securities will not constitute an event of default until maturity

If so directed by the holders of the requisite percentage of outstanding notes following an acceleration of the notes upon an event of default, the indenture trustee in certain circumstances will sell the contracts owned by the trust. However, there is no assurance that the market value of those contracts will at any time be equal to or greater than the aggregate outstanding principal balance of the securities. Therefore, upon a sale of the contracts, there can be no assurance that sufficient funds will be available to repay your securities in full. In addition, the amount of principal required to be paid to you on each payment date will generally be limited to amounts available in the collection account and the reserve fund, if any. The failure to pay principal of your securities generally will not result in the occurrence of an event of default until the final scheduled payment date for your securities. See "Description of the Notes and Indenture—The Indenture—Events of Default; Rights Upon Event of Default" in this prospectus.

Commingling of collections could result in reduced payments to you

If permitted by the rating agencies rating the securities, the servicer may hold collections it receives from the obligors on the contracts with its own funds until the day prior to the next date on which distributions will be made on the securities. If the servicer does not pay these amounts to the trust when required to do so, the trust may be unable to make the payments owed on your securities. In the event the servicer becomes a debtor in a bankruptcy case, the trust may not have a perfected security interest in these collections. In either case, you may suffer losses on your investment.

You may not be able to resell your securities

There is currently no secondary market for the securities. We cannot assure you that a secondary market will develop and if it does develop how liquid it will be. Thus, you may not be able to resell your securities at all, or may be able to do so only at a substantial discount. The underwriters may assist in resales of the securities but they are not obligated to do so.

If the trust enters into a currency or an interest rate swap, payments on the securities will be dependent on payments made under the swap agreement

If the trust enters into a swap agreement, its ability to protect itself from shortfalls in cash flow caused by currency or interest rate changes will depend to a large extent on the terms of the swap agreement, whether the swap agreement is legally enforceable and whether the swap counterparty performs its obligations under the swap agreement. If the trust does not receive the payments it expects under the swap agreement, the trust may not have adequate funds to make all payments owed on your securities when due.

You may experience reinvestment risk associated with pre-funding accounts

If so provided in the prospectus supplement, on the closing date an amount will be deposited into the pre-funding account. The amount on deposit in the pre-funding account will be used to purchase subsequent contracts from the depositor (which, concurrently, will acquire such subsequent contracts from the seller) from time to time during the funding period specified in the prospectus supplement. If the principal amount of the eligible subsequent contracts acquired by the seller from the originators during the funding period is less than the amount on deposit in the pre-funding account, there may be amounts remaining on deposit in the pre-funding account after the sale of such subsequent contracts by the seller to the depositor and the concurrent transfer by the depositor to the trust.

Any conveyance of subsequent contracts to a trust is also subject to the satisfaction, on or before the related subsequent transfer date, of the following conditions precedent, among others: (i) each such subsequent contract must satisfy the eligibility criteria specified in the related transfer and sale agreement or sale and servicing agreement, as applicable; (ii) the seller and the depositor shall not have selected such subsequent contracts in a manner that is adverse to the interests of holders of the securities; and (iii) as of the cutoff dates for such subsequent contracts, all of the contracts in the trust, including the subsequent contracts to be conveyed to the trust as of such date, must satisfy the parameters described in the prospectus supplement.

To the extent that the amount on deposit in the pre-funding account has not been applied to the purchase of subsequent contracts by the end of the funding period, any amounts remaining in the pre-funding account will be distributed as a prepayment of principal to you in the amounts and pursuant to the priorities set forth in your prospectus supplement. To the extent you receive such a prepayment of principal, there may not then exist a comparably favorable reinvestment opportunity and you will bear all reinvestment risk resulting from such prepayments.

The trust does not have significant assets or sources of funds other than the contracts

The trust does not have, and will not be permitted or expected to have, any significant assets or sources of funds other than the contracts and, to the extent provided in your prospectus supplement, a pre-funding account, a reserve fund and any other credit enhancement or trust property. The notes will represent obligations solely of the trust, and the notes will not be insured or guaranteed by the depositor, the servicer, the trustee, the indenture trustee or any other person or entity (except as may be described in your prospectus supplement). Consequently, the only source of payment for your securities will be payments on the contracts and, if and to the extent available, amounts on deposit in the pre-funding account (if any), the reserve fund (if any) and any other credit enhancement, all as specified in your prospectus supplement. Any such credit enhancement will not cover all contingencies, and losses in excess of amounts available pursuant to any credit enhancement will be borne directly by you.

Social, economic and other factors may affect the performance of the contracts and the availability of subsequent contracts

Economic conditions in countries, states or U.S. territories where obligors reside may affect the delinquency, loan loss and repossession experience of the trust with respect to the contracts. The performance by such obligors, or the ability of the seller to acquire from the originators sufficient subsequent contracts for purchase with the amount on deposit in the pre-funding account (if any), may be affected by a variety of social and economic factors including, but not limited to, interest rates, unemployment levels, the rate of inflation, and consumer perception of economic conditions generally. However, neither the seller nor the depositor is able to determine or predict whether or to what extent economic or social factors will affect the performance by any obligors or the availability of subsequent contracts in cases where subsequent contracts are to be transferred to the trust as specified in the prospectus supplement.

The holders of the notes or the class or classes of notes described in your prospectus supplement may remove the servicer without the consent of the holders of the other classes of notes

To the extent specified in your prospectus supplement, if there is a servicer default under the sale and servicing agreement, the indenture trustee or the holders of either the notes or the class or classes of notes described in your prospectus supplement may remove the servicer without the consent of the indenture trustee or the holders of the other classes of notes. The trustee will not have the ability, without the concurrence of the holders of the notes or certain classes of notes, to remove the servicer if a servicer default occurs.

Harley-Davidson Motorcycles

The motorcycles securing the contracts were manufactured by one or more subsidiaries of Harley-Davidson, Inc. ("Harley-Davidson"); provided that up to 12.0% of the contracts (including all subsequent contracts) may relate to, and be secured by, motorcycles manufactured by other manufacturers as described below. Not more than 10.0% of the contracts (including all subsequent contracts) will be secured by motorcycles manufactured by Buell Motorcycle Company, LLC, a wholly-owned subsidiary of Harley-Davidson ("Buell").

Harley-Davidson produces and sells premium heavyweight motorcycles. Harley-Davidson branded motorcycle products emphasize traditional styling, design simplicity, durability and quality. Harley-Davidson manufactures five families of Harley-Davidson branded motorcycles: Sportster®, Dyna™, Softail®, Touring and VRSC. These motorcycles are powered by one of four air-cooled, twin-cylinder engines with a 45-degree "V" configuration, or in the case of the VRSC family, a liquid-cooled, twin-cylinder engine with a 60-degree "V" configuration. Harley-Davidson's engines range in size from 883cc's to 1690cc's.

Buell motorcycle products emphasize innovative design, responsive handling and overall performance. Buell currently manufactures and sells six models, including five heavyweight models in its XB family, and the Blast®. The Buell XB motorcycles focus on superior handling and are powered by either a 984cc (XB9) or a 1203cc (XB12) air-cooled, twin-cylinder engine with a 45-degree "V" configuration. The Buell Blast is smaller and less expensive than the Buell XB models and is powered by a 492cc single-cylinder engine.

The motorcycle market is comprised of four segments: standard, which emphasizes simplicity and cost; performance, which emphasizes handling and acceleration; touring, which emphasizes comfort and amenities for long-distance travel; and custom, which emphasizes styling and individual owner customization. The touring segment of the heavyweight market was pioneered by Harley-Davidson and includes motorcycles equipped for long-distance touring with fairings, windshields, saddlebags and Tour Pak® luggage carriers. The custom segment of the market includes motorcycles featuring the distinctive styling associated with classic Harley-Davidson motorcycles. The standard and performance segments of the market are served primarily by the Harley-Davidson's Buell motorcycle line.

Other Manufacturers

Except as otherwise specified in your prospectus supplement, contracts aggregating not more than 12.0% of the aggregate principal balances of all contracts in a trust (including subsequent contracts) may relate to, and be secured by, motorcycles manufactured by Honda, Yamaha, Suzuki, Kawasaki and BMW as well as certain other manufacturers.

The Seller and Servicer

General

The seller and servicer is Harley-Davidson Credit Corp. ("HDCC"), a Nevada corporation and wholly-owned subsidiary of Harley-Davidson Financial Services, Inc. ("HDFS"). HDFS is a wholly-owned subsidiary and the financing division of Harley-Davidson. HDCC began operations in January 1993 when it purchased the $85 million wholesale financing portfolio of certain Harley-Davidson dealers from ITT Commercial Finance; subsequently, HDCC entered the retail consumer finance business. HDCC provides wholesale and retail financial services programs to Harley-Davidson and Buell dealers and consumers in the United States and Canada.

Wholesale financial services include floorplan and open account financing for motorcycles and motorcycle parts and accessories, real estate loans, computer loans and showroom remodeling loans. Retail financial services include installment lending for new and used Harley-Davidson and Buell

motorcycles and motorcycles manufactured by other manufacturers. Insurance services, including property and casualty insurance, extended service contracts and certain other insurance products to motorcycle consumers and dealers, are provided by Harley-Davidson Insurance Services, Inc., a commission-based independent representative for various insurance companies and wholly-owned subsidiary of HDFS.

HDCC's financing and insurance programs are designed to work together as a package that appeals to the needs of Harley-Davidson's customers. The intent of such a package is to increase dealer and customer loyalty to Harley-Davidson while improving revenue and profits over time. HDCC's principal executive offices are located at 3850 Arrowhead Drive, Carson City, Nevada 89706 (telephone 775/886-3000). As of December 31, 2004, HDCC had total assets of $2,094.4 million, and stockholder's equity of $746.7 million.

HDCC began its asset-backed securities program in 1994, and, to date, has securitized only contracts relating to the sale of new and used motorcycles manufactured by Harley-Davidson or Buell or certain other manufacturers. Since the inception of its program through the end of 2004, HDCC has securitized over $8.4 billion of motorcycle contracts.

The Contracts

Underwriting and Origination

The contracts in a trust have been or will be purchased by the seller from (i) Eaglemark Savings Bank and/or (ii) a network of Harley-Davidson dealers located throughout the United States (including U.S. Territories) and, in certain instances, Canada. Eaglemark Savings Bank underwrites and approves each customer's credit application and purchase order in accordance with the guidelines established by the seller. Eaglemark Savings Bank's personnel contact dealers and explain Eaglemark Savings Bank's available financing plans, terms, prevailing rates and credit and financing policies. If the dealer wishes to use Eaglemark Savings Bank's available customer financing, the dealer must submit an application to Eaglemark Savings Bank for approval.

Contracts that the seller purchases from the originators are written on forms provided or approved by the seller and are purchased on an individually approved basis in accordance with the seller's guidelines. In most cases, the dealer submits the customer's credit application and purchase order to Eaglemark Savings Bank's office where an analysis of the creditworthiness of the proposed buyer is made. The analysis includes a review of the proposed buyer's paying habits, collateral information, length and likelihood of continued employment and certain other procedures. With respect to contracts for new and used Harley-Davidson or Buell motorcycles, Eaglemark Savings Bank generally finances up to 90% of the motorcycle's sales price, and may finance up to 100% of the motorcycle's sales price for its most creditworthy customers and/or during special marketing promotions. With respect to contracts for new and used motorcycles not manufactured by Harley-Davidson or Buell, Eaglemark Savings Bank generally finances up to 90% of the motorcycle's sales price. Eaglemark Savings Bank will also finance, as part of the principal balance of a contract, certain dealer installed accessories, sales tax and title fees as well as premiums for the term of the contract on optional credit life and accident and health insurance, debt cancellation agreements, premiums for extended warranty insurance, premiums for GAP insurance and premiums for required physical damage insurance on the motorcycle. If the application meets Eaglemark Savings Bank's guidelines, the credit is approved. In certain cases, the dealer submits the customer's credit application and purchase order directly to the seller where the seller reviews and approves the customer's credit application in accordance with guidelines substantially similar to the guidelines used by Eaglemark Savings Bank.

Collection Procedures

The servicer will make reasonable efforts to collect all payments due with respect to the contracts held by a trust and will, consistent with the related sale and servicing agreement, follow such collection procedures as it follows with respect to comparable motorcycle conditional sales contracts and promissory note and security agreements it services for itself or others.

The servicer's collection efforts include having personnel, using a predictive dialer, call a delinquent obligor on a pre-determined basis every third day in the event such obligor is eleven to twenty-nine days delinquent (with the exception of first payment defaults and loans classified as "Delta accounts" which are called beginning on the second day of delinquency). At thirty days delinquent, the account is assigned from the predictive dialer team to a queue collection team. The account is called at a minimum every three days until the 90th day of delinquency, when contact is attempted daily. Between 30 and 90 days delinquent, each account may be contacted more frequently than every three days depending upon the payment history of the obligor, and the probability of default as assessed by the queue collection team(s) and collection management personnel. The servicer's general approach is to attempt to establish a repayment plan with the obligor of a delinquent contract as opposed to repossessing the related motorcycle; however, the servicer's approach with respect to a specific obligor is affected by the obligor's responsiveness and attitude. Consistent with this approach, the servicer may, in its discretion, arrange with the obligor on a contract to extend or modify the payment schedule, but no such arrangement will, for purposes of any sale and servicing agreement, modify the original due dates or the amount of the scheduled payments or extend the final payment date of any contract beyond six months past the last day of the due period relating to the latest maturity date (as specified with respect to the pool of contracts in your prospectus supplement). The servicer may sell the motorcycle securing the respective contract at public or private sale, or take any other action permitted by applicable law. See "Legal Aspects of the Contracts" in this prospectus.

Criteria for Selecting the Contracts

The contracts will be selected from the seller's portfolio for inclusion in a pool of contracts using several criteria. The selection criteria require that each contract:

•: is secured by a new or used motorcycle; and
•: satisfies any other criteria set forth in the prospectus supplement.

No selection procedures that the seller believes to be adverse to the securityholders will be used in selecting the contracts. All terms of the conditional sales contracts or promissory note and security agreements constituting the contracts that are material to you are described in this prospectus and in your prospectus supplement.

Individual Motorcycle Insurance

In general, the terms of each contract require that for the term of the contract, the motorcycle securing such contract is to be covered by physical damage insurance naming Eaglemark Savings Bank or seller (and their respective successors and assigns) as an additional insured and loss payee; however, in accordance with Eaglemark Savings Bank's and the seller's normal policies, certain small balance contracts may not require verification of such insurance coverage. In the transfer and sale agreement, the seller will represent and warrant that the related obligor had obtained or agreed to obtain physical damage insurance covering the motorcycle. However, the servicer performs no subsequent verification of continued insurance coverage and the seller will not be obligated to make payments to a trust for any loss as to which third party insurance has not been maintained.

The Depositor

General

The depositor is Harley-Davidson Customer Funding Corp., a Nevada corporation and wholly-owned special-purpose finance subsidiary of HDCC. All of the officers and directors of the depositor are also employed by HDCC or HDFS, except that at least two directors of the depositor will at all times be independent of HDCC, HDFS and Harley-Davidson. The depositor's business is limited to, among other things, (i) purchasing the contracts and related property (and other similar retail motorcycle installment conditional sales contracts and similar promissory note and security agreements) from the seller, (ii) acting as the beneficial owner of the trust and other similar trusts and (iii) performing its obligations under the transfer and servicing agreements to which it is a party (as well as similar agreements entered into in connection with the formation of similar trusts).

The Trusts

The depositor will establish a separate trust for each offering of securities. The depositor will establish each trust pursuant to a trust agreement for the transactions described in this prospectus. Each trust will be a statutory trust or a common law trust. Each trust may issue one or more classes of securities, representing debt of or beneficial ownership interests in the trust.

On or before the date of the initial issuance of any securities by a trust, unless otherwise provided for in your prospectus supplement, the seller will sell the pool of contracts and the related property to the depositor pursuant to a transfer and sale agreement and the depositor will transfer the pool of contracts and the related property to the trust in exchange for the proceeds of the securities issued by the trust pursuant to a sale and servicing agreement.

To the extent provided in your prospectus supplement, the depositor may convey additional contracts to the trust after the closing date as frequently as daily during the pre-funding period specified in your prospectus supplement. The trust will purchase any contracts subsequently added to the trust with amounts on deposit in a pre-funding account. Any subsequent contracts will be required to conform to the requirements described in your prospectus supplement. Any subsequent contracts will also be assets of the trust. Any funds remaining on deposit in a pre-funding account at the end of the pre-funding period will be used to prepay principal on the securities as specified in your prospectus supplement.

To the extent provided in your prospectus supplement, all or a portion of the principal collected on the contracts may be applied by the trustee to the acquisition of subsequent contracts during a period specified in your prospectus supplement rather than used to make or distribute payments of principal to securityholders during that period. These securities would have an interest-only period, also commonly referred to as a "revolving period", which would be followed by an "amortization period", during which principal will be paid. Any interest-only or revolving period may terminate prior to the end of the specified period and result in the earlier-than-expected principal repayment of the securities.

The property of a trust, as further specified in your prospectus supplement, will consist of:

•: the contracts and the right to receive all scheduled payments and prepayments received on the contracts after the applicable cutoff date, but excluding any scheduled payments due on or after, but received on or prior to, the applicable cutoff date;
•: amounts that may be held in separate trust accounts maintained by the trustee or the indenture trustee for the trust, including any reserve fund or interest reserve account;
•: security interests in the financed motorcycles securing the contracts and any related property;
•: rights with respect to any repossessed financed motorcycles;

•: the rights to proceeds from claims on physical damage, or other insurance policies and debt cancellation agreements covering the financed motorcycles or the obligors;
•: the depositor's rights against the seller under the transfer and sale agreement pursuant to which the seller sold the pool of contracts to the depositor;
•: the right to receive payments from the depositor in the event the depositor (and concurrently the seller) is obligated to repurchase contracts which do not meet specified representations made by depositor in the sale and servicing agreement or the seller in the transfer and sale agreement;
•: the trust's rights against the servicer under the sale and servicing agreement;
•: credit or cash flow enhancement for the securities specified in the prospectus supplement; and
•: all proceeds of the foregoing.

To the extent provided in your prospectus supplement, with respect to contracts from Canadian obligors, property of a trust may include one or more notes, certificates, participations or other interests issued to the trust by a Canadian special purpose entity and secured by such Canadian contracts. The property of a trust may also include a derivative arrangement for any series or any class of securities. A derivative arrangement may include a guaranteed rate agreement, a maturity liquidity facility, a tax protection agreement, an interest rate cap or floor agreement, an interest rate or currency swap agreement or any other similar arrangement. If the property of the trust includes any of these types of assets, additional information concerning them will be provided to you in your prospectus supplement.

If the trust issues notes, the trust will pledge its assets to the indenture trustee for the benefit of the noteholders to secure its obligations under the notes.

No trust will engage in any business activity other than:

•: issuing notes and/or ownership interests in the trust;
•: purchasing contracts, security interests in the related financed motorcycles and related property;
•: holding and dealing with assets of the trust;
•: making payments on the securities it issued;
•: entering into and performing the duties, responsibilities and functions required under the sale and servicing agreement, the indenture and related documents; and
•: matters incidental to the foregoing.

The assets of a trust will be separate from the assets of all other trusts created by the depositor. Accordingly, the assets of one trust will not be available to make payments on the securities issued by any other trust.

Use of Proceeds

Unless otherwise provided in your prospectus supplement, the trust will use the net proceeds received from the sale of the securities (i) to purchase the initial contracts and related assets from the depositor, and (ii) to make a deposit into the pre-funding account, if any. The seller will use the net proceeds from the depositor's purchase of the initial contracts, as well as subsequent contracts, for general corporate purposes.

The Trustee and the Indenture Trustee

Your prospectus supplement will specify the trustee for each trust and the indenture trustee under the indenture. The trustee's or the indenture trustee's liability in connection with the issuance and sale of the securities is limited solely to the express obligations set forth in the related trust agreement, sale and servicing agreement or indenture. The trustee of a trust may resign at any time, in which event, the administrator, on the trust's behalf, will be obligated to appoint a successor. The indenture trustee under an indenture may resign at any time, in which event, the trust or the administrator, on the trust's behalf, will be obligated to appoint a successor. A trustee that becomes insolvent or otherwise ceases to be eligible to continue in that capacity under the related trust agreement may be removed by the administrator. An indenture trustee that becomes insolvent or otherwise ceases to be eligible to continue in its capacity under the indenture may be removed by the trust or the administrator, on the trust's behalf. In those circumstances, the servicer or the administrator, as the case may be, will be obligated to appoint a successor. Any resignation or removal of a trustee or indenture trustee will not become effective until acceptance of the appointment of a successor trustee.

In addition, the holders of more than 50% of the aggregate principal amount of the notes or the class or classes of the notes described in your prospectus supplement may remove the indenture trustee without cause and may appoint a successor indenture trustee. If a trust issues a class of notes that is subordinated to one or more other classes of notes and an event of default occurs under the indenture, the indenture trustee may be deemed to have a conflict of interest under the Trust Indenture Act of 1939 and may be required to resign as indenture trustee for one or more of the classes of notes. In any such case, the indenture will provide for a successor indenture trustee to be appointed for those classes of notes.

Each of the trustee and the indenture trustee and any of its respective affiliates may hold securities in its own name or as a pledgee. For the purpose of meeting the legal requirements of some jurisdictions, the servicer and the trustee will have the power to appoint co-trustees or separate trustees of all or any part of the trust.

You will find the addresses of the principal offices of the trust, the trustee and the indenture trustee in your prospectus supplement.

Delinquencies, Repossessions and Net Losses

Certain information concerning HDCC's experience relating to delinquencies, repossessions and net losses with respect to its portfolio of new and used motorcycles contracts will be set forth in your prospectus supplement. There can be no assurance that the delinquency, repossession and net loss experience on the pool of contracts included in any trust will be comparable to prior experience.

Weighted Average Lives of the Securities

The weighted average lives of the securities of a trust will be a function of the weighted average lives of the contracts held by the trust. The weighted average lives of the contracts will be influenced by the rate at which the principal balances of the contracts are paid. The term "weighted average life" means the average amount of time during which each dollar of principal of a contract is outstanding.

All of the contracts will be prepayable at any time without penalty to the obligor. If full or partial prepayments are received on the contracts, the actual weighted average lives of the contracts will be shorter than the scheduled weighted average lives of the contracts set forth in your prospectus supplement. Prepayments include optional prepayments by obligors, liquidations due to default, partial prepayments from rebates of extended warranties and insurance premiums, as well as receipts of proceeds from physical damage, credit life and disability insurance policies and debt cancellation agreements. Prepayment rates are influenced by a variety of economic, social and other factors,

including the fact that an obligor generally may not sell or transfer the financed motorcycle securing a contract without obtaining the certificate of title from the servicer. We cannot predict the rate of prepayment on the contracts in either stable or changing interest rate environments.

The weighted average lives of the securities will also be impacted to the extent that the depositor or the seller is obligated to repurchase contracts from a trust as a result of breaches of particular representations and warranties relating to the contracts. See "Description of the Transfer and Servicing Agreements—Sale and Assignment of Contracts by Seller" and "—Transfer of Contracts by Depositor" in this prospectus. The weighted average lives of the securities will also be impacted to the extent the servicer is obligated to purchase contracts from a trust as a result of breaches of certain covenants relating to the contracts. See "Description of the Transfer and Servicing Agreements—Servicing" in this prospectus. In addition, early retirement of the securities may be effected by the exercise of the option of the servicer to purchase all of the contracts remaining in the trust when the aggregate outstanding principal balance of the contracts is less than 10% of the sum of (i) the aggregate outstanding principal balance of the contracts as of the initial cutoff date and (ii) the initial amount on deposit in the pre-funding account, if any. You will bear all of the reinvestment risk resulting from the rate of prepayments of the contracts.

Your prospectus supplement may set forth additional information regarding the maturity and prepayment considerations applicable to your pool of contracts and your securities.

Factors and Trading Information

The "note factor" for any class of securities issued by the trust will be a seven-digit decimal indicating the principal amount of that class of securities on the payment date as a fraction of the respective principal amount of that class as of the closing date. The servicer will compute the note factor each month. Initially, each factor will be 1.0000000 and thereafter will decline to reflect reductions in the principal amount of each class of notes. The servicer will compute the principal amount by allocating payments in respect of the contracts to principal and interest using the simple interest method. The portion of the principal amount of any class of notes for a given month allocable to a securityholder can be determined by multiplying the original denomination of the holder's security by the related note factor for that month.

You will receive monthly reports concerning the payments received on the contracts, the aggregate principal balance of the contracts, the related note factors and various other items of information pertaining to the trust. Furthermore, the trustee or the indenture trustee will furnish you with information for tax reporting purposes not later than on the latest date permitted by law. See "Description of the Transfer and Servicing Agreements—Servicing—Statements to Securityholders" in this prospectus.

Description of the Notes and Indenture

General

The issuance of each series of notes will be under an indenture, a form of which was filed with the Securities and Exchange Commission as an exhibit to the registration statement of which this prospectus is a part. In addition, a copy of the indenture for a series of notes will be filed with the Securities and Exchange Commission following the issuance of each series of securities. This summary describes the material terms of each indenture and the notes. This summary is subject to, and qualified in its entirety by reference to, all of the provisions of the indenture and the notes.

The notes will be issued in fully registered form only and will represent the obligations of a separate trust. Notes will be available for purchase by you in the denominations specified in your prospectus supplement.

Your prospectus supplement will provide additional information specific to your notes.

Payments

Your prospectus supplement will describe as to your class of notes:

•: the timing and priority of payments of principal and interest;
•: the amount and method of determining payments of principal and interest;
•: the priority of the application of the trust's available funds to its expenses and payments on its securities; and
•: the interest rates or the formula for calculating the interest rates.

Your rights to receive payments may be senior or subordinate to the rights of holders of other classes of notes. Furthermore, each class of notes may have a different interest rate, which may be a fixed, variable or adjustable interest rate or any combination of the foregoing. See "Information Regarding the Securities—Interest Rates" in this prospectus.

Payments of principal and interest on any class of notes will be made on a pro rata basis among all noteholders of that class. If the amount of funds available to make a payment on a class of notes is less than the required payment, the noteholders of such class of notes will receive their pro rata share of the amount available for that class.

Pro-Rata Pay/Subordinate Notes

One or more classes of notes may be payable on an interest only or principal only basis. In addition, the notes may include two or more classes that differ as to timing, sequential order, priority of payment, interest rate or amount of payments of principal or interest or both. Payments of principal or interest or both on any class may be made upon the occurrence of specified events, in accordance with a schedule or formula, or on the basis of collections from designated assets of the trust. A series may include one or more classes of notes, as to which accrued interest will not be distributed but rather will be added to the principal or notional balance of the notes on each payment date.

Variable Funding Note

A trust may issue one or more classes of notes having particular maturity dates and at the same time the trust may issue variable funding notes which relate to those particular maturity dates. These notes may have a balance that may decrease based on the amortization of contracts or increase based on principal collections used to purchase additional contracts.

Optional Purchase of Contracts and Redemption of Notes

At its option, the servicer may purchase all of the contracts owned by the trust on any payment date following the date on which the aggregate outstanding principal balance of the contracts is less than 10% of the sum of (i) the aggregate outstanding principal balance of the contracts as of the initial cutoff date and (ii) the initial amount on deposit in the pre-funding account, if any. Except as otherwise described in your prospectus supplement, the purchase price to be paid in connection with the purchase shall be at least equal to the sum of:

•: the unpaid principal balance of the contracts as of that payment date;
•: accrued but unpaid interest on the securities to that payment date;
•: unreimbursed servicer advances;
•: accrued but unpaid fees to the trustee and the indenture trustee; and
•: accrued but unpaid servicer fees.

If the seller purchases the contracts, the related notes will be repaid in full on the payment date on which the purchase occurs. In no event will you or the trust be subject to any liability to the seller as a result of or arising out of the seller's optional purchase of the contracts.

Voting Rights

Your prospectus supplement may specify certain circumstances under which the consent, approval, direction or request of the holders of a specified percentage of the outstanding principal amount of the notes or certain classes of notes must be obtained, given or made, or under which such holders are permitted to take an action or give a notice. Your prospectus supplement may further specify that one class of notes will control the voting with respect to all classes of notes.

The Indenture

Modification of Indenture Without Noteholder Consent

The trust and the indenture trustee may, without your consent, enter into one or more supplemental indentures for any of the following purposes:

•: to correct or amplify the description of any property at any time subject to the lien of the indenture;
•: to evidence the succession of another person to the trust and the assumption by any such successor of the covenants of the trust;
•: to add to the covenants of the trust or to surrender any right or power conferred upon the trust in the indenture;
•: to convey, transfer, assign, mortgage or pledge any property to or with the indenture trustee;
•: to cure any ambiguity, to correct or supplement any provision in the indenture which may be inconsistent with any other provision in the indenture, this prospectus or your prospectus supplement;
•: to evidence and provide for the acceptance of the appointment by a successor indenture trustee with respect to the notes and to add to or change any of the provisions of the indenture as shall be necessary to facilitate the administration of the trusts by more than one indenture trustee; or
•: to modify, eliminate or add to the provisions in the indenture to the extent necessary to qualify the indenture under the Trust Indenture Act.

In addition, if the indenture trustee receives an opinion of counsel that a modification will not have a material adverse effect on the noteholders, the trust and the indenture trustee may, without your consent, enter into one or more supplemental indentures to, among other things, add, modify or eliminate any provisions of the indenture or modify your rights as a noteholder.

Modification of Indenture With Noteholder Consent

With the consent of the holders of more than 50% (or such higher percentage as specified in your prospectus supplement) of the outstanding principal amount of the notes or the class or classes of notes described in your prospectus supplement, the trust and the indenture trustee may modify the indenture and your rights under it.

Without the consent of the holder of each outstanding note affected, however, no modification may:

•: reduce the principal amount or interest rate or change the due date of any payment;
•: modify the manner of application of collections in respect of the contracts to payment on the notes;
•: impair your right to sue to enforce payment provisions of the indenture;
•: reduce the percentage of the aggregate principal amount of the notes to amend certain sections of the indenture or certain other related agreements;
•: permit the creation of any lien on collateral under the indenture ranking prior to or on a parity with the lien of the indenture;
•: adversely affect the manner of determining notes outstanding for voting purposes;
•: reduce the percentage of the aggregate principal amount of the notes needed to sell or liquidate the assets of the trust if the proceeds of sale will be insufficient to pay the notes in full; or
•: modify the provisions of the indenture relating to these types of indenture modifications without the consent of all noteholders.

Events of Default; Rights Upon Event of Default

Events of default under each indenture will consist of:

•: a default for five days or more in the payment of interest due on any note;
•: failure to pay the unpaid principal amount of any class of notes when due and payable;
•: a default in the observance or performance of any covenant or agreement of the trust (other than those specifically addressed above), which default has a material adverse effect on the noteholders and continues for 30 days after written notice thereof is given to the trust by the indenture trustee or by holders of at least 25% of the aggregate principal amount of the notes or the class or classes of notes described in your prospectus supplement;
•: any representation or warranty made by the trust in the indenture or in any certificate delivered pursuant thereto was incorrect as of the time made, and continues to be incorrect for a period of 30 days after notice thereof is given to the trust by the indenture trustee or by holders of at least 25% of the aggregate principal amount of the notes or the class or classes of notes described in your prospectus supplement; or
•: events of bankruptcy, insolvency, receivership or liquidation of the trust.

If an event of default should occur and be continuing with respect to the notes of a series, other than an event of default caused by an event of bankruptcy, insolvency, receivership or liquidation of the trust, the indenture trustee or the holders of more than 66²/3% (or a lesser percentage as specified in your prospectus supplement, but in no case not less than 50%) of the aggregate principal amount of the notes or the class or classes of notes described in your prospectus supplement may declare the principal amount of the notes to be immediately due and payable. If an event of default caused by an event of bankruptcy, insolvency, receivership or liquidation of the trust should occur and be continuing with respect to the notes of a series, the principal amount of the notes will be immediately due and payable. This declaration may be rescinded by the holders of more than 66²/3% (or a lesser percentage as specified in your prospectus supplement, but in no case not less than 50%) of the aggregate principal amount of the notes or the class or classes of notes described in your prospectus supplement if:

•: the trust has made all payments of principal and interest then due on the notes (assuming the notes had not been accelerated); and
•: the trust has paid all amounts then owing to the indenture trustee.

If the notes of a series have been declared to be due and payable following an event of default, the indenture trustee may:

•: institute proceedings to collect amounts due or foreclose on the trust assets;
•: exercise remedies as a secured party; or
•: sell the trust assets, or elect to have the trust maintain possession of the trust assets.

The indenture trustee, however, may not sell the trust assets following an event of default other than a default in the payment of principal or a default for five days or more in the payment of interest, unless:

•: the holders of all the outstanding notes consent to the sale;
•: the proceeds of the sale are sufficient to pay in full the principal and accrued interest on all the outstanding notes at the date of the sale; or
•: there has been an event of default for failure to pay principal or interest on the notes and the indenture trustee determines that the trust assets would not be sufficient on an ongoing basis to make all payments on the notes as the payments would have become due if the obligations had not been declared due and payable and the indenture trustee provides written notice to the rating agencies and obtains the consent of the holders of more than 66²/3% (or a lesser percentage as specified in your prospectus supplement, but in no case not less than 50%) of the aggregate principal amount of the notes or the class or classes of notes described in your prospectus supplement.

Following a declaration upon an event of default that the notes are immediately due and payable, the application of any proceeds of any sale of the trust assets will be in the order of priority described in your prospectus supplement for your class of notes.

If an event of default occurs and is continuing, the indenture trustee will be under no obligation to exercise any of the rights or powers under the indenture at the request or direction of any of the noteholders if the indenture trustee reasonably believes it will not be adequately indemnified against the costs, expenses and liabilities which it may incur in complying with that request. Holders of more than 50% of the aggregate principal amount of the notes or the class or classes of notes described in your prospectus supplement will have the right to direct the time, method and place of conducting any proceeding or any remedy available to the indenture trustee subject to the preceding sentence. Additionally, holders of more than 50% of the aggregate principal amount of the notes or the class or

classes of notes described in your prospectus supplement may, in some cases, waive any default, except a default in the payment of principal or interest or a default in respect of a covenant or provision of the indenture that cannot be modified without the waiver or consent of all of the holders of the outstanding notes.

No holder of a note will have the right to institute any proceeding with respect to the indenture, unless:

•: the holder previously has given to the indenture trustee written notice of a continuing event of default;
•: the holders of not less than 25% in principal amount of the outstanding notes or the class or classes of notes described in your prospectus supplement make written request of the indenture trustee to institute the proceeding in its own name as indenture trustee;
•: the holder or holders offer the indenture trustee reasonable indemnity;
•: the indenture trustee has for 60 days failed to institute a proceeding; and
•: no direction inconsistent with that written request has been given to the indenture trustee during the 60-day period by the holders of more than 50% of the notes or the class or classes of notes described in your prospectus supplement.

Notwithstanding the foregoing, noteholders will have the absolute and unconditional right to receive payment of principal of and interest on a note and to institute suit for the enforcement of such payment, which right will not be impaired without the individual noteholder's consent.

In addition, the indenture trustee and noteholders, by accepting the notes, will covenant that they will not at any time institute against the depositor or the trust any bankruptcy, reorganization or other proceeding under any federal or state bankruptcy or similar law.

Neither the trustee, the holder of any certificate, the seller, the depositor, or any of their respective owners, beneficiaries, agents, officers, directors, employees, affiliates, successors or assigns will be personally liable for the payment of the notes or for any agreement or covenant of the trust contained in the indenture.

Covenants

Each indenture will provide that the trust may not consolidate with or merge into any other entity, unless:

•: the entity formed by or surviving the consolidation or merger is organized under the laws of the United States, any state or the District of Columbia;
•: the entity expressly assumes the trust's obligation to make due and punctual payments upon the notes and the performance or observance of every agreement and covenant of the trust under the indenture;
•: no event of default shall have occurred and be continuing immediately after the merger or consolidation;
•: the rating agencies rating the notes advise the indenture trustee that the ratings then in effect would not be reduced or withdrawn as a result of the merger or consolidation;
•: the indenture trustee has received an opinion of counsel to the effect that the consolidation or merger would have no material adverse tax consequence to the trust or to any noteholder;
•: any action as is necessary to maintain the lien and security interest of the indenture trustee shall have been taken; and

•: the trust or the person, if other than the trust, formed by or surviving the consolidation or merger has a net worth, immediately after the consolidation or merger, that is (a) greater than zero and (b) not less than the net worth of the trust immediately prior to giving effect to the consolidation or merger.

Each indenture will provide that the trust will not, among other things:

•: except as expressly permitted by the related indenture, trust agreement or sale and servicing agreement, transfer any of the assets of the trust;
•: claim any credit on or make any deduction from, the principal and interest payable in respect of the notes, other than amounts withheld under the United States Bankruptcy Code or applicable state law, or assert any claim against any present or former holder of notes because of the payment of taxes levied or assessed upon the trust;
•: dissolve or liquidate in whole or in part;
•: permit the validity or effectiveness of the indenture to be impaired or permit the release of any person from any covenants or obligations relating to the notes under the indenture except as expressly permitted in the indenture; or
•: except as expressly permitted in the indenture, permit any lien or claim to burden any assets of the trust.

Each indenture will provide that the trust may engage in only those activities specified above under "The Trusts." The trust will be prohibited from incurring, assuming or guaranteeing any indebtedness other than indebtedness incurred under the notes and the indenture or otherwise in accordance with the related indenture, trust agreement and sale and servicing agreement.

Annual Compliance Statement

Each trust will be required to file annually with the applicable indenture trustee a written statement as to the fulfillment of its obligations under the indenture.

Indenture Trustee's Annual Report

Each indenture trustee will be required to mail each year to all noteholders of the related series a brief report relating to:

•: its eligibility and qualification to continue as indenture trustee under the indenture;
•: amounts, if any, advanced by it under the indenture;
•: the amount, interest rate and maturity date of certain indebtedness owing by the trust to the indenture trustee in its individual capacity;
•: the property and funds physically held by the indenture trustee; and
•: any action taken by it that materially affects the notes and that has not been previously reported.

Satisfaction and Discharge of Indenture

The discharge of an indenture will occur with respect to the assets securing the notes of a series upon the delivery to the indenture trustee for cancellation of all the notes or, with certain limitations, upon deposit with the indenture trustee of funds sufficient for the payment in full of all of the notes and payment of all amounts and obligations, if any, which the trust owes to the noteholders or indenture trustee on behalf of the noteholders.

Trust Accounts

Under each indenture, if the indenture trustee has a rating of A-1+/P-1 by Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc., and Moody's Investors Service, Inc., the indenture trustee will establish and maintain segregated bank accounts for the trust. If the indenture trustee has a rating lower than A-1+/P-1, the indenture trustee will establish and maintain segregated trust accounts or accounts in a qualified institution. These accounts will include, among others, a "collection account" and a "distribution account." The trust accounts may, as described in your prospectus supplement for your notes, also include a cash collateral or reserve fund account as credit enhancement.

"Qualified institution" means the corporate trust department of the indenture trustee or any other depositary institution:

•: organized under the laws of the United States or any state or any domestic branch of a foreign bank;
•: the deposits of which are insured by the Federal Deposit Insurance Corporation; and
•: which has, or whose parent corporation has, short-term or long-term debt ratings acceptable to Moody's Investors Service, Inc. and Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc.

The indenture trustee will invest funds in the trust accounts at the direction of the servicer. All investments will be generally limited to investments acceptable to the rating agencies rating the notes as being consistent with the ratings of those notes that will mature not later than the business day preceding the applicable payment date or any later date approved by the rating agencies. If the rating agencies permit the investment of funds on deposit in a cash collateral or reserve fund account in investments that mature beyond a payment date, the amount of cash available in the cash collateral or reserve fund account may be less than the amount required to be withdrawn from that trust account to cover shortfalls in collections on the contracts and a temporary shortfall in the amounts paid to the noteholders may result. Investment earnings on funds deposited in the trust accounts will be paid to the person described in your prospectus supplement.

See "Description of the Transfer and Servicing Agreements" in this prospectus for summaries of the material terms of the trust agreement, sale and servicing agreement and administration agreement.

Information Regarding the Securities

Interest Rates

A class of securities may bear interest at a fixed, variable or adjustable rate per annum, as more fully described below and in your prospectus supplement.

Fixed Rate Securities. Each class of fixed rate securities will bear interest at the applicable per annum interest rate or pass through rate, specified in your prospectus supplement. Interest on each class of fixed rate securities will be computed on the basis of a 360-day year consisting of twelve 30-day months or on such other day count basis as is specified in your prospectus supplement.

Floating Rate Securities. Each class of floating rate securities will bear interest during each applicable interest period at a rate per annum determined by reference to a base rate, plus or minus a specified spread, if any, or multiplied by the spread multiplier, if any, as specified in your prospectus supplement. The "spread" is a number of basis points to be added to or subtracted from the related base rate. The "spread multiplier" is a percentage of the related base rate by which that base rate will be multiplied to determine the applicable interest rate. Your prospectus supplement will designate one of the following base rates as applicable to a floating rate security:

•: London interbank offered rate;
•: commercial paper rates;
•: Treasury rate;
•: federal funds rate;
•: negotiable certificates of deposit rate; or
•: any other base rate that is set forth in your prospectus supplement.

Your prospectus supplement will specify whether the interest rate will be reset daily, weekly, monthly, quarterly, semiannually, annually or some other specified period and the dates on which that interest rate will be reset. If the reset date does not fall on a business day, then the reset date will be postponed to the next succeeding business day; except that with respect to securities having a base rate based on the London interbank offered rate, if the reset date falls in the next succeeding calendar month, then the reset date will be the immediately preceding business day.

Interest on each class of floating rate security will accrue on an Actual/360 basis, an Actual/Actual basis, or a 30/360 basis. For floating rate securities calculated on an Actual/360 basis and Actual/Actual basis, accrued interest for each interest period will be calculated by multiplying:

1.: the face amount of that floating rate security;
2.: the applicable interest rate; and
3.: the actual number of days in the related interest period, and dividing the resulting product by 360 or the actual number of days in the related year, as applicable.

For floating rate securities calculated on a 30/360 basis, accrued interest for an interest period will be computed on the basis of a 360-day year consisting of twelve 30-day months, irrespective of how many days are actually in that interest period.

Floating rate securities may also have either or both of the following:

•: a maximum limitation, or ceiling, on the rate at which interest may accrue during any interest period; and

•: a minimum limitation, or floor, on the rate at which interest may accrue during any interest period.

The applicable interest rate will not exceed the maximum rate permitted by applicable law.

A trust issuing floating rate securities will appoint a calculation agent to calculate interest rates on each class of floating rate securities. Your prospectus supplement will set forth the identity of the calculation agent, which may be the related trustee or indenture trustee with respect to that series. All determinations of interest by the calculation agent shall, in the absence of manifest error, be conclusive for all purposes and binding on the holders of floating rate securities of a given class. All percentages resulting from any calculation on floating rate securities will be rounded to the nearest one hundred-thousandth of a percentage point, with five one millionths of a percentage point rounded upwards, and all dollar amounts used in or resulting from that calculation on floating rate securities will be rounded to the nearest cent.

CD Rate Securities. The base rate for any securities having a base rate based on a CD rate for each reset date shall be either:

•: the rate for negotiable certificates of deposit having the index maturity designated in your prospectus supplement as published in H.15(519) under the heading "CDs (Secondary Market)" as of the second business day prior to the reset date; or
•: if that rate is not published prior to 3:00 p.m. New York City time on that business day, the rate for negotiable certificates of deposit having the index maturity designated in your prospectus supplement as published in H.15 Daily Update under the heading "CDs (Secondary Market)" or such other recognized electronic source used for the purpose of displaying such rate; or
•: if by 3:00 p.m. New York City time on that business day, that rate is not yet published in either H.15(519) or H.15 Daily Update or such other recognized electronic source used for the purpose of displaying such rate, the arithmetic mean of the secondary market offered rates as of 10:00 a.m. New York City time on that business day, of three leading nonbank dealers in negotiable U.S. dollar certificates of deposit in the City of New York selected by the calculation agent for negotiable certificates of deposit of major United States money market banks with a remaining maturity closest to the index maturity designated in your prospectus supplement in an amount that is representative for a single transaction in that market at that time.

"H.15(519)" means the publication entitled "Federal Reserve Statistical Release H.15(519), Selected interest rates," or any successor publication, published by the Board of Governors of the Federal Reserve System.

"H.15 Daily Update" means the publication entitled "H.15 Daily Update, Selected interest rates," or any successor publication, published by the Board of Governors of the Federal Reserve System.

Commercial Paper Rate Securities. The base rate of any securities having a base rate based on commercial paper rates for each reset date shall be either:

•: the money market yield on the reset date of the rate for commercial paper having the index maturity specified in your prospectus supplement, as published in H.15(519) under the heading "Commercial Paper—Nonfinancial" as of the second business day prior to the reset date; or
•: if that rate is not published prior to 3:00 p.m. New York City time on that business day, the money market yield on the second business day prior to the reset date of the rate for commercial paper of the specified index maturity as published in H.15 Daily Update or such other recognized electronic source used for the purpose of displaying such rate under the heading "Commercial Paper—Nonfinancial"; or

•: if by 3:00 p.m. New York City time on that business day, that rate is not yet published in either H.15(519) or H.15 Daily Update or such other recognized electronic source used for the purpose of displaying such rate, the money market yield of the arithmetic mean of the offered rates, as of 11:00 a.m. New York City time, on that date of three leading dealers of commercial paper in the City of New York selected by the calculation agent for commercial paper of the specified index maturity placed for an industrial issuer whose bonds are rated "AA" or the equivalent by a nationally recognized rating agency.

"Money market yield" means a yield calculated in accordance with the following formula:

Money Market Yield =

D × 360

360 - (D × M)

x 100

where "D" refers to the applicable per annum rate for commercial paper quoted on a bank discount basis and expressed as a decimal, and "M" refers to the actual number of days in the interest period for which interest is being calculated.

Federal Funds Rate Securities. The base rate for any securities having a base rate based on the federal funds rate for each reset date shall be either:

•: the rate set forth in H.15(519) for that date opposite the caption "Federal Funds (Effective)" as such rate is displayed on Bridge Telerate, Inc. Page 120 (or any other page as may replace that page); or
•: if that rate does not appear on Bridge Telerate, Inc. Page 120 or is not published in H.15(519) prior to 3:00 p.m. New York City time, the rate set forth in H.15 Daily Update or such other recognized electronic source used for the purpose of displaying such rate under the heading "Federal Funds/Effective Rate"; or
•: if by 3:00 p.m. New York City time, that rate does not appear on Bridge Telerate, Inc. Page 120 or is not yet published in either H.15(519) or H.15 Daily Update or such other recognized electronic source used for the purpose of displaying such rate, the arithmetic mean of the rates for the last transaction in overnight United States dollar federal funds arranged by three leading brokers of federal funds transactions in the City of New York selected by the calculation agent prior to 9:00 a.m. New York City time.

LIBOR Securities. The base rate for any securities having a base rate based on LIBOR will be determined by the calculation agent as follows:

1.

On the second London business day prior to the reset date, the calculation agent will determine the offered rates for deposits in U.S. dollars for the period of the index maturity specified in your prospectus supplement, as either

•: if "LIBOR Bloomberg" is specified in the applicable prospectus supplement, the arithmetic mean of the offered rates for deposits in the index currency having the index maturity designated in your prospectus supplement, commencing on the reset date, that appear on the page specified in your prospectus supplement as of 11:00 a.m. London time on the second London business day prior to the reset date if at least two offered rates appear (unless, described above, only a single rate is required) on that page, or
•: if "LIBOR Telerate" is specified in your prospectus supplement, the rate for deposits in the index currency having the index maturity designated in your prospectus supplement, commencing on reset date that appears on the page specified in your prospectus supplement as of 11:00 a.m. London time, on the second London business day prior to the reset date.

2.

If "LIBOR Bloomberg" is specified and fewer than two offered rates appear on the designated page or if LIBOR Telerate is specified and no rate appears on the designated page, the calculation agent will request the principal London offices of each of four major banks in the London interbank market to provide the calculation agent with its offered quotations for deposits in the index currency for the period of the index maturity designated in your prospectus supplement, commencing on the reset date, to prime banks in the London interbank market at approximately 11:00 a.m. London time on the second London business day prior to the reset date and in a principal amount that is representative for a single transaction in that index currency in that market at that time.

•: If at least two of those quotations are provided, LIBOR will be the arithmetic mean of those quotations.
•: If fewer than two quotations are provided, LIBOR will be the arithmetic mean of the rates quoted at approximately 11:00 a.m., in the applicable principal financial center, on the second London business day prior to the reset date by three major banks in that principal financial center for loans in the index currency to leading European banks, having the index maturity designated in your prospectus supplement and in a principal amount that is representative for a single transaction in that index currency in that market at that time; provided, however, that if the banks so selected by the calculation agent are not quoting offered rates as mentioned in this sentence, LIBOR will be LIBOR in effect on the reset date.

"Index currency" means the currency specified in your prospectus supplement as the currency for which LIBOR shall be calculated. If no currency is specified in your prospectus supplement, the index currency shall be U.S. dollars.

"Principal financial center" will generally be the capital city of the country of the specified index currency, except that with respect to U.S. dollars, Deutsche marks, Canadian dollars, Australian dollars, Italian lira, Swiss francs, Dutch guilders and Euros, the principal financial center shall be New York, Frankfurt, Toronto, Sydney, Milan, Zurich, Amsterdam and London, respectively.

Treasury Rate Securities. The base rate for any securities having a base rate based on the Treasury rate for each reset date shall be either:

•: the rate for the most recent auction of Treasury bills having the index maturity specified in your prospectus supplement, as that rate shall be set forth under the heading "Investment Rate" on the display on Bridge Telerate, Inc. Page 56 or Bridge Telerate, Inc. Page 57 (or such other page as may replace either of those pages opposite the index maturity) or,
•: if Treasury bills of the index maturity have been auctioned but that rate for those Treasury bills does not appear on either Bridge Telerate, Inc. Page 56 or Bridge Telerate, Inc. Page 57 prior to 3:00 p.m. New York City time the auction average rate for those Treasury bills announced by the United States Department of the Treasury, or
•: if the results of the auction of Treasury bills having the specified index maturity are not announced as provided above by 3:00 p.m. New York City time or if that auction is not held in a particular week, the rate published in H.15(519) under the heading "U.S. Government Securities—Treasury bills—Secondary market", or
•: if that rate does not appear on H.15(519) by 3:00 p.m. New York City time the rate set forth in H.15 Daily Update or such other recognized electronic source used for the purpose of displaying that rate under the heading "U.S. Government Securities—Treasury bills—Secondary market," or

•: if those results are not published in H.15 Daily Update or another recognized electronic source used for the purpose of displaying such rate by 3:00 p.m. New York City time, the arithmetic mean of the secondary market bid rates, as of approximately 3:30 p.m. New York City time on that date, of three leading primary United States government securities dealers selected by the calculation agent for the issue of Treasury bills with a remaining maturity closest to the specified index maturity.

Indexed Securities. Any class of securities may consist of securities in which the amounts payable on the final scheduled payment date and/or the interest payable on any payment date is determined by reference to a measure which will be related to the exchange rates of one or more currencies or composite currencies or the price of commodities or stocks, on dates as specified in the applicable prospectus supplement. Holders of indexed securities may receive a principal amount on the related final scheduled payment date that is greater than or less than the face amount of the indexed securities depending upon the relative value on the related final payment date of the specified indexed item. Your prospectus supplement will contain information as to the method for determining the principal amount payable on the related final scheduled payment date, if any, and, where applicable, historical information with respect to the specific indexed item or items and special tax considerations associated with an investment in indexed securities. For purposes of determining the rights of a holder of a security indexed as to principal in respect of voting for or against amendments to the related trust agreement, indenture, or other related agreements, as the case may be, and modifications and the waiver of rights under those agreements, the principal amount of that indexed security shall be deemed to be the face amount thereof upon issuance less any payments allocated to principal of that indexed security.

If the principal amount of an indexed security is based on an index calculated or announced by a third party and that third party either suspends the calculation or announcement of that index or changes the basis upon which that index is calculated, then that index shall be calculated by an independent calculation agent named in your prospectus supplement on the same basis, and subject to the same conditions and controls, as applied to the original third party. If for any reason that index cannot be calculated on the same basis and subject to the same conditions and controls as applied to the original third party, then the principal amount of that indexed security shall be calculated in the manner set forth in the applicable prospectus supplement. Any determination of that independent calculation agent shall, in the absence of manifest error, be binding on all parties.

Your prospectus supplement will describe whether the principal amount of the related indexed security, if any, that would be payable upon repayment prior to the applicable final scheduled payment date will be the face amount of that indexed security, the principal amount of that indexed security at the time of repayment or another amount described in your prospectus supplement.

Credit and Cash Flow Enhancement

The amounts and types of credit and cash flow enhancement arrangements and the applicable provider, if any, will be set forth in your prospectus supplement. This credit or cash flow enhancement may be in one or more of the following forms:

•: subordination of one or more classes of securities;
•: spread account;
•: reserve fund;
•: over-collateralization;
•: letter of credit;
•: credit or liquidity facility;

•: financial guaranty insurance policy;
•: surety bond;
•: guaranteed investment contract or other interest rate protection agreement;
•: repurchase obligation;
•: yield supplement agreement;
•: swap or other interest rate protection agreement;
•: other agreements with respect to third party payments or other support; or
•: cash deposit or other arrangement that may be described in your prospectus supplement.

Credit and cash flow enhancement is intended to enhance the likelihood that you will receive the full amount of principal and interest due on your securities and to decrease the likelihood that that you will experience losses. The enhancement for a class or series of securities will not provide protection against all risks of loss and will not guarantee repayment of the entire principal of and interest on those securities. If losses occur which exceed the amount covered by any credit or cash flow enhancement or which are not covered by any credit or cash flow enhancement, you will bear your allocable share of deficiencies, as described in your prospectus supplement. In addition, if a form of enhancement covers more than one class or series of securities, you will be subject to the risk that the enhancement will be exhausted by the claims of securityholders of other classes or series.

If so provided in your prospectus supplement, the depositor or the trust may replace the credit or cash flow enhancement for any class of securities with another form of credit or cash flow enhancement without the consent of the securityholders, provided that the rating agencies rating that class of securities confirm that such substitution of credit or cash flow enhancement will not result in the reduction or withdrawal of the rating of that class of securities.

Reserve Fund

The depositor or a third party may establish for a series or class of securities an account or reserve fund which will be maintained with a collateral agent or the trustee or indenture trustee. The reserve fund will be funded by an initial deposit by the depositor or a third party on the closing date in the amount set forth in your prospectus supplement and, if the trust has a pre-funding account, will also be funded on each date that the trust acquires subsequent contracts from the depositor to the extent described in your prospectus supplement. The amount on deposit in the reserve fund will be increased on each payment date thereafter up to the reserve fund required amount by the deposit in the reserve fund of the amount of collections on the contracts available therefor as described in your prospectus supplement.

Your prospectus supplement will describe the circumstances and manner under which payments may be made out of the reserve fund, either to make payments or distributions to you or to the servicer or a third party. Monies on deposit in the reserve fund may be invested in investments acceptable to the rating agencies rating the securities as being consistent with the ratings of those securities under the circumstances and in the manner described in the related sale and servicing agreement or indenture. Earnings on investment of funds in the reserve fund in eligible investments will be paid to the person described in your prospectus supplement under the circumstances described in your prospectus supplement on each payment date. Any monies remaining on deposit in the reserve fund upon termination of the trust will be released to the depositor or its assignee.

Book-Entry Registration

Each class of securities offered by this prospectus will be represented by one or more notes and/or certificates issued to or registered in the name of Cede & Co., as nominee of The Depository Trust Company. Unless your prospectus supplement states otherwise, you may hold your securities through DTC in the United States, or Clearstream, Luxembourg or the Euroclear System in Europe, if you are a participant of those systems, or indirectly through organizations that are participants in those systems.

DTC is a limited purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code and a "clearing agency" registered under to Section 17A of the Securities Exchange Act of 1934. DTC was created to hold securities for its direct participants and to facilitate the clearance and settlement of securities transactions between its direct participants through electronic book-entries, thereby eliminating the need for physical movement of certificates. DTC's direct participants include:

•: the underwriters offering the securities to you;
•: securities brokers and dealers;
•: banks;
•: trust companies; and
•: clearing corporations, and may include other organizations.

Indirect access to the DTC system is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a direct participant, either directly or indirectly.

To facilitate subsequent transfers, DTC will register all deposited securities in the name of DTC's nominee, Cede & Co. DTC has no knowledge of the actual holders of the securities; DTC's records only identify its direct participants to whose accounts the securities are credited, which may or may not be the securityholders. DTC's direct and indirect participants will remain responsible for keeping account of their holdings on behalf of their customers.

You have no entitlement to receive a certificate representing your interest in a class of securities. As long as the securities are registered in the name of Cede & Co., any action to be taken by you or any other holders will be taken by DTC upon instructions from DTC's participants. All distributions, notices, reports and statements to you will be delivered to Cede & Co., as the registered holder of the securities, for distribution to you in compliance with DTC procedures.

You will receive all payments of principal and interest on the securities through direct participants or indirect participants. DTC will forward the payments to its direct participants which will forward them to the indirect participants or securityholders. Under a book-entry format, you may experience some delay in receipt of payments, since payments will be forwarded to Cede & Co. as nominee of DTC. The trustee or indenture trustee will not recognize you as a holder of securities under the trust agreement or indenture. You may exercise the rights as a holder of securities only indirectly through DTC and its direct participants and indirect participants. Because DTC can act only on behalf of direct participants, who in turn act on behalf of indirect participants, and on behalf of banks, trust companies and other persons approved by it, there may be limits on your ability to pledge the securities to persons or entities that do not participate in the DTC system, or to otherwise act with respect to securities, due to the absence of physical certificates for the securities.

Arrangements among the various parties govern conveyance of notices and other communications by:

•: DTC to direct participants;
•: by direct participants to indirect participants; and
•: by direct participants and indirect participant to securityholders, subject to any statutory or regulatory requirements as may be in effect from time to time.

Standing instructions and customary practices govern payments by DTC participants to you, as is the case with securities held for the accounts of customers in bearer form or registered in "street name" and will be the responsibility of the DTC participant and not of DTC, the indenture trustee, the trustee, the depositor or the seller, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment or distribution of principal and interest to DTC is the responsibility of the indenture trustee or trustee, disbursement of the payments or distributions to direct participants shall be the responsibility of DTC and disbursement of payments to you shall be the responsibility of the direct participants and the indirect participants.

Purchases of securities under the DTC system must be made by or through direct participants, which will receive a credit for the securities on DTC's records. The ownership interest of each actual securityholder is in turn to be recorded on the direct participants' and indirect participants' records. You will not receive written confirmation from DTC of your purchase, but you are expected to receive written confirmations providing details of the transaction, as well as periodic statements of your holdings, from the direct participant or indirect participant through which you entered into the transaction. Entries made on the books of DTC's participants acting on behalf of you evidence transfers of ownership interests in the securities.

DTC has advised the depositor that it will take any action permitted to be taken by a holder of securities only at the direction of one or more direct participants to whose accounts with DTC the securities are credited. Additionally, DTC has advised the depositor that to the extent that the the trust agreement or the indenture, as applicable, requires that any action may be taken only by holders representing a specified percentage of the aggregate outstanding principal amount of the securities, DTC will take the action only at the direction of and on behalf of direct participants, whose holdings include undivided interests that satisfy the specified percentage.

DTC may discontinue providing its services as securities depositary with respect to any class of securities at any time by giving reasonable notice to the trustee or the indenture trustee, as applicable. Under these circumstances, in the event that a successor securities depositary is not obtained, fully registered, certificated securities are required to be printed and delivered. A trust may decide to discontinue use of the system of book-entry transfers through DTC or a successor securities depositary. In that event, fully registered, certificated securities will be delivered to you. See "—Issuance of Definitive Securities."

The information in this section concerning DTC and DTC's book-entry system are from sources that the depositor believes to be reliable, but the depositor does not take any responsibility for the accuracy of this information.

Clearstream and Euroclear will hold omnibus positions on behalf of the participants in the Clearstream and Euroclear systems, respectively, through customers' securities accounts in Clearstream's and Euroclear's names on the books of their respective depositaries which in turn will hold these positions in customers' securities accounts in the depositaries' names on the books of DTC.

Clearstream is incorporated under the laws of Luxembourg as a professional depositary. Clearstream holds securities for its participants and facilitates the clearance and settlement of securities

transactions between its participants through electronic book-entry changes in accounts of its participants, thereby eliminating the need for physical movement of certificates.

Indirect access to Clearstream is also available to others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Clearstream participant, either directly or indirectly.

Euroclear was created in 1968 to hold securities for participants of Euroclear and to clear and settle transactions between Euroclear's participants through simultaneous electronic book entry delivery against payment, thereby eliminating the need for physical movement of certificates and any risk from lack of simultaneous transfers of securities and cash. The Brussels, Belgium office of Morgan Guaranty Trust Company of New York operates Euroclear, under contract with Euroclear Clearance Systems S.C., a Belgian cooperative corporation. Euroclear's operator conducts all operations and all Euroclear securities clearance accounts and Euroclear cash accounts are accounts with Euroclear's operator. Euroclear Clearance Systems S.C. establishes policy for Euroclear on behalf of Euroclear's participants, including banks, securities brokers and dealers, and other professional financial intermediaries.

Indirect access to Euroclear is also available to other firms that clear through or maintain a custodial relationship with a Euroclear participant, either directly or indirectly.

The Brussels, Belgium office of Morgan Guaranty Trust Company of New York is the Belgian branch of a New York banking corporation which is a member bank of the Federal Reserve System. As such, the Board of Governors of the Federal Reserve System and the New York Banking Department, as well as the Belgian Banking Commission, regulates and examines it.

Euroclear holds all securities on a fungible basis without attribution of specific certificates to specific securities clearance accounts. The Euroclear operator acts under the Euroclear terms and conditions only on behalf of Euroclear's participants, and has no record of or relationship with persons holding through Euroclear's participants.

Transfers between direct participants will comply with DTC rules. Transfers between Clearstream's participants and Euroclear's participants will comply with their rules and operating procedures.

DTC will effect, under DTC rules, cross-market transfers between persons holding directly or indirectly through DTC in the United States, on the one hand, and directly or indirectly through Clearstream or Euroclear, on the other, through the relevant European international clearing system through its depository; however, these cross-market transactions will require delivery of instructions to the relevant European international clearing system by the counterparty in this system as required by its rules and procedures and within its established deadlines, European time. The relevant European international clearing system will, if the transaction meets its settlement requirement, deliver instructions to its depositary to take action to effect final settlement on its behalf by delivering or receiving securities in DTC, and making or receiving payment using its normal procedures for same-day funds settlement applicable to DTC. Clearstream participants and Euroclear participants may not deliver instructions directly to the depositories.

Because of time-zone differences, credits of securities in Clearstream or Euroclear as a result of a transaction with a DTC participant will be made during the subsequent securities settlement processing day, dated the business day following the DTC settlement date, and the credits or any transactions in the securities settled during the processing day will be reported to the relevant Clearstream participant or Euroclear participant on that business day. Cash received in Clearstream or Euroclear as a result of sales of securities by or through a Clearstream participant or a Euroclear participant to a DTC participant will be received with value on the DTC settlement date but will be available in the relevant Clearstream or Euroclear cash account only as of the business day following settlement in DTC.

Although DTC, Clearstream and Euroclear have agreed to the foregoing procedures in order to facilitate transfers of securities among participants of DTC, Clearstream and Euroclear, they are under no obligation to perform or continue to perform these procedures and these procedures may be discontinued at any time.

Except as required by law, none of the seller, the servicer, the depositor, the trustee or the indenture trustee will have any liability for any aspect of the records relating to, actions taken or implemented by, or payments made on account of, beneficial ownership interests in the securities held through DTC, or for maintaining, supervising or reviewing any records or actions relating to beneficial ownership interests.

Issuance of Definitive Securities

The trust will issue the notes in fully registered, definitive form to beneficial owners or their nominees rather than to DTC or its nominee, only if:

(1) DTC is no longer willing or able to discharge properly its responsibilities as depository with respect to the securities, and the trustee or the indenture trustee is unable to locate a qualified successor;

(2) The administrator of the trust or the trustee, as applicable, notifies DTC of its intent to terminate the book-entry system through DTC and requests a withdrawal of the securities held by DTC, and after receipt by the DTC participants of an important notice issued by DTC notifying the DTC participants of such withdrawal request, the DTC participants holding beneficial interests in the securities agree to initiate such termination; or

(3) After the occurrence of an event of default under the indenture or a servicer default under the sale and servicing agreement, holders representing more than 50% of the notes of that series, acting together as a single class, advise the applicable indenture trustee or trustee through DTC in writing that the continuation of a book-entry system through DTC with respect to those notes is no longer in the best interests of the holders of those securities.

Upon the occurrence of any of the three events described immediately above, the applicable indenture trustee or trustee must notify all beneficial owners for each class of securities held through DTC of the availability of securities in fully registered, definitive form. Upon surrender by DTC of the global note representing the securities and instructions for reregistration, the indenture trustee or trustee will issue these fully registered, definitive securities, and the indenture trustee or trustee will recognize the holders of fully registered, definitive securities.

Additionally, upon the occurrence of any event described above, the indenture trustee or trustee will distribute principal of and interest on the securities directly to you as required by the indenture or trust agreement. Distributions will be made by check, mailed to your address as it appears on the register maintained by the applicable trustee or indenture trustee. Upon at least five days' notice to holders of a class of securities, however, the indenture trustee or trustee will make the final payment on any security only upon presentation and surrender of the security at the office or agency specified in the notice of final distribution to the securityholders. The indenture trustee or trustee will make the final payment in this manner whether the securities are in book-entry form or definitive form.

You may transfer any fully registered, definitive security of any class at the offices of the indenture trustee or trustee or its agent in New York, New York, which the indenture trustee or trustee shall designate on or prior to the issuance of any fully registered, definitive securities with respect to that class. There is no service charge for any registration of transfer or exchange, but the indenture trustee or trustee may require payment of a sum sufficient to cover any tax or other governmental charge imposed in connection with the transfer or exchange.

Description of the Transfer and Servicing Agreements

This section summarizes the material terms of the following agreements:

•: the transfer and sale agreement pursuant to which the seller will sell and assign all right, title and interest in the pool of contracts and the related property to the depositor;
•: the sale and servicing agreement pursuant to which the depositor will deposit the pool of contracts and the related property to the trust and the servicer will agree to service those contracts;
•: the trust agreement pursuant to which a trust will be created; and
•: the administration agreement pursuant to which Harley-Davidson Credit Corp. will undertake specified administrative duties with respect to a trust that issues notes.

Forms of these documents, which we collectively refer to as the "transfer and servicing agreements", have been filed as exhibits to the registration statement of which this prospectus is a part. In addition, a copy of the relevant transfer and servicing agreements relating to a series of securities will be filed with the Securities and Exchange Commission following the sale of those securities. This summary describes the material terms of each transfer and servicing agreement. This summary is subject to, and qualified in its entirety by reference to, all the provisions of the transfer and servicing agreements relating to a particular series. You should read the forms of the transfer and servicing agreements filed as noted above.

Sale and Assignment of Contracts by Seller

Harley-Davidson Credit Corp. will be the seller of the contracts and the related property to the depositor for deposit into the trust. The seller will acquire (i) the contracts originated by Eaglemark Savings Bank pursuant to a participation agreement and (ii) the contracts originated by the motorcycle dealers throughout the United States, pursuant to dealer agreements.

On or before the applicable closing date, the seller will sell to the depositor under a transfer and sale agreement all of its interest in the following:

•: the contracts and the right to receive all scheduled payments and prepayments received on the contracts after the applicable cutoff date, but excluding any scheduled payments due on or after, but received on or prior to, the applicable cutoff date;
•: security interests in the financed motorcycles securing the contracts and any related property;
•: the rights to proceeds from claims on theft, physical damage, credit life and disability insurance policies and debt cancellation agreements covering the financed motorcycles or the obligors;
•: certain rebates of premiums and other amounts relating to insurance policies, extended service contracts or other repair agreements and other items financed under the contracts; and
•: all proceeds of the foregoing.

Transfer of Contracts by the Depositor

Pursuant to a sale and servicing agreement, on the applicable closing date, the depositor will transfer to the trust all of its interest in the following:

•: all property acquired by the depositor from the seller under the transfer and sale agreement;
•: amounts that may be held in separate trust accounts maintained by the trustee or indenture trustee for the trust, including any reserve fund or interest reserve account;

•: the depositor's rights against the seller under the transfer and sale agreement pursuant to which the seller sold the pool of contracts to the depositor; and
•: all proceeds of the foregoing.

The depositor will designate the servicer as custodian to maintain physical possession, as the trust's agent, of the conditional sales contracts and promissory note and security agreements and any other documents relating to the contracts. To facilitate servicing and save administrative costs, the contracts will not be stamped or otherwise marked to reflect the sale and assignment of the contracts to the trust and the documents will not be physically segregated from other similar documents that are in the servicer's possession. However, UCC financing statements will be filed in the applicable jurisdictions reflecting:

•: the sale and assignment of the contracts and the security interests in the financed motorcycles by the originators to the seller;
•: the sale and assignment of the contracts and the security interests in the financed motorcycles and the related property by the seller to the depositor;
•: the transfer of the contracts, the security interests in the financed motorcycles, the related property and the depositor's rights against the seller under the transfer and sale agreement; and
•: the pledge by the trust of the trust assets to the indenture trustee.

The seller and servicer's accounting records and computer systems will also reflect these assignments and the pledge. Because the contracts will remain in the servicer's possession, if a subsequent purchaser were able to take physical possession of the contracts without knowledge of the assignment, the trust's interest in the contracts could be defeated. In addition, in some cases, the trust's security interest in collections that have been received by the servicer but not yet remitted to the related collection account could be defeated. See "Legal Aspects of the Contracts—Security Interests" in this prospectus.

The depositor will cause the trustee and the indenture trustee, if any, concurrently with the depositor's transfer and assignment of the contracts and related property to the trust, to execute and deliver the related notes to the depositor. The depositor will apply the net proceeds received from the sale of the notes of a given series to the purchase of the contracts from the seller and, to the extent specified in your prospectus supplement, to make any required initial deposit into the reserve fund and the interest reserve account, if any.

Conveyance of Contracts

On the closing date:

•: the seller will sell, transfer, assign, set over and otherwise convey the initial contracts and related assets to the depositor;
•: the depositor will sell, transfer, assign, set over and otherwise convey to the trust all right, title and interest in the initial contracts and related assets; and
•: the trust will pledge to the indenture trustee all right, title and interest in the initial contracts and related assets.

The initial contracts will be described on a list delivered to the trustee and the indenture trustee. Such list will include the amount of monthly payments due on each initial contract as of the initial cutoff date, the contractual rate of interest on each contract and the maturity date of each contract. Such list will be available for inspection by any securityholder at the principal office of the servicer. Shortly after the conveyance of the initial contracts to the trust, a servicing officer will have completed

a review of all the documents that the seller has customarily kept on file relating to the contracts, including the certificates of title to, or other evidence of a perfected security interest in, the related motorcycles, and confirmed the accuracy of the list of initial contracts delivered to the trustee and the indenture trustee. The depositor will deliver to the trustee and the indenture trustee, a report of a nationally recognized independent public accounting firm which states that such firm has performed specific procedures for a sample of the initial contracts supplied by the seller. Any contract discovered not to agree with such list in a manner that is materially adverse to the interests of the noteholders will be required to be repurchased by the seller, or, if the discrepancy relates to the unpaid principal balance of a contract, the seller may deposit cash in the collection account in an amount sufficient to offset such discrepancy.

In addition to the initial contracts, the trust's assets will include the trust's rights under the sale and servicing agreement in respect of the depositor's obligation to purchase from the seller, and concurrently convey to the trust, subsequent contracts purchased as of the applicable subsequent cutoff date. Any conveyance of subsequent contracts will be subject to the satisfaction of certain conditions including:

•: each such subsequent contract satisfies the eligibility criteria specified in the transfer and sale agreement and the related subsequent purchase agreement executed thereunder;
•: the depositor shall have delivered certain opinions of counsel to the trustee and the indenture trustee, the underwriters and the rating agencies with respect to the validity and other aspects of the conveyance of all such subsequent contracts; and
•: the rating agencies shall have each notified the depositor and the trustee and the indenture trustee in writing that the ratings on the notes will not be lowered following the addition of such subsequent contracts.

Representations and Warranties Made by the Seller and the Depositor

In the transfer and sale agreement the seller will make certain representations and warranties in the transfer and sale agreement to the depositor and in the sale and servicing agreement the depositor will make certain representations and warranties, in each case, with respect to each contract, including that (references to the closing date below being deemed, in respect of subsequent contracts, to refer to the date such subsequent contracts are transferred to the depositor):

•: the information provided about the contracts is true, complete and correct in all material respects;
•: each of the contracts is free and clear of all security interests, liens, charges, and encumbrances (such representation and warranty will be made to the best of its knowledge with respect to mechanic's liens and the like relating to each financed motorcycle) and no setoffs, defenses, or counterclaims against it have been asserted or threatened;
•: each of the contracts is or will be secured by a first priority perfected security interest in the financed motorcycle in favor of Eaglemark Savings Bank or Harley-Davidson Credit Corp.;
•: each contract represents the legal, valid and binding payment obligation of the obligor;
•: no contract has been satisfied, subordinated, or rescinded;
•: no right of rescission, setoff, counterclaim, or defense has been asserted or threatened with respect to any contract;
•: no event permitting acceleration under the terms of any contract has occurred, except for payment defaults continuing for a period of not more than thirty days as of the applicable cutoff date;

•: each contract constitutes "tangible chattel paper" as defined in the Uniform Commercial Code;
•: there is only one original executed copy of each contract; and
•: each contract, at the time it was originated, complied, and at the date of issuance of the securities or at the applicable date of any subsequent transfer of contracts, if any, complies in all material respects with applicable federal, state and local laws, and regulations thereunder, including consumer credit, truth in lending, equal credit opportunity and disclosure laws.

The seller will also make certain representations and warranties with respect to the contracts in the aggregate as set forth in your prospectus supplement.

In the event of a breach of any representation or warranty with respect to a contract that materially and adversely affects the trust's or any noteholder's interest in the contract or the collectibility of the contract, the depositor will be obligated to repurchase the contract from the trust and the seller will be obligated to repurchase the contract from the depositor. Any such purchase shall be made two business days prior to the first payment date after the last day of the calendar month in which the servicer, the trustee or the indenture trustee becomes aware and gives notice to the depositor or the seller of the breach or the depositor or the seller becomes aware of the breach at a price equal to the required payoff amount of the contract. The trustee or the indenture trustee may enforce this purchase obligation on your behalf, and will constitute your sole remedy available against the depositor or the seller for any uncured breach of its representations and warranties in the sale and servicing agreement and the transfer and sale agreement, except that the seller will indemnify the trust, the trustee, and the indenture trustee against losses, damages, liabilities and claims which may be asserted against any of them as a result of third-party claims arising out of the facts giving rise to that breach.

Upon the purchase by the seller of a contract, the indenture trustee, if any, the trust and the depositor will release the contract and its interest in the related financed motorcycle to the seller.

Collection Account

The indenture trustee will establish and maintain the collection account in the name of the indenture trustee for the benefit of the noteholders under the indenture.

The servicer will deposit the following amounts into the collection account no later than the second business day after processing by the servicer:

•: all payments made by the obligors under the contracts;
•: all proceeds of the contracts and the financed motorcycles; and
•: all payments made by the seller under the related transfer and sale agreement, or the depositor under the sale and servicing agreement to repurchase any contract as a result of a breach of a representation or warranty, as described under "—Representations and Warranties Made by the Seller and the Depositor" above.

However, if the conditions to making monthly deposits into the collection account set forth in the sale and servicing agreement (including the satisfaction of the minimum ratings of the servicer and the absence of a servicer default) are satisfied and if permitted by the rating agencies rating the securities, the servicer may retain collections received on the contracts during each month until the business day immediately prior to the related payment date. Pending deposit into the collection account, the servicer will not be obligated to segregate collections from its own funds and may use collections for its own benefit. To the extent set forth in your prospectus supplement, the servicer may, in order to satisfy the requirements set forth in the sale and servicing agreement obtain a letter of credit or other security for the benefit of the trust to secure timely remittances of collections on the contracts.

The servicer may withdraw from the collection account any amounts deposited in error or required to be repaid to an obligor, based on the servicer's good-faith determination that the amount was deposited in error or must be returned to the obligor.

Collections on a contract made during a month will be applied in the following order:

•: first, to accrued interest;
•: second, to pay any expenses and late or extension fees owing; and
•: third, to principal until the principal balance is brought current.

Any collections on a contract remaining after those applications will be considered an "excess payment". Excess payments constituting prepayments of principal will be applied as a prepayment of principal. All other excess payments will be held by the servicer.

Servicing

The servicer will be obligated under the sale and servicing agreement to service the contracts with reasonable care, using that degree of skill and attention that the servicer generally exercises with respect to all comparable motorcycle conditional sales contracts or promissory note and security agreements it services for itself and others in accordance with its credit and collection policies and applicable law. In performing these duties, the servicer shall comply in all material respects with its credit and collection policies and procedures described above under "The Seller and Servicer—Underwriting and Origination", as modified from time to time. The servicer may delegate servicing responsibilities to third parties or affiliates, provided that the servicer will remain obligated to the trust for the proper performance of its servicing responsibilities.

The servicer is responsible for:

•: reviewing the contract files in the normal course of business;
•: billing, collecting and recording payments from obligors;
•: communicating with and providing billing records to obligors;
•: depositing funds into the collection account;
•: issuing reports to the trustee and indenture trustee, if any, specified in the relevant transfer and servicing agreements;
•: repossessing and remarketing financed motorcycles following obligor defaults; and
•: paying the fees and ordinary expenses of a trust, the trustee and the indenture trustee.

The servicer is obligated to act in a commercially reasonable manner with respect to the repossession and disposition of financed motorcycles following a contract default with a view to realizing proceeds at least equal to the financed motorcycle's fair market value.

If the servicer determines that eventual payment in full of a contract is unlikely, the servicer will follow its normal practices and procedures to recover all amounts due upon that contract, including repossessing and disposing of the related financed motorcycle at a public or private sale, or taking any other action permitted by applicable law. See "Legal Aspects of the Contracts" in this prospectus. The servicer will be entitled to recover all reasonable out-of-pocket expenses incurred by it in liquidating a contract and disposing of the related financed motorcycle.

The servicer may, consistent with its customary servicing procedures, grant to the obligor on any contract an extension of payments due under such contract so long as such extension is consistent with the servicer's customary servicing procedures and with the sale and servicing agreement.

If so specified in your prospectus supplement, a "backup servicer" may be appointed and assigned certain oversight servicing responsibilities with respect to the contracts. The identity of any backup servicer, as well as a description of its responsibilities, of any fees payable to such backup servicer and the source of payment of such fees, will be included in your prospectus supplement.

Evidence as to Compliance

Annually the servicer will be obligated to deliver to the trustee and the indenture trustee, if any, a report from a nationally recognized accounting firm stating that the accounting firm has examined the servicer's internal controls over servicing and reporting of the contracts and issued an opinion on the effectiveness of the servicer's internal controls over servicing and reporting of the contracts.

Annually the servicer will be obligated to deliver to the trustee and the indenture trustee, if any, a certificate signed by an officer stating that the servicer has fulfilled its obligations under the sale and servicing agreement during the preceding twelve-month period in all material respects or, if there has been a default in the fulfillment of any obligation, describing such default.

You may obtain copies of these reports and certificates by delivering a request in writing to the trustee or the indenture trustee, as the case may be, at the address set forth in your prospectus supplement.

Servicer Default

A servicer default under the sale and servicing agreement will occur if:

•: the servicer fails to make any payment or deposit required under the securities, the sale and servicing agreement or the transfer and sale agreement and such failure continues for four business days after the date on which such payment or deposit was due;
•: the servicer fails to observe or perform in any material respect any covenant or agreement in the securities, the sale and servicing agreement or the transfer and sale agreement which continues unremedied for thirty days after the date on which such failure commences;
•: the servicer assigns its duties or rights under the sale and servicing agreement or the transfer and sale agreement, except as specifically permitted under the sale and servicing agreement or the transfer and sale agreement, or attempts to make such an assignment;
•: an involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect shall have been commenced against the servicer and shall not have been dismissed within 90 days, or a court having jurisdiction in the premises enters a decree or order for relief in respect of the servicer in an involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or appoints a receiver, liquidator, assignee, custodian, trustee or sequestrator (or similar official) of the servicer, or for any substantial liquidation of its affairs;
•: the servicer commences a voluntary case under any applicable bankruptcy, insolvency or similar law now or hereafter in effect, or consents to the entry of an order for relief in an involuntary case under any such law, or consents to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian or sequestrator (or other similar official) of the servicer or for any substantial part of its property or shall have made any general assignment for the benefit of creditors, or fails to, or admits in writing its inability to, pay its debts as they become due, or takes any corporate action in furtherance of the foregoing;
•: the failure of the servicer to deliver the monthly report pursuant to the terms of the sale and servicing agreement and such failure remains uncured for five business days after the date on which such failure commences; or

•: any representation, warranty or statement of the servicer made in the sale and servicing agreement or any certificate, report or other writing delivered pursuant to the sale and servicing agreement shall prove to be incorrect in any material respect as of the time when the same shall have been made and the incorrectness of such representation, warranty or statement has a material adverse effect on the trust and, within 30 days after written notice has been given to the servicer or the depositor by the trustee or the indenture trustee, the circumstances or condition in respect of which such representation, warranty or statement was incorrect have not been eliminated or otherwise cured.

The servicer will be required under the sale and servicing agreement to give the trustee and the indenture trustee, the rating agencies, the noteholders notice of an event of default promptly upon the occurrence of such event.

Rights upon Servicer Default

If a servicer default remains unremedied, the indenture trustee or the holders of more than 50% of the aggregate principal amount of the notes or the class or classes of notes described in your prospectus supplement may terminate all of the rights and obligations of the servicer under the sale and servicing agreement. When this happens, the indenture trustee, the trustee or a successor servicer selected by the indenture trustee or the trustee will succeed to all of the responsibilities, duties and liabilities of the servicer under the sale and servicing agreement.

If the indenture trustee or the trustee is unwilling or unable to act as the successor servicer, it may appoint, or petition a court to appoint, a successor servicer. The indenture trustee or the trustee may arrange for compensation to the successor servicer but that compensation may not exceed the base servicing fee payable to the servicer. Any successor servicer will not be liable for any acts or omissions of the prior servicer occurring prior to a transfer of the servicer's servicing and related functions or for any breach by the prior servicer of any of its obligations.

If a trust has notes outstanding, the holders of more than 50% of the aggregate principal amount of the notes or the class or classes of notes described in your prospectus supplement may waive any servicer default, other than a default in making any required deposits into the collection account.

Following an event of termination, the indenture trustee will terminate the lockbox agreement and direct all obligors under the contracts to make all payments under the contracts to the indenture trustee, or to a lockbox established by the indenture trustee.

Certain Matters Regarding the Servicer

The servicer may not resign from its obligations under the sale and servicing agreement except if its duties are no longer permissible under applicable law. No resignation will become effective until a successor servicer has assumed the servicer's obligations and duties under the sale and servicing agreement. Removal of the servicer is permissible only upon the occurrence of a servicer default as discussed above.

Each sale and servicing agreement will provide that neither the servicer nor any of its directors, officers, employees or agents will be under any liability to the trust or you for taking any action or for refraining from taking any action pursuant to that agreement or for errors in judgment; except that neither the servicer nor any person will be protected against any liability that would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of the servicer's duties under that agreement or by reason of reckless disregard of its obligations and duties under that agreement.

In addition, the servicer will not be obligated to appear in, prosecute or defend any legal action that is not incidental to the servicer's servicing responsibilities under the related sale and servicing agreement and that, in its opinion, may cause it to incur any expense or liability. The servicer may, however, undertake any reasonable action that it may deem necessary or desirable in respect of that agreement, the rights and duties of the parties thereto and the interests of the securityholders under that agreement. In that event, the legal expenses and costs of that action and any liability resulting therefrom will be expenses, costs and liabilities of the servicer, and the servicer will not be entitled to be reimbursed for such expenses costs and liabilities.

Under the circumstances specified in each sale and servicing agreement, any entity into which the servicer may be merged or consolidated, or any entity resulting from any merger or consolidation to which the servicer is a party, or any entity succeeding to all or substantially all of the business of the servicer will be the successor of the servicer under that agreement.

Servicing Compensation and Payment of Expenses

Compensation to the servicer will include a base monthly fee equal to:

•: the product of the percentage per annum specified in your prospectus supplement multiplied by the monthly principal balance of the contracts at the beginning of the month,

plus any

•: late fees;
•: prepayment charges, if any;
•: documentation fees;
•: extension fees and other administrative charges; and
•: if specified in your prospectus supplement, investment earnings on funds deposited in the trust accounts.

The servicer will pay all expenses incurred by it in connection with its activities under the transfer and servicing agreements and the annual fees and expenses of the trustee and the indenture trustee, if any. The servicer will be authorized to waive any administrative fees or extension fees that may be collected in the ordinary course of servicing any contract.

Statements to Trustees and the Trust

On or prior to each payment date the servicer will provide to the indenture trustee, if any, and the trustee a statement setting forth with respect to a series of securities substantially the same information that is required to be provided in the periodic reports to be provided to securityholders of that series described under "—Statements to Securityholders" below.

Statements to Securityholders

With respect to each series of securities, on or prior to each payment date, the servicer will prepare and provide to the indenture trustee a statement to be delivered to you on that payment date. Each statement will include the following information:

•: the amount of the payment allocable to the principal amount of each class of those notes;
•: the amount of the payment allocable to interest on each class of securities of that series;
•: the amount of the distribution allocable to the yield supplement deposit, if any;

•: the aggregate principal balance of the contracts as of the close of business on the last day of the preceding month;
•: the amount of base servicing fees paid to the servicer and fees payable to the trustee and the indenture trustee, if any;
•: the interest rate or pass-through rate for the interest period relating to the next succeeding payment date for any class of notes of that series with variable or adjustable rates;
•: the amount, if any, otherwise distributable to one or more subordinated classes of notes that has instead been distributed to more senior classes of notes on that payment date;
•: the outstanding principal amount and the note factor for each class of those notes after giving effect to all payments allocable to the principal of each class of notes on that date;
•: the amount of advances made by the servicer in respect of the related contracts for the preceding month and the amount of unreimbursed advances in respect of contracts determined by the servicer to be defaulted contracts during that month;
•: the balance of any related reserve fund, interest reserve account or other credit or liquidity enhancement on that date, after giving effect to changes thereto on that date and the amount of those changes;
•: during the funding period, the remaining amount on deposit in the pre-funding account on the last day of the preceding month;
•: the amount, if any, of any mandatory redemption payment;
•: the number and aggregate principal balance of contracts delinquent computed as of the end of the preceding month;
•: the number and aggregate principal balance of contracts that became liquidated contracts during the immediately preceding month, the amount of liquidation proceeds for such month, the amount of liquidation expenses being deducted from liquidation proceeds for such month, the net liquidation proceeds and the net liquidation losses for such month;
•: average and cumulative loss and delinquency information as of such payment date;
•: the number of contracts and the aggregate principal balance of such contracts, as of the first day of the immediately preceding month relating to such payment date and as of the last day of the immediately preceding month relating to such payment date (after giving effect to payments received during such month and to any transfers of subsequent contracts to the trust occurring on or prior to such payment date);
•: the aggregate principal balance and number of contracts that were repurchased by the depositor with respect to the immediately preceding month, identifying the purchase price for such contracts; and
•: such other customary factual information as is available to the servicer as the servicer deems necessary and can reasonably obtain from its existing data base to enable securityholders to prepare their tax returns.

You may obtain copies of the statements by delivering a request in writing addressed to the trustee or indenture trustee at its address set forth in your prospectus supplement.

Within the prescribed period of time for tax reporting purposes after the end of each calendar year during the term of a trust, the trustee or indenture trustee will mail to each person who at any time during that calendar year has been a securityholder with respect to that trust and received any payment

a statement containing information for the purposes of that securityholder's preparation of federal income tax returns. See "Material Federal Income Tax Consequences" in this prospectus.

Collections

With respect to the trust, the servicer will deposit all payments on the contracts (from whatever source) and all proceeds of such contracts collected during each collection period specified in your prospectus supplement into the collection account within two business days after receipt thereof unless otherwise provided in your prospectus supplement. The servicer is required to use its best efforts to cause an obligor to make all payments on the contracts to one or more lockbox banks (either directly by remitting payments to a lockbox, or indirectly by making payments through direct debit, the telephone or the internet to an account of the servicer which payments will be subsequently transferred from such account to one or more lockbox banks) acting as agent for the trust pursuant to a lockbox administration agreement. In addition, the servicer may in the future collect payments from obligors through other methods, including direct debit programs and the internet.

Advances

The servicer will be obligated to advance each month an amount equal to accrued and unpaid interest on any contract which was delinquent with respect to the immediately preceding month. However, the servicer will not be obligated to make an advance to the extent that it determines, in its sole discretion, that the advance will not be recovered from subsequent collections on or in respect of the related contract. The servicer will deposit any advances in the collection account no later than the day preceding the related payment date. The servicer will be entitled to recoup advances on a contract by means of a first priority withdrawal from the collection account.

All advances are reimbursable to the servicer, without interest, if and when a payment relating to a contract with respect to which an advance has previously been made is subsequently received. In addition, upon the determination by the servicer that a contract is a defaulted contract, it will be entitled to recover unreimbursed advances in respect of that contract from collections on or in respect of other contracts. A defaulted contract means a contract with respect to which there has occurred one or more of the following: (i) all or some portion of any payment under the contract is 120 days or more delinquent, (ii) repossession (and expiration of any redemption period) of a motorcycle securing a contract or (iii) the servicer has determined in good faith that an obligor is not likely to resume payment under a contract.

Net Deposits

As an administrative convenience and as long as specified conditions are satisfied, the servicer will be permitted to make the deposit of collections, aggregate advances and payments for purchases of contracts from the trust for or with respect to a month net of payments to be made to the servicer with respect to that month. The servicer may cause to be made a single, net transfer to the collection account. The servicer, however, will account to the trustee and you as if all deposits, payments and transfers were made individually.

List of Securityholders

Three or more holders of the notes of any class in a series or one or more holders of those notes of that class evidencing not less than 25% of the aggregate principal amount of those notes then outstanding may, by written request to the indenture trustee, obtain access to the list of all noteholders maintained by the indenture trustee for the purpose of communicating with other noteholders with respect to their rights under the indenture or under those notes. The indenture trustee may elect not to afford the requesting noteholders access to the list of noteholders if it agrees to mail the desired

communication or proxy, on behalf of and at the expense of the requesting noteholders, to all noteholders of that series.

The trustee will provide to the servicer within 15 days after receipt of a written request from the servicer, a list of the names of all noteholders of record as of the most recent applicable record date.

No transfer and servicing agreement will provide for the holding of annual or other meetings of securityholders.

Insolvency of Trust

Each trust agreement will provide that the trustee does not have the power to commence a voluntary proceeding in bankruptcy with respect to that trust without the unanimous prior approval of all certificateholders of that trust and the delivery to the trustee by each certificateholder of a certificate certifying that that certificateholder reasonably believes that that trust is insolvent.

Payment of Notes

Upon the payment in full of all outstanding notes issued by a trust and the satisfaction and discharge of the indenture, the trustee will succeed to all the rights of the indenture trustee, and the certificateholders of that series will succeed to all the rights of the noteholders of that series, under the sale and servicing agreement, except as otherwise provided in the sale and servicing agreement.

Administration Agreement

Harley-Davidson Credit Corp., in its capacity as administrator, will enter into an administration agreement with each trust that issues notes and the indenture trustee pursuant to which the administrator will agree to provide notices and perform other administrative obligations of the trust under the indenture. For its services under the administration agreement the administrator may be entitled to receive a monthly administration fee, which administration fee will be paid by the depositor. The amount of the administration fee, if any, will be set forth in your prospectus supplement.

Amendment

The parties may, without your consent, correct or supplement any provision in the transfer and servicing agreements that is ambiguous or inconsistent with any other provision in the transfer and servicing agreements, this prospectus or your prospectus supplement. In addition, the parties may amend any transfer and servicing agreement without the consent of any securityholder to add any provisions to or change in any manner or eliminate any of the provisions of a transfer and servicing agreement if the indenture trustee or trustee receives an opinion of counsel that the modification will not have a material adverse effect on the securityholders.

Any transfer and servicing agreement may also be amended in any respect by the parties with the consent of the holders of more than 50% of the aggregate principal amount of the notes or the class or classes of the notes described in your prospectus supplement issued by the trust, except that no amendment:

•: that reduces the amount or changes the timing of any collections on any contracts or payments required to be distributed on any security;
•: that changes the interest rate on any security, that adversely affects the priority of payment of principal or interest to the securityholders; or
•: that reduces the percentage of securityholders required to consent to these amendments or any waiver under the transfer and servicing agreement,

may be effective without the consent of the holder of each security. Also, an amendment under the foregoing sentence will not be effective unless each rating agency rating the securities confirms that the amendment will not result in a reduction, qualification or withdrawal of the ratings on the securities.

Termination

The obligations of the servicer, the depositor, the trustee and indenture trustee pursuant to the trust agreement, the sale and servicing agreement or indenture will terminate upon the earlier to occur of (i) the maturity or other liquidation of the last contract and the disposition of any amounts received upon liquidation of any property remaining in the trust, or (ii) the payment to all securityholders of all amounts required to be paid to them pursuant to the indenture and the trust agreement; provided, however, in no event shall the trust continue beyond the expiration of 21 years from the death of the last survivor of the descendants of Joseph P. Kennedy, the late Ambassador of the United States to the Court of St. James, living on the closing date. The seller's representations, warranties and indemnities will survive any termination of the sale and servicing agreement. Upon termination, amounts in the collection account, if any, will be paid to the depositor.

The trustee and the indenture trustee will give written notice of termination to each securityholder of record. The final distribution to you will be made only upon surrender and cancellation of your notes at the office or agency of the trustee or the indenture trustee specified in the notice of termination. Any funds remaining in the trust, after the trustee or the indenture trustee has taken certain measures to locate you and such measures have failed, will be distributed to the depositor.

Legal Aspects of the Contracts

General

The transfer of the contracts to the trust, the perfection of the security interests in the contracts and the enforcement of rights to realize on the motorcycles as collateral for the contracts are subject to a number of federal and state laws and, with respect to Canadian contracts, Canadian laws. Uniform Commercial Code ("UCC") financing statements in the United States will be filed in the applicable jurisdictions reflecting the transfer or pledge of the contracts and the security interests in the motorcycles and the related property by the seller to the depositor and by the depositor to the trust and by the trust to the indenture trustee. A person could acquire an interest in a contract that is superior to that of the trust or the indenture trustee because the servicer will retain possession of the contracts and the contracts will not be stamped or otherwise marked to indicate that the contracts have been transferred to the trust. If a person purchases contracts, or takes a security interest therein, for value in the ordinary course of its business and obtains possession of the contracts without actual knowledge of the trust's or indenture trustee's interest, that person will acquire an interest in the contracts superior to the interest of the trust or the indenture trustee. To the extent provided in your prospectus supplement, a trust that holds its interest in Canadian contracts indirectly through one or more notes, certificates, participations or other interests issued to the trust by a Canadian special purpose entity will be secured by such contracts held by Canadian special purpose entity.

Security Interests

General

In jurisdictions in which the contracts evidence the credit sale of new and used motorcycles by motorcycle dealers to obligors, the contracts also constitute personal property security agreements. Such contracts, and the promissory note and security agreements originated by Eaglemark Savings Bank, include grants of security interests in the motorcycles under the applicable UCC in the United States and the applicable Personal Property Security Act or the equivalent thereof ("PPSA") in each applicable province and territory of Canada. Perfection of security interests in financed motorcycles is

generally governed by the laws of the jurisdiction in which the motorcycle is located. In most states in the United States, a security interest in a motor vehicle is perfected by obtaining possession of the certificate of title to the motor vehicle or notation of the secured party's lien on the motor vehicle's certificate of title. In Canada, PPSA financing statements are filed against the obligor on the related contract in order to perfect the security interests in the financed motorcycles.

All contracts acquired by the seller from the originators will name the seller as obligee or assignee and as the secured party. The seller will also take all actions necessary under the laws of the jurisdiction in which the related financed motorcycle is located to perfect its security interest in that financed motorcycle, including, where applicable, having a notation of its lien recorded on the related certificate of title and/or obtaining possession of that certificate of title and/or filing financing statements. Because Harley-Davidson Credit Corp. will continue to service the contracts as servicer under the sale and servicing agreement the obligors on the contracts will not be notified of the sale from the seller to the depositor or the sale from the depositor to the related trust or the pledge by the trust to the indenture trustee.

Perfection

The seller will sell and assign its security interest in the financed motorcycles to the depositor and the depositor will assign its security interest in the financed motorcycles to the trust and the trust will assign its security interest in the financed motorcycles to the indenture trustee. However, because of the administrative burden and expense, none of the seller, the depositor or the related trust will amend any certificate of title to identify the trust or indenture trustee as the new secured party on that certificate of title relating to a financed motorcycle. However, UCC financing statements with respect to the transfer to the depositor of the seller's security interest in the financed motorcycles and the transfer to the trust of the depositor's security interest in the financed motorcycles and the transfer to the indenture trustee of the trust's security interest in the financed motorcycles will be filed. In addition, the servicer will continue to hold any certificates of title relating to the financed motorcycles in its possession as custodian for each trust. See "Description of the Transfer and Servicing Agreements" in this prospectus.

In most states, an assignment is an effective conveyance of a security interest without amendment of any lien noted on a motor vehicle's certificate of title. In most Canadian jurisdictions, the failure to record an assignment by the secured party of its interest therein does not diminish the effectiveness of the PPSA registrations. Although re-registration of the motor vehicle is not necessary to convey a perfected security interest in the financed motorcycles to the trust or the indenture trustee, because neither the trust nor the indenture trustee will be listed as lienholder on the certificates of title or any financing statements, the security interest of the trust or the indenture trustee in the motorcycle could be defeated through fraud, forgery, negligence or error. In the absence of fraud or forgery by the motorcycle owner or the servicer or administrative error by state or local agencies, the notation of the seller's lien on the certificates of title will be sufficient to protect the trust and the indenture trustee against the rights of subsequent purchasers of a financed motorcycle or subsequent lenders who take a security interest in a financed motorcycle. With respect to Canadian contracts, the effectiveness and priority of the interest of the trust and the indenture trustee in the motorcycles will be dependent upon the effectiveness and priority of the PPSA registrations made by the seller against such motorcycles. The seller and depositor will each represent and warrant that the seller has a perfected security interest in each financed motorcycle. If there are any financed motorcycles as to which the seller failed to obtain a perfected security interest, the security interest of the trust and the indenture trustee would be subordinate to, among others, subsequent purchasers of the financed motorcycles and holders of perfected security interests in the financed motorcycles. To the extent that such failure has a material and adverse effect on the trust's, the indenture trustee's or any securityholder's interest in the related contract or the collectibility of the contract, however, it would constitute a breach of the warranties of

the seller and the depositor. Accordingly, the depositor would be required to repurchase the related contract from the trust and the seller will be required to repurchase that contract from the depositor, unless the breach was cured. The depositor will assign to the trust its rights to cause the seller to repurchase that contract under the related transfer and sale agreement and the trust will pledge to the indenture trustee its rights to cause the depositor to repurchase that contract under the related sale and servicing agreement. See "Description of the Transfer and Servicing Agreements" and "Risk Factors—Interests of other persons in the contracts or the financed motorcycles could reduce the funds available to make payments on your securities" in this prospectus.

Continuity of Perfection

Under the laws of most states, the perfected security interest in a vehicle would continue for four months after the motor vehicle is moved to a state that is different from the one in which it is initially registered and thereafter until the owner re-registers the motor vehicle in the new state. A majority of states generally require surrender of a certificate of title to re-register a motor vehicle. In those states, such as California, that require a secured party to hold possession of the certificate of title to maintain perfection, the secured party would learn of the re-registration through the request from the obligor under the related contract to surrender possession of the certificate of title. In the case of motor vehicles registered in states providing for the notation of a lien on the certificate of title but not possession by the secured party, such as Texas, the secured party would receive notice of surrender from the state of re-registration if the security interest is noted on the certificate of title. Thus, the secured party would have the opportunity to re-perfect its security interest in the vehicle in the state of relocation. However, these procedural safeguards will not protect the secured party if through fraud, forgery or administrative error, the obligor somehow procures a new certificate of title that does not list the secured party's lien. Additionally, in states that do not require a certificate of title for registration of a motor vehicle, re-registration could defeat perfection. In the ordinary course of servicing the contracts, the servicer will take steps to effect re-perfection upon receipt of notice of re-registration or information from the obligor as to relocation. Similarly, when an obligor sells a financed motorcycle, the servicer must surrender possession of the certificate of title or will receive notice as a result of its lien noted on the certificate of title and accordingly will have an opportunity to require satisfaction of the related contract before release of the lien. The servicer will be obligated to take appropriate steps, at the servicer's expense, to maintain perfection of security interests in the financed motorcycles and will be obligated to purchase the related contract if it fails to do so and that failure has a material and adverse effect on the trust's or any securityholder's interest in the contract or the collectibility of the contract.

Priority of Liens Arising by Operation of Law

Under the laws of most states, liens for repairs performed on a motor vehicle and liens for unpaid taxes take priority over even a perfected security interest in a financed motorcycle. The Internal Revenue Code also grants priority to specified federal tax liens over the lien of a secured party. The laws of some states and federal law permit the confiscation of motor vehicles by governmental authorities under some circumstances if used in unlawful activities, which may result in the loss of a secured party's perfected security interest in the confiscated vehicle. The seller will represent and warrant to the depositor and the depositor will represent and warrant to the trust that, to its knowledge, as of the related closing date, each security interest in a financed motorcycle is prior to all other present liens upon and security interests in that financed motorcycle. However, liens for repairs or taxes could arise, or the confiscation of a financed motorcycle could occur, at any time during the term of a contract. No notice will be given to trustee, indenture trustee or you if a lien arises or confiscation occurs that would not give rise to the depositor's or seller's obligation to repurchase such contract. In Canada, certain liens for, among other things, repairs and unpaid taxes may also in certain circumstances take priority over a perfected security interest in a financed motorcycle.

Repossession

In the event of default by an obligor, the holder of the related contract has all the remedies of a secured party under the UCC, except where specifically limited by other state laws. Among the UCC remedies, the secured party has the right to perform repossession by self-help means, unless it would constitute a breach of the peace or is otherwise limited by applicable state law. Unless a motorcycle financed by the seller is voluntarily surrendered, self-help repossession is the method employed by the servicer in most states and is accomplished simply by retaking possession of the financed motorcycle. In cases where an obligor objects or raises a defense to repossession, or if otherwise required by applicable state law, a court order must be obtained from the appropriate state court, and the motorcycle must then be recovered in accordance with that order. In some jurisdictions, the secured party is required to notify the obligor of the default and the intent to repossess the collateral and to give that obligor a time period within which to cure the default prior to repossession. In some states, an obligor has the right to reinstate its contract and recover the collateral by paying the delinquent installments or other amounts due. In Canada, in the event of a default by an obligor, the secured party has, in addition to its contractual remedies, all the remedies of a secured party under the applicable PPSA and is also subject to certain obligations imposed by the applicable PPSA, such as the obligation to act in a commercially reasonable manner. These remedies include the right to take possession and dispose of the collateral.

Notice of Sale; Redemption Rights

The UCC and other state laws require the secured party to provide an obligor with reasonable notice of the date, time and place of any public sale and/or the date after which any private sale of the collateral may be held. In most states, an obligor has the right to redeem the collateral prior to actual sale by paying the secured party the unpaid principal balance of the obligation, accrued interest on the obligation plus reasonable expenses for repossessing, holding and preparing the collateral for disposition and arranging for its sale, plus, in some jurisdictions, reasonable attorneys' fees. In some states, an obligor has the right to redeem the collateral prior to actual sale by payment of delinquent installments or the unpaid balance. Under Canadian law, most provinces require that the obligor and certain other persons with an interest in the collateral be notified of the disposition of the collateral and be given a period of time within which they may satisfy the obligation secured by the collateral prior to actual sale of the collateral by paying the secured party the unpaid balance of the obligation plus the secured party's expenses for repossessing, holding and preparing the collateral for disposition.

Deficiency Judgments and Excess Proceeds

The proceeds of resale of the motor vehicle generally will be applied first to the expenses of resale and repossession and then to the satisfaction of the indebtedness. While some states impose prohibitions or limitations on deficiency judgments if the net proceeds from resale do not cover the full amount of the indebtedness, a deficiency judgment can be sought in those states that do not prohibit or limit those judgments. In addition to the notice requirement described above, the UCC requires that every aspect of the sale or other disposition, including the method, manner, time, place and terms, be "commercially reasonable." Generally, courts have held that when a sale is not "commercially reasonable," the secured party loses its right to a deficiency judgment. However, the deficiency judgment would be a personal judgment against the obligor for the shortfall, and a defaulting obligor can be expected to have very little capital or sources of income available following repossession. Therefore, in many cases, it may not be useful to seek a deficiency judgment or, if one is obtained, it may be settled at a significant discount or be uncollectible. In addition, the UCC permits the obligor or other interested party to recover for any loss caused by noncompliance with the provisions of the UCC. Also, prior to a sale, the UCC permits the obligor or other interested person to prohibit the secured

party from disposing of the collateral if it is established that the secured party is not proceeding in accordance with the "default" provisions under the UCC.

Occasionally, after resale of a repossessed vehicle and payment of all expenses and indebtedness, there is a surplus of funds. In that case, the UCC requires the creditor to remit the surplus to any holder of a subordinate lien with respect to that vehicle or if no lienholder exists, the UCC requires the creditor to remit the surplus to the obligor. The applicable PPSA requires that any surplus be paid to persons having a subordinate security interest in collateral or an interest in the surplus, and otherwise to the obligor or any other person known by the secured party to be an owner of such collateral.

Certain Bankruptcy Considerations

The depositor has taken steps that are intended to make it unlikely that the voluntary or involuntary application for relief by the seller under the United States Bankruptcy Code or similar applicable state laws will result in consolidation of the assets and liabilities of the depositor with those of the seller. These steps include the creation of the depositor as a wholly-owned, limited purpose subsidiary pursuant to articles of incorporation and bylaws containing restrictions on the nature of the depositor's business and on its ability to commence a voluntary case or proceeding under any insolvency law without the unanimous affirmative vote of all of its directors. In addition, to the extent that the seller granted a security interest in the contracts to the depositor, and that interest was validly perfected before the bankruptcy or insolvency of the seller and was not taken or granted in contemplation of insolvency or with the intent to hinder, delay or defraud the seller or its creditors, that security interest should not be subject to avoidance, and payments to the trust with respect to the contracts should not be subject to recovery by a creditor or trustee in bankruptcy of the seller.

However, delays in payments on the securities and possible reductions in the amount of those payments could occur if:

1.: a court were to conclude that the assets and liabilities of the depositor should be consolidated with those of the seller in the event of the application of applicable insolvency laws to the seller, as the case may be;
2.: a filing were made under any insolvency law by or against the depositor; or
3.: an attempt were to be made to litigate any of the foregoing issues.

On each closing date, Winston & Strawn LLP will give an opinion to the effect that, based on a reasoned analysis of analogous case law, although there is no precedent based on directly similar facts, and, subject to facts, assumptions and qualifications specified in the opinion and applying the principles set forth in the opinion, in the event of a voluntary or involuntary bankruptcy case in respect of the seller under Title 11 of the United States Bankruptcy Code at a time when the seller was insolvent, the property of the seller would not properly be substantively consolidated with the assets of the depositor. Among other things, that opinion will assume that each of the depositor and the seller will follow specified procedures in the conduct of its affairs, including maintaining records and books of account separate from those of the other, refraining from commingling its assets with those of the other, and refraining from holding itself out as having agreed to pay, or being liable for, the debts of the other. The depositor and the seller intend to follow these and other procedures related to maintaining their separate identities. However, there can be no assurance that a court would not conclude that the assets and liabilities of the depositor should be consolidated with those of the seller.

The seller will represent and warrant that the sale of the related contracts to the depositor is a valid sale. Notwithstanding the foregoing, if the seller were to become a debtor in a bankruptcy case, a court could take the position that the sale of contracts to the depositor should instead be treated as a pledge of those contracts to secure a borrowing of the seller. If a court were to reach such conclusions, or a filing were made under any insolvency law by or against the depositor, or if an attempt were made

to litigate any of the foregoing issues, delays and possible reduction in payments on the securities could occur. In addition, if the transfer of contracts to the depositor is treated as a pledge instead of a sale, a tax or government lien on the property of the seller arising before the transfer of a contract to the depositor may have priority over the depositor's interest in that contract.

The seller and the depositor will treat the transactions described in this prospectus as a sale of the contracts to the depositor, so that the automatic stay provisions of the United States Bankruptcy Code should not apply to the contracts if the seller were to become a debtor in a bankruptcy case.

Furthermore, if a motorcycle dealer or the seller became a debtor in a bankruptcy case, creditors of that party, or that party acting as debtor-in-possession, may assert that the transfer of the contracts was ineffective to remove the contracts from that party's estate. In that case, the distribution of payments on the contracts to the trust might be subject to the automatic stay provisions of the United States Bankruptcy Code. This would delay the distribution of those payments to you for an uncertain period of time. Furthermore, reductions in payments under the contracts to the trust may result if the bankruptcy court rules in favor of the creditors or the debtor-in-possession. In either case, you may experience delays or reductions in distributions or payments to you. In addition, a bankruptcy trustee would have the power to sell the contracts if the proceeds of the sale could satisfy the amount of the debt deemed owed by the motorcycle dealer or the seller, as the case may be. The bankruptcy trustee could also substitute other collateral in lieu of the contracts to secure the debt. Additionally, the bankruptcy court could adjust the debt if the motorcycle dealer or the seller were to file for reorganization under Chapter 11 of the United States Bankruptcy Code. Any of these actions could result in losses or delays in payments on your securities. Each of the motorcycle dealers and the seller will represent and warrant that the conveyance of the contracts by it is in each case a valid sale and transfer of the contracts.

Also, cash collections on the contracts may be commingled with general funds of the servicer and, in the event of a bankruptcy of the servicer, a court may conclude that the trust does not have a perfected security interest in those collections.

Eaglemark Savings Bank is organized as a Nevada corporation and is regulated and supervised by the Department of Business and Industry Financial Institutions Division which is authorized to appoint the FDIC as a conservator or receiver for Eaglemark Savings Bank if specified events occur relating to Eaglemark Savings Bank's financial condition or the propriety of its actions. In addition, the FDIC could appoint itself as conservator or receiver for Eaglemark Savings Bank.

By statute, the FDIC as conservator or receiver is authorized to repudiate any "contracts" of Eaglemark Savings Bank upon payment of "actual direct compensatory damages." This authority may be interpreted by the FDIC to permit it to repudiate the transfer of contracts to the seller. Under an FDIC regulation, however, the FDIC as conservator or receiver will not reclaim, recover or recharacterize a bank's transfer of financial assets if certain conditions are met, including that the transfer qualifies for sale accounting treatment, was made for adequate consideration and was not made fraudulently, in contemplation of insolvency, or with the intent to hinder, delay or defraud the bank or its creditors. We believe the FDIC regulation will apply to the transfer of contracts to the seller and intend on satisfying the conditions of the regulation. If a condition required under the FDIC regulation, or other statutory or regulatory requirement applicable to the transactions, were found not to have been satisfied, the FDIC as conservator or receiver might refuse to recognize Eaglemark Savings Bank's transfer of contracts to the seller. In that case, distribution of payments on the contracts to the trust may be delayed and possibly reduced. Also, the FDIC could require the trust and securityholders to comply with the administrative claims procedure established by the FDIC to establish their rights to payments on the contracts, could request a stay of any actions to enforce the participation agreement (pursuant to which the seller purchases the contracts from Eaglemark Savings Bank) against Eaglemark Savings Bank, or could repudiate the participation agreement and limit claims

of the trust and securityholders to "actual direct compensatory damages." Additionally, the trust could be limited to seeking recovery based upon the obligation of the seller to repurchase contracts for which it did not have good and marketable title. Any of these actions could result in losses or delays in payments on your securities.

Consumer Protection Laws

Numerous federal and state consumer protection laws and related regulations impose substantial requirements upon lenders and servicers involved in consumer finance. These laws include the Truth-in-Lending Act, the Equal Credit Opportunity Act, the Federal Trade Commission Act, the Fair Credit Billing Act, the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Magnuson-Moss Warranty Act, the Federal Reserve Board's Regulations B and Z, the Servicemembers Civil Relief Act, the Texas Consumer Credit Code, the Telemarketing and Consumer Fraud and Abuse Prevention Act, state adaptations of the National Consumer Act and of the Uniform Consumer Credit Code, state unfair or deceptive practices acts and state motor vehicle retail installment sales acts and other similar laws. Also, state laws impose finance charge ceilings and other restrictions on consumer transactions and require contract disclosures in addition to those required under federal law. These requirements impose specific statutory liabilities upon creditors who fail to comply with their provisions. In some cases, this liability could affect an assignee's ability to enforce consumer finance contracts such as the contracts.

The so-called "Holder-in-Due-Course" Rule of the Federal Trade Commission (the "FTC Rule"), the provisions of which are generally duplicated by the Uniform Consumer Credit Code, other statutes or the common law in some states, has the effect of subjecting a seller (and specified creditors and their assignees) in a consumer credit transaction to all claims and defenses that the obligor in the transaction could assert against the seller of the goods. Liability under the FTC Rule is limited to the amounts paid by the obligor under the contract, and the holder of the contract may also be unable to collect any balance remaining due under that contract from the obligor.

Most of the contracts will be subject to the requirements of the FTC Rule. Accordingly, a trust, as holder of the related contracts, will be subject to any claims or defenses that the purchaser of the applicable financed motorcycle may assert against the seller of the related financed motorcycle. As to each obligor, these claims are limited to a maximum liability equal to the amounts paid by the obligor on the related contract. Under most state motor vehicle dealer licensing laws, sellers of motorcycles are required to be licensed to sell motorcycles at retail sale. Furthermore, federal odometer regulations promulgated under the Motor Vehicle Information and Cost Savings Act require that all sellers of new and used motorcycles furnish a written statement signed by the seller certifying the accuracy of the odometer reading. If the motorcycle dealer is not properly licensed or if a written odometer disclosure statement was not provided to the purchaser of the related financed motorcycle, an obligor may be able to assert a defense against the motorcycle dealer. If an obligor were successful in asserting any of those claims or defenses, that claim or defense would constitute a breach of the depositor's representations and warranties under the related sale and servicing agreement and a breach of the seller's warranties under the related transfer and sale agreement and would, if the breach materially and adversely affects the collectibility of the contract or the interests of the trust or the securityholders in the contract, create an obligation of the depositor and the seller, respectively, to repurchase the contract unless the breach is cured. See "Description of the Transfer and Servicing Agreements" in this prospectus.

Courts have applied general equitable principles to secured parties pursuing repossession and litigation involving deficiency balances. These equitable principles may have the effect of relieving an obligor from some or all of the legal consequences of a default.

In several cases, consumers have asserted that the self-help remedies of secured parties under the UCC and related laws violate the due process protections provided under the 14th Amendment to the Constitution of the United States. Courts have generally upheld the notice provisions of the UCC and related laws as reasonable or have found that the repossession and resale by the creditor do not involve sufficient state action to afford constitutional protection to borrowers.

The seller and the depositor will represent and warrant that each contract complies with all requirements of law in all material respects. Accordingly, if an obligor has a claim against a trust for violation of any law and that claim materially and adversely affects that trust's or the securityholder's interest in a contract or the collectibility of the contract, that violation would constitute a breach of the representations and warranties of the seller and the depositor would create an obligation of the seller and the depositor to repurchase the contract unless the breach is cured. See "Description of the Transfer and Servicing Agreements" in this prospectus.

Other Limitations

In addition to the laws limiting or prohibiting deficiency judgments, numerous other statutory provisions, including federal bankruptcy laws and related state laws and, to the extent applicable, Canadian bankruptcy and insolvency laws, may interfere with or affect the ability of a secured party to realize upon collateral or to enforce a deficiency judgment. For example, in a Chapter 13 proceeding under the United States Bankruptcy Code, a court may prevent a creditor from repossessing a vehicle and, as part of the rehabilitation plan, reduce the amount of the secured indebtedness to the market value of the vehicle at the time of bankruptcy, as determined by the court, leaving the creditor as a general unsecured creditor for the remainder of the indebtedness. A bankruptcy court may also reduce the monthly payments due under a contract or change the rate of interest and time of repayment of the indebtedness.

Under the terms of the Servicemembers Civil Relief Act (the "Relief Act"), an obligor who enters the military service after the origination of that obligor's contract (including an obligor who is a member of the National Guard or is in reserve status at the time of the origination of the obligor's contract and is later called to active duty) may not be charged interest above an annual rate of 6% during the period of that obligor's active duty status, unless a court orders otherwise upon application of the lender. In addition, some states, including California, allow members of its national guard to extend payments on any contract obligation if called into active service by the Governor for a period exceeding 7 days. It is possible that the foregoing could have an effect on the ability of the servicer to collect the full amount of interest owing on some of the contracts. In addition, both the Relief Act and the laws of some states, including California, New York and New Jersey, impose limitations that would impair the ability of the servicer to repossess the released financed motorcycle during the obligor's period of active duty status. Thus, if that contract goes into default, there may be delays and losses occasioned by the inability to exercise the trust's rights with respect to the contract and the related financed motorcycle in a timely fashion.

Any shortfall, to the extent not covered by amounts payable to the securityholders from amounts on deposit in the related reserve fund or from coverage provided under any other credit enhancement mechanism, could result in losses to the securityholders.

Material Federal Income Tax Consequences

General

The following is a general discussion of certain material United States federal income tax consequences of the purchase, ownership and disposition of notes issued by the trust as described in this prospectus. Winston & Strawn LLP has delivered its opinion letter with respect to the federal income tax characterization of the trust and the notes to be issued by the trust.

The opinions of Winston & Strawn LLP and this discussion of "Material Federal Income Tax Consequences" are based upon current provisions of the Internal Revenue Code of 1986, as amended (the "Code"), existing and proposed Treasury Regulations promulgated thereunder, current administrative rulings, judicial decisions and other applicable authorities in effect as of the date hereof, all of which are subject to change, possibly with retroactive effect. There are no cases, regulations, or Internal Revenue Service ("IRS") rulings on similar transactions involving instruments issued by an issuer with terms similar to those of the trust and the notes. An opinion of counsel does not foreclose the possibility of a contrary determination by the IRS or by a court of competent jurisdiction, or of a contrary position by the IRS or Treasury Department in regulations or rulings issued in the future. As a result, there can be no assurance that the IRS will not challenge the conclusions reached herein, and no ruling from the IRS has been or will be sought on any of the issues discussed below. The trust will not be indemnified for any federal income tax that may be imposed upon it, and the imposition of any such taxes on the trust could result in a reduction in the amounts available to distribute to the noteholders. Furthermore, legislative, judicial or administrative changes may occur, perhaps with retroactive effect, which could affect the accuracy of the statements and conclusions set forth herein as well as the tax consequences to noteholders.

This discussion does not attempt to deal with all aspects of federal income taxation that may be relevant to all holders of notes in light of their personal investment or tax circumstances. Also, this discussion does not describe tax consequences to certain types of holders who may be subject to special treatment under the federal income tax laws including, without limitation, financial institutions, dealers in securities or currencies, insurance companies, tax-exempt organizations, and persons who hold the notes as part of a straddle, hedging or conversion transaction.

Investors and preparers of tax returns (including returns filed by the trust described in this prospectus) should be aware that under applicable Treasury Regulations a provider of advice on specific issues of law is not considered an income tax return preparer unless the advice (1) is given with respect to events that have occurred at the time the advice is rendered and is not given with respect to the consequences of contemplated actions, and (2) is directly relevant to the determination of an entry on a tax return. Accordingly, taxpayers should consult their own tax advisors and tax return preparers regarding the preparation of any item on a tax return even where the anticipated tax treatment has been discussed in this prospectus.

The tax opinions of Winston & Strawn LLP with respect to the trust and the notes to be issued by the trust which have been delivered in connection with the filing of this prospectus are subject to certain assumptions, conditions and qualifications as described in detail below. At the time a trust is established and notes are issued, Winston & Strawn LLP will deliver another opinion letter, regarding the same tax issues, to either confirm the accuracy of those assumptions or conditions or to address any changes or differences which may exist at that time. To the extent any given series of notes, or the form of any trust, differs from the assumptions or conditions set forth in the following discussion or changes occur in the relevant tax laws, or in their application, any additional tax considerations will be disclosed in your prospectus supplement.

PROSPECTIVE INVESTORS SHOULD CONSULT WITH THEIR OWN TAX ADVISORS AS TO THE FEDERAL, STATE, LOCAL, FOREIGN AND ANY OTHER TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE NOTES.

Tax Characterization of the Trust

Winston & Strawn LLP, as federal tax counsel to the depositor, is of the opinion that the trust will not be an association (or a publicly traded partnership) taxable as a corporation for federal income tax purposes and therefore its income will not be subject to the federal income tax imposed by Subtitle A of the Code at the entity level. This opinion is based on the assumptions that the terms of the trust agreement and related documents will be substantially in the form filed in connection with this prospectus and will be complied with. It is also assumed that the depositor, or other owner of the equity interest issued by the trust, will take all action necessary, if any, or refrain from taking any inconsistent action so as to ensure the trust is, for federal income tax purposes, disregarded as a separate entity from the depositor (or other sole equity owner).

Because the equity interest issued by the trust is at all times required to be owned by a single person, such as the depositor, for federal income tax purposes the trust will be disregarded as a separate entity from the owner of its equity interest. Although it is the opinion of Winston & Strawn LLP that the notes issued by the trust will be characterized as indebtedness for federal income tax purposes (as discussed below), no assurance can be given that this characterization of the notes will prevail. If the IRS successfully asserted that one or more of the notes did not constitute debt for federal income tax purposes, the notes might be treated as equity interests in the trust. As a result, even though the equity interest issued by the trust is at all times owned by a single person, the trust would be considered to have multiple equity owners (rather than just the single owner of the equity interest). In that case, the trust would be characterized as a partnership for federal income tax purposes and the tax consequences to the trust and to holders of notes which were recharacterized as equity would be as generally described below under "—Other Possible Characterizations of the Notes and the Trust".

Although the trust's income will not be subject to entity level tax for U.S. federal income tax purposes, if the trust acquires contracts which were originated in any jurisdiction other than the United States, withholding taxes may be imposed by the foreign jurisdiction on the payments made with respect to such contracts. In that event, the cash flow available to the trust for distributions on the notes would be reduced. The depositor does not currently anticipate that the trust will acquire contracts subject to withholding taxes imposed by foreign jurisdictions. In the event that a trust expects to acquire a material number of contracts originated outside of the United States, any potential adverse tax consequences will be discussed in your prospectus supplement.

Tax Treatment of Investors in the Notes

Treatment of the Notes as Indebtedness. Winston & Strawn LLP, as federal tax counsel, is of the opinion that the notes will be characterized as debt for federal income tax purposes. This opinion is based upon the assumption that the terms of the trust agreement, the indenture, the notes and the related documents will be substantially in the form filed in connection with this prospectus and will be complied with. The depositor and the owners of the notes, by their purchase of notes, will agree to treat the notes as debt for federal, state and local income and franchise tax purposes. Winston & Strawn LLP's opinion also assumes that the terms and delinquency experience with respect to the contracts as described in this prospectus will remain substantially unchanged and that the terms of the notes will be as contemplated by this prospectus.

Except where indicated to the contrary, the following discussion assumes that the notes will be treated as indebtedness for federal income tax purposes. The following discussion is also based in part upon Treasury Regulations interpreting the original issue discount provisions of the Code. The original issue discount regulations, however, are subject to varying interpretations and do not address all issues that would affect noteholders.

Interest on the Notes. An investor will be taxed on the amount of payments of interest on a note as ordinary interest income at the time it accrues or is received in accordance with the investor's regular method of accounting for United States federal income tax purposes. This treatment assumes that all payments on the notes are denominated in U.S. dollars. It also assumes that the payment of interest on the notes constitutes "qualified stated interest" (as described below) under Treasury Regulations relating to original issue discount and that an investor does not acquire its notes as stripped notes or at an original issue discount as discussed below. If these assumptions are incorrect with respect to any notes issued by a trust, additional tax considerations with respect to those notes will be disclosed in the related prospectus supplement.

A holder of a note that has a fixed maturity date of not more than one year from the issue date of that note (which will be referred to in this paragraph as a "short-term note") may be subject to special rules. An accrual basis holder of a short-term note (and some cash method holders, including regulated investment companies, as set forth in Section 1281 of the Code) generally would be required to report interest income as interest accrues on a straight-line basis or under a constant-yield method over the term of each interest period. Other cash basis holders of a short-term note would, in general, be required to report interest income as interest is paid (or, if earlier, upon the taxable disposition of the short-term note). However, a cash basis holder of a short-term note reporting interest income as it is paid may be required to defer a portion of any interest expense otherwise deductible on indebtedness incurred to purchase or carry the short-term note until the taxable disposition of the short-term note. A cash basis taxpayer may elect under Section 1281 to accrue interest income on all nongovernment debt obligations with a term of one year or less, in which case the taxpayer would not be subject to the interest expense deferral rule referred to in the preceding sentence. Special rules apply if a short-term note is purchased for more or less than its principal amount.

Original Issue Discount ("OID"). Based upon Winston & Strawn LLP's interpretation of (i) the definition of "qualified stated interest" and (ii) other provisions of the OID Code sections and regulations, it is not expected that any of the notes will be issued with OID (i.e., any excess of the stated redemption price of the notes over their issue price), other than perhaps with a de minimis amount (i.e., ¹/4 of the notes' stated redemption price at maturity multiplied by the number of full years to maturity). However, if notes were issued at a discount from their principal amounts or if the stated interest was not treated as qualified stated interest, the notes would be treated as having OID. Under the OID regulations currently in effect, in order to have qualified stated interest, the stated interest must be unconditionally payable in cash or property at least once annually. Interest is unconditionally payable only if reasonable legal remedies exist to compel timely payment or the debt instrument otherwise provides terms and conditions that make the likelihood of late payment (other than a late payment that occurs within a reasonable grace period) or nonpayment a remote contingency. The depositor believes that the likelihood of late payment or nonpayment of the stated interest on the notes should constitute a remote contingency; the IRS, however, may disagree. In addition, the IRS may take the position that noteholders do not have available default remedies ordinarily available to holders of debt instruments. In such case, the stated interest on the notes would not be qualified stated interest and the notes would be considered to have been issued with OID.

If the notes are in fact issued with a greater than de minimis amount of OID or are otherwise treated as having been issued with OID, the following rules should apply. The excess of the stated redemption price at maturity of a note (generally equal to its principal amount as of the date of issuance plus all interest other than qualified stated interest payable prior to or at maturity) over the original issue price (in this case, the initial offering price at which a substantial amount of the notes are sold other than to a bond house, broker or similar person acting as an underwriter, placement agent or wholesaler) will constitute OID. A noteholder must include OID in income as interest over the term of the note under a constant yield method. OID generally must be included in income in advance of the receipt of cash representing that income regardless of whether the noteholder reports taxable income on the cash or accrual method. In general, the amount of OID included in income is the sum of the

daily portions of the OID with respect to the note for each day during the taxable year the noteholder held the note. The daily portion generally is determined by allocating to each day in an accrual period a ratable portion of the OID allocable to such accrual period. The amount of OID allocable to an accrual period is generally equal to the difference between (i) the product of the note's adjusted issue price and its yield to maturity and (ii) the amount of qualified stated interest payments allocable to such accrual period. The adjusted issue price of an OID note at the beginning of any accrual period is the sum of its issue price plus the amount of OID allocable to prior accrual periods minus the amount of prior payments that were not qualified stated interest.

Alternatively, because the payments on the notes may be accelerated by reason of prepayments on the receivables, OID, other than de minimis OID, on the notes, if any, may have to be accrued under Code section 1272(a)(6), which allocates OID to each day in an accrual period by taking the ratable portion of the excess of (i) the sum of the present value of the remaining payments on a note as of the close of the accrual period and the payments made during the accrual period that were included in stated redemption price at maturity, over (ii) the adjusted issue price of the note at the beginning of the accrual period. No regulations have been issued under Code section 1272(a)(6) so it is not clear if such section would apply to the notes if they are treated as having OID. Accordingly, each noteholder should consult its own tax advisor regarding the impact of the OID rules if the notes are issued with OID.

A holder of a note issued with de minimis OID must include such OID in income proportionately as principal payments are made on such note.

Acquisition Premium. A holder that purchases in a secondary market a note that was originally issued with OID for an amount less than or equal to the sum of all amounts payable on the note after the purchase date other than payments of qualified stated interest but in excess of its adjusted issue price (any such excess being "acquisition premium") and that does not make the election described below under "Election to Treat All Interest as Original Issue Discount" is permitted to reduce the daily portions of OID, if any, by a fraction, the numerator of which is the excess of the holder's adjusted basis in the note immediately after its purchase over the adjusted issue price of the note, and the denominator of which is the excess of the sum of all amounts payable on the note after the purchase date, other than payments of qualified stated interest, over the note's adjusted issue price.

Market Discount. Whether or not the notes are issued with OID, a subsequent purchaser (i.e., a purchaser who acquires a note not at the time of original issue) of a note at a discount will be subject to the market discount rules of section 1276 of the Code. In general, these rules provide that if the holder of a note purchases the note at a "market discount" (i.e., a discount from its original issue price plus any accrued OID that exceeds a de minimis amount specified in the Code) and thereafter recognizes gain upon a disposition, the lesser of (i) such gain or (ii) the accrued market discount will be taxed as ordinary income. Generally, the accrued market discount will be the total market discount on the note multiplied by a fraction, the numerator of which is the number of days the holder held the note and the denominator of which is the number of days from the date the holder acquired the note until its maturity date. The holder may elect, however, to determine accrued market discount under the constant yield method. The adjusted basis of a note subject to such election will be increased to reflect market discount included in gross income, thereby reducing any gain or increasing any loss on a subsequent sale or taxable disposition. Each holder of an interest in a note should consult with its own tax advisors as to the effect of making this election.

Limitations imposed by the Code which are intended to match deductions with the taxation of income will defer deductions for interest on indebtedness incurred or continued, or short-sale expenses incurred, to purchase or carry a note with accrued market discount. A noteholder who elects to include market discount in gross income as it accrues, however, is exempt from this rule.

Amortizable Bond Premium. In general, if a purchaser acquires a note at a premium (i.e., an amount in excess of the amount payable upon the maturity thereof), such noteholder will be considered to have purchased the note with "amortizable bond premium" equal to the amount of such excess. A noteholder may elect to deduct the amortizable bond premium as it accrues under a constant yield method over the remaining term of the note. Accrued amortized bond premium may only be used as an offset against qualified stated interest income when such income is included in the holder's gross income under the holder's normal accounting system. If the noteholder does not make such an election, the premium paid for the note generally will be included in the tax basis of the note in determining the gain or loss on its disposition.

Election to Treat All Interest as Original Issue Discount. A holder may elect to include in gross income all interest that accrues on a note using the constant yield method described above under the heading "—Original Issue Discount ("OID")", with modifications described below. For purposes of this election, interest includes stated interest, OID, de minimis OID, market discount, de minimis market discount and unstated interest, as adjusted by any amortizable bond premium or acquisition premium. In applying the constant yield method to a note with respect to which this election has been made, the issue price of the note will equal the electing holder's adjusted basis in the note immediately after its acquisition, the issue date of the note will be the date of its acquisition by the electing holder, and no payments on the note will be treated as payments of qualified stated interest. This election, if made, may not be revoked without the consent of the IRS. Each holder of an interest in a note should consult with its own tax advisors as to the effect of making this election in light of their individual circumstances.

Sale or Other Disposition of a Note. An investor who disposes of a note, whether by sale, exchange for other property, or payment by the trust, will recognize taxable gain or loss equal to the difference between the amount realized on the sale or other disposition, not including any amount attributable to accrued but unpaid interest which will be taxable as such, and the investor's adjusted tax basis in the note. In general, an investor's adjusted tax basis in a note will be equal to the investor's initial purchase price increased by any accrued OID or market discount previously included in income by the investor and decreased by the amount of any bond premium previously amortized and the amount of any payments, other than payments of stated interest, previously received by the investor with respect to the note. Any gain or loss recognized upon the sale or other disposition of a note will be capital gain or loss so long as the note is a capital asset in the hands of the investor. For non-corporate investors, capital gain recognized on the sale or other disposition of a note held by the investor for more than one year will be taxed at a maximum rate of 15% (20% for taxable years beginning after December 31, 2008). Capital gain for a note held for one year or less is taxed at the rates applicable to ordinary income. Taxpayers must aggregate capital gains and losses for each taxable year. In the event a taxpayer realizes a net capital loss for any year there are limitations on the amount of these capital losses which can be deducted.

Information Reporting and Backup Withholding

The indenture trustee will be required to report annually to the IRS and to each noteholder the amount of interest paid on the notes (and the amount withheld for federal income taxes, if any) for each calendar year, except as to certain exempt recipients (generally, corporations, tax-exempt organizations, qualified pension and profit-sharing trusts, individual retirement accounts, or nonresident aliens who provide certification as to their status). Each holder (other than holders who are not subject to the reporting requirements) will be required to provide, under penalties of perjury, a certificate (generally, Form W-9) containing the holder's:

(1): name,
(2): address,

(3): correct federal taxpayer identification number, and
(4): statement that the holder is not subject to backup withholding.

Should a non-exempt noteholder fail to provide the required certification, the indenture trustee will be required to withhold (or cause to be withheld) 28% of the interest otherwise payable to the holder, and remit the withheld amounts to the IRS as a credit against the holder's federal income tax liability.

Tax Consequences to Foreign Investors

Special tax rules apply to the purchase of notes by foreign persons. For U.S. tax purposes, foreign investors include any person who is not

(1) a citizen or resident of the United States,

(2) a corporation, partnership or other business entity treated as such created or organized in or under the laws of the United States, any state or political subdivision thereof or the District of Columbia,

(3) an estate the income of which is includible in gross income for U.S. federal income tax purposes, regardless of its source,

(4) a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons have the authority to control all substantial decisions of the trust, or

(5) a trust that has a valid election in effect under applicable United States Treasury Regulations to be treated as a United States person.

If a partnership (including for this purpose any entity treated as a partnership for federal income tax purposes) is a beneficial owner of a note, the treatment of a partner in the partnership will generally depend upon the status of the partner and upon the activities of the partnership. A noteholder that is a partnership and partners in such partnership should consult their tax advisors about the federal income tax consequences of holding and disposing of a note, as the case may be.

Interest paid or accrued to a foreign investor holding a note on its own behalf that is not effectively connected with the conduct of a trade or business within the United States by the investor will generally be considered portfolio interest and not be subject to United States federal income tax or withholding tax as long as the foreign investor is not actually or constructively a 10 percent shareholder of the trust or a controlled foreign corporation related to the trust through stock ownership or a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business. Additionally, the foreign investor must provide or have a financial institution provide on its behalf to the trust or paying agent an appropriate statement (Form W-8BEN or successor form), that is signed under penalties of perjury, certifying that the beneficial owner of the note is a foreign person and providing that foreign person's name and address. Additional reporting requirements may apply to interest payments made to a foreign investor that is not an individual or corporation (or an entity treated as a corporation for federal income tax purposes) holding the note on its own behalf. If the information provided in this statement changes, the foreign investor must provide a new Form W-8BEN (or successor form) within 30 days. If the foreign investor fails to satisfy these requirements so that interest on the investor's notes was not portfolio interest, interest payments would be subject to United States federal income and withholding tax at a rate of 30% unless reduced or eliminated under an applicable income tax treaty. To qualify for any reduction as the result of an income tax treaty, the foreign investor must provide the paying agent with Form W-8BEN (or successor form).

The realization of any capital gain on the sale or other taxable disposition of a note by a foreign investor will be exempt from United States federal income and withholding tax, provided that (1) the

gain is not effectively connected with the conduct of a trade or business in the United States by the investor, and (2) in the case of an individual foreign investor, the investor is not present in the United States for 183 days or more during the taxable year. If an individual foreign investor is present in the U.S. for 183 days or more during the taxable year, the gain on the sale or other disposition of the notes could be subject to a 30% withholding tax unless reduced by treaty.

If the interest, gain or income on a note held by a foreign investor is effectively connected with the conduct of a trade or business in the United States by the investor, the noteholder will be subject to United States federal income tax on the interest, gain or income at regular federal income tax rates. At the same time, the noteholder may be exempt from withholding tax if a Form W-8ECI (or successor form) is furnished to the paying agent. In addition, if the foreign investor is a foreign corporation, it may be subject to a branch profits tax equal to 30% of its effectively connected earnings and profits for the taxable year, as adjusted for certain items, unless it qualifies for a lower rate under an applicable tax treaty.

As previously described under the heading "—Information Reporting and Backup Withholding", if a foreign investor fails to provide necessary documentation to the trust or its paying agent regarding the investor's taxpayer identification number or certification of exempt status, a 28% backup withholding tax may be applied to note payments to that investor. Any amounts withheld under the backup withholding rules will be allowed as a refund or a credit against the foreign investor's U.S. federal income tax liability provided the required information is furnished to the IRS.

Other Possible Characterizations of the Notes and the Trust

Although, as discussed above, it is the opinion of Winston & Strawn LLP that the notes will be characterized as indebtedness for federal income tax purposes, the IRS may take a contrary position. If the IRS were to contend successfully that any class or series of notes were not debt for federal income tax purposes, such notes might be treated as equity interests in the trust. As a result, even though the depositor (or other single person) was the sole equity owner of the trust, the trust would be considered to have multiple equity owners and might be classified for federal income tax purposes as an association taxable as a corporation or as a partnership. A partnership is generally not subject to an entity level tax for federal income tax purposes, while an association or corporation is subject to an entity level tax.

If the trust were treated as a partnership (which is not a publicly traded partnership taxable as a corporation) and one or more classes of notes were treated as equity interests in that partnership, each item of income, gain, loss, deduction, and credit generated through the ownership of the receivables by the partnership would be passed through to the partners, including the affected noteholders, according to their respective interests therein. Under current law, the income reportable by noteholders as partners in such a partnership could differ from the income reportable by the noteholders as holders of debt. Generally, such differences are not expected to be material; however, certain noteholders may have adverse tax consequences. For example, cash basis noteholders might be required to report income when it accrues to the partnership rather than when it is received by the noteholder. Any income allocated to a noteholder that is a tax-exempt entity may constitute unrelated business taxable income. All noteholders would be taxed on the partnership income regardless of when distributions are made to the noteholders. An individual noteholder's ability to deduct the noteholder's share of partnership expenses would be subject to the 2% miscellaneous itemized deduction floor. A foreign investor in the notes might be required to file a United States individual or corporate income tax return, as the case may be, and would be subject to tax (and withholding at the top marginal rate, currently 35%) on its share of partnership income at regular United States rates including, in the case of a corporation, the branch profits tax.

If, alternatively, the trust were treated as either an association taxable as a corporation or a publicly traded partnership taxable as a corporation, the trust would be subject to federal income taxes

at corporate tax rates on its taxable income generated by ownership of the receivables. Moreover, distributions by the trust to all or some of the classes of noteholders would probably not be deductible in computing the trust's taxable income and all or part of the distributions to noteholders would probably be treated as dividends. Such an entity-level tax could result in reduced distributions to noteholders and the noteholders could be liable for a share of such tax. To the extent distributions on such notes were treated as dividends, a foreign investor would generally be subject to tax (and withholding) on the gross amount of such dividends at a rate of 30% unless reduced or eliminated pursuant to an applicable income tax treaty.

ERISA Considerations

Section 406 of the Employee Retirement Income Security Act of 1974, as amended ("ERISA") and Section 4975 of the Code prohibit a pension, profit-sharing or other employee benefit plan, as well as individual retirement accounts and some types of Keogh Plans (each a "Benefit Plan"), from engaging in transactions involving "plan assets" with persons that are "parties in interest" under ERISA or "disqualified persons" under the Code with respect to that Benefit Plan. A violation of these "prohibited transaction" rules may result in an excise tax or other penalties and liabilities under ERISA and the Code for those persons. Employee benefit plans that are governmental plans (as defined in Section 3(32) of ERISA) and some church plans (as defined in Section 3(33) of ERISA) are not subject to ERISA requirements nor to Section 4975 of the Code. However, governmental plans may be subject to state or local laws that impose similar requirements. In addition, governmental plans and church plans that are "qualified" under Section 401(a) of the Code are subject to restrictions with respect to prohibited transactions under Section 503(a)(1)(B) of the Code, the sanction for violation being loss of "qualified" status.

Certain exemptions from the prohibited transaction rules could be applicable to the purchase and holding of securities by a Benefit Plan depending on the type and circumstances of the plan fiduciary making the decision to acquire the securities. Potentially available exemptions would include, without limitation, Prohibited Transaction Class Exemption ("PTCE") 90-1, which exempts certain transactions involving insurance company pooled separate accounts; PTCE 95-60, which exempts certain transactions involving insurance company general accounts; PTCE 91-38, which exempts certain transactions involving bank collective investment funds; PTCE 84-14, which exempts certain transactions effected on behalf of a plan by a "qualified professional asset manager"; and PTCE 96-23, which exempts certain transactions effected on behalf of a plan by an "in-house asset manager." Insurance company general accounts should also discuss with their legal counsel the availability of exemptive relief under Section 401(c) of ERISA. A purchaser of securities should be aware, however, that even if the conditions specified in one or more exemptions are met, the scope of the relief provided by the applicable exemption or exemptions might not cover all acts that might be construed as prohibited transactions.

ERISA also imposes certain duties on persons who are fiduciaries of Benefit Plans subject to ERISA, including the requirements of investment prudence and diversification, and the requirement that such a Benefit Plan's investments be made in accordance with the documents governing the Benefit Plan. Under ERISA, any person who exercises any authority or control respecting the management or disposition of the assets of a Benefit Plan is considered to be a fiduciary of such Benefit Plan. Benefit Plan fiduciaries must determine whether the acquisition and holding of securities and the operations of the trust would result in prohibited transactions if Benefit Plans that purchase the securities were deemed to own an interest in the underlying assets of the trust under the rules discussed below. There may also be an improper delegation of the responsibility to manage Benefit Plan assets if Benefit Plans that purchase the securities are deemed to own an interest in the underlying assets of the trust.

Some transactions involving a trust might be deemed to constitute prohibited transactions under ERISA and the Code with respect to a Benefit Plan that purchased notes if assets of the trust were deemed to be assets of the Benefit Plan. Under a regulation issued by the United States Department of Labor (the "Plan Assets Regulation"), the assets of a trust would be treated as plan assets of a Benefit Plan for the purposes of ERISA and the Code only if the Benefit Plan acquired an "equity interest" in the trust and none of the exceptions contained in the Plan Assets Regulation was applicable. An equity interest is defined under the Plan Assets Regulation as an interest other than an instrument which is treated as indebtedness under applicable local law and which has no substantial equity features. The likely treatment in this context of notes of a given series will be discussed in your prospectus supplement.

Certificates Issued by Trusts

Unless otherwise specified in your prospectus supplement, the following discussion applies only to certificates with investment-grade ratings issued by a trust.

The U.S. Department of Labor (the "DOL") has granted to the lead underwriter named in your prospectus supplement an exemption (the "Exemption") from certain of the prohibited transaction rules of ERISA with respect to the initial purchase, the holding and the subsequent resale by Benefit Plans of certificates representing interests in asset-backed pass-through trusts that consist of certain receivables, loans and other obligations that meet the conditions and requirements of the Exemption. The receivables covered by the Exemption include fully-secured motor vehicle installment sales contracts and promissory notes and security agreements like those contained in the trust. The Exemption may apply to the acquisition, holding and resale of the certificates by a Benefit Plan, provided that certain conditions (certain of which are described below) are met.

Among the conditions which must be satisfied for the Exemption to apply to the certificates are the following:

(1) The acquisition of the certificates by a Benefit Plan is on terms (including the price for the certificates) that are at least as favorable to the Benefit Plan as they would be in an arm's length transaction with an unrelated party;

(2) The certificates acquired by the Benefit Plan have received a rating at the time of such acquisition that is in one of the four highest generic rating categories from Standard & Poor's Rating Services, a division of The McGraw-Hill Companies, Inc., Moody's Investors Service, Inc. or Fitch, Inc.;

(3) The trustee is not an affiliate of any other member of the Restricted Group (as defined below) other than an underwriter;

(4) The sum of all payments made to and retained by the underwriters in connection with the distribution of the certificates represents not more than reasonable compensation for underwriting the certificates; the sum of all payments made to and retained by the seller pursuant to the sale of the receivables to the trust represents not more than the fair market value of such receivables; and the sum of all payments made to and retained by any servicer represents not more than reasonable compensation for that servicer's services under the sale and servicing agreement or pooling and servicing agreement and reimbursement of the servicer's reasonable expenses in connection therewith; and

(5) The Benefit Plan investing in certificates is an "accredited investor" as defined in Rule 501(a)(1) of Regulation D of the Securities and Exchange Commission under the Securities Act of 1933.

On July 21, 1997, the DOL published in the Federal Register an amendment to the Exemption, which extends exemptive relief to certain mortgage-backed and asset-backed securities transactions using pre-funding accounts for trusts issuing pass-through certificates. The amendment generally allows mortgage loans or other secured receivables supporting payments to certificateholders, and having a value equal to no more than twenty-five percent (25%) of the total principal amount of the certificates being offered by the trust, to be transferred to the trust within a 90-day or three-month period following the closing date, instead of requiring that all such receivables be either identified or transferred on or before the closing date. The relief is available when the pre-funding account satisfies certain conditions.

The Exemption would also provide relief from certain self-dealing/conflict of interest prohibited transactions that may occur when the fiduciary (or its affiliate) is an obligor on receivables held in the trust only if, among other requirements, (i) in the case of the acquisition of certificates in connection with the initial issuance, at least fifty (50) percent of each class of certificates in which Benefit Plans invest and at least fifty (50) percent of the aggregate interest in the trust are acquired by persons independent of the Restricted Group (as defined below), (ii) such fiduciary (or its affiliate) is an obligor with respect to five (5) percent or less of the fair market value of the obligations contained in the trust, (iii) the Benefit Plan's investment in certificates of any class does not exceed twenty-five (25) percent of all of the certificates of that class outstanding at the time of the acquisition, and (iv) immediately after the acquisition, no more than twenty-five (25) percent of the assets of any Benefit Plan with respect to which the fiduciary has discretionary authority or renders investment advice are invested in certificates representing an interest in one or more trusts containing assets sold or serviced by the same entity. This relief is not available to fiduciaries of Benefit Plans sponsored by the seller, any underwriter, the trustee, any servicer, any obligor with respect to receivables included in the trust constituting more than five percent of the aggregate unamortized principal balance of the assets in the trust, any counterparty to an eligible swap agreement included in the trust, or any affiliate of, such parties (the "Restricted Group").

Your prospectus supplement for each series of securities will indicate the classes of securities, if any, offered thereby to which it is expected that the Exemption will apply.

Due to the complexities of the "prohibited transaction" rules and the penalties imposed upon persons involved in prohibited transactions, it is important that the fiduciary of any Benefit Plan considering the purchase of securities consult with its tax and/or legal advisors regarding whether the assets of the related trust would be considered plan assets, the possibility of exemptive relief from the prohibited transaction rules and other issues and their potential consequences. Moreover, each Benefit Plan fiduciary should determine whether, under the general fiduciary standards of investment prudence and diversification, an investment in the securities is appropriate for the Benefit Plan, taking into account the overall investment policy of the Benefit Plan and the composition of the Benefit Plan's investment portfolio.

Ratings of the Securities

No trust will sell securities under this prospectus unless one or more nationally recognized statistical rating organizations rate the offered securities in one of the four highest rating categories. Any rating that is made may be lowered or withdrawn by the assigning rating agency at any time if, in its judgment, circumstances so warrant. If a rating or ratings of securities is qualified, reduced or withdrawn, no person or entity will be obligated to provide any additional credit enhancement with respect to the securities so qualified, reduced or withdrawn.

The ratings of the securities should be evaluated independently from similar ratings on other types of securities. A rating is not a recommendation to buy, sell or hold securities, inasmuch as a rating does not comment as to market price or suitability for a particular investor. The ratings of the

securities do not address the likelihood of payment of principal on any class of securities prior to the stated maturity date of the securities, or the possibility of the imposition of United States withholding tax with respect to non-United States persons.

Plan of Distribution

Each trust may sell securities to or through underwriters by a negotiated firm commitment underwriting and public reoffering by the underwriters, and also may sell securities directly to other purchasers or through agents. The depositor intends to offer the securities through these various methods from time to time.

The seller, the depositor and certain of its affiliates may agree to indemnify the underwriters and agents who participate in the distribution of the securities against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or contribute to payments the underwritten may be required to make.

Funds in cash collateral accounts and the trust accounts may, from time to time, be invested in certain investments acquired from the underwriters.

Legal Matters

Winston & Strawn LLP, Chicago, Illinois, will provide a legal opinion relating to the securities in its capacity as special counsel to the trust, the depositor, the seller and the servicer. In addition, certain United States federal income tax matters will be passed upon for the related trust by Winston & Strawn LLP. Other legal matters for the underwriters will be passed upon by counsel to the underwriters.

Where You Can Find More Information

Federal securities law requires the filing of certain information with the Securities and Exchange Commission, including annual, quarterly and special reports, proxy statements and other information. You can read and copy these documents at the public reference room maintained by the Securities and Exchange Commission at 450 Fifth Street, NW., Washington, DC, 20549. Please call the Securities and Exchange Commission at 1-800-SEC-0330 for more information about the public reference room or visit Securities and Exchange Commission's web site at http://www.sec.gov to access available filings.

The Securities and Exchange Commission allows offerors of securities to incorporate by reference some of the information they file with it. This means that offerors can disclose important information to you by referring you to those documents. Documents incorporated by reference will be filed under the depositor's name. The information that the depositor incorporates by reference is considered to be part of this prospectus, and later information that the depositor files with the Securities and Exchange Commission will automatically update and supersede this information.

All documents filed by the administrator, on behalf of the trust, or the depositor under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, after the date of this prospectus and prior to the termination of the offering of the securities will be incorporated by reference into this prospectus.

If you are a beneficial owner of the securities to whom a prospectus has been delivered, the depositor will, on request, send you a copy of the information that has been incorporated by reference in this prospectus. The depositor will provide this information at no cost to you. Please address requests to the depositor: c/o Harley-Davidson Credit Corp., Suite 3100, 150 South Wacker Drive, Chicago, Illinois 60606.

PART II

Information Not Required In Prospectus

Item 14. Other Expenses of Issuance and Distribution

The following is an itemized list of the estimated expenses to be incurred in connection with the offering of the securities being offered hereunder other than underwriting discounts and commissions.

SEC Registration Fee	$	118
Printing and Engraving Expenses	$	50,000
Trustee's Fees and Expenses	$	12,500
Legal Fees and Expenses	$	150,000
Blue Sky Fees and Expenses	$	10,000
Accountants' Fees and Expenses	$	35,000
Rating Agency Fees	$	310,000
Miscellaneous Fees	$	50,000

Total	$	617,618

*: All amounts except the SEC Registration Fee are estimates of expenses incurred or to be incurred in connection with the issuance and distribution of the securities in an aggregate principal amount assumed for these purposes to be equal to $667,000,000 of securities registered hereby.

Item 15. Indemnification of Directors and Officers

The Nevada General Corporation Law gives Nevada corporations broad powers to indemnify their present and former directors and officers and those affiliated corporations against expenses incurred in the defense of any lawsuit to which they are made parties by reason of being or having been such directors or officers, subject to specified conditions and exclusions; gives a director or officer who successfully defends an action the right to be so indemnified; and authorizes said corporation to buy director's and officers' liability insurance. The registrant's articles of incorporation authorize the registrant to indemnify its officers and directors to the maximum extent permitted by the Nevada General Corporation Law; provided that any indemnification payments are limited to the extent of funds actually received by the registrant in excess of funds necessary to pay in full all outstanding securities rated by a nationally recognized rating agency. Such indemnification is not exclusive of any other right to which those indemnified may be entitled under any bylaw, agreement, vote of stockholders or otherwise.

The registrant has also purchased liability policies which indemnify the registrant's officers and directors against loss arising from claims by reason of their legal liability for acts as officers and directors, subject to limitations and conditions as set forth in the policies.

Pursuant to agreements which the registrant may enter into with underwriters or agents (forms of which will be included as exhibits to this registration statement), officers and directors of the registrant, and affiliates thereof, may be entitled to indemnification by such underwriters or agents against certain liabilities, including liabilities under the Securities Act of 1933, as amended, arising from information which has been or will be furnished to the registrant by such underwriters or agents that appears in the registration statement or any prospectus.

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Item 16. Exhibits

		Exhibits
1.1		Form of Underwriting Agreement for the Notes. Filed as Exhibit 1.1 to the Registration Statement No. 333-37550 and incorporated herein by reference.
3.1		Articles of Incorporation of the depositor. Filed as Exhibit 3.1 to the Registration Statement No. 333-37550 and incorporated herein by reference.
3.2		Bylaws of the depositor. Filed as Exhibit 3.2 to the Registration Statement No. 333-37550 and incorporated herein by reference.
4.1		Form of Trust Agreement between the depositor and the trustee (including form of certificate).
4.2		Form of Indenture between the trust and the indenture trustee (including form of notes).
5.1		Opinion of Winston & Strawn with respect to legality.
8.1		Opinion of Winston & Strawn with respect to tax matters.
10.1		Form of Transfer and Sale Agreement between the seller and the depositor.
10.2		Form of Sale and Servicing Agreement among the trust, the depositor, the servicer and the indenture trustee.
10.3		Form of Administration Agreement between the trust, the administrator, the depositor and the indenture trustee.
23.1		Consent of Winston & Strawn (included as part of Exhibit 5.1).
23.2		Consent of Winston & Strawn (included as part of Exhibit 8.1).
24.1		Powers of Attorney (included on signature page).
25.1		Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of indenture trustee*

*: To be filed pursuant to Section 305(b)(2) of the Trust Indenture Act at the time of an offering of debt securities.

Item 17. Undertakings

The undersigned registrant hereby undertakes:

(1)

To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i): To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
(ii): To reflect in the prospectus any facts or events arising after the effective date of this registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the

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maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; or

(iii): To include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in this registration statement.

(2): That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3): To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offer therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

That insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the act and will be governed by the final adjudication of such issue.

That, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act of 1933 shall be deemed to be part of this registration statement as of the time it was declared effective.

That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

The undersigned registrant hereby undertakes to file an application for the purpose of determining the eligibility of the indenture trustee to act under subsection (a) of Section 310 of the Trust Indenture Act (the "Act") in accordance with the rules and regulations prescribed by the Commission under Section 305(b)(2) of the Act.

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Signatures

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3, has reasonable grounds to believe that the security rating requirement set forth in the section captioned "Ratings of Securities" will be met by the time of sale of the securities and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Chicago, State of Illinois, on May 13, 2005.

		Harley-Davidson Customer Funding Corp.
		By:	/s/ DONNA F. ZARCONE
		Name:	Donna F. Zarcone
		Title:	President

Know all men by these presents, that each person whose signature appears below constitutes and appoints Perry A. Glassgow and Lawrence G. Hund and each of them, as his true and lawful attorney-in-fact and agent, with full powers of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, and to sign any registration statement for the same offering covered by this registration statement that is to be effective upon filing pursuant to Rule 462(b) promulgated under the Securities Act of 1933 (and all post-effective amendments thereto), and to file the same, with all exhibits thereto and all documents in connection therewith with the Securities and Exchange Commission granting to said attorney-in-fact power and authority to perform any other act on behalf of the undersigned required to be done in connection therewith.

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities indicated on May 13, 2005:

Signature		Title

/s/ DONNA F. ZARCONE Donna F. Zarcone		Director and President (Principal Executive Officer)
/s/ LAWRENCE G. HUND Lawrence G. Hund		Director and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
/s/ DONOVAN A. LANGFORD, III Donovan A. Langford, III		Director
/s/ PETER M. HUSTING Peter M. Husting		Director

EXHIBIT INDEX

1.1		Form of Underwriting Agreement for the Notes. Filed as Exhibit 1.1 to the Registration Statement No. 333-37550 and incorporated herein by reference.
3.1		Articles of Incorporation of the depositor. Filed as Exhibit 3.1 to the Registration Statement No. 333-37550 and incorporated herein by reference.
3.2		Bylaws of the depositor. Filed as Exhibit 3.2 to the Registration Statement No. 333-37550 and incorporated herein by reference.
4.1		Form of Trust Agreement between the depositor and the trustee (including form of certificate).
4.2		Form of Indenture between the trust and the indenture trustee (including form of notes).
5.1		Opinion of Winston & Strawn with respect to legality.
8.1		Opinion of Winston & Strawn with respect to tax matters.
10.1		Form of Transfer and Sale Agreement between the seller and the depositor.
10.2		Form of Sale and Servicing Agreement among the trust, the depositor, the servicer and the indenture trustee.
10.3		Form of Administration Agreement between the trust, the administrator, the depositor and the indenture trustee.
23.1		Consent of Winston & Strawn (included as part of Exhibit 5.1).
23.2		Consent of Winston & Strawn (included as part of Exhibit 8.1).
24.1		Powers of Attorney (included on signature page).
25.1		Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of indenture trustee*

*: To be filed pursuant to Section 305(b)(2) of the Trust Indenture Act at the time of an offering of debt securities.

QuickLinks

Introductory Note
Table of Contents Prospectus Supplement
Reading this prospectus supplement and the accompanying prospectus
Prospectus Supplement Summary
Risk Factors
The Trust
The Seller and Servicer
The Depositor
The Trustee and the Indenture Trustee
The Indenture and the Administration Agreement
Use of Proceeds
The Contracts
Loan Loss/Repossession Experience (Dollars in Thousands)
Yield and Prepayment Considerations
Weighted Average Lives of the Notes
Description of the Notes
Certain Information Regarding the Notes
Material Federal Income Tax Consequences
ERISA Considerations
Legal Proceedings
Underwriting
Ratings of the Notes
Legal Matters
Experts
Reports to Noteholders

ANNEX I

Global Clearance, Settlement and Tax Documentation Procedures
Glossary of Terms
Report of Independent Registered Public Accounting Firm
Harley-Davidson Motorcycle Trust [ ] Balance Sheet as of [ ]
Notes to the Balance Sheet
Table of Contents
Important Notice About Information Presented in this Prospectus and the Accompanying Prospectus Supplement
Prospectus Summary
Risk Factors
Harley-Davidson Motorcycles
Other Manufacturers
The Seller and Servicer
The Depositor
The Trusts
Use of Proceeds
The Trustee and the Indenture Trustee
Delinquencies, Repossessions and Net Losses
Weighted Average Lives of the Securities
Factors and Trading Information
Description of the Notes and Indenture
Information Regarding the Securities
Description of the Transfer and Servicing Agreements
Legal Aspects of the Contracts
Material Federal Income Tax Consequences
ERISA Considerations
Ratings of the Securities
Plan of Distribution
Legal Matters
Where You Can Find More Information
PART II Information Not Required In Prospectus

Item 14. Other Expenses of Issuance and Distribution

Item 15. Indemnification of Directors and Officers

Item 16. Exhibits

Item 17. Undertakings

Signatures
EXHIBIT INDEX
EX-4.1 2 a2158269zex-4_1.txt EXHIBIT 4.1 EXHIBIT 4.1 ================================================================================ TRUST AGREEMENT by and between HARLEY-DAVIDSON CUSTOMER FUNDING CORP., as Trust Depositor, and [_____], as Owner Trustee Dated as of [_____] ================================================================================ TABLE OF CONTENTS

ARTICLE SEVEN CONCERNING THE OWNER TRUSTEE........................................................................15 SECTION 7.01. ACCEPTANCE OF TRUSTS AND DUTIES...................................................................15 SECTION 7.02. FURNISHING OF DOCUMENTS...........................................................................16 SECTION 7.03. REPRESENTATIONS AND WARRANTIES....................................................................16 SECTION 7.04. RELIANCE; ADVICE OF COUNSEL.......................................................................16 SECTION 7.05. NOT ACTING IN INDIVIDUAL CAPACITY.................................................................17 SECTION 7.06. OWNER TRUSTEE NOT LIABLE FOR TRUST CERTIFICATE, NOTES OR CONTRACTS................................17 SECTION 7.07. OWNER TRUSTEE MAY OWN TRUST CERTIFICATE AND NOTES.................................................17 ARTICLE EIGHT COMPENSATION OF OWNER TRUSTEE.......................................................................18 SECTION 8.01. OWNER TRUSTEE'S FEES AND EXPENSES.................................................................18 SECTION 8.02. INDEMNIFICATION...................................................................................18 SECTION 8.03. PAYMENTS TO THE OWNER TRUSTEE.....................................................................18 ARTICLE NINE TERMINATION OF TRUST AGREEMENT......................................................................18 SECTION 9.01. TERMINATION OF TRUST AGREEMENT....................................................................18 ARTICLE TEN SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES..............................................19 SECTION 10.01. ELIGIBILITY REQUIREMENTS FOR OWNER TRUSTEE........................................................19 SECTION 10.02. RESIGNATION OR REMOVAL OF OWNER TRUSTEE...........................................................20 SECTION 10.03. SUCCESSOR OWNER TRUSTEE...........................................................................20 SECTION 10.04. MERGER OR CONSOLIDATION OF OWNER TRUSTEE..........................................................21 SECTION 10.05. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.....................................................21 ARTICLE ELEVEN MISCELLANEOUS.......................................................................................22 SECTION 11.01. SUPPLEMENTS AND AMENDMENTS........................................................................22 SECTION 11.02. NO LEGAL TITLE TO TRUST ESTATE IN OWNER...........................................................23 SECTION 11.03. LIMITATIONS ON RIGHTS OF OTHERS...................................................................23 SECTION 11.04. NOTICES...........................................................................................23 SECTION 11.05. SEVERABILITY OF PROVISIONS........................................................................23 SECTION 11.06. COUNTERPARTS......................................................................................23 SECTION 11.07. SUCCESSORS AND ASSIGNS............................................................................24 SECTION 11.08. COVENANTS OF THE TRUST DEPOSITOR..................................................................24 SECTION 11.09. NO PETITION.......................................................................................24 SECTION 11.10. NO RECOURSE.......................................................................................24 SECTION 11.11. HEADINGS..........................................................................................24 SECTION 11.12. GOVERNING LAW.....................................................................................24 SECTION 11.13. TRUST CERTIFICATE TRANSFER RESTRICTIONS...........................................................25 SECTION 11.14. TRUST DEPOSITOR PAYMENT OBLIGATION................................................................25 [SIGNATURE PAGE FOLLOWS]..........................................................................25

EXHIBITS Exhibit A - Form of Certificate of Trust................................................................................A-1 Exhibit B - Form of Trust Certificate...................................................................................B-1

- ii - TRUST AGREEMENT dated as of [_____], between HARLEY-DAVIDSON CUSTOMER FUNDING CORP., a Nevada corporation, as Trust Depositor (the "TRUST DEPOSITOR"), and [_____], a [_____], as owner trustee (the "OWNER TRUSTEE"). WHEREAS, in connection herewith, the Trust Depositor is willing to assume certain obligations pursuant hereto; and WHEREAS, in connection herewith, the Trust Depositor is willing to purchase the Trust Certificate (as defined herein) to be issued pursuant to this Agreement and to assume certain obligations pursuant hereto; NOW, THEREFORE, the parties hereto hereby agree as follows: ARTICLE ONE DEFINITIONS SECTION 1.01. CAPITALIZED TERMS. Except as otherwise provided in this Agreement, whenever used in this Agreement the following words and phrases, unless the context otherwise requires, shall have the following meanings: "ADMINISTRATION AGREEMENT" means the Administration Agreement, dated as of [_____], among the Trust, the Trust Depositor, the Indenture Trustee and Harley-Davidson Credit, as administrator. "AGREEMENT" means this Trust Agreement, as the same may be amended and supplemented from time to time. "BENEFIT PLAN" means (i) an employee benefit plan (as such term is defined in Section 3(3) of ERISA) that is subject to the provisions of Title I of ERISA, (ii) a plan described in Section 4975(e)(1) of the Code or (iii) any entity whose underlying assets include plan assets by reason of a plan's investment in the entity. "CERTIFICATE OF TRUST" means the Certificate of Trust filed for the Trust pursuant to Section 3810(a) of the Statutory Trust Statute, substantially in the form of EXHIBIT A hereto. "CERTIFICATE REGISTER" and "CERTIFICATE REGISTRAR" mean the register maintained and the registrar (or any successor thereto) appointed pursuant to Section 3.04. "CERTIFICATEHOLDER" or "HOLDER" means with respect to a Trust Certificate the Person in whose name the Trust Certificate is registered in the Certificate Register. "CLEARING AGENCY" means an organization registered as a "Clearing Agency" pursuant to Section 17A of the Exchange Act. - 1 - "CLOSING DATE" shall have the meaning assigned to such term in the Sale and Servicing Agreement. "CODE" means the Internal Revenue Code of 1986, as amended. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. "EXPENSES" shall have the meaning assigned to such term in Section 8.02. "HARLEY-DAVIDSON CREDIT" means Harley-Davidson Credit Corp., a Nevada corporation. "INDEMNIFIED PARTIES" shall have the meaning assigned to such term in Section 8.02. "INDENTURE" means the Indenture dated as of [_____] between the Trust and [_____]. "NOTE DEPOSITORY AGREEMENT" means the Agreement dated as of the Closing Date among the Trust, the Indenture Trustee, the Administrator and DTC, as the Clearing Agency, relating to the Notes, as the same may be amended and supplemented from time to time. "NOTES" means the Class A-1 Notes, the Class A-2 Notes and the Class B Notes, in each case issued pursuant to the Indenture. "OWNER" means the Holder of the Trust Certificate. "OWNER TRUSTEE" means [_____], a [_____], not in its individual capacity but solely as owner trustee under this Agreement, and any successor Owner Trustee hereunder. "OWNER TRUSTEE CORPORATE TRUST OFFICE" means the office of the Owner Trustee at which its corporate trust business shall be administered, which initially shall be [_____] Attn: [_____], or such other office at such other address as the Owner Trustee may designate from time to time by notice to the Certificateholder, the Servicer, the Indenture Trustee, the Trust Depositor and Harley-Davidson Credit. "PAYING AGENT" means any paying agent or co-paying agent appointed pursuant to Section 3.10. "PERSON" means any individual, corporation, estate, partnership, joint venture, association, joint stock company, trust (including any beneficiary thereof) unincorporated organization or government or any agency or political subdivision thereof. "RECORD DATE" means, with respect to any Distribution Date, the last Business Day of the preceding calendar month. "SALE AND SERVICING AGREEMENT" means the Sale and Servicing Agreement, dated as of [_____], among the Trust, as Issuer, the Trust Depositor, Harley-Davidson Credit, as servicer, and [_____], as Indenture Trustee, as the same may be amended or supplemented from time to time. - 2 - "SECRETARY OF STATE" means the Secretary of State of the State of Delaware. "STATUTORY TRUST STATUTE" means Chapter 38 of Title 12 of the Delaware Code, 12 DEL. CODE Section 3801 ET SEQ., as the same may be amended from time to time. "TAX MATTERS PARTNER" shall have the meaning provided in Section 5.04(b) hereof. "TREASURY REGULATIONS" means regulations, including proposed or temporary regulations, promulgated under the Code. References herein to specific provisions of proposed or temporary regulations shall include analogous provisions of final Treasury Regulations or other successor Treasury Regulations. "TRUST" means the trust established by this Agreement. "TRUST CERTIFICATE" means the trust certificate evidencing the beneficial equity interest of the Owner, substantially in the form of EXHIBIT B hereto. "TRUST DEPOSITOR" means Harley-Davidson Customer Funding Corp. in its capacity as Trust Depositor hereunder, and its successors. "TRUST ESTATE" means all right, title and interest of the Trust in and to the property and rights assigned to the Trust pursuant to Article Two of the Sale and Servicing Agreement, all funds on deposit from time to time in the Trust Accounts and all other property of the Trust from time to time, including any rights of the Owner Trustee and the Trust pursuant to the Sale and Servicing Agreement and the Administration Agreement. "UNDERWRITERS" shall have the meaning set forth in the Sale and Servicing Agreement. SECTION 1.02. OTHER DEFINITIONAL PROVISIONS. Capitalized terms used that are not otherwise defined herein shall have the meanings ascribed thereto in the Sale and Servicing Agreement or, if not defined therein, in the Indenture. SECTION 1.03. USAGE OF TERMS. With respect to all terms in this Agreement, the singular includes the plural and the plural the singular; words importing any gender include the other genders; references to "WRITING" include printing, typing, lithography and other means of reproducing words in a visible form; references to agreements and other contractual instruments include all amendments, modifications and supplements thereto or any changes therein entered into in accordance with their respective terms and not prohibited by this Agreement; references to Persons include their permitted successors and assigns; and the term "INCLUDING" means "INCLUDING WITHOUT LIMITATION". SECTION 1.04. SECTION REFERENCES. All section references, unless otherwise indicated, shall be to Sections in this Agreement. SECTION 1.05. ACCOUNTING TERMS. All accounting terms used but not specifically defined herein shall be construed in accordance with generally accepted accounting principles in the United States. - 3 - ARTICLE TWO ORGANIZATION SECTION 2.01. NAME. The Trust created hereby shall be known as "HARLEY-DAVIDSON MOTORCYCLE TRUST [_____]", in which name the Owner Trustee may conduct the activities of the Trust, make and execute contracts and other instruments on behalf of the Trust and sue and be sued. SECTION 2.02. OFFICE. The office of the Trust shall be in care of the Owner Trustee at the Owner Trustee Corporate Trust Office or at such other address in Delaware as the Owner Trustee may designate by written notice to the Owner and the Trust Depositor. SECTION 2.03. PURPOSES AND POWERS. (a) The sole purpose of the Trust is to manage the Trust Estate and collect and disburse the periodic income therefrom for the use and benefit of the Owner, and in furtherance of such purpose to engage in the following ministerial activities: (i) to issue the Notes pursuant to the Indenture and the Trust Certificate pursuant to this Agreement and to sell the Notes; (ii) with the proceeds of the sale of the Notes, to purchase the Contracts, to fund the Pre-Funding Account and to pay the organizational, start-up and transactional expenses of the Trust and to pay the balance to the Trust Depositor pursuant to the Sale and Servicing Agreement; (iii) to assign, grant, transfer, pledge, mortgage and convey the Trust Estate pursuant to the Indenture and to hold, manage and distribute to the Owner pursuant to the Sale and Servicing Agreement any portion of the Trust Estate released from the Lien of, and remitted to the Trust pursuant to, the Indenture; (iv) to enter into and perform its obligations under the Transaction Documents to which it is to be a party; (v) to engage in those activities, including entering into agreements, that are necessary, suitable or convenient to accomplish the foregoing or are incidental thereto or connected therewith; and (vi) subject to compliance with the Transaction Documents, to engage in such other activities as may be required in connection with conservation of the Trust Estate and the making of distributions to the Owner and the Noteholders. The Trust shall not engage in any activities other than in connection with the foregoing. Nothing contained herein shall be deemed to authorize the Owner Trustee to engage in any business operations or any activities other than those set forth in the introductory sentence of this Section. Specifically, the Owner Trustee shall have no authority to engage in any business operations, or acquire any assets other than those specifically included in the Trust Estate under Section 1.01, or otherwise vary the assets held - 4 - by the Trust. Similarly, the Owner Trustee shall have no discretionary duties other than performing those ministerial acts set forth above necessary to accomplish the purpose of this Trust as set forth in the introductory sentence of this Section. SECTION 2.04. APPOINTMENT OF OWNER TRUSTEE. The Trust Depositor hereby appoints the Owner Trustee as trustee of the Trust effective as of the date hereof, to have all the rights, powers and duties set forth herein, and the Owner Trustee hereby accepts such appointment. SECTION 2.05. INITIAL CAPITAL CONTRIBUTION OF OWNER TRUST ESTATE. The Trust Depositor hereby sells, assigns, transfers, conveys and sets over to the Owner Trustee, as of the date hereof, the sum of $1,000. The Owner Trustee hereby acknowledges receipt in trust from the Trust Depositor, as of the date hereof, of the foregoing contribution, which shall constitute the initial Trust Estate. The Trust Depositor shall pay organizational expenses of the Trust as they may arise or shall, upon the request of the Owner Trustee, promptly reimburse the Owner Trustee for any such expenses paid by the Owner Trustee. SECTION 2.06. DECLARATION OF TRUST. The Owner Trustee hereby declares that it will hold the Trust Estate in trust upon and subject to the conditions set forth herein for the sole purpose of conserving the Trust Estate and collecting and disbursing the periodic income therefrom for the use and benefit of the Owner, subject to the obligations of the Trust under the Transaction Documents. It is the intention of the parties hereto that the Trust constitute a statutory trust under the Statutory Trust Statute and that this Agreement constitute the governing instrument of such statutory trust. Effective as of the date hereof, the Owner Trustee shall have all rights, powers and duties set forth herein and in the Statutory Trust Statute for the sole purpose and to the extent necessary to accomplish the purpose of this Trust as set forth in the introductory sentence of Section 2.03. SECTION 2.07. LIABILITY OF TRUST DEPOSITOR. (a) All liabilities of the Trust, to the extent not paid by a third party, are and shall be obligations of the Trust and when due and payable shall be satisfied out of the Trust Estate. (b) Except as provided in the Statutory Trust Statute, the Certificateholder shall not be personally liable for any liability of the Trust. SECTION 2.08. TITLE TO TRUST PROPERTY. Legal title to the Trust Estate shall be vested at all times in the Trust as a separate legal entity except where applicable law in any jurisdiction requires title to any part of the Trust Estate to be vested in an Owner Trustee or Owner Trustees, in which case title shall be deemed to be vested in the Owner Trustee, a co-trustee and/or a separate trustee, as the case may be. SECTION 2.09. SITUS OF TRUST. The Trust will be located and administered in the State of Delaware. All bank accounts maintained by the Owner Trustee on behalf of the Trust shall be located in the State of Illinois or the State of Delaware. The Trust shall not have any employees in any state other than Delaware; PROVIDED, HOWEVER, that nothing herein shall restrict or prohibit the Owner Trustee from having employees within or without the State of Delaware. Payments will be received by the Trust only in Delaware and payments will be made by the Trust only from Delaware. The only office of the Trust will be at the Owner Trustee Corporate Trust Office. SECTION 2.10. REPRESENTATIONS AND WARRANTIES OF THE TRUST DEPOSITOR. - 5 - The Trust Depositor hereby represents and warrants to the Owner Trustee that: (i) The Trust Depositor is duly organized and validly existing as a corporation organized and existing and in good standing under the laws of the State of Nevada, with power and authority to own its properties and to conduct its business and had at all relevant times, and has, power, authority and legal right to acquire and own the Contracts. (ii) The Trust Depositor is duly qualified to do business as a foreign corporation in good standing and has obtained all necessary licenses and approvals in all jurisdictions in which the ownership or lease of property or the conduct of its business requires such qualifications. (iii) The Trust Depositor has the power and authority to execute and deliver this Agreement and to carry out its terms; the Trust Depositor has full power and authority to sell and assign the property to be sold and assigned to and deposited with the Owner Trustee on behalf of the Trust as part of the Trust Estate and has duly authorized such sale and assignment and deposit with the Owner Trustee on behalf of the Trust by all necessary corporate action; and the execution, delivery and performance of this Agreement have been duly authorized by the Trust Depositor by all necessary corporate action. (iv) The consummation of the transactions contemplated by this Agreement and the fulfillment of the terms hereof do not conflict with, result in any breach of any of the terms and provisions of, nor constitute (with or without notice or lapse of time) a default under, the articles of incorporation or bylaws of the Trust Depositor, or any indenture, agreement or other instrument to which the Trust Depositor is a party or by which it is bound; nor result in the creation or imposition of any Lien upon any of the properties of the Trust Depositor pursuant to the terms of any such indenture, agreement or other instrument (other than pursuant to the Transaction Documents); nor violate any law or any order, rule or regulation applicable to the Trust Depositor of any court or of any federal or state regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Trust Depositor or its properties. (v) There are no proceedings or investigations pending, or to the Trust Depositor's best knowledge threatened, before any court, regulatory body, administrative agency or other governmental instrumentality having jurisdiction over the Trust Depositor or its properties: (A) asserting the invalidity of this Agreement, any of the other Transaction Documents or the Trust Certificate, (B) seeking to prevent the issuance of the Trust Certificate or the consummation of any of the transactions contemplated by this Agreement or any of the other Transaction Documents, (C) seeking any determination or ruling that might materially and adversely affect the performance by the Trust Depositor of its obligations under, or the validity or enforceability of, this Agreement, any of the other Transaction Documents or the Trust Certificate or (D) involving the Trust Depositor and which might adversely affect the federal income tax or other federal, state or local tax attributes of the Trust Certificate. SECTION 2.11. FEDERAL INCOME TAX TREATMENT. It is the intention of the Trust Depositor that the Trust be disregarded as a separate entity pursuant to Treasury Regulations Section 301.7701-3(b)(1)(ii) as in effect for periods after January 1, 1997. The - 6 - Trust Certificate constitutes the sole equity interest in the Trust and must at all times be held by either the Trust Depositor or its transferee as sole owner. The Trust Depositor agrees not to take any action inconsistent with such intended federal income tax treatment. Because for federal income tax purposes the Trust will be disregarded as a separate entity, Trust items of income, gain, loss and deduction for any month as determined for federal income tax purposes shall be allocated entirely to the Trust Depositor (or subsequent purchaser of the Trust Certificate) as the sole Certificateholder. ARTICLE THREE TRUST CERTIFICATE AND TRANSFER OF INTERESTS SECTION 3.01. INITIAL OWNERSHIP. (a) Upon the formation of the Trust by the contribution by the Trust Depositor pursuant to Section 2.05 and until the issuance of the Trust Certificate, the Trust Depositor shall be the sole beneficiary of the Trust. The Trust Certificate must at all times be held by either the Trust Depositor or its transferee as sole owner. (b) No transfer of the Trust Certificate shall be made unless such transfer is made in a transaction which does not require registration or qualification under the Securities Act of 1933 or qualification under any state securities or "Blue Sky" laws. Neither the Owner Trustee nor the Certificate Registrar shall effect the registration of any transfer of the Trust Certificate unless, (i) prior to such transfer the Owner Trustee shall have received a Tax Opinion, and (ii) following such transfer, there would be no more than one holder of the Trust Certificate and the holder of the Trust Certificate would not be a Foreign Person, a partnership, Subchapter S corporation or grantor trust. - 7 - SECTION 3.02. THE TRUST CERTIFICATE. The Trust Certificate shall be substantially in the form of EXHIBIT B hereto. The Trust Certificate shall be executed by the Owner Trustee on behalf of the Trust by manual or facsimile signature of an authorized officer of the Owner Trustee and shall be deemed to have been validly issued when so executed. The Trust Certificate bearing the manual or facsimile signature of individuals who were, at the time when such signatures were affixed, authorized to sign on behalf of the Owner Trustee shall be a valid and binding obligation of the Trust, notwithstanding that such individuals or any of them have ceased to be so authorized prior to the authentication and delivery of such Trust Certificate or did not hold such offices at the date of such Trust Certificate. The Trust Certificate shall be dated the date of its authentication. SECTION 3.03. AUTHENTICATION AND DELIVERY OF TRUST CERTIFICATE. The Owner Trustee shall cause to be authenticated and delivered upon the order of the Trust Depositor, in exchange for the Contracts and the other Trust Assets, simultaneously with the sale, assignment and transfer to the Trust of the Contracts and other Trust Assets, and the constructive delivery to the Owner Trustee of the Contract Files and the other Trust Assets, a Trust Certificate duly authenticated by the Owner Trustee, evidencing the entire ownership of the Trust, and Notes issued by the Owner Trustee and authenticated by the Indenture Trustee in aggregate principal amount of, in the case of (i) Class A-1 Notes, $[_________], (ii) Class A-2 Notes, $[_________] and (iii) Class B Notes, $[_________], or be valid for any purpose, unless there appears on such Trust Certificate a certificate of authentication substantially in the form set forth in the form of Trust Certificate attached hereto as EXHIBIT B, executed by the Owner Trustee or its authenticating agent, by manual signature, and such certificate upon any Trust Certificate shall be conclusive evidence, and the only evidence, that such Trust Certificate has been duly authenticated and delivered hereunder. Upon issuance, authorization and delivery pursuant to the terms hereof, the Trust Certificate will be entitled to the benefits of this Agreement. SECTION 3.04. REGISTRATION OF TRANSFER AND EXCHANGE OF TRUST CERTIFICATE. (a) The Certificate Registrar shall keep or cause to be kept, a Certificate Register, subject to such reasonable regulations as it may prescribe. The Certificate Register shall provide for the registration of the Trust Certificate and transfers and exchanges of the Trust Certificate as provided herein. The Owner Trustee is hereby initially appointed Certificate Registrar for the purpose of registering the Trust Certificate and transfers and exchanges of the Trust Certificate as herein provided. In the event that, subsequent to the Closing Date, the Owner Trustee notifies the Servicer that it is unable to act as Certificate Registrar, the Servicer shall appoint another bank or trust company, having an office or agency located in the City of Chicago, Illinois, agreeing to act in accordance with the provisions of this Agreement applicable to it, and otherwise acceptable to the Owner Trustee, to act as successor Certificate Registrar hereunder. (b) Upon surrender for registration of transfer of the Trust Certificate at the Owner Trustee Corporate Trust Office, the Owner Trustee shall execute, authenticate and deliver (or shall cause its authenticating agent to authenticate and deliver), in the name of the designated transferee, the new Trust Certificate having the same aggregate principal amount. (c) Every Trust Certificate presented or surrendered for registration of transfer shall be accompanied by a written instrument of transfer in form satisfactory to the Owner Trustee and the Certificate Registrar duly executed by the Holder thereof or his attorney duly authorized in writing. - 8 - (d) No service charge shall be made for any registration of transfer or exchange of the Trust Certificate, but the Owner Trustee may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer of the Trust Certificate. (e) All Trust Certificates surrendered for registration of transfer shall be canceled and subsequently destroyed by the Owner Trustee. SECTION 3.05. MUTILATED, DESTROYED, LOST OR STOLEN TRUST CERTIFICATE. If (i) any mutilated Trust Certificate is surrendered to the Certificate Registrar, or the Certificate Registrar receives evidence to its satisfaction of the destruction, loss or theft of any Trust Certificate, and (ii) there is delivered to the Certificate Registrar and the Owner Trustee such security or indemnity as may be required by them to save each of them harmless, then, in the absence of notice that such Trust Certificate has been acquired by a bona fide purchaser, the Owner Trustee on behalf of the Trust shall execute and the Owner Trustee or its authenticating agent shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Trust Certificate, a new Trust Certificate of like tenor and fractional undivided interest. In connection with the issuance of any new Trust Certificate under this Section, the Owner Trustee may require the payment by the Holder of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto. Any duplicate Trust Certificate issued pursuant to this Section shall constitute complete and indefeasible evidence of ownership in the Trust, as if originally issued, whether or not the lost, stolen or destroyed Trust Certificate shall be found at any time. SECTION 3.06. PERSON DEEMED OWNER. Prior to due presentation of a Trust Certificate for registration of transfer, the Owner Trustee, the Certificate Registrar and any of their respective agents may treat the Person in whose name any Trust Certificate is registered as the owner of such Trust Certificate for the purpose of receiving distributions pursuant to Section 5.01 and for all other purposes whatsoever, and none of the Owner Trustee, the Certificate Registrar, any Paying Agent or any of their respective agents shall be affected by any notice of the contrary. SECTION 3.07. ACCESS TO LIST OF CERTIFICATEHOLDER'S NAME AND ADDRESS. The Owner Trustee shall furnish or cause to be furnished to the Servicer and the Trust Depositor, within 15 days after receipt by the Certificate Registrar of a written request therefor from the Servicer or the Trust Depositor, the name and address of the Certificateholder as of the most recent Record Date in such form as the Servicer or the Trust Depositor may reasonably require. The Certificateholder, by receiving and holding the Trust Certificate, agrees with the Servicer, the Trust Depositor and the Owner Trustee that none of the Servicer, the Trust Depositor or the Owner Trustee shall be held accountable by reason of the disclosure of any such information as to the name and address of the Certificateholder hereunder, regardless of the source from which such information was derived. SECTION 3.08. MAINTENANCE OF OFFICE OR AGENCY. The Owner Trustee shall maintain in Wilmington, Delaware, an office or offices or agency or agencies where the Trust Certificate may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Owner Trustee in respect of the Trust Certificate and this Agreement may be served. The Owner Trustee hereby designates the Owner Trustee Corporate Trust Office as its office for such purposes. The Owner Trustee shall give prompt written notice to the Trust Depositor, the Servicer and to the Certificateholder of any change in the location of the Certificate Register or any such office or agency. - 9 - SECTION 3.09. TRUST CERTIFICATE. The Owner Trustee, on behalf of the Trust, shall execute, authenticate and deliver, a Trust Certificate. SECTION 3.10. APPOINTMENT OF PAYING AGENT. The Paying Agent shall make distributions to the Certificateholder pursuant to Section 5.01(a) and shall report the amounts of such distributions to the Owner Trustee. The Paying Agent initially shall be [_________], and any co-paying agent chosen by the Paying Agent that is acceptable to the Owner Trustee. Each Paying Agent shall be permitted to resign as Paying Agent upon 30 days' written notice to the Owner Trustee. In the event that [_________] shall no longer be the Paying Agent, the Owner Trustee shall appoint a successor to act as Paying Agent (which shall be a bank or trust company). The Owner Trustee shall cause such successor Paying Agent or any additional Paying Agent appointed by the Owner Trustee to execute and deliver to the Owner Trustee an instrument in which such successor Paying Agent or additional Paying Agent shall agree with the Owner Trustee that, as Paying Agent, such successor Paying Agent or additional Paying Agent will hold all sums, if any, held by it for payment to the Certificateholder in trust for the benefit of the Certificateholder entitled thereto until such sums shall be paid to such Certificateholder. The Paying Agent shall return all unclaimed funds to the Owner Trustee and upon removal of a Paying Agent such Paying Agent shall also return all funds in its possession to the Owner Trustee. The provisions of Sections 7.01, 7.03, 7.04 and 8.01 shall apply to the Owner Trustee also in its role as Paying Agent, for so long as the Owner Trustee shall act as Paying Agent and, to the extent applicable, to any other paying agent appointed hereunder. Any reference in this Agreement to the Paying Agent shall include any co-paying agent unless the context requires otherwise. SECTION 3.11. OWNERSHIP BY TRUST DEPOSITOR OF TRUST CERTIFICATE. The Trust Depositor shall on the Closing Date hold the Trust Certificate. ARTICLE FOUR ACTIONS BY OWNER TRUSTEE SECTION 4.01. PRIOR NOTICE TO OWNER WITH RESPECT TO CERTAIN MATTERS. Subject to the provisions and limitation of Section 4.04, with respect to the following matters, the Owner Trustee shall not take action unless at least 30 days before the taking of such action, the Owner Trustee shall have notified the Certificateholder in writing of the proposed action, the Indenture Trustee shall have consented to such action in the event any Notes are outstanding and the Owner shall not have notified the Owner Trustee in writing prior to the 30th day after such notice is given that the Owner has withheld consent or provided alternative direction: (a) the initiation of any claim or lawsuit by the Trust (except claims or lawsuits brought in connection with the collection of the Contracts) and the compromise of any action, claim or lawsuit brought by or against the Trust (except with respect to the aforementioned claims or lawsuits for collection of the Contracts); (b) the election by the Trust to file an amendment to the Certificate of Trust (unless such amendment is required to be filed under the Statutory Trust Statute); - 10 - (c) the amendment of the Indenture by a supplemental indenture in circumstances where the consent of any Noteholder is required; (d) the amendment of the Indenture by a supplemental indenture in circumstances where the consent of any Noteholder is not required and such amendment materially and adversely affects the interest of the Owner; (e) the amendment, change or modification of the Administration Agreement, except to cure any ambiguity or to amend or supplement any provision in a manner or add any provision that would not materially and adversely affect the interests of the Owner; or (f) the appointment pursuant to the Indenture of a successor Note Registrar or Indenture Trustee or pursuant to this Agreement of a successor Certificate Registrar, or the consent to the assignment by the Note Registrar, Indenture Trustee or Certificate Registrar of its obligations under the Indenture or the Agreement, as applicable. SECTION 4.02. ACTION BY OWNER WITH RESPECT TO CERTAIN MATTERS. Subject to the provisions and limitations of Section 4.04, the Owner Trustee shall not have the power, except upon the direction of the Owner, to (a) remove the Administrator pursuant to Section 8 of the Administration Agreement, (b) appoint a successor Administrator pursuant to Section 8 of the Administration Agreement, (c) except as expressly provided in the Transaction Documents, sell the Contracts or other Trust Assets after the termination of the Indenture, (d) initiate any claim, suit or proceeding by the Trust or compromise any claim, suit or proceeding brought by or against the Trust, (e) authorize the merger or consolidation of the Trust with or into any other statutory trust or entity (other than in accordance with Section 3.10 of the Indenture) or (f) amend the Certificate of Trust. The Owner Trustee shall take the actions referred to in the preceding sentence only upon written instructions assigned by the Owner. SECTION 4.03. ACTION BY OWNER WITH RESPECT TO BANKRUPTCY. The Owner Trustee shall not have the power to commence a voluntary proceeding in a bankruptcy relating to the Trust without the prior approval of Owner and the delivery to the Owner Trustee by such Owner of a certificate certifying that such Owner reasonably believes that the Trust is insolvent. SECTION 4.04. RESTRICTIONS ON OWNER'S POWER. The Owner shall not direct the Owner Trustee to take or to refrain from taking any action if such action or inaction would be contrary to any obligation of the Trust or the Owner Trustee under this Agreement or any of the Transaction Documents or would be contrary to the purpose of this Trust as set forth in Section 2.03, nor shall the Owner Trustee be obligated to follow any such direction, if given. ARTICLE FIVE APPLICATION OF TRUST FUNDS; CERTAIN DUTIES SECTION 5.01. APPLICATION OF TRUST FUNDS. - 11 - (a) On each Distribution Date, the Paying Agent will distribute to the Certificateholder amounts received pursuant to Section 7.05 of the Sale and Servicing Agreement with respect to such Distribution Date. (b) On each Distribution Date, the Paying Agent shall send to the Certificateholder the statement or statements provided to the Owner Trustee by the Servicer pursuant to Section 9.01 of the Sale and Servicing Agreement with respect to such Distribution Date. (c) In the event that any withholding tax is imposed on the Trust's payment (or allocation of income) to the Certificateholder, such tax shall reduce the amount otherwise distributable to the Certificateholder in accordance with this Section. The Paying Agent is hereby authorized and directed to retain from amounts otherwise distributable to the Owner sufficient funds for the payment of any tax that is legally owed by the Trust (but such authorization shall not prevent the Owner Trustee from contesting any such tax in appropriate proceedings, and withholding payment of such tax, if permitted by law, pending the outcome of such proceedings). The amount of any withholding tax imposed with respect to the Certificateholder shall be treated as cash distributed to such Certificateholder at the time it is withheld by the Trust and remitted to the appropriate taxing authority. If there is a possibility that withholding tax is payable with respect to a distribution, the Paying Agent may in its sole discretion withhold such amounts in accordance with the paragraph (c). SECTION 5.02. METHOD OF PAYMENT. Subject to Section 9.01(c) respecting the final payment upon retirement of the Trust Certificate, distributions required to be made to the Certificateholder of record on the related Record Date shall be made by check mailed to such Certificateholder at the address of such Holder appearing in the Certificate Register. SECTION 5.03. ACCOUNTING AND REPORTS TO THE CERTIFICATEHOLDER, OWNER, THE INTERNAL REVENUE SERVICE AND OTHERS. The Administrator shall (a) maintain (or cause to be maintained) the books of the Trust on a calendar year basis and the accrual method of accounting, (b) deliver to the Owner, as may be required by the Code and applicable Treasury Regulations, such information as may be required to enable the Owner to prepare its federal and state income tax returns, (c) file such tax returns relating to the Trust and make such elections as from time to time may be required or appropriate under any applicable state or federal statute or any rule or regulation thereunder so as to maintain the federal income tax treatment for the Trust as set forth in Section 2.11, (d) cause such tax returns to be signed in the manner required by law and (e) collect or cause to be collected any withholding tax as described in and in accordance with Section 5.01(c) with respect to income or distributions to Owner. The Owner Trustee shall elect under Section 1278 of the Code to include in income currently any market discount that accrues with respect to the Contracts. If applicable, the Owner Trustee shall not make the election provided under Section 754 or Section 761 of the Code. SECTION 5.04. SIGNATURE ON RETURNS; TAX MATTERS PARTNER. (a) The Trust Depositor shall sign on behalf of the Trust the tax returns of the Trust. (b) If subchapter K of the Code should be applicable to the Trust, the Certificateholder shall be designated the "TAX MATTERS PARTNER" of the Trust pursuant to Section 6231(a)(7)(A) of the Code and applicable Treasury Regulations. - 12 - ARTICLE SIX AUTHORITY AND DUTIES OF OWNER TRUSTEE SECTION 6.01. GENERAL AUTHORITY. Subject to the provisions and limitations of Sections 2.03 and 2.06, the Owner Trustee is authorized and directed to execute and deliver the Transaction Documents to which the Trust is to be a party and each certificate or other document attached as an exhibit to or contemplated by the Transaction Documents to which the Trust is to be a party and any amendment or other agreement, as evidenced conclusively by the Owner Trustee's execution thereof. In addition to the foregoing, the Owner Trustee is authorized, but shall not be obligated, to take all actions required of the Trust pursuant to the Transaction Documents. The Owner Trustee is further authorized from time to time to take such action as the Administrator recommends with respect to the Transaction Documents. SECTION 6.02. GENERAL DUTIES. Subject to the provisions and limitations of Sections 2.03 and 2.06, it shall be the duty of the Owner Trustee to discharge (or cause to be discharged through the Administrator) all of its responsibilities pursuant to the terms of this Agreement and the Transaction Documents to which the Trust is a party and to administer the Trust in the interest of the Owner, subject to the Transaction Documents and in accordance with the provisions of this Agreement. Without limiting the foregoing, the Owner Trustee shall on behalf of the Trust file and prove any claim or claims that may exist against Harley-Davidson Credit in connection with any claims paying procedure as part of an insolvency or receivership proceeding involving Harley-Davidson Credit. Notwithstanding the foregoing, the Owner Trustee shall be deemed to have discharged its duties and responsibilities hereunder and under the Transaction Documents to the extent the Administrator has agreed in the Administration Agreement to perform any act or to discharge any duty of the Owner Trustee hereunder or under any Transaction Document, and the Owner Trustee shall not be held liable for the default or failure of the Administrator to carry out its obligations under the Administration Agreement. SECTION 6.03. ACTION UPON INSTRUCTION. (a) Subject to Article Four, in accordance with the terms of the Transaction Documents the Owner may by written instruction direct the Owner Trustee in the management of the Trust. (b) The Owner Trustee shall not be required to take any action hereunder or under any other Transaction Document if the Owner Trustee shall have reasonably determined, or shall have been advised by counsel, that such action is likely to result in liability on the part of the Owner Trustee or is contrary to the terms hereof or of any other Transaction Document or is otherwise contrary to law. (c) Whenever the Owner Trustee is unable to decide between alternative courses of action permitted or required by the terms of this Agreement or under any other Transaction Document, the Owner Trustee shall promptly give notice (in such form as shall be appropriate under the circumstances) to the Owner requesting instruction as to the course of action to be adopted, and to the extent the Owner Trustee acts in good faith in accordance with any written instruction of the Owner received, the Owner Trustee shall not be liable on account of such action to any Person. If the Owner Trustee shall not have received appropriate instruction within ten days of such notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the - 13 - circumstances) it may, but shall be under no duty to, take or refrain from taking such action not inconsistent with this Agreement and the other Transaction Documents, as it shall deem to be in the best interests of the Owner, and shall have no liability to any Person for such action or inaction. (d) In the event that the Owner Trustee is unsure as to the applicability of any provision of this Agreement or any other Transaction Document or any such provision is ambiguous as to its application, or is, or appears to be, in conflict with any other applicable provision, or in the event that this Agreement permits any determination by the Owner Trustee or is silent or is incomplete as to the course of action that the Owner Trustee is required to take with respect to a particular set of facts, the Owner Trustee may give notice (in such form as shall be appropriate under the circumstances) to the Owner requesting instruction and, to the extent that the Owner Trustee acts or refrains from acting in good faith in accordance with any such instruction received, the Owner Trustee shall not be liable, on account of such action or inaction, to any Person. If the Owner Trustee shall not have received appropriate instruction within ten days of such notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the circumstances) it may, but shall be under no duty to, take or refrain from taking such action not inconsistent with this Agreement or the other Transaction Documents, as it shall deem to be in the best interests of the Owner, and shall have no liability to any Person for such action or inaction. SECTION 6.04. NO DUTIES EXCEPT AS SPECIFIED IN THIS AGREEMENT OR IN INSTRUCTIONS. The Owner Trustee shall not have any duty or obligation to manage, make any payment with respect to, register, record, sell, dispose of or otherwise deal with the Trust Estate, or to otherwise take or refrain from taking any action under, or in connection with, any document contemplated hereby to which the Owner Trustee is a party, except as expressly provided by the terms of this Agreement or any document or written instruction received by the Owner Trustee pursuant to Section 6.03; and no implied duties or obligations shall be read into this Agreement or any other Transaction Document against the Owner Trustee. The Owner Trustee shall have no responsibility for filing any financing or continuation statement in any public office at any time or to otherwise perfect or maintain the perfection of any security interest or lien granted to it hereunder or to prepare or file any Commission filing for the Trust or to record this Agreement or any other Transaction Document. The Owner Trustee nevertheless agrees that it will, at its own cost and expense, promptly take all action as may be necessary to discharge any liens on any part of the Trust Estate that result from actions by, or claims against, the Owner Trustee that are not related to the ownership or the administration of the Trust Estate. SECTION 6.05. NO ACTION EXCEPT UNDER SPECIFIED DOCUMENTS OR INSTRUCTIONS. The Owner Trustee shall not manage, control, use, sell, dispose of or otherwise deal with any part of the Trust Estate except (i) in accordance with the powers granted to and the authority conferred upon the Owner Trustee pursuant to this Agreement, (ii) in accordance with the other Transaction Documents and (iii) in accordance with any document or instruction delivered to the Owner Trustee pursuant to Section 6.03. SECTION 6.06. RESTRICTIONS. The Owner Trustee shall not take any action (i) that is inconsistent with the purposes of the Trust set forth in Section 2.03 or (ii) that, to the actual knowledge of the Owner Trustee, would result in the Trust's becoming taxable as a corporation for federal or state income tax purposes. The Owner shall not direct the Owner Trustee to take actions that would violate the provisions of this Section. - 14 - SECTION 6.07. PENNSYLVANIA MOTOR VEHICLE SALES FINANCE ACT LICENSES. The Owner Trustee shall use its best efforts to maintain the effectiveness of all licenses required under the Pennsylvania Motor Vehicle Sales Finance Act in connection with the transactions contemplated by the Transaction Documents until the lien and security interest of the Indenture shall no longer be in effect in accordance with its terms. ARTICLE SEVEN CONCERNING THE OWNER TRUSTEE SECTION 7.01. ACCEPTANCE OF TRUSTS AND DUTIES. The Owner Trustee accepts the trusts hereby created and agrees to perform its duties hereunder with respect to such trusts but only upon the terms of this Agreement. The Owner Trustee also agrees to disburse all moneys actually received by it constituting part of the Trust Estate upon the terms of the Transaction Documents and this Agreement. The Owner Trustee shall not be answerable or accountable hereunder or under any other Transaction Document under any circumstances, except (i) for its own willful misconduct or negligence or (ii) in the case of the inaccuracy of any representation or warranty contained in Section 7.03 expressly made by the Owner Trustee. In particular, but not by way of limitation (and subject to the exceptions set forth in the preceding sentence): (a) the Owner Trustee shall not be liable for any error of judgment made by a responsible officer of the Owner Trustee; (b) the Owner Trustee shall not be liable with respect to any action taken or omitted to be taken by it in accordance with the instructions of the Administrator or any Owner; (c) no provision of this Agreement or any other Transaction Document shall require the Owner Trustee to expend or risk funds or otherwise incur any financial liability in the performance of any of its rights or powers hereunder or under any Transaction Document if the Owner Trustee shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured or provided to it; (d) under no circumstances shall the Owner Trustee be liable for indebtedness evidenced by or arising under any of the Transaction Documents, including the principal of and interest on the Notes; (e) the Owner Trustee shall not be responsible for or in respect of the validity or sufficiency of this Agreement or for the due execution hereof by the Trust Depositor or for the form, character, genuineness, sufficiency, value or validity of any of the Trust Estate, or for or in respect of the validity or sufficiency of the Transaction Documents, other than the certificate of authentication on the Trust Certificate, and the Owner Trustee shall in no event assume or incur any liability, duty, or obligation to any Noteholder or to any Owner, other than as expressly provided for herein or expressly agreed to in the Transaction Documents; (f) the Owner Trustee shall not be liable for the default or misconduct of the Administrator, the Trust Depositor, the Indenture Trustee or the Servicer under any of the Transaction - 15 - Documents or otherwise and the Owner Trustee shall have no obligation or liability to perform the obligations of the Trust under this Agreement or the other Transaction Documents that are required to be performed by the Administrator under the Administration Agreement, the Indenture Trustee under the Indenture, or the Servicer or the Trust Depositor under the Sale and Servicing Agreement; and (g) the Owner Trustee shall be under no obligation to exercise any of the rights or powers vested in it by the Agreement, or to institute, conduct or defend any litigation under this Agreement or otherwise or in relation to this Agreement or any other Transaction Document, at the request, order or direction of the Owner, unless the Owner has offered to the Owner Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities that may be incurred by the Owner Trustee therein or thereby. The right of the Owner Trustee to perform any discretionary act enumerated in this Agreement or in any other Transaction Document shall not be construed as a duty, and the Owner Trustee shall not be answerable for other than its negligence or willful misconduct in the performance of any such act. SECTION 7.02. FURNISHING OF DOCUMENTS. The Owner Trustee shall furnish to the Owner promptly upon receipt of a written request therefor, duplicates or copies of all reports, notices, requests, demands, certificates, financial statements and any other instruments furnished to the Owner Trustee under the Transaction Documents. SECTION 7.03. REPRESENTATIONS AND WARRANTIES. The Owner Trustee hereby represents and warrants to the Trust Depositor and the Owner that: (a) It is a banking corporation duly organized and validly existing in good standing under the laws of the State of [_____]. It has all requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement. (b) It has taken all corporate action necessary to authorize the execution and delivery by it of this Agreement, and this Agreement will be executed and delivered by one of its officers who is duly authorized to execute and deliver this Agreement on its behalf. (c) Neither the execution nor the delivery by it of this Agreement, nor the consummation by it of the transactions contemplated hereby nor compliance by it with any of the terms or provisions hereof will contravene any federal or Delaware law, governmental rule or regulation governing the banking or trust powers of the Owner Trustee or any judgment or order binding on it, or constitute any default under its charter documents or bylaws or any indenture, mortgage, contract, agreement or instrument to which it is a party or by which any of its properties may be bound or result in the creation or imposition of any lien, charge or encumbrance on the Trust Estate resulting from actions by or claims against the Owner Trustee individually which are unrelated to this Agreement or the other Transaction Documents. SECTION 7.04. RELIANCE; ADVICE OF COUNSEL. (a) The Owner Trustee shall incur no liability to anyone in acting upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond or other document or paper believed by it to be genuine and believed by it to be signed by the proper party or parties. The Owner Trustee may accept a certified copy of a resolution of the board of directors or other - 16 - governing body of any corporate party as conclusive evidence that such resolution has been duly adopted by such body and that the same is in full force and effect. As to any fact or matter the method of determination of which is not specifically prescribed herein, the Owner Trustee may for all purposes hereof rely on a certificate, signed by the president or any vice president or by the treasurer or other authorized officers of the relevant party, as to such fact or matter and such certificate shall constitute full protection to the Owner Trustee for any action taken or omitted to be taken by it in good faith in reliance thereon. (b) In the exercise or administration of the trusts hereunder and in the performance of its duties and obligations under this Agreement or the other Transaction Documents, the Owner Trustee (i) may act directly or through its agents or attorneys pursuant to agreements entered into by any of them, and the Owner Trustee shall not be liable for the conduct or misconduct of such agents or attorneys as shall have been selected by the Owner Trustee with reasonable care, and (ii) may consult with counsel, accountants and other skilled persons to be selected with reasonable care and employed by it. The Owner Trustee shall not be liable for anything done, suffered or omitted in good faith by it in accordance with the written opinion or advice of any such counsel, accountants or other such persons. SECTION 7.05. NOT ACTING IN INDIVIDUAL CAPACITY. Except as provided in this Article Seven, in accepting the trusts hereby created, [_____] acts solely as Owner Trustee hereunder and not in its individual capacity, and all Persons having any claim against the Owner Trustee by reason of the transactions contemplated by this Agreement or any other Transaction Document shall look only to the Trust Estate for payment or satisfaction thereof. SECTION 7.06. OWNER TRUSTEE NOT LIABLE FOR TRUST CERTIFICATE, NOTES OR CONTRACTS. The recitals contained herein and in the Trust Certificate (other than the signature and countersignature of the Owner Trustee and the certificate of authentication on the Trust Certificate) shall be taken as the statements of the Trust Depositor, and the Owner Trustee assumes no responsibility for the correctness thereof. The Owner Trustee makes no representations as to the validity or sufficiency of this Agreement, any other Transaction Document or the Trust Certificate (other than the signature and countersignature of the Owner Trustee and the certificate of authentication on the Trust Certificate) or the Notes, or of any Contract or related documents. The Owner Trustee shall at no time have any responsibility or liability for or with respect to the legality, validity and enforceability of any Contract, or the perfection and priority of any security interest created by any Contract in any Motorcycle or the maintenance of any such perfection and priority, or for or with respect to the sufficiency of the Trust Estate or its ability to generate the payments to be distributed to the Certificateholder under this Agreement or the Noteholders under the Indenture, including, without limitation, the existence, condition and ownership of any Motorcycle; the existence and enforceability of any insurance thereon; the existence and contents of any Contract on any computer or other record thereof; the validity of the assignment of any Contract to the Trust or of any intervening assignment; the completeness of any Contract; the performance or enforcement of any Contract; the compliance by the Trust Depositor or the Servicer with any warranty or representation made under any Transaction Document or in any related document or the accuracy of any such warranty or representation; or any action of the Administrator, the Indenture Trustee or the Servicer or any subservicer taken in the name of the Owner Trustee. SECTION 7.07. OWNER TRUSTEE MAY OWN TRUST CERTIFICATE AND NOTES. The Owner Trustee in its individual or any other capacity may become the owner or pledgee of the Trust Certificate or Notes and - 17 - may deal with the Trust Depositor, the Administrator, the Indenture Trustee and the Servicer in banking transactions with the same rights as it would have if it were not Owner Trustee. ARTICLE EIGHT COMPENSATION OF OWNER TRUSTEE SECTION 8.01. OWNER TRUSTEE'S FEES AND EXPENSES. The Owner Trustee shall receive as compensation for its services hereunder such fees as have been separately agreed upon between the Owner Trustee and the Trust Depositor. Additionally, the Owner Trustee shall be entitled to be reimbursed by the Trust Depositor for its other reasonable expenses hereunder, including the reasonable compensation, expenses and disbursements of such agents, representatives, experts and counsel as the Owner Trustee may employ in connection with the exercise and performance of its rights and its duties hereunder. SECTION 8.02. INDEMNIFICATION. The Trust Depositor shall be liable as primary obligor for, and shall indemnify the Owner Trustee and its successors, assigns and servants (collectively, the "INDEMNIFIED PARTIES") from and against, any and all liabilities, obligations, losses, damages, taxes, claims, actions and suits, and any and all reasonable costs, expenses and disbursements (including reasonable legal fees and expenses) of any kind and nature whatsoever (collectively, "EXPENSES") which may at any time be imposed on, incurred by or asserted against the Owner Trustee or any Indemnified Party in any way relating to or arising out of this Agreement, the other Transaction Documents, the Trust Estate, the administration of the Trust Estate or the action or inaction of the Owner Trustee hereunder, except only that the Trust Depositor shall not be liable for or required to indemnify an Indemnified Party from and against Expenses arising or resulting from any of the matters described in the third sentence of Section 7.01. The indemnities contained in this Section shall survive the resignation or termination of the Owner Trustee or the termination of this Agreement. In the event of any claim, action or proceeding for which indemnity will be sought pursuant to this Section, the Owner Trustee's choice of legal counsel shall be subject to the approval of the Trust Depositor, which approval shall not be unreasonably withheld. SECTION 8.03. PAYMENTS TO THE OWNER TRUSTEE. Any amounts paid to the Owner Trustee pursuant to this Article shall be deemed not to be a part of the Trust Estate immediately after such payment. ARTICLE NINE TERMINATION OF TRUST AGREEMENT SECTION 9.01. TERMINATION OF TRUST AGREEMENT. (a) This Agreement (other than Article Eight) and the Trust shall terminate and be of no further force or effect upon the earlier of (i) final distribution by the Owner Trustee of all moneys or other property or proceeds of the Trust Estate in accordance with the terms of the Indenture, the Sale and Servicing Agreement and Article Five and (ii) the expiration of 21 years from the death of the survivor of the descendants of Joseph P. Kennedy, the late Ambassador of the United States to the Court of St. - 18 - James's, living on the date hereof. The bankruptcy, liquidation, dissolution, death or incapacity of any Owner shall not (i) operate to terminate this Agreement or the Trust, (ii) entitle such Owner's legal representatives or heirs to claim an accounting or to take any action or proceeding in any court for a partition or winding up of all or any part of the Trust or Trust Estate or (iii) otherwise affect the rights, obligations and liabilities of the parties hereto. (b) Except as provided in Section 9.01(a), neither the Trust Depositor nor any Holder shall be entitled to revoke or terminate the Trust. (c) Notice of any termination of the Trust, specifying the Distribution Date upon which the Certificateholder shall surrender the Trust Certificate to the Paying Agent for payment of the final distribution and cancellation, shall be given by the Owner Trustee by letter to the Certificateholder mailed within five Business Days of receipt of notice of such termination from the Servicer given pursuant to Section 10.01 of the Sale and Servicing Agreement, stating (i) the Distribution Date upon or with respect to which final payment of the Trust Certificate shall be made upon presentation and surrender of the Trust Certificate at the office of the Paying Agent therein designated, (ii) the amount of any such final payment and (iii) that the Record Date otherwise applicable to such Distribution Date is not applicable, payments being made only upon presentation and surrender of the Trust Certificate at the office of the Paying Agent therein specified. The Owner Trustee shall give such notice to the Certificate Registrar (if other than the Owner Trustee) and the Paying Agent at the time such notice is given to the Certificateholder. Upon presentation and surrender of the Trust Certificate, the Paying Agent shall cause to be distributed to the Certificateholder amounts distributable on such Distribution Date pursuant to Section 5.01. (d) Upon the winding up of the Trust and its termination, the Owner Trustee shall cause the Certificate of Trust to be canceled by filing a certificate of cancellation with the Secretary of State in accordance with the provisions of Section 3810 of the Statutory Trust Statute. ARTICLE TEN SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES SECTION 10.01. ELIGIBILITY REQUIREMENTS FOR OWNER TRUSTEE. The Owner Trustee shall at all times be a corporation satisfying the provisions of Section 3807(a) of the Statutory Trust Statute; authorized to exercise corporate trust powers; and (a) having a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by federal or state authorities; and having (or having a parent that has) a rating of at least Baa3 by Moody's; or (b) which the Rating Agencies have otherwise indicated in writing is an entity acceptable to act as Owner Trustee hereunder. If such corporation shall publish reports of condition at least annually pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purpose of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Owner Trustee shall cease to be eligible in accordance with the provisions of this Section, the Owner Trustee shall resign immediately in the manner and with the effect specified in Section 10.02. - 19 - SECTION 10.02. RESIGNATION OR REMOVAL OF OWNER TRUSTEE. The Owner Trustee may at any time resign and be discharged from the trusts hereby created by giving written notice thereof to the Administrator. Upon receiving such notice of resignation, the Administrator shall promptly appoint a successor Owner Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the resigning Owner Trustee and one copy to the successor Owner Trustee. If no successor Owner Trustee shall have been so appointed and have accepted appointment within 30 days after the giving of such notice of resignation, the resigning Owner Trustee may petition any court of competent jurisdiction for the appointment of a successor Owner Trustee. If at any time the Owner Trustee shall cease to be eligible in accordance with the provisions of Section 10.01 and shall fail to resign after written request therefor by the Administrator, or if at any time the Owner Trustee shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a receiver of the Owner Trustee or of its property shall be appointed or any public officer shall take charge or control of the Owner Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then the Administrator, may remove the Owner Trustee. If the Administrator shall remove the Owner Trustee under the authority of the immediately preceding sentence, the Administrator shall promptly appoint a successor Owner Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the outgoing Owner Trustee so removed and one copy to the successor Owner Trustee, and shall pay all fees owed to the outgoing Owner Trustee. Any resignation or removal of the Owner Trustee and appointment of a successor Owner Trustee pursuant to any of the provisions of this Section shall not become effective until acceptance of appointment by the successor Owner Trustee pursuant to Section 10.03 and payment of all fees and expenses owed to the outgoing Owner Trustee. The Administrator shall provide notice of such resignation or removal of the Owner Trustee to each Rating Agency. SECTION 10.03. SUCCESSOR OWNER TRUSTEE. Any successor Owner Trustee appointed pursuant to Section 10.02 shall execute, acknowledge and deliver to the Administrator, and to its predecessor Owner Trustee an instrument accepting such appointment under this Agreement, and thereupon the resignation or removal of the predecessor Owner Trustee shall become effective, and such successor Owner Trustee, without any further act, deed or conveyance, shall become fully vested with all the rights, powers, duties and obligations of its predecessor under this Agreement, with like effect as if originally named as Owner Trustee. The predecessor Owner Trustee shall upon payment of its fees and expenses deliver to the successor Owner Trustee all documents and statements and monies held by it under this Agreement; and the Administrator and the predecessor Owner Trustee shall execute and deliver such instruments and do such other things as may reasonably be required for fully and certainly vesting and confirming in the successor Owner Trustee all such rights, powers, duties and obligations. No successor Owner Trustee shall accept appointment as provided in this Section unless at the time of such acceptance such successor Owner Trustee shall be eligible pursuant to Section 10.01. Upon acceptance of appointment by a successor Owner Trustee pursuant to this Section, the Administrator shall mail notice thereof to the Certificateholder, the Indenture Trustee, the Noteholders and each Rating Agency. If the Administrator shall fail to mail such notice within ten days after acceptance of such appointment by the successor Owner Trustee, the successor Owner Trustee shall cause such notice to be mailed at the expense of the Administrator. - 20 - SECTION 10.04. MERGER OR CONSOLIDATION OF OWNER TRUSTEE. Any corporation into which the Owner Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Owner Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Owner Trustee, shall be the successor of the Owner Trustee hereunder, without the execution or filing of any instrument or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding; PROVIDED, that such corporation shall be eligible pursuant to Section 10.01 and, PROVIDED, FURTHER, that the Owner Trustee shall mail notice of such merger or consolidation to each Rating Agency. SECTION 10.05. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. Notwithstanding any other provisions of this Agreement, at any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Trust Estate or any financed Motorcycle may at the time be located, the Administrator and the Owner Trustee acting jointly shall have the power and shall execute and deliver all instruments to appoint one or more Persons approved by the Administrator and Owner Trustee to act as co-trustee, jointly with the Owner Trustee, or as separate trustee or separate trustees, of all or any part of the Trust Estate, and to vest in such Person, in such capacity, such title to the Trust or any part thereof and, subject to the other provisions of this Section, such powers, duties, obligations, rights and trusts as the Administrator and the Owner Trustee may consider necessary or desirable. If the Administrator shall not have joined in such appointment within 15 days after the receipt by it of a request so to do, the Owner Trustee alone shall have the power to make such appointment. No co-trustee or separate trustee under this Agreement shall be required to meet the terms of eligibility as a successor Owner Trustee pursuant to Section 10.01 and no notice of the appointment of any co-trustee or separate trustee shall be required pursuant to Section 10.03. Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: (a) all rights, powers, duties and obligations conferred or imposed upon the Owner Trustee shall be conferred upon and exercised or performed by the Owner Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co-trustee is not authorized to act separately without the Owner Trustee joining in such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed, the Owner Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding of title to the Trust Estate or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee, but solely at the direction of the Owner Trustee; (b) no trustee under this Agreement shall be personally liable by reason of any act or omission of any other trustee under this Agreement; and (c) the Administrator and the Owner Trustee acting jointly may at any time accept the resignation of or remove any separate trustee or co-trustee. Any notice, request or other writing given to the Owner Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Agreement and the conditions of this Article. Each separate trustee and co-trustee, upon its acceptance of the trusts - 21 - conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Owner Trustee or separately, as may be provided therein, subject to all the provisions of this Agreement, specifically including every provision of this Agreement relating to the conduct of, affecting the liability of or affording protection to, the Owner Trustee. Each such instrument shall be filed with the Owner Trustee and a copy thereof given to the Administrator. Any separate trustee or co-trustee may at any time appoint the Owner Trustee as its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Agreement on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Owner Trustee, to the extent permitted by law, without the appointment of a new or successor co-trustee or separate trustee. ARTICLE ELEVEN MISCELLANEOUS SECTION 11.01. SUPPLEMENTS AND AMENDMENTS. (a) The Agreement may be amended by the Trust Depositor, and the Owner Trustee, without the consent of any of the Noteholders or the Certificateholder, to cure any ambiguity, to correct or supplement any provisions in this Agreement or to add any other provisions with respect to matters or questions arising under this Agreement that shall not be inconsistent with the provisions of this Agreement; PROVIDED, HOWEVER, that any such action shall not, as evidenced by an Opinion of Counsel, adversely affect in any material respect the interests of any Noteholder or Certificateholder. (b) This Agreement may also be amended from time to time by the Trust Depositor, and the Owner Trustee, with the consent of the Modified Required Holders, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement, or of modifying in any manner the rights of the Noteholders or the Certificateholder; PROVIDED, HOWEVER, that no such amendment shall increase or reduce in any manner the amount of, or accelerate or delay the timing of, (i) collections of payments on Contracts or distributions that shall be required to be made for the benefit of the Noteholders or the Certificateholder, or (ii) eliminate the Certificateholder consent or reduce the aforesaid percentage of the Outstanding Amount of the Notes required to consent to any such amendment, without the consent of the Holder of all outstanding Notes and the Trust Certificate. (c) Prior to the execution of any such amendment or consent, the Trust Depositor shall furnish written notification of the substance of such amendment or consent, together with a copy thereof, to the Indenture Trustee, the Administrator and each Rating Agency. (d) Promptly after the execution of any such amendment or consent, the Owner Trustee shall furnish written notification of the substance of such amendment or consent to each Certificateholder. It shall not be necessary for the consent of Certificateholder, Noteholders or the Indenture Trustee pursuant to this Section to approve the particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof. The manner of - 22 - obtaining such consents (and any other consents of the Certificateholder provided for in this Agreement or in any other Transaction Document) and of evidencing the authorization of the execution thereof by the Certificateholder shall be subject to such reasonable requirements as the Owner Trustee may prescribe. (e) Promptly after the execution of any amendment to the Certificate of Trust, the Owner Trustee shall cause the filing of such amendment with the Secretary of State. (f) Prior to the execution of any amendment to this Agreement or the Certificate of Trust, the Owner Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement. The Owner Trustee may, but shall not be obligated to, enter into any such amendment that affects the Owner Trustee's own rights, duties or immunities under this Agreement or otherwise. SECTION 11.02. NO LEGAL TITLE TO TRUST ESTATE IN OWNER. The Owner shall not have legal title to any part of the Trust Estate. The Owner shall be entitled to receive distributions with respect to their undivided ownership interest herein only in accordance with Articles Five and Nine. No transfer, by operation of law or otherwise, of any right, title or interest of the Owner to and in their ownership interest in the Trust Estate shall operate to terminate this Agreement or the trusts hereunder or entitle any transferee to an accounting or to the transfer to it of legal title to any part of the Trust Estate. SECTION 11.03. LIMITATIONS ON RIGHTS OF OTHERS. Except for Section 2.07, the provisions of this Agreement are solely for the benefit of the Owner Trustee, the Trust Depositor, the Owner, the Administrator and, to the extent expressly provided herein, the Indenture Trustee and the Noteholders, and nothing in this Agreement (other than Section 2.07), whether express or implied, shall be construed to give to any other Person any legal or equitable right, remedy or claim in the Trust Estate or under or in respect of this Agreement or any covenants, conditions or provisions contained herein. SECTION 11.04. NOTICES. All notices, demands, certificates, requests and communications hereunder ("NOTICES") shall be in writing and shall be effective (a) upon receipt when sent through the U.S. mails, registered or certified mail, return receipt requested, postage prepaid, with such receipt to be effective the date of delivery indicated on the return receipt, or (b) one Business Day after delivery to an overnight courier, or (c) on the date personally delivered to an Authorized Officer of the party to which sent, or (d) on the date transmitted by legible telecopier transmission with a confirmation of receipt, in all cases addressed to the recipient at the address for such recipient set forth in the Sale and Servicing Agreement. Each party hereto may, by notice given in accordance herewith to each of the other parties hereto, designate any further or different address to which subsequent notices shall be sent. SECTION 11.05. SEVERABILITY OF PROVISIONS. If any one or more of the covenants, agreements, provisions, or terms of this Agreement shall be for any reason whatsoever held invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement or of the Trust Certificate or the rights of the Holder thereof. SECTION 11.06. COUNTERPARTS. This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. - 23 - SECTION 11.07. SUCCESSORS AND ASSIGNS. All covenants and agreements contained herein shall be binding upon, and inure to the benefit of, each of the Trust Depositor, and the Owner Trustee and their respective successors and permitted assigns and each Owner and its successors and permitted assigns, all as herein provided. Any request, notice, direction, consent, waiver or other instrument or action by an Owner shall bind the successors and assigns of such Owner. SECTION 11.08. COVENANTS OF THE TRUST DEPOSITOR. In the event that any litigation with claims in excess of $1,000,000 to which the Trust Depositor is a party which shall be reasonably likely to result in a material judgment against the Trust Depositor that the Trust Depositor will not be able to satisfy shall be commenced, during the period beginning immediately following the commencement of such litigation and continuing until such litigation is dismissed or otherwise terminated (and, if such litigation has resulted in a final judgment against the Trust Depositor, such judgment has been satisfied), the Trust Depositor shall not pay any dividend to the Servicer, or make any distribution on or in respect of its capital stock to the Servicer, or repay the principal amount of any indebtedness of the Trust Depositor held by the Servicer, unless (i) after giving effect to such payment, distribution or repayment, the Trust Depositor's liquid assets shall not be less than the amount of actual damages claimed in such litigation or (ii) the Rating Agencies shall not downgrade the then existing rating on the Certificate with respect to any such payment, distribution or repayment. SECTION 11.09. NO PETITION. (a) The Trust Depositor will not at any time institute against the Trust any bankruptcy proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Trust Certificate, the Notes, this Agreement or any of the other Transaction Documents. (b) The Owner Trustee, by entering into this Agreement, each Certificateholder, by accepting a Trust Certificate, and the Indenture Trustee and each Noteholder, by accepting the benefits of this Agreement, hereby covenant and agree that they will not at any time institute against the Trust Depositor or the Trust, or join in any institution against the Trust Depositor, or the Trust of, any bankruptcy proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Trust Certificate, the Notes, this Agreement or any of the other Transaction Documents. SECTION 11.10. NO RECOURSE. The Certificateholder by accepting the Trust Certificate acknowledges that such Certificateholder's Trust Certificate represents beneficial interests in the Trust only and does not represent interests in or obligations of the Trust Depositor, the Servicer, the Seller, the Administrator, the Owner Trustee, the Indenture Trustee or any of the respective Affiliates (other than the Trust) and no recourse may be had against such parties or their assets, except as may be expressly set forth or contemplated in this Agreement, the Trust Certificate or the other Transaction Documents. SECTION 11.11. HEADINGS. The headings of the various Articles and Sections herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof. SECTION 11.12. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO - 24 - ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. SECTION 11.13. TRUST CERTIFICATE TRANSFER RESTRICTIONS. The Trust Certificate may not be acquired by or for the account of a Benefit Plan. By accepting and holding a Trust Certificate, the Holder thereof shall be deemed to have represented and warranted that it is not a Benefit Plan and that it is not acquiring and will not hold such Trust Certificate for the account of, or with plan assets of, a Benefit Plan. SECTION 11.14. TRUST DEPOSITOR PAYMENT OBLIGATION. The Trust Depositor shall be responsible for payment of the Administrator's compensation pursuant to Section 3 of the Administration Agreement and shall reimburse the Administrator for all expenses and liabilities of the Administrator incurred thereunder. [signature page follows] - 25 - IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers hereunto duly authorized, as of the day and year first above written. HARLEY-DAVIDSON CUSTOMER FUNDING CORP., as Trust Depositor By: ----------------------------- Printed Name: Title: [______], as Owner Trustee By: ----------------------------- Printed Name: ------------------ Title: -------------------------- SIGNATURE PAGE TO TRUST AGREEMENT EXHIBIT A FORM OF CERTIFICATE OF TRUST OF Harley-Davidson Motorcycle Trust [_____] This Certificate of Trust of Harley-Davidson Motorcycle Trust [_____] (the "TRUST"), dated [_____], is being duly executed and filed by [_____], a [_____], as Owner Trustee, to form a statutory trust under the Delaware Statutory Trust Act (12 DEL. CODE, Section 3801 ET SEQ.). 1. NAME. The name of the statutory trust formed hereby is Harley-Davidson Motorcycle Trust [_____]. 2. DELAWARE TRUSTEE. The name and business address of the Owner Trustee of the Trust in the State of Delaware is [_____]. IN WITNESS WHEREOF, the undersigned, being the sole Owner Trustee of the Trust, has executed this Certificate of Trust as of the date first above written. [______], not in its individual capacity but solely as Owner Trustee By: ----------------------------------------------- Printed Name: --------------------------- Title: ---------------------------------- EXHIBIT B FORM OF TRUST CERTIFICATE THIS TRUST CERTIFICATE REPRESENTS THE BENEFICIAL INTEREST IN THE TRUST (AS DEFINED BELOW) AND IS ENTITLED TO PAYMENTS AS DESCRIBED IN THE SALE AND SERVICING AGREEMENT AND INDENTURE REFERRED TO HEREIN. THIS TRUST CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR AN INTEREST IN HARLEY-DAVIDSON CUSTOMER FUNDING CORP., HARLEY-DAVIDSON CREDIT CORP. OR ANY AFFILIATE THEREOF, EXCEPT TO THE EXTENT SET FORTH IN THE TRUST AGREEMENT. THIS TRUST CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR PLEDGED UNLESS THE CONDITIONS SET FORTH IN SECTIONS 3.01, 3.04 AND 11.13 OF THE TRUST AGREEMENT HAVE BEEN COMPLIED WITH. HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] CERTIFICATE NO. ___________ Initial Trust Certificate Fractional Interest 100% THIS CERTIFIES THAT Harley-Davidson Customer Funding Corp. is the registered owner of 100% of the non-assessable, fully-paid, fractional undivided beneficial interest in the Harley-Davidson Motorcycle Trust [_____] (the "TRUST") formed by Harley-Davidson Customer Funding Corp., a Nevada corporation (the "TRUST DEPOSITOR"). The Trust was created pursuant to a Trust Agreement, dated as of [_____] (as amended and supplemented from time to time, the "TRUST AGREEMENT"), between the Trust Depositor, and [_____], as owner trustee (the "OWNER TRUSTEE"), a summary of certain of the pertinent provisions of which is set forth below. To the extent not otherwise defined herein, the capitalized terms used herein have the meanings assigned to them in (i) the Trust Agreement, (ii) the Sale and Servicing Agreement, dated as of [_____] (the "SALE AND SERVICING AGREEMENT"), among the Trust, the Trust Depositor, Harley-Davidson Credit Corp. ("HARLEY-DAVIDSON CREDIT"), as Servicer (in such capacity, the "SERVICER") and [_____], as Indenture Trustee (the "INDENTURE TRUSTEE") or (iii) the Indenture, dated as of [_____] (the "INDENTURE"), between the Trust and the Indenture Trustee. This Trust Certificate is the duly authorized Trust Certificate designated as "HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] CERTIFICATE" (the "TRUST CERTIFICATE"). Issued under the Indenture are three classes of notes designated as "____% HARLEY-DAVIDSON MOTORCYCLE CONTRACT BACKED NOTES, CLASS A-1", "____% HARLEY-DAVIDSON MOTORCYCLE CONTRACT BACKED NOTES, CLASS A-2" and "____% HARLEY-DAVIDSON MOTORCYCLE CONTRACT BACKED NOTES, CLASS B" (collectively, the "NOTES"). This Trust Certificate is issued under and is subject to the terms, provisions and conditions of the Trust Agreement, to which Trust Agreement the Holder of this Trust Certificate by virtue of its acceptance hereof assents and by which such Holder is bound. The property of the Trust includes, among other things, (i) all the right, title and interest of the Trust Depositor in and to the Initial Contracts listed on the initial List of Contracts delivered on the Closing Date (including, without limitation, all security interests and all rights to receive payments which are collected pursuant thereto after the Initial Cutoff Date, including any liquidation proceeds therefrom, but excluding any rights to receive payments which were collected pursuant thereto on or prior to the Initial Cutoff Date), (ii) all rights of the Trust Depositor under any physical damage or other individual insurance policy (and rights under a "FORCED PLACED" policy, if any), any debt insurance policy or any debt cancellation agreement relating to any such Contract, an Obligor or a Motorcycle securing such Contract, (iii) all security interests in each such Motorcycle, (iv) all documents contained in the related Contract Files, (v) all rights (but not the obligations) of the Trust Depositor under any related motorcycle dealer agreements between dealers (i.e., the originators of such Contracts) and Harley-Davidson Credit, (vi) all rights of the Trust Depositor in the Lockbox, the Lockbox Account and related Lockbox Agreement to the extent they relate to such Contracts, (vii) all rights (but not the obligations) of the Trust Depositor under the Transfer and Sale Agreement, including but not limited to the Trust Depositor's rights under Article V thereof, (viii) the remittances, deposits and payments made into the Trust Accounts from time to time and amounts in the Trust Accounts from time to time (and any investments of such amounts), (ix) all rights of the Trust Depositor to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Contracts and (x) all proceeds and products of the foregoing. Under the Trust Agreement, there will be distributed on the fifteenth day of each month or if such day is not a Business Day the next succeeding Business Day commencing [_____] (each, a "DISTRIBUTION DATE") to the person in whose name this Trust Certificate is registered as of the last Business Day immediately preceding the calendar month in which such Distribution Date occurs (each, a "RECORD DATE"), such Certificateholder's fractional undivided beneficial interest in the amount to be distributed to the Certificateholder on such Distribution Date. The holder of this Trust Certificate acknowledges and agrees that its rights to receive distributions in respect of this Trust Certificate are subordinated to the rights of the Noteholders to the extent described in the Sale and Servicing Agreement and the Indenture. It is the intention of Harley-Davidson Credit, the Servicer, the Trust Depositor, Owner Trustee, Indenture Trustee and the Certificateholder that the Trust be disregarded as a separate entity pursuant to Treasury Regulations Section 301.7701-3(b)(1)(ii) as in effect for periods after January 1, 1997. The Trust Certificate constitutes the sole equity interest in the Trust and must at all times be held by either the Trust Depositor or its transferee as sole owner. The Trust Depositor agrees not to take any action inconsistent with such intended federal income tax treatment. Because for federal income tax purposes the Trust will be disregarded as a separate entity, Trust items of income, gain, loss and deduction for any month as determined for federal income tax purposes shall be allocated entirely to the Trust Depositor (or subsequent purchaser of the Trust Certificate) as the sole Certificateholder. Each Certificateholder, by its acceptance of a Trust Certificate or beneficial interest in a Trust Certificate, covenants and agrees that such Certificateholder will not at any time institute against the Trust or the Trust Depositor, or join in any institution against the Trust or the Trust Depositor, Harley-Davidson Credit or the Servicer any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Trust Certificate, the Notes, the Trust Agreement or any of the other Transaction Documents. Distributions on this Trust Certificate will be made as provided in the Sale and Servicing Agreement by wire transfer or check mailed to the Certificateholder of record in the Certificate Register without the presentation or surrender of this Trust Certificate or the making of any notation hereon. Except as otherwise provided in the Trust Agreement and notwithstanding the above, the final distribution on this Trust Certificate will be made after due notice by the Owner Trustee of the pendency of such distribution and only upon presentation and surrender of this Trust Certificate at the office or agency maintained for that purpose by the Owner Trustee in the City of Wilmington, Delaware. Reference is hereby made to the further provisions of this Trust Certificate set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place. Unless the certificate of authentication hereon shall have been executed by an authorized officer of the Owner Trustee, by manual signature, this Trust Certificate shall not entitle the holder hereof to any benefit under the Trust Agreement or any other Transaction Document or be valid for any purpose. THIS TRUST CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. [REVERSE OF CERTIFICATE] The Trust Certificate does not represent an obligation of, or an interest in the Trust Depositor, Harley-Davidson Credit, as the Seller or Servicer, the Owner Trustee, the Indenture Trustee or any of their respective Affiliates (other than the Trust) and no recourse may be had against such parties or their assets, except as expressly set forth or contemplated herein or in the Trust Agreement or the other Transaction Documents. In addition, this Trust Certificate is not guaranteed by any governmental agency or instrumentality and is limited in right of payment to certain collections and recoveries with respect to the Contracts and certain other amounts, in each case as more specifically set forth herein and in the Sale and Servicing Agreement. A copy of each of the Sale and Servicing Agreement and the Trust Agreement may be examined by any Certificateholder upon written request during normal business hours at the principal office of the Trust Depositor and at such other places, if any, designated by the Trust Depositor. The Trust Agreement permits, with certain exceptions therein provided, the amendment thereof and the modification of the rights and obligations of the Trust Depositor and the rights of the Certificateholder under the Trust Agreement at any time by the Trust Depositor and the Owner Trustee with the consent of the Holder of the Trust Certificate and the Modified Required Holders. Any such consent by the Holder of this Trust Certificate shall be conclusive and binding on such Holder and on all future Holders of this Trust Certificate and of any Trust Certificate issued upon the transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent is made upon this Trust Certificate. The Trust Agreement also permits the amendment thereof, in certain limited circumstances, without the consent of the Holder of any of the Trust Certificate. As provided in the Trust Agreement and subject to certain limitations therein set forth, the transfer of this Trust Certificate is registerable in the Certificate Register upon surrender of this Trust Certificate for registration of transfer at the offices or agencies of the Certificate Registrar, accompanied by a written instrument of transfer in form satisfactory to the Owner Trustee and the Certificate Registrar duly executed by the Holder hereof or such Holder's attorney duly authorized in writing, and thereupon the new Trust Certificate of authorized denominations evidencing the same aggregate interest in the Trust will be issued to the designated transferee. The initial Certificate Registrar appointed under the Trust Agreement is the Owner Trustee. The Owner Trustee, the Certificate Registrar and any of their respective agents may treat the Person in whose name this Trust Certificate is registered as the owner hereof for all purposes, and none of the Owner Trustee, the Certificate Registrar or any such agent shall be affected by any notice to the contrary. The obligations and responsibilities created by the Trust Agreement and the Trust created thereby shall terminate upon the payment to the Certificateholder of all amounts required to be paid to it pursuant to the Trust Agreement and the Sale and Servicing Agreement and the disposition of all property held as part of the Trust Estate. Harley-Davidson Credit may at its option purchase the Trust Estate at a price specified in the Sale and Servicing Agreement, and such purchase of the Contracts and other property of the Trust will affect early retirement of the Trust Certificate; however, such right of purchase is exercisable only as of any Distribution Date on which the Pool Balance has declined to less than 10% of the sum of (i) the initial Pool Balance on the Initial Cutoff Date and (ii) the Pre-Funded Amount as of the Closing Date. The Trust Certificate may not be acquired by a Benefit Plan. The Holder hereof, by accepting a beneficial interest in this Trust Certificate, shall be deemed to have represented and warranted that it is not a Benefit Plan and is not acquiring this Trust Certificate or an interest therein for the account of, or with plan assets of, a Benefit Plan. IN WITNESS WHEREOF, the Owner Trustee, on behalf of the Trust and not in its individual capacity, has caused this Trust Certificate to be duly executed. Dated: Harley-Davidson Motorcycle Trust [_____] By: [_____], not in its individual capacity but solely as Owner Trustee By: ---------------------------------- Authorized Signatory OWNER TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is the Trust Certificate referred to in the within-mentioned Trust Agreement. [_____], not in its individual capacity but solely as Owner Trustee By: --------------------------------- Authorized Signatory ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE (Please print or type name and address, including postal zip code, of assignee) ________________________________________________________________________________ the within Trust Certificate, and all rights thereunder, hereby irrevocably constituting and appointing ________________________________________________________________________________ to transfer said Trust Certificate on the books of the Certificate Registrar, with full power of substitution in the premises. Dated: -------------- Signature Guaranteed: - ------------------------------------------ ------------------------------------ NOTICE: Signature(s) must be guaranteed by NOTICE: The signature to this an eligible guarantor institution. assignment must correspond with the name of the registered owner as it appears on the face of the within Trust Certificate in every particular, without alteration or enlargement or any change whatever. EX-4.2 3 a2158269zex-4_2.txt EXHIBIT 4.2 EXHIBIT 4.2 ================================================================================ HARLEY-DAVIDSON MOTORCYCLE TRUST [_____], as Issuer, and [_____], not in its individual capacity but solely in its capacity as Indenture Trustee ---------- INDENTURE Dated as of [_____] ---------- $[_________] [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-1 $[_________] [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-2 $[_________] [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class B ================================================================================ CROSS-REFERENCE TABLE
TIA Indenture Section Section - ------- ------- 310(a)(1)...........................................................6.11 (a)(2)...........................................................6.11 (a)(3)...........................................................6.10 (a)(4)...........................................................N.A. (a)(5)...........................................................6.11 (b).................................................6.08; 6.11; 11.04 (c)..............................................................N.A. 311(a)..............................................................6.13 (b)..............................................................6.13 (c)..............................................................N.A. 312(a).. .....................................................7.01; 7.02 (b)..............................................................7.02 (c)..............................................................7.02 313(a).. ...........................................................7.04 (b)..............................................................7.04 (c)..............................................................7.04 (d)..............................................................7.04 314(a)..............................................................7.03 (b)..............................................................3.06 (c)(1)..............................................2.02; 6.02; 11.01 (c)(2)..........................................................11.01 (c)(3)..........................................................11.01 (d).............................................................11.01 (e).............................................................11.01 (f)..............................................................N.A. 315(a)..............................................................6.01 (b)..............................................................6.05 (c)..............................................................6.01 (d)........................................................5.12; 6.01 (e)..............................................................5.14 316(a)(1)(A)........................................................5.12 (a)(1)(B)........................................................5.02 (a)(2)...........................................................N.A. (b)..............................................................5.08 (c)..............................................................N.A. 317(a)........................................................5.03; 5.04 (b)..............................................................3.03 318(a).............................................................11.18
---------- * N.A. means Not Applicable * This Cross-Reference Table shall not, for any purpose, be deemed to be a part of the Indenture. i TABLE OF CONTENTS
Page ---- ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE.........................................2 SECTION 1.01. DEFINITIONS...........................................................................2 SECTION 1.02. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT....................................10 SECTION 1.03. RULES OF CONSTRUCTION................................................................10 ARTICLE TWO THE NOTES.........................................................................11 SECTION 2.01. FORM.................................................................................11 SECTION 2.02. EXECUTION, AUTHENTICATION AND DELIVERY...............................................11 SECTION 2.03. TEMPORARY NOTES......................................................................11 SECTION 2.04. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE..................................12 SECTION 2.05. MUTILATED, DESTROYED, LOST OR STOLEN NOTES...........................................14 SECTION 2.06. PERSONS DEEMED OWNER.................................................................15 SECTION 2.07. PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED INTEREST................................15 SECTION 2.08. CANCELLATION.........................................................................16 SECTION 2.09. BOOK-ENTRY NOTES.....................................................................16 SECTION 2.10. NOTICES TO CLEARING AGENCY...........................................................17 SECTION 2.11. DEFINITIVE NOTES.....................................................................17 SECTION 2.12. RELEASE OF COLLATERAL................................................................18 SECTION 2.13. TAX TREATMENT........................................................................18 ARTICLE THREE COVENANTS.........................................................................18 SECTION 3.01. PAYMENT OF PRINCIPAL AND INTEREST....................................................18 SECTION 3.02. MAINTENANCE OF OFFICE OR AGENCY......................................................18 SECTION 3.03. MONEY FOR PAYMENTS TO BE HELD IN TRUST...............................................19 SECTION 3.04. EXISTENCE............................................................................20 SECTION 3.05. PROTECTION OF COLLATERAL.............................................................20 SECTION 3.06. OPINIONS AS TO COLLATERAL............................................................21 SECTION 3.07. PERFORMANCE OF OBLIGATIONS; SERVICING OF CONTRACTS...................................21 SECTION 3.08. NEGATIVE COVENANTS...................................................................22 SECTION 3.09. ANNUAL STATEMENT AS TO COMPLIANCE....................................................23 SECTION 3.10. ISSUER MAY CONSOLIDATE, ETC. ONLY ON CERTAIN TERMS...................................23 SECTION 3.11. SUCCESSOR OR TRANSFEREE..............................................................25 SECTION 3.12. NO OTHER BUSINESS....................................................................25 SECTION 3.13. NO BORROWING.........................................................................25 SECTION 3.14. SERVICER'S OBLIGATIONS...............................................................25 SECTION 3.15. GUARANTEES, LOANS ADVANCES AND OTHER LIABILITIES.....................................26 SECTION 3.16. CAPITAL EXPENDITURES.................................................................26 SECTION 3.17. RESTRICTED PAYMENTS..................................................................26 SECTION 3.18. NOTICE OF EVENTS OF DEFAULT..........................................................26 SECTION 3.19. FURTHER INSTRUMENTS AND ACTS.........................................................26 SECTION 3.20. COMPLIANCE WITH LAWS.................................................................26
ii SECTION 3.21. AMENDMENTS OF SALE AND SERVICING AGREEMENT AND TRUST AGREEMENT.......................26 SECTION 3.22. REMOVAL OF ADMINISTRATOR.............................................................27 ARTICLE FOUR SATISFACTION AND DISCHARGE........................................................27 SECTION 4.01. SATISFACTION AND DISCHARGE OF INDENTURE..............................................27 SECTION 4.02. APPLICATION OF TRUST MONEY...........................................................28 SECTION 4.03. REPAYMENT OF MONEYS HELD BY PAYING AGENT.............................................28 SECTION 4.04. RELEASE OF COLLATERAL................................................................28 ARTICLE FIVE REMEDIES..........................................................................28 SECTION 5.01. EVENTS OF DEFAULT....................................................................28 SECTION 5.02. RIGHTS UPON EVENT OF DEFAULT.........................................................30 SECTION 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY INDENTURE TRUSTEE; AUTHORITY OF INDENTURE TRUSTEE.......................................................30 SECTION 5.04. REMEDIES.............................................................................32 SECTION 5.05. OPTIONAL PRESERVATION OF THE CONTRACTS...............................................33 SECTION 5.06. PRIORITIES...........................................................................33 SECTION 5.07. LIMITATION OF SUITS..................................................................33 SECTION 5.08. UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL AND INTEREST................34 SECTION 5.09. RESTORATION OF RIGHTS AND REMEDIES...................................................34 SECTION 5.10. RIGHTS AND REMEDIES CUMULATIVE.......................................................35 SECTION 5.11. DELAY OR OMISSION NOT A WAIVER.......................................................35 SECTION 5.12. CONTROL BY NOTEHOLDERS...............................................................35 SECTION 5.13. WAIVER OF PAST DEFAULTS..............................................................35 SECTION 5.14. UNDERTAKING FOR COSTS................................................................36 SECTION 5.15. WAIVER OF STAY OR EXTENSION LAWS.....................................................36 SECTION 5.16. ACTION ON NOTES......................................................................36 SECTION 5.17. PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS...................................36 ARTICLE SIX THE INDENTURE TRUSTEE.............................................................37 SECTION 6.01. DUTIES OF INDENTURE TRUSTEE..........................................................37 SECTION 6.02. RIGHTS OF INDENTURE TRUSTEE..........................................................38 SECTION 6.03. INDIVIDUAL RIGHTS OF INDENTURE TRUSTEE...............................................39 SECTION 6.04. INDENTURE TRUSTEE'S DISCLAIMER.......................................................40 SECTION 6.05. NOTICE OF DEFAULTS...................................................................40 SECTION 6.06. REPORTS BY INDENTURE TRUSTEE TO HOLDERS..............................................40 SECTION 6.07. COMPENSATION AND INDEMNITY...........................................................40 SECTION 6.08. REPLACEMENT OF INDENTURE TRUSTEE.....................................................41 SECTION 6.09. SUCCESSOR INDENTURE TRUSTEE BY MERGER................................................42 SECTION 6.10. APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE INDENTURE TRUSTEE....................42 SECTION 6.11. ELIGIBILITY..........................................................................44 SECTION 6.12. PENNSYLVANIA MOTOR VEHICLE SALES FINANCE ACT LICENSES................................45 SECTION 6.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER.....................................45 ARTICLE SEVEN NOTEHOLDERS' LISTS AND REPORTS....................................................45

iii SECTION 7.01. ISSUER TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES OF NOTEHOLDERS...............45 SECTION 7.02. PRESERVATION OF INFORMATION: COMMUNICATION TO NOTEHOLDERS............................45 SECTION 7.03. REPORTS BY ISSUER....................................................................46 SECTION 7.04. REPORTS BY INDENTURE TRUSTEE.........................................................46 ARTICLE EIGHT ACCOUNTS, DISBURSEMENTS AND RELEASES..............................................46 SECTION 8.01. COLLECTION OF MONEY..................................................................46 SECTION 8.02. TRUST ACCOUNTS.......................................................................47 SECTION 8.03. GENERAL PROVISIONS REGARDING ACCOUNTS................................................47 SECTION 8.04. RELEASE OF COLLATERAL................................................................48 SECTION 8.05. OPINION OF COUNSEL...................................................................48 ARTICLE NINE SUPPLEMENTAL INDENTURES...........................................................49 SECTION 9.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS...............................49 SECTION 9.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS..................................50 SECTION 9.03. EXECUTION OF SUPPLEMENTAL INDENTURES.................................................51 SECTION 9.04. EFFECT OF SUPPLEMENTAL INDENTURE.....................................................51 SECTION 9.05. CONFORMITY WITH TRUST INDENTURE ACT..................................................52 SECTION 9.06. REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES........................................52 ARTICLE TEN REDEMPTION OF NOTES...............................................................52 SECTION 10.01. REDEMPTION...........................................................................52 SECTION 10.02. FORM OF REDEMPTION NOTICE............................................................53 SECTION 10.03. NOTES PAYABLE ON REDEMPTION DATE.....................................................53 ARTICLE ELEVEN MISCELLANEOUS.....................................................................54 SECTION 11.01. COMPLIANCE CERTIFICATES AND OPINIONS, ETC............................................54 SECTION 11.02. FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE.....................................55 SECTION 11.03. ACTS OF NOTEHOLDERS..................................................................56 SECTION 11.04. NOTICES..............................................................................57 SECTION 11.05. NOTICES TO NOTEHOLDERS; WAIVER.......................................................57 SECTION 11.06. ALTERNATE PAYMENT AND NOTICE PROVISIONS..............................................57 SECTION 11.07. EFFECT OF HEADINGS AND TABLE OF CONTENTS.............................................58 SECTION 11.08. SUCCESSORS AND ASSIGNS...............................................................58 SECTION 11.09. SEPARABILITY.........................................................................58 SECTION 11.10. BENEFITS OF INDENTURE................................................................58 SECTION 11.11. LEGAL HOLIDAYS.......................................................................58 SECTION 11.12. GOVERNING LAW........................................................................58 SECTION 11.13. COUNTERPARTS.........................................................................58 SECTION 11.14. RECORDING OF INDENTURE...............................................................58 SECTION 11.15. TRUST OBLIGATION.....................................................................59 SECTION 11.16. NO PETITION..........................................................................59 SECTION 11.17. INSPECTION...........................................................................59 SECTION 11.18. CONFLICT WITH TRUST INDENTURE ACT....................................................59 SECTION 11.19. DISCLAIMER AND SUBORDINATION.........................................................60

iv
EXHIBITS Page ---- Exhibit A - Reserved A-1 Exhibit B - Form of Class A-1 Note B-1 Exhibit C - Form of Class A-2 Note C-1 Exhibit D - Form of Class B Note D-1 Exhibit E - Form of Assignment E-1 Exhibit F - Form of Note Depository Agreement F-1
v INDENTURE Indenture, dated as of [_____] (this "Indenture"), between Harley-Davidson Motorcycle Trust [_____], a Delaware statutory trust (the "Issuer") and [_____], in its capacity as indenture trustee (the "Indenture Trustee") and not in its individual capacity. Each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of the Issuer's [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-1 (the "Class A-1 Notes"), [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-2 (the "Class A-2 Notes") and [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class B (the "Class B Notes") and, together with the Class A-1 Notes and the Class B Notes, the "Notes"): GRANTING CLAUSE The Issuer hereby grants, transfers, assigns and otherwise conveys to the Indenture Trustee on the Closing Date, on behalf of and for the benefit of the Holders of the Notes, without recourse, all of the Issuer's right, title and interest (exclusive of the amount, if any, allocable to any rebatable insurance premium financed by any Contract) in, to and under: (i) the Initial Contracts and Subsequent Contracts secured by the Motorcycles (which Contracts shall be listed in the List of Contracts and Subsequent List of Contracts); (ii) certain monies due under the Initial Contracts and Subsequent Contracts after the Initial Cutoff Date and Subsequent Cutoff Date, respectively, including, without limitation, all payments of principal and interest with respect to any Motorcycles to which a Contract relates received after the Initial Cutoff Date or Subsequent Cutoff Date and all other proceeds received on or in respect of such Contracts (other than payments of principal and interest due on or prior to the Initial Cutoff Date or Subsequent Cutoff Date); (iii) security interests in the Motorcycles; (iv) amounts on deposit in the Collection Account, the Note Distribution Account, the Reserve Fund, the Pre-Funding Account and the Interest Reserve Account, including all Eligible Investments therein and all income from the investment of funds therein and all proceeds therefrom; (v) proceeds from claims under certain insurance policies, debt insurance policies or debt cancellation agreements in respect of individual Motorcycles or obligors under the Contracts; (vi) its rights under the Sale and Servicing Agreement; (vii) the protective security interest in certain of the above-described property granted by the Trust Depositor in favor of the Issuer; (viii) all present and future claims, demands, causes of and choses in action in respect of any or all of the foregoing; (ix) all rights to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Contracts and (x) all payments on or under and all proceeds of every kind and nature whatsoever in respect of any or all of the foregoing, including all proceeds of the conversion, voluntary or involuntary, into cash of other liquid property, all cash proceeds, accounts, accounts receivable, notes, drafts, acceptances, chattel paper, checks, deposit accounts, insurance proceeds, condemnation awards, rights to payment of any and every kind and other forms of obligations and receivables, instruments and other property which at any time constitute all or part of or are included in the proceeds of any of the foregoing (as each such defined term is defined in Section 1.01) (collectively, the "Collateral"). The foregoing Grant is made in trust to secure the payment of principal of and interest on, and any other amounts owing in respect of, the Notes, equally and ratably without prejudice, priority or distinction, except for the subordination of the Class B Notes provided herein and all other sums owing by the Issuer hereunder or under any other Transaction Document, and to secure compliance with the provisions of this Indenture, all as provided in this Indenture. The Indenture Trustee, as Indenture Trustee on behalf of the Holders of the Notes, acknowledges such Grant, accepts the trust under this Indenture in accordance with the provisions of this Indenture and agrees to perform its duties required in this Indenture in accordance with its terms and the terms of the other Transaction Documents to which it is a party. ARTICLE ONE DEFINITIONS AND INCORPORATION BY REFERENCE SECTION 1.01. DEFINITIONS. (a) Except as otherwise specified herein or as the context may otherwise require, the following terms have the respective meanings set forth below for all purposes of this Indenture. "ACT" shall have the meaning specified in Section 11.03(a). "ADMINISTRATION AGREEMENT" means the Administration Agreement, dated as of the date hereof, among the Administrator, the Issuer, the Trust Depositor and the Indenture Trustee. "ADMINISTRATOR" means Harley-Davidson Credit Corp. or any successor Administrator under the Administration Agreement. "AFFILIATE" means, with respect to any specified Person, any other Person controlling or controlled by or under common control with such specified Person. For the purposes of this definition, "CONTROL" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "CONTROLLING" and "CONTROLLED" have meanings correlative to the foregoing. "AUTHORIZED OFFICER" means, with respect to the Issuer, any officer of the Owner Trustee who is authorized to act for the Owner Trustee in matters relating to the Issuer and who is identified on the list of Authorized Officers delivered by the Owner Trustee to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter) and, so long as the Administration Agreement is in effect, any Vice President or more senior officer of the Administrator who is authorized to act for the Administrator in matters relating to the Issuer and to be acted upon by the Administrator pursuant to the Administration Agreement and who is identified on the list of Authorized 2 Officers delivered by the Administrator to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter). "BOOK ENTRY NOTES" means a beneficial interest in the Notes, ownership and transfers of which shall be made through book entries by a Clearing Agency as described in Section 2.09. "BUSINESS DAY" means any day other than a Saturday, Sunday or other day on which banking institutions in the city of Chicago, Illinois, Wilmington, Delaware or New York, New York are authorized or obligated by law, executive order or governmental decree to be closed. "CERTIFICATE OF TRUST" means the Certificate of Trust of the Issuer substantially in the form of EXHIBIT A to the Trust Agreement. "CLASS" means all Notes whose form is identical except for variation in denomination, principal amount or owner. "CLASS A-1 FINAL DISTRIBUTION DATE" has the meaning set forth in the Sale and Servicing Agreement. "CLASS A-1 RATE" has the meaning set forth in the Sale and Servicing Agreement. "CLASS A-1 NOTES" means the Class A-1 Notes, substantially in the form of EXHIBIT B. "CLASS A-2 FINAL DISTRIBUTION DATE" has the meaning set forth in the Sale and Servicing Agreement. "CLASS A-2 RATE" has the meaning set forth in the Sale and Servicing Agreement. "CLASS A-2 NOTES" means the Class A-2 Notes, substantially in the form of EXHIBIT C. "CLASS B FINAL DISTRIBUTION DATE" has the meaning set forth in the Sale and Servicing Agreement. "CLASS B RATE" has the meaning set forth in the Sale and Servicing Agreement. "CLASS B NOTES" means the Class B Notes, substantially in the form of EXHIBIT D. "CLEARING AGENCY" means an organization registered as a "clearing agency" pursuant to Section 17A of the Exchange Act. "CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other financial institution or other Person for whom from time to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the Clearing Agency. "CLOSING DATE" has the meaning set forth in the Sale and Servicing Agreement. 3 "CODE" means the Internal Revenue Code of 1986, as amended. "COLLATERAL" means the Collateral Granted to the Indenture Trustee under this Indenture, including all proceeds thereof. "COMMISSION" means the Securities and Exchange Commission. "CORPORATE TRUST OFFICE" means the principal office of the Indenture Trustee at which at any particular time its corporate trusts business shall be administered which office at date of the execution of this Agreement is located at [_____], Attention: [_____]; or at such other address as the Indenture Trustee may designate from time to time by notice to the Noteholders and the Issuer, or the principal corporate trust office of any successor Indenture Trustee (the address of which the successor Indenture Trustee will notify the Noteholders and the Issuer). "DEFAULT" means any occurrence that is, or with notice or the lapse of time or both would become, an Event of Default. "DEFINITIVE NOTES" shall have the meaning specified in Section 2.09. "DISTRIBUTION DATE" has the meaning set forth in the Sale and Servicing Agreement. "DTC" means The Depository Trust Company, and its successors and assigns. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. "EVENT OF DEFAULT" shall have the meaning specified in Section 5.01. "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended. "EXECUTIVE OFFICER" means, with respect to any corporation, the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, President, Executive Vice President, any Vice President, the Secretary or the Treasurer of such corporation; and with respect to any partnership, any general partner thereof. "GRANT" means mortgage, pledge, bargain, sell, warrant, alienate, remise, release, convey, assign, transfer, create and grant a lien upon and a security interest in and right of set-off against, deposit, set over and confirm pursuant to this Indenture. A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and options (but none of the obligations) of the granting party thereunder, including the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of the Collateral and all other moneys payable thereunder, to give and receive notices and other communications, to make waivers or other agreements, to exercise all rights and options, to bring Proceedings in the name of the granting party or otherwise and generally to do and receive anything that the granting party is or may be entitled to do or receive thereunder or with respect thereto. 4 "HARLEY-DAVIDSON CREDIT" means Harley-Davidson Credit Corp., and its successors and assigns. "HOLDER" or "NOTEHOLDER" or "NOTE OWNER" means, with respect to a Book-Entry Note, the Person who is the owner of such Book-Entry Note, as reflected on the books of the Clearing Agency, or on the books of a Person maintaining an account with such Clearing Agency (directly as a Clearing Agency participant or as an indirect participant, in each case in accordance with the rules of such Clearing Agency) and with respect to a Definitive Note the Person in whose name a Note is registered on the Note Register. "INDEBTEDNESS" means, with respect to any Person at any time, (i) indebtedness or liability of such Person for borrowed money whether or not evidenced by bonds, debentures, notes or other instruments, or for the deferred purchase price of property or services (including trade obligations); (ii) obligations of such Person as lessee under leases which should have been or should be, in accordance with generally accepted accounting principles, recorded as capital leases; (iii) current liabilities of such Person in respect of unfunded vested benefits under plans covered by Title IV of ERISA; (iv) obligations issued for or liabilities incurred on the account of such Person; (v) obligations or liabilities of such Person arising under acceptance facilities; (vi) obligations of such Person under any guaranties, endorsements (other than for collection or deposit in the ordinary course of business) and other contingent obligations to purchase, to provide funds for payment, to supply funds to invest in any Person or otherwise to assure a creditor against loss; (vii) obligations of such Person secured by any lien on property or assets of such Person, whether or not the obligations have been assumed by such Person; or (viii) obligations of such Person under any interest rate or currency exchange agreement. "INDENTURE" means this Indenture, as amended or supplemented from time to time. "INDENTURE SECURITIES" means the Notes. "INDENTURE SECURITY HOLDER" means a Noteholder. "INDENTURE TRUSTEE" means [_____], as Indenture Trustee under this Indenture, or any successor Indenture Trustee under this Indenture. "INDEPENDENT" means, when used with respect to any specified Person, that the Person (i) is in fact independent of the Issuer, any other obligor upon the Notes, the Trust Depositor, the Seller and any of their respective Affiliates, (ii) does not have any direct financial interest or any material indirect financial interest in the Issuer, any such other obligor, the Seller or any of their respective Affiliates, and (iii) is not connected with the Issuer, any such other obligor, the Seller or any Affiliate of any of the foregoing Persons as an officer, employee, promoter, underwriter, trustee, partner, director or person performing similar functions. "INDEPENDENT CERTIFICATE" means a certificate or opinion to be delivered to the Indenture Trustee under the circumstances described in, and otherwise complying with, the applicable requirements of Section 11.01, made by an Independent appraiser or other expert appointed by an Issuer Order and approved by the Indenture Trustee in the exercise of 5 reasonable care, and such opinion or certificate shall state that the signer has read the definition of "INDEPENDENT" in this Indenture and that the signer is Independent within the meaning thereof. "INTEREST PERIOD" means, with respect to any Distribution Date and any Class of Notes, the period from and including the fifteenth day of the month of the Distribution Date immediately preceding such Distribution Date (or, in the case of the first Distribution Date, from and including the Closing Date) to but excluding the fifteenth day of the month of such Distribution Date. "INTEREST RATE" means the Class A-1 Rate, the Class A-2 Rate and the Class B Rate, as applicable. "ISSUER" means Harley-Davidson Motorcycle Trust [_____] until a successor replaces it and, thereafter, means the successor and, for purposes of any provision contained herein and required by the TIA, each other obligor on the Notes. "ISSUER ORDER" and "ISSUER REQUEST" means a written order or request signed in the name of the Issuer by any one of its Authorized Officers and delivered to the Indenture Trustee. "NOTE" means, as the context requires, a Class A-1 Note, a Class A-2 Note or a Class B Note. "NOTE DEPOSITORY AGREEMENT" means the agreement dated as of the Closing Date, among the Issuer, the Administrator, the Indenture Trustee and DTC, as the initial Clearing Agency, relating to the Notes, substantially in the form of EXHIBIT F hereto. "NOTE REGISTER" and "NOTE REGISTRAR" have the respective meanings specified in Section 2.04. "OFFICER'S CERTIFICATE" means a certificate signed by any Authorized Officer of the Issuer, under the circumstances described in, and otherwise complying with, the applicable requirements of Section 11.01, and delivered to, the Indenture Trustee. Unless otherwise specified, any reference in this Indenture to an Officer's Certificate shall be to an Officer's Certificate of any Authorized Officer of the Issuer. "OPINION OF COUNSEL" means one or more written opinions of counsel who may, except as otherwise expressly provided in this Indenture, be employees of or counsel to the Issuer and who shall be satisfactory to the Indenture Trustee and which shall comply with any applicable requirements of Section 11.01, and shall be in form and substance satisfactory to the Indenture Trustee. "OUTSTANDING" means, as of the date of determination, all Notes theretofore authenticated and delivered under this Indenture except: 6 (i) Notes theretofore cancelled by the Note Registrar or delivered to the Note Registrar for cancellation; (ii) Notes or portions thereof the payment for which money in the necessary amount has been theretofore deposited with the Indenture Trustee or any Paying Agent in trust for the Holders of such Notes (PROVIDED, HOWEVER, that if such Notes are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision for such notice has been made, satisfactory to the Indenture Trustee, has been made); and (iii) Notes in exchange for or in lieu of other Notes which have been authenticated and delivered pursuant to this Indenture unless proof satisfactory to the Indenture Trustee is presented that any such Notes are held by a protected purchaser, within the meaning of Section 8-303 of the UCC; PROVIDED, HOWEVER, that in determining whether the Holders of the requisite Outstanding Amount have given any request, demand, authorization, direction, notice, consent or waiver hereunder or under any other Transaction Document, Notes owned by the Issuer, any other obligor upon the Notes, the Trust Depositor, Harley-Davidson Credit or any of their respective Affiliates shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Indenture Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Notes that the Indenture Trustee knows to be so owned shall be so disregarded. Notes so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Indenture Trustee the pledgee's right so to act with respect to such Notes and that the pledgee is not the Issuer, any other obligor upon the Notes, the Trust Depositor, Harley-Davidson Credit or any of their respective Affiliates. "OUTSTANDING AMOUNT" means the aggregate principal amount of all Notes of one Class or of all Classes, as the case may be, Outstanding at the date of determination. "OWNER TRUSTEE" means [_____], not in its individual capacity but solely as Owner Trustee under the Trust Agreement, or any successor trustee under the Trust Agreement. "PAYING AGENT" means the Indenture Trustee or any other Person that meets the eligibility standards for the Indenture Trustee specified in Section 6.11 and is authorized by the Issuer to make the distributions from the Note Distribution Account, including payment of principal of or interest on the Notes on behalf of the Issuer. "PERSON" means any individual, corporation, estate, partnership, limited liability company, joint venture, association, joint stock company, trust (including any beneficiary thereof), unincorporated organization or government or any agency or political subdivision thereof. "PLAN" means an employee benefit plan, as defined in Section 3(3) of ERISA, that is subject to Title I of ERISA or a plan, as defined in Section 4975(e)(1) of the Code. 7 "PREDECESSOR NOTE" means, with respect to any particular Note, every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note; and for the purpose of this definition, any Note authenticated and delivered under Section 2.05 in lieu of a mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same debt as the mutilated, lost, destroyed or stolen Note. "PROCEEDING" means any suit in equity, action at law or other judicial or administrative proceeding. "RATING AGENCY" means each of Moody's and Standard & Poor's. "RATING AGENCY CONDITION" means, with respect to any action, that each Rating Agency shall have been given ten days (or such shorter period as is acceptable to each Rating Agency) prior notice thereof and that each Rating Agency shall have notified the Trust Depositor, the Servicer and the Issuer in writing that such action will not result in a qualification, reduction or withdrawal of its then-current rating of any Class of Notes. "RATING EVENT" means the qualification, reduction or withdrawal by either Rating Agency of its then-current rating of any Class of Notes. "RECORD DATE" means, with respect to a Redemption Date, the close of business on the last Business Day of the immediately preceding month and, with respect to a Distribution Date, the close of business on the day immediately preceding such date. "REDEMPTION DATE" means (a) in the case of a redemption of the Notes pursuant to Section 10.01(a) or a payment to Noteholders pursuant to Section 10.01(b), the Distribution Date specified by the Servicer or the Issuer pursuant to Section 10.01(a) or 10.01(b), as the case may be and (b) in the case of a redemption of Notes pursuant to Section 10.01(c), the Distribution Date specified in Section 7.07 of the Sale and Servicing Agreement on which the Indenture Trustee shall withdraw any amount remaining in the Pre-Funding Account and deposit the applicable amount in the Note Distribution Account. "REDEMPTION DATE AMOUNT" means (i) in the case of a redemption of the Notes pursuant to Section 10.01(a), an amount equal to the unpaid principal amount of the Notes redeemed plus accrued and unpaid interest thereon at the weighted average of the Interest Rate for each Class of Notes being so redeemed to but excluding the Redemption Date, or (ii) in the case of a payment made to Noteholders pursuant to Section 10.01(b), the amount on deposit in the Note Distribution Account, but not in excess of the amount specified in clause (i) above. "REGISTERED HOLDER" means the Person in whose name a Note is registered on the Note Register on the applicable Record Date. "RESPONSIBLE OFFICER" means, with respect to the Indenture Trustee, any officer within the Corporate Trust Office (or any successor group of the Indenture Trustee), including any Vice President, assistant secretary or other officer or assistant officer of the Indenture Trustee customarily performing functions similar to those performed by the people who at such time shall be officers, respectively, or to whom any corporate trust 8 matter is referred at the Corporate Trust Office of the Indenture Trustee because of his knowledge of and familiarity with the particular subject. "SALE AND SERVICING AGREEMENT" means the Sale and Servicing Agreement, dated as of the date hereof, among the Issuer, the Trust Depositor, the Indenture Trustee and the Servicer. "SELLER" means Harley-Davidson Credit, in its capacity as Seller under the Transfer and Sale Agreement, and any successors and assigns. "SERVICER" means Harley-Davidson Credit, in its capacity as Servicer under the Sale and Servicing Agreement, and any Successor Servicer thereunder. "SIMILAR LAW" means any foreign, federal, state or local law with provisions substantially similar to Title I of ERISA or Section 4975 of the Code. "STATE" means any one of the 50 states of the United States or any of its territories, or the District of Columbia. "TERMINATION DATE" means the date on which the Indenture Trustee shall have received payment and performance of all amounts and obligations which the Issuer may owe to or on behalf of the Indenture Trustee for the benefit of the Noteholders under this Indenture or the Notes. "TRUST AGREEMENT" means the Trust Agreement, dated as of [_____], between the Trust Depositor and the Owner Trustee. "TRUST DEPOSITOR" shall mean Harley-Davidson Customer Funding Corp., in its capacity as trust depositor under the Sale and Servicing Agreement. "TRUST INDENTURE ACT" or "TIA" means the Trust Indenture Act of 1939, as amended. "UCC" means the Uniform Commercial Code as in effect on the date hereof and from time to time in the State of Illinois, PROVIDED that if by reason of mandatory provisions of law, the perfection or the effect of perfection or non-perfection or priority of the security interests in any collateral or the availability of any remedy hereunder is governed by the Uniform Commercial Code as in effect on or after the date hereof in any other jurisdiction, "UCC" means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or effect of perfection or non-perfection or priority or availability of such remedy. "UNITED STATES" means the United States of America. (b) Except as otherwise specified herein or as the context may otherwise require, capitalized terms used herein that are not otherwise defined shall have the meanings ascribed thereto in the Sale and Servicing Agreement. 9 SECTION 1.02. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings: "COMMISSION" means the Securities and Exchange Commission. "INDENTURE SECURITIES" means the Notes. "INDENTURE SECURITY HOLDER" means a Noteholder. "INDENTURE TO BE QUALIFIED" means this Indenture. "INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Indenture Trustee. "OBLIGOR" on the indenture securities means the Issuer and any other obligor on the indenture securities. All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by Commission rule have the meaning assigned to them by such definitions. SECTION 1.03. RULES OF CONSTRUCTION. Unless the context otherwise requires: (i) a term has the meaning assigned to it; (ii) an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles as in effect from time to time; (iii) "OR" is not exclusive; (iv) "INCLUDING" means including without limitation; (v) words in the singular include the plural and words in the plural include the singular; (vi) any agreement, instrument or statute defined or referred to herein or in any instrument or certificate delivered in connection herewith means such agreement, instrument or statute as from time to time amended, modified or supplemented and includes (in the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein; references to a Person are also to its permitted successors and assigns; and (vii) the words "HEREOF," "HEREIN" and "HEREUNDER" and words of similar import when used in this Indenture shall refer to this Indenture as a whole and not to any particular provision of this Indenture; Section and subsection references contained in this Indenture are references to Sections and subsections in or to this Indenture unless otherwise specified. 10 ARTICLE TWO THE NOTES SECTION 2.01. FORM. The Class A-1 Notes, the Class A-2 Notes and the Class B Notes, in each case together with the Indenture Trustee's certificate of authentication, shall be in substantially the forms set forth as Exhibits to this Indenture with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may, consistently herewith, be determined by the officers executing such Notes, as evidenced by their execution of the Notes. Any portion of the text of any Note may be set forth on the reverse thereof, with an appropriate reference thereto on the face of the Note. Each Note shall be dated the date of its authentication. The terms of the Notes set forth in Exhibits hereto are part of the terms of this Indenture. SECTION 2.02. EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be executed on behalf of the Issuer by any of its Authorized Officers. The signature of any such Authorized Officer on the Notes may be manual or facsimile. Notes bearing the manual or facsimile signature of individuals who were at any time Authorized Officers of the Issuer shall bind the Issuer, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Notes or did not hold such offices at the date of such Notes. The Indenture Trustee shall, upon receipt of an Issuer Order, authenticate and deliver for original issue (i) Class A-1 Notes in an aggregate principal amount of $[_________], (ii) Class A-2 Notes in an aggregate principal amount of $[_________] and (iii) Class B Notes in an aggregate principal amount of $[_________]. The aggregate principal amount of such Classes of Notes Outstanding at any time may not exceed such respective amounts, except as otherwise provided in Section 2.05. Each Note shall be dated the date of its authentication. The Notes shall be issuable as registered Notes in the minimum denomination of $1,000 and in integral multiples of $1,000 in excess thereof. No Note shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose, unless there appears on such Note a certificate of authentication substantially in the form provided for herein by the Indenture Trustee by the manual signature of one of its authorized signatories, and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered hereunder. SECTION 2.03. TEMPORARY NOTES. Pending the preparation of Book-Entry Notes or Definitive Notes, the Issuer may execute, and upon receipt of an Issuer Order the Indenture Trustee shall authenticate and deliver, temporary Notes that are printed, lithographed, typewritten, mimeographed or otherwise produced, of the tenor of the definitive Notes in 11 lieu of which they are issued and with such variations not inconsistent with the terms of this Indenture as the officers executing such Notes may determine, as evidenced by their execution of such Notes. If temporary Notes are issued, the Issuer will cause Book-Entry Notes or Definitive Notes to be prepared without unreasonable delay. After the preparation of Book-Entry Notes or Definitive Notes, the temporary Notes shall be exchangeable for Book-Entry Notes or Definitive Notes upon surrender of the temporary Notes at the office or agency of the Issuer to be maintained as provided in Section 3.02, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Notes, the Issuer shall execute and the Indenture Trustee shall authenticate and deliver in exchange therefor a like tenor and principal amount of definitive Notes of authorized denominations. Until so exchanged, the temporary Notes shall in all respects be entitled to the same benefits under this Indenture as Book-Entry Notes or Definitive Notes. SECTION 2.04. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE. The Issuer shall cause to be kept a register (the "Note Register") in which, subject to such reasonable regulations as it may prescribe, the Note Registrar shall provide for the registration of Notes and the registration of transfers of Notes. The Indenture Trustee shall be "Note Registrar" for the purpose of registering Notes and transfers of Notes as herein provided. Upon any resignation of any Note Registrar, the Issuer shall promptly appoint a successor or, if it elects not to make such an appointment, assume the duties of Note Registrar. If a Person other than the Indenture Trustee is appointed by the Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt written notice of the appointment of such Note Registrar and of the location, and any change in the location, of the Note Register, and the Indenture Trustee shall have the right to inspect the Note Register at all reasonable times and to obtain copies thereof, and the Indenture Trustee shall have the right to rely upon a certificate executed on behalf of the Note Registrar by an Executive Officer thereof as to the names and addresses of the Holders of the Notes and the principal amounts and the amounts and number of such Notes. Upon surrender for registration of transfer of any Note at the office or agency of the Issuer to be maintained as provided in Section 3.02, the Issuer shall execute, and the Indenture Trustee shall authenticate and the Noteholder shall obtain from the Indenture Trustee, in the name of the designated transferee or transferees, one or more new Notes of the same Class in any authorized denominations, of a like aggregate principal amount. At the option of the Holder, Notes may be exchanged for other Notes of the same Class in any authorized denominations, of a like aggregate principal amount, upon surrender of the Notes to be exchanged at such office or agency. Whenever any Notes are so surrendered for exchange, the Issuer shall execute, and the Indenture Trustee shall authenticate and the Noteholder shall obtain from the Indenture Trustee, the Notes which the Noteholder making the exchange is entitled to receive. All Notes issued upon any registration of transfer or exchange of Notes shall be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits 12 under this Indenture, as the Notes surrendered upon such registration of transfer or exchange. Every Note presented or surrendered for registration of transfer or exchange shall be duly endorsed by, or be accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee duly executed by, the Holder thereof or such Holder's attorney duly authorized in writing, with such signature guaranteed by a commercial bank or trust company located, or having a correspondent located in the city in which the Corporate Trust Office is located, or by a member firm of a national securities exchange, and such other documents as the Indenture Trustee may require. No service charge shall be made to a Holder for any registration of transfer or exchange of Notes, but the Issuer or the Indenture Trustee may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Notes, other than exchanges pursuant to Section 2.03 not involving any transfer. Each Person that acquires a Note shall be required to represent, or in the case of a Note in book-entry form, will be deemed to represent by its acceptance of the Note, that (i) it is not, and is not acquiring the Note on behalf of or with "plan assets" (as determined under Department of Labor Regulation Section 2510.3-101 or otherwise) of a Plan, or any employee benefit plan subject to Similar Law, or (ii) its acquisition and holding of the Note do not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code, or any Similar Law. Any transfer with respect to which the representation in clause (i) or (ii) above is not true shall be void AB INITIO. The Notes may not be purchased with the assets of a Plan if the Issuer, the Indenture Trustee, the Owner Trustee, the Servicer or the Underwriters or any of their affiliates has investment or administrative discretion with respect to those Plan assets; has authority or responsibility to give, or regularly gives, investment advice with respect to those Plan assets for a fee and pursuant to an agreement or understanding that the advice will serve as a primary basis for investment decisions with respect to those Plan assets and will be based on the particular investment needs for the Plan; or is an employer maintaining or contributing to the Plan. The preceding provisions of this Section notwithstanding, the Issuer shall not be required to make and the Note Registrar need not register transfers or exchanges of Notes selected for redemption or of any Note for a period of 15 days preceding the due date for any payment with respect to the Note. (i) the Note Registrar and the Indenture Trustee will be entitled to deal with the Clearing Agency for all purposes of this Indenture (including the payment of principal of and interest on the Notes and the giving of instructions or directions hereunder) as the sole holder of the Notes, and shall have no obligation to the Noteholders; (ii) the rights of Noteholders will be exercised only through the Clearing Agency and will be limited to those established by law and agreements between such Noteholders 13 and the Clearing Agency and/or the Clearing Agency Participants pursuant to the Depository Agreement; (iii) whenever this Indenture requires or permits actions to be taken based upon instructions or directions of Holders of Notes evidencing a specified percentage of the Outstanding Amount of the Notes, the Clearing Agency will be deemed to represent such percentage only to the extent that it has received instructions to such effect from Noteholders and/or Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in the Notes and has delivered such instructions to the Indenture Trustee; and (iv) without the consent of the Issuer and the Indenture Trustee, no such Note may be transferred by the Depository except to a successor Depository that agrees to hold such Note for the account of the Owners or except upon the election of the Owner thereof or a subsequent transferee to hold such Note in physical form. Neither the Indenture Trustee nor the Registrar shall have any responsibility to monitor or restrict the transfer of beneficial ownership in any Note an interest in which is transferable through the facilities of the Depository. SECTION 2.05. MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (i) any mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, and (ii) there is delivered to the Indenture Trustee such security or indemnity as may be required by them to hold the Issuer and the Indenture Trustee harmless, then, in the absence of notice to the Issuer, the Note Registrar or the Indenture Trustee that such Note has been acquired by a protected purchaser, within the meaning of Section 8-303 of the UCC, the Issuer shall execute and upon its request the Indenture Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note of the same Class and denomination; provided, however, that if any such destroyed, lost or stolen Note, but not a mutilated Note, shall have become or within seven days shall be due and payable, or shall have been called for redemption, instead of issuing a replacement Note, the Issuer may pay such destroyed, lost or stolen Note when so due or payable or upon the Redemption Date without surrender thereof. If, after the delivery of such replacement Note or payment of a destroyed, lost or stolen Note pursuant to the proviso to the preceding sentence, a protected purchaser, within the meaning of Section 8-303 of the UCC, of the original Note in lieu of which such replacement Note was issued presents for payment such original Note, the Issuer, and the Indenture Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such replacement Note from such Person to whom such replacement Note was delivered or any assignee of such Person, except a protected purchaser, within the meaning of Section 8-303 of the UCC, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by the Issuer or the Indenture Trustee in connection therewith. Upon the issuance of any replacement Note under this Section, the Issuer or the Indenture Trustee may require the payment by the Holder of such Note of a sum sufficient to 14 cover any tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the fees and expenses of the Indenture Trustee or the Note Registrar) connected therewith. Every replacement Note issued pursuant to this Section in replacement of any mutilated, destroyed, lost of stolen Note shall constitute an original additional contractual obligation of the Issuer, whether or not the mutilated, destroyed, lost or stolen Note shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes. SECTION 2.06. PERSONS DEEMED OWNER. Prior to due presentment for registration of transfer of any Note, the Issuer, the Indenture Trustee, and any of their respective agents may treat the Person in whose name any Note is registered (as of the day of determination) as the owner of such Note for the purpose of receiving payments of principal of and interest, if any, on such Note and for all other purposes whatsoever, whether or not such Note be overdue, and none of the Issuer, the Indenture Trustee nor any of their respective agents shall be affected by notice to the contrary. SECTION 2.07. PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED INTEREST. (a) Each Class of Notes shall accrue interest at the related Interest Rate, and such interest shall be payable on each Distribution Date as specified therein, subject to Section 3.01. Any installment of interest or principal, if any, payable on any Note which is punctually paid or duly provided for by the Issuer on the applicable Distribution Date shall be paid to the Person in whose name such Note (or one or more Predecessor Notes) is registered on the Record Date, by wire transfer in immediately available funds to the account designated by such nominee and except for the final installment of principal payable with respect to such Note on a Distribution Date or on the related Final Distribution Date, as the case may be (and except for the Redemption Price for any Note called for redemption pursuant to Section 10.01(a)), which shall be payable as provided below. The funds represented by any such checks returned undelivered shall be held in accordance with Section 3.03. (b) The principal of each Note shall be payable on each Distribution Date to the extent provided in the form of the related Note set forth as an Exhibit hereto. Notwithstanding the foregoing, the entire unpaid principal amount of the Notes shall be due and payable, if not previously paid, on the date on which the maturity of the Notes has been accelerated in the manner provided in Section 5.02. All principal payments on each Class of Notes shall be made pro rata to the Noteholders of such Class entitled thereto. The Indenture Trustee shall notify the Person in whose name a Note is registered at the close of business on the Record Date preceding the Distribution Date on which the Issuer expects that the final installment of principal of and interest on such Note will be paid. Such notice shall be mailed within five Business Days of receipt of notice of termination of the Trust 15 pursuant to Section 9.01(c) of the Trust Agreement and shall specify that such final installment will be payable only upon presentation and surrender of such Note and shall specify the place where such Note may be presented and surrendered for payment of such installment. Notices in connection with redemptions of Notes shall be mailed to Noteholders as provided in Section 10.02. (c) If the Issuer defaults in a payment of interest on the Notes, the Issuer shall pay defaulted interest (plus interest on such defaulted interest to the extent lawful) at the applicable Interest Rate in any lawful manner. The Issuer may pay such defaulted interest to the Persons who are Noteholders on a subsequent special record date, which date shall be at least five Business Days prior to the related payment date. The Issuer shall fix or cause to be fixed any such special record date and payment date and, at least 15 days before any such special record date, the Issuer shall mail to the Indenture Trustee and each Noteholder a notice that states the special record date, the payment date and the amount of defaulted interest to be paid. SECTION 2.08. CANCELLATION. All Notes surrendered for payment, registration of transfer, exchange or redemption shall, if surrendered to any Person other than the Indenture Trustee, be delivered to the Indenture Trustee and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any time deliver to the Indenture Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Issuer may have acquired in any manner whatsoever, and all Notes so delivered shall be promptly cancelled by the Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Notes may be held or disposed of by the Indenture Trustee in accordance with its standard retention or disposal policy as in effect at the time unless the Issuer shall direct by an Issuer Order that they be destroyed or returned to it; provided that such Issuer Order is timely and the Notes have not been previously disposed of by the Indenture Trustee. SECTION 2.09. BOOK-ENTRY NOTES. The Notes, upon original issuance, will be issued in the form of a typewritten Note or Notes representing the Book-Entry Notes, to be delivered to DTC, the initial Depository, by, or on behalf of, the Issuer. Such Notes shall initially be registered on the Note Register in the name of Cede & Co., the nominee of the initial Clearing Agency, and no Noteholder will receive a Definitive Note representing such Noteholder's interest in such Note, except as provided in Section 2.11. Unless and until definitive, fully registered Notes (the "Definitive Notes") have been issued to Noteholders pursuant to Section 2.11: (i) the provisions of this Section shall be in full force and effect; (ii) the Note Registrar and the Indenture Trustee shall be entitled to deal with the Clearing Agency for all purposes of this Indenture (including the payment of principal of and interest on the Notes and the giving of instructions or directions hereunder) as the sole holder of the Notes, and shall have no obligation to the Noteholders; 16 (iii) to the extent that the provisions of this Section conflict with any other provisions of this Indenture, the provisions of this Section shall control; (iv) the rights of Noteholders shall be exercised only through the Clearing Agency and shall be limited to those established by law and agreements between such Noteholders and the Clearing Agency and/or the Clearing Agency Participants. Pursuant to the Note Depository Agreement, unless and until Definitive Notes are issued pursuant to Section 2.11, the Clearing Agency will make book-entry transfers among the Clearing Agency Participants and receive and transmit payments of principal of and interest on the Notes to such Clearing Agency Participants; and (v) whenever this Indenture requires or permits actions to be taken based upon instructions or directions of Noteholders evidencing a specified percentage of the Outstanding Amount, the Clearing Agency shall be deemed to represent such percentage only to the extent that it has received instructions to such effect from Noteholders and/or Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in the Notes and has delivered such instructions to the Indenture Trustee. SECTION 2.10. NOTICES TO CLEARING AGENCY. Whenever a notice or other communication to the Noteholders is required under this Indenture, unless and until Definitive Notes shall have been issued to Noteholders pursuant to Section 2.11, the Indenture Trustee shall give all such notices and communications specified herein to be given to Noteholders of the Notes to the Clearing Agency, and shall have no obligation to the Noteholders. SECTION 2.11. DEFINITIVE NOTES. If (i)(A) the Administrator advises the Indenture Trustee in writing that the Clearing Agency is no longer willing or able to properly discharge its responsibilities as described in the Note Depository Agreement, and (B) Indenture Trustee or the Administrator is unable to locate a qualified successor, (ii) the Administrator or the Owner Trustee, as applicable, notifies the Clearing Agency of its intent to terminate the book-entry system through the Clearing Agency and requests a withdrawal of the Book-Entry Notes held by the Clearing Agency, and after receipt by the Clearing Agency Participants of an important notice issued by the Clearing Agency notifying the Clearing Agency Participants of such withdrawal request, the Clearing Agency Participants holding beneficial interests in the Book-Entry Notes agree to initiate such termination, or (iii) after the occurrence of an Event of Default, the Modified Required Holders advise the Indenture Trustee and the Clearing Agency through the Clearing Agency Participants in writing that the continuation of a book-entry system through the Clearing Agency is no longer in the best interests of the related Noteholders, then the Indenture Trustee shall notify all Noteholders of the related Class or Classes of Notes, through the Clearing Agency, of the occurrence of any such event and of the availability of Definitive Notes of the related Class of Notes to Noteholders requesting the same. Upon surrender to the Indenture Trustee of the Note or Notes representing the Book-Entry Notes by the Clearing Agency, accompanied by registration instructions, the Issuer shall execute and the Indenture Trustee shall authenticate the Definitive Notes in accordance with the instructions of the Clearing Agency. None of the Issuer, the Note Registrar or the Indenture Trustee shall be liable for any delay in 17 delivery of such instructions and may conclusively rely on, and shall be protected in relying on, such instructions. Upon the issuance of Definitive Notes of a Class, the Indenture Trustee shall recognize the Noteholders of the Definitive Notes as Noteholders hereunder. The Indenture Trustee shall not be liable if the Indenture Trustee or the Administrator is unable to locate a qualified successor Clearing Agency. The Definitive Notes shall be typewritten, printed, lithographed or engraved or produced by any combination of these methods (with or without steel engraved borders), all as determined by the officers executing such Notes, as evidenced by their execution of such Notes. SECTION 2.12. RELEASE OF COLLATERAL. Subject to Sections 4.04, 8.04 and 11.01 and the terms of the Transaction Documents, the Indenture Trustee shall release property from the lien of this Indenture only upon receipt of an Issuer Request accompanied by an Officer's Certificate. SECTION 2.13. TAX TREATMENT. The Issuer and the purchasers of the Notes intend, and will take all actions consistent with the intention, that the Notes be treated as indebtedness for all federal, state, local, and foreign income and franchise tax purposes and that, pursuant to Treasury Regulations Section 301.7701-3(b)(1)(ii) as in effect for periods after January 1, 1997, the Trust be disregarded as a separate entity from the Trust Depositor for federal income tax purposes. The Issuer, by entering into this Indenture, and each Noteholder, by its acceptance of its Note agree to treat the Notes for federal, state and local income, single business and franchise tax purposes as indebtedness of the Issuer. ARTICLE THREE COVENANTS SECTION 3.01. PAYMENT OF PRINCIPAL AND INTEREST. The Issuer will duly and punctually pay the principal of and interest, if any, on the Notes in accordance with the terms of the Notes and this Indenture. Without limiting the foregoing, subject to Section 8.02(c), the Issuer and the Indenture Trustee will cause to be deposited into the Note Distribution Account amounts allocated pursuant to Section 7.05 of the Sale and Servicing Agreement, and cause to be distributed all such amounts on a Distribution Date as deposited therein (i) for the benefit of the Class A-1 Notes, to the Class A-1 Noteholders, (ii) for the benefit of the Class A-2 Notes, to the Class A-2 Noteholders and (iii) for the benefit of the Class B Notes, to the Class B Noteholders, in each case as further specified herein. Amounts properly withheld under the Code by any Person from a payment to any Noteholder of interest and/or principal shall be considered as having been paid by the Issuer to such Noteholder for all purposes of this Indenture. SECTION 3.02. MAINTENANCE OF OFFICE OR AGENCY. The Issuer will maintain in Wilmington, Delaware, an office or agency where Notes may be surrendered for registration of transfer or exchange, and where notices and demands to or upon the Issuer in respect of the Notes and this Indenture may be served. The Issuer hereby initially appoints the Indenture Trustee to serve as its agent for the foregoing purposes. The Issuer will give 18 prompt written notice to the Indenture Trustee of the location, and of any change in the location, of any such office or agency. If at any time the Issuer shall fail to maintain any such office or agency or shall fail to furnish the Indenture Trustee with the address thereof, such surrenders, notices and demands may be made or served at the Corporate Trust Office, and the Issuer hereby appoints the Indenture Trustee as its agent to receive all such surrenders, notices and demands. SECTION 3.03. MONEY FOR PAYMENTS TO BE HELD IN TRUST. As provided in Section 8.02, all payments of amounts due and payable with respect to any Notes that are to be made from amounts withdrawn from the Collection Account and the Note Distribution Account pursuant to Section 8.02(b) shall be made on behalf of the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts so withdrawn from the Collection Account and the Note Distribution Account for payments of Notes shall be paid over to the Issuer except as provided in this Section. On or before the Business Day immediately preceding each Distribution Date and Redemption Date, the Issuer shall deposit or cause to be deposited in the Note Distribution Account an aggregate sum sufficient to pay the amounts then becoming due, such sum to be held in trust for the benefit of the Persons entitled thereto and (unless the Paying Agent is the Indenture Trustee) shall promptly notify the Indenture Trustee of its action or failure so to act. The Issuer will cause each Paying Agent other than the Indenture Trustee to execute and deliver to the Indenture Trustee an instrument in which such Paying Agent shall agree with the Indenture Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of this Section, that such Paying Agent will: (i) hold all sums held by it for the payment of amounts due with respect to the Notes in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay such sums to such Persons as herein provided; (ii) give the Indenture Trustee notice of any default by the Issuer (or any other obligor upon the Notes) in the making of any payment required to be made with respect to the Notes; (iii) at any time during the continuance of any such default, upon the written request of the Indenture Trustee, forthwith pay to the Indenture Trustee all sums so held in trust by such Paying Agent; (iv) immediately resign as a Paying Agent and forthwith pay to the Indenture Trustee all sums held by it in trust for the payment of Notes if at any time it ceases to meet the standards required to be met by a Paying Agent at the time of its appointment; and (v) comply with all requirements of the Code with respect to the withholding from any payments made by it on any Notes of any applicable withholding 19 taxes imposed thereon and with respect to any applicable reporting requirements in connection therewith. The Issuer may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, by Issuer Order direct any Paying Agent to pay to the Indenture Trustee all sums held in trust by such Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts as those upon which the sums were held by such Paying Agent; and upon such payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall be released from all further liability with respect to such money. Subject to applicable laws with respect to escheat of funds, any money held by the Indenture Trustee or any Paying Agent in trust for the payment of any amount due with respect to any Note and remaining unclaimed for two years after such amount has become due and payable shall be discharged from such trust and upon receipt of an Issuer Request shall be deposited by the Indenture Trustee in the Collection Account; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Issuer for payment thereof, and all liability of the Indenture Trustee or such Paying Agent with respect to such trust money shall thereupon cease; PROVIDED, HOWEVER, that if such money or any portion thereof had been previously deposited by the Issuer with the Indenture Trustee for the payment of principal or interest on the Notes; and PROVIDED, FURTHER, that the Indenture Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Issuer cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in The City of New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to or for the account of the Issuer. The Indenture Trustee may also adopt and employ, at the expense of the Issuer, any other reasonable means of notification of such repayment (including, but not limited to, mailing notice of such repayment to Holders whose Notes have been called but not have not been surrendered for redemption or whose right to or interest in moneys due and payable but not claimed is determinable from the records of the Indenture Trustee or of any Paying Agent, at the last address of record for each such Holder). SECTION 3.04. EXISTENCE. The Issuer will keep in full effect its existence, rights and franchises as a statutory trust under the laws of the State of Delaware (unless it becomes, or any successor Issuer hereunder is or becomes, organized under the laws of any other state or of the United States, in which case the Issuer will keep in full effect its existence, rights and franchises under the laws of such other jurisdiction) and will obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Indenture, the Notes, the Collateral and each other instrument or agreement included in the Collateral. SECTION 3.05. PROTECTION OF COLLATERAL. The Issuer intends the security interest Granted pursuant to this Indenture in favor of the Indenture Trustee on behalf of the Noteholders to be prior to all other liens in respect of the Collateral, and the Issuer shall take all actions necessary to obtain and maintain, for the benefit of the Indenture Trustee on 20 behalf of the Noteholders, a first lien on and a first priority, perfected security interest in the Collateral. The Issuer will from time to time execute and deliver all such supplements and amendments hereto and all such financing statements, continuation statements, instruments of further assurance and other instruments, all as prepared by the Servicer and delivered to the Issuer, and will take such other action necessary or advisable to: (i) Grant more effectively all or any portion of the Collateral; (ii) maintain or preserve the lien and security interest (and the priority thereof) created by this Indenture or carry out more effectively the purposes hereof; (iii) perfect, publish notice of or protect the validity of any Grant made or to be made by this Indenture; (iv) enforce any of the Collateral; (v) preserve and defend title to the Collateral and the rights of the Indenture Trustee and the Noteholders in such Collateral against the claims of all persons and parties; and (vi) pay all taxes or assessments levied or assessed upon the Collateral when due. The Issuer shall file the initial financing statements on Form UCC1. All financing statements filed or to be filed against the Issuer in favor of the Indenture Trustee in connection herewith describing the Collateral shall contain a statement to the following effect: "A purchase of or security interest in any collateral described in this financing statement, except as permitted in the Indenture, will violate the rights of the Secured Party." The Issuer hereby authorizes the Indenture Trustee to file all continuation statements or other instruments required to be executed pursuant to this Section and hereby designates the Indenture Trustee its agent and attorney-in-fact for such purpose. SECTION 3.06. OPINIONS AS TO COLLATERAL. On the Closing Date, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel to the effect that, in the opinion of such counsel, either (i) all financing statements and continuation statements have been executed and filed that are necessary to create and continue the Indenture Trustee's first priority perfected security interest in the Collateral for the benefit of the Noteholders, and reciting the details of such filings or (ii) no such action shall be necessary to perfect such security interest. SECTION 3.07. PERFORMANCE OF OBLIGATIONS; SERVICING OF CONTRACTS. (a) The Issuer will not take any action and will use its best efforts not to permit any action to be taken by others that would release any Person from any such Person's material covenants or obligations under any instrument or agreement included in the Collateral or that would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, any such instrument or agreement, 21 except as expressly provided in the Transaction Documents or such other instrument or agreement. (b) The Issuer may contract with other Persons to assist it in performing its duties and obligations under this Indenture, and any performance of such duties by a Person identified to the Indenture Trustee in an Officer's Certificate shall be deemed to be action taken by the Issuer. The Indenture Trustee shall not be responsible for the action or inaction of the Servicer or the Administrator. Initially, the Issuer has contracted with the Servicer and the Administrator to assist the Issuer in performing its duties under this Indenture. (c) The Issuer will punctually perform and observe all of its obligations and agreements contained in this Indenture, the other Transaction Documents and in the instruments and agreements included in the Collateral, including but not limited to filing or causing to be filed all UCC financing statements and continuation statements required to be filed by the terms of this Indenture and the Sale and Servicing Agreement in accordance with and within the time periods provided for herein and therein. Except as otherwise expressly provided therein, the Issuer shall not waive, amend, modify, supplement or terminate any Transaction Document or any provision thereof without the consent of the Indenture Trustee or the Required Holders. (d) If the Issuer shall have knowledge of the occurrence of an Event of Termination, the Issuer shall promptly notify the Indenture Trustee and each Rating Agency thereof. Upon any termination of the Servicer's rights and powers pursuant to the Sale and Servicing Agreement, the Issuer shall promptly notify the Indenture Trustee. As soon as a Successor Servicer is appointed, the Issuer shall notify the Indenture Trustee and the Rating Agencies of such appointment, specifying in such notice the name and address of such Successor Servicer. (e) The Issuer agrees that it will not waive timely performance or observance by the Servicer or the Seller of their respective duties under the Transaction Documents if the effect thereof would adversely affect the Holders of the Notes. SECTION 3.08. NEGATIVE COVENANTS. Until the Termination Date, the Issuer shall not: (i) except as expressly permitted by the Transaction Documents, sell, transfer, exchange or otherwise dispose of any of the properties or assets of the Issuer, including those included in the Collateral, unless directed to do so by the Indenture Trustee; (ii) claim any credit on, or make any deduction from the principal or interest payable in respect of, the Notes (other than amounts properly withheld from such payments under the Code or applicable state law) or assert any claim against any present or former Noteholder by reason of the payment of the taxes levied or assessed upon any part of the Collateral; (iii) (A) permit the validity or effectiveness of this Indenture to be impaired, or permit the lien created by this Indenture to be amended, hypothecated, subordinated, terminated or discharged, or permit any Person to be released from any covenant; or obligations with respect to the Notes under this Indenture except as may be 22 expressly permitted hereby, (B) permit any lien, charge, excise, claim, security interest, mortgage or other encumbrance (other than the lien of this Indenture) to be created on or extend to or otherwise arise upon or burden the Collateral or any part thereof or any interest therein or the proceeds thereof (other than tax liens, mechanics' liens and other liens that arise by operation of law, in each case on a Motorcycle and arising solely as a result of an action or omission of the related Obligor), (C) permit the lien created by this Indenture not to constitute a valid first priority (other than with respect to any such tax, mechanics' or other lien) security interest in the Collateral, or (D) amend, modify or fail to comply with the provisions of the Transaction Documents without the prior written consent of the Indenture Trustee, except where the Transaction Documents allow for amendment or modification without the consent or approval of the Indenture Trustee; (iv) dissolve or liquidate in whole or in part; or (v) change its name or state of formation. SECTION 3.09. ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer will deliver to the Indenture Trustee, on or before January 31 of each year commencing [_____], an Officer's Certificate stating, as to the Authorized Officer signing such Officer's Certificate, that: (i) a review of the activities of the Issuer during the prior calendar year and of performance under this Indenture has been made under such Authorized Officer's supervision; and (ii) to the best of such Authorized Officer's knowledge, based on such review, the Issuer has complied with all conditions and covenants under this Indenture throughout such year, or, if there has been a default in the compliance of any such condition or covenant, specifying each such default known to such Authorized Officer and the nature and status thereof. SECTION 3.10. ISSUER MAY CONSOLIDATE, ETC. ONLY ON CERTAIN TERMS. (a) The Issuer shall not consolidate or merge with or into any other Person, unless: (i) the Person (if other than the Issuer) formed by or surviving such consolidation or merger shall be a Person organized and existing under the laws of the United States or any State and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Indenture Trustee, in form and substance satisfactory to the Indenture Trustee, the due and punctual payment of the principal of and interest on all Notes and the performance or observance of every agreement and covenant of this Indenture and each other Transaction Document on the part of the Issuer to be performed or observed, all as provided herein; (ii) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; 23 (iii) the Rating Agency Condition shall have been satisfied with respect to such transaction; (iv) the Issuer shall have received an Opinion of Counsel which shall be delivered to and shall be satisfactory to the Indenture Trustee to the effect that such transaction will not have any material adverse tax consequence to the Trust, any Noteholder or any Certificateholder; (v) any action as is necessary to maintain the lien and security interest created by this Indenture shall have been taken; (vi) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate and an Opinion of Counsel (which shall describe the actions taken as required by clause (v) above or that no such actions will be taken) each stating that such consolidation or merger and such supplemental indenture comply with this Article Three and that all conditions precedent herein provided for relating to such transaction have been complied with; and (vii) the Person (if other than the Issuer) formed by or surviving such consolidation or merger has a net worth, immediately after such consolidation or merger, that is (A) greater than zero and (B) not less than the net worth of the Issuer immediately prior to giving effect to such consolidation or merger. (b) The Issuer shall not convey or transfer all or substantially all of its properties or assets, including those included in the Collateral, to any Person (except as expressly permitted by the Transaction Documents), unless: (i) the Person that acquires by conveyance or transfer the properties and assets of the Issuer shall (A) be a United States citizen or a Person organized and existing under the laws of the United States or any State, (B) expressly assume, by an indenture supplemental hereto, executed and delivered to the Indenture Trustee, in form and substance satisfactory to the Indenture Trustee, the due and punctual payment of the principal of and interest on all Notes and the performance or observance of every agreement and covenant of this Indenture and each other Transaction Document on the part of the Issuer to be performed or observed, all as provided herein, (C) expressly agree by means of such supplemental indenture that all right, title and interest so conveyed or transferred shall be subject and subordinate to the rights of Holders of the Notes and (D) unless otherwise provided in such supplemental indenture, expressly agree to indemnify, defend and hold harmless the Issuer against and from any loss, liability or expense arising under or related to this Indenture and the Notes. (ii) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; (iii) the Rating Agency Condition shall have been satisfied with respect to such transaction; 24 (iv) the Issuer shall have received an Opinion of Counsel which shall be delivered to and shall be satisfactory to the Indenture Trustee to the effect that such transaction will not have any material adverse tax consequence to the Trust, any Noteholder or any Certificateholder; (v) any action as is necessary to maintain the lien and security interest created by this Indenture shall have been taken; (vi) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate and an Opinion of Counsel (which shall describe the actions taken as required by clause (v) above or that no such actions will be taken) each stating that such conveyance or transfer and such supplemental indenture comply with this Article Three and that all conditions precedent herein provided for relating to such transaction have been complied with (including any filings required by Exchange Act); and (vii) the Issuer has a net worth, immediately after such conveyance or transfer, that is (A) greater than zero and (B) not less than the net worth of the Issuer immediately prior to giving effect to such conveyance or transfer. SECTION 3.11. SUCCESSOR OR TRANSFEREE. (a) Upon any consolidation or merger of the Issuer in accordance with Section 3.10(a), the Person formed by or surviving such consolidation or merger (if other than the Issuer) shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under this Indenture with same effect as if such Person has been named as the Issuer herein. (b) Upon a conveyance or transfer of all or substantially all the assets or properties of the Issuer pursuant to Section 3.10(b), the Issuer will be released from every covenant and agreement of this Indenture to be observed or performed on the part of the Issuer with respect to the Notes immediately upon the delivery of written notice to the Indenture Trustee stating that the Issuer is to be so released. SECTION 3.12. NO OTHER BUSINESS. The Issuer shall not engage in any business other than financing, purchasing, owning, selling and managing the Contracts in the manner contemplated by this Indenture and the other Transaction Documents and activities incidental thereto. SECTION 3.13. NO BORROWING. The Issuer shall not issue, incur, assume, guarantee or otherwise become liable, directly or indirectly, for any Indebtedness except for (i) the Notes and (ii) any other Indebtedness permitted by or arising under the other Transaction Documents. The proceeds of the Notes shall be used exclusively to fund the Issuer's purchase of the Contracts and the other assets specified in the Sale and Servicing Agreement, to fund the Reserve Fund and to pay the transactional expenses of the Issuer. SECTION 3.14. SERVICER'S OBLIGATIONS. The Issuer shall cause the Servicer to comply with Article Five and Article Nine of its obligations under the Sale and Servicing Agreement. 25 SECTION 3.15. GUARANTEES, LOANS ADVANCES AND OTHER LIABILITIES. Except as otherwise contemplated by the Transaction Documents, the Issuer shall not make any loan or advance or credit to, or guarantee (directly or indirectly or by an instrument having the effect of assuming another's payment or performance on any obligation or capability of so doing or otherwise), endorse or otherwise become contingently liable, directly or indirectly, in connection with the obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or agree contingently to do so) any stock, obligations, assets or securities of, any other interest in, or make any capital contribution to, any other Person. SECTION 3.16. CAPITAL EXPENDITURES. The Issuer shall not make any expenditure (by long-term or operating lease or otherwise) for capital assets (either realty or personalty). SECTION 3.17. RESTRICTED PAYMENTS. Except as permitted by the Transaction Documents, the Issuer shall not, directly or indirectly, (i) pay any dividend or make any distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, to the Owner Trustee or any owner of a beneficial interest in the Issuer or otherwise with respect to any ownership or equity interest or security in or of the Issuer or to the Servicer, (ii) redeem, purchase, retire or otherwise acquire for value any such ownership or equity interest or security or (iii) set aside or otherwise segregate any amounts for any such purpose; provided, however, that the Issuer may make, or cause to be made, (A) distributions to the Servicer, the Owner Trustee and the Certificateholder as contemplated by, and to the extent funds are available for such purpose under, the Sale and Servicing Agreement or the Trust Agreement and (B) payments to the Indenture Trustee and the Owner Trustee pursuant to Section 1(a)(ii) of the Administration Agreement. The Issuer will not, directly or indirectly, make payments to or distributions from the Collection Account except in accordance with this Indenture and the other Transaction Documents. SECTION 3.18. NOTICE OF EVENTS OF DEFAULT. The Issuer agrees to give the Indenture Trustee and each Rating Agency prompt written notice of each Event of Default hereunder and an Event of Termination under the Sale and Servicing Agreement. SECTION 3.19. FURTHER INSTRUMENTS AND ACTS. Upon request of the Indenture Trustee, the Issuer will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture. SECTION 3.20. COMPLIANCE WITH LAWS. The Issuer shall comply with the requirements of all applicable laws, the non-compliance with which would, individually or in the aggregate, materially and adversely affect the ability of the Issuer to perform its obligations under the Notes, this Indenture or any other Transaction Document. SECTION 3.21. AMENDMENTS OF SALE AND SERVICING AGREEMENT AND TRUST AGREEMENT. The Issuer shall not agree to any amendment to Section 11.01 of the Trust Agreement to eliminate the requirements thereunder that the Indenture Trustee or the Holders of the Notes consent to amendments thereto as provided therein. 26 SECTION 3.22. REMOVAL OF ADMINISTRATOR. So long as any Notes are issued and outstanding, the Issuer shall not remove the Administrator without cause unless the Rating Agency Condition shall have been satisfied in connection with such removal. ARTICLE FOUR SATISFACTION AND DISCHARGE SECTION 4.01. SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture shall cease to be of further effect with respect to the Notes except as to (i) rights of registration of transfer and exchange, (ii) substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments of principal thereof and interest thereon, (iv) Sections 3.01, 3.03, 3.04, 3.05, 3.07, 3.08, 3.10, 3.12, 3.13, 3.20 and 3.21, (v) the rights, obligations and immunities of the Indenture Trustee hereunder (including the rights of the Indenture Trustee under Section 6.07 and the obligations of the Indenture Trustee under Section 4.02) and (vi) the rights of Noteholders as beneficiaries hereof with respect to the property so deposited with the Indenture Trustee payable to all or any of them, and the Indenture Trustee, on demand of and at the expense of the Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect to the Notes, when (A) either (1) all Notes therefore authenticated and delivered (other than (i) Notes that have been destroyed, lost or stolen and that have been replaced or paid as provided in Section 2.05 and (ii) Notes for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from such trust, as provided in Section 3.03) have been delivered to the Indenture Trustee for cancellation; (2) all Notes not theretofore delivered to the Indenture Trustee for cancellation (i) have become due and payable, or (ii) will become due and payable at their respective final Distribution Dates within one year, or (iii) are to be called for redemption within one year under arrangements satisfactory to the Indenture Trustee for the giving of notice of redemption by the Indenture Trustee in the name, and at the expense, of the Issuer, and the Issuer, in the case of (i), (ii) or (iii) above, has irrevocably deposited or caused to be irrevocably deposited with the Indenture Trustee cash or direct obligations of or obligations guaranteed by the United States (which will mature prior to the date such amounts are payable), in trust in an Eligible Account for such purpose, in an amount sufficient to pay and 27 discharge the entire indebtedness on such Note not theretofore delivered to the Indenture Trustee for cancellation when due to the final scheduled Distribution Date (if Notes shall have been called for redemption pursuant to Section 10.01(a)), as the case may be; (B) the Issuer has paid or performed or caused to be paid or performed all amounts and obligations which the Issuer may owe to or on behalf of the Indenture Trustee for the benefit of the Noteholders under this Indenture or the Notes; and (C) the Issuer has delivered to the Indenture Trustee an Officer's Certificate and an Opinion of Counsel and (if required by the TIA or the Indenture Trustee) an Independent Certificate from a firm of certified public accountants, each meeting the applicable requirements of Section 11.01(a) and, subject to Section 11.02, stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with and the Rating Agency Condition has been satisfied. SECTION 4.02. APPLICATION OF TRUST MONEY. All moneys deposited with the Indenture Trustee pursuant to Section 4.01 shall be held in trust and applied by it, in accordance with the provisions of the Notes and this Indenture, to the payment, either directly or through any Paying Agent, as the Indenture Trustee may determine, to the Holders of the particular Notes for the payment or redemption of which such moneys have been deposited with the Indenture Trustee, of all sums due and to become due thereon for principal and interest; but such moneys need not be segregated from other funds except to the extent required herein or in the Sale and Servicing Agreement or required by law. SECTION 4.03. REPAYMENT OF MONEYS HELD BY PAYING AGENT. In connection with the satisfaction and discharge of this Indenture with respect to the Notes, all moneys then held by any Paying Agent other than the Indenture Trustee under the provisions of this Indenture with respect to such Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to be held and applied according to Section 3.03 and thereupon such Paying Agent shall be released from all further liability with respect to such moneys. SECTION 4.04. RELEASE OF COLLATERAL. Subject to Section 11.01 and the terms of the Transaction Documents, the Indenture Trustee shall release property from the lien of this Indenture only upon receipt of an Issuer Request accompanied by an Officer's Certificate and an Opinion of Counsel and Independent Certificates in accordance with TIA Sections 314(c) and 314(d)(1) or an Opinion of Counsel in lieu of such Independent Certificates to the effect that the TIA does not require any such Independent Certificates. ARTICLE FIVE REMEDIES SECTION 5.01. EVENTS OF DEFAULT. "Event of Default," wherever used herein, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any 28 judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (i) default in the payment of any interest on any Note when the same becomes due and payable, and such default shall continue for a period of five days; (ii) default in the payment of the principal of or any installment of the principal of any Note when the same becomes due and payable; (iii) default in the observance or performance of any covenant or agreement of the Issuer made in this Indenture (other than a covenant or agreement, a default in the observance or performance of which is elsewhere in this Section specifically dealt with) which default has a material adverse effect on the Noteholders, or any representation or warranty of the Issuer made in this Indenture or in any certificate or other writing delivered pursuant hereto or in connection herewith proving to have been incorrect in any material respect as of the time when the same shall have been made, and such default shall continue or not be cured, or the circumstance or condition in respect of which such misrepresentation or warranty was incorrect shall not have been eliminated or otherwise cured, for a period of 30 days after there shall have been given, by registered or certified mail, to the Indenture Trustee by the Holders of at least 25% of the Outstanding Amount of the Class A-1 Notes and the Class A-2 Notes, taken together as a single class, or, if there are no Class A-1 Notes or Class A-2 Notes Outstanding, by the Holders of at least 25% of the Outstanding Amount of the Class B Notes a written notice specifying such default or incorrect representation or warranty and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder; (iv) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of the Issuer or any substantial part of the Collateral in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Issuer or for any substantial part of the Collateral, or ordering the winding-up or liquidation of the Issuer's affairs, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or (v) the commencement by the Issuer of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by the Issuer to the entry of an order for relief in an involuntary case under any such law, or the consent by the Issuer to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of the Issuer or for any substantial part of the Collateral, or the making by the Issuer of any general assignment for the benefit of creditors, or the failure by the Issuer generally to pay its debts as such debts become due, or the taking of action by the Issuer in furtherance of any of the foregoing. The Issuer shall deliver to the Indenture Trustee within five days after obtaining knowledge of the occurrence thereof, written notice in the form of an Officer's Certificate of any event which with the giving of notice and the lapse of time would become 29 an Event of Default under clause (iii) above, its status and what action the Issuer is taking or proposes to take with respect thereto. SECTION 5.02. RIGHTS UPON EVENT OF DEFAULT. If an Event of Default shall have occurred and be continuing, other than an Event of Default described in Section 5.01(iv) or (v) above, the Indenture Trustee or the Modified Required Holders may declare the principal amount of the Notes immediately due and payable at par. At any time after such declaration of acceleration of maturity has been made and before a judgment or decree for payment of the money due has been obtained by the Indenture Trustee as hereinafter in this Article Five, PROVIDED, the Required Holders may rescind such declaration if (i) the Issuer has made all payments of principal of and interest on all Notes when the same becomes due and payable and (ii) the Issuer has paid all amounts due and payable to the Indenture Trustee. If an Event of Default described in Section 5.01(iv) or (v) shall have occurred and be continuing, the principal amount of the Notes shall become immediately due and payable. SECTION 5.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY INDENTURE TRUSTEE; AUTHORITY OF INDENTURE TRUSTEE. (a) The Issuer covenants that if the Notes are accelerated following the occurrence of an Event of Default, the Issuer will, upon demand of the Indenture Trustee, pay to it, for the benefit of the Holders of the Notes, the whole amount then due and payable on such Notes for principal and interest, with interest upon the overdue principal, and, to the extent payment at such rate of interest shall be legally enforceable, upon overdue installments of interest, at the applicable Interest Rate and in addition thereto such further amount as shall be sufficient to cover costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Indenture Trustee and its agents and counsel. (b) The Indenture Trustee following the occurrence of an Event of Default, shall have full right, power and authority to take, or defer from taking, any and all acts with respect to the administration, maintenance or disposition of the Collateral. (c) If an Event of Default occurs and is continuing, the Indenture Trustee may in its discretion (except as provided in Section 5.03(d)), proceed to protect and enforce its rights and the rights of the Noteholders, by such appropriate Proceedings as the Indenture Trustee shall deem most effective to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy or legal or equitable right vested in the Indenture Trustee by this Indenture or by law. (d) Notwithstanding anything to the contrary contained in this Indenture, if an Event of Default shall have occurred and be continuing and if the Issuer fails to perform its obligations under Section 10.01(b) when and as due, the Indenture Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Noteholders by such appropriate Proceedings as the Indenture Trustee shall deem most effective to protect and enforce any such rights, whether for specific performance of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other 30 proper remedy or legal or equitable right vested in the Indenture Trustee by this Indenture or by law, provided that the Indenture Trustee shall only be entitled to take any such actions to the extent such actions (i) are taken only to enforce the Issuer's obligations to redeem the principal amount of Notes, and (ii) are taken only against the Collateral any investments therein and any proceeds thereof. (e) In case there shall be pending, relative to the Issuer or any other obligor upon the Notes or any Person having or claiming an ownership interest in the Collateral, Proceedings under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or other similar law, or in case a receiver, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or similar official shall have been appointed for or taken possession of the Issuer or its property or such other obligor or Person, or in case of any other comparable judicial Proceedings relative to the Issuer or other obligor upon the Notes, or to the creditors or property of the Issuer or such other obligor, the Indenture Trustee, irrespective of whether the principal of any Notes shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Indenture Trustee shall have made any demand pursuant to the provisions of this Section, shall be entitled and empowered, by intervention in such Proceedings or otherwise: (i) to file and prove a claim or claims for the whole amount of principal and interest owing and unpaid in respect of the Notes and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee (including any claim for reasonable compensation to the Indenture Trustee and each predecessor Indenture Trustee, and their respective agents, attorneys and counsel, and for reimbursement of all expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee, except as a result of negligence or bad faith) and of the Noteholders allowed in such Proceedings; (ii) unless prohibited by applicable law and regulations, to vote on behalf of the Holders of Notes in any election of a trustee, a standby trustee or Person performing similar functions in any such Proceedings; (iii) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute all amounts received with respect to the claims of the Noteholders and of the Indenture Trustee on their behalf; and (iv) to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee or the Holders of Notes allowed in any judicial proceedings relative to the Issuer, its creditors and its property; and any trustee, receiver, liquidator, custodian or other similar official in any such Proceeding is hereby authorized by each of such Noteholders to make payments to the Indenture Trustee, and, in the event that the Indenture Trustee shall consent to the making of payments directly to such Noteholders, to pay to the Indenture Trustee such amounts as shall 31 be sufficient to cover reasonable compensation to the Indenture Trustee, each predecessor Indenture Trustee and their respective agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee except as a result of negligence or bad faith. (f) Nothing herein contained shall be deemed to authorize the Indenture Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Noteholder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof or to authorize the Indenture Trustee to vote in respect of the claim of any Noteholder in any such proceeding except, as aforesaid, to vote for the election of a trustee in bankruptcy or similar Person. (g) All rights of action and of asserting claims under this Indenture or under any of the Notes, may be enforced by the Indenture Trustee without the possession of any of the Notes or the production thereof in any trial or other Proceedings relative thereto, and any such action or Proceedings instituted by the Indenture Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment, subject to the payment of the expenses, disbursements and compensation of the Indenture Trustee, each predecessor Indenture Trustee and their respective agents and attorneys, shall be for the ratable benefit of the Holders of the Notes. (h) In any Proceedings brought by the Indenture Trustee (including any Proceedings involving the interpretation of any provision of this Indenture), the Indenture Trustee shall be held to represent all of the Holders of the Notes, and it shall not be necessary to make any Noteholder a party to any such proceedings. SECTION 5.04. REMEDIES. If an Event of Default shall have occurred and be continuing, the Indenture Trustee (subject to Section 5.05) may, and shall if so directed by the Required Holders in writing: (i) institute Proceedings in its own name and as or on behalf of a trustee of an express trust for the collection of all amounts then payable on the Notes or under this Indenture with respect thereto, whether by declaration or otherwise, enforce any judgment obtained, and collect from the Issuer and any other obligor upon such Notes moneys adjudged due; (ii) institute Proceedings from time to time for the complete or partial foreclosure of this Indenture with respect to the Collateral; (iii) exercise any remedies of a secured party under the UCC and any other remedy available to the Indenture Trustee and take any other appropriate action to protect and enforce the rights and remedies of the Indenture Trustee on behalf of the Noteholders under this Indenture or the Notes; and (iv) sell the Collateral or any portion thereof or rights or interest therein, at one or more public or private sales called and conducted in any manner permitted by law; provided, however, that the Indenture Trustee may not sell or otherwise liquidate the Collateral following an Event of Default, unless (A) the Holders of 100% of the Outstanding 32 Amount of the Notes, consent thereto, (B) the proceeds of such sale or liquidation distributable to the Noteholders are sufficient to discharge in full all amounts then due and unpaid upon such Notes for principal and interest, (C) there has been an Event of Default described in Section 5.01(i) or (ii) and (D) the Indenture Trustee determines that the Collateral will not continue to provide sufficient funds for the payment of principal of and interest on the Notes as they would have become due if the Notes had not been declared due and payable, and the Indenture Trustee provides prior written notice to each Rating Agency and obtains the consent of the Required Holders. In determining such sufficiency or insufficiency with respect to clauses (B) and (C), the Indenture Trustee may, but need not, obtain and rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Collateral for such purpose; provided, however, upon the occurrence of an Event of Default described in Section 5.01(iv) or (v), caused solely from an event described in such subparagraphs occurring with respect to the Trust Depositor, the Collateral will be liquidated by the Indenture Trustee and the Trust will be terminated 90 days after the date of such Insolvency Event, unless, before the end of such 90-day period, the related Trustee shall have received written instructions from the Required Holders, to the effect that such Required Holders disapprove of the liquidation of such Collateral and termination of such Trust. SECTION 5.05. OPTIONAL PRESERVATION OF THE CONTRACTS. Following an Event of Default and if such Event of Default has not been rescinded and annulled, the Indenture Trustee may, but need not, elect to maintain possession of the Collateral. It is the desire of the parties hereto and the Noteholders that there be at all times sufficient funds for the payment of principal and interest on the Notes, and the Indenture Trustee shall take such desire into account when determining whether or not to maintain possession of the Collateral. In determining whether to maintain possession of the Collateral, the Indenture Trustee may, but need not, obtain and rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Collateral for such purpose. SECTION 5.06. PRIORITIES. (a) If the Indenture Trustee collects any money or property pursuant to this Article Five, it shall pay out the money or property in the order and priority set forth in Section 7.05(b) or (c) of the Sale and Servicing Agreement. (b) The Indenture Trustee may fix a record date and payment date for any payment to Noteholders pursuant to this Section. At least 15 days before such record date, the Issuer shall mail to each Noteholder and the Indenture Trustee a notice that states the record date, the payment date and the amount to be paid. SECTION 5.07. LIMITATION OF SUITS. No Holder of any Note shall have any right to institute any Proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless (and in all events subject to Section 11.16 hereof): 33 (i) such Holder has previously given written notice to the Indenture Trustee of a continuing Event of Default; (ii) the Holders of not less than 25% of the Outstanding Amount of the Class A-1 Notes and the Class A-2 Notes, or, if there are no Class A-1 Notes or Class A-2 Notes Outstanding, Holders of not less than 25% of the Outstanding Amount of the Class B Notes have made written request to the Indenture Trustee to institute such Proceeding in respect of such Event of Default in its own name as Indenture Trustee hereunder; (iii) such Holder or Holders have offered to the Indenture Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in complying with such request; (iv) the Indenture Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute such Proceedings; and (v) no direction inconsistent with such written request has been given to the Indenture Trustee during such 60-day period by the Required Holders. It is understood and intended that no one or more Holders of Notes shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Holders of Notes or to obtain or to seek to obtain priority or preference over any other Holders or to enforce any right under this Indenture, except in the manner herein provided. In the event the Indenture Trustee shall receive conflicting or inconsistent requests and indemnity from two or more groups of Holders of Notes, each representing less than a majority of the Outstanding Amount of the Class A-1 Notes and the Class A-2 Notes or the Class B Notes, as the case may be, the Indenture Trustee shall act at the direction of the group of Holders of Notes with the greater Outstanding Amount of Class A-1 Notes, Class A-2 Notes, or Class B Notes, as the case may be; provided, however, if the Indenture Trustee receives conflicting or inconsistent requests and indemnity from two or more groups of Holders of Notes representing an equal Outstanding Amount of the Class A-1 Notes, Class A-2 Notes or Class B Notes, the Indenture Trustee in its sole discretion may determine what action, if any, shall be taken, notwithstanding any other provisions of this Indenture. SECTION 5.08. UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL AND INTEREST. Notwithstanding any other provisions in the Indenture, the Holder of any Note shall have the right, which is absolute and unconditional, to receive payment of the principal of and interest on such Note on or after the respective due dates thereof expressed in such Note or in this Indenture (or, in the case of redemption, on or after the Redemption Date) and to institute suit for the enforcement of any such payment, and such right shall not be impaired without the consent of such Holder. SECTION 5.09. RESTORATION OF RIGHTS AND REMEDIES. If the Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason or has been determined adversely to the Indenture Trustee or to such Noteholder, then and in every 34 such case the Indenture Trustee and the Noteholders shall, subject to any determination in such Proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all rights and remedies of the Indenture Trustee and the Noteholders shall continue as though no such Proceeding had been instituted. SECTION 5.10. RIGHTS AND REMEDIES CUMULATIVE. No right or remedy herein conferred upon or reserved to the Indenture Trustee or to the Noteholders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. SECTION 5.11. DELAY OR OMISSION NOT A WAIVER. No delay or omission of the Indenture Trustee or any Holder of any Note to exercise any right or remedy accruing upon any Default of Event of Default shall impair any such right or remedy or constitute a waiver of any such Default or Event of Default or an acquiescence therein. Every right and remedy given by this Article Five or by law to the Indenture Trustee or to the Noteholders may be exercised from time to time, and as often as may be deemed expedient, by the Indenture Trustee or by the Noteholders, as the case may be. SECTION 5.12. CONTROL BY NOTEHOLDERS. The Required Holders shall have the right to direct the time, method and place of conducting any Proceeding for any remedy available to the Indenture Trustee with respect to the Notes or exercising any trust or power conferred on the Indenture Trustee; provided that: (i) such direction shall not be in conflict with any rule of law or with this Indenture; (ii) subject to the terms of Section 5.04, any direction to the Indenture Trustee to sell or liquidate the Collateral shall be by the Holders of Notes representing not less than 100% of the Outstanding Amount of the Notes; (iii) if the conditions set forth in Section 5.05 have been satisfied and the Indenture Trustee elects to retain the Collateral pursuant to such Section, then any direction to the Indenture Trustee by Holders of Notes representing less than 100% of the Outstanding Amount of the Notes to sell or liquidate the Collateral shall be of no force and effect; and (iv) the Indenture Trustee may take any other action deemed proper by the Indenture Trustee that is not inconsistent with such direction. Notwithstanding the rights of Noteholders set forth in this Section, subject to Section 6.01, the Indenture Trustee need not take any action that it determines might involve it in liability or might materially and adversely affect the rights of any Noteholders not consenting to such action. SECTION 5.13. WAIVER OF PAST DEFAULTS. In the case of any waiver of an Event of Default, the Issuer, the Indenture Trustee and the Holders of the Notes shall be restored to 35 their former positions and rights hereunder, respectively; but no such waiver shall extend to any subsequent or other Event of Default or impair any right consequent thereto. Upon any such waiver, such Event of Default shall cease to exist and be deemed to have been cured and not to have occurred, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereto. SECTION 5.14. UNDERTAKING FOR COSTS. All parties to this Indenture agree, and each Holder of any Note by such Holder's acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Indenture Trustee for any action taken, suffered or omitted by it as Indenture Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to (i) any suit instituted by the Indenture Trustee, (ii) any suit instituted by any Noteholder, or group of Noteholders, in each case holding in the aggregate more than 10% of the Outstanding Amount of the Class A-1 Notes and the Class A-2 Notes, or, if there are no Class A-1 Notes, Class A-2 Notes Outstanding, any Noteholder or group of Noteholders holding in the aggregate 10% of the Outstanding Amount of the Class B Notes or (iii) any suit instituted by any Noteholder for the enforcement of the payment of principal of or interest on any Note on or after the respective due dates expressed in such Note and in this Indenture (or, in the case of redemption, on or after the Redemption Date). SECTION 5.15. WAIVER OF STAY OR EXTENSION LAWS. The Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead or in any manner whatsoever, claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantages of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Indenture Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. SECTION 5.16. ACTION ON NOTES. The Indenture Trustee's right to seek and recover judgment on the Notes or under this Indenture shall not be affected by the seeking, obtaining or application of any other relief under or with respect to this Indenture. Neither the lien of this Indenture nor any rights or remedies of the Indenture Trustee or the Noteholders shall be impaired by the recovery of any judgment by the Indenture Trustee against the Issuer or by the levy of any execution under such judgment upon any portion of the Collateral or upon any of the assets of the Issuer. Any money or property collected by the Indenture Trustee shall be applied in accordance with Section 5.06. SECTION 5.17. PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS. 36 (a) Promptly following a request from the Indenture Trustee to do so and at the Administrator's expense, the Issuer shall take all such lawful action as the Indenture Trustee may request to compel or secure the performance and observance by the Trust Depositor and the Servicer, as applicable, of each of their obligations to the Issuer under or in connection with the Sale and Servicing Agreement in accordance with the terms thereof, and to exercise any and all rights, remedies, powers and privileges lawfully available to the Issuer under or in connection with the Sale and Servicing Agreement to the extent and in the manner directed by the Indenture Trustee, including the transmission of notices of default on the part of the Trust Depositor or the Servicer thereunder and the institution of legal of administrative actions or proceedings to compel or secure performance by the Trust Depositor or the Servicer of each of their obligations under the Sale and Servicing Agreement. (b) If an Event of Default has occurred and is continuing, the Indenture Trustee may, and at the direction (which direction shall be in writing, including facsimile) of the Modified Required Holders shall exercise all rights, remedies, powers, privileges and claims of the Issuer against the Trust Depositor or the Servicer under or in connection with the Sale and Servicing Agreement, including the right or power to take any action to compel or secure performance or observance by the Trust Depositor or the Servicer of each of their obligations to the Issuer thereunder and to give any consent, request, notice, direction, approval, extension or waiver under the Sale and Servicing Agreement, and any right of the Issuer to take such action shall be suspended. ARTICLE SIX THE INDENTURE TRUSTEE SECTION 6.01. DUTIES OF INDENTURE TRUSTEE. (a) If an Event of Default has occurred and is continuing, the Indenture Trustee shall exercise the rights and powers vested in it by this Indenture and in the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs. (b) Except during the continuance of an Event of Default: (i) the Indenture Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Indenture Trustee; and (ii) in the absence of bad faith on its part, the Indenture Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Indenture Trustee and conforming to the requirements of this Indenture; however, the Indenture Trustee shall examine the certificates and opinions to determine whether or 37 not they conform to the requirements of this Indenture and the other Transaction Documents to which the Indenture Trustee is a party. (c) The Indenture Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willful misconduct, except that: (i) this paragraph does not limit the effect of Section 6.01(b); (ii) the Indenture Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer unless it is proved that the Indenture Trustee was negligent in ascertaining the pertinent facts; and (iii) the Indenture Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 5.12. (d) Every provision of this Indenture that in any way relates to the Indenture Trustee is subject to paragraphs (a), (b) and (c) of this Section. (e) The Indenture Trustee shall not be liable for interest on any money received by it except as the Indenture Trustee may agree in writing with the Issuer. (f) Money held in trust by the Indenture Trustee need not be segregated from other funds except to the extent required by law or the terms of this Indenture or the Sale and Servicing Agreement. (g) No provision of this Indenture shall require the Indenture Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayments of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. (h) The Indenture Trustee shall have no discretionary duties other than performing those ministerial acts set forth above necessary to accomplish the purpose of this Trust as set forth in this Indenture. (i) Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Indenture Trustee shall be subject to the provisions of this section and to the provisions of the TIA. SECTION 6.02. RIGHTS OF INDENTURE TRUSTEE. (a) The Indenture Trustee may rely on any document believed by it to be genuine and to have been signed or presented by the proper person. The Indenture Trustee need not investigate any fact or matter stated in the document. (b) Before the Indenture Trustee acts or refrains from acting, it may require an Officer's Certificate (with respect to factual matters) or an Opinion of Counsel, as 38 applicable. The Indenture Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on the Officer's Certificate or Opinion of Counsel. (c) The Indenture Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through Affiliates, agents or attorneys or a custodian or nominee, and the Indenture Trustee shall not be responsible for any misconduct or negligence on the part of, or for the supervision of, any such agent, attorney, custodian or nominee appointed with due care by it hereunder. (d) The Indenture Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers; provided, however, that the Indenture Trustee's conduct does not constitute willful misconduct, negligence or bad faith. (e) The Indenture Trustee may consult with counsel, and the advice of such counsel or any Opinion of Counsel with respect to legal matters relating to this Indenture and the Notes shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered by it hereunder in good faith and in accordance with such advice or Opinion of Counsel. (f) The Indenture Trustee shall be under no obligation to institute, conduct or defend any litigation under this Indenture or in relation to this Indenture, at the request, order or direction of any of the Holders of Notes, pursuant to the provisions of this Indenture, unless such Holders of Notes shall have offered to the Indenture Trustee reasonable security or indemnity against the costs, expenses and liabilities that may be incurred therein or thereby; provided, however, that the Indenture Trustee shall, upon the occurrence of an Event of Default (that has not been cured), exercise the rights and powers vested in it by this Indenture in a manner consistent with Section 6.01. (g) The Indenture Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond or other paper or document, unless so requested by the Holders of Notes evidencing not less than 25% of the Outstanding Amount of the Notes; provided, however, that if the payment within a reasonable time to the Indenture Trustee of the costs, expenses or liabilities likely to be incurred by it in the making of such investigation is, in the opinion of the Indenture Trustee, not reasonably assured to the Indenture Trustee by the security afforded to it by the terms of this Indenture or the Sale and Servicing Agreement, the Indenture Trustee may require reasonable indemnity against such cost, expense or liability as a condition to so proceeding; the reasonable expense of every such examination shall be paid by the Person making such request, or, if paid by the Indenture Trustee, shall be reimbursed by the Person making such request upon demand. SECTION 6.03. INDIVIDUAL RIGHTS OF INDENTURE TRUSTEE. The Indenture Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Issuer or its Affiliates with the same rights it would have if it were not Indenture Trustee. Any Paying Agent, Note Registrar, co-registrar or co-paying agent 39 may do the same with like rights. However, the Indenture Trustee is required to comply with Section 6.11. SECTION 6.04. INDENTURE TRUSTEE'S DISCLAIMER. The Indenture Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture, the Collateral or the Notes, it shall not be accountable for the Issuer's use of the proceeds from the Notes, and it shall not be responsible for any statement of the Issuer in this Indenture or in any document issued in connection with the sale of the Notes or in the Notes other than the Indenture Trustee's certificate of authentication. SECTION 6.05. NOTICE OF DEFAULTS. If a Default occurs and is continuing and if it is known to a Responsible Officer of the Indenture Trustee, the Indenture Trustee shall mail to each Noteholder notice of the Default within 90 days after it occurs. Except in the case of a Default in payment of principal of or interest on any Note (including payments pursuant to the redemption of such Notes), the Indenture Trustee may withhold the notice if and so long as a committee of its Responsible Officers in good faith determines that withholding the notice is in the interests of Noteholders. SECTION 6.06. REPORTS BY INDENTURE TRUSTEE TO HOLDERS. Within the prescribed period of time for tax reporting purposes after the end of each calendar year during the term of this Indenture, the Indenture Trustee shall deliver to each Noteholder such information, including without limitation, IRS Form 1099, as may be required by applicable law to enable such holder to prepare its federal and state income tax returns. SECTION 6.07. COMPENSATION AND INDEMNITY. The Issuer shall pay or shall cause the Administrator to pay to the Indenture Trustee from time to time reasonable compensation for its services. The Indenture Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Issuer shall or shall cause the Administrator to reimburse the Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Indenture Trustee's agents, counsel, accountants and experts. The Issuer shall indemnify or shall cause the Administrator to indemnify the Indenture Trustee against any and all loss, liability or expense (including attorneys' fees) incurred by it in connection with the administration of this trust and the performance of its duties hereunder. The Indenture Trustee shall notify the Issuer and the Administrator promptly of any claim for which it may seek indemnity. Failure by the Indenture Trustee to so notify the Issuer and the Administrator shall not relieve the Issuer or the Administrator of its obligations hereunder. The Issuer shall defend or shall cause the Administrator to defend any such claim, and the Indenture Trustee may have separate counsel and the Issuer shall pay or shall cause the Administrator to pay the fees and expenses of such counsel. Neither the Issuer nor the Administrator need reimburse any expense or indemnify against any loss, liability or expense incurred by the Indenture Trustee through the Indenture Trustee's own willful misconduct, negligence or bad faith. The Issuer's payment obligations and indemnification to the Indenture Trustee pursuant to this Section shall survive the resignation or removal of the Indenture Trustee and 40 the termination and discharge of this Indenture; provided that the Indenture Trustee shall be entitled only to compensation for its services for the period prior to the date of such resignation or removal of the Indenture Trustee. When the Indenture Trustee incurs expenses after the occurrence of an Event of Default specified in Section 5.01(iv) or (v) with respect to the Issuer, the expenses are intended to constitute expenses of administration under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or similar law. SECTION 6.08. REPLACEMENT OF INDENTURE TRUSTEE. The Indenture Trustee may resign at any time by so notifying the Issuer and the Servicer. The Issuer shall remove the Indenture Trustee if: (i) the Indenture Trustee fails to comply with Section 6.11; (ii) a court having jurisdiction in the premises in respect of the Indenture Trustee in an involuntary case or proceeding under federal or state banking or bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law, shall have entered a decree or order granting relief or appointing a receiver, liquidator, assignee, custodian, trustee, conservator, sequestrator (or similar official) for the Indenture Trustee or for any substantial part of the Indenture Trustee's property, or ordering the winding-up or liquidation of the Indenture Trustee's affairs, provided any such decree or order shall have continued unstayed and in effect for a period of 30 consecutive days; (iii) the Indenture Trustee commences a voluntary case under any federal or state banking or bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law, or consents to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, conservator, sequestrator or other similar official for the Indenture Trustee or for any substantial part of the Indenture Trustee's property, or makes any assignment for the benefit of creditors or fails generally to pay its debts as such debts become due or takes any corporate action in furtherance of any of the foregoing; or (iv) the Indenture Trustee otherwise becomes incapable of acting. If the Indenture Trustee resigns or is removed, the Issuer shall promptly appoint a successor Indenture Trustee. A successor Indenture Trustee shall deliver a written acceptance of its appointment to the retiring Indenture Trustee and to the Issuer. Thereupon the resignation or removal of the retiring Indenture Trustee shall become effective, and the successor Indenture Trustee shall have all the rights, powers and duties of the Indenture Trustee under this Indenture. The Issuer or the successor Indenture Trustee shall mail a notice of its succession to Noteholders. The retiring Indenture Trustee shall promptly transfer all property held by it as Indenture Trustee to the successor Indenture Trustee. If a successor Indenture Trustee does not take office within 60 days after the retiring Indenture Trustee resigns or is removed, the retiring Indenture Trustee, the Issuer or the 41 Holders of a majority in Outstanding Amount of the Notes may appoint or petition any court of competent jurisdiction for the appointment of a successor Indenture Trustee. If the Indenture Trustee fails to comply with Section 6.11, any Noteholder may petition any court of competent jurisdiction for the removal of the Indenture Trustee and the appointment of a successor Indenture Trustee. Any resignation or removal of the Indenture Trustee and appointment of a successor Indenture Trustee pursuant to any of the provisions of this Section shall not become effective until acceptance of appointment by the successor Indenture Trustee pursuant to this Section and payment of all fees and expenses owed to the outgoing Indenture Trustee. Notwithstanding the replacement of the Indenture Trustee pursuant to this Section, the retiring Indenture Trustee shall be entitled to payment or reimbursement of such amounts as such Person is entitled pursuant to Section 6.07. SECTION 6.09. SUCCESSOR INDENTURE TRUSTEE BY MERGER. If the Indenture Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Indenture Trustee; provided, that such corporation or banking association shall be otherwise qualified and eligible under Section 6.11. The Indenture Trustee shall provide each Rating Agency prompt notice of any such transaction. In case at the time such successor or successors by merger, conversion or consolidation to the Indenture Trustee shall succeed to the trusts created by this Indenture, any of the Notes shall have been authenticated but not delivered, any such successor to the Indenture Trustee may adopt the certificate of authentication of any predecessor Indenture Trustee, and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to the Indenture Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor to the Indenture Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Notes or in this Indenture provided that the certificate of the Indenture Trustee shall have. SECTION 6.10. APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE INDENTURE TRUSTEE. (a) Notwithstanding any other provision of this Indenture, at any time, for the purpose of meeting any legal requirement of any jurisdiction in which any part of the Collateral may at the time be located, the Indenture Trustee and the Administrator acting jointly shall have the power and may execute and deliver all instruments to appoint one or more Persons to act as a co-Indenture Trustee or co-Indenture Trustees, jointly with the Indenture Trustee, or separate Indenture Trustee or separate Indenture Trustees, of all or any part of the Trust, and to vest in such Person or Persons, in such capacity and for the benefit of the Noteholders, such title to the Collateral, or any part hereof, and, subject to the other provisions of this Section, such powers, duties, obligations, rights and trusts as the Indenture Trustee and the Administrator may consider necessary or desirable. If the Administrator shall not have joined in such appointment within 15 days after the receipt by it of a request 42 so to do, the Indenture Trustee alone shall have the power to make such appointment. No co-Indenture Trustee or separate Indenture Trustee hereunder shall be required to meet the terms of eligibility of a successor Indenture Trustee under Section 6.11 and no notice to Noteholders of the appointment of any co-Indenture Trustee or separate Indenture Trustee shall be required under Section 6.08. (b) Every separate Indenture Trustee and co-Indenture Trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: (i) all rights, powers, duties and obligations conferred or imposed upon the Indenture Trustee shall be conferred or imposed upon and exercised or performed by the Indenture Trustee and such separate Indenture Trustee or co-Indenture Trustee jointly (it being understood that such separate Indenture Trustee or co-Indenture Trustee is not authorized to act separately without the Indenture Trustee joining in such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed the Indenture Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding of title to the Trust or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate Indenture Trustee or co-Indenture Trustee, but solely at the direction of the Indenture Trustee; (ii) no Indenture Trustee hereunder shall be personally liable by reason of any act or omission of any other Indenture Trustee hereunder; and (iii) the Indenture Trustee and the Administrator may at any time accept the resignation of or remove any separate Indenture Trustee or co-Indenture Trustee. (c) Any notice, request or other writing given to the Indenture Trustee shall be deemed to have been given to each of the then separate Indenture Trustees and co-Indenture Trustees, as effectively as if given to each of them. Every instrument appointing any separate Indenture Trustee or co-Indenture Trustee shall refer to this Agreement and the conditions of this Article. Each separate Indenture Trustee and co-Indenture Trustee, upon its acceptance of the trusts conferred, shall be vested with the estates or property specified in its instrument of co-appointment, either jointly with the Indenture Trustee or separately, as may be provided therein, subject to all the provisions of this Indenture, specifically including every provision of this Indenture relating to the conduct of, affecting the liability of or affording protection to, the Indenture Trustee. Every such instrument shall be filed with the Indenture Trustee and a copy thereof given to the Administrator. (d) Any separate Indenture Trustee or co-Indenture Trustee may at any time constitute the Indenture Trustee, its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Agreement on its behalf and in its name. If any separate Indenture Trustee or co-Indenture Trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Indenture 43 Trustee, to the extent permitted by law, without the appointment of a new or successor Indenture Trustee. Notwithstanding anything to the contrary in this Indenture, the appointment of any separate Indenture Trustee or co-Indenture Trustee shall not relieve the Indenture Trustee of its obligations and duties under this Indenture. SECTION 6.11. ELIGIBILITY. (a) The Indenture Trustee shall at all times satisfy the requirements of TIA Section 310(a). The Indenture Trustee hereunder shall at all times be a financial institution organized and doing business under the laws of the United States of America or any state, authorized under such laws to exercise corporate trust powers. The Indenture Trustee or its parent shall have a long term unsecured debt rating of at least Baa3 by Moody's and shall have a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by federal or state authority, provided that the Indenture Trustee's separate capital and surplus shall at all times be at least the amount required by Section 310(a)(2) of the TIA. If such Person publishes reports of condition at least annually, pursuant to law or to the requirements of a supervising or examining authority, then for the purposes of this Section 6.ll, the combined capital and surplus of such Person shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. (b) If a Default occurs and is continuing and the Indenture Trustee is deemed to have a "conflicting interest" (as defined in the TIA) as a result of acting as trustee for both the Class A-1 Notes and the Class A-2 Notes and the Class B Notes, the Issuer shall appoint a successor Indenture Trustee for the Class A-1 Notes and the Class A-2 Notes and a successor Indenture Trustee for the Class B Notes so that there will be separate Indenture Trustees for the Class A-1 Notes and the Class A-2 Notes on the one hand, and for the Class B Notes on the other hand. No such event shall alter the voting rights of the Noteholders under this Indenture or under any of the other Transaction Documents. (c) In the case of an appointment hereunder of a successor Indenture Trustee with respect to any Class of Notes, the Issuer, the retiring Indenture Trustee and the successor Indenture Trustee with respect to such Class of Notes shall execute and deliver an indenture supplement hereto wherein the successor Indenture Trustee shall accept such appointment and which (i) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, the successor Indenture Trustee all rights, powers, trusts and duties of the retiring Indenture Trustee with respect to the Notes of such Class as to which the appointment of such Indenture Trustee relates, (ii) if the retiring Indenture Trustee is not retiring with respect to all Classes of Notes, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Indenture Trustee with respect to the Notes of each Class as to which the retiring Indenture Trustee is not retiring shall continue to be vested in the retiring Indenture Trustee and (iii) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Indenture Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Indenture Trustees co-trustees of the same trust and that each such Indenture Trustee; and upon execution and delivery of such supplemental 44 indenture the resignation or removal of the retiring Indenture Trustee shall become effective to the extent provided therein. (d) In case at any time the Indenture Trustee shall cease to be eligible in accordance with the provisions of this Section 6.11, the Indenture Trustee shall resign immediately in the manner and with the effect specified in Section 6.08. The Indenture Trustee shall comply with TIA Section 310(b); provided, however, that there shall be excluded from the operation of TIA Section 310(b)(1) any indenture or indentures under which other securities of the Issuer are outstanding if the requirements for such exclusion set forth in TIA Section 310(b)(1) are met. SECTION 6.12. PENNSYLVANIA MOTOR VEHICLE SALES FINANCE ACT LICENSES. The Indenture Trustee shall use its best efforts to maintain the effectiveness of all licenses required under the Pennsylvania Motor Vehicle Sales Finance Act in connection with this Indenture and the transactions contemplated hereby until the lien and security interest of this Indenture shall no longer be in effect in accordance with the terms hereof. SECTION 6.13. PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER. The Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). An Indenture Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated. ARTICLE SEVEN NOTEHOLDERS' LISTS AND REPORTS SECTION 7.01. ISSUER TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES OF NOTEHOLDERS. The Issuer will furnish or cause to be furnished to the Indenture Trustee (i) not more than five days after the earlier of (a) each Record Date and (b) three months after the last Record Date, a list, in such form as the Indenture Trustee may reasonably require, of the names and addresses of the Noteholders as of such Record Date and (ii) at such other times as the Indenture Trustee may request in writing, within 30 days after receipt by the Issuer of any such request, a list of similar form and content as of a date not more than ten days prior to the time such list is furnished; provided, however, that so long as the Indenture Trustee is the Note Registrar, no such list shall be required to be furnished. SECTION 7.02. PRESERVATION OF INFORMATION: COMMUNICATION TO NOTEHOLDERS. (a) The Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of the Noteholders contained in the most recent list furnished to the Indenture Trustee as provided in Section 7.01 and the names and addresses of Noteholders received by the Indenture Trustee in its capacity as Note Registrar and shall otherwise comply with TIA Section 312(a). The Indenture Trustee may destroy any list furnished to it as provided in such Section 7.01 upon receipt of a new list so furnished. (b) Noteholders may communicate pursuant to TIA Section 312(b) with other Noteholders with respect to their rights under this Indenture or under the Notes. 45 (c) The Issuer, the Indenture Trustee and the Note Registrar shall have the protection of TIA Section 312(c). SECTION 7.03. REPORTS BY ISSUER. (a) The Issuer shall: (i) file with the Indenture Trustee, within 15 days after the Issuer is required (if at all) to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) that the Issuer may be required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act; (ii) file with the Indenture Trustee and the Commission in accordance with rules and regulations prescribed from time to time by the Commission such additional information, documents and reports with respect to compliance by the Issuer with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; (iii) supply to the Indenture Trustee (and the Indenture Trustee shall transmit by mail to all Noteholders described in TIA Section 313(c)) such summaries of any information, documents and reports required to be filed by the Issuer pursuant to clauses (i) and (ii) of this Section 7.03(a) and by rules and regulations prescribed from time to time by the Commission. (b) Unless the Issuer otherwise determines, the fiscal year of the Issuer shall end on December 31 of each year. SECTION 7.04. REPORTS BY INDENTURE TRUSTEE. If required by TIA Section 313(a), within 60 days after each January 31st beginning with [_____], the Indenture Trustee shall mail to each Noteholder as required by TIA Section 313(c) a brief report dated as of such date that complies with TIA Section 313(a). The Indenture Trustee also shall comply with TIA Section 313(b). A copy of each report at the time of its mailing to Noteholders shall be filed by the Indenture Trustee with the Commission and each stock exchange, if any, on which the Notes are listed. The Issuer shall notify the Indenture Trustee if and when the Notes are listed on any stock exchange. ARTICLE EIGHT ACCOUNTS, DISBURSEMENTS AND RELEASES SECTION 8.01. COLLECTION OF MONEY. Except as otherwise expressly provided herein, the Indenture Trustee may demand payment or delivery of, and shall receive and collect, directly and without intervention or assistance of any fiscal agent or other intermediary, all money and other property payable to or receivable by the Indenture Trustee pursuant to this 46 Indenture and the Sale and Servicing Agreement. The Indenture Trustee shall apply all such money received by it as provided in this Indenture and the Sale and Servicing Agreement. Except as otherwise expressly provided in this Indenture, if any default occurs in the making of any payment or performance under any agreement or instrument that is part of the Collateral, the Indenture Trustee may take such action as may be appropriate to enforce such payment or performance, including the institution and prosecution of appropriate Proceedings. Any such action shall be without prejudice to any right to claim a Default or Event of Default under this Indenture and any right to proceed thereafter as provided in Article Five. SECTION 8.02. TRUST ACCOUNTS. (a) On or prior to the Closing Date, the Issuer shall cause the Servicer to establish and maintain, in the name of the Indenture Trustee, for the benefit of the Noteholders and the Certificateholders, the Trust Accounts as provided in Section 5.05 of the Sale and Servicing Agreement. (b) All Available Monies with respect to each Due Period will be deposited in the Collection Account as provided in Section 5.05 of the Sale and Servicing Agreement. On or before each Distribution Date, all amounts required to be deposited in the Note Distribution Account with respect to the preceding Due Period pursuant to Section 7.05 of the Sale and Servicing Agreement will be transferred from the Collection Account and/or the Reserve Account to the Note Distribution Account. (c) On each Distribution Date, the Indenture Trustee shall distribute all amounts on deposit in the Note Distribution Account to Noteholders in respect of the Notes to the extent of amounts due and unpaid on the Notes for principal and interest in the order and priority set forth in Section 7.05 of the Sale and Servicing Agreement. SECTION 8.03. GENERAL PROVISIONS REGARDING ACCOUNTS. (a) So long as no Default or Event of Default shall have occurred and be continuing, all or a portion of the funds in the Trust Accounts shall be invested in accordance with the provisions of Section 5.05 of the Sale and Servicing Agreement. Except as otherwise provided in Section 5.05 of the Sale and Servicing Agreement, all income or other gain from investments of moneys deposited in such Trust Accounts (other than the Reserve Fund and the Pre-Funding Account) shall be deposited by the Indenture Trustee in the Collection Account, and any loss resulting from such investments shall be charged to the related Trust Account. The Issuer will not direct the Indenture Trustee to make any investment of any funds or to sell any investment held in any of the Trust Accounts unless the security interest granted and perfected in such account will continue to be perfected in such investment or the proceeds of such sale, in either case without any further action by any Person, and, in connection with any direction to the Indenture Trustee to make any such investment or sale, if requested by the Indenture Trustee, the Issuer shall deliver to the Indenture Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to such effect. 47 (b) Subject to Section 6.01(c), the Indenture Trustee shall not in any way be held liable by reason of any insufficiency in any of the Trust Accounts resulting from any loss on any Eligible Investment included therein except for losses attributable to the Indenture Trustee's failure to make payments on such Eligible Investments issued by the Indenture Trustee, in its commercial capacity as principal obligor and not as Indenture Trustee, in accordance with their terms. (c) If (i) the Issuer shall have failed to give investment directions for any funds on deposit in the Trust Accounts to the Indenture Trustee by 11:00 a.m., New York City time (or such other time as may be agreed by the Issuer and Indenture Trustee), on any Business Day or (ii) a Default or Event of Default shall have occurred and be continuing with respect to the Notes but the Notes shall not have been declared due and payable pursuant to Section 5.02 or (iii) if such Notes shall have been declared due and payable following an Event of Default, but amounts collected or receivable from the Collateral are being applied in accordance with Section 5.05 as if there had not been such a declaration, then the Indenture Trustee shall, to the fullest extent practicable, invest and reinvest funds in the Trust Accounts in one or more Eligible Investments satisfying the requirements of clause (d) of the definition thereof. SECTION 8.04. RELEASE OF COLLATERAL. (a) Subject to the payment of its fees and expenses pursuant to Section 6.07, the Indenture Trustee may, and when required by the provisions of this Indenture or the Sale and Servicing Agreement shall, execute instruments to release property from the lien of this Indenture, or convey the Indenture Trustee's interest in the same, in a manner and under circumstances that are not inconsistent with the provisions of this Indenture. No party relying upon an instrument executed by the Indenture Trustee as provided in this Article shall be bound to ascertain the Indenture Trustee's authority, inquire into the satisfaction of any conditions precedent or see to the application of any moneys. (b) The Indenture Trustee shall, at such time as there are no Notes Outstanding and all sums due the Indenture Trustee pursuant to Section 6.07 have been paid, release any remaining portion of the Collateral that secured the Notes from the lien of this Indenture and release to the Issuer or any other Person entitled thereto any funds then on deposit in the Trust Accounts. The Indenture Trustee shall release property from the lien of this Indenture pursuant to this Section 8.04(b) only upon receipt of an Issuer Request accompanied by an Officer's Certificate, an Opinion of Counsel and (if required by the TIA as so stated in the Opinion of Counsel) Independent Certificates in accordance with TIA Sections 314(c) and 314(d)(1) meeting the applicable requirements of Section 11.01. SECTION 8.05. OPINION OF COUNSEL. The Indenture Trustee shall receive at least seven days notice when requested by the Issuer to take any action pursuant to Section 8.04(a), accompanied by copies of any instruments involved, and the Indenture Trustee shall also require, as a condition to such action, an Opinion of Counsel, in form and substance satisfactory to the Indenture Trustee, stating the legal effect of any such action, outlining the steps required to complete the same, and concluding that all conditions precedent to the taking of such action have been complied with and such action will not materially and 48 adversely impair the security for the Notes or the rights of the Noteholders in contravention of the provisions for this Indenture; provided, however, that such Opinion of Counsel shall not be required to express an opinion as to the fair value of the Collateral. Counsel rendering any such opinion may rely, without independent investigation, on the accuracy and validity of any certificate or other instrument delivered to the Indenture Trustee in connection with any such action. ARTICLE NINE SUPPLEMENTAL INDENTURES SECTION 9.01. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS. (a) Without the consent of the Holders of any Notes and with prior notice to each Rating Agency, the Issuer and the Indenture Trustee, when authorized by an Issuer Order, and the other parties hereto at any time from time to time, may enter into one or more indentures supplemental hereto (which shall conform to the provisions of the TIA as in force at the date of the execution thereof), in form satisfactory to the Indenture Trustee, for any of the following purposes: (i) to correct or amplify the description of any property at any time subject to the lien of this Indenture, or better to assure, convey and confirm unto the Indenture Trustee any property subject or required to be subjected to the lien created by this Indenture, or to subject additional property to the lien created by this Indenture; (ii) to evidence the succession, in compliance with the applicable provisions hereof, of another Person to the Issuer, and the assumption by any such successor of the covenants of the Issuer herein and in the Notes contained; (iii) to add to the covenants of the Issuer, for the benefit of the Holders of the Notes, or to surrender any right or power herein conferred upon the Issuer; (iv) to convey, transfer, assign, mortgage or pledge any property to or with the Indenture Trustee; (v) to cure any ambiguity, to correct or supplement any provision herein or in any supplemental indenture which may be inconsistent with any other provision herein, in any supplemental indenture, in the Transaction Documents or in the Prospectus or to add any other provisions with respect to matters or questions arising under this Indenture, in any supplemental indenture, in the Transaction Documents or in the Prospectus; provided that such action shall not adversely affect the interests of the Holders of the Notes; (vi) to evidence and provide for the acceptance of the appointment hereunder by a successor Indenture Trustee with respect to the Notes and to add to or 49 change any of the provisions of this Indenture as shall be necessary to facilitate the administration of the trusts hereunder by more than one Indenture Trustee, pursuant to the requirements of Article Six; and (vii) to modify, eliminate or add to the provisions of this Indenture to such extent as shall be necessary to effect the qualification of this Indenture under the TIA or under any similar federal statute hereafter enacted and to add to this Indenture such other provisions as may be expressly required by the TIA. The Indenture Trustee is hereby authorized to join in the execution of any such supplemental indenture and to make any further appropriate agreements and stipulations that may be therein contained. (b) The Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, also without the consent of any of the Holders of the Notes and with prior notice to each Rating Agency, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the Holders of the Notes under this Indenture; provided, however, that such action shall not, as evidenced by an Opinion of Counsel, adversely affect in any material respect the interests of any Noteholder. SECTION 9.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS. The Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, with the consent of the Required Holders, by Act of such Holders delivered to the Issuer and the Indenture Trustee, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the Holders of the Notes under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Note affected thereby: (i) change the date of payment of any installment of principal of or interest on any Note, or reduce the principal amount thereof, the interest rate thereon or the Redemption Date Amount with respect thereto, change the provisions of this Indenture relating to the application of collections on, or the proceeds of the sale of, the Collateral to payment of principal of or interest on the Notes, or change any place of payment where, or the coin or currency in which, any Note or the interest thereon is payable, or impair the right to institute suit for the enforcement of the provisions of this Indenture requiring the application of funds available therefor, as provided in Article Five, to the payment of any such amount due on the Notes on or after the respective due dates thereof (or, in the case of redemption, on or after the Redemption Date); (ii) reduce the percentage of the Outstanding Amount of the Notes, the consent of the Holders of which is required for any such supplemental indenture, or the consent of the Holders of which is required for any waiver of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences provided for in this Indenture; 50 (iii) modify or alter the provisions of the second proviso to the definition of the term "Outstanding"; (iv) reduce the percentage of the Outstanding Amount of the Notes required to direct the Indenture Trustee to sell or liquidate the Collateral pursuant to Section 5.04 or amend the provisions of this Article which specify the percentage of the Outstanding Amount of the Notes required to amend this Indenture or the other Transaction Documents; (v) modify any provision of this Section except to increase any percentage specified herein or to provide that certain additional provisions of this Indenture or the other Transaction Documents cannot be modified or waived without the consent of the Holder of each Outstanding Note affected thereby; or (vi) permit the creation of any lien ranking prior to or on a parity with the lien created by this Indenture with respect to any part of the Collateral or, except as otherwise permitted or contemplated herein, terminate the lien created by this Indenture on any property at any time subject hereto or deprive the Holder of any Note of the security provided by the lien created by this Indenture. The Indenture Trustee may in its discretion determine whether or not any Notes would be affected by any supplemental indenture and any such determination shall be conclusive upon the Holders of the Notes, whether theretofore or thereafter authenticated and delivered hereunder. The Indenture Trustee shall not be liable for any such determination made in good faith. It shall not be necessary for any Act of Noteholders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof. Promptly after the execution by the parties hereto of any supplemental indenture pursuant to this Section, the Indenture Trustee shall mail to the Holders of the Notes to which such amendment or supplemental indenture relates a notice setting forth in general terms the substance of such supplemental indenture. Any failure of the Indenture Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. SECTION 9.03. EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or permitting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Indenture Trustee shall be entitled to receive, and subject to Sections 6.01 and 6.02 shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Indenture Trustee may, but shall not be obligated to, enter into any such supplemental indenture that affects the Indenture Trustee's own rights, duties, liabilities or immunities under this Indenture or otherwise. SECTION 9.04. EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of any supplemental indenture pursuant to the provisions hereof, this Indenture shall be and be deemed to be modified and amended in accordance therewith with respect to the Notes 51 affected thereby, and the respective rights, limitations of rights, obligations, duties, liabilities and immunities under this Indenture of the parties hereto and the Holders of the Notes shall thereafter be determined, exercised and enforced hereunder subject in all respects to such modifications and amendments, and all the terms and conditions of any such supplemental indenture shall be and be deemed to be part of the terms and conditions of this Indenture for any and all purposes. SECTION 9.05. CONFORMITY WITH TRUST INDENTURE ACT. Every amendment of this Indenture and every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act as then in effect so long as this Indenture shall then be qualified under the Trust Indenture Act. SECTION 9.06. REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES. Notes authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and if required by the Indenture Trustee shall, bear a notation in form approved by the Indenture Trustee as to any matter provided for in such supplemental indenture. If the Issuer or the Indenture Trustee shall so determine, new notes so modified as to conform, in the opinion of the Indenture Trustee and the Issuer, to any such supplemental indenture may be prepared and executed by the Issuer and authenticated and delivered by the Indenture Trustee in exchange for Outstanding Notes. ARTICLE TEN REDEMPTION OF NOTES SECTION 10.01. REDEMPTION. (a) In the event that the Seller pursuant to Section 7.10 of the Sale and Servicing Agreement purchases the corpus of the Trust, the Notes are subject to redemption in whole, but not in part, on the Distribution Date on which such repurchase occurs, for a purchase price equal to the outstanding principal, and accrued interest on the Notes; provided, however, that the Issuer has available funds sufficient to pay such amounts. Seller, the Servicer or the Issuer shall furnish each Rating Agency notice of such redemption. If the Notes are to be redeemed pursuant to this Section 10.01(a), the Servicer or the Issuer shall furnish notice of such election to the Indenture Trustee not later than 20 days prior to the Redemption Date and the Issuer shall deposit with the Indenture Trustee in the Note Distribution Account the Redemption Price of the Notes to be redeemed whereupon all such Notes shall be due and payable on the Redemption Date upon the furnishing of a notice complying with Section 10.02 to each Holder of the Notes. (b) In the event that the assets of the Trust are sold pursuant to Section 5.03(b) of this Indenture, the proceeds of such sale shall be distributed as provided in Section 5.06. If amounts are to be paid to Noteholders pursuant to this Section 10.01(b), the Servicer or the Issuer shall, to the extent practicable, furnish notice of such event to the Indenture Trustee not later than 20 days prior to the Redemption Date whereupon all such amounts shall be payable on the Redemption Date. 52 (c) If (x) the Pre-Funded Amount has not been reduced to zero on the Distribution Date on which the Funding Period ends (or, if the Funding Period does not end on a Distribution Date, on the first Distribution Date following the end of the Funding Period) or (y) the Pre-Funded Amount has been reduced to $150,000 or less on any Distribution Date, in either case after giving effect to any reductions in the Pre-Funded Amount on such Distribution Date pursuant to Section 7.07 of the Sale and Servicing Agreement, one or more classes of Notes then outstanding will be redeemed, in whole or in part, as described in Section 7.07(c) of the Sale and Servicing Agreement, in a principal amount described therein. SECTION 10.02. FORM OF REDEMPTION NOTICE. (a) Notice of redemption under Section 10.01(a) shall be given by the Indenture Trustee by first-class mail, postage prepaid, mailed not less than five days prior to the applicable Redemption Date to each Holder of Notes, as of the close of business on the Record Date preceding the applicable Redemption Date, at such Holder's address appearing in the Note Register. All notices of redemption shall state: (i) the Redemption Date; (ii) the Redemption Date Amount; and (iii) the place where such Notes are to be surrendered for payment of the Redemption Date Amount (which shall be the office or agency of the Issuer to be maintained as provided in Section 3.02). Notice of redemption of the Notes shall be given by the Indenture Trustee in the name and at the expense of the Issuer. Failure to give notice of redemption, or any defect therein, to any Holder of any Note shall not impair or affect the validity of the redemption of any other Note. (b) Prior notice of redemption under Section 10.01(b) or 10.01(c) is not required to be given to Noteholders. SECTION 10.03. NOTES PAYABLE ON REDEMPTION DATE. The Notes or portions thereof to be redeemed shall, following notice of redemption (if any) as required by Section 10.02, on the Redemption Date become due and payable at the Redemption Date Amount and (unless the Issuer shall default in the payment of the Redemption Date Amount) no interest shall accrue on the Redemption Date Amount for any period after the date to which accrued interest is calculated for purposes of calculating the Redemption Date Amount. 53 ARTICLE ELEVEN MISCELLANEOUS SECTION 11.01. COMPLIANCE CERTIFICATES AND OPINIONS, ETC. (a) Upon any application or request by the Issuer to the Indenture Trustee to take any action under any provision of this Indenture, the Issuer shall furnish to the Indenture Trustee (i) an Officer's Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with, (ii) an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, and (iii) (if required by the TIA as so stated in the Opinion of Counsel) an Independent Certificate from a firm of certified public accountants meeting the applicable requirements of this Section and TIA Section 314(c), except that, in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture, no additional certificate or opinion need be furnished. No additional certificate or opinion need be furnished. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: (i) a statement that each signatory of such certificate or opinion has read or has caused to be read such covenant or condition and the definitions herein relating thereto; (ii) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (iii) a statement that, in the opinion of each such signatory, such signatory has made such examination or investigation as is necessary to enable such signatory to express an informed opinion as to whether or not such covenant or condition has been complied with; and (iv) a statement as to whether, in the opinion of each such signatory, such condition or covenant has been complied with. (b) (i) Prior to the deposit of any Collateral or other property or securities with the Indenture Trustee that is to be made the basis for authentication and delivery of the Notes or the release of any property subject to the lien created by this Indenture, the Issuer shall, in addition to any obligation imposed in Section 11.01(a) or elsewhere in this Indenture, furnish to the Indenture Trustee an Officer's Certificate certifying or stating the opinion of the signer thereof such certificate as to the fair value (within 90 days of such deposit) to the Issuer of the Collateral or other property or securities to be so deposited. (ii) Whenever the Issuer is required to furnish to the Indenture Trustee an Officer's Certificate certifying or stating the opinion of any signer thereof as to the matters described in clause (i) above, the Issuer shall also deliver to the Indenture Trustee an 54 Independent Certificate as to the named matters, if the fair value to the Issuer of the property to be so deposited and of all other such property made the basis of any such withdrawal or release since the commencement of the then-current fiscal year of the Issuer, as set forth in the certificates delivered pursuant to clause (i) above and this clause (ii), is 10% or more of the Outstanding Amount of the Notes, but such a certificate need not be furnished with respect to any property so deposited, if the fair value thereof to the Issuer as set forth in the related Officer's Certificate is less than $25,000 or less than one percent of the Outstanding Amount of the Notes. (iii) Other than with respect to any release described in clause (A) or (B) of Section 11.01(b)(v), whenever any property or securities are to be released from the lien created by this Indenture, the Issuer shall also furnish to the Indenture Trustee an Officer's Certificate certifying or stating the opinion of each person signing such certificate as to the fair value (within 90 days of such release) of the property or securities proposed to be released and stating that in the opinion of such person the proposed release will not impair the security created by this Indenture in contravention of the provisions hereof. (iv) Whenever the Issuer is required to furnish to the Indenture Trustee an Officer's Certificate certifying or stating the opinion of any signer thereof as to the matters described in clause (iii) above, the Issuer shall also furnish to the Indenture Trustee an Independent Certificate as to the same matters if the fair value of the property or securities and of all other property or securities (other than property described in clauses (A) or (B) of Section 11.01(b)(v)) released from the lien created by this Indenture since the commencement of the then current fiscal year, as set forth in the certificates required by clause (iii) above and this clause (iv), equals 10% or more of the Outstanding Amount of the Notes, but such certificate need not be furnished in the case of any release of property or securities if the fair value thereof as set forth in the related Officer's Certificate is less than $25,000 or less than one percent of the then Outstanding Amount of the Notes. (v) Notwithstanding any other provision of this Section, the Issuer may, without compliance with the other provisions of this Section, (A) collect, liquidate, sell or otherwise dispose of the Contracts as and to the extent permitted or required by the Transaction Documents, and (B) make cash payments out of the Trust Accounts as and to the extent permitted or required by the Transaction Documents, so long as the Issuer shall deliver to the Indenture Trustee every six months, commencing [_________], an Officer's Certificate stating that all the dispositions of Collateral described in clauses (A) or (B) that occurred during the preceding six calendar months were in the ordinary course of the Issuer's business and that the proceeds thereof were applied in accordance with the Transaction Documents. SECTION 11.02. FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE. In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Person as to other matters, and any such Person may certify or given an opinion as to such matters in one or several documents. 55 Any certificate or opinion of an Authorized Officer of the Issuer may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate of an Authorized Officer or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Servicer, the Seller or the Issuer, stating that the information with respect to such factual matters is in the possession of the Servicer, the Seller or the Issuer, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous. Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument. Whenever in this Indenture, in connection with any application or certificate or report to the Indenture Trustee, it is provided that the Issuer shall deliver any document as a condition of the granting of such application, or as evidence of the Issuer's compliance with any term hereof, it is intended that the truth and accuracy, at the time of the granting of such application or at the effective date of such certificate or report (as the case may be), of the facts and opinions stated in such document shall in such case be conditions precedent to the right of the Issuer to have such application granted or to the sufficiency of such certificate or report. The foregoing shall not, however, be construed to affect the Indenture Trustee's right to rely upon the truth and accuracy of any statement or opinion contained in any such document as provided in Article Six. SECTION 11.03. ACTS OF NOTEHOLDERS. (a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Noteholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Noteholders in person or by agents duly appointed in writing; and except as herein otherwise expressly provided such action shall become effective when such instrument or instruments are delivered to the Indenture Trustee, and, where it is hereby expressly required, to the Issuer. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Act" of the Noteholders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.01) conclusive in favor of the Indenture Trustee and the Issuer, if made in the manner provided in this Section. (b) The fact and date of the execution by any person of any such instrument or writing may be proved in any manner that the Indenture Trustee deems sufficient. (c) The ownership of Notes shall be proved by the Note Register. 56 (d) Any request, demand, authorization, direction, notice, consent, waiver or other action by the Holder of any Notes shall bind the Holder of every Note issued upon the registration thereof or in exchange therefor or in lieu thereof, in respect of anything done, omitted or suffered to be done by the Indenture Trustee or the Issuer in reliance thereon, whether or not notation of such action is made upon such Note. SECTION 11.04. NOTICES. All notices, demands, certificates, requests and communications hereunder ("notices") shall be in writing and shall be effective (a) upon receipt when sent through the U.S. mails, registered or certified mail, return receipt requested, postage prepaid, with such receipt to be effective the date of delivery indicated on the return receipt, or (b) one Business Day after delivery to an overnight courier, or (c) on the date personally delivered to an Authorized Officer of the party to which sent, or (d) on the date transmitted by legible telecopier transmission with a confirmation of receipt, in all cases addressed to the recipient at the address specified in the Sale and Servicing Agreement for such recipient. Each party hereto may, by notice given in accordance herewith to each of the other parties hereto, designate any further or different address to which subsequent notices shall be sent. SECTION 11.05. NOTICES TO NOTEHOLDERS; WAIVER. Where this Indenture provides for notice to Noteholders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class, postage prepaid to each Noteholder affected by such event, at his address as it appears on the Note Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Noteholders is given by mail, neither the failure to mail such notice nor any defect in any notice so mailed to any particular Noteholder shall affect the sufficiency of such notice with respect to other Noteholders, and any notice that is mailed in the manner herein provided shall conclusively be presumed to have been duly given. Where this Indenture provides for notice in any manner, such notice may be waived in writing by any Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Noteholders shall be filed with the Indenture Trustee but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such a waiver. In case, by reason of the suspension of regular mail service as a result of a strike, work stoppage or similar activity, it shall be impractical to mail notice of any event of Noteholders when such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a sufficient giving of such notice. Where this Indenture provides for notice to the Rating Agencies, failure to give such notice shall not affect any other rights or obligations created hereunder, and shall not under any circumstance constitute a Default or Event of Default. SECTION 11.06. ALTERNATE PAYMENT AND NOTICE PROVISIONS. Notwithstanding any provisions of this Indenture or any of the Notes to the contrary, the Issuer may enter into any 57 agreement with any Holder of a Note providing for a method of payment, or notice by the Indenture Trustee or any Paying Agent to such Holder, that is different from the methods provided for in this Indenture for such payments or notices. The Issuer will furnish to the Indenture Trustee a copy of each such agreement and the Indenture Trustee will cause payments to be made and notices to be given in accordance with such agreements. SECTION 11.07. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. SECTION 11.08. SUCCESSORS AND ASSIGNS. All covenants and agreements in this Indenture and the Notes by the Issuer shall bind its successors and assigns, whether so expressed or not. All agreements of the Indenture Trustee in this Indenture shall bind its successors, co-Indenture Trustees and agents. SECTION 11.09. SEPARABILITY. In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. SECTION 11.10. BENEFITS OF INDENTURE. Nothing in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, and the Noteholders, and any other party secured hereunder, and any other Person with an ownership interest in any part of the Collateral, any benefit or any legal or equitable right, remedy or claim under this Indenture. SECTION 11.11. LEGAL HOLIDAYS. In any case where the date on which any payment is due shall not be a Business Day, then (notwithstanding any other provision of the Notes or this Indenture) payment need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the date on which nominally due, and no interest shall accrue for the period from and after any such nominal date. SECTION 11.12. GOVERNING LAW. THIS INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS AND THE OBLIGATIONS, RIGHTS, AND REMEDIES OF THE PARTIES UNDER THE AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. SECTION 11.13. COUNTERPARTS. This Indenture may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. SECTION 11.14. RECORDING OF INDENTURE. If this Indenture is subject to recording in any appropriate public recording offices, such recording is to be effected by the Issuer and at its expense accompanied by an Opinion of Counsel (which may be counsel to the Indenture Trustee or any other counsel reasonably acceptable to the Indenture Trustee) to the effect that such recording is necessary either for the protection of the Noteholders or any other Person secured hereunder or for the enforcement of any right or remedy granted to the Indenture Trustee under this Indenture. 58 SECTION 11.15. TRUST OBLIGATION. No recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under Indenture or any certificate or other writing delivered in connection herewith or therewith, against (i) the Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficiary interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director, employee or agent of the Indenture Trustee or the Owner Trustee in its individual capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed (it being understood that the Indenture Trustee and the Owner Trustee have no such obligations in their individual capacity) and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. For all purposes of this Indenture, in the performance of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Article Six, Seven and Eight of the Trust Agreement. SECTION 11.16. NO PETITION. The parties hereto, by entering into this Indenture, and each Noteholder, by accepting a Note or a beneficial interest in a Note, hereby covenant and agree that they will not at any time institute against the Trust Depositor or the Issuer, or join in any institution against the Trust Depositor or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, this Indenture or any of the other Transaction Documents. SECTION 11.17. INSPECTION. The Issuer agrees that, on reasonable prior notice, it will permit any representative of the Indenture Trustee, during the Issuer's normal business hours, to examine all the books of account, records, reports and other papers of the Issuer, to make copies and extracts therefrom, to cause such books to be audited by independent certified public accountants, and to discuss the Issuer's affairs, finances and accounts with the Issuer's officers, employees and independent certified public accountants, all at such reasonable times and as often as may be reasonably requested, the Indenture Trustee shall and shall cause its representatives to hold in confidence all such information except to the extent disclosure may be required by law (and all reasonable applications for confidential treatment are unavailing) and except to the extent that the Indenture Trustee may reasonably determine that such disclosure is consistent with its obligations hereunder. SECTION 11.18. CONFLICT WITH TRUST INDENTURE ACT. If any provision hereof limits, qualifies or conflicts with another provision hereof that is required to be included in this Indenture by any of the provisions of the Trust Indenture Act, such required provision shall control. The provisions of TIA Sections 310 through 317 that impose duties on any person (including the provisions automatically deemed included herein unless expressly excluded by this Indenture) are a part of and govern this Indenture, whether or not physically contained herein. 59 SECTION 11.19. DISCLAIMER AND SUBORDINATION. Each Noteholder by accepting a Note acknowledges and agrees that such Note represents a debt obligation of the Trust Depositor only and does not represent an interest in any assets (other than the Trust Assets) of the Trust Depositor (including by virtue of any deficiency claim in respect of obligations not paid or otherwise satisfied from the Trust Assets and proceeds thereof). In furtherance of and not in derogation of the foregoing, each Noteholder by accepting a Note acknowledges and agrees that it shall have no right, title or interest in or to any assets (or interests therein) (other than Trust Assets) conveyed or purported to be conveyed by the Trust Depositor to another securitization trust (i.e., other than the Issuer) or other Person or Persons in connection therewith (whether by way of a sale, capital contribution or by virtue of the granting of a Lien) ("Other Assets"). To the extent that, notwithstanding the agreements and provisions contained in the preceding sentences of this Section 11.19, any Noteholder either (i) asserts an interest in or claim to, or benefit from, Other Assets, whether asserted against or through the Trust Depositor or any other Person owned by the Trust Depositor, or (ii) is deemed to have any such interest, claim or benefit in or from Other Assets, whether by operation of law, legal process, pursuant to applicable provisions of any applicable insolvency laws or otherwise (including without limitation by virtue of Section 1111(b) of the federal Bankruptcy Code or any successor provision having similar effect under the Bankruptcy Code or any successor provision having similar effect under the Bankruptcy Code), and whether deemed asserted against or through the Trust Depositor or any other Person owned by the Trust Depositor, then each Noteholder by accepting a Note further acknowledges and agrees that any such interest, claim or benefit in or from Other Assets is and shall be expressly subordinated to the indefeasible payment in full of all obligations and liabilities of the Trust Depositor which, under the terms of the relevant documents relating to the securitization of such Other Assets, are entitled to be paid from, entitled to the benefits of, or otherwise secured by such Other Assets (whether or not any such entitlement or security interest is legally perfected or otherwise entitled to a priority of distribution or application under applicable law, including any applicable insolvency laws, and whether asserted against the Trust Depositor or any other Person owned by the Depositor), including, without limitation, the payment of post-petition interest on such other obligations and liabilities. This subordination agreement shall be deemed a subordination agreement within the meaning of Section 510(a) of the Bankruptcy Code. Each Noteholder further acknowledges and agrees that no adequate remedy at law exists for a breach of this Section 11.19 and that the terms and provisions of this Section 11.19 may be enforced by an action for specific performance. [signature page follows] 60 IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed and delivered as of the day and year first above written. HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] By: [_____], not in its individual capacity but solely on behalf of the Issuer as Owner Trustee under the Trust Agreement By: ---------------------------------------------------- Printed Name: ------------------------------------------ Title: ------------------------------------------------- [_____], not in its individual capacity but solely as Indenture Trustee By: ---------------------------------------------------- Printed Name: Title: STATE OF ILLINOIS ) ) SS COUNTY OF COOK ) On ------------------------------------------------------------------- [insert date] before me, ---------------------------------------------------------------- [Insert name and title of notary] personally appeared____________________________________, personally known to me, or proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument, and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ties), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which such person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature [Seal] -------------------------------- STATE OF DELAWARE ) ) SS COUNTY OF NEW CASTLE ) On ------------------------------------------------------------------- [insert date] before me, ---------------------------------------------------------------- [Insert name and title of notary] personally appeared____________________________________, personally known to me, or proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument, and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ties), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which such person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature [Seal] -------------------------------- EXHIBIT A [RESERVED] A-1 EXHIBIT B FORM OF CLASS A-1 NOTE UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES. THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] ___% HARLEY-DAVIDSON MOTORCYCLE CONTRACT BACKED NOTES, CLASS A-1 REGISTERED $ No. R- CUSIP No. ________ Harley-Davidson Motorcycle Trust [_____], a statutory trust organized and existing under the laws of the State of Delaware (herein referred to as the "Issuer"), for value received, hereby promises to pay to [________], or registered assigns, the principal sum of ___________ ($_____) payable on the earlier of the Distribution Date occurring in [____] 20__ (the "Class A-1 Final Distribution Date") and the Redemption Date, if any, pursuant to Section 10.01 of the Indenture referred to on the reverse hereof. The Issuer will pay interest on this Note at the rate per annum shown above on each Distribution Date until the principal of this Note is paid or made available for payment, on the principal amount of this Note outstanding on the preceding Distribution Date (after giving effect to all payments of principal made on the preceding Distribution Date), subject to certain limitations contained in Section 3.01 of the Indenture. Interest on this Note will accrue for each Distribution Date from the most recent Distribution Date on which interest B-1 has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from the Closing Date. Interest will be computed on the basis of a 360-day year of twelve 30-day months. Such principal of and interest on this Note shall be paid in the manner specified on the reverse hereof. The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Issuer with respect to this Note shall be applied first to interest due and payable on this Note as provided above and then to the unpaid principal of this Note. Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note. Unless the certificate of authentication hereon has been executed by the Indenture Trustee whose name appears below by manual signature, this Note shall not be entitled to any benefit under the indenture referred to on the reverse hereof, or be valid or obligatory for any purpose. B-2 IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually or in facsimile, by an Authorized Officer, as of the date set forth below. Date: ____________ HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] By: [_____], not in its individual capacity but solely on behalf of the Issuer as Owner Trustee, under the Trust Agreement By: ---------------------------------------- Printed Name: ------------------------------ Title: ------------------------------------- B-3 INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Notes designated above and referred to in the within-mentioned Indenture. [______], not in its individual capacity but solely as Indenture Trustee By: --------------------------------- Authorized Signatory B-4 [REVERSE OF CLASS A-1 NOTE] This Note is one of a duly authorized issue of Notes of the Issuer, designated as its ___% Harley-Davidson Motorcycle Contract Backed Notes, Class A-1 (the "Class A-1 Notes"), all issued under an Indenture, dated as of [_____] (the "Indenture"), between the Issuer and [_____], as Indenture Trustee (the "Indenture Trustee"), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee and the Holders of the Notes. The Class A-1 Notes are subject to all terms of the Indenture. All terms used in this Note that are defined in the Indenture, as supplemented or amended, shall have the meanings assigned to them in or pursuant to the Indenture, as so supplemented or amended. The Class A-1 Notes and the other Classes of Notes described in the Indenture (collectively, the "Notes") are and will be equally and ratably secured by the collateral pledged as security therefor as provided in the Indenture subject to the priorities of allocations as to interest and principal payments as described in the Sale and Servicing Agreement. Principal of the Class A-1 Notes will be payable on the earlier of the Class A-1 Final Distribution Date and the Redemption Date, if any, selected pursuant to the Indenture. Notwithstanding the foregoing, the entire unpaid principal amount of the Class A-1 Notes shall be due and payable on the date following the occurrence of an Event of Default on which the maturity of the Notes shall have been accelerated in the manner provided in the Indenture. All principal payments on the Class A-1 Notes shall be made pro rata to the Class A-1 Noteholders entitled thereto. Payments of interest on this Note due and payable on each Distribution Date shall be made by wire transfer to the account of the Person whose name appears as the Registered Holder of this Note (or one or more Predecessor Notes) on the Note Register as of the close of business on each Record Date except that with respect to Notes registered on the Record Date in the name of the nominee of the Clearing Agency (initially, such nominee to be Cede & Co.), payments will be made by wire transfer in immediately available funds to the account designated by such nominee. Such checks shall be mailed to the Person entitled thereto at the address of such Person as it appears on the Note Register as of the applicable Record Date without requiring that this Note be submitted for notation of payment. Any reduction in the principal amount of this Note (or any one or more Predecessor Notes) affected by any payments made on any Distribution Date shall be binding upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not noted hereon. If funds are expected to be available, as provided in the Indenture, for payment in full of the then remaining unpaid principal amount of this Note on a Distribution Date, then the Indenture Trustee, in the name of and on behalf of the Issuer, will notify the Person who was the Registered Holder hereof as of the Record Date preceding such Distribution Date by notice mailed within five days of such Distribution Date and the amount then due and payable shall be payable only upon presentation and surrender of this Note at the Corporate Trust Office of the Indenture B-5 Trustee or at the office of the Indenture Trustee's agent appointed for such purposes located in the City of Chicago, Illinois. The Issuer shall pay interest on overdue installments of interest at the Class A-1 Rate to the extent lawful. As provided in the Indenture, the Notes may be redeemed pursuant to Section 10.01(a) of the Indenture, in whole, but not in part, at the option of the Seller, on any Distribution Date on or after the date on which the Pool Balance is less than 10% of the sum of the Pool Balance as of the Initial Cutoff Date plus the Pre-Funded Amount as of the Closing Date. As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Issuer pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee duly executed by, the Holder hereof or his attorney duly authorized in writing, with such signature guaranteed by an eligible guarantor institution which is a participant in the Securities Transfer Agent's Medallion Program (STAMP) or similar signature guarantee program, and such other documents as the Indenture Trustee may require, and thereupon one or more new program, and such other documents as the Indenture Trustee may require, and thereupon one or more new Class A-1 Notes of authorized denominations and in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the transferor may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange. Each Noteholder by acceptance of a Note or a beneficial interest in a Note covenants and agrees that no recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under the Indenture or any certificate or other writing delivered in connection therewith, against (i) the Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or employee of the Indenture Trustee or the Owner Trustee in its individual capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note covenants and agrees that by accepting the benefits of the Indenture and such Note that such Noteholder will not at any time institute against the Trust Depositor or the Issuer, or join in any institution against the Trust Depositor or the Issuer of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under any United States federal or state B-6 bankruptcy or similar law in connection with any obligations relating to the Notes, the Indenture or the Transaction Documents. The Issuer has entered into the Indenture, and this Note is issued with the intention that, for federal, state and local income, single business and franchise tax purposes, the Notes will qualify as indebtedness secured by the Collateral and that the Issuer will be disregarded as a separate entity for federal income tax purposes pursuant to Treasury Regulations Section 301.7701-3(b)(1)(ii). Each Noteholder, by acceptance of a Note or a beneficial interest in a Note, agrees to treat the Notes for federal, state and local income, single business and franchise tax purposes as indebtedness of the Issuer. Prior to the due presentment for registration of transfer of this Note, the Issuer and the Indenture Trustee and any agent of the Issuer and the Indenture Trustee may treat the Person in whose name this Note (as of the day of determination or as of such other date as may be specified in the Indenture) is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Issuer, the Indenture Trustee nor any such agent shall be affected by notice to the contrary. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Noteholders under the Indenture at any time by the Issuer and the Modified Required Holders. The Indenture also contains provisions permitting the Noteholders representing specified percentages of the Outstanding Amount of the Notes, on behalf of the Noteholders, to waive compliance by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Noteholder (or any one of more Predecessor Notes) shall be conclusive and binding upon such Holders and upon all future Noteholders and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note. The Indenture also permits the Indenture Trustee to amend or waive certain terms and conditions set forth in the Indenture without the consent of Noteholders issued thereunder. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note is deemed to represent that (i) it is not, and is not acquiring a Note or a beneficial interest in a Note on behalf of or with "plan assets" (as determined under Department of Labor Regulation Section 2510.3-101 or otherwise) of a Plan, or any employee benefit plan subject to Similar Law, or (ii) its acquisition and holding of a Note or a beneficial interest in a Note do not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code, or any Similar Law. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note is deemed to make one of the foregoing representations. The Notes are issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations therein set forth. This Note and the Indenture shall be construed in accordance with the laws of the State of Illinois, and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws. B-7 No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place, and rate, and in the coin or currency herein prescribed. B-8 EXHIBIT C FORM OF CLASS A-2 NOTE UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES. THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] ___% HARLEY-DAVIDSON MOTORCYCLE CONTRACT BACKED NOTES, CLASS A-2 REGISTERED $ No. R- CUSIP No. _________ Harley-Davidson Motorcycle Trust [_____], a statutory trust organized and existing under the laws of the State of Delaware (herein referred to as the "Issuer"), for value received, hereby promises to pay to [___________], or registered assigns, the principal sum of ___________ ($__________) payable on the earlier of the Distribution Date occurring in [_____] 20__ (the "Class A-2 Final Distribution Date") and the Redemption Date, if any, pursuant to Section 10.01 of the Indenture referred to on the reverse hereof. No payments of principal of the Class A-2 Notes shall be made until the principal on the Class A-1 Notes have been paid in full. The Issuer will pay interest on this Note at the rate per annum shown above on each Distribution Date until the principal of this Note is paid or made available for payment, on the principal amount of this Note outstanding on the preceding Distribution Date (after giving effect to all payments of principal made on the preceding Distribution Date), subject to certain limitations contained in Section 3.01 of the Indenture. Interest on this Note will C-1 accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, from the Closing Date. Interest will be computed on the basis of a 360-day year of twelve 30-day months. Such principal of and interest on this Note shall be paid in the manner specified on the reverse hereof. The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Issuer with respect to this Note shall be applied first to interest due and payable on this Note as provided above and then to the unpaid principal of this Note. Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note. Unless the certificate of authentication hereon has been executed by the Indenture Trustee whose name appears below by manual signature, this Note shall not be entitled to any benefit under the indenture referred to on the reverse hereof, or be valid or obligatory for any purpose. C-2 IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually or in facsimile, by an Authorized Officer, as of the date set forth below. Date: ___________ HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] By: [_____], not in its individual capacity but solely on behalf of the Issuer as Owner Trustee, under the Trust Agreement By: ---------------------------------------- Printed Name: ------------------------------ Title: ------------------------------------- C-3 INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Notes designated above and referred to in the within-mentioned Indenture. [_____], not in its individual capacity but solely as Indenture Trustee By: ---------------------------------------- Authorized Signatory C-4 [REVERSE OF CLASS A-2 NOTE] This Note is one of a duly authorized issue of Notes of the Issuer, designated as its ___% Harley-Davidson Motorcycle Contract Backed Notes, Class A-2 (the "Class A-2 Notes"), all issued under an Indenture, dated as of [_____] (the "Indenture"), between the Issuer and [_____], as Indenture Trustee (the "Indenture Trustee"), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee and the Holders of the Notes. The Notes are subject to all terms of the Indenture. All terms used in this Note that are defined in the Indenture, as supplemented or amended, shall have the meanings assigned to them in or pursuant to the Indenture, as so supplemented or amended. The Class A-2 Notes and the other Classes of Notes described in the Indenture (collectively, the "Notes") are and will be equally and ratably secured by the collateral pledged as security therefor as provided in the Indenture subject to the priorities of allocations as to interest and principal payments as described in the Sale and Servicing Agreement. Principal of the Class A-2 Notes will be payable on the earlier of the Class A-2 Final Distribution Date and the Redemption Date, if any, pursuant to Section 10.01(a) or 10.01(b) of the Indenture. Notwithstanding the foregoing, the entire unpaid principal amount of the Class A-2 Notes shall be due and payable on the date on which following the occurrence of an Event of Default on which the maturity of the Notes shall have been accelerated in the manner provided in the Indenture. All principal payments on the Class A-2 Notes shall be made pro rata to the Class A-2 Noteholders entitled thereto. Payments of interest on this Note due and payable on each Distribution Date shall be made by wire transfer to the account of the Person whose name appears as the Registered Holder of this Note (or one or more Predecessor Notes) on the Note Register as of the close of business on each Record Date, except that with respect to Notes registered on the Record Date in the name of nominee of the Clearing Agency (initially, such nominee to be Cede & Co.), payments will be made by wire transfer in immediately available funds to the account designated by such nominee. Such checks shall be mailed to the Person entitled thereto at the address of such Person as it appears on the Note Register as of the applicable Record Date without requiring that this Note be submitted for notation of payment. Any reduction in the principal amount of this Note (or any one or more Predecessor Notes) affected by any payments made on any Distribution Date shall be binding upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not noted hereon. If funds are expected to be available, as provided in the Indenture, for payment in full of the then remaining unpaid principal amount of this Note on a Distribution Date, then the Indenture Trustee, in the name of and on behalf of the Issuer, will notify the Person who was the Registered Holder hereof as of the Record Date preceding such Distribution Date by notice mailed within five days of such Distribution Date and the amount then due and payable shall be payable only upon presentation and surrender of this Note at the Indenture Trustee's principal Corporate Trust Office or at the office of the Indenture Trustee's agent appointed for such purposes located in the City of Chicago, Illinois. C-5 The Issuer shall pay interest on overdue installments of interest at the Class A-2 Rate to the extent lawful. As provided in the Indenture, the Notes may be redeemed pursuant to Section 10.01(a) of the Indenture, in whole, but not in part, at the option of the Seller, on any Distribution Date on or after the date on which the Pool Balance is less than 10% of the sum of the Pool Balance as of the Initial Cutoff Date plus the Pre-Funded Amount as of the Closing Date. As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Issuer pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee duly executed by, the Holder hereof or his attorney duly authorized in writing, with such signature guaranteed by an eligible guarantor institution which is a participant in the Securities Transfer Agent's Medallion Program (STAMP) or similar signature guarantee program, and such other documents as the Indenture Trustee may require, and thereupon one or more new program, and such other documents as the Indenture Trustee may require, and thereupon one or more new Class A-2 Notes of authorized denomination and in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the transferor may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note covenants and agrees that no recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under the Indenture or any certificate or other writing delivered in connection therewith, against (i) the Indenture Trustee or the Owner Trustee in their individual capacities, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or employee of the Indenture Trustee or the Owner Trustee in their individual capacities, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in their individual capacities, except as any such Person may have expressly agreed and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note covenants and agrees that by accepting the benefits of the Indenture and such Note that such Noteholder will not at any time institute against the Trust Depositor or the Issuer, or join in any institution against the Trust Depositor or the Issuer of any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under any United States federal or state C-6 bankruptcy or similar law in connection with any obligations relating to the Notes, the Indenture or the Transaction Documents. The Issuer has entered into the Indenture, and this Note is issued with the intention that, for federal, state and local income, single business and franchise tax purposes, the Notes will qualify as indebtedness secured by the Collateral and that the Issuer will be disregarded as a separate entity for federal income tax purposes pursuant to Treasury Regulations Section 301.7701-3(b)(1)(ii). Each Noteholder, by acceptance of a Note or a beneficial interest in a Note, agrees to treat the Notes for federal, state and local income, single business and franchise tax purposes as indebtedness of the Issuer. Prior to the due presentment for registration of transfer of this Note, the Issuer and the Indenture Trustee and any agent of the Issuer, the Indenture Trustee may treat the Person in whose name this Note (as of the day of determination or as of such other date as may be specified in the Indenture) is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Issuer, the Indenture Trustee nor any such agent shall be affected by notice to the contrary. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Notes under the Indenture at any time by the Issuer and the consent of the Modified Required Holders. The Indenture also contains provisions permitting the Holders of Notes representing specified percentages of the Outstanding Amount of the Notes, on behalf of the Holders of all the Notes, to waive compliance by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note (or any one of more Predecessor Notes) shall be conclusive and binding upon such Holders and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note. The Indenture also permits the Indenture Trustee to amend or waive certain terms and conditions set forth in the Indenture without the consent of Holders of the Notes issued thereunder. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note is deemed to represent that (i) it is not, and is not acquiring a Note or a beneficial interest in a Note on behalf of or with "plan assets" (as determined under Department of Labor Regulation Section 2510.3-101 or otherwise) of a Plan, or any employee benefit plan subject to Similar Law, or (ii) its acquisition and holding of a Note or a beneficial interest in a Note do not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code, or any Similar Law. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note is deemed to make one of the foregoing representations. The Notes are issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations therein set forth. C-7 This Note and the Indenture shall be construed in accordance with the laws of the State of Illinois, and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place, and rate, and in the coin or currency herein prescribed. C-8 EXHIBIT D FORM OF CLASS B NOTE UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS SECURITY IS NOT A SAVINGS ACCOUNT OR DEPOSIT AND IT IS NOT INSURED BY THE UNITED STATES OR ANY AGENCY OR FUND OF THE UNITED STATES. THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] ___% HARLEY-DAVIDSON MOTORCYCLE CONTRACT BACKED NOTES, CLASS B REGISTERED $ No. R- CUSIP No. _________ Harley-Davidson Motorcycle Trust [_____], a statutory trust organized and existing under the laws of the State of Delaware (herein referred to as the "Issuer"), for value received, hereby promises to pay to [___________], or registered assigns, the principal sum of ___________ ($__________) payable on the earlier of the Distribution Date occurring in [_____] 20__ (the "Class B Final Distribution Date") and the Redemption Date, if any, pursuant to Section 10.01 of the Indenture referred to on the reverse hereof. The Issuer will pay interest on this Note at the rate per annum shown above on each Distribution Date until the principal of this Note is paid or made available for payment, on the principal amount of this Note outstanding on the preceding Distribution Date (after giving effect to all payments of principal made on the preceding Distribution Date), subject to certain limitations contained in Section 3.01 of the Indenture. Interest on this Note will accrue for each Distribution Date from the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, if no interest has yet been paid, D-1 from the Closing Date. Interest will be computed on the basis of a 360-day year of twelve 30-day months. Such principal of and interest on this Note shall be paid in the manner specified on the reverse hereof. The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. All payments made by the Issuer with respect to this Note shall be applied first to interest due and payable on this Note as provided above and then to the unpaid principal of this Note. Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note. Unless the certificate of authentication hereon has been executed by the Indenture Trustee whose name appears below by manual signature, this Note shall not be entitled to any benefit under the indenture referred to on the reverse hereof, or be valid or obligatory for any purpose. D-2 IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed, manually or in facsimile, by an Authorized Officer, as of the date set forth below. Date: ___________ HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] By: [_____], not in its individual capacity but solely on behalf of the Issuer as Owner Trustee, under the Trust Agreement By: ---------------------------------------- Printed Name: ------------------------------ Title: ------------------------------------- D-3 INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Notes designated above and referred to in the within-mentioned Indenture. [_____], not in its individual capacity but solely as Indenture Trustee By: ---------------------------------------- Authorized Signatory D-4 [REVERSE OF CLASS B NOTE] This Note is one of a duly authorized issue of Notes of the Issuer, designated as its ___% Harley-Davidson Motorcycle Contract, Class B (the "Class B Notes"), all issued under an Indenture, dated as of [_____] (the "Indenture"), between the Issuer and [_____], as Indenture Trustee (the "Indenture Trustee"), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights and obligations thereunder of the Issuer, the Indenture Trustee and the Holders of the Notes. The Notes are subject to all terms of the Indenture. All terms used in this Note that are defined in the Indenture, as supplemented or amended, shall have the meanings assigned to them in or pursuant to the Indenture, as so supplemented or amended. The Class B Notes and the other Classes of Notes described in the Indenture (collectively, the "Notes") are and will be equally and ratably secured by the collateral pledged as security therefor as provided in the Indenture subject to the priorities of allocations as to interest and principal payments as described in the Sale and Servicing Agreement. Principal of the Class B Notes will be payable on the earlier of the Class B Final Distribution Date and the Redemption Date, if any, pursuant to Section 10.01(a) or 10.01(b) of the Indenture. Notwithstanding the foregoing, the entire unpaid principal amount of the Class B Notes shall be due and payable on the date on which following the occurrence of an Event of Default on which the maturity of the Notes shall have been accelerated in the manner provided in the Indenture. All principal payments on the Class B Notes shall be made pro rata to the Class B Noteholders entitled thereto. Payments of interest on this Note due and payable on each Distribution Date shall be made by wire transfer to the account of the Person whose name appears as the Registered Holder of this Note (or one or more Predecessor Notes) on the Note Register as of the close of business on each Record Date, except that with respect to Notes registered on the Record Date in the name of nominee of the Clearing Agency (initially, such nominee to be Cede & Co.), payments will be made by wire transfer in immediately available funds to the account designated by such nominee. Such checks shall be mailed to the Person entitled thereto at the address of such Person as it appears on the Note Register as of the applicable Record Date without requiring that this Note be submitted for notation of payment. Any reduction in the principal amount of this Note (or any one or more Predecessor Notes) affected by any payments made on any Distribution Date shall be binding upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not noted hereon. If funds are expected to be available, as provided in the Indenture, for payment in full of the then remaining unpaid principal amount of this Note on a Distribution Date, then the Indenture Trustee, in the name of and on behalf of the Issuer, will notify the Person who was the Registered Holder hereof as of the Record Date preceding such Distribution Date by notice mailed within five days of such Distribution Date and the amount then due and payable shall be payable only upon presentation and surrender of this Note at the Indenture Trustee's principal Corporate Trust Office or at the office of the Indenture Trustee's agent appointed for such purposes located in the City of Chicago, Illinois. D-5 The Issuer shall pay interest on overdue installments of interest at the Class B Rate to the extent lawful. As provided in the Indenture, the Notes may be redeemed pursuant to Section 10.01(a) of the Indenture, in whole, but not in part, at the option of the Seller, on any Distribution Date on or after the date on which the Pool Balance is less than 10% of the sum of the Pool Balance as of the Initial Cutoff Date plus the Pre-Funded Amount as of the Closing Date. As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Note Register upon surrender of this Note for registration of transfer at the office or agency designated by the Issuer pursuant to the Indenture, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Indenture Trustee duly executed by, the Holder hereof or his attorney duly authorized in writing, with such signature guaranteed by an eligible guarantor institution which is a participant in the Securities Transfer Agent's Medallion Program (STAMP) or similar signature guarantee program, and such other documents as the Indenture Trustee may require, and thereupon one or more new program, and such other documents as the Indenture Trustee may require, and thereupon one or more new Class B Notes of authorized denomination and in the same aggregate principal amount will be issued to the designated transferee or transferees. No service charge will be charged for any registration of transfer or exchange of this Note, but the transferor may be required to pay a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any such registration of transfer or exchange. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note covenants and agrees that no recourse may be taken, directly or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under the Indenture or any certificate or other writing delivered in connection therewith, against (i) the Indenture Trustee or the Owner Trustee in their individual capacities, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director or employee of the Indenture Trustee or the Owner Trustee in their individual capacities, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in their individual capacities, except as any such Person may have expressly agreed and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note covenants and agrees that by accepting the benefits of the Indenture and such Note that such Noteholder will not at any time institute against the Trust Depositor or the Issuer, or join in any institution against the Trust Depositor or the Issuer of any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under any United States federal or state D-6 bankruptcy or similar law in connection with any obligations relating to the Notes, the Indenture or the Transaction Documents. The Issuer has entered into the Indenture, and this Note is issued with the intention that, for federal, state and local income, single business and franchise tax purposes, the Notes will qualify as indebtedness secured by the Collateral and that the Issuer will be disregarded as a separate entity for federal income tax purposes pursuant to Treasury Regulations Section 301.7701-3(b)(1)(ii). Each Noteholder, by acceptance of a Note or a beneficial interest in a Note, agrees to treat the Notes for federal, state and local income, single business and franchise tax purposes as indebtedness of the Issuer. Prior to the due presentment for registration of transfer of this Note, the Issuer and the Indenture Trustee and any agent of the Issuer, the Indenture Trustee may treat the Person in whose name this Note (as of the day of determination or as of such other date as may be specified in the Indenture) is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Issuer, the Indenture Trustee nor any such agent shall be affected by notice to the contrary. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Notes under the Indenture at any time by the Issuer and the consent of the Modified Required Holders. The Indenture also contains provisions permitting the Holders of Notes representing specified percentages of the Outstanding Amount of the Notes, on behalf of the Holders of all the Notes, to waive compliance by the Issuer with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note (or any one of more Predecessor Notes) shall be conclusive and binding upon such Holders and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note. The Indenture also permits the Indenture Trustee to amend or waive certain terms and conditions set forth in the Indenture without the consent of Holders of the Notes issued thereunder. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note is deemed to represent that (i) it is not, and is not acquiring a Note or a beneficial interest in a Note on behalf of or with "plan assets" (as determined under Department of Labor Regulation Section 2510.3-101 or otherwise) of a Plan, or any employee benefit plan subject to Similar Law, or (ii) its acquisition and holding of a Note or a beneficial interest in a Note do not give rise to a nonexempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code, or any Similar Law. Each Noteholder, by acceptance of a Note or a beneficial interest in a Note is deemed to make one of the foregoing representations. The Notes are issuable only in registered form in denominations as provided in the Indenture, subject to certain limitations therein set forth. D-7 This Note and the Indenture shall be construed in accordance with the laws of the State of Illinois, and the obligations, rights and remedies of the parties hereunder and thereunder shall be determined in accordance with such laws. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Note at the times, place, and rate, and in the coin or currency herein prescribed. D-8 EXHIBIT E FORM OF ASSIGNMENT FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE ________________________________________________________________________________ (Please print or type name and address, including postal zip code, of assignee) ________________________________________________________________________________ the within Note, and all rights thereunder, hereby irrevocably constituting and appointing ________________________________________________________________________________ to transfer said Note on the books kept for registration thereof, with full power of substitution in the premises. Dated: ------------------------------------ Signature Guaranteed: - ------------------------------------------ Signature must be guaranteed by an eligible guarantor institution which is a participant in the Securities Transfer Agent's Medallion Program (STAMP) or similar signature guarantee program. - ------------------------------------------ Notice: The signature(s) on this assignment must correspond with the name(s) as it appears on the face of the within Note in every particular, without alteration or enlargement or any change whatsoever. - ------------------------------------------ (Authorized Officer) E-1 EXHIBIT F FORM OF NOTE DEPOSITORY AGREEMENT F-1 EX-5.1 4 a2158269zex-5_1.txt EXHIBIT 5.1 Exhibit 5.1 [Letterhead of Winston & Strawn LLP] May 13, 2005 Harley-Davidson Customer Funding Corp., as Trust Depositor 150 South Wacker Chicago, Illinois 60606 Re: Asset-Backed Notes Registration Statement on Form S-3 (Registration No. 333-_____) --------------------------------------------------------------- Ladies and Gentlemen: We have acted as special counsel to Harley-Davidson Customer Funding Corp. (the "COMPANY"), as depositor of the trusts (each, a "TRUST") to be created to issue asset-backed notes (the "SECURITIES"), in connection with the filing of the Registration Statement on Form S-3 (Registration No. 333-_____) (such registration statement, together with the exhibits and any amendments thereto, the "REGISTRATION STATEMENT"), registering the Securities. The Registration Statement has been filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "SECURITIES ACT"). As described in the Registration Statement, the Securities will be issued under and pursuant to the terms of one or more Sale and Servicing Agreements, Trust Agreements and Indentures (collectively, the "AGREEMENTS" and each, individually, an "AGREEMENT"). Capitalized terms used but not defined herein have the meanings given to them in the Registration Statement. This opinion letter is being delivered to you pursuant to the requirements of Item 601(b)(5) of Regulation S K under the Securities Act. We are familiar with the proceedings to date with respect to the proposed issuance and delivery of the Securities and have examined copies of the Articles of Incorporation and By-laws of the Company, the Registration Statement and the prospectus and prospectus supplements included therein, the form of each Agreement and such other documents, records and questions of law, and satisfied ourselves as to such matters of fact, as we have considered relevant and necessary as a basis for this opinion letter. In our examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified or photostatic copies and the authenticity of the originals of such latter documents. In making our examination of documents that will be executed in connection with the issuance of the Securities, we have assumed that the parties to such documents will have at the time of execution of such documents, the power, corporate or other, to enter into and perform all obligations thereunder and have also assumed the due authorization by all requisite action, corporate or other, and execution and delivery by such parties of such documents and the validity and binding effect of such documents. As to any facts material to the opinions expressed herein which we did not independently establish or verify, we have relied upon oral and written statements and representations of officers and other representatives of the Company and others. In addition, we have also relied upon the accuracy and completeness of all certificates and other statements, representations, documents, records, financial statements and papers reviewed by us, and the accuracy and completeness of all representations, warranties, schedules and exhibits contained in such documents, with respect to the factual matters set forth therein. Based on the foregoing, we are of the opinion that when (i) the Registration Statement, as finally amended, has become effective under the Securities Act, (ii) the terms, prices and interest rates of the Securities have been duly approved by the Board of Directors, (iii) the applicable Agreements relating to such Securities have been duly executed and delivered by the parties thereto in substantially the forms filed as exhibits to the Registration Statement, (iv) with respect to each Trust which will issue the Securities, the Certificate of Trust for such Trust has been duly executed and filed by the Owner Trustee with the Secretary of State of the State of Delaware, (v) the Indenture pursuant to which the Securities will be issued has been qualified under the Trust Indenture Act of 1939, as amended, (vi) the purchasers of the Securities shall have paid the purchase price therefor and the Securities have been duly executed and authenticated in accordance with the applicable Agreements pertaining to them, the Securities will be legally issued, fully paid and non-assessable and will be valid and binding obligations of the issuing Trust as issuer of such Securities enforceable in accordance with their terms, and entitled to the benefits of the applicable Agreements (subject to the effect of bankruptcy, fraudulent conveyance or transfer, insolvency, reorganization, arrangement, liquidation, conservatorship and moratorium laws and subject to the limitations imposed by other laws and judicial decisions relating to or affecting the rights of creditors generally, to general principles of equity, regardless of whether enforcement is considered in proceedings in equity or at law, and to an implied covenant of good faith and fair dealing). We do not find it necessary for the purposes of this opinion letter to cover, and accordingly we express no opinion as to, the application of the securities or blue sky laws of the various states to the offering of the Securities. This opinion letter is limited to the laws of the United States of America and the States of Illinois and New York, and we express no opinion with respect to the laws of any other state or jurisdiction. Our opinions set forth in this letter are based on the facts in existence and the laws in effect on the date hereof and we expressly disclaim any obligation to update our opinions 2 herein, regardless of whether changes in such facts or laws come to our attention after the delivery hereof. We hereby consent to the filing of this opinion letter as an Exhibit to the Registration Statement and to all references to our firm included in or made a part of the Registration Statement. In giving such consent, we do not concede that we are experts within the meaning of the Securities Act or the rules and regulations thereunder or that this consent is required by Section 7 of the Securities Act. Very truly yours, /s/ Winston & Strawn LLP 3 EX-8.1 5 a2158269zex-8_1.txt EXHIBIT 8.1 Exhibit 8.1 [Letterhead of Winston & Strawn LLP] May 13, 2005 Re: Harley-Davidson Customer Funding Corp. Registration Statement on Form S-3 (Reg. No. 333- ) ------------------------------------------------------------- Ladies and Gentlemen: We have acted as special federal tax counsel to Harley-Davidson Customer Funding Corp., a Nevada corporation (the "REGISTRANT"), in connection with the Prospectus filed by the Registrant. The term "Prospectus" means the prospectus included in the Registration Statement. The term "Registration Statement" means (1) the Registration Statement on Form S-3 including the exhibits thereto and (2) any post-effective amendment filed and declared effective prior to the date of issuance of the asset-backed securities registered thereby (the "Securities"). We have examined the question of whether the Securities will have the tax treatment described in the Prospectus. Our opinion is based upon the current provisions of the Code, Treasury Regulations promulgated thereunder, current administrative rulings, judicial decisions, and other applicable authorities, all as in effect on the date of such opinion. All of the foregoing authorities are subject to change or new interpretation, both prospectively and retroactively, and such changes or interpretation, as well as the changes in the facts as they have been represented to us or assumed by us, could affect our opinion. Our opinion does not foreclose the possibility of a contrary determination by the Internal Revenue Service (the "IRS") or by a court of competent jurisdiction, or of a contrary position by the IRS or Treasury Department in regulations or rulings issued in the future. Furthermore, our opinion assumes that all the transactions contemplated by the Prospectus will be consummated in accordance with the terms of the Prospectus. Based on the foregoing, and such legal and factual investigations as we have deemed appropriate, we are of the opinion that for federal income tax purposes: (1) the Securities, assuming they are issued in accordance with the Prospectus, will have the federal income tax treatment described in the Prospectus; and (2) we hereby adopt and confirm the information appearing under the caption "Material Federal Income Tax Consequences" in the Prospectus and confirm that it represents our opinion with respect to the matters discussed therein. We hereby consent to the filing of this letter as an exhibit to the Prospectus and to a reference to this firm (as counsel to the Registrant) under the heading "Material Federal Income Tax Consequences" and "Legal Matters" in the Prospectus, without implying or admitting that we are "experts" within the meaning of the Act or the rules and regulations of the Commission issued thereunder, with respect to any part of the Prospectus, including this exhibit. Very truly yours, /s/ WINSTON & STRAWN LLP - 2 - EX-10.1 6 a2158269zex-10_1.txt EXHIBIT 10.1 EXHIBIT 10.1 ================================================================================ TRANSFER AND SALE AGREEMENT by and between HARLEY-DAVIDSON CREDIT CORP., as Seller and HARLEY-DAVIDSON CUSTOMER FUNDING CORP., as Purchaser Dated as of [_____] ================================================================================ TABLE OF CONTENTS ARTICLE I DEFINITION................................................................................1 SECTION 1.01. GENERAL.............................................................................1 ARTICLE II TRANSFER OF CONTRACTS; ASSIGNMENT OF AGREEMENT...........................................1 SECTION 2.01. CLOSING.............................................................................1 SECTION 2.02. CONDITIONS TO THE CLOSING...........................................................2 SECTION 2.03. ASSIGNMENT OF AGREEMENT.............................................................3 SECTION 2.04. SUBSEQUENT CONTRACTS................................................................4 ARTICLE III REPRESENTATIONS AND WARRANTIES..........................................................5 SECTION 3.01. REPRESENTATIONS AND WARRANTIES REGARDING SELLER.....................................6 SECTION 3.02. REPRESENTATIONS AND WARRANTIES REGARDING EACH CONTRACT..............................7 SECTION 3.03. REPRESENTATIONS AND WARRANTIES REGARDING THE CONTRACTS IN THE AGGREGATE............10 SECTION 3.04. REPRESENTATIONS AND WARRANTIES REGARDING THE CONTRACT FILES........................12 ARTICLE IV PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS.............................12 SECTION 4.01. CUSTODY OF CONTRACTS...............................................................12 SECTION 4.02. FILING.............................................................................12 SECTION 4.03. NAME CHANGE OR RELOCATION..........................................................13 SECTION 4.04. COSTS AND EXPENSES.................................................................13 SECTION 4.05 SALE TREATMENT.....................................................................13 SECTION 4.06 SEPARATENESS FROM TRUST DEPOSITOR..................................................13 SECTION 4.07 PROTECTION OF SECURITY INTERESTS...................................................13 ARTICLE V REMEDIES UPON MISREPRESENTATION..........................................................14 SECTION 5.01. REPURCHASES OF CONTRACTS FOR BREACH OF REPRESENTATIONS AND WARRANTIES..............14 SECTION 5.02. SELLER'S REPURCHASE OPTION.........................................................14 ARTICLE VI INDEMNITIES.............................................................................15 SECTION 6.01. SELLER INDEMNIFICATION.............................................................15 SECTION 6.02. LIABILITIES TO OBLIGORS............................................................15 SECTION 6.03. TAX INDEMNIFICATION................................................................15 SECTION 6.04. OPERATION OF INDEMNITIES...........................................................15 ARTICLE VII MISCELLANEOUS..........................................................................16 SECTION 7.01. PROHIBITED TRANSACTIONS WITH RESPECT TO THE TRUST..................................16 SECTION 7.02. MERGER OR CONSOLIDATION............................................................16 SECTION 7.03. TERMINATION........................................................................16 SECTION 7.04. ASSIGNMENT OR DELEGATION BY SELLER.................................................16 SECTION 7.05. AMENDMENT..........................................................................17 SECTION 7.06. NOTICES............................................................................17 SECTION 7.07. MERGER AND INTEGRATION.............................................................18 SECTION 7.08. HEADINGS...........................................................................18 SECTION 7.09. GOVERNING LAW......................................................................18

- i - EXHIBITS ~~Exhibit A Form of Assignment Exhibit B Form of Officer's Certificate Exhibit C Form of Subsequent Purchase Agreement~~

- ii - THIS AGREEMENT, dated as of [_____], is made by and between Harley-Davidson Credit Corp., a Nevada corporation, as seller hereunder (together with its successors and assigns "HARLEY-DAVIDSON CREDIT" or "SELLER"), and Harley-Davidson Customer Funding Corp., a Nevada corporation and wholly-owned subsidiary of Seller (together with its successors and assigns "TRUST DEPOSITOR"), as purchaser hereunder. WHEREAS, in the regular course of its business, Seller purchases and services (i) motorcycle conditional sales contracts from Harley-Davidson motorcycle retailers and (ii) motorcycle promissory note and security agreements from Eaglemark Savings Bank, each of which contracts provides for installment payment obligations by or on behalf of the retailer's customer/purchaser and grants a security interest in the related motorcycle in order to secure such obligations; WHEREAS, Seller and Trust Depositor wish to set forth the terms and conditions pursuant to which Trust Depositor will acquire from time to time the "CONTRACT ASSETS," as hereinafter defined; and WHEREAS, Trust Depositor intends concurrently with its purchases from time to time of Contract Assets hereunder to convey all right, title and interest in such Contract Assets to Harley-Davidson Motorcycle Trust [_____] (the "TRUST") pursuant to the Sale and Servicing Agreement dated as of [_____] by and among Trust Depositor, Harley-Davidson Credit, as Servicer, the Trust, as issuer (the "ISSUER") and [_____], as Indenture Trustee (as amended, supplemented or otherwise modified from time to time, the "SALE AND SERVICING AGREEMENT"), executed concurrently herewith; NOW, THEREFORE, in consideration of the premises and the mutual agreements hereinafter set forth, Seller and Trust Depositor agree as follows: ARTICLE I DEFINITIONS SECTION 1.01. GENERAL. Unless otherwise defined in this Agreement, capitalized terms used herein (including in the preamble above) shall have the meanings assigned to them in the Sale and Servicing Agreement. ARTICLE II TRANSFER OF CONTRACTS; ASSIGNMENT OF AGREEMENT SECTION 2.01. CLOSING. Subject to and upon the terms and conditions set forth in this Agreement, Seller hereby sells, transfers, assigns, sets over and otherwise conveys to Trust Depositor, in consideration of Trust Depositor's payment of $[_____] in cash as the purchase price therefor, (i) all the right, title and interest of Seller in and to the Initial Contracts listed on the initial List of Contracts in effect on the Closing Date (including, without limitation, all security interests and all rights to receive payments which are collected pursuant thereto after the Initial Cutoff Date, including any liquidation proceeds therefrom, but excluding any rights to receive payments which were collected pursuant thereto on or prior to the Initial Cutoff Date), (ii) all rights of Seller under any physical damage or other individual insurance policy (including a "FORCED PLACED" policy, if any), any debt insurance policy or any debt cancellation agreement relating to any such Contract, an Obligor or a Motorcycle securing such Contract, (iii) all security interests in each such Motorcycle, (iv) all documents contained in the related Contract Files, (v) all rights of Seller in the Lockbox, Lockbox Account and related Lockbox Agreement to the extent they relate to the Contracts, (vi) all rights (but not the obligations) of the Seller under any motorcycle dealer agreements between the dealers (i.e. originators of certain Contracts) and the Seller, (vii) all rights of Seller to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Contracts and (viii) all proceeds and products of the foregoing (items (i) - (viii), together with the additional assets referred to in Section 2.04 below which may be transferred from time to time in respect of Subsequent Contracts, being collectively referred to herein as the "CONTRACT ASSETS"). Although Seller and Trust Depositor agree that any such transfer is intended to be a sale of ownership in the Contract Assets, rather than the mere granting of a security interest to secure a borrowing, in the event such transfer is deemed to be of a mere security interest to secure indebtedness, Seller shall be deemed to have granted Trust Depositor a perfected first priority security interest in such Contract Assets and this Agreement shall constitute a security agreement under applicable law. If such transfer is deemed to be the mere granting of a security interest to secure a borrowing, Trust Depositor may, to secure Trust Depositor's own borrowing under the Sale and Servicing Agreement (to the extent that the transfer of the Contract Assets thereunder is deemed to be a mere granting of a security interest to secure a borrowing) repledge and reassign (i) all or a portion of the Contract Assets pledged to Trust Depositor and not released from the security interest of this Agreement at the time of such pledge and assignment, and (ii) all proceeds thereof. Such repledge and reassignment may be made by Trust Depositor with or without a repledge and reassignment by Trust Depositor of its rights under this Agreement, and without further notice to or acknowledgment from Seller. Seller waives, to the extent permitted by applicable law, all claims, causes of action and remedies, whether legal or equitable (including any right of setoff), against Trust Depositor or any assignee of Trust Depositor relating to such action by Trust Depositor in connection with the transactions contemplated by the Sale and Servicing Agreement. SECTION 2.02. CONDITIONS TO THE CLOSING. On or before the Closing Date, Seller shall deliver or cause to be delivered to Trust Depositor each of the documents, certificates and other items as follows: (a) The initial List of Contracts, certified by the Chairman of the Board, President or any Vice President of Seller together with an Assignment substantially in the form attached as EXHIBIT A hereto. - 2 - (b) A certificate of an officer of Seller substantially in the form of EXHIBIT B hereto. (c) An opinion of counsel for Seller substantially in the form of EXHIBIT D to the Sale and Servicing Agreement. (d) A letter or letters from [_____], or another nationally recognized accounting firm, addressed to Trust Depositor and the Issuer and the Trustees and stating that such firm has reviewed a sample of the Initial Contracts and performed specific procedures for such sample with respect to certain contract terms and identifying those Initial Contracts which do not so conform. (e) Copies of resolutions of the Board of Directors of Seller or of the Executive Committee of the Board of Directors of Seller approving the execution, delivery and performance of this Agreement and the transactions contemplated hereunder, certified in each case by the Secretary or an Assistant Secretary of Seller. (f) Officially certified recent evidence of due incorporation and good standing of Seller under the laws of Nevada. (g) Evidence of proper filing with the appropriate office in Nevada of a UCC financing statement naming Seller as debtor, naming Trust Depositor as assignor secured party and the Issuer as secured party, and listing the Contract Assets as collateral as well as evidence of proper filing with the appropriate office in Delaware of a UCC financing statement naming the Issuer as debtor, naming the Indenture Trustee, as secured party, and listing the Contract Assets as collateral. (h) An Officer's Certificate from Seller certifying that the Seller, on or prior to the Closing Date, has indicated in its computer files, in accordance with its customary standards, policies and procedures, that the Contracts have been conveyed to the Trust Depositor pursuant to this Agreement. (i) The documents, certificates and other items described in Section 2.02 of the Sale and Servicing Agreement, to the extent not already described above. SECTION 2.03. ASSIGNMENT OF AGREEMENT. Trust Depositor has the right to assign its interest under this Agreement to the Issuer as may be required to effect the purposes of the Sale and Servicing Agreement, without further notice to, or consent of, Seller, and the Issuer shall succeed to such of the rights of Trust Depositor hereunder as shall be so assigned. Seller acknowledges that, pursuant to the Sale and Servicing Agreement, Trust Depositor will assign all of its right, title and interest in and to the Contract Assets and its right to exercise the remedies created by Section 5.01 hereof for breaches of representations and warranties of Seller contained in Sections 3.01, 3.02, 3.03 and 3.04 hereof to the Issuer and the Indenture Trustee for the benefit of the Noteholders. Seller agrees that, upon such assignment to the Issuer and the Indenture Trustee, such representations will run to and be for the benefit of the Issuer and the Indenture - 3 - Trustee and the Issuer and the Indenture Trustee may enforce directly without joinder of Trust Depositor, the obligations of Seller set forth herein. SECTION 2.04. SUBSEQUENT CONTRACTS. (a) Subject to and upon the terms and conditions set forth in paragraph (b) below and in the related Subsequent Purchase Agreement, Seller hereby agrees to sell, transfer, assign, set over and otherwise convey to Trust Depositor, in consideration of Trust Depositor's payment on the related Subsequent Transfer Date of the purchase price therefor (as set forth in the related Subsequent Purchase Agreement), and Trust Depositor hereby agrees to purchase, (i) all the right, title and interest of Seller in and to the Subsequent Contracts listed on the related Subsequent List of Contracts (including, without limitation, all security interests and all rights to receive payments which are collected pursuant thereto after the applicable Subsequent Cutoff Date, including any liquidation proceeds therefrom, but excluding any rights to receive payments which were collected pursuant thereto on or prior to such Subsequent Cutoff Date), (ii) all rights of Seller under any physical damage or other individual insurance policy (including a "FORCED PLACED" policy, if any), any debt insurance policy or any debt cancellation agreement relating to any such Subsequent Contract , an Obligor or a Motorcycle securing such Subsequent Contract, (iii) all security interests in each such Motorcycle, (iv) all documents contained in the related Contract Files, (v) all rights of Seller in the Lockbox, Lockbox Account and related Lockbox Agreement to the extent they relate to the Subsequent Contracts, (vi) all rights (but not the obligations) of the Seller under any motorcycle dealer agreements between the dealers (I.E. originators of certain Subsequent Contracts) and the Seller, (vii) all rights of Seller to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Subsequent Contracts and (viii) all proceeds and products of the foregoing (items (i) - (viii), upon consummation of any above-described purchase, becoming part of the "CONTRACT ASSETS"). Seller agrees, subject to the terms and conditions herein applicable to transfers of Subsequent Contracts, to sell an aggregate Principal Balance of Subsequent Contracts at or prior to the end of the Funding Period equal to the Pre-Funded Amount on the Closing Date. (b) Seller shall transfer to Trust Depositor, and Trust Depositor shall purchase, the Subsequent Contracts and related assets to be transferred on any Subsequent Transfer Date only upon the satisfaction of each of the following conditions on or prior to the Subsequent Transfer Date: (i) The Seller shall have provided the Trustees, the Underwriters and the Rating Agencies with a timely Addition Notice and shall have provided any information reasonably requested by any of the foregoing with respect to the Subsequent Contracts; (ii) the Funding Period shall not have terminated; (iii) the Seller shall have delivered to the Trust Depositor a duly executed Purchase Agreement in substantially the form of EXHIBIT C hereto (the "SUBSEQUENT PURCHASE AGREEMENT"), which shall include a Subsequent List of Contracts listing the Subsequent Contracts being purchased; - 4 - (iv) as of each Subsequent Transfer Date, neither the Seller nor the Trust Depositor was insolvent nor will either of them have been made insolvent by such transfer nor is either of them aware of any pending insolvency; (v) each Rating Agency shall have notified the Trust Depositor and the Trustees that following such transfer, and the transfer immediately thereafter of the Subsequent Contracts to the Trust, the Class A-1 Notes and the Class A-2 Notes will be rated in the highest rating category by such Rating Agency and the Class B Notes will be rated at least "[__]" by Standard & Poor's and "[__]" by Moody's; (vi) such addition will not result in a material adverse tax consequence to the Issuer or the Noteholders as evidenced by an Opinion of Counsel to be delivered by the Seller to the Issuer, the Trustees, and the Underwriters; (vii) the Seller shall have delivered to the Rating Agencies and to the Underwriters one or more opinions of counsel (or bring-downs of opinions of counsel delivered on the Closing Date) with respect to the transfer of the Subsequent Contracts substantially in the form of the opinions of counsel delivered to such Persons on the Closing Date; (viii) the Seller shall have taken any action necessary to maintain the first perfected ownership interest of the Trust in the Trust Corpus and the first perfected security interest of the Trust Depositor in the Contract Assets, the Trust in the Trust Corpus and the Indenture Trustee in the Reserve Fund Deposits; and (ix) no selection procedures believed by the Seller to be adverse to the interests of the Noteholders shall have been utilized in selecting the Subsequent Contracts. (c) Seller agrees to pay all reasonable out-of-pocket expenses in connection with any request for the conveyance of Subsequent Contracts, whether or not such conveyance is actually consummated. ARTICLE III REPRESENTATIONS AND WARRANTIES Seller makes the following representations and warranties, on which Trust Depositor will rely in purchasing the initial Contract Assets on the Closing Date (and any Subsequent Contracts on the related Subsequent Transfer Date) and concurrently reconveying the same to the Trust, and on which the Trust, the Indenture Trustee and the Noteholders will rely under the Sale and Servicing Agreement. Such representations speak as of the execution and delivery of this Agreement and as of the Closing Date in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date in the case of Subsequent Contracts, but shall survive the sale, transfer and assignment of the Contracts to the Trust and the pledge of the Contracts to the Indenture Trustee. The repurchase obligation of Seller set forth in Section 5.01 below and in Section 7.08 - 5 - of the Sale and Servicing Agreement constitutes the sole remedy available for a breach of a representation or warranty of Seller set forth in Section 3.02, 3.03 or 3.04 of this Agreement. SECTION 3.01. REPRESENTATIONS AND WARRANTIES REGARDING SELLER. Seller represents and warrants, as of the execution and delivery of this Agreement and as of the Closing Date, in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date, in the case of Subsequent Contracts, that: (a) ORGANIZATION AND GOOD STANDING. Seller is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has the corporate power to own its assets and to transact the business in which it is currently engaged. Seller is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the character of the business transacted by it or properties owned or leased by it requires such qualification and in which the failure so to qualify would have a material adverse effect on the business, properties, assets, or condition (financial or otherwise) of Seller or Trust Depositor. Seller is properly licensed in each jurisdiction to the extent required by the laws of such jurisdiction to service the Contracts in accordance with the terms of the Sale and Servicing Agreement. (b) AUTHORIZATION; BINDING OBLIGATION. Seller has the power and authority to make, execute, deliver and perform this Agreement and the other Transaction Documents to which the Seller is a party and all of the transactions contemplated under this Agreement and the other Transaction Documents to which the Seller is a party, and has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the other Transaction Documents to which the Seller is a party. This Agreement and the other Transaction Documents to which the Seller is a party constitute the legal, valid and binding obligation of Seller enforceable in accordance with their terms, except as enforcement of such terms may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights generally and by the availability of equitable remedies. (c) NO CONSENT REQUIRED. Seller is not required to obtain the consent of any other party or any consent, license, approval or authorization from, or registration or declaration with, any governmental authority, bureau or agency in connection with the execution, delivery, performance, validity or enforceability of this Agreement and the other Transaction Documents to which the Seller is a party. (d) NO VIOLATIONS. Seller's execution, delivery and performance of this Agreement and the other Transaction Documents to which the Seller is a party will not violate any provision of any existing law or regulation or any order or decree of any court or the Articles of Incorporation or Bylaws of Seller, or constitute a material breach of any mortgage, indenture, contract or other agreement to which Seller is a party or by which Seller or any of Seller's properties may be bound. - 6 - (e) LITIGATION. No litigation or administrative proceeding of or before any court, tribunal or governmental body is currently pending, or to the knowledge of Seller threatened, against Seller or any of its properties or with respect to this Agreement or any other Transaction Document to which the Seller is a party which, if adversely determined, would in the opinion of Seller have a material adverse effect on the business, properties, assets or condition (financial or other) of Seller or the transactions contemplated by this Agreement or any other Transaction Document to which the Seller is a party. (f) STATE OF INCORPORATION; NAME; NO CHANGES. Seller's state of incorporation is the State of Nevada. Seller's exact legal name is as set forth in the first paragraph of this Agreement. Seller has not changed its name whether by amendment of its Articles of Incorporation, by reorganization or otherwise, and has not changed its state of incorporation, within the four months preceding the Closing Date. (g) OPERATIONS. Approximately [_____]% of the aggregate principal balance of contracts financed from time to time by the Seller are secured by motorcycles manufactured by Buell. (h) SOLVENCY. The Seller, after giving effect to the conveyances made by it hereunder, is Solvent. SECTION 3.02. REPRESENTATIONS AND WARRANTIES REGARDING EACH CONTRACT. Seller represents and warrants as to each Contract as of the execution and delivery of this Agreement and as of the Closing Date, in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date, in the case of Subsequent Contracts, that: (a) LIST OF CONTRACTS. The information set forth in the List of Contracts (or Subsequent List of Contracts, in the case of Subsequent Contracts) is true, complete and correct in all material respects as of the Initial Cutoff Date or applicable Subsequent Cutoff Date, as the case may be. (b) PAYMENTS. As of the Initial Cutoff Date or applicable Subsequent Cutoff Date, as the case may be, the most recent scheduled payment with respect to any Contract either had been made or was not delinquent for more than 30 days. To the best of Seller's knowledge, all payments made on each Contract were made by the respective Obligor or under a debt insurance policy or debt cancellation agreement. (c) NO WAIVERS. As of the Closing Date (or the applicable Subsequent Transfer Date, in the case of Subsequent Contracts), the terms of the Contracts have not been waived, altered or modified in any respect, except by instruments or documents included in the related Contract File. (d) BINDING OBLIGATION. Each Contract is a legal, valid and binding payment obligation of the Obligor thereunder and is enforceable in accordance with its terms, - 7 - except as such enforceability may be limited by insolvency, bankruptcy, moratorium, reorganization, or other similar laws affecting the enforcement of creditors' rights generally. (e) NO DEFENSES. No Contract is subject to any right of rescission, setoff, counterclaim or defense, including the defense of usury, and the operation of any of the terms of such Contract or the exercise of any right thereunder will not render the Contract unenforceable in whole or in part or subject to any right of rescission, setoff, counterclaim or defense, including the defense of usury, and no such right of rescission, setoff, counterclaim or defense has been asserted with respect thereto. (f) INSURANCE. The Seller, in accordance with its policies and procedures, has determined that, as of the date of origination of each Contract, the related Obligor had obtained or agreed to obtain physical damage insurance covering the Motorcycle. The terms of each Contract require that for the term of such Contract the Motorcycle securing such Contract will be covered by physical damage insurance. (g) ORIGINATION. Each Contract (i) was originated by a Harley-Davidson motorcycle dealer or by Eaglemark Savings Bank, in each case, in the regular course of its business, (ii) was fully and properly executed by the parties thereto, and (iii) has been purchased by Seller in the regular course of its business. Each Contract was sold by such motorcycle dealer or Eaglemark Savings Bank, as the case may be, to the Seller without any fraud or misrepresentation on the part of such motorcycle dealer or Eaglemark Savings Bank. (h) LAWFUL ASSIGNMENT. No Contract was originated in or is subject to the laws of any jurisdiction whose laws would make the sale, transfer and assignment of the Contract under this Agreement or under the Sale and Servicing Agreement or the pledge of the Contract under the Indenture unlawful, void or voidable. (i) COMPLIANCE WITH LAW. None of the Contracts, the origination of the Contracts by Harley-Davidson motorcycle dealers or Eaglemark Savings Bank, the purchase of the Contracts by the Seller, the sale of the Contracts by the Seller to the Trust Depositor or by the Trust Depositor to the Trust, or any combination of the foregoing, violated at the time of origination or as of the Closing Date or as of any Subsequent Transfer Date, as applicable, any requirement of any federal, state or local law and regulations thereunder, including, without limitation, usury, truth in lending, motor vehicle installment loan and equal credit opportunity laws, applicable to the Contracts and the sale of Motorcycles. (j) CONTRACT IN FORCE. As of the Closing Date (or the applicable Subsequent Transfer Date in the case of Subsequent Contracts), no Contract has been satisfied or subordinated in whole or in part or rescinded, and the related Motorcycle securing any Contract has not been released from the lien of the Contract in whole or in part. - 8 - (k) VALID SECURITY INTEREST. Each Contract creates a valid, subsisting and enforceable first priority perfected security interest in favor of Seller or Eaglemark Savings Bank (as the case may be) in the Motorcycle covered thereby, and such security interest has been assigned by Eaglemark Savings Bank to Seller (where applicable) and by Seller to the Trust Depositor. Eaglemark Savings Bank's security interest has been validly assigned by Eaglemark Savings Bank to Seller. Seller's security interest has been validly assigned by the Seller to the Trust Depositor pursuant to this Agreement and by the Trust Depositor to the Issuer pursuant to the Sale and Servicing Agreement. Immediately prior to the transfer, assignment and conveyance thereof, each Contract is secured by a first priority, validly perfected security interest in the Motorcycle covered thereby in favor of the Seller or Eaglemark Savings Bank as secured party or all necessary and appropriate actions have been commenced that would result in a first priority, validly perfected security interest in the Motorcycle covered thereby in favor of the Seller or Eaglemark Savings Bank as secured party, except, in each case, as to priority for any lien for taxes, labor, materials or of any state law enforcement agency affecting a Motorcycle. (l) GOOD TITLE. Each Contract was purchased by Seller for value and taken into possession prior to the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts) in the ordinary course of its business, without knowledge that the Contract was subject to a security interest. No Contract has been sold, assigned or pledged to any person other than Trust Depositor and the Issuer as the transferee of Trust Depositor, and prior to the transfer of the Contract to Trust Depositor, Seller had good and marketable title to each Contract free and clear of any encumbrance, equity, loan, pledge, charge, claim or security interest and was the sole owner thereof and had full right to transfer the Contract to Trust Depositor, and, immediately upon the transfer of each Contract by the Seller, the Trust Depositor shall have good and marketable title to each Contract free and clear of any encumbrance, equity, loan, pledge, charge, claim or security interest, and, immediately upon the transfer of each Contract by the Trust Depositor, the Issuer shall have good and marketable title to each Contract free and clear of any encumbrance, equity, loan, pledge, charge, claim or security interest. (m) NO DEFAULTS. As of the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts), no default, breach, violation or event permitting acceleration existed with respect to any Contract and no event had occurred which, with notice and the expiration of any grace or cure period, would constitute such a default, breach, violation or event permitting acceleration under such Contract. Seller has not waived any such default, breach, violation or event permitting acceleration, and Seller has not granted any extension of payment terms on any Contract. As of the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts), no Motorcycle had been repossessed. (n) NO LIENS. As of the Closing Date (or the applicable Subsequent Transfer Date in the case of Subsequent Contracts) there are, to the best of Seller's knowledge, no liens or claims which have been filed for work, labor or materials affecting the - 9 - Motorcycle securing any Contract which are liens prior to, or equal with, the lien of such Contract. (o) INSTALLMENTS. Each Contract has a fixed Contract Rate and provides for monthly payments of principal and interest which, if timely made, would fully amortize the loan on a simple-interest basis over its term. (p) ENFORCEABILITY. Each Contract contains customary and enforceable provisions such as to render the rights and remedies of the holder thereof adequate for the realization against the collateral of the benefits of the security. (q) ONE ORIGINAL. Each Contract is evidenced by only one original executed Contract, which original has been delivered to the Issuer or its designee on or before the Closing Date (or the applicable Subsequent Transfer Date in the case of Subsequent Contracts). (r) NO GOVERNMENT OBLIGORS. No Obligor is the United States government or an agency, authority, instrumentality or other political subdivision of the United States government. (s) LOCKBOX BANK. The Lockbox Bank is the only institution holding any Lockbox Account for receipt of payments from Obligors, and all Obligors have been instructed to make payments to the Lockbox Account (either directly by remitting payments to the Lockbox, or indirectly by making payments through direct debit, the telephone or the internet to an account of the Servicer which payments will be subsequently transferred from such account to one or more Lockbox Banks), and no person claiming through or under Seller has any claim or interest in the Lockbox Account other than the Lockbox Bank; provided, however, that other "Trusts" (as defined in the Lockbox Agreement) shall have an interest in certain other collections therein not related to the Contracts. (t) OBLIGOR BANKRUPTCY. At the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts), no Obligor was subject to a bankruptcy proceeding (according to the records of the Seller) within the one year preceding such Cutoff Date. (u) CHATTEL PAPER. The Contracts constitute tangible chattel paper within the meaning of the UCC. (v) CONTRACT NOT ASSUMABLE. No Contract is assumable by another Person in a manner which would release the Obligor thereof from such Obligor's obligations to the Trust Depositor with respect to such Contract. SECTION 3.03. REPRESENTATIONS AND WARRANTIES REGARDING THE CONTRACTS IN THE AGGREGATE. Seller represents and warrants, as of the execution and delivery of this Agreement - 10 - and as of the Closing Date, in the case of the Initial Contracts, and, if applicable, as of the applicable Subsequent Transfer Date, in the case of Subsequent Contracts, that: (a) AMOUNTS. The sum of the aggregate Principal Balances payable by Obligors under the Contracts as of the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts), plus the Pre-Funded Amount as of such date, equals or exceeds the sum of the principal balance of the Class A-1 Notes, the Class A-2 Notes and the Class B Notes on the Closing Date or the related Subsequent Transfer Date, as applicable. (b) CHARACTERISTICS. The Initial Contracts have the following characteristics: (i) all the Contracts are secured by Motorcycles; (ii) no Initial Contract has a remaining maturity of more than [_____] months; and (iii) the final scheduled payment on the Initial Contract with the latest maturity is due no later than [_____]. Approximately [_____]% of the Principal Balance of the Initial Contracts as of the Initial Cutoff Date is attributable to loans for purchases of new Motorcycles and approximately [_____]% is attributable to loans for purchases of used Motorcycles. No Initial Contract was originated after the Initial Cutoff Date. No Initial Contract has a Contract Rate less than [_____]%. The last scheduled payment date of the Contracts (including any Subsequent Contracts) is due no later than [_____]. Approximately [_____]% of the Principal Balance of the Initial Contracts as of the Initial Cutoff Date is attributable to loans for purchases of Motorcycles manufactured by Harley-Davidson or Buell and approximately [_____]% of the Principal Balance of the Initial Contracts as of the Initial Cutoff Date is attributable to loans for purchases of Motorcycles not manufactured by Harley-Davidson or Buell. (c) MARKING RECORDS. As of the Closing Date (or the applicable Subsequent Transfer Date in the case of Subsequent Contracts), Seller has caused the Computer File relating to the Contracts sold hereunder and concurrently reconveyed by Trust Depositor to the Trust and pledged by the Trust to the Indenture Trustee to be clearly and unambiguously marked to indicate that such Contracts constitute part of the Trust, are owned by the Trust and constitute security for the Notes. (d) NO ADVERSE SELECTION. No selection procedures adverse to Noteholders have been employed in selecting the Contracts. (e) TRUE SALE. The transactions contemplated by this Agreement and the Sale and Servicing Agreement constitute valid sales, transfers and assignments from Seller to Trust Depositor and from Trust Depositor to the Trust of all of Seller's right, title and interest in the Contract Assets as of the Closing Date and any Subsequent Transfer Date, as applicable. (f) ALL FILINGS MADE. All filings (including, without limitation, UCC filings) required to be made by any Person and actions required to be taken or performed by any Person in any jurisdiction to give the Indenture Trustee a first priority perfected lien on, - 11 - or ownership interest in, the Contracts and the proceeds thereof and the rest of the Trust Corpus have been made, taken or performed. (g) DELTA LOANS. No more than [_____]% of the Principal Balance of the Contracts as of the end of the Funding Period is attributable to Delta Loans. SECTION 3.04. REPRESENTATIONS AND WARRANTIES REGARDING THE CONTRACT FILES. Seller represents and warrants as of the execution and delivery of this Agreement and as of the Closing Date, in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date, in the case of Subsequent Contracts, that: (a) POSSESSION. Immediately prior to the Closing Date or any Subsequent Transfer Date, the Servicer, or its custodian, will have possession of each original Contract and the related complete Contract File. Each of such documents which is required to be signed by the Obligor has been signed by the Obligor in the appropriate spaces. All blanks on any form have been properly filled in and each form has otherwise been correctly prepared. The complete Contract File for each Contract currently is in the possession of the Servicer or its custodian. (b) BULK TRANSFER LAWS. The transfer, assignment and conveyance of the Contracts and the Contract Files by Seller pursuant to this Agreement or any Subsequent Purchase Agreement and by Trust Depositor pursuant to the Sale and Servicing Agreement is not subject to the bulk transfer or any similar statutory provisions in effect in any applicable jurisdiction. ARTICLE IV PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS SECTION 4.01. CUSTODY OF CONTRACTS. The contents of each Contract File shall be held by the Servicer, or its custodian, for the benefit of the Trust as the owner thereof in accordance with the Sale and Servicing Agreement. SECTION 4.02. FILING. On or prior to the Closing Date and each Subsequent Transfer Date, Seller shall cause the UCC financing statement(s) referred to in Section 2.02(g) hereof and in Section 2.02(g) of the Sale and Servicing Agreement to be filed and from time to time Seller shall take and cause to be taken such actions and execute such documents as are necessary or desirable or as Trust Depositor or the Trust may reasonably request to perfect and protect the Trust Depositor's and the Trust's ownership interest in the Contract Assets against all other persons, including, without limitation, the filing of financing statements, amendments thereto and continuation statements, the execution of transfer instruments and the making of notations on or taking possession of all records or documents of title. The Seller authorizes the Trust Depositor to file financing statements describing the Contract Assets as collateral. All financing statements filed or to be filed against the Seller in favor of the Trust Depositor or the Trust in connection herewith describing the Contract Assets as collateral shall contain a statement to the - 12 - following effect: "A purchase of or security interest in any collateral described in this financing statement, except as permitted in the Transfer and Sale Agreement or Sale and Servicing Agreement, will violate the rights of the Secured Party." SECTION 4.03. NAME CHANGE OR RELOCATION. (a) During the term of this Agreement, Seller shall not change its name, identity or structure or state of incorporation without first giving at least 30 days' prior written notice to Trust Depositor and to the Trustees. (b) If any change in Seller's name, identity or structure or other action would make any financing or continuation statement or notice of ownership interest or lien filed under this Agreement seriously misleading within the meaning of applicable provisions of the UCC or any title statute, Seller, no later than five days after the effective date of such change, shall file such amendments as may be required to preserve and protect the Trust Depositor's and the Trust's interests in the Contract Assets and proceeds thereof. In addition, Seller shall not change its state of incorporation unless it has first taken such action as is advisable or necessary to preserve and protect the Trust Depositor's and the Trusts' interest in the Contract Assets. Promptly after taking any of the foregoing actions, Seller shall deliver to Trust Depositor and the Trustees an opinion of counsel stating that, in the opinion of such counsel, all financing statements or amendments necessary to preserve and protect the interests of the Trust Depositor and the Trust in the Contract Assets have been filed, and reciting the details of such filing. SECTION 4.04. COSTS AND EXPENSES. Seller agrees to pay all reasonable costs and disbursements in connection with the perfection and the maintenance of perfection, as against all third parties, of (i) Trust Depositor's, the Issuer's and the Indenture Trustee's right, title and interest in and to the Contract Assets (including, without limitation, the security interest in the Motorcycles related thereto) and (ii) the security interests provided for in the Indenture. SECTION 4.05 SALE TREATMENT. Each of Seller and Trust Depositor shall treat the transfer of Contract Assets made hereunder (including in respect of Subsequent Contracts) for all purposes (including tax and financial accounting purposes) as a sale and purchase on all of its relevant books, records, financial statements and other applicable documents. SECTION 4.06 SEPARATENESS FROM TRUST DEPOSITOR. The Seller agrees to take or refrain from taking or engaging in with respect to the Trust Depositor each of the actions or activities specified in the "substantive consolidation" opinion of Winston & Strawn LLP (or in any related certificate of Seller) delivered on the Closing Date, upon which the conclusions expressed therein are based. SECTION 4.07 PROTECTION OF SECURITY INTERESTS. The Seller agrees to deliver an Officer's Certificate to the Owner Trustee and the Indenture Trustee, as promptly as practicable after the Closing Date (or Subsequent Transfer Date, as the case may be), and in any event within 60 days thereof, certifying that the Seller's compliance officer has reviewed the original of each Initial Contract and each related Contract File, that each Initial Contract and related Contract File conforms in all material respects with the initial List of Contracts and each such Contract File is complete and that each document required be an original. - 13 - ARTICLE V REMEDIES UPON MISREPRESENTATION SECTION 5.01. REPURCHASES OF CONTRACTS FOR BREACH OF REPRESENTATIONS AND WARRANTIES. Seller hereby agrees, for the benefit of the Issuer, the Indenture Trustee and the Trust Depositor, that it shall repurchase a Contract including any Subsequent Contracts (together with all related Contract Assets), at its Repurchase Price, not later than two Business Days prior to the first Determination Date after Seller becomes aware, or should have become aware, or receives written notice from Trust Depositor, either of the Trustees or the Servicer of any breach of a representation or warranty of Seller set forth in Article III of this Agreement that materially adversely affects Trust Depositor's or the Trust's interest in such Contract (without regard to the benefits of the Reserve Fund) and which breach has not been cured; PROVIDED, HOWEVER, that with respect to any Contract described on the List of Contracts with respect to an incorrect unpaid Principal Balance which Seller would otherwise be required to repurchase pursuant to this Section 5.01 and Section 7.08 of the Sale and Servicing Agreement, Seller may, in lieu of repurchasing such Contract, deposit in the Collection Account not later than two Business Days prior to such Determination Date cash in an amount sufficient to cure any deficiency or discrepancy; and PROVIDED FURTHER that with respect to a breach of a representation or warranty relating to the Contracts in the aggregate and not to any particular Contract, Seller may select Contracts (without adverse selection) to repurchase such that had such Contracts not been reconveyed by Trust Depositor and included as part of the Trust there would have been no breach of such representation or warranty; PROVIDED FURTHER that the failure to maintain perfection of the security interest in the Motorcycle securing a Contract in accordance with the Sale and Servicing Agreement, shall be deemed to be a breach materially and adversely affecting the Trust's interest in the Contracts or in the related Contract Assets. Notwithstanding any other provision of this Agreement, the obligation of Seller under this Section 5.01 and under Section 7.08 of the Sale and Servicing Agreement shall not terminate upon a Service Transfer pursuant to Article VIII of the Sale and Servicing Agreement. SECTION 5.02. SELLER'S REPURCHASE OPTION. On written notice to the Owner Trustee and the Indenture Trustee at least 20 days prior to a Distribution Date, provided the Pool Balance is then less than 10% of the Aggregate Principal Balance as of the Closing Date, Seller may (but is not required to) repurchase from the Trust on that Distribution Date all outstanding Contracts (and related Contract Assets) at a price equal to the aggregate unpaid principal balance of the Notes on the previous Distribution Date plus the aggregate of the Note Interest Distributable Amount for the current Distribution Date, the Reimbursement Amount (if any) as well as accrued and unpaid Monthly Servicing Fees and Indenture Trustee Fee to the date of such repurchase. Such price will be deposited in the Collection Account not later than one Business Day before such Distribution Date, against the Trustees' release of the Contracts and Contract Files as described in Section 7.10 of the Sale and Servicing Agreement. - 14 - ARTICLE VI INDEMNITIES SECTION 6.01. SELLER INDEMNIFICATION. Seller will defend and indemnify Trust Depositor, the Trust, the Trustees, any agents of the Trustees and the Noteholders against any and all costs, expenses, losses, damages, claims and liabilities, joint or several, including reasonable fees and expenses of counsel and expenses of litigation arising out of or resulting from (i) this Agreement or the use, ownership or operation of any Motorcycle by Seller or the Servicer or any Affiliate of either, (ii) any representation or warranty or covenant made by Seller in this Agreement being untrue or incorrect (subject to the second sentence of the preamble to Article III of this Agreement above), and (iii) any untrue statement or alleged untrue statement of a material fact contained in the Prospectus or in any amendment thereto or the omission or alleged omission to state therein a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement was made in conformity with information furnished to Trust Depositor by Seller specifically for use therein. Notwithstanding any other provision of this Agreement, the obligation of Seller under this Section 6.01 shall not terminate upon a Service Transfer pursuant to Article VIII of the Sale and Servicing Agreement and shall survive any termination of that agreement or this Agreement. SECTION 6.02. LIABILITIES TO OBLIGORS. No obligation or liability to any Obligor under any of the Contracts is intended to be assumed by the Trustees, the Trust or the Noteholders under or as a result of this Agreement and the transactions contemplated hereby. SECTION 6.03. TAX INDEMNIFICATION. Seller agrees to pay, and to indemnify, defend and hold harmless the Trust Depositor, the Trust, the Trustees or the Noteholders from, any taxes which may at any time be asserted with respect to, and as of the date of, the transfer of the Contracts to Trust Depositor hereunder and the concurrent reconveyance to the Trust and the further pledge by the Trust to the Indenture Trustee, including, without limitation, any sales, gross receipts, general corporation, personal property, privilege or license taxes (but not including any federal, state or other taxes arising out of the creation of the Trust and the issuance of the Notes) and costs, expenses and reasonable counsel fees in defending against the same, whether arising by reason of the acts to be performed by Seller under this Agreement or the Servicer under the Sale and Servicing Agreement or imposed against the Trust, a Noteholder or otherwise. Notwithstanding any other provision of this Agreement, the obligation of Seller under this Section 6.03 shall not terminate upon a Service Transfer pursuant to Article VIII of the Sale and Servicing Agreement and shall survive any termination of this Agreement. SECTION 6.04. OPERATION OF INDEMNITIES. Indemnification under this Article VI shall include, without limitation, reasonable fees and expenses of counsel and expenses of litigation. If Seller has made any indemnity payments to Trust Depositor or the Trustees pursuant to this Article VI and Trust Depositor or the Trustees thereafter collects any of such amounts from others, Trust Depositor or the Trustees will repay such amounts collected to Seller, except that any payments received by Trust Depositor or the Trustees from an insurance provider as a result - 15 - of the events under which the Seller's indemnity payments arose shall be repaid prior to any repayment of the Seller's indemnity payment. ARTICLE VII MISCELLANEOUS SECTION 7.01. PROHIBITED TRANSACTIONS WITH RESPECT TO THE TRUST. Seller shall not: (a) Provide credit to any Noteholder for the purpose of enabling such Noteholder to purchase Notes; (b) Purchase any Notes in an agency or trustee capacity; or (c) Except in its capacity as Servicer as provided in the Sale and Servicing Agreement, lend any money to the Trust. SECTION 7.02. MERGER OR CONSOLIDATION. (a) Except as otherwise provided in this Section 7.02, Seller will keep in full force and effect its existence, rights and franchises as a Nevada corporation, and will obtain and preserve its qualification to do business as a foreign corporation in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Agreement and of any of the Contracts and to perform its duties under this Agreement. (b) Any person into which Seller may be merged or consolidated, or any corporation or other entity resulting from such merger or consolidation to which Seller is a party, or any person succeeding to the business of Seller, shall be the successor to Seller hereunder, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. (c) Upon the merger or consolidation of the Seller as described in this Section 7.02, the Seller shall provide Standard & Poor's and Moody's notice of such merger or consolidation within thirty (30) days after completion of the same. SECTION 7.03. TERMINATION. This Agreement shall terminate (after distribution of any Note Distributable Amount due pursuant to Section 7.05 of the Sale and Servicing Agreement) on the Distribution Date on which the principal balance of the Class A-1 Notes, Class A-2 Notes and the Class B Notes is reduced to zero; PROVIDED, that Seller's representations and warranties and indemnities by Seller shall survive termination. SECTION 7.04. ASSIGNMENT OR DELEGATION BY SELLER. Except as specifically authorized hereunder, Seller may not convey and assign or delegate any of its rights or obligations hereunder absent the prior written consent of Trust Depositor and the Trustees, and any attempt to do so without such consent shall be void. - 16 - SECTION 7.05. AMENDMENT. (a) This Agreement may be amended from time to time by Seller and Trust Depositor, with notice to the Rating Agencies, but without the consent of the Trustees or any of the Noteholders to correct manifest error, to cure any ambiguity, to correct or supplement any provisions herein or therein which may be inconsistent with any other provisions herein, therein or in the Prospectus, as the case may be, or to add any other provisions with respect to matters or questions arising under this Agreement which shall not be inconsistent with the provisions of this Agreement or the Prospectus; PROVIDED, HOWEVER, that such action shall not, as evidenced by an Opinion of Counsel for Seller acceptable to the Trustees, adversely affect the interests of any Noteholder. (b) This Agreement may also be amended from time to time by Seller and Trust Depositor, with the consent of the Modified Required Holders, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Indenture Trustee for the benefit of Noteholders; PROVIDED, HOWEVER, that no such amendment or waiver shall (a) reduce in any manner the amount of, or delay the timing of, collections of payments on the Contracts or distributions which are required to be made on any Note or (b) reduce the aforesaid percentage required to consent to any such amendment, without the consent of the holders of all Notes then outstanding. (c) Promptly after the execution of any amendment or consent pursuant to this Section 7.05, Trust Depositor shall furnish written notification of the substance of such amendment and a copy of such amendment to each Trustee and each Rating Agency. (d) It shall not be necessary for the consent of Noteholders under this Section 7.05 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent shall approve the substance thereof. The manner of obtaining such consents and of evidencing the authorization of the execution thereof by Noteholders shall be subject to such reasonable requirements as the Trustees may prescribe. (e) Upon the execution of any amendment or consent pursuant to this Section 7.05, this Agreement shall be modified in accordance therewith, and such amendment or consent shall form a part of this Agreement for all purposes, and every holder of Notes theretofore or thereafter issued hereunder shall be bound thereby. SECTION 7.06. NOTICES. All notices, demands, certificates, requests and communications hereunder ("notices") shall be in writing and shall be effective (a) upon receipt when sent through the U.S. mails, registered or certified mail, return receipt requested, postage prepaid, with such receipt to be effective the date of delivery indicated on the return receipt, or (b) one Business Day after delivery to an overnight courier, or (c) on the date personally delivered to an Authorized Officer of the party to which sent, or (d) on the date transmitted by legible telecopier transmission with a confirmation of receipt, in all cases addressed to the recipient at the address for such recipient set forth in the Sale and Servicing Agreement. - 17 - Each party hereto may, by notice given in accordance herewith to each of the other parties hereto, designate any further or different address to which subsequent notices shall be sent. All communications and notices pursuant hereto to Noteholders shall be in writing and delivered or mailed at the address shown in the Note Register. SECTION 7.07. MERGER AND INTEGRATION. Except as specifically stated otherwise herein, this Agreement sets forth the entire understanding of the parties relating to the subject matter hereof, and all prior understandings, written or oral, are superseded by this Agreement. This Agreement may not be modified, amended, waived, or supplemented except as provided herein. SECTION 7.08. HEADINGS. The headings herein are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. SECTION 7.09. GOVERNING LAW. This Agreement shall be governed by, and construed and enforced in accordance with, the internal laws of the State of Illinois. SECTION 7.10. NO BANKRUPTCY PETITION. The Seller covenants and agrees that, prior to the date that is one year and one day after the payment in full of all amounts owing in respect of all outstanding Securities, as well as any other amounts distributable or payable from the Trust Estate, together with any other amounts owing in respect of obligations of the Trust Depositor, it will not institute against, or solicit or join in or cooperate with or encourage any Person to institute against, the Trust Depositor or the Trust, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceedings under the laws of the United State or any State of the United States. This Section 7.10 shall survive termination of this Agreement. [signature page follows] - 18 - EXHIBIT 10.1 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized as of the date first written above. HARLEY-DAVIDSON CUSTOMER FUNDING CORP. By: ------------------------------------------ Printed Name: Title: HARLEY-DAVIDSON CREDIT CORP. By: ------------------------------------------ Printed Name: Title: Signature Page to Transfer and Sale Agreement Exhibit A Transfer and Sale Agreement FORM OF ASSIGNMENT In accordance with the Transfer and Sale Agreement (the "AGREEMENT") dated as of [_____] made by and between the undersigned, as seller thereunder ("SELLER"), and Harley-Davidson Customer Funding Corp., a Nevada corporation and wholly-owned subsidiary of Seller ("TRUST DEPOSITOR"), as purchaser thereunder, the undersigned does hereby sell, transfer, convey and assign, set over and otherwise convey to Trust Depositor (i) all the right, title and interest of Seller in and to the Initial Contracts listed on the initial List of Contracts in effect on the Closing Date (including, without limitation, all security interests and all rights to receive payments which are collected pursuant thereto after the Initial Cutoff Date, including any liquidation proceeds therefrom, but excluding any rights to receive payments which were collected pursuant thereto on or prior to the Initial Cutoff Date), (ii) all rights of Seller under any physical damage or other individual insurance policy (including a "FORCED PLACED" policy, if any), any debt insurance policy or any debt cancellation agreement relating to any such Contract, an Obligor or a Motorcycle securing such Contract, (iii) all security interests in each such Motorcycle, (iv) all documents contained in the related Contract Files, (v) all rights of Seller in the Lockbox, Lockbox Account and related Lockbox Agreement to the extent they relate to the Contracts, (vi) all rights (but not the obligations) of the Seller under any motorcycle dealer agreements between the dealers (i.e. originators of certain Contracts) and the Seller, (vii) all rights of Seller to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Contracts and (viii) all proceeds and products of the foregoing This Assignment is made pursuant to and in reliance upon the representation and warranties on the part of the undersigned contained in Article III of the Agreement and no others. Capitalized terms used herein but not otherwise defined shall have the meanings assigned to such terms in the Sale and Servicing Agreement dated as of [_____] made by and among the undersigned, as servicer, the Trust Depositor, Harley-Davidson Motorcycle Trust [_____], as issuer, and [_____], as indenture trustee. A-1 IN WITNESS WHEREOF, the undersigned has caused this Assignment to be duly executed this ___ day of [_____]. HARLEY-DAVIDSON CREDIT CORP. By: ------------------------------------------ Printed Name: Title: A-2 Exhibit B Transfer and Sale Agreement FORM OF OFFICER'S CERTIFICATE (See Exhibit C to the Sale and Servicing Agreement) B-1 Exhibit C Transfer and Sale Agreement FORM OF SUBSEQUENT PURCHASE AGREEMENT SUBSEQUENT PURCHASE AGREEMENT (the "AGREEMENT"), dated as of ____________, _______, by and among Harley-Davidson Customer Funding Corp., a Nevada corporation (the "TRUST DEPOSITOR"), and Harley-Davidson Credit Corp., a Nevada corporation (the "SELLER"), pursuant to the Transfer and Sale Agreement referred to below. WITNESSETH: WHEREAS, the Trust Depositor and the Seller are parties to the Transfer and Sale Agreement, dated as of [_____] (the "TRANSFER AND SALE AGREEMENT"); WHEREAS, pursuant to the Transfer and Sale Agreement, the Seller wishes to sell the Subsequent Contracts to the Trust Depositor, and the Trust Depositor wishes to purchase the same, for the purchase price set forth in SECTION 3 below; and WHEREAS, the Seller has timely delivered an Addition Notice related to such conveyance as required in the Sale and Servicing Agreement dated as of [_____] among the Seller (in the capacity of Servicer thereunder), the Issuer as defined therein, the Trust Depositor and the Indenture Trustee as defined therein (the "SALE AND SERVICING AGREEMENT"). NOW, THEREFORE, the Trust Depositor and the Seller hereby agree as follows: SECTION 1. Capitalized terms used herein shall have the meanings ascribed to them in the Sale and Servicing Agreement unless otherwise defined herein. "SUBSEQUENT CUTOFF DATE" shall mean, with respect to the Subsequent Contracts transferred hereby, [_________]. "SUBSEQUENT CONTRACTS" shall mean, for purposes of this Agreement, the Subsequent Contracts listed in the Subsequent List of Contracts attached hereto as Exhibit A. "SUBSEQUENT TRANSFER DATE" shall mean, with respect to the Subsequent Contracts transferred hereby, [__________]. SECTION 2. SUBSEQUENT LIST OF CONTRACTS. The Subsequent List of Contracts attached hereto as Exhibit A is a supplement to the initial List of Contracts attached as EXHIBIT H to the Sale and Servicing Agreement. The Contracts listed in the Subsequent List of Contracts C-1 constitute the Subsequent Contracts to be transferred pursuant to this Agreement on the subsequent Transfer Date. SECTION 3. TRANSFER OF SUBSEQUENT CONTRACTS. Subject to and upon the terms and conditions set forth in Section 2.04(b) of the Transfer and Sale Agreement and this Agreement, Seller hereby sells, transfers, assigns, sets over and otherwise conveys to Trust Depositor, in consideration of Trust Depositor's payment of $[_______] as the purchase price therefor, (i) all the right, title and interest of Seller in and to the Subsequent Contracts listed on the related Subsequent List of Contracts (including, without limitation, all security interests and all rights to receive payments which are collected pursuant thereto after the applicable Subsequent Cutoff Date, including any liquidation proceeds therefrom, but excluding any rights to receive payments which were collected pursuant thereto on or prior to such Subsequent Cutoff Date), (ii) all rights of Seller under any physical damage or other individual insurance policy (including a "FORCED PLACED" policy, if any), any debt insurance policy or any debt cancellation agreement relating to any such Subsequent Contract, an Obligor or a Motorcycle securing such Subsequent Contract, (iii) all security interests in each such Motorcycle, (iv) all documents contained in the related Subsequent Contract Files, (v) all rights of Seller in the Lockbox, Lockbox Account and related Lockbox Agreement to the extent they relate to the Subsequent Contracts, (vi) all rights (but not the obligations) of the Seller under any motorcycle dealer agreements between the dealers (I.E. originators of certain Subsequent Contracts) and the Seller, (vii) all rights of Seller to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Subsequent Contracts and (viii) all proceeds and products of the foregoing. It is the intention of the Seller and the Trust Depositor that the transfer contemplated by this Agreement shall constitute a sale of the Subsequent Contracts from the Seller to the Trust Depositor, conveying good title thereto free and clear of any Liens, and that the Subsequent Contracts shall not be part of the Seller's estate in the event of the filing of a bankruptcy petition by or against Seller under any bankruptcy or similar law. SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE SELLER. (a) Seller hereby represents and warrants to the Trust Depositor that the representations and warranties of Seller in Section 3.01 of the Transfer and Sale Agreement are true and correct as of the Subsequent Transfer Date. (b) Seller hereby repeats and remakes with respect to the Subsequent Contracts as of the Subsequent Transfer Date (i) the representations and warranties of Seller in Sections 3.02, 3.03 and 3.04 of the Transfer and Sale Agreement, except that, with respect to subsection (b) of Section 3.03, (A) approximately _____% of the Principal Balance of the Contracts as of the Subsequent Cutoff Date is attributable to loans for purchases of new Motorcycles and approximately ___% is attributable to loans for purchases of used Motorcycles, and (B) no Contract was originated after the Subsequent Cutoff Date, as well as (ii) covenants to provide the certificate required by Section 2.02(h) (solely with respect to the Subsequent Contracts). (c) Seller hereby represents and warrants that (a) the aggregate Principal Balance of the Subsequent Contracts listed on the Subsequent List of Contracts and conveyed to the Trust C-2 Depositor pursuant to this Agreement is $[_____] as of the Subsequent Cutoff Date, and (b) the conditions set forth in Section 2.04(b) of the Transfer and Sale Agreement have been satisfied as of the Subsequent Transfer Date. SECTION 5. RATIFICATION OF AGREEMENT. As supplemented by this Agreement, the Transfer and Sale Agreement is in all respects ratified and confirmed and, as so supplemented by this Agreement, shall be read, taken and construed as one and the same instrument. SECTION 6. COUNTERPARTS. This Agreement may be executed in two or more counterparts (and by different parties in separate counterparts), each of which shall be an original but all of which together shall constitute one and the same instrument. SECTION 7. GOVERNING LAW. This Agreement shall be construed in accordance with the laws of the State of Illinois, without reference to its conflict of law provisions, and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws. C-3 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized as of the date first written above. HARLEY-DAVIDSON CUSTOMER FUNDING CORP. By: ------------------------------------------ Printed Name: Title: HARLEY-DAVIDSON CREDIT CORP. By: ------------------------------------------ Printed Name: Title: EX-10.2 7 a2158269zex-10_2.txt EXHIBIT 10.2 EXHIBIT 10.2 ================================================================================ SALE AND SERVICING AGREEMENT among HARLEY-DAVIDSON MOTORCYCLE TRUST [_____], as Issuer, HARLEY-DAVIDSON CUSTOMER FUNDING CORP., as Trust Depositor, HARLEY-DAVIDSON CREDIT CORP., as Servicer and [_____], as Indenture Trustee Dated as of [_____] ================================================================================
Page ---- TABLE OF CONTENTS ARTICLE ONE DEFINITIONS...........................................................................................1 SECTION 1.01. DEFINITIONS................................................................................1 SECTION 1.02. USAGE OF TERMS............................................................................21 SECTION 1.03. SECTION REFERENCES........................................................................21 SECTION 1.04. CALCULATIONS..............................................................................21 SECTION 1.05. ACCOUNTING TERMS..........................................................................21 ARTICLE TWO TRANSFER OF CONTRACTS................................................................................21 SECTION 2.01. CLOSING...................................................................................21 SECTION 2.02. CONDITIONS TO THE CLOSING.................................................................22 SECTION 2.03. CONVEYANCE OF SUBSEQUENT CONTRACTS........................................................23 ARTICLE THREE REPRESENTATIONS AND WARRANTIES.....................................................................26 SECTION 3.01. REPRESENTATIONS AND WARRANTIES REGARDING THE TRUST DEPOSITOR..............................27 SECTION 3.02. REPRESENTATIONS AND WARRANTIES REGARDING THE SERVICER.....................................29 ARTICLE FOUR PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS.........................................30 SECTION 4.01. CUSTODY OF CONTRACTS......................................................................30 SECTION 4.02. FILING....................................................................................31 SECTION 4.03. NAME CHANGE OR RELOCATION.................................................................32 SECTION 4.04. COSTS AND EXPENSES........................................................................32 ARTICLE FIVE SERVICING OF CONTRACTS..............................................................................32 SECTION 5.01. RESPONSIBILITY FOR CONTRACT ADMINISTRATION................................................32 SECTION 5.02. STANDARD OF CARE..........................................................................33 SECTION 5.03. RECORDS...................................................................................33 SECTION 5.04. INSPECTION................................................................................33 SECTION 5.05. TRUST ACCOUNTS............................................................................33 SECTION 5.06. ENFORCEMENT...............................................................................35 SECTION 5.07. TRUSTEES TO COOPERATE.....................................................................37 SECTION 5.08. COSTS AND EXPENSES........................................................................37 SECTION 5.09. MAINTENANCE OF SECURITY INTERESTS IN MOTORCYCLES..........................................38 SECTION 5.10. SUCCESSOR SERVICER/LOCKBOX AGREEMENTS.....................................................38 SECTION 5.11. SEPARATE ENTITY EXISTENCE.................................................................38 ARTICLE SIX THE TRUST DEPOSITOR..................................................................................38 SECTION 6.01. COVENANTS OF THE TRUST DEPOSITOR..........................................................38 SECTION 6.02. LIABILITY OF TRUST DEPOSITOR; INDEMNITIES.................................................41 SECTION 6.03. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, TRUST DEPOSITOR; CERTAIN LIMITATIONS.......................................................................42 SECTION 6.04. LIMITATION ON LIABILITY OF TRUST DEPOSITOR AND OTHERS.....................................43 SECTION 6.05. TRUST DEPOSITOR NOT TO RESIGN.............................................................43 ARTICLE SEVEN DISTRIBUTIONS; RESERVE FUND........................................................................44 SECTION 7.01. MONTHLY DISTRIBUTIONS.....................................................................44 SECTION 7.02. FEES......................................................................................44 SECTION 7.03. ADVANCES; REALIZATION OF CARRYING CHARGE..................................................44 SECTION 7.04. INTEREST RESERVE ACCOUNT..................................................................45 SECTION 7.05. DISTRIBUTIONS; PRIORITIES.................................................................45 SECTION 7.06. RESERVE FUND..............................................................................48 SECTION 7.07. ESTABLISHMENT OF PRE-FUNDING ACCOUNT......................................................49 SECTION 7.08. REACQUISITION OF CONTRACTS FOR BREACH OF REPRESENTATIONS AND WARRANTIES...................50 SECTION 7.09. REASSIGNMENT OF REACQUIRED CONTRACTS......................................................51 SECTION 7.10. SELLER'S REACQUISITION OPTION.............................................................51 ARTICLE EIGHT EVENTS OF TERMINATION; SERVICE TRANSFER............................................................51
i SECTION 8.01. EVENTS OF TERMINATION.....................................................................51 SECTION 8.02. WAIVER OF EVENT OF TERMINATION............................................................52 SECTION 8.03. SERVICE TRANSFER..........................................................................52 SECTION 8.04. SUCCESSOR SERVICER TO ACT; APPOINTMENT OF SUCCESSOR SERVICER..............................53 SECTION 8.05. NOTIFICATION TO SECURITYHOLDERS...........................................................53 SECTION 8.06. EFFECT OF TRANSFER........................................................................54 SECTION 8.07. DATABASE FILE.............................................................................54 SECTION 8.08. SUCCESSOR SERVICER INDEMNIFICATION........................................................54 SECTION 8.09. RESPONSIBILITIES OF THE SUCCESSOR SERVICER................................................54 SECTION 8.10. LIMITATION OF LIABILITY OF SERVICER.......................................................55 SECTION 8.11. MERGER OR CONSOLIDATION OF SERVICER.......................................................55 SECTION 8.12. SERVICER NOT TO RESIGN....................................................................56 SECTION 8.13. APPOINTMENT OF SUBSERVICER................................................................56 ARTICLE NINE REPORTS ............................................................................................56 SECTION 9.01. MONTHLY REPORTS...........................................................................56 SECTION 9.02. OFFICER'S CERTIFICATE.....................................................................56 SECTION 9.03. OTHER DATA................................................................................56 SECTION 9.04. ANNUAL REPORT OF ACCOUNTANTS..............................................................56 SECTION 9.05. ANNUAL STATEMENT OF COMPLIANCE FROM SERVICER..............................................58 SECTION 9.06. MONTHLY REPORTS TO NOTEHOLDERS............................................................58 ARTICLE TEN TERMINATION..........................................................................................60 SECTION 10.01. SALE OF TRUST ASSETS......................................................................60 ARTICLE ELEVEN MISCELLANEOUS.....................................................................................60 SECTION 11.01. AMENDMENT.................................................................................60 SECTION 11.02. PROTECTION OF TITLE TO TRUST..............................................................62 SECTION 11.03. GOVERNING LAW.............................................................................63 SECTION 11.04. NOTICES...................................................................................63 SECTION 11.05. SEVERABILITY OF PROVISIONS................................................................65 SECTION 11.06. ASSIGNMENT................................................................................65 SECTION 11.07. THIRD PARTY BENEFICIARIES.................................................................65 SECTION 11.08. COUNTERPARTS..............................................................................66 SECTION 11.09. HEADINGS..................................................................................66 SECTION 11.10. NO BANKRUPTCY PETITION; DISCLAIMER AND SUBORDINATION......................................66 SECTION 11.11. LIMITATION OF LIABILITY OF OWNER TRUSTEE AND INDENTURE TRUSTEE............................67

ii EXHIBITS Exhibit A Form of Assignment A-1 Exhibit B Form of Closing Certificate of Trust Depositor B-1 Exhibit C Form of Closing Certificate of Seller/Servicer C-1 Exhibit D Form of Opinion of Counsel for Trust Depositor regarding general corporate matters (including perfection opinion) D-1 Exhibit E Form of Opinion of Counsel for Trust Depositor regarding the "TRUE SALE" nature of the transaction E-1 Exhibit F Form of Opinion of Counsel for Trust Depositor regarding non-consolidation F-1 Exhibit G Form of Certificate Regarding Reacquired Contracts G-1 Exhibit H List of Contracts H-1 Exhibit I Form of Monthly Report to Noteholders and the Certificateholder I-1 Exhibit J Seller's Representations and Warranties J-1 Exhibit K Lockbox Bank and Lockbox Account K-1 Exhibit L Form of Subsequent Transfer Agreement L-1

iii SALE AND SERVICING AGREEMENT, dated as of [_____], among Harley-Davidson Motorcycle Trust [_____] (together with its successors and assigns, the "ISSUER" or the "TRUST"), Harley-Davidson Customer Funding Corp. (together with its successor and assigns, the "TRUST DEPOSITOR"), [_____] (solely in its capacity as Indenture Trustee together with its successors and assigns, the "INDENTURE TRUSTEE") and Harley-Davidson Credit Corp. (solely in its capacity as Servicer together with its successor and assigns, "HARLEY-DAVIDSON CREDIT" or the "SERVICER"). WHEREAS the Issuer desires to acquire from the Trust Depositor an initial and one or more subsequent pools of fixed-rate, simple interest motorcycle conditional sales contracts and promissory note and security agreements relating to Harley-Davidson and Buell motorcycles and motorcycles not manufactured by Harley-Davidson or Buell (collectively, the "CONTRACTS") purchased by Harley-Davidson Credit and subsequently sold by Harley-Davidson Credit to the Trust Depositor; WHEREAS the Trust Depositor is willing to transfer and assign the Contracts to the Issuer pursuant to the terms hereof; and WHEREAS the Servicer is willing to service the Contracts pursuant to the terms hereof; NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto agree as follows: ARTICLE ONE DEFINITIONS SECTION 1.01. DEFINITIONS. Whenever used in this Agreement, the following words and phrases, unless the context otherwise requires, shall have the following meanings: "ADDITION NOTICE" means, with respect to any transfer of Subsequent Contracts to the Issuer pursuant to Section 2.03 and the Trust Depositor's corresponding prior purchase of such Contracts from the Seller, a notice, which shall be given at least 10 days prior to the related Subsequent Transfer Date, identifying the aggregate Principal Balance of the Subsequent Contracts to be transferred. "ADVANCE" means, with respect to any Distribution Date, the amounts, if any, deposited by the Servicer in the Collection Account for such Distribution Date pursuant to Section 7.03. "AFFILIATE" of any specified Person means any other Person controlling or controlled by, or under common control with, such specified Person. For the purposes of this definition, "CONTROL" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership 1 of voting securities, by contract or otherwise; and the terms "CONTROLLING" or "CONTROLLED" have meanings correlative to the foregoing. "AGGREGATE PRINCIPAL BALANCE" will equal the sum of the Principal Balances of each outstanding Contract and the Pre-Funded Amount, if any. At the time of initial issuance of the Securities, the initial aggregate principal amount of the Securities will equal the initial Pool Balance plus the initial Pre-Funded Amount. "AGGREGATE PRINCIPAL BALANCE DECLINE" means, with respect to any Distribution Date, the amount by which the Aggregate Principal Balance as of the close of business on the last day of the Due Period relating to the Distribution Date immediately preceding such Distribution Date (or as of the Initial Cutoff Date in the case of the first Distribution Date) exceeds the Aggregate Principal Balance as of the close of business on the last day of the Due Period relating to such Distribution Date. "AGREEMENT" means this Sale and Servicing Agreement, as amended, supplemented or otherwise modified from time to time in accordance with the terms hereof. "AVAILABLE MONIES" means, with respect to any Distribution Date, the sum of the Available Interest and the Available Principal for such Distribution Date. "AVAILABLE INTEREST" means, with respect to any Distribution Date, the total (without duplication) of the following amounts received by the Servicer on or in respect of the Contracts during the related Due Period: (i) all amounts received in respect of interest on the Contracts, (ii) the interest component of all Net Liquidation Proceeds, (iii) the interest component of the aggregate of the Reacquisition Prices for Contracts reacquired by the Trust Depositor pursuant to Section 7.08, (iv) all Advances made by the Servicer pursuant to Section 7.03, (v) the interest component of all amounts paid by the Trust Depositor in connection with an optional reacquisition of the Contracts pursuant to Section 7.10, (vi) all amounts received in respect of Carrying Charges transferred from the Interest Reserve Account pursuant to Section 7.03, and (vii) all amounts received in respect of interest, dividends, gains, income and earnings on investment of funds in the Trust Accounts as contemplated in Section 5.05(d). "AVAILABLE PRINCIPAL" means, with respect to any Distribution Date, the total (without duplication) of the following amounts received by the Servicer on or in respect of the Contracts during the related Due Period: (i) all amounts received in respect of principal on the Contracts, (ii) the principal component of all Net Liquidation Proceeds, (iii) the principal component of the aggregate of the Reacquisition Prices for Contracts reacquired by the Trust Depositor pursuant to Section 7.08, and (iv) the principal component of all amounts paid by the Trust Depositor in connection with an optional reacquisition of the Contracts pursuant to Section 7.10. "AVERAGE DELINQUENCY RATIO" means, for any Distribution Date, the arithmetic average of the Delinquency Ratios for such Distribution Date and the two immediately preceding Distribution Dates. 2 "AVERAGE LOSS RATIO" means, for any Distribution Date, the arithmetic average of the Loss Ratios for such Distribution Date and the two immediately preceding Distribution Dates. "BASE PROSPECTUS" means the Prospectus dated [_____] relating to the Harley-Davidson Motorcycle Trusts. "BUELL" means Buell Motorcycle Company, LLC. "BUSINESS DAY" means any day other than a Saturday or a Sunday, or another day on which banking institutions in the city of Chicago, Illinois, Wilmington, Delaware or New York, New York are authorized or obligated by law, executive order, or governmental decree to be closed. "CALCULATION DAY" means the last day of each calendar month. "CARRYING CHARGES" means, with respect to any Distribution Date, the sum of (i) the product of (x) the weighted average of the Class A-1 Rate, the Class A-2 Rate and the Class B Rate for the related Interest Period and (y) the undisbursed funds (excluding investment earnings) in the Pre-Funding Account (as of the last day of the related Due Period) and (ii) the Indenture Trustee Fee for the related Distribution Date, minus (iii) the amount of any investment earnings on funds in the Pre-Funding Account which was transferred to the Interest Reserve Account, as well as interest earnings on amounts in the Interest Reserve Account with respect to such Distribution Date. "CERTIFICATE" means the Trust Certificate (as such term is defined in the Trust Agreement), representing 100% of the beneficial equity interest in the Trust and issued pursuant to the Trust Agreement. "CERTIFICATE REGISTER" shall have the meaning specified in the Trust Agreement. "CERTIFICATEHOLDER" shall have the meaning specified in the Trust Agreement. "CLASS" means all Notes whose form is identical except for variation in denomination, principal amount or owner. "CLASS A NOTE MONTHLY PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any Distribution Date, the Class A Note Percentage of the Principal Distributable Amount for such Distribution Date. "CLASS A NOTE PERCENTAGE" means, (i) for each Distribution Date to but excluding the Distribution Date on which the principal amount of the Class A-2 Notes is reduced to zero, [_____]%; (ii) for the Distribution Date on which the principal amount of the Class A-2 Notes is reduced to zero, such percentage which represents the fraction of the Principal Distributable Amount necessary to reduce the principal amount of the Class A-2 Notes to zero; and (iii) for each Distribution Date thereafter, [_____]%. 3 "CLASS A NOTE PRINCIPAL CARRYOVER SHORTFALL" means, as of the close of any Distribution Date, the excess of the Class A Note Principal Distributable Amount with respect to the immediately preceding Distribution Date over the amount in respect of principal for the Class A Notes that is actually deposited in the Note Distribution Account on such preceding Distribution Date. "CLASS A NOTE PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any Distribution Date, the sum of the Class A Note Monthly Principal Distributable Amount with respect to such Distribution Date and the Class A Note Principal Carryover Shortfall as of the close of the immediately preceding Distribution Date; PROVIDED, HOWEVER, that the Class A Note Principal Distributable Amount shall not exceed the outstanding principal amount of the Class A Notes; and PROVIDED, FURTHER, that the Class A Note Principal Distributable Amount (i) on the Class A-1 Final Distribution Date shall not be less than the amount that is necessary (after giving effect to other amounts to be deposited in the Note Distribution Account for payment on the Class A-1 Notes on such Distribution Date and allocable to principal) to reduce the outstanding principal amount of the Class A-1 Notes to zero, and (ii) on the Class A-2 Final Distribution Date shall not be less than the amount that is necessary (after giving effect to other amounts to be deposited in the Note Distribution Account for payment on the Class A-2 Notes on such Distribution Date and allocable to principal) to reduce the outstanding principal amount of the Class A-2 Notes to zero. "CLASS A NOTES" means, collectively, the Class A-1 Notes and the Class A-2 Notes. "CLASS A-1 FINAL DISTRIBUTION DATE" means the [______] 20__ Distribution Date. "CLASS A-1 NOTEHOLDER" means the Person in whose name a Class A-1 Note is registered in the Note Register, as such term is defined in the Indenture. "CLASS A-1 RATE" means [____]% per annum (computed on the basis of a 360-day year of twelve 30-day months). "CLASS A-2 FINAL DISTRIBUTION DATE" means the [______] 20__ Distribution Date. "CLASS A-2 NOTEHOLDER" means the Person in whose name a Class A-2 Note is registered in the Note Register. "CLASS A-2 RATE" means [____]% per annum (computed on the basis of a 360-day year of twelve 30-day months). "CLASS B FINAL DISTRIBUTION DATE" means the [______] 20__ Distribution Date. "CLASS B NOTEHOLDER" means the Person in whose name a Class B Note is registered in the Note Register, as such term is defined in the Indenture. 4 "CLASS B NOTE MONTHLY PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any Distribution Date, the Class B Note Percentage of the Principal Distributable Amount for such Distribution Date. "CLASS B NOTE PERCENTAGE" means, (i) for each Distribution Date to but excluding the Distribution Date on which the principal amount of the Class A-2 Notes is reduced to zero, [_____]%; and (ii) for the Distribution Date on which the principal amount of the Class A-2 Notes is reduced to zero, that percentage that equals 100% minus the Class A Note Percentage for such Distribution Date; and (iii) [_____]% thereafter. "CLASS B NOTE PRINCIPAL CARRYOVER SHORTFALL" means, as of the close of any Distribution Date, the excess of the Class B Note Principal Distributable Amount with respect to the immediately preceding Distribution Date over the amount in respect of principal for the Class B Notes that is actually deposited in the Note Distribution Account on such preceding Distribution Date. "CLASS B NOTE PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any Distribution Date, the sum of the Class B Note Monthly Principal Distributable Amount with respect to such Distribution Date and the Class B Note Principal Carryover Shortfall as of the close of the immediately preceding Distribution Date; PROVIDED, HOWEVER, that the Class B Note Principal Distributable Amount shall not exceed the outstanding principal amount of the Class B Notes; and PROVIDED, FURTHER, that the Class B Note Principal Distributable Amount on the Class B Final Distribution Date shall not be less than the amount that is necessary (after giving effect to other amounts to be deposited in the Note Distribution Account for payment on the Class B Notes on such Distribution Date and allocable to principal) to reduce the outstanding principal amount of the Class B Notes to zero. "CLASS B RATE" means [____]% per annum (computed on the basis of a 360-day year of twelve 30-day months). "CLEARING AGENCY" shall have the meaning specified in the Indenture. "CLOSING DATE" means [_____]. "CODE" means the Internal Revenue Code of 1986, as amended. "COLLATERAL" shall have the meaning specified in the "granting clause" of the Indenture. "COLLECTION ACCOUNT" means a trust account as described in Section 5.05 maintained in the name of the Indenture Trustee and which shall be an Eligible Account. "COMPUTER FILE" means the computer file generated by the Servicer which provides information relating to the Contracts and which was used by the Seller in selecting the Contracts sold to the Trust Depositor pursuant to the Transfer and Sale Agreement (and any Subsequent Purchase Agreement) and transferred to the Trust by the Trust Depositor pursuant to this 5 Agreement (and any Subsequent Transfer Agreement), and includes the master file and the history file as well as servicing information with respect to the Contracts. "CONTRACT ASSETS" has the meaning assigned in Section 2.01 (and 2.03, as applicable in the case of Subsequent Contracts) of the Transfer and Sale Agreement. "CONTRACT FILE" means, as to each Contract, (a) the original copy of the Contract, including the executed conditional sales contract or promissory note and security agreement or other evidence of the obligation of the Obligor, (b) the original title certificate to the Motorcycle and, where applicable, the certificate of lien recordation, or, if such title certificate has not yet been issued, an application for such title certificate, or other appropriate evidence of a security interest in the covered Motorcycle; (c) the assignments of the Contract; (d) the original copy of any agreement(s) modifying the Contract including, without limitation, any extension agreement(s) and (e) documents evidencing the existence of physical damage insurance covering such Motorcycle. "CONTRACT RATE" means, as to any Contract, the annual rate of interest with respect to such Contract. "CONTRACTS" means the motorcycle conditional sales contracts or promissory note and security agreements described in the List of Contracts and constituting part of the Trust Corpus (as such list may be supplemented from time to time to reflect transfers of Subsequent Contracts), and includes, without limitation, all related security interests and any and all rights to receive payments which are collected pursuant thereto after the Initial Cutoff Date or, with respect to any Subsequent Contracts, any related Subsequent Cutoff Date, but excluding any rights to receive payments which are collected pursuant thereto on or prior to the Initial Cutoff Date, or with respect to any Subsequent Contracts, any related Subsequent Cutoff Date. "CORPORATE TRUST OFFICE" means the office of the Indenture Trustee at which at any particular time its corporate trust business shall be principally administered, which office at the date of the execution of this Agreement is located at the address set forth in Section 11.04. "CRAM DOWN LOSS" means, with respect to a Contract, if a court of appropriate jurisdiction in an insolvency proceeding shall have issued an order reducing the Principal Balance of such Contract, the amount of such reduction (with a "CRAM DOWN LOSS" being deemed to have occurred on the date of issuance of such order). "CUMULATIVE LOSS RATIO" means, as of any Distribution Date, the fraction (expressed as a percentage) computed by the Servicer by dividing (i) the aggregate Net Liquidation Losses for all Contracts since the related Cutoff Date through the end of the related Due Period by (ii) the sum of (A) the Principal Balance of the Contracts as of the Initial Cutoff Date plus (B) the Principal Balance of any Subsequent Contracts as of the related Subsequent Cutoff Date plus (C) the Pre-Funded Amount. 6 "CUTOFF DATE" means either or both (as the context may require) the Initial Cutoff Date and any Subsequent Cutoff Date. "DEFAULTED CONTRACT" means a Contract with respect to which there has occurred one or more of the following: (i) all or some portion of any payment under the Contract is 120 days or more delinquent, (ii) repossession (and expiration of any redemption period) of a Motorcycle securing a Contract or (iii) the Servicer has determined in good faith that an Obligor is not likely to resume payment under a Contract. "DELINQUENCY AMOUNT" means, as of any Distribution Date, the Principal Balance of all Contracts that were delinquent 60 days or more as of the end of the related Due Period (including Contracts in respect of which the related Motorcycles have been repossessed and are still in inventory). "DELINQUENT INTEREST" means, for each Contract and each Determination Date as to which the full payment due in the related Due Period has not been paid before the 30th day after the scheduled payment dated therefor (any such payment being "DELINQUENT" for purposes of this definition), all interest accrued on such Contract from the Due Date in the Due Period one month prior to the Due Period in which the payment is delinquent. "DELINQUENCY RATIO" means, for any Distribution Date, the fraction (expressed as a percentage) computed by dividing (a) the Delinquency Amount during the immediately preceding Due Period by (b) the Principal Balance of the Contracts as of the beginning of the related Due Period. "DELTA LOAN" means a loan made by the Seller pursuant to the program designated as the Delta Program. "DETERMINATION DATE" means the fourth Business Day following the conclusion of a Due Period during the term of this Agreement. "DISTRIBUTION DATE" means the fifteenth day of each calendar month during the term of this Agreement, or if such day is not a Business Day, the next succeeding Business Day, with the first such Distribution Date hereunder being [_____]. "DUE DATE" means, with respect to any Contract, the day of the month on which each scheduled payment of principal and interest is due on such Contract, exclusive of days of grace. "DUE PERIOD" means a calendar month during the term of this Agreement, and the Due Period related to a Determination Date or Distribution Date shall be the calendar month immediately preceding such date; PROVIDED, HOWEVER, that with respect to the Initial Determination Date or Initial Distribution Date, the Due Period shall be the period from the Initial Cutoff Date to and including [_____]. 7 "ELIGIBLE ACCOUNT" means a segregated direct deposit account maintained with the Indenture Trustee, acting in its fiduciary capacity, or a depository institution or trust company organized under the laws of the United States of America, or any of the States thereof, or the District of Columbia, having a certificate of deposit, short-term deposit or commercial paper rating of at least A-1+ by Standard & Poor's and P-1 by Moody's. "ELIGIBLE INVESTMENTS" mean book-entry securities, negotiable instruments or securities represented by instruments in bearer or registered form which evidence: (a) direct obligations of, and obligations fully guaranteed as to timely payment by, the United States of America; (b) demand deposits, time deposits or certificates of deposit of any depository institution or trust company incorporated under the laws of the United States of America or any State (or any domestic branch of a foreign bank) and subject to supervision and examination by Federal or State banking or depository institution authorities; PROVIDED, HOWEVER, that at the time of the investment or contractual commitment to invest therein, the commercial paper or other short-term senior unsecured debt obligations (other than such obligations the rating of which is based on the credit of a Person other than such depository institution or trust company) thereof shall have a credit rating from the Rating Agency in the highest investment category granted thereby; (c) commercial paper, master notes, promissory notes, demand notes or other short term debt obligations having, at the time of the investment or contractual commitment to invest therein, a rating from the Rating Agency in the highest investment category granted thereby; (d) investments in money market funds having a rating from the Rating Agency in the highest investment category granted thereby (including funds for which the Indenture Trustee or the Owner Trustee or any of their respective Affiliates is investment manager or advisor); (e) notes or bankers' acceptances issued by any depository institution or trust company referred to in CLAUSE (b); (f) repurchase obligations with respect to any security that is a direct obligation of, or fully guaranteed as to timely payment by, the United States of America or any agency or instrumentality thereof the obligations of which are backed by the full faith and credit of the United States of America, in either case entered into with a depository institution or trust company (acting as principal) described in CLAUSE (b); and (g) any other investment with respect to which the Issuer or the Servicer has received written notification from the Rating Agencies that the acquisition of such investment as an Eligible Investment will not result in a withdrawal or downgrading of the ratings on the Notes. 8 "EVENT OF TERMINATION" means an event specified in Section 8.01. "EXCESS AMOUNTS" shall mean Available Monies after distributions made in accordance with Section 7.05. "FINAL DISTRIBUTION DATE" means the Class A-1 Final Distribution Date, the Class A-2 Final Distribution Date or the Class B Final Distribution Date, as the case may be. "FUNDING PERIOD" means the period beginning on the Closing Date and ending on the first to occur of (a) the Distribution Date on which the amount on deposit in the Pre-Funding Account (after giving effect to any transfers therefrom in connection with the transfer of Subsequent Contracts to the Trust on such Distribution Date) is less than $150,000, (b) the date on which an Event of Termination occurs, (c) the date on which an Insolvency Event occurs with respect to the Trust Depositor and (d) the close of business on the date which is 90 days from and including the Closing Date. "HARLEY-DAVIDSON FINANCIAL" means Harley-Davidson Financial Services, Inc., a Delaware corporation. "HOLDER" means, with respect to a (i) Certificate, the Person in whose name such Certificate is registered in the Certificate Register and (ii) Note, the Person in whose name such Note is registered in the Note Register. "INDENTURE" means the Indenture, dated as of the date hereof, between the Issuer and the Indenture Trustee. "INDENTURE TRUSTEE" means the Person acting as Indenture Trustee under the Indenture, its successors in interest and any successor trustee under the Indenture. "INDENTURE TRUSTEE FEE" means, with respect to any Distribution Date, one-twelfth of the product of [_____]% and the sum of (i) the Principal Balance of the Contracts as of the beginning of the related Due Period and (ii) the Pre-Funded Amount as of the beginning of such period; PROVIDED, HOWEVER, in no event shall such fee be less than $200.00 per month. "INDEPENDENT" when used with respect to any specified Person, means such a Person who (i) is in fact independent of the Issuer, the Trust Depositor or the Servicer, (ii) is not a director, officer or employee of any Affiliate of the Issuer, the Trust Depositor or the Servicer, (iii) is not a person related to any officer or director of the Issuer, the Trust Depositor or the Servicer or any of their respective Affiliates, (iv) is not a holder (directly or indirectly) of more than 10% of any voting securities of Issuer, the Trust Depositor or the Servicer or any of their respective Affiliates, and (v) is not connected with the Issuer, the Trust Depositor or the Servicer as an officer, employee, promoter, underwriter, trustee, partner, director or person performing similar functions. "INITIAL CLASS A-1 NOTE BALANCE" means $[_____]. 9 "INITIAL CLASS A-2 NOTE BALANCE" means $[_____]. "INITIAL CLASS B NOTE BALANCE" means $[_____]. "INITIAL CONTRACTS" means those Contracts conveyed to the Trust on the Closing Date. "INITIAL CUTOFF DATE" means as of the close of business on [_____]. "INSOLVENCY EVENT" means, with respect to a specified Person, (i) the entry of a decree or order for relief by a court or regulatory authority having jurisdiction in respect of such Person in an involuntary case under the federal bankruptcy laws, as now or hereafter in effect, or any other present or future, federal or state, bankruptcy, insolvency or similar law, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or other similar official for such Person or for any substantial part of its property, or ordering the winding-up or liquidation of such Person's affairs, and the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days; (ii) the commencement of an involuntary case under the federal bankruptcy laws, as now or hereinafter in effect, or another present or future federal or state bankruptcy, insolvency or similar law and such case is not dismissed within 60 days; or (iii) the commencement by such Person of a voluntary case under the federal bankruptcy laws, as now or hereinafter in effect, or any other present or future federal or state, bankruptcy, insolvency or similar law, or the consent by such Person to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or other similar official for such Person or for any substantial part of its property, or the making by such Person of an assignment for the benefit of creditors or the failure by such Person generally to pay its debts as such debts become due or the taking of corporate action by such Person in furtherance of any the foregoing. "INTEREST PERIOD" means, with respect to any Distribution Date, the period from and including the fifteenth day of the month of the Distribution Date immediately preceding such Distribution Date (or, in the case of the first Distribution Date, from and including the Closing Date) to but excluding the fifteenth day of the month of such Distribution Date. "INTEREST RATE" means the Class A-1 Rate, the Class A-2 Rate or the Class B Rate, as applicable. "INTEREST RESERVE ACCOUNT" means the account designated as the Interest Reserve Account in, and which is established and maintained pursuant to, Section 7.04 hereof. "INTEREST RESERVE AMOUNT" means, as of any date of determination, the amount on deposit in the Interest Reserve Account on such date, and as of the Closing Date shall be $[_________]. "INVESTMENT EARNINGS" means, with respect to any Distribution Date, the investment earnings (net of losses and investment expenses) on amounts on deposit in the Trust Accounts, other than the Pre-Funding Account, to be deposited into the Collection Account on such Distribution Date pursuant to Section 5.05(b). 10 "ISSUER" means the Harley-Davidson Motorcycle Trust [_____]. "LATE PAYMENT PENALTY FEES" means any late payment fees paid by Obligors on Contracts after all sums received have been allocated first to regular installments due or overdue and all such installments are then paid in full. "LIEN" means a security interest, lien, charge, pledge, equity or encumbrance of any kind, other than tax liens, mechanics' liens and any liens that attach to the respective Contract by operation of law. "LIQUIDATED CONTRACT" means a Contract with respect to which there has occurred one or more of the following: (i) 90 days have elapsed following the date of repossession (and expiration of any redemption period) with respect to the Motorcycle securing such Contract, (ii) the receipt of proceeds by the Servicer from the sale of a repossessed Motorcycle securing a Contract, (iii) the Servicer has determined in good faith that all amounts expected to be recovered have been received with respect to such Contract, or (iv) all or any portion of any payment is delinquent 150 days or more. "LIST OF CONTRACTS" means the list identifying each Contract constituting part of the Trust Corpus, which list shall consist of the initial List of Contracts reflecting the Initial Contracts transferred to the Trust on the Closing Date, together with any Subsequent List of Contracts reflecting the Subsequent Contracts transferred to the Trust on the related Subsequent Transfer Date, and which list (a) identifies each Contract and (b) sets forth as to each Contract (i) the Principal Balance as of the applicable Cutoff Date, (ii) the amount of monthly payments due from the Obligor, (iii) the Contract Rate and (iv) the maturity date, and which list (as in effect on the Closing Date) is attached to this Agreement as EXHIBIT H. "LOCKBOX" means the Lockbox maintained by a Lockbox Bank identified on EXHIBIT K hereto. "LOCKBOX ACCOUNT" means the account maintained with the Lockbox Bank and identified on EXHIBIT K hereto. "LOCKBOX AGREEMENT" means the Fifth Amended and Restated Lockbox Administration Agreement dated as of November 1, 2000 by and among the Lockbox Bank, the Servicer, the Trust Depositor, Eaglemark Customer Funding Corporation-IV, The Bank of New York (successor-in-interest to the corporate trust business of Harris Trust and Savings Bank), BNY Midwest Trust Company and Bank One, National Association, with respect to the Lockbox Account, unless such agreement shall be terminated in accordance with its terms, in which event "LOCKBOX AGREEMENT" shall mean such other agreement, in form and substance acceptable to the above-described parties. "LOCKBOX BANK" means the financial institution maintaining the Lockbox Account and identified on EXHIBIT K hereto or any successor thereto. 11 "LOSS RATIO" means, for any Distribution Date, the fraction (expressed as a percentage) derived by dividing (x) Net Liquidation Losses for all Contracts that became Liquidated Contracts during the immediately preceding Due Period multiplied by twelve by (y) the outstanding Principal Balances of all Contracts as of the beginning of the Due Period. "MANDATORY REDEMPTION" means the prepayment, in part, made to the Noteholders without premium made on the Distribution Date on or immediately following the last day of the Funding Period in the event that any amount remains on deposit in the Pre-Funding Account after giving effect to the acquisition of all Subsequent Contracts, including any such acquisition on such date. "MANDATORY REDEMPTION SUBACCOUNT" means the subaccount of the Note Distribution Account into which deposits from the Pre-Funding Account for any Mandatory Redemption are made. "MODIFIED REQUIRED HOLDERS" means (i) prior to the payment in full of the Class A Notes outstanding, Class A-1 Noteholders and/or Class A-2 Noteholders evidencing at least 66 2/3% of the aggregate outstanding principal balance of the Class A Notes and (ii) from and after the payment in full of the Class A Notes outstanding, Class B Noteholders evidencing at least 66 2/3% of the aggregate outstanding principal balance of the Class B Notes. "MONTHLY REPORT" shall have the meaning specified in Section 9.06. "MONTHLY SERVICING FEE" means, as to any Distribution Date, one-twelfth of the product of [_____]% and the Principal Balance of the Contracts as of the beginning of the related Due Period or, with respect to the first Distribution Date of [_____], as of the Initial Cutoff Date. "MOODY'S" means Moody's Investors Service, Inc. or any successor thereto. "MOTORCYCLE" means a motorcycle manufactured by a subsidiary of Harley-Davidson, Inc. (or in certain limited instances Buell or certain other manufacturers) securing a Contract. "NET LIQUIDATION LOSSES" means, as of any Distribution Date, with respect to all Liquidated Contracts on an aggregate basis, the amount, if any, by which (a) the outstanding Principal Balance of all Liquidated Contracts plus accrued and unpaid interest thereon at the Contract Rate to the date on which such Liquidated Contracts became Liquidated Contracts exceeds (b) the Net Liquidation Proceeds for such Liquidated Contracts. "NET LIQUIDATION PROCEEDS" means, as to any Liquidated Contract, the proceeds realized on the sale or other disposition of the related Motorcycle, including proceeds realized on the repurchase of such Motorcycle by the originating dealer for breach of warranties, and the proceeds of any insurance relating to such Motorcycle, after payment of all reasonable expenses incurred thereby, together, in all instances, with the expected or actual proceeds of any recourse rights relating to such Contract as well as any post-disposition proceeds or other amounts in respect of a Liquidated Contract received by the Servicer. 12 "NOTEHOLDER" shall have the meaning specified in the Indenture. "NOTE DEPOSITORY AGREEMENT" shall have the meaning specified in the Indenture. "NOTE DISTRIBUTABLE AMOUNT" means, with respect to any Distribution Date, the sum of the Note Principal Distributable Amount and the Note Interest Distributable Amount for such Distribution Date. "NOTE DISTRIBUTION ACCOUNT" means the account established and maintained as such pursuant to Section 5.05. "NOTE INTEREST CARRYOVER SHORTFALL" means, with respect to any Distribution Date and a Class of Notes, the excess, if any, of the sum of the Note Interest Distributable Amount for such Class for the immediately preceding Distribution Date plus any outstanding Note Interest Carryover Shortfall for such Class on such preceding Distribution Date, over the amount in respect of interest that is actually deposited in the Note Distribution Account with respect to such Class on such preceding Distribution Date, plus, interest on such excess to the extent permitted by applicable law, at the related Interest Rate for the related Interest Period. "NOTE INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any Distribution Date and a Class of Notes, the sum of the Note Monthly Interest Distributable Amount and the Note Interest Carryover Shortfall for such Class of Notes with respect to such Distribution Date. "NOTE MONTHLY INTEREST DISTRIBUTABLE AMOUNT" means, with respect to any Distribution Date for any Class of Notes, interest accrued from and including the fifteenth day of the month of the preceding calendar month to, but excluding, the fifteenth day of the calendar month in which such Distribution Date occurs (or in the case of the first Distribution Date, interest accrued from and including the Closing Date to but excluding such Distribution Date) at the related Interest Rate for such Class of Notes on the outstanding principal amount of the Notes of such Class on the immediately preceding Distribution Date, after giving effect to all payments of principal to Noteholders of such Class on or prior to such preceding Distribution Date (or, in the case of the first Distribution Date, on the original principal amount of such Class of Notes). "NOTE POOL FACTOR" means with respect to any Class of Notes as of the close of business on any Distribution Date, a seven-digit decimal figure equal to the outstanding principal amount of such Class of Notes (after giving effect to any reductions thereof to be made on such Distribution Date) divided by the original outstanding principal amount of such Class of Notes. "NOTE PRINCIPAL CARRYOVER SHORTFALL" means the Class A Note Principal Carryover Shortfall and the Class B Note Principal Carryover Shortfall. "NOTE PRINCIPAL DISTRIBUTABLE AMOUNT" means the Class A Note Principal Distributable Amount and the Class B Note Principal Distributable Amount. "NOTE REGISTER" shall have the meaning specified in the Indenture. 13 "NOTES" means the Class A-1 Notes, the Class A-2 Notes and the Class B Notes, in each case as executed and authenticated in accordance with the Indenture. "OBLIGEE" means the Person to whom an Obligor is indebted under a Contract. "OBLIGOR" means a Motorcycle buyer or other person who owes payments under a Contract. "OFFICER'S CERTIFICATE" means a certificate signed by the Chairman, the President, a Vice President, the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary or an Assistant Secretary of any Person delivering such certificate and delivered to the Person to whom such certificate is required to be delivered, including any certificate delivered under any of the Transaction Documents required to be executed by a Servicing Officer. In the case of an Officer's Certificate of the Servicer, at least one of the signing officers must be a Servicing Officer. Unless otherwise specified, any reference herein to an Officer's Certificate shall be to an Officers' Certificate of the Servicer. "OPINION OF COUNSEL" means a written opinion of counsel (who may be counsel to the Trust Depositor or the Servicer) acceptable to the Indenture Trustee or the Owner Trustee, as the case may be. "OUTSTANDING AMOUNT" shall have the meaning specified in the Indenture. "OWNER TRUSTEE" means the Person acting, not in its individual capacity, but solely as Owner Trustee under the Trust Agreement, its successors in interest and any successor owner trustee under the Trust Agreement. "PAYING AGENT" means as described in Section 1.01 of the Indenture and Section 3.10 of the Trust Agreement. "PERSON" means any individual, corporation, estate, limited liability company, partnership, joint venture, association, joint stock company, trust (including any beneficiary thereof), unincorporated organization or government or any agency or political subdivision thereof. "POOL BALANCE" means as of any date, the Principal Balance of Contracts as of the close of business on such date. "PRE-FUNDED AMOUNT" means as of any date, the amount on deposit in the Pre-Funding Account at the close of business on such date. "PRE-FUNDING ACCOUNT" means the account designated as the Pre-Funding Account in, and which is established and maintained pursuant to Section 7.07. 14 "PRINCIPAL BALANCE" means (a) with respect to any Contract as of any date, an amount equal to the unpaid principal balance of such Contract as of the close of business on the Initial Cutoff Date or related Subsequent Cutoff Date, as applicable, reduced by the sum of (x) all payments received by the Servicer as of such date allocable to principal and (y) any Cram Down Loss in respect of such Contract; PROVIDED, HOWEVER, that (i) if (x) a Contract is reacquired by the Seller pursuant to Section 5.01 of the Transfer and Sale Agreement and Section 7.08 hereof because of a breach of representation or warranty, or if (y) the Seller gives notice of its intent to reacquire the Contracts in connection with an optional termination of the Trust pursuant to Section 5.02 of the Transfer and Sale Agreement and Section 7.10 hereof, in each case the Principal Balance of such Contract or Contracts shall be deemed as of the related Determination Date to be zero for the Due Period in which such event occurs and for each Due Period thereafter and (ii) from and after the Due Period in which a Contract becomes a Liquidated Contract, the Principal Balance of such Contract shall be deemed to be zero; and (b) where the context requires, the aggregate of the Principal Balances described in clause (a) for all such Contracts. "PRINCIPAL DISTRIBUTABLE AMOUNT" means, with respect to any Distribution Date, the Aggregate Principal Balance Decline for such Distribution Date. "PROSPECTUS" means the Base Prospectus together with the Supplement. "QUALIFIED ELIGIBLE INVESTMENTS" means Eligible Investments acquired by the Indenture Trustee in its name and in its capacity as Indenture Trustee, which are held by the Indenture Trustee in any Trust Account and with respect to which (a) the Indenture Trustee has noted its interest therein on its books and records, and (b) the Indenture Trustee has purchased such investments for value without notice of any adverse claim thereto (and, if such investments are securities or other financial assets or interests therein, within the meaning of Section 8-102 of the UCC as enacted in Illinois, without acting in collusion with a securities intermediary in violating such securities intermediary's obligations to entitlement holders in such assets, under Section 8-504 of such UCC, to maintain a sufficient quantity of such assets in favor of such entitlement holders), and (c) either (i) such investments are in the possession, or are under the control, of the Indenture Trustee, or (ii) such investments, (A) if certificated securities and in bearer form, have been delivered to the Indenture Trustee, or in registered form, have been delivered to the Indenture Trustee and either registered by the issuer thereof in the name of the Indenture Trustee or endorsed by effective endorsement to the Indenture Trustee or in blank; (B) if uncertificated securities, the ownership of which has been registered to the Indenture Trustee on the books of the issuer thereof (or another person, other than a securities intermediary, either becomes the registered owner of the uncertified security on behalf of the Indenture Trustee or, having previously become the registered owner, acknowledges that it holds for the Indenture Trustee); or (C) if securities entitlements (within the meaning of Section 8-102 of the UCC as enacted in Illinois) representing interests in securities or other financial assets (or interests therein) held by a securities intermediary (within the meaning of said Section 8-102), a securities intermediary indicates by book entry that a security or other financial asset has been credited to the Indenture Trustee's securities account with such securities intermediary. Any such Qualified Eligible Investment may be purchased by or through the Indenture Trustee or any of its affiliates. 15 "RATING AGENCY" means each of Moody's and Standard & Poor's, so long as such Persons maintain a rating on the Notes; and if either Moody's or Standard & Poor's no longer maintains a rating on the Notes, such other nationally recognized statistical rating organization selected by the Trust Depositor. "REACQUISITION PRICE" means, with respect to a Contract to be reacquired hereunder as of the last day of any Due Period an amount equal to (a) the Principal Balance of such Contract as of such day, plus (b) accrued and unpaid interest at the Contract Rate on such Contract through the end of such Due Period. "RECORD DATE" means, with respect to any Distribution Date, the close of business on the day immediately preceding such date. "REIMBURSEMENT AMOUNT" has the meaning assigned in Section 7.03 hereof. "REQUIRED HOLDERS" means (i) prior to the payment in full of the Class A Notes outstanding, Class A-1 Noteholders and Class A-2 Noteholders evidencing more than 50% of the aggregate outstanding principal balance of the Class A Notes and (ii) from and after the payment in full of the Class A Notes outstanding, Class B Noteholders evidencing more than 50% of the aggregate outstanding principal balance of the Class B Notes. "RESERVE FUND" means the Reserve Fund established and maintained pursuant to Section 7.06 hereof. "RESERVE FUND INITIAL DEPOSIT" means $[_________]. "RESERVE FUND DEPOSITS" means all moneys deposited in the Reserve Fund from time to time including, but not limited to, the Reserve Fund Initial Deposit as well as any monies deposited therein pursuant to Section 7.05(a), all investments and reinvestments thereof, earnings thereon, and proceeds of the foregoing, whether now or hereafter existing. "RESERVE FUND TRIGGER EVENT" means the occurrence with respect to any Distribution Date (i) the Average Delinquency Ratio for such Distribution Date is equal to or greater than (a) [_____]% with respect to any Distribution Date which occurs within the period from the Closing Date to, and inclusive of, the first anniversary of the Closing Date, (b) [_____]% with respect to any Distribution Date which occurs within the period from the day after the first anniversary of the Closing Date to, and inclusive of, the second anniversary of the Closing Date, or (c) [_____]% with respect to any Distribution Date which occurs within the period from the day after the second anniversary of the Closing Date to, and inclusive of, the third anniversary of the Closing Date or (d) [_____]% with respect to any Distribution Date occurring after the third anniversary of the Closing Date; (ii) the Average Loss Ratio for such Distribution Date is equal to or greater than (a) [_____]% with respect to any Distribution Date which occurs within the period from the Closing Date to, and inclusive of, the second anniversary of the Closing Date or (b) [_____]% with respect to any Distribution Date which occurs following the second anniversary of the Closing Date; or (iii) the Cumulative Loss Ratio for such Distribution Date is 16 equal to or greater than (a) [_____]% with respect to any Distribution Date which occurs within the period from the Closing Date to, and inclusive of, the first anniversary of the Closing Date, (b) [_____]% with respect to any Distribution Date which occurs within the period from the day after the first anniversary of the Closing Date to, and inclusive of, the second anniversary of the Closing Date, (c) [_____]% with respect to any Distribution Date which occurs within the period from the day after the second anniversary of the Closing Date to, and inclusive of, the third anniversary of the Closing Date, or (d) [_____]% with respect to any Distribution Date occurring after the third anniversary of the Closing Date. A Reserve Fund Trigger Event shall be deemed to have terminated with respect to a Distribution Date if no Reserve Fund Trigger Event shall exist with respect to three consecutive Distribution Dates (inclusive of the respective Distribution Date). "RESPONSIBLE OFFICER" means, with respect to the Owner Trustee, any officer in its Corporate Trust Administration Department (or any similar group of a successor Owner Trustee) and with respect to the Indenture Trustee, the chairman and any vice chairman of the board of directors, the president, the chairman and vice chairman of any executive committee of the board of directors, every vice president, assistant vice president, the secretary, every assistant secretary, cashier or any assistant cashier, controller or assistant controller, the treasurer, every assistant treasurer, every trust officer, assistant trust officer and every other authorized officer or assistant officer of the Trustee customarily performing functions similar to those performed by persons who at the time shall be such officers, respectively, or to whom a corporate trust matter is referred because of knowledge of, familiarity with, and authority to act with respect to a particular matter. "SECURITIES" means the Notes, or any of them. "SECURITYHOLDERS" means the Holders of the Notes. "SELLER" means Harley-Davidson Credit Corp., a Nevada corporation, or its successor, in its capacity as Seller of Contract Assets under the Transfer and Sale Agreement and any Subsequent Purchase Agreement. "SERVICER" means Harley-Davidson Credit Corp., a Nevada corporation, or its successor, until any Service Transfer hereunder and thereafter means the Successor Servicer appointed pursuant to Article VIII below with respect to the duties and obligations required of the Servicer under this Agreement. "SERVICE TRANSFER" has the meaning assigned in Section 8.03(a). "SERVICING FEE" means, on any Determination Date, the sum of (a) the Monthly Servicing Fee payable on the related Distribution Date, (b) Late Payment Penalty Fees received by the Servicer during the related Due Period, and (c) extension fees received by the Servicer during the related Due Period. 17 "SERVICING OFFICER" means any officer of the Servicer involved in, or responsible for, the administration and servicing of Contracts whose name appears on a list of servicing officers appearing in an Officer's Certificate furnished to the Indenture Trustee by the Servicer, as the same may be amended from time to time. "SHORTFALL" means, with respect to a Distribution Date, the excess (if any), of the sum of the amounts payable pursuant to clauses (v) through (viii) of Section 7.05(a) over Available Monies for such Distribution Date minus the amounts payable pursuant to clauses (i) through (iv) of Section 7.05(a) on such Distribution Date. "SOLVENT" means, as to any Person at any time, that (a) the fair value of the property of such Person is greater than the amount of such Person's liabilities (including disputed, contingent and unliquidated liabilities) as such value is established and liabilities evaluated for purposes of Section 101(31) of the Bankruptcy Code; (b) the present fair saleable value of the property of such Person in an orderly liquidation of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured; (c) such Person is able to realize upon its property and pay its debts and other liabilities (including disputed, contingent and unliquidated liabilities) as they mature in the normal course of business; (d) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person's ability to pay as such debts and liabilities mature; and (e) such Person is not engaged in business or a transaction, and is not about to engage in a business or a transaction, for which such Person's property would constitute unreasonably small capital. "SPECIFIED RESERVE FUND BALANCE" means, with respect to any Distribution Date, an amount equal to the greater of: (a) [_____]% of the Principal Balance of the Contracts in the Trust as of the last day of the related Due Period; PROVIDED, HOWEVER, in the event a Reserve Fund Trigger Event occurs and is continuing for three consecutive Distribution Dates (inclusive of the respective Distribution Date), the Specified Reserve Fund Balance shall be equal to [_____]% of the Principal Balance of the Contracts in the Trust as of the last day of the immediately preceding Due Period; and (b) [_____]% of the aggregate of the Initial Class A-1 Note Balance, Initial Class A-2 Note Balance and Initial Class B Note Balance; PROVIDED, HOWEVER, in no event shall the Specified Reserve Fund Balance be greater than the aggregate outstanding principal balance of the Securities. As of any Distribution Date, the amount of funds actually on deposit in the Reserve Fund may, in certain circumstances, be less than the Specified Reserve Fund Balance. "STANDARD & POOR'S" means Standard & Poor's Ratings Services, a division of The McGraw Hill Companies, or any successor thereto. 18 "SUBSEQUENT CONTRACTS" means all Contracts transferred to the Trust pursuant to Section 2.03. "SUBSEQUENT CUTOFF DATE" means the date specified as such for Subsequent Contracts in the related Subsequent Transfer Agreement. "SUBSEQUENT LIST OF CONTRACTS" means a list, in the form of the initial List of Contracts delivered on the Closing Date, but listing each Subsequent Contract transferred to the Trust pursuant to the related Subsequent Transfer Agreement. "SUBSEQUENT PURCHASE AGREEMENT" means, with respect to any Subsequent Contracts, the agreement between the Seller and the Trust Depositor pursuant to which the Seller will transfer the Subsequent Contracts to the Trust Depositor, the form of which is attached to the Transfer and Sale Agreement as EXHIBIT C. "SUBSEQUENT RESERVE FUND AMOUNT" means the amount on each Subsequent Transfer Date equal to [_____]% of the aggregate balance of the Subsequent Contracts conveyed to the Trust. "SUBSEQUENT TRANSFER AGREEMENT" means the agreement described in Section 2.03(b) hereof. "SUBSEQUENT TRANSFER DATE" means any date during the Funding Period on which Subsequent Contracts are transferred to the Trust. "SUCCESSOR SERVICER" means a servicer described in Section 8.03(b). "SUPPLEMENT" means the Prospectus Supplement dated [_____]. "TRANSACTION DOCUMENTS" means this Agreement, the Transfer and Sale Agreement, the Lockbox Agreement, the Indenture, the Trust Agreement, the Administration Agreement, the Note Depository Agreement, any Subsequent Transfer Agreement and any Subsequent Purchase Agreement. "TRANSFER AND SALE AGREEMENT" means the Transfer and Sale Agreement dated as of the date hereof by and between the Seller and the Trust Depositor, as amended, supplemented or otherwise modified from time to time. "TRUST" means the trust created by the Trust Agreement, comprised of the Trust Corpus. "TRUST ACCOUNTS" means, collectively, the Collection Account, the Pre-Funding Account, the Note Distribution Account, the Reserve Fund and the Interest Reserve Account, or any of them. 19 "TRUST ACCOUNT PROPERTY" means the Trust Accounts, all amounts and investments held from time to time in any Trust Account (whether in the form of deposit accounts, physical property, book-entry securities, uncertificated securities or otherwise), including the Reserve Fund Initial Deposit, and all proceeds of the foregoing. "TRUST AGREEMENT" means the Trust Agreement, dated as of [_________], between the Trust Depositor and the Owner Trustee. "TRUST CORPUS" has the meaning given to such term in Section 2.01(a) hereof (and in Section 2.03(a) hereof in respect of Subsequent Contracts and related assets transferred to the Trust pursuant to Subsequent Transfer Agreements). "TRUST DEPOSITOR" has the meaning assigned such term in the preamble hereunder or any successor thereto. "TRUST ESTATE" shall have the meaning specified in the Trust Agreement. "TRUSTEES" means the Owner Trustee and the Indenture Trustee. "UCC" means the Uniform Commercial Code as in effect on the date hereof AND from time to time in the State of Illinois, PROVIDED that if by reason of mandatory provisions of law, the perfection or the effect of perfection or non-perfection or priority of the security interests in any collateral or the availability of any remedy hereunder is governed by the Uniform Commercial Code as in effect on or after the date hereof in any other jurisdiction, "UCC" means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or effect of perfection or non-perfection or priority or availability of such remedy. "UNCOLLECTIBLE ADVANCE" means with respect to any Determination Date and any Contract, the amount, if any, advanced by the Servicer pursuant to Section 7.03 which the Servicer has as of such Determination Date determined in good faith will not be ultimately recoverable by the Servicer from insurance policies on the related Motorcycle, the related Obligor or out of Net Liquidation Proceeds with respect to such Contract. The determination by the Servicer that it has made an Uncollectible Advance, or, that any Advance proposed to be made would be an Uncollectible Advance, shall be evidenced by an Officer's Certificate delivered to the Trustees. "UNDERWRITERS" means [_____], [_____] and [_____]. "UNITED STATES" means the United States of America. "VICE PRESIDENT" of any Person means any vice president of such Person, whether or not designated by a number or words before or after the title "VICE PRESIDENT" who is a duly elected officer of such Person. 20 "[_____]" means [_____], in its individual capacity. SECTION 1.02. USAGE OF TERMS. With respect to all terms in this Agreement, the singular includes the plural and the plural the singular; words importing any gender include the other genders; references to "writing" include printing, typing, lithography and other means of reproducing words in a visible form; references to agreements and other contractual instruments include all amendments, modifications and supplements thereto or any changes therein entered into in accordance with their respective terms and not prohibited by this Agreement; references to Persons include their permitted successors and assigns; and the term "including" means "including without limitation." SECTION 1.03. SECTION REFERENCES. All section references, unless otherwise indicated, shall be to Sections in this Agreement. SECTION 1.04. CALCULATIONS. Except as otherwise provided herein, all interest rate and basis point calculations hereunder will be made on the basis of a 360-day year and twelve 30-day months and will be carried out to at least three decimal places. SECTION 1.05. ACCOUNTING TERMS. All accounting terms used but not specifically defined herein shall be construed in accordance with generally accepted accounting principles in the United States. ARTICLE TWO TRANSFER OF CONTRACTS SECTION 2.01. CLOSING. (a) On the Closing Date, the Trust Depositor shall transfer, assign, set over and otherwise convey to the Trust by execution of an assignment substantially in the form of EXHIBIT A hereto, without recourse other than as expressly provided herein, (i) all the right, title and interest of the Trust Depositor in and to the Initial Contracts listed on the initial List of Contracts delivered on the Closing Date (including, without limitation, all security interests and all rights to receive payments which are collected pursuant thereto after the Initial Cutoff Date, including any liquidation proceeds therefrom, but excluding any rights to receive payments which were collected pursuant thereto on or prior to the Initial Cutoff Date), (ii) all rights of the Trust Depositor under any physical damage or other individual insurance policy (and rights under a "FORCED PLACED" policy, if any), any debt insurance policy or any debt cancellation agreement relating to any such Contract, an Obligor or a Motorcycle securing such Contract, (iii) all security interests in each such Motorcycle, (iv) all documents contained in the related Contract Files, (v) all rights (but not the obligations) of the Trust Depositor under any related motorcycle dealer agreements between dealers (i.e., the originators of certain Contracts) and the Seller, (vi) all rights of the Trust Depositor in the Lockbox, the Lockbox Account and the related Lockbox Agreement to the extent they relate to the Contracts, (vii) all rights (but not the obligations) of the Trust Depositor under the Transfer and Sale Agreement, including but not limited to the Trust Depositor's rights under Article V thereof, (viii) the remittances, deposits 21 and payments made into the Trust Accounts from time to time and amounts in the Trust Accounts from time to time (and any investments of such amounts), (ix) all rights of the Trust Depositor to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Contracts and (x) all proceeds and products of the foregoing (the property in clauses (i)-(x) above, being the "TRUST CORPUS"). Although the Trust Depositor and the Owner Trustee agree that such transfer is intended to be a transfer of ownership of the Trust Corpus, rather than the granting of a security interest to secure a borrowing, and that the Trust Corpus shall not be property of the Trust Depositor, in the event such transfer is deemed to be of a mere security interest to secure a borrowing, the Trust Depositor shall be deemed to have granted the Trust a perfected first priority security interest in such Trust Corpus and this Agreement shall constitute a security agreement under applicable law. SECTION 2.02. CONDITIONS TO THE CLOSING. On or before the Closing Date, the Trust Depositor shall deliver or cause to be delivered the following documents to the Owner Trustee and the Indenture Trustee: (a) The initial List of Contracts, certified by the Chairman of the Board, President or any Vice President of the Trust Depositor, together with an assignment substantially in the form of EXHIBIT A hereto. (b) A certificate of an officer of the Seller substantially in the form of EXHIBIT B to the Transfer and Sale Agreement and of an officer of the Trust Depositor substantially in the form of EXHIBIT B hereto. (c) Opinions of counsel for the Seller and the Trust Depositor substantially in the form of EXHIBITS D, E and F hereto (and including as an addressee thereof each Rating Agency). (d) A letter or letters from [_____], or another nationally recognized accounting firm, addressed to the Seller and the Underwriters and stating that such firm has reviewed a sample of the Initial Contracts and performed specific procedures for such sample with respect to certain contract terms and which identifies those Initial Contracts which do not conform. (e) Copies of resolutions of the Board of Directors of each of the Seller/Servicer and the Trust Depositor or of the Executive Committee of the Board of Directors of each of the Seller/Servicer and the Trust Depositor approving the execution, delivery and performance of this Agreement and the other Transaction Documents to which any of them is a party, as applicable, and the transactions contemplated hereunder and thereunder, certified in each case by the Secretary or an Assistant Secretary of the Seller/Servicer and the Trust Depositor. (f) Officially certified, recent evidence of due incorporation and good standing of each of the Seller and the Trust Depositor under the laws of Nevada. 22 (g) Evidence of proper filing with the appropriate office in Nevada of a UCC financing statement naming the Seller, as debtor, naming the Trust Depositor as assignor secured party (and the Trust as secured party) and identifying the Contract Assets as collateral; and evidence of proper filing with the appropriate office in Nevada of a UCC financing statement naming the Trust Depositor, as debtor, naming the Trust as assignor secured party (and the Indenture Trustee as secured party) and identifying the Trust Corpus as collateral; and evidence of proper filing with the appropriate office in Delaware of a UCC financing statement naming the Trust, as debtor, and naming the Indenture Trustee, as secured party and identifying the Collateral as collateral. (h) An Officer's Certificate listing the Servicer's Servicing Officers. (i) Evidence of deposit in the Collection Account of all funds received with respect to the Initial Contracts after the Initial Cutoff Date to the Closing Date, together with an Officer's Certificate from the Trust Depositor to the effect that such amount is correct. (j) The Officer's Certificate of the Seller specified in Section 2.02(h) of the Transfer and Sale Agreement. (k) Evidence of deposit in the Reserve Fund of the Reserve Fund Initial Deposit by the Owner Trustee. (l) A fully executed Transfer and Sale Agreement. (m) A fully executed Trust Agreement. (n) A fully executed Administration Agreement. (o) A fully executed Indenture. SECTION 2.03. CONVEYANCE OF SUBSEQUENT CONTRACTS. (a) Subject to the conditions set forth in paragraph (b) below, the Trust Depositor, shall transfer, assign, set over and otherwise convey to the Trust, without recourse other than as expressly provided herein and therein, (i) all the right, title and interest of the Trust Depositor in and to the Subsequent Contracts listed on the Subsequent List of Contracts (including, without limitation, all security interests and all rights to receive payments which are collected pursuant thereto after the related Subsequent Cutoff Date, including any liquidation proceeds therefrom, but excluding any rights to receive payments which were collected pursuant thereto on or prior to such Subsequent Cutoff Date), (ii) all rights of the Trust Depositor under any physical damage or other individual insurance policy (including a "FORCED PLACED" policy, if any), any debt insurance policy or any debt cancellation agreement relating to any such Subsequent Contract, an Obligor or a Motorcycle securing such Subsequent Contract, (iii) all security interests in each such Motorcycle, (iv) all documents contained in the related Contract Files, (v) all rights (but not the obligations) of the Trust Depositor under any related motorcycle dealer agreements between dealers (i.e., the originators of certain Subsequent 23 Contracts) and the Seller, (vi) all rights of the Trust Depositor in the Lockbox, the Lockbox Account and the related Lockbox Agreement to the extent they relate to such Subsequent Contracts, (vii) all rights (but not the obligations) of the Trust Depositor under the Transfer and Sale Agreement related to such Subsequent Contracts (to the extent not already conveyed under Section 2.01(a)), including but not limited to the Trust Depositor's related rights under Article V thereof, as well as all rights, but not the obligations, of the Trust Depositor under the Subsequent Purchase Agreement related to such Subsequent Contracts, (viii) the remittances, deposits and payments made into the Trust Accounts from time to time and amounts in the Trust Accounts from time to time related to such Subsequent Contracts (to the extent not already conveyed under Section 2.01(a)) (and any investments of such amounts), (ix) all rights of the Trust Depositor to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Subsequent Contracts and (x) all proceeds and products of the foregoing (the property in clauses (i)-(x) above, upon such transfer, becoming part of the "TRUST CORPUS"). Although the Trust Depositor and the Owner Trustee agree that such transfer is intended to be a transfer of ownership, rather than the granting of a security interest to secure a borrowing, and that the Trust Corpus following such transfer shall not be property of the Trust Depositor, in the event such transfer is deemed to be of a mere security interest to secure a borrowing, the Trust Depositor shall be deemed to have granted the Owner Trustee for the benefit of the Trust a perfected first priority security interest in such Trust Corpus and this Agreement shall constitute a security agreement under applicable law. (b) The Trust Depositor shall transfer to the Trust the Subsequent Contracts and the other property and rights related thereto described in paragraph (a) above only upon the satisfaction of each of the following conditions on or prior to the related Subsequent Transfer Date: (i) The Trust Depositor shall have provided the Owner Trustee, the Indenture Trustee, the Underwriters and the Rating Agencies with a timely Addition Notice and shall have provided any information reasonably requested by any of the foregoing with respect to the Subsequent Contracts; (ii) the Funding Period shall not have terminated; (iii) the Trust Depositor shall have delivered to the Owner Trustee a duly executed written assignment (including an acceptance by the Owner Trustee) in substantially the form of EXHIBIT L hereto (the "SUBSEQUENT TRANSFER AGREEMENT"), which shall include a Subsequent List of Contracts listing the Subsequent Contracts; (iv) the Trust Depositor shall have deposited or caused to be deposited in the Collection Account all collections received with respect to the Subsequent Contracts after the related Subsequent Cutoff Date; 24 (v) as of each Subsequent Transfer Date, neither the Seller nor the Trust Depositor was insolvent nor will either of them have been made insolvent by such transfer nor is either of them aware of any pending insolvency; (vi) the applicable Subsequent Reserve Fund Amount for such Subsequent Transfer Date shall have been deposited by the Indenture Trustee from the Pre-Funding Account to the Reserve Fund; (vii) each Rating Agency shall have notified the Trust Depositor, the Owner Trustee and the Indenture Trustee that following such transfer the Class A-1 Notes and Class A-2 Notes will be rated in the highest rating category by such Rating Agency and the Class B Notes will be rated at least its rating as of the Closing Date by Standard & Poor's and Moody's; (viii) such addition will not result in a material adverse tax consequence to the Trust or the Certificateholder as evidenced by an Opinion of Counsel to be delivered by the Trust Depositor to the Owner Trustee, Indenture Trustee, the Rating Agencies and the Underwriters; (ix) the Trust Depositor shall have confirmed the satisfaction of each condition precedent specified in this paragraph (b); (x) the Trust Depositor shall have delivered to the Rating Agencies and the Underwriters one or more opinions of counsel (or bring-downs of opinions of counsel delivered on the Closing Date) with respect to the transfer of the Subsequent Contracts substantially in the form of the opinions of counsel delivered to such Persons on the Closing Date; (xi) no selection procedures believed by the Trust Depositor to be adverse to the interests of the Noteholders shall have been utilized in selecting the Subsequent Contracts; (xii) the Trust Depositor shall have delivered to the Rating Agencies evidence that (A) the weighted average contract rate of the Contracts collectively, following the transfer of the Subsequent Contracts, is not less than [_____]% and (B) that the weighted average calculated remaining term to maturity of the Contracts collectively, following the transfer of the Subsequent Contracts, does not exceed [_____] months; (xiii) each of the representations and warranties made by the Seller pursuant to Section 3.01 of the Transfer and Sale Agreement with respect to the Subsequent Contracts shall be true and correct as of the related Subsequent Transfer Date, and the Seller shall have performed all obligations to be performed by it hereunder on or prior to such Subsequent Transfer Date; 25 (xiv) the Seller or the Servicer shall, at its own expense, on or prior to the Subsequent Transfer Date indicate in its Computer File that the Subsequent Contracts identified on the Subsequent List of Contracts in the Subsequent Transfer Agreement have been transferred to the Issuer pursuant to this Agreement and the Transfer and Sale Agreement; and (xv) the Seller shall have taken any action required to maintain the first perfected ownership interest of the Issuer in the Trust Estate and the first perfected security interest of the Indenture Trustee in the Collateral. (c) The Trust Depositor covenants to transfer (at or prior to the end of the Funding Period) to the Trust pursuant thereto Subsequent Contracts with an aggregate Principal Balance equal to $[_________]; PROVIDED, HOWEVER, that in complying with such covenant, the Trust Depositor agrees to make no more than one separate transfer of Subsequent Contracts per monthly period (as measured by the corresponding Distribution Dates). In the event that the Trust Depositor shall fail to deliver and transfer to the Trust any or all of such Subsequent Receivables by the date on which the Funding Period ends and the Pre-Funded Amount is greater than $150,000 on such date, the Trust Depositor shall cause to be deposited into the Collection Account the amount then on deposit in the Pre-Funding Account; PROVIDED, HOWEVER, that the foregoing shall be the sole remedy of the Trust, the Owner Trustee, the Indenture Trustee and the Securityholders with respect to a failure of the Trust Depositor to comply with such covenant. ARTICLE THREE REPRESENTATIONS AND WARRANTIES The Seller under the Transfer and Sale Agreement has made, and upon execution of each Subsequent Purchase Agreement is deemed to remake, each of the representations and warranties set forth in EXHIBIT J hereto and has consented to the assignment by the Trust Depositor to the Issuer of the Trust Depositor's rights with respect thereto. Such representations speak as of the execution and delivery of this Agreement and as of the Closing Date in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date in the case of the Subsequent Contracts, but shall survive the transfer and assignment of the Contracts to the Trust. Pursuant to Section 2.01 of this Agreement, the Trust Depositor has assigned, transferred and conveyed to the Issuer as part of the Trust Corpus its rights under the Transfer and Sale Agreement, including without limitation, the representations and warranties of the Seller therein as set forth in EXHIBIT J attached hereto, together with all rights of the Trust Depositor with respect to any breach thereof including any right to require the Seller to reacquire any Contract in accordance with the Transfer and Sale Agreement. It is understood and agreed that the representations and warranties set forth or referred to in this Section shall survive delivery of the Contract Files to the Owner Trustee or any custodian. 26 The Trust Depositor hereby represents and warrants to the Trust and the Indenture Trustee that it has entered into the Transfer and Sale Agreement with the Seller, that the Seller has made the representations and warranties in the Transfer and Sale Agreement as set forth in EXHIBIT J hereto, that such representations and warranties run to and are for the benefit of the Trust Depositor, and that pursuant to Section 2.01 of this Agreement the Trust Depositor has transferred and assigned to the Trust all rights of the Trust Depositor to cause the Seller under the Transfer and Sale Agreement to reacquire Contracts in the event of a breach of such representations and warranties. SECTION 3.01. REPRESENTATIONS AND WARRANTIES REGARDING THE TRUST DEPOSITOR. By its execution of this Agreement and each Subsequent Transfer Agreement, the Trust Depositor represents and warrants to the Trust, the Indenture Trustee and the Noteholders that: (a) ASSUMPTION OF SELLER'S REPRESENTATIONS AND WARRANTIES. The representations and warranties set forth in EXHIBIT J are true and correct. (b) ORGANIZATION AND GOOD STANDING. The Trust Depositor is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has the corporate power to own its assets and to transact the business in which it is currently engaged. The Trust Depositor is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the character of the business transacted by it or properties owned or leased by it requires such qualification and in which the failure so to qualify would have a material adverse effect on the business, properties, assets, or condition (financial or other) of the Trust Depositor or the Trust. (c) AUTHORIZATION; VALID SALE; BINDING OBLIGATIONS. The Trust Depositor has the power and authority to make, execute, deliver and perform its obligations under this Agreement and the other Transaction Documents to which it is a party and all of the transactions contemplated under this Agreement and the other Transaction Documents to which it is a party, and to create the Trust and cause it to make, execute, deliver and perform its obligations under this Agreement and the other Transaction Documents to which it is a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the other Transaction Documents to which it is a party and to cause the Trust to be created. This Agreement and the related Subsequent Transfer Agreement, if any, shall effect a valid transfer and assignment of the Trust Corpus, enforceable against the Trust Depositor and creditors of and purchasers from the Trust Depositor. This Agreement and the other Transaction Documents to which the Trust Depositor is a party constitute the legal, valid and binding obligation of the Trust Depositor enforceable in accordance with their terms, except as enforcement of such terms may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights generally and by the availability of equitable remedies. 27 (d) NO CONSENT REQUIRED. The Trust Depositor is not required to obtain the consent of any other party or any consent, license, approval or authorization from, or registration or declaration with, any governmental authority, bureau or agency in connection with the execution, delivery, performance, validity or enforceability of this Agreement or the other Transaction Documents to which it is a party. (e) NO VIOLATIONS. The execution, delivery and performance of this Agreement and the other Transaction Documents to which it is a party by the Trust Depositor, and the consummation of the transactions contemplated hereby and thereby, will not violate any provision of any existing law or regulation or any order or decree of any court or of any Federal or state regulatory body or administrative agency having jurisdiction over the Trust Depositor or any of its properties or the Articles of Incorporation or Bylaws of the Trust Depositor, or constitute a material breach of any mortgage, indenture, contract or other agreement to which the Trust Depositor is a party or by which the Trust Depositor or any of the Trust Depositor's properties may be bound, or result in the creation or imposition of any security interest, lien, charge, pledge, preference, equity or encumbrance of any kind upon any of its properties pursuant to the terms of any such mortgage, indenture, contract or other agreement, other than as contemplated by the Transaction Documents. (f) LITIGATION. No litigation or administrative proceeding of or before any court, tribunal or governmental body is currently pending, or to the knowledge of the Trust Depositor threatened, against the Trust Depositor or any of its properties or with respect to this Agreement, the other Transaction Documents to which it is a party or the Notes (1) which, if adversely determined, would in the opinion of the Trust Depositor have a material adverse effect on the business, properties, assets or condition (financial or otherwise) of the Trust Depositor or the Trust or the transactions contemplated by this Agreement or the other Transaction Documents to which the Trust Depositor is a party or (2) seeking to adversely affect the federal income tax or other federal, state or local tax attributes of the Certificate or Notes. (g) STATE OF INCORPORATION; NAME; NO CHANGES. The Trust Depositor's state of incorporation is the State of Nevada. The Trust Depositor's exact legal name is as set forth in the first paragraph of this Agreement. The Trust Depositor has not changed its name, whether by amendment of its Articles of Incorporation, by reorganization or otherwise, and has not changed the location of its place of business, within the four months preceding the Closing Date. (h) SOLVENCY. The Trust Depositor, after giving effect to the conveyances made by it hereunder, is Solvent. Such representations speak as of the execution and delivery of this Agreement and as of the Closing Date in the case of the Initial Contracts, and as of the applicable Subsequent Transfer 28 Date in the case of the Subsequent Contracts, but shall survive the transfer and assignment of the Contracts to the Trust. SECTION 3.02. REPRESENTATIONS AND WARRANTIES REGARDING THE SERVICER. The Servicer represents and warrants to the Trust, the Indenture Trustee and the Noteholders that: (a) ORGANIZATION AND GOOD STANDING. The Servicer is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has the corporate power to own its assets and to transact the business in which it is currently engaged. The Servicer is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the character of the business transacted by it or properties owned or leased by it requires such qualification and in which the failure so to qualify would have a material adverse effect on the business, properties, assets, or condition (financial or otherwise) of the Servicer or the Trust. The Servicer is properly licensed in each jurisdiction to the extent required by the laws of such jurisdiction to service the Contracts in accordance with the terms hereof other than such licenses the failure to obtain would not have a material adverse effect on the business, properties, assets, or condition (financial or otherwise) of the Servicer or on the ability of the Servicer to perform its obligations hereunder. (b) AUTHORIZATION; BINDING OBLIGATIONS. The Servicer has the power and authority to make, execute, deliver and perform this Agreement and the other Transaction Documents to which the Servicer is a party and all of the transactions contemplated under this Agreement and the other Transaction Documents to which the Servicer is a party, and has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the other Transaction Documents to which the Servicer is a party. This Agreement and the other Transaction Documents to which the Servicer is a party constitute the legal, valid and binding obligation of the Servicer enforceable in accordance with their terms, except as enforcement of such terms may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights generally and by the availability of equitable remedies. (c) NO CONSENT REQUIRED. The Servicer is not required to obtain the consent of any other party or any consent, license, approval or authorization from, or registration or declaration with, any governmental authority, bureau or agency in connection with the execution, delivery, performance, validity or enforceability of this Agreement and the other Transaction Documents to which the Servicer is a party. (d) NO VIOLATIONS. The execution, delivery and performance of this Agreement and the other Transaction Documents to which the Servicer is a party by the Servicer will not violate any provisions of any existing law or regulation or any order or decree of any court or of any Federal or state regulatory body or administrative agency having jurisdiction over the Servicer or any of its properties or the Articles of Incorporation or Bylaws of the Servicer, or constitute a material breach of any mortgage, 29 indenture, contract or other agreement to which the Servicer is a party or by which the Servicer or any of the Servicer's properties may be bound, or result in the creation of or imposition of any security interest, lien, pledge, preference, equity or encumbrance of any kind upon any of its properties pursuant to the terms of any such mortgage, indenture, contract or other agreement, other than this Agreement. (e) LITIGATION. No litigation or administrative proceeding of or before any court, tribunal or governmental body is currently pending, or to the knowledge of the Servicer threatened, against the Servicer or any of its properties or with respect to this Agreement, any other Transaction Document to which the Servicer is a party which, if adversely determined, would in the opinion of the Servicer have a material adverse effect on the business, properties, assets or condition (financial or otherwise) of the Servicer or the Trust or the transactions contemplated by this Agreement or any other Transaction Document to which the Servicer is a party. ARTICLE FOUR PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS SECTION 4.01. CUSTODY OF CONTRACTS. (a) Subject to the terms and conditions of this Section 4.01, the contents of each Contract File shall be held by the Servicer, or its custodian, for the benefit of, and as agent for, the Trust as the owner thereof and the Indenture Trustee. (b) The Servicer agrees to maintain the related Contract Files at its offices where they are currently maintained, or at such other offices of the Servicer in the State of Nevada as shall from time to time be identified to the Trustees by written notice. The Servicer may temporarily move individual Contract Files or any portion thereof without notice as necessary to conduct collection and other servicing activities in accordance with its customary practices and procedures; PROVIDED, HOWEVER, that the Servicer will take all action necessary to maintain the perfection of the Trust's interest in the Contracts and the proceeds thereof. It is intended that, by the Servicer's agreement pursuant to Section 4.01(a) above and this Section 4.01(b), the Trustees shall be deemed to have possession of the Contract Files for purposes of Section 9-313 of the Uniform Commercial Code of the State in which the Contract Files are located. (c) As custodian, the Servicer shall have the following powers and perform the following duties: (i) hold, or cause the Servicer's custodian to hold, the Contract Files on behalf of the Trust, maintain accurate records pertaining to each Contract to enable it to comply with the terms and conditions of this Agreement, maintain a current inventory thereof and certify to the Owner Trustee and the Indenture Trustee annually that it, or its custodian, continues to maintain possession of such Contract Files; 30 (ii) implement policies and procedures in writing and signed by a Servicing Officer with respect to persons authorized to have access to the Contract Files on the Servicer's premises and the receipting for Contract Files taken from their storage area by an employee of the Servicer for purposes of servicing or any other purposes; (iii) attend to all details in connection with maintaining custody of the Contract Files on behalf of the Trust; (iv) at all times maintain, or cause the Servicer's custodian to maintain, the original of the fully executed Contract and store such original Contract in a fireproof vault except as may be necessary to conduct collection and servicing activities in accordance with its customary practices and procedures; and (v) as promptly as practicable after the Closing Date (or Subsequent Transfer Date, as the case may be), and in any event within 60 days thereof, deliver an Officer's Certificate to the Owner Trustee and the Indenture Trustee certifying that as of a date no earlier than the Closing Date (or Subsequent Transfer Date, as the case may be) it has conducted an inventory of the Contract Files (which in the case of Subsequent Contracts, need be only of the Contract Files related to such Subsequent Contracts) and that there exists a Contract File for each Contract and stating all exceptions to such statement, if any. (d) In performing its duties under this Section 4.01, the Servicer agrees to act with reasonable care, using that degree of skill and care that it exercises with respect to similar contracts for the installment purchase of consumer goods owned and/or serviced by it, and in any event with no less degree of skill and care than would be exercised by a prudent servicer of motorcycle conditional sales contracts and promissory notes and security agreements. The Servicer shall promptly report to the Owner Trustee and the Indenture Trustee any failure by it, or its custodian, to hold the Contract Files as herein provided and shall promptly take appropriate action to remedy any such failure. In acting as custodian of the Contract Files, the Servicer further agrees not to assert any legal or beneficial ownership interest in the Contracts or the Contract Files, except as provided in Section 5.06. The Servicer agrees to indemnify the Noteholders, the Certificateholder, the Owner Trustee and the Indenture Trustee for any and all liabilities, obligations, losses, damages, payments, costs, or expenses of any kind whatsoever which may be imposed on, incurred by or asserted against the Noteholders, the Certificateholder, the Owner Trustee and the Indenture Trustee as the result of any act or omission by the Servicer relating to the maintenance and custody of the Contract Files; PROVIDED, HOWEVER, that the Servicer will not be liable for any portion of any such amount resulting from the gross negligence or willful misconduct of any Noteholder, Certificateholder, the Owner Trustee or the Indenture Trustee. The Trustees shall have no duty to monitor or otherwise oversee the Servicer's performance as custodian hereunder. SECTION 4.02. FILING. On or prior to the Closing Date, the Servicer shall cause the UCC financing statement(s) referred to in Section 2.02(g) hereof to be filed and from time to 31 time the Servicer shall take and cause to be taken such actions and execute such documents as are necessary or desirable or as the Owner Trustee or Indenture Trustee may reasonably request to perfect and protect the Trust's first priority perfected interest in the Trust Corpus against all other persons, including, without limitation, the filing of financing statements, amendments thereto and continuation statements, the execution of transfer instruments and the making of notations on or taking possession of all records or documents of title. All financing statements filed or to be filed against the Seller in favor of the Trust Depositor or the Trust in connection herewith describing the Contract Assets as collateral shall contain a statement to the following effect: "A purchase of or security interest in any collateral described in this financing statement, except as permitted in the Transfer and Sale Agreement or Sale and Servicing Agreement, will violate the rights of the Secured Party." SECTION 4.03. NAME CHANGE OR RELOCATION. (a) During the term of this Agreement, neither the Seller nor the Trust Depositor shall change its name, identity or structure or change its state of incorporation without first giving at least 30 days' prior written notice to the Owner Trustee and the Indenture Trustee. (b) If any change in either the Seller's or the Trust Depositor's name, identity or structure or other action would make any financing or continuation statement or notice of lien filed under this Agreement seriously misleading within the meaning of applicable provisions of the UCC or any title statute, the Servicer, no later than five days after the effective date of such change, shall file such amendments as may be required to preserve and protect the Trust's interests in the Trust Corpus and the proceeds thereof. In addition, neither the Seller nor the Trust Depositor shall change its state of incorporation unless it has first taken such action as is advisable or necessary to preserve and protect the Trust's interest in the Trust Corpus. Promptly after taking any of the foregoing actions, the Servicer shall deliver to the Owner Trustee and the Indenture Trustee an opinion of counsel reasonably acceptable to the Owner Trustee and the Indenture Trustee stating that, in the opinion of such counsel, all financing statements or amendments necessary to preserve and protect the interests of the Trust in the Trust Corpus and the Indenture Trustee in the Collateral have been filed, and reciting the details of such filing. SECTION 4.04. COSTS AND EXPENSES. The Servicer agrees to pay all reasonable costs and disbursements in connection with the perfection and the maintenance of perfection, as against all third parties, of the Trust's right, title and interest in and to the Contracts (including, without limitation, the security interest in the Motorcycles granted thereby). ARTICLE FIVE SERVICING OF CONTRACTS SECTION 5.01. RESPONSIBILITY FOR CONTRACT ADMINISTRATION. The Servicer will have the sole obligation to manage, administer, service and make collections on the Contracts and perform or cause to be performed all contractual and customary undertakings of the holder of the 32 Contracts to the Obligor. The Owner Trustee, at the written request of a Servicing Officer, shall furnish the Servicer with any powers of attorney or other documents necessary or appropriate in the opinion of the Owner Trustee to enable the Servicer to carry out its servicing and administrative duties hereunder. The Servicer is hereby appointed the servicer hereunder until such time as any Service Transfer may be effected under Article VIII. SECTION 5.02. STANDARD OF CARE. In managing, administering, servicing and making collections on the Contracts pursuant to this Agreement, the Servicer will exercise that degree of skill and care consistent with the skill and care that the Servicer exercises with respect to similar contracts serviced by the Servicer, and, in any event no less degree of skill and care than would be exercised by a prudent servicer of motorcycle conditional sales contracts and promissory note and security agreements; PROVIDED, HOWEVER, that notwithstanding the foregoing, the Servicer shall not release or waive the right to collect the unpaid balance of any Contract except that with respect to a Contract that has become a Defaulted Contract, the Servicer, consistent with its collection policies, may release or waive the right to collect the unpaid balance of such Defaulted Contract in an effort to maximize collections thereon. SECTION 5.03. RECORDS. The Servicer shall, during the period it is servicer hereunder, maintain such books of account and other records as will enable the Owner Trustee and the Indenture Trustee to determine the status of each Contract. SECTION 5.04. INSPECTION. (a) At all times during the term hereof, the Servicer shall afford the Owner Trustee and the Indenture Trustee and their respective authorized agents reasonable access during normal business hours to the Servicer's records relating to the Contracts and will cause its personnel to assist in any examination of such records by the Owner Trustee or the Indenture Trustee, or such authorized agents and allow copies of the same to be made. The examination referred to in this Section will be conducted in a manner which does not unreasonably interfere with the Servicer's normal operations or customer or employee relations. Without otherwise limiting the scope of the examination the Owner Trustee or the Indenture Trustee may, using generally accepted audit procedures, verify the status of each Contract and review the Computer File and records relating thereto for conformity to Monthly Reports prepared pursuant to Article IX and compliance with the standards represented to exist as to each Contract in this Agreement. (b) At all times during the term hereof, the Servicer shall keep available a copy of the List of Contracts at its principal executive office for inspection by the Trustees. SECTION 5.05. TRUST ACCOUNTS. (a) On or before the Closing Date, the Trust Depositor shall establish the Trust Accounts, each with and in the name of the Indenture Trustee for the benefit of the Noteholders. The Indenture Trustee is hereby required to ensure that each of the Trust Accounts is established and maintained as an Eligible Account. (b) The Indenture Trustee shall deposit (or the Servicer shall deposit, with respect to payments by or on behalf of the Obligors received directly by the Servicer), without deposit into 33 any intervening account, into the Collection Account as promptly as practical (but in any case not later than the second Business Day following the receipt thereof): (i) With respect to principal and interest on the Contracts received after the Initial Cutoff Date or Subsequent Cutoff Date, as applicable (which for the purpose of this paragraph (b)(i) shall include those monies in the Lockbox Account allocable to principal and interest on the Contracts), all such amounts received by the Owner Trustee or Servicer; (ii) All Net Liquidation Proceeds related to the Contracts; (iii) The aggregate of the Reacquisition Prices for Contracts reacquired by the Trust Depositor as described in Section 7.08; (iv) All Advances made by the Servicer pursuant to Section 7.03(a); (v) All amounts paid by the Trust Depositor in connection with an optional reacquisition of the Contracts described in Section 7.10; (vi) All amounts realized in respect of Carrying Charges transferred from the Interest Reserve Account as contemplated in Section 7.03(b); and (vii) All amounts received in respect of interest, dividends, gains, income and earnings on investments of funds in the Trust Accounts (except the Reserve Fund and the Pre-Funding Account) as contemplated herein. (c) The Indenture Trustee shall, if amounts remain on deposit in the Pre-Funding Account at the expiration of the Funding Period, cause to be deposited into the Note Distribution Account the amount then in deposit in the Pre-Funding Account. (d) If the Servicer so directs, in writing, the Indenture Trustee shall invest the amounts in the Trust Accounts in Qualified Eligible Investments that are payable on demand or that mature not later than one Business Day prior to the next succeeding Distribution Date. Once such funds are invested, the Indenture Trustee shall not change the investment of such funds. Any loss on such investments shall be deposited in the applicable Trust Account by the Servicer out of its own funds immediately as realized. Funds in the Trust Accounts not so invested must be insured to the extent permitted by law by the Bank Insurance Fund or the Savings Association Insurance Fund of the Federal Deposit Insurance Corporation. Subject to the restrictions herein, the Indenture Trustee may purchase a Qualified Eligible Investment from itself or an Affiliate. Subject to the other provisions hereof, the Indenture Trustee shall have sole control over each such investment and the income thereon, and any certificate or other instrument evidencing any such investment, if any, shall be delivered directly to the Indenture Trustee or its agent, together with each document of transfer, if any, necessary to transfer title to such investment to the Indenture Trustee in a manner which complies with this Section 5.05(d). All interest, dividends, gains upon sale and other income from, or earnings on, investments of funds in the Trust 34 Accounts (other than the Reserve Fund and the Pre-Funding Account) shall be deposited in the Collection Account pursuant to Section 5.05(b) and distributed on the next Distribution Date pursuant to Section 7.05. The Trust Depositor and the Trust agree and acknowledge that the Indenture Trustee is to have "CONTROL" (within the meaning of Section 9-106 of the UCC) of collateral comprised of "INVESTMENT PROPERTY" (within the meaning of Section 9-102 of the UCC) for all purposes of this Agreement. (e) Notwithstanding anything to the contrary herein, the Servicer may remit payments on the Contracts and Net Liquidation Proceeds to the Collection Account in next-day funds or immediately available funds no later than 10:00 a.m., Central time, on the Business Day prior to the next succeeding Distribution Date, but only for so long as the short-term debt security rating of the Servicer is at least "P-1" by Moody's and "A-1" by Standard & Poor's. (f) The Servicer shall apply collections received in respect of a Contract as follows: (i) First, to accrued interest with respect to such Contract; (ii) Second, to pay any expenses and unpaid late charges or extension fees (if any) due and owing under such Contract; and (iii) Third, to principal to the extent due and owing under such Contract. (g) Any collections on a Contract remaining after application by the Servicer in accordance with the provisions of Section 5.05(f) shall constitute an excess payment (an "EXCESS PAYMENT"). Excess Payments constituting prepayments of principal shall be applied as a prepayment of the Principal Balance of such Contract. All other Excess Payments shall be permitted to be retained by the Servicer. (h) The Servicer will, from time to time as provided herein, be permitted to withdraw or request the withdrawal from the Collection Account any amount deposited therein that, based on the Servicer's good-faith determination, was deposited in error. SECTION 5.06. ENFORCEMENT. (a) The Servicer will, consistent with Section 5.02, act with respect to the Contracts in such manner as will maximize the receipt of all payments called for under the terms of the Contracts. The Servicer shall use its best efforts to cause Obligors to make all payments on the Contracts to the Lockbox Account (either directly by remitting payments to the Lockbox, or indirectly by making payments through direct debit, the telephone or the internet to an account of the Servicer which payments will be subsequently transferred from such account to the Lockbox Account). The Servicer will act in a commercially reasonable manner with respect to the repossession and disposition of a Motorcycle following a default under the related Contract with a view to realizing proceeds at least equal to the Motorcycle's fair market value. If the Servicer determines that eventual payment in full of a Contract is unlikely, the Servicer will follow its normal practices and procedures to recover all amounts due upon that Contract, including repossessing and disposing of the related Motorcycle at a public or private sale or taking other action permitted by applicable law. The Servicer will be entitled to recover 35 all reasonable out-of-pocket expenses incurred by it in liquidating a Contract and disposing of the related Motorcycle. (b) The Servicer may sue to enforce or collect upon Contracts, in its own name, if possible, or as agent for the Trustees. If the Servicer elects to commence a legal proceeding to enforce a Contract, the act of commencement shall be deemed to be an automatic assignment of the Contract to the Servicer for purposes of collection only. If, however, in any enforcement suit or legal proceeding it is held that the Servicer may not enforce a Contract on the ground that it is not a real party in interest or a holder entitled to enforce the Contract, the Owner Trustee (or the Indenture Trustee) on behalf of the Trust shall, at the Servicer's expense, take such steps as the Servicer deems reasonably necessary to enforce the Contract, including bringing suit in its name or the names of the Noteholders under the Indenture and the Certificateholder as owner of the Trust. (c) The Servicer shall exercise any rights of recourse against third persons that exist with respect to any Contract in accordance with the Servicer's usual practice. In exercising recourse rights, the Servicer is authorized on the Trust's behalf to reassign the Defaulted Contract or the related Motorcycle to the Person against whom recourse exists at the price set forth in the document creating the recourse; PROVIDED, HOWEVER, the Servicer in exercising recourse against any third persons as described in the immediately preceding sentence shall do so in such manner as to maximize the aggregate recovery with respect to the Contract; and PROVIDED FURTHER, HOWEVER, that notwithstanding the foregoing the Servicer in its capacity as such may exercise such recourse only if such Contract (i) was not required to be reacquired by the Seller pursuant to the Transfer and Sale Agreement or (ii) was required to be reacquired by the Seller and the Seller has defaulted on such reacquisition obligation. (d) The Servicer will not permit any rescission or cancellation of any Contract due to the acts or omissions of the Trust Depositor. (e) The Servicer may grant to the Obligor on any Contract an extension of payments due under such Contract; PROVIDED that (i) the extension period is limited to 45 days, provided that such period may be extended to 62 days on a case-by-case basis (ii) the Obligor has not received an extension during the previous twelve-month period, (iii) the evidence supports the Obligor's willingness and capability to resume monthly payments, (iv) such extension is consistent with the Servicer's customary servicing procedures and is consistent with Section 5.02, (v) such extension does not extend the maturity date of the Contract beyond the latest maturity date of any of the Contracts as of the Initial Cutoff Date (or, if a transfer of Subsequent Contracts to the Trust occurs, beyond the latest maturity date of such Subsequent Contracts) and (vi) the aggregate Principal Balances of Contracts which have had extensions granted does not exceed more than [_____]% of the aggregate of the Initial Class A-1 Note Balance, the Initial Class A-2 Note Balance and the Initial Class B Note Balance. Exceptions to any of clauses (i) through (iv) above may be authorized by the Servicer's management on a case-by-case basis consistent with the Servicer's prudent business practices. 36 (f) The Servicer will not add to the outstanding Principal Balance of any Contract the premium of any physical damage or other individual insurance on a Motorcycle securing such Contract it obtains on behalf of the Obligor under the terms of such Contract, but may create a separate Obligor obligation with respect to such premium if and as provided by the Contract. (g) If the Servicer shall have repossessed a Motorcycle on behalf of the Trust, the Servicer shall either (i) maintain at its expense physical damage insurance with respect to such Motorcycle, or (ii) indemnify the Trust against any damage to such Motorcycle prior to resale or other disposition. The Servicer shall not allow such repossessed Motorcycles to be used in an active trade or business, but rather shall dispose of the Motorcycle in a reasonable time in accordance with the Servicer's normal business practices. SECTION 5.07. TRUSTEES TO COOPERATE. Upon payment in full on any Contract, the Servicer shall (if the Servicer is not then in possession of the Contracts and Contract Files) notify the Trustees and request delivery of the Contract and Contract File to the Servicer. Upon receipt of such notice and request, the Trustees shall promptly release or cause to be released such Contract and Contract File to the Servicer. Upon receipt of such Contract and Contract File, each of the Trust Depositor and the Servicer is authorized to execute an instrument in satisfaction of such Contract and to do such other acts and execute such other documents as the Servicer deems necessary to discharge the Obligor thereunder and eliminate the security interest in the Motorcycle related thereto. The Servicer shall determine when a Contract has been paid in full; to the extent that insufficient payments are received on a Contract credited by the Servicer as prepaid or paid in full and satisfied, the shortfall shall be paid by the Servicer out of its own funds. From time to time as appropriate for servicing and repossession in connection with any Contract, if the Servicer is not then in possession of the Contracts and Contract Files, the Indenture Trustee shall, upon written request of a Servicing Officer and delivery to the Indenture Trustee of a receipt signed by such Servicing Officer, cause the original Contract and the related Contract File to be released to the Servicer and shall execute such documents as the Servicer shall deem reasonably necessary to the prosecution of any such proceedings. Such receipt shall obligate the Servicer to return the original Contract and the related Contract File to the Indenture Trustee when the need by the Servicer has ceased unless the Contract shall be reacquired as described in Section 7.10. Upon request of a Servicing Officer, the Indenture Trustee shall perform such other acts as reasonably requested by the Servicer and otherwise cooperate with the Servicer in the enforcement of the Certificateholder's rights and remedies with respect to Contracts. SECTION 5.08. COSTS AND EXPENSES. All costs and expenses incurred by the Servicer in carrying out its duties hereunder, fees and expenses of accountants and payments of all fees and expenses incurred in connection with the enforcement of Contracts (including enforcement of Defaulted Contracts and repossessions of Motorcycles securing such Contracts when such Contracts are not reacquired pursuant to Section 7.08) and all other fees and expenses not expressly stated hereunder to be for the account of the Trust shall be paid by the Servicer and the Servicer shall not be entitled to reimbursement hereunder. 37 SECTION 5.09. MAINTENANCE OF SECURITY INTERESTS IN MOTORCYCLES. The Servicer shall take such steps as are necessary to maintain continuous perfection and the first priority of the security interest created by each Contract in the related Motorcycle. The Owner Trustee and the Indenture Trustee hereby authorize the Servicer to take such steps as are necessary to perfect such security interest and to maintain the first priority thereof in the event of a relocation of a Motorcycle or for any other reason. SECTION 5.10. SUCCESSOR SERVICER/LOCKBOX AGREEMENTS. The Servicer shall use its best efforts to cause Obligors to make all payments on the Contracts to one or more Lockbox Banks, acting as agent for the Trust pursuant to a Lockbox Agreement. In the event the Servicer shall for any reason no longer be acting as such, the Successor Servicer shall thereupon assume all of the rights and obligations of the outgoing servicer under the Lockbox Agreement; PROVIDED, HOWEVER, that the Successor Servicer shall not be liable for any acts or obligations of the Servicer prior to such succession. In such event, the Successor Servicer shall be deemed to have assumed all of the outgoing Servicer's interest therein and to have replaced the outgoing Servicer as a party to each such Lockbox Agreement to the same extent as if such Lockbox Agreement had been assigned to the Successor Servicer, except that the outgoing Servicer shall not thereby be relieved of any liability or obligations on the part of the outgoing Servicer to the Lockbox Bank under such Lockbox Agreement. The outgoing Servicer shall, upon the request of the Owner Trustee, but at the expense of the outgoing Servicer, deliver to the Successor Servicer all documents and records relating to each such Lockbox Agreement and an accounting of amounts collected and held by the Lockbox Bank and otherwise use its best efforts to effect the orderly and efficient transfer of any Lockbox Agreement to the Successor Servicer. SECTION 5.11. SEPARATE ENTITY EXISTENCE. The Servicer agrees to take or refrain from taking or engaging in with respect to the Trust Depositor, as applicable, each of the actions or activities specified in the "substantive consolidation" opinion of Winston & Strawn LLP (or in any related Certificate of the Servicer) delivered on the Closing Date, upon which the conclusions expressed therein are based. ARTICLE SIX THE TRUST DEPOSITOR SECTION 6.01. COVENANTS OF THE TRUST DEPOSITOR. (a) During the term of this Agreement, the Trust Depositor will keep in full force and effect its existence, rights and franchises as a corporation under the laws of the jurisdiction of its incorporation and will obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Agreement, the other Transaction Documents and each other instrument or agreement necessary or appropriate to the proper administration of this Agreement and the transactions contemplated hereby. 38 (b) ARM'S LENGTH TRANSACTIONS. During the term of this Agreement, all transactions and dealings between the Trust Depositor and its Affiliates will be conducted on an arm's-length basis. (c) NO OTHER BUSINESS. The Trust Depositor shall not engage in any business other than financing, purchasing, owning, selling and managing the Contracts in the manner contemplated by this Agreement and the other Transaction Documents and activities incidental thereto; PROVIDED, HOWEVER, that the Trust Depositor may purchase and transfer (or grant Liens in respect of) contracts and/or other related assets similar to the Contracts to other Persons in securitization or other non-recourse financing transactions involving the Seller or any of its Affiliates (or with respect to the Contract Assets themselves, following a release and reconveyance thereof from the Trust), on terms and conditions (with respect to the liabilities imposed upon the Trust Depositor by virtue of such transactions, as well as in respect of agreements or restrictions concerning activities of the Trust Depositor and its relations or interactions with the Seller or the Servicer or other applicable Affiliate relevant to "bankruptcy remoteness" or "substantive consolidation" analysis), in each case substantially similar to such terms and conditions applicable to the Trust Depositor hereunder and under the other Transaction Documents. (d) NO BORROWING. The Trust Depositor shall not issue, incur, assume, guarantee or otherwise become liable, directly or indirectly, for (i) any Indebtedness except for any Indebtedness permitted by or arising under the Transaction Documents or (ii) obligations in connection with transactions described in the proviso of Section 6.01(c), as limited thereby. The proceeds of the Notes shall be used exclusively to fund the Trust Depositor's purchase of the Contracts and the other assets specified in this Agreement and to pay the transactional expenses of the Trust Depositor. (e) GUARANTEES, LOANS, ADVANCES AND OTHER LIABILITIES. Except as otherwise contemplated by the Transaction Documents or in connection with transactions described in Section 6.01(c), as limited thereby, the Trust Depositor shall not make any loan or advance or credit to, or guarantee (directly or indirectly or by an instrument having the effect of assuming another's payment or performance on any obligation or capability of so doing or otherwise), endorse or otherwise become contingently liable, directly or indirectly, in connection with the obligations, stocks or dividends of, or own, purchase, repurchase or acquire (or agree contingently to do so) any stock, obligations, assets or securities of, any other interest in, or make any capital contribution to, any other Person. (f) CAPITAL EXPENDITURES. The Trust Depositor shall not make any expenditure (by long-term or operating lease or otherwise) for capital assets (either realty or personalty). (g) RESTRICTED PAYMENTS. Except as permitted or contemplated by the Transaction Documents, the Trust Depositor shall not, directly or indirectly, (i) pay any dividend or make any distribution (by reduction of capital or otherwise), whether in cash, property, 39 securities or a combination thereof, to any owner of an equity interest in the Trust Depositor, (ii) redeem, purchase, retire or otherwise acquire for value any such equity interest or (iii) set aside or otherwise segregate any amounts for any such purpose; it being understood that the Trust Depositor shall at all times have the right to distribute funds received pursuant to the Transaction Documents to its equity owner. (h) SEPARATE ENTITY EXISTENCE. The Trust Depositor shall: (i) Maintain its own deposit account or accounts, separate from those of any Affiliate, with commercial banking institutions. The funds of the Trust Depositor will not be diverted to any other Person or for other than authorized uses of the Trust Depositor. (ii) Ensure that, to the extent that it shares the same officers or other employees as any of its members or Affiliates, the salaries of and the expenses related to providing benefits to such officers and other employees shall be fairly allocated among such entities, and each such entity shall bear its fair share of the salary and benefit costs associated with all such common officers and employees. (iii) Ensure that, to the extent that it jointly contracts with any of its members or Affiliates to do business with vendors or service providers or to share overhead expenses, the costs incurred in so doing shall be allocated fairly among such entities, and each such entity shall bear its fair share of such costs. To the extent that the Trust Depositor contracts or does business with vendors or service providers when the goods and services provided are partially for the benefit of any other Person, the costs incurred in so doing shall be fairly allocated to or among such entities for whose benefit the goods and services are provided, and each such entity shall bear its fair share of such costs. All material transactions between Trust Depositor and any of its Affiliates shall be only on an arm's length basis. (iv) To the extent that the Trust Depositor and any of its members or Affiliates have offices in the same location, there shall be a fair and appropriate allocation of overhead costs among them, and each such entity shall bear its fair share of such expenses. (v) Conduct its affairs strictly in accordance with its By-laws and Articles of Incorporation, and observe all necessary, appropriate and customary limited liability company formalities, including, but not limited to, holding all regular and special members' and directors' meetings appropriate to authorize all entity action, keeping separate and accurate records of such meetings and its actions, passing all resolutions or consents necessary to authorize actions taken or to be taken, and maintaining accurate and separate books, records and accounts, including, but not limited to, payroll and intercompany transaction accounts. 40 (vi) Take or refrain from taking or engaging in, as applicable, each of the actions or activities specified in the "true sale" and "substantive consolidation" opinions of Winston & Strawn LLP delivered on the Closing Date (or in any related certificate delivered in connection therewith), upon which the conclusions expressed therein are based. SECTION 6.02. LIABILITY OF TRUST DEPOSITOR; INDEMNITIES. The Trust Depositor shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Trust Depositor under this Agreement. The Trust Depositor shall indemnify, defend and hold harmless the Issuer, the Owner Trustee, [_____], the Indenture Trustee and the Servicer from and against any taxes that may at any time be asserted against any such Person with respect to the transactions contemplated herein and in the other Transaction Documents, including any sales, gross receipts, general corporation, tangible personal property, Illinois personal property replacement privilege or license taxes (but, in the case of the Issuer, not including any taxes asserted with respect to, and as of the date of, the transfer of the Contracts to the Issuer or the issuance and original sale of the Securities, or asserted with respect to ownership of the Contracts, or federal or other income taxes arising out of distributions on the Certificate or the Notes) and costs and expenses in defending against the same. The Trust Depositor shall indemnify, defend and hold harmless the Issuer, the Owner Trustee, [_____], the Indenture Trustee and the Securityholders from and against any loss, liability or expense incurred by reason of the Trust Depositor's willful misfeasance, bad faith or negligence (other than errors in judgment) in the performance of its duties under this Agreement, or by reason of reckless disregard of its obligations and duties under this Agreement. The Trust Depositor shall indemnify, defend and hold harmless the Issuer, the Owner Trustee, [_____] and the Indenture Trustee from and against all costs, expenses, losses, claims, damages and liabilities arising out of or incurred in connection with the acceptance or performance of the trusts and duties herein and, in the case of the Owner Trustee, in the Trust Agreement and, in the case of the Indenture Trustee, in the Indenture, except to the extent that such cost, expense, loss, claim, damage or liability in the case of (i) the Owner Trustee or [_____], as the case may be, shall be due to the willful misfeasance, bad faith or negligence of the Owner Trustee or [_____], as the case may be, or shall arise from the breach by the Owner Trustee or [_____], as the case may be, of any of its representations or warranties set forth in Section 7.03 of the Trust Agreement, or (ii) the Indenture Trustee, shall be due to the willful misfeasance, bad faith or negligence of the Indenture Trustee. The Trust Depositor shall be liable directly to and will indemnify any injured party or any other creditor of the Trust for all losses, claims, damages, liabilities and expenses of the Trust to the extent that Trust Depositor would be liable if the Trust were a partnership under the Delaware Revised Uniform Limited Partnership Act in which Trust Depositor were a general partner; PROVIDED, HOWEVER, that Trust Depositor shall not be liable for any losses incurred by a 41 Certificateholder in the capacity of an investor in the Trust Certificate or a Noteholder in the capacity of an investor in the Notes. In addition, any third party creditors of the Trust (other than in connection with the obligations described in the immediately preceding sentence for which Trust Depositor shall not be liable) shall be deemed third party beneficiaries of this paragraph. The obligations of Trust Depositor under this paragraph shall be evidenced by the Trust Certificate described in the Trust Agreement. Indemnification under this Section shall include, without limitation, reasonable fees and expenses of counsel and expenses of litigation and shall survive the termination of the Trust and the resignation or removal of the Trustees. If the Trust Depositor shall have made any indemnity payments pursuant to this Section and the Person to or on behalf of whom such payments are made thereafter shall collect any of such amounts from others, such Person shall promptly repay such amounts to the Trust Depositor, without interest. Notwithstanding anything to the contrary herein, the obligations of the Trust Depositor under this Section are solely the corporate obligations of the Trust Depositor and shall be payable by it solely as provided in this Section. The Trust Depositor shall only be required to make such contributions required under this Section, (y) from funds available to it pursuant to, and in accordance with the payment priorities set forth in Section 7.05 and (z) only to the extent that it receives additional funds designated for such purposes or to the extent that it has additional funds available (other than funds described in the preceding clause (y)) that would be in excess of amounts that would be necessary to pay the debt and other obligations of such entity incurred in accordance with its certificate of incorporation and all financing documents to which it is a party as they come due. In addition , no amount owing by the Trust Depositor hereunder in excess of the liabilities that it is required to pay in accordance with the preceding sentence shall constitute a "claim" (as defined in Section 101(5) of the Bankruptcy Code) against it. No recourse shall be had for the payment of any amount owing hereunder or any other obligation of, or claim against the Trust Depositor arising out of or based up on this Section against any stockholder, employee, officer, agent, director or authorized person of the Trust Depositor or Affiliate thereof; provided, however, that the foregoing shall not relieve any such person or entity of any liability they might otherwise have as a result of fraudulent actions or omissions taken by them. SECTION 6.03. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, TRUST DEPOSITOR; CERTAIN LIMITATIONS. Notwithstanding any other provision in this Section and any provision of law, the Trust Depositor shall not do any of the following: (a) engage in any business or activity other than as set forth in its Articles of Incorporation; (b) without the affirmative vote of a majority of the members of the Board of Directors of the Trust Depositor (which must include the affirmative vote of at least two duly appointed Independent directors) (i) dissolve or liquidate, in whole or in part, or institute proceedings to be adjudicated bankrupt or insolvent, (ii) consent to the 42 institution of bankruptcy or insolvency proceedings against it, (iii) file a petition seeking or consent to reorganization or relief under any applicable federal or state law relating to bankruptcy, (iv) consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the corporation or a substantial part of its property, (v) make a general assignment for the benefit of creditors, (vi) admit in writing its inability to pay its debts generally as they become due, or (vii) take any corporate action in furtherance of the actions set forth in clauses (i) through (vi) above; PROVIDED, HOWEVER, that no director may be required by any shareholder of the Trust Depositor to consent to the institution of bankruptcy or insolvency proceedings against the Trust Depositor so long as it is solvent; or (c) merge or consolidate with any other corporation, company or entity or sell all or substantially all of its assets or acquire all or substantially all of the assets or capital stock or other ownership interest of any other corporation, company or entity unless the Person formed by such consolidation or into which the Trust Depositor has merged or the Person which acquires by conveyance, transfer or lease substantially all the assets of the Trust Depositor as an entirety, can lawfully perform the obligations of the Trust Depositor hereunder and executes and delivers to the Owner Trustee and the Indenture Trustee an agreement in form and substance reasonably satisfactory to the Owner Trustee and the Indenture Trustee which contains an assumption by such successor entity of the due and punctual performance and observance of each covenant and condition to be performed or observed by the Trust Depositor under this Agreement; PROVIDED that the Trust Depositor shall provide notice of any merger, consolidation or succession pursuant to this Section to each Rating Agency and shall receive from each Rating Agency a letter to the effect that such merger, consolidation or succession will not result in a qualification, downgrading or withdrawal of the then-current ratings of each Class of Notes. SECTION 6.04. LIMITATION ON LIABILITY OF TRUST DEPOSITOR AND OTHERS. The Trust Depositor and any director or officer or employee or agent of the Trust Depositor may rely in good faith on any document of any kind, prima facie properly executed and submitted by any Person respecting any matters arising hereunder. The Trust Depositor and any director or officer or employee or agent of the Trust Depositor shall be reimbursed by the Owner Trustee or the Indenture Trustee, as the case may be, for any contractual damages, liability or expense incurred by reason of the Owner Trustee's or the Indenture Trustee's willful misfeasance, bad faith or negligence (except errors in judgment) in the performance of their respective duties hereunder, or by reason of reckless disregard of their respective obligations and duties hereunder. The Trust Depositor shall not be under any obligation to appear in, prosecute or defend any legal action that shall not be incidental to its obligations under this Agreement, and that in its opinion may involve it in any expense or liability. SECTION 6.05. TRUST DEPOSITOR NOT TO RESIGN. Subject to the provisions of Section 6.03, the Trust Depositor shall not resign from the obligations and duties hereby imposed on it as Trust Depositor hereunder. 43 ARTICLE SEVEN DISTRIBUTIONS; RESERVE FUND SECTION 7.01. MONTHLY DISTRIBUTIONS. (a) Each Noteholder and Certificateholder as of the related Record Date shall be paid on the next succeeding Distribution Date by check mailed to such Noteholder or Certificateholder at the address for such Noteholder or Certificateholder appearing on the Note Register or Certificate Register or by wire transfer if such Noteholder or Certificateholder provides written instructions to the Indenture Trustee or the Owner Trustee, respectively, at least ten days prior to such Distribution Date. (b) The Indenture Trustee shall serve as the paying agent hereunder (the "PAYING AGENT") and shall make the payments to or on behalf of the Noteholders and the Certificateholder required hereunder. The Indenture Trustee hereby agrees that all amounts held by it for payment hereunder will be held in trust for the benefit of the Noteholders and the Certificateholder. SECTION 7.02. FEES. The Indenture Trustee shall be paid the Indenture Trustee Fee and the Servicer shall be paid the Monthly Servicing Fee, each of which shall be paid solely from the monies and in accordance with the priorities described in Section 7.05(a). No recourse may be had to the Seller, Trust Depositor, Trustees, Servicer, or any of their respective Affiliates in the event that amounts available under Section 7.05(a) are insufficient for payment of the Indenture Trustee's Fee and the Monthly Servicing Fee. SECTION 7.03. ADVANCES; REALIZATION OF CARRYING CHARGE. (a) On each Determination Date, the Servicer shall compute the amount of Delinquent Interest, if any, on the Contracts for the immediately preceding Due Period. Not later than each Distribution Date, the Servicer shall advance (each, an "ADVANCE") an amount equal to the Delinquent Interest for such Determination Date by depositing such amount in the Collection Account; PROVIDED, HOWEVER, that the Servicer shall be obligated to advance Delinquent Interest only to the extent that the Servicer, in its sole discretion, expects that such advance will not become an Uncollectible Advance. The Servicer shall indicate on each Monthly Report (i) the amount of Delinquent Interest, if any, on the Contracts for the related Due Period and (ii) the amount of the Advance, if any, made by the Servicer in respect of the Delinquent Interest pursuant to this Section 7.03. If the amount of such Advance is less than the amount of the Delinquent Interest, the relevant Monthly Report shall be accompanied by a certificate of a Servicing Officer setting forth in reasonable detail the basis for the determination by the Servicer that the portion of the Delinquent Interest not advanced would become an Uncollectible Advance. By each Determination Date, the Servicer shall determine the amount of prior unreimbursed Advances for which it shall be entitled to be reimbursed pursuant to the provisions of this Section (such amount, the "REIMBURSEMENT AMOUNT"). The Servicer shall be entitled to be reimbursed for any outstanding Advance with respect to a Contract by means of a first priority withdrawal from the Collection Account of such Reimbursement Amount as provided in Section 7.05(a)(ii). 44 (b) The Servicer shall determine no later than 11:00 a.m., Chicago, Illinois time, on the second Business Day prior to a Distribution Date the Carrying Charges in respect of the upcoming Distribution Date. To the extent of such amount, the Indenture Trustee shall transfer an amount equal to the Carrying Charges from the Interest Reserve Account (solely to the extent of the amount then on deposit in such account) into the Collection Account as contemplated in Section 5.05(b)(vi) hereof. SECTION 7.04. INTEREST RESERVE ACCOUNT. (a) On or prior to the Closing Date, the Trust Depositor shall establish with and in the name of the Indenture Trustee on behalf of the Securityholders, an Eligible Account designated "HARLEY-DAVIDSON CUSTOMER FUNDING CORP. INTEREST RESERVE ACCOUNT - HARLEY DAVIDSON MOTORCYCLE TRUST [_____] - [_____], AS INDENTURE TRUSTEE" (such account being the "INTEREST RESERVE ACCOUNT"). (b) No withdrawals may be made of funds in the Interest Reserve Account except as provided in (c) below. Except as specifically provided, funds in the Interest Reserve Account shall not be commingled with funds in any other account established with respect to the Notes, the Certificate or with any other monies. (c) All investment earnings realized in respect of amounts in the Pre-Funding Account shall be deposited when and as received in the Interest Reserve Account, such that the Pre-Funded Amount shall never exceed the amount initially deposited into the Pre-Funding Account on the Closing Date. With respect to amounts on deposit in the Interest Reserve Account, the Indenture Trustee shall disburse from such funds the amount specified in respect of Carrying Charges in accordance with Section 7.03 herein. In the event that (i) the Funding Period has terminated, (ii) all amounts on deposit in the Pre-Funding Account have been disbursed, (iii) a Distribution Date has elapsed following the occurrence of both (i) and (ii), and (iv) all amounts referred to in clause (ii) have been applied, then any amounts remaining in the Interest Reserve Account shall be allocated and distributed to the Trust Depositor. SECTION 7.05. DISTRIBUTIONS; PRIORITIES. (a) Except as provided in Section 7.05(b) or (c), on each Distribution Date, the Indenture Trustee, at the Servicer's direction, will make the following allocations and distributions of Available Monies in the following order of priority: (i) to the Mandatory Redemption Subaccount in the Note Distribution Account to the Noteholders, the amount of any Mandatory Redemption, PRO RATA (based on the outstanding principal amount of each Class of Notes), calculated on the then current principal balance of the Notes with the amounts derived from draws on the Pre-Funding Account (which amounts are available for payment of such Mandatory Redemptions and not for any other purpose); PROVIDED, HOWEVER, in the event the amount in the Mandatory Redemption subaccount is less than $150,000 such amount shall be distributed solely to the Class A-1 Noteholders; 45 (ii) to the Servicer, the Reimbursement Amount to the Servicer for Advances previously made; (iii) to the Servicer, the Servicing Fee, including any unpaid Servicing Fee with respect to one or more prior Due Periods; (iv) to the Indenture Trustee, any accrued and unpaid Indenture Trustee Fee with respect to one or more prior Due Periods; (v) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, the Note Interest Distributable Amount with respect to such Distribution Date for each Class of Notes allocated in the following order of priority: (1) to the Class A-1 Noteholders and to the Class A-2 Noteholders, the Note Interest Distributable Amount for each such Class of Notes; PROVIDED, HOWEVER, that if there are insufficient funds on deposit in the Note Distribution Account to pay the entire amount of the Note Interest Distributable Amount for each such Class of Notes, then the amount in the Note Distribution Account shall be applied to the Class A-1 Notes and the Class A-2 Notes PRO RATA on the basis of the Note Interest Distributable Amount for each such Class of Notes; and (2) to the Class B Noteholders, the Note Interest Distributable Amount for such Class of Notes; (vi) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, the Class A Note Principal Distributable Amount with respect to such Distribution Date, first, to the Class A-1 Notes until the Class A-1 Notes have been paid in full, and second, to the Class A-2 Notes until the Class A-2 Notes have been paid in full; (vii) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, the Class B Note Principal Distributable Amount to the Class B Notes until the Class B Notes have been paid in full; (viii) any Excess Amounts to the Reserve Fund up to the Specified Reserve Fund Balance; and (ix) to the Holder of the Certificate. (b) If the Notes have been declared immediately due and payable as provided in Section 5.02 of the Indenture following the occurrence of an Event of Default under Section 5.01(iii) of the Indenture, then, until such time as the Notes have been paid in full, Available Monies shall be allocated and distributed in the following order of priority after payment of the amounts set forth in Section 7.05(a)(i), (ii), (iii) and (iv): 46 (i) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, the Note Interest Distributable Amount with respect to such Distribution Date for each Class of Notes allocated in the following order of priority: (1) to the Class A-1 Noteholders and to the Class A-2 Noteholders, the Note Interest Distributable Amount for each such Class of Notes; PROVIDED, HOWEVER, that if there are insufficient funds on deposit in the Note Distribution Account to pay the entire amount of the Note Interest Distributable Amount for each such Class of Notes, then the amount in the Note Distribution Account shall be applied to the Class A-1 Notes and the Class A-2 Notes PRO RATA on the basis of the Note Interest Distributable Amount for each such Class; and (2) to the Class B Noteholders, the Note Interest Distributable Amount for such Class of Notes; (ii) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, all amounts remaining after distribution of interest to each Class of Notes shall be allocated in the following order of priority: (1) to the Class A Notes, PRO RATA (based on outstanding principal amount), until the outstanding principal balance of each Class of the Class A Notes has been reduced to zero; and (2) to the Class B Notes, until the outstanding principal balance of the Class B Notes has been reduced to zero; and (iii) to the Holder of the Certificate. (c) If the Notes have been declared immediately due and payable as provided in Section 5.02 of the Indenture following the occurrence of an Event of Default under Section 5.01(i), (ii), (iv) or (v) of the Indenture, then, until such time as the Notes have been paid in full, Available Monies shall be allocated and distributed in the following order of priority after payment of amounts set forth in Section 7.05(a)(i), (ii), (iii) and (iv): (i) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, the Note Interest Distributable Amount with respect to such Distribution Date for distribution to the Class A-1 Noteholders and to the Class A-2 Noteholders, as applicable; PROVIDED, HOWEVER, that if there are insufficient funds on deposit in the Note Distribution Account to pay the entire amount of the Note Interest Distributable Amount for each such Class of Notes, then the amount in the Note Distribution Account shall be applied to the Class A-1 Notes and the Class A-2 Notes PRO RATA (on the basis of the Note Interest Distributable Amount for each such Class); 47 (ii) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, the Class A Note Principal Distributable Amount for distribution to the Class A-1 Noteholders and the Class A-2 Noteholders in reduction of the outstanding principal amount of the Class A-1 Notes and Class A-2 Notes, as applicable, until the outstanding principal balance of the Class A-1 Notes and the Class A-2 Notes has been reduced to zero; provided, however, that if there are insufficient funds on deposit in the Note Distribution Account to reduce the outstanding principal balance of the Class A-1 Notes and the Class A-2 Notes to zero, the amount in the Note Distribution Account shall be applied to the payment of principal on the Class A-1 Notes and the Class A-2 Notes PRO RATA (based on outstanding principal amount); (iii) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, the Note Interest Distributable Amount with respect to such Distribution Date for distribution to the Class B Noteholders; (iv) to the Note Distribution Account, together with any amounts deposited therein pursuant to Section 7.06, the Class B Note Principal Distributable Amount with respect to such Distribution Date for distribution to the Class B Noteholders in reduction of the outstanding principal amount of the Class B Notes until the outstanding principal balance of the Class B Notes has been reduced to zero; and (v) to the Holder of the Certificate. SECTION 7.06. RESERVE FUND. (a) On or prior to the Closing Date, the Indenture Trustee, on behalf of the Trust Depositor shall deposit the Reserve Fund Initial Deposit into the Reserve Fund from the net proceeds of the Securities. (b) The Indenture Trustee shall determine no later than 10:00 a.m., Chicago, Illinois time, on the Distribution Date (but after making, and taking into account, the determination, demand and transfer of funds contemplated in Section 7.05 above) whether there exists a Shortfall with respect to the upcoming Distribution Date. In the event that the Indenture Trustee determines that there exists a Shortfall, the Indenture Trustee shall no later than 12:00 noon, Chicago, Illinois time, on such Distribution Date remit monies from the Reserve Fund in the following order of priority: first, to the Note Distribution Account, the amount of such Shortfall relating to the Note Interest Distributable Amount and second, to the Note Distribution Account, the amount of such Shortfall relating to the Note Principal Distributable Amount. (c) The Indenture Trustee shall at the written direction of the Servicer invest the funds in the Reserve Fund in Qualified Eligible Investments. Funds in the Reserve Fund shall be invested in investments that are payable on demand or mature on or before the Business Day prior to each Distribution Date. Once such funds are invested, the Indenture Trustee shall not change the investment of such funds prior to maturity. Upon any such investment, the Indenture Trustee shall, consistent with the definition of Qualified Eligible Investment herein, make an 48 appropriate notation of the security interest in such Qualified Eligible Investment on the Indenture Trustee's records, by book entry or otherwise. All income and gain realized from any such investments as well as any interest earned on Reserve Fund Deposits shall be deposited and retained in the Reserve Fund (subject to Section 7.06(e)). Losses, if any, realized on amounts in the Reserve Fund invested pursuant to this paragraph shall first be credited against undistributed investment earnings on amounts in the Reserve Fund invested pursuant to this paragraph, and shall thereafter be deemed to reduce the amount on deposit in the Reserve Fund. Neither the Trust Depositor nor the Indenture Trustee shall be liable for the amount of any loss incurred in respect of any investment, or lack of investment, of funds held in the Reserve Fund. All income or loss on funds held in the Reserve Fund shall be taxable to the Trust Depositor. (d) Any Excess Amounts will be applied to the Specified Reserve Fund Balance. (e) On each Distribution Date on which the amount on deposit in the Reserve Fund (after giving effect to all deposits thereto and withdrawals therefrom on such Distribution Date) is greater than the Specified Reserve Fund Balance, the Indenture Trustee shall release its lien on any remaining amounts to the Trust Depositor. SECTION 7.07. ESTABLISHMENT OF PRE-FUNDING ACCOUNT. (a) On or prior to the Closing Date, the Trust Depositor shall establish with and in the name of the Indenture Trustee on behalf of the Securityholders, an Eligible Account designated "HARLEY-DAVIDSON CUSTOMER FUNDING CORP. PRE-FUNDING ACCOUNT - HARLEY DAVIDSON MOTORCYCLE TRUST [_____] - [_____], AS INDENTURE TRUSTEE" (such account being the "PRE-FUNDING ACCOUNT"). (b) During the Funding Period, following receipt from the Trust Depositor of an Addition Notice, and upon further receipt of a written demand from the Trust Depositor for a disbursement of funds from the Pre-Funding Account to be made on or before the date on which the Funding Period terminates (which written demand must be delivered not later than one Business Day prior to the requested date of funding and must be accompanied by the written consent of the Indenture Trustee), the Indenture Trustee will disburse the amount demanded from the Pre-Funding Account to the Seller upon the order of the Trust Depositor for the purpose of purchasing Subsequent Contracts from the Seller pursuant to a Subsequent Purchase Agreement. With respect to amounts still remaining on deposit in the Pre-Funding Account on the date upon which the Funding Period ends (and provided a timely written demand for funding as described above has not been received requesting funding on such date) the Indenture Trustee shall immediately transfer all funds remaining in the Pre-Funding Account to the Note Distribution Account. (c) If (x) the Pre-Funded Amount has not been reduced to zero on the Distribution Date on which the Funding Period ends (or, if the Funding Period does not end on a Distribution Date, on the first Distribution Date following the end of the Funding Period) or (y) the Pre-Funded Amount has been reduced to $150,000 or less on any Determination Date, in either case 49 after giving effect to any reductions in the Pre-Funded Amount on such Distribution Date or Determination Date pursuant to paragraph (a) above, the Trust Depositor shall instruct the Indenture Trustee to withdraw from the Pre-Funding Account the Pre-Funded Amount and, in the case of (x), on such Distribution Date or, on the Determination Date (i) if the Pre-Funded Amount is less than $150,000, deposit the Pre-Funded Amount in the Note Distribution Account for payment as principal of the Class A-1 Notes up to the Outstanding Amount thereof and then for payment of principal of the Class A-2 Notes and Class B Notes and (ii) if the Pre-Funded Amount is equal to or greater than $150,000, deposit the Pre-Funded Amount in the Note Distribution Account for payment as principal of the Notes, pro rata, calculated on the then current principal balance of each Class of Notes. SECTION 7.08. REACQUISITION OF CONTRACTS FOR BREACH OF REPRESENTATIONS AND WARRANTIES. Upon a discovery by the Servicer, the Trust Depositor or the Trustees of a breach of a representation or warranty of the Seller as set forth in EXHIBIT J hereto or as made in any Subsequent Purchase Agreement relating to Subsequent Contracts that materially adversely affects the Trust's interest in such Contract (without regard to the benefits of the Reserve Fund), the party discovering the breach shall give prompt written notice to the other parties; PROVIDED, that the Trustees shall have no duty or obligation to inquire or to investigate the breach by the Seller of any of such representations or warranties. The Seller, as provided in the Transfer and Sale Agreement and in accordance with this Section 7.08, shall reacquire a Contract at its Reacquisition Price, two Business Days prior to the first Determination Date after the Seller becomes aware, or should have become aware, or receives written notice from the Trustees, the Servicer or the Trust Depositor of any breach of a representation or warranty of the Seller set forth in Article III of the Transfer and Sale Agreement that materially and adversely affects such Contract or the Trust's interest in such Contract and which breach has not been cured; PROVIDED, HOWEVER, that with respect to any Contract described on the List of Contracts with respect to an incorrect unpaid Principal Balance which the Seller would otherwise be required to reacquire under the Transfer and Sale Agreement, the Seller may, in lieu of reacquiring such Contract, deposit in the Collection Account not later than one Business Day after such Determination Date cash in an amount sufficient to cure any deficiency or discrepancy; and PROVIDED FURTHER that with respect to a breach of representation or warranty relating to the Contracts in the aggregate and not to any particular Contract the Seller may select Contracts (without adverse selection) to reacquire such that had such Contracts not been included as part of the Trust Corpus there would have been no breach of such representation or warranty; PROVIDED FURTHER that the failure to maintain perfection of the security interest in the Motorcycle securing a Contract in accordance with Section 5.09, shall be deemed to be a breach materially and adversely affecting the Trust's interest in the Contract or in the related Contracts. Notwithstanding any other provision of this Agreement, the obligation of the Seller under the Transfer and Sale Agreement and described in this Section 7.08 shall not terminate or be deemed released by any party hereto upon a Service Transfer pursuant to Article VIII. The reacquisition obligation described in this Section 7.08 is in no way to be satisfied with monies in the Reserve Fund. 50 SECTION 7.09. REASSIGNMENT OF REACQUIRED CONTRACTS. Upon receipt by the Indenture Trustee for deposit in the Collection Account of the Reacquisition Price as described in Section 7.08 or Section 7.10, and upon receipt of a certificate of a Servicing Officer in the form attached hereto as EXHIBIT G, the Indenture Trustee shall release its lien on and the Trust shall assign to the Seller all of the Trust's right, title and interest in the reacquired Contract without recourse, representation or warranty, except as to the absence of liens, charges or encumbrances created by or arising as a result of actions of the Trustees. SECTION 7.10. SELLER'S REACQUISITION OPTION. As provided in the Transfer and Sale Agreement, on written notice to the Owner Trustee and Indenture Trustee at least 20 days prior to a Distribution Date, and provided that the Pool Balance is then less than 10% of the sum of the Pool Balance as of the Initial Cutoff Date plus the Pre-Funded Amount as of the Closing Date, the Seller may (but is not required to) purchase on that Distribution Date all outstanding Contracts (and related Contract Assets) at a price equal to the aggregate unpaid principal balance of the Notes on the previous Distribution Date plus the aggregate of the Note Interest Distributable Amount for the current Distribution Date, the Reimbursement Amount (if any) as well as accrued and unpaid Monthly Servicing Fees and the Indenture Trustee Fee to the date of such reacquisition. Such price shall be deposited in the Collection Account not later than one (1) Business Day before such Distribution Date, against the Owner Trustee's and Indenture Trustee's release of the Contracts and the Contract Files to the Seller. ARTICLE EIGHT EVENTS OF TERMINATION; SERVICE TRANSFER SECTION 8.01. EVENTS OF TERMINATION. "Event of Termination" means the occurrence of any of the following: (a) Any failure by the Servicer or the Seller to make any payment or deposit required to be made hereunder or in the Transfer and Sale Agreement (or in any Subsequent Purchase Agreement or Subsequent Transfer Agreement) and the continuance of such failure for a period of four Business Days after the date on which such payment or deposit was due; (b) Failure on the Servicer's or the Seller's part to observe or perform in any material respect any covenant or agreement in this Agreement or in the Transfer and Sale Agreement (or in any Subsequent Purchase Agreement or Subsequent Transfer Agreement) (other than a covenant or agreement, the breach of which is specifically addressed elsewhere in this Section) which continues unremedied for 30 days after the date on which such failure commences; (c) Any assignment by the Servicer or the Seller of its duties or rights hereunder or under the Transfer and Sale Agreement (or under any Subsequent Purchase Agreement or Subsequent Transfer Agreement), except as specifically permitted hereunder or thereunder, or any attempt to make such an assignment; 51 (d) An involuntary case under any applicable bankruptcy, insolvency or other similar law shall have been commenced in respect of the Servicer or Trust Depositor and shall not have been dismissed within 90 days, or a court having jurisdiction in the premises shall have entered a decree or order for relief in respect of either the Servicer or Trust Depositor in an involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of either the Servicer or Trust Depositor, or for any substantial liquidation or winding up of their respective affairs; (e) The Servicer or Trust Depositor shall have commenced a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or shall have consented to the entry of an order for relief in an involuntary case under any such law, or shall have consented to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian or sequestrator (or other similar official) of the Servicer or Trust Depositor, as the case may be, or for any substantial part of their respective property, or shall have made any general assignment for the benefit of their respective creditors, or shall have failed to, or admitted in writing its inability to, pay its debts as they become due, or shall have taken any corporate action in furtherance of the foregoing; (f) Any failure by the Servicer to deliver to the Trustees the Monthly Report pursuant to the terms of this Agreement which remains uncured for five Business Days after the date which such failure commences; (g) Any representation, warranty or statement of the Servicer made in this Agreement, in any Subsequent Transfer Agreement or any certificate, report or other writing delivered pursuant hereto shall prove to be incorrect in any material respect as of the time when the same shall have been made and the incorrectness of such representation, warranty or statement has a material adverse effect on the Trust and, within 30 days after written notice thereof shall have been given to the Servicer or the Trust Depositor by the Indenture Trustee, the circumstances or condition in respect of which such representation, warranty or statement was incorrect shall not have been eliminated or otherwise cured. SECTION 8.02. WAIVER OF EVENT OF TERMINATION. The Required Noteholders may, by written notice delivered to the parties hereto, waive any Event of Termination other than an Event of Termination described in Section 8.01(a). SECTION 8.03. SERVICE TRANSFER. (a) If an Event of Termination has occurred and is continuing and has not been waived pursuant to Section 8.02, (x) the Required Holders or (y) the Indenture Trustee may, by written notice delivered to the parties hereto, terminate all (but not less than all) of the Servicer's management, administrative, servicing, custodial and collection functions hereunder (such termination being herein called a "SERVICE TRANSFER"). (b) Upon receipt of the notice required by Section 8.03(a) (or, if later, on a date designated therein), all rights, benefits, fees, indemnities, authority and power of the Servicer 52 under this Agreement, whether with respect to the Contracts, the Contract Files or otherwise, shall pass to and be vested in the Indenture Trustee (the "SUCCESSOR SERVICER") pursuant to and under this Section 8.03; and, without limitation, the Successor Servicer is authorized and empowered to execute and deliver on behalf of the Servicer, as attorney-in-fact or otherwise, any and all documents and other instruments, and to do any and all acts or things necessary or appropriate to effect the purposes of such notice of termination. The Servicer agrees to cooperate with the Successor Servicer in effecting the termination of the responsibilities and rights of the Servicer hereunder, including, without limitation, the transfer to the Successor Servicer for administration by it of all cash amounts which shall at the time be held by the Servicer for deposit, or have been deposited by the Servicer, in the Collection Account, or for its own account in connection with its services hereafter or thereafter received with respect to the Contracts. The Servicer shall transfer to the Successor Servicer all records held by the Servicer relating to the Contracts in such electronic form as the Successor Servicer may reasonably request and (ii) any Contract Files in the Servicer's possession. In addition, the Servicer shall permit access to its premises (including all computer records and programs) to the Successor Servicer or its designee, and shall pay the reasonable transition expenses of the Successor Servicer. Upon a Service Transfer, the Successor Servicer shall also be entitled to receive the Monthly Servicing Fee for performing the obligations of the Servicer. SECTION 8.04. SUCCESSOR SERVICER TO ACT; APPOINTMENT OF SUCCESSOR SERVICER. On or after a Service Transfer pursuant to Section 8.03, the Successor Servicer shall be the successor in all respects to the Servicer in its capacity as servicer under this Agreement and the transactions set forth or provided for herein and shall be subject to all the responsibilities, duties and liabilities relating thereto placed on the Servicer by the terms and provisions hereof, and the terminated Servicer shall be relieved of such responsibilities, duties and liabilities arising after such Service Transfer; PROVIDED, HOWEVER, that (i) the Successor Servicer will not assume any obligations of the Servicer described in Section 8.08 and (ii) the Successor Servicer shall not be liable for any acts or omissions of the Servicer occurring prior to such Service Transfer or for any breach by the Servicer of any of its representations and warranties contained herein or in any related document or agreement. Notwithstanding the above, if the Successor Servicer is legally unable or unwilling to act as Servicer, the Required Holders may appoint a successor servicer (other than the original Servicer or an Affiliate of the original Servicer) to act as Servicer. As compensation therefor, the successor servicer shall be entitled to receive reasonable compensation equal to the Monthly Servicing Fee. The Owner Trustee, Noteholders and the Indenture Trustee and such successor shall take such action, consistent with this Agreement, as shall be necessary to effectuate any such succession. To the extent the terminated Servicer has made Advances, it shall be entitled to reimbursement of the same notwithstanding its termination hereunder, to the same extent as if it had continued to service the Contracts hereunder. SECTION 8.05. NOTIFICATION TO SECURITYHOLDERS. (a) Promptly following the occurrence of any Event of Termination, the Servicer shall give written notice thereof to the Trustees, the Trust Depositor and each Rating Agency at the addresses described in Section 11.04 hereof and to the Noteholders at their respective addresses appearing on the Note Register. 53 (b) Within 10 days following any termination or appointment of a Successor Servicer pursuant to this Article VIII, the Indenture Trustee shall give written notice thereof to each Rating Agency and the Trust Depositor at the addresses described in Section 11.04 hereof, and to the Noteholders at their addresses appearing on the Note Register. SECTION 8.06. EFFECT OF TRANSFER. (a) After a Service Transfer, the terminated Servicer shall have no further obligations with respect to the management, administration, servicing, custody or collection of the Contracts and the Successor Servicer appointed pursuant to Section 8.04 shall have all of such obligations, except that the terminated Servicer will transmit or cause to be transmitted directly to the Successor Servicer for its own account, promptly on receipt and in the same form in which received, any amounts (properly endorsed where required for the Successor Servicer to collect them) received as payments upon or otherwise in connection with the Contracts. (b) A Service Transfer shall not affect the rights and duties of the parties hereunder (including but not limited to the indemnities of the Servicer) other than those relating to the management, administration, servicing, custody or collection of the Contracts. SECTION 8.07. DATABASE FILE. The Servicer will provide the Successor Servicer with a magnetic tape (in a format reasonably acceptable to the Indenture Trustee and the Servicer) containing the database file for each Contract (i) as of the Initial Cutoff Date, (ii) the Subsequent Cutoff Date, (iii) thereafter, as of the last day of the preceding Due Period on each Determination Date prior to a Service Transfer and (iv) on and as of the Business Day before the actual commencement of servicing functions by the Successor Servicer following the occurrence of a Service Transfer. SECTION 8.08. SUCCESSOR SERVICER INDEMNIFICATION. The Servicer shall defend, indemnify and hold the Successor Servicer and any officers, directors, employees or agents of the Successor Servicer harmless against any and all claims, losses, penalties, fines, forfeitures, legal fees and related costs, judgments and any other costs, fees, and expenses that the Successor Servicer may sustain in connection with the claims asserted at any time by third parties against the Successor Servicer which result from (i) any willful or grossly negligent act taken or omission by the Servicer or (ii) a breach of any representations of the Servicer in Section 3.02 hereof. The indemnification provided by this Section 8.08 shall survive the termination of this Agreement. SECTION 8.09. RESPONSIBILITIES OF THE SUCCESSOR SERVICER. The Successor Servicer will not be responsible for delays attributable to the Servicer's failure to deliver information, defects in the information supplied by the Servicer or other circumstances beyond the control of the Successor Servicer. The Successor Servicer will make arrangements with the Servicer for the prompt and safe transfer of, and the Servicer shall provide to the Successor Servicer, all necessary servicing files and records, including (as deemed necessary by the Successor Servicer at such time): (i) 54 microfiche loan documentation, (ii) servicing system tapes, (iii) Contract payment history, (iv) collections history and (v) the trial balances, as of the close of business on the day immediately preceding conversion to the Successor Servicer, reflecting all applicable loan information. The Successor Servicer shall have no responsibility and shall not be in default hereunder nor incur any liability for any failure, error, malfunction or any delay in carrying out any of its duties under this Agreement if any such failure or delay results from the Successor Servicer acting in accordance with information prepared or supplied by a Person other than the Successor Servicer or the failure of any such Person to prepare or provide such information. The Successor Servicer shall have no responsibility, shall not be in default and shall incur no liability (i) for any act or failure to act by any third party, including the Servicer, the Trust Depositor or the Trustees or for any inaccuracy or omission in a notice or communication received by the Successor Servicer from any third party or (ii) which is due to or results from the invalidity, unenforceability of any Contract with applicable law or the breach or the inaccuracy of any representation or warranty made with respect to any Contract. SECTION 8.10. LIMITATION OF LIABILITY OF SERVICER. (a) Neither the Servicer nor any of the directors, officers, employees or agents of the Servicer shall be under any liability to the Trust, the Owner Trustee, the Indenture Trustee or the Noteholders, except as provided under this Agreement, for any action taken or for refraining from the taking of any action pursuant to this Agreement or for errors in judgment; PROVIDED, HOWEVER, that this provision shall not protect the Servicer or any such person against any liability that would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of reckless disregard of obligations and duties under this Agreement. The Servicer and any director, officer, employee or agent of the Servicer may rely in good faith on the advice of counsel or on any document of any kind, prima facie properly executed and submitted by any Person respecting any matters arising under this Agreement. (b) Except as provided in this Agreement, the Servicer shall not be under any obligation to appear in, prosecute or defend any legal action that shall not be incidental to its duties to service the Contracts in accordance with this Agreement, and that in its opinion may cause it to incur any expense or liability; PROVIDED, HOWEVER, that the Servicer may undertake any reasonable action that it may deem necessary or desirable in respect of the Transaction Documents and the rights and duties of the parties to the Transaction Documents and the interests of the Noteholders under the Indenture. In such event, the legal expenses and costs of such action and any liability resulting therefrom shall be expenses, costs and liabilities of the Servicer and the Servicer will not be entitled to be reimbursed therefor. SECTION 8.11. MERGER OR CONSOLIDATION OF SERVICER. Any Person into which the Servicer may be merged or consolidated, or any corporation, or other entity resulting from any merger conversion or consolidation to which the Servicer shall be a party, or any Person succeeding to all or substantially all of the business of the Servicer (which Person assumes the obligations of the Servicer), shall be the successor of the Servicer hereunder, without the execution or filing of any paper or any further act on the part of any of the parties hereto, 55 anything herein to the contrary notwithstanding. The Servicer shall give prior written notice of any such merger or consolidation to which it is a party to the Issuer, the Owner Trustee, the Indenture Trustee and the Rating Agencies. SECTION 8.12. SERVICER NOT TO RESIGN. Subject to the provisions of Section 8.03, Servicer shall not resign from the obligations and duties hereby imposed on it as Servicer under this Agreement except upon determination that the performance of its duties under this Agreement shall no longer be permissible under applicable law. Notice of any such determination permitting the resignation of Servicer shall be communicated to the Owner Trustee and the Indenture Trustee at the earliest practicable time (and, if such communication is not in writing, shall be confirmed in writing at the earliest practicable time) and any such determination shall be evidenced by an Opinion of Counsel to such effect delivered to the Owner Trustee and the Indenture Trustee concurrently with or promptly after such notice. No such resignation shall become effective until the Indenture Trustee shall have assumed the responsibilities and rights of the predecessor Servicer in accordance with Section 8.04. SECTION 8.13. APPOINTMENT OF SUBSERVICER. So long as Harley-Davidson Credit Corp. acts as the Servicer, the Servicer may at any time without notice or consent perform specific duties as servicer under this Agreement through other subcontractors; PROVIDED, HOWEVER, that, in each case, no such delegation or subcontracting shall relieve the Servicer of its responsibilities with respect to such duties as to which the Servicer shall remain primarily responsible with respect thereto. ARTICLE NINE REPORTS SECTION 9.01. MONTHLY REPORTS. No later than 10:00 a.m., Chicago, Illinois time, two Business Days prior to each Distribution Date, the Servicer shall cause the Trustees and each Rating Agency to receive a Monthly Report. SECTION 9.02. OFFICER'S CERTIFICATE. Each Monthly Report delivered pursuant to Section 9.01 shall be accompanied by a certificate of a Servicing Officer substantially in the form of EXHIBIT C, certifying the accuracy of the Monthly Report and that no Event of Termination or event that with notice or lapse of time or both would become an Event of Termination has occurred, or if such event has occurred and is continuing, specifying the event and its status. SECTION 9.03. OTHER DATA. In addition, the Trust Depositor and the Servicer shall, upon the request of the Trustees, Moody's or Standard & Poor's, furnish the Trustees, Moody's or Standard & Poor's, as the case may be, such underlying data as may be reasonably requested. SECTION 9.04. ANNUAL REPORT OF ACCOUNTANTS. 56 (a) The Servicer shall cause a firm of nationally recognized independent certified public accountants (the "INDEPENDENT ACCOUNTANTS"), who may also render other services to the Servicer, Harley-Davidson Financial or to the Trust Depositor, to deliver to the Trustees, the Underwriters and each Rating Agency, on or before March 31 (or 90 days after the end of the Servicer's fiscal year, if other than December 31) of each year, beginning on [_____], with respect to the twelve months ended the immediately preceding December 31 (or other applicable date), a statement (the "ACCOUNTANT'S REPORT") addressed to the Board of Directors of the Servicer and to the Trustees to the effect that such firm has audited the financial statements of Harley-Davidson Financial and issued its report thereon and that such audit: (1) was made in accordance with generally accepted auditing standards, and accordingly included such tests of the accounting records and such other auditing procedures as such firm considered necessary in the circumstances; (2) included an examination of documents and records relating to the servicing of motorcycle conditional sales contracts and promissory note and security agreements under pooling and servicing agreements substantially similar to one another (such statement to have attached thereto a schedule setting forth the pooling and servicing agreements covered thereby, including this Agreement); (3) included an examination of the delinquency and loss statistics relating to Harley-Davidson Financial's portfolio of motorcycle conditional sales contracts and promissory notes and security agreements; and (4) except as described in the statement, disclosed no exceptions or errors in the records relating to motorcycle loans serviced for others that, in the firm's opinion, generally accepted auditing standards requires such firm to report. The Accountant's Report shall further state that: (1) a review in accordance with agreed upon procedures was made of one randomly selected Monthly Report; and (2) except as disclosed in the Report, no exceptions or errors in the Monthly Report so examined were found. (b) The Accountant's Report shall also indicate that the firm is independent of Harley-Davidson Financial within the meaning of the Code of Professional Ethics of the American Institute of Certified Public Accountants. (c) In the event the Independent Accountants require the Indenture Trustee to agree to the procedures performed by such firm, the Servicer shall direct the Indenture Trustee in writing to so agree; it being understood and agreed that the Indenture Trustee will deliver such letter of agreement in conclusive reliance upon the direction of the Servicer, and the Indenture Trustee 57 shall not make any independent inquiry or investigation as to, and shall have no obligation or liability in respect of, the sufficiency, validity or correctness of such procedures. SECTION 9.05. ANNUAL STATEMENT OF COMPLIANCE FROM SERVICER. The Servicer will deliver to the Trustees, the Underwriters and each of the Rating Agencies, on or before January 31 of each year commencing [_____], an Officer's Certificate stating that (a) a review of the activities of the Servicer during the prior calendar year and of its performance under this Agreement was made under the supervision of the officer signing such certificate and (b) to such officer's knowledge, based on such review, the Servicer has fully performed all its obligations under this Agreement, or, if there has been a default in the performance of any such obligation, specifying each such default known to such officer and the nature and status thereof. A copy of such certificate may be obtained (i) by any Noteholder by a request in writing to the Indenture Trustee and (ii) by any Certificateholder by a request in writing to the Owner Trustee. SECTION 9.06. MONTHLY REPORTS TO NOTEHOLDERS. (a) On or before two Business Days prior to each Distribution Date, the Servicer shall prepare and, concurrently with each distribution to Noteholders pursuant to Article VII, deliver to the Indenture Trustee, in its capacity as Note Registrar and Paying Agent, shall cause to be delivered and mailed to each Noteholder at the addresses appearing on the Note Register a statement as of the related Distribution Date substantially in the form of EXHIBIT I hereto (the "MONTHLY REPORT") setting forth: (i) the amount of Noteholder's principal distribution; (ii) the amount of Noteholder's interest distribution; (iii) the amount of fees payable out of the Trust, separately identifying the Monthly Servicing Fee and the Indenture Trustee Fee; (iv) the amount of any Note Interest Carryover Shortfall and Note Principal Carryover Shortfall on such Distribution Date and the change in such amounts from those with respect to the immediately preceding Distribution Date; (v) the Note Pool Factor for each Class of Notes, in each case of such Distribution Date; (vi) the amount of the distributions described in (i) or (ii) above payable pursuant to a claim on the Reserve Fund or from any other source not constituting Available Monies and the amount remaining in the Reserve Fund after giving effect to all deposits and withdrawals from the Reserve Fund on such date; (vii) the amount of any Mandatory Redemption to be made on such Distribution Date; 58 (viii) for each Distribution Date during the Funding Period, the remaining Pre-Funded Amount; (ix) for each Distribution Date during the Funding Period to and including the Distribution Date immediately following the end of the Funding Period, the Principal Balance and number of Subsequent Contracts conveyed to the Trust during the related Due Period; (x) the remaining Principal Balance after giving effect to the distribution of principal (and Mandatory Redemption, if any) to each class of Notes to be made on such Distribution Date; (xi) the number and aggregate principal balance of Contracts delinquent 30-59 days, 60-89 days and 90 or more days, computed as of the end of the related Due Period; (xii) the number and aggregate principal balance of Contracts that became Liquidated Contracts during the immediately preceding Due Period, the amount of liquidation proceeds for such Due Period, the amount of liquidation expenses being deducted from liquidation proceeds for such Due Period, the Net Liquidation Proceeds and the Net Liquidation Losses for such Due Period; (xiii) the Loss Ratio, Average Loss Ratio, Cumulative Loss Ratio, the Delinquency Ratio and the Average Delinquency Ratio as of such Distribution Date; (xiv) the number of Contracts and the aggregate Principal Balance of such Contracts, as of the first day of the Due Period relating to such Distribution Date (after giving effect to payments received during such Due Period and to any transfers of Subsequent Contracts to the Trust occurring on or prior to such Distribution Date); (xv) the aggregate Principal Balance and number of Contracts that were reacquired by the Seller pursuant to the Agreement with respect to the related Due Period, identifying the Reacquisition Price for such Contracts; (xvi) the amount otherwise distributable on the Class B Notes that has instead been distributed to one or more senior Classes of Notes on such Distribution Date; (xvii) the amount of Advances made by the Servicer in respect of the related Contracts and the related Due Period and the amount of unreimbursed Advances in respect of the related Contracts determined by the Servicer to be Defaulted Contracts; and (xviii) such other customary factual information as is available to the Servicer as the Servicer deems necessary and can reasonably obtain from its existing data base to enable the Noteholders and the Certificateholder to prepare their tax returns. 59 (b) Within the prescribed period of time for tax reporting purposes after the end of each calendar year, the Servicer shall prepare and the Note Registrar shall mail to each Noteholder of record at any time during such year a report as to the aggregate amounts reported pursuant to subsections (i), (ii), (iii) and (iv) of this Section, attributable to such Noteholder. (c) The Indenture Trustee shall send the Monthly Report to (i) the initial Clearing Agency under the Note Depository Agreement or any qualified successor appointed pursuant to Section 2.11 of the Indenture and (ii) each Securityholder or party to this Agreement. ARTICLE TEN TERMINATION SECTION 10.01. SALE OF TRUST ASSETS. (a) [Intentionally Omitted]. (b) As described in Article Nine of the Trust Agreement, notice of any termination of the Trust shall be given by the Servicer to the Owner Trustee and the Indenture Trustee as soon as practicable after the Servicer has received notice thereof. (c) Following the satisfaction and discharge of the Indenture and the payment in full of the principal of and interest on the Notes, the Certificateholder will succeed to the rights of the Noteholders hereunder and the Owner Trustee will succeed to the rights of, and assume the obligations of, the Indenture Trustee pursuant to this Agreement. ARTICLE ELEVEN MISCELLANEOUS SECTION 11.01. AMENDMENT. (a) This Agreement may be amended by the Trust Depositor, the Servicer, the Indenture Trustee and the Owner Trustee on behalf of the Issuer, collectively, without the consent of any Securityholders, (i) to cure any ambiguity, to correct or supplement any provisions in this Agreement which are inconsistent with the provisions herein or in the Prospectus, or to add any other provisions with respect to matters or questions arising under this Agreement that shall not be inconsistent with the provisions of this Agreement or the Prospectus, (ii) to add or provide any credit enhancement for any Class of Notes and (iii) to change any provision applicable for determining the Specified Reserve Fund Balance or the manner in which the Reserve Fund is funded; PROVIDED, HOWEVER that any such action shall not, as evidenced by an Opinion of Counsel, adversely affect in any material respect the interests of any Securityholder and provided, further, that in connection with any amendment pursuant to clause (iii) above, the 60 Servicer shall deliver to the Owner Trustee and the Indenture Trustee a letter from Standard & Poor's (so long as Standard & Poor's is a Rating Agency) and Moody's (so long as Moody's is a Rating Agency) to the effect that such amendment will not cause its then-current rating on any Class of Notes to be qualified, reduced or withdrawn. (b) This Agreement may also be amended from time to time by the Trust Depositor, the Servicer, the Indenture Trustee and the Owner Trustee on behalf of the Issuer, with the consent of the Required Holders, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders or the Certificateholder; PROVIDED, HOWEVER, that no such amendment shall increase or reduce in any manner the amount of, or accelerate or delay the timing of (i)(a) collections of payments on the Contracts or distributions that shall be required to be made on any Note or any Interest Rate, (b) except as otherwise provided in Section 11.01(a), the Specified Reserve Fund Balance or the manner in which the Reserve Fund is funded or (ii) reduce the aforesaid percentage of the Outstanding Amount of the Notes, the Holders of which are required to consent to any such amendment, without the consent of the Holders of all Notes of the relevant Class then outstanding and the Certificate. (c) Prior to the execution of any such amendment or consent, the Indenture Trustee shall furnish written notification of the substance of such amendment or consent, together with a copy thereof, to each Rating Agency. (d) Promptly after the execution of any such amendment or consent, the Owner Trustee and the Indenture Trustee, as the case may be, shall furnish written notification of the substance of such amendment or consent to each Noteholder. It shall not be necessary for the consent of Noteholders pursuant to Section 11.01(b) to approve the particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof. The manner of obtaining such consents and of evidencing the authorization by Noteholders of the execution thereof shall be subject to such reasonable requirements as the Owner Trustee or the Indenture Trustee may prescribe. (e) Prior to the execution of any amendment to this Agreement, the Owner Trustee and the Indenture Trustee shall be entitled to receive and rely upon an Opinion of Counsel stating that the execution of such amendment is authorized or permitted by this Agreement. The Owner Trustee and the Indenture Trustee may, but shall not be obligated to, enter into any such amendment which affects the Owner Trustee's or the Indenture Trustee's own rights, duties or immunities under this Agreement or otherwise. (f) Notwithstanding anything to the contrary in this Section 11.01, the Trust Depositor or the Servicer, acting on behalf of the Trust Depositor, may request each Rating Agency to approve a formula for determining the Specified Reserve Fund Balance that is different from the formula or result determined from the current definition thereof contained herein so as to result in a decrease in the amount of the Specified Reserve Fund Balance or the manner by which such Reserve Fund is funded. If each Rating Agency delivers to the Indenture 61 Trustee and Owner Trustee a written notice or letter stating that such action will not result in a reduction or withdrawal of the rating of any outstanding Class with respect to which a Rating Agency has previously issued a rating as a result or such action, then the Specified Reserve Fund Balance will be theretofore determined in accordance with such changed formula or manner of funding, and an amendment to this Agreement effecting such change may be executed without the consent of any Securityholder. SECTION 11.02. PROTECTION OF TITLE TO TRUST. (a) The Servicer shall file such financing statements and cause to be filed such continuation statements, all in such manner and in such places as may be required by law fully to preserve, maintain and protect the interest of the Issuer, the Securityholders and the Indenture Trustee in the Contracts and in the proceeds thereof. The Servicer shall deliver (or cause to be delivered) to the Owner Trustee and the Indenture Trustee file-stamped copies of, or filing receipts for, any document filed as provided above, as soon as available following such filing. The Trust Depositor authorizes the Trust to file financing statements describing the Trust Corpus as collateral. (b) Neither the Seller, the Trust Depositor nor the Servicer shall change its name, identity or corporate structure in any manner that would, could or might make any financing statement or continuation statement filed in accordance with Section 4.02 seriously misleading within the meaning of Section 9-507 of the UCC, unless it shall have given the Issuer, the Owner Trustee and the Indenture Trustee at least 30 days' prior written notice thereof and shall have promptly filed appropriate amendments to all previously filed financing statements or continuation statements. (c) The Seller and the Trust Depositor shall give the Issuer, the Owner Trustee and the Indenture Trustee at least 30 days' prior written notice of any change in its state of incorporation. The Servicer shall at all times maintain each office from which it shall service Contracts, and its principal executive office, within the United States. (d) The Servicer shall maintain or cause to be maintained accounts and records as to each Contract accurately and in sufficient detail to permit (i) the reader thereof to know at any time the status of such Contract, including payments and recoveries made and payments owing (and the nature of each) and (ii) reconciliation between payments or recoveries on (or with respect to) each Contract and the amounts from time to time deposited in or credited to the Collection Account in respect of each Contract. (e) The Servicer shall maintain or cause to be maintained its computer systems so that, from and after the time of transfer under this Agreement of the Contracts, the Servicer's master computer records (including any backup archives) that shall refer to a Contract indicate clearly the interest of the Issuer and the Indenture Trustee in such Contract and that such Contract is owned by the Issuer and has been pledged to the Indenture Trustee. Indication of the Issuer's ownership of and the Indenture Trustee's interest in a Contract shall be deleted from or 62 modified on the Servicer's computer systems when, and only when, the related Contract shall have been paid in full or reacquired or shall have become a Liquidated Contract. (f) If at any time the Trust Depositor or the Servicer shall propose to sell, grant a security interest in, or otherwise transfer any interest in motorcycle conditional sales contracts or promissory note and security agreements to any prospective purchaser, lender or other transferee, the Servicer shall give or cause to be given to such prospective purchaser, lender or other transferee computer tapes, records or print-outs (including any restored from back-up archives) that, if they shall refer in any manner whatsoever to any Contract, shall indicate clearly that such Contract has been transferred and is owned by the Issuer and has been pledged to the Indenture Trustee. (g) The Servicer shall permit the Owner Trustee and its agents, at any time during normal business hours, to inspect, audit and make copies of and abstracts from the Servicer's records regarding any Contract. (h) Upon request, the Servicer shall furnish to the Owner Trustee and the Indenture Trustee, within five Business Days, a list of all Contracts then held as part of the Trust Estate, together with a reconciliation of such list to the List of Contracts and to each of the Monthly Reports furnished before such request indicating removal of Contracts from the Trust. (i) The Servicer shall deliver to the Owner Trustee, the Indenture Trustee and each Rating Agency promptly after the execution and delivery of this Agreement and of each amendment hereto, an Opinion of Counsel either (A) stating that, in the opinion of such counsel, all financing statements and continuation statements have been executed and filed that are necessary fully to preserve and protect the interest of the Owner Trustee and the Indenture Trustee and reciting the details of each filings or referring to prior Opinions of Counsel in which such details are given, or (B) stating that, in the opinion of such counsel, no such action shall be necessary to preserve and protect such interest. SECTION 11.03. GOVERNING LAW. This Agreement shall be construed in accordance with the laws of the State of Illinois and the obligations, rights, and remedies of the parties under the Agreement shall be determined in accordance with such laws, except that the duties of the Owner Trustee shall be governed by the laws of the State of Delaware. SECTION 11.04. NOTICES. All notices, demands, certificates, requests and communications hereunder ("notices") shall be in writing and shall be effective (a) upon receipt when sent through the U.S. mails, registered or certified mail, return receipt requested, postage prepaid, with such receipt to be effective the date of delivery indicated on the return receipt, or (b) one Business Day after delivery to an overnight courier, or (c) on the date personally delivered to an Authorized Officer of the party to which sent, or (d) on the date transmitted by legible telecopier transmission with a confirmation of receipt, in all cases addressed to the recipient as follows: (i) If to the Servicer or Seller: 63 Harley-Davidson Credit Corp. 150 South Wacker Drive, Suite 3100 Chicago, Illinois 60606 Attention: Perry A. Glassgow Telecopier No.: (312) 368-4372 (ii) If to the Trust Depositor: Harley-Davidson Customer Funding Corp. 3850 Arrowhead Drive Carson City, Nevada 89706 Attention: Perry A. Glassgow Telecopier No.: (775) 886-3490 with a copy to: Harley-Davidson Credit Corp. 150 South Wacker Drive, Suite 3100 Chicago, Illinois 60606 Attention: Perry A. Glassgow Telecopier No.: (312) 368-4372 (iii) If to the Indenture Trustee: [_______________] [_______________] [_______________] [_______________] Attention: [________________] Telecopier No.: [________________] (iv) If to the Owner Trustee: [_______________] [_______________] [_______________] [_______________] Attention: [________________] Telecopier No.: [________________] (v) If to Moody's: 64 Moody's Investors Service, Inc. 99 Church Street New York, New York 10007 Attention: ABS Monitoring Department Telecopier No.: (212) 553-1350 (vi) If to Standard & Poor's: Standard & Poor's Ratings Services, a division of The McGraw Hill Companies 55 Water Street New York, New York 10004 Telecopier No.: (212) 438-2657 (vii) If to the Underwriters: [_______________] [_______________] [_______________] [_______________] Attention: [________________] Telecopier No.: [________________] [other Underwriters] Each party hereto may, by notice given in accordance herewith to each of the other parties hereto, designate any further or different address to which subsequent notices shall be sent. SECTION 11.05. SEVERABILITY OF PROVISIONS. If one or more of the covenants, agreements, provisions or terms of this Agreement shall be for any reason whatsoever held invalid, then such covenants, agreements, provisions or terms shall be deemed severable from the remaining covenants, agreements, provisions or terms of this Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement or of the Notes or the Certificate or the rights of the Holders thereof. SECTION 11.06. ASSIGNMENT. Notwithstanding anything to the contrary contained herein, as provided in Sections 6.03 and 8.03, this Agreement may not be assigned by the Trust Depositor or the Servicer without the prior written consent of Securityholders aggregating not less than 66-2/3% of each Class. SECTION 11.07. THIRD PARTY BENEFICIARIES. Except as otherwise specifically provided herein, the parties hereto hereby manifest their intent that no third party shall be deemed a third 65 party beneficiary of this Agreement, and specifically that the Obligors are not third party beneficiaries of this Agreement. SECTION 11.08. COUNTERPARTS. This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall together constitute but one and the same instrument. SECTION 11.09. HEADINGS. The headings of the various Articles and Sections herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof. SECTION 11.10. NO BANKRUPTCY PETITION; DISCLAIMER AND SUBORDINATION. (a) Each of the Seller, the Indenture Trustee, the Servicer, the Owner Trustee and each Holder (by acceptance of the applicable Securities) covenants and agrees that, prior to the date that is one year and one day after the payment in full of all amounts owing in respect of all outstanding Securities, it will not institute against the Trust Depositor, or the Trust, or join any other Person in instituting against the Trust Depositor or the Trust, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceedings under the laws of the United States or any state of the United States. This Section 11.10 will survive the termination of this Agreement. (b) The Trust acknowledges and agrees that the Certificate represents a beneficial interest in the Trust and Trust Corpus only and the Securities do not represent an interest in any assets (other than the Trust Corpus) of the Trust Depositor (including by virtue of any deficiency claim in respect of obligations not paid or otherwise satisfied from the Trust Assets and proceeds thereof). In furtherance of and not in derogation of the foregoing, to the extent that the Trust Depositor enters into other securitization transactions, the Trust acknowledges and agrees that it shall have no right, title or interest in or to any assets (or interests therein) other than the Trust Assets conveyed or purported to be conveyed (whether by way of a sale, capital contribution or by the granting of a Lien) by the Trust Depositor to any Person other than the Trust (the "OTHER ASSETS"). To the extent that notwithstanding the agreements contained in this Section, the Trust or any Securityholder, either (i) asserts an interest in or claim to, or benefit from any Other Assets, whether asserted against or through the Trust Depositor or any other Person owned by the Trust Depositor, or (ii) is deemed to have any interest, claim or benefit in or from any Other Assets, whether by operation of law, legal process, pursuant to applicable provisions of Insolvency Laws or otherwise (including without limitation pursuant to Section 1111(b) of the federal Bankruptcy Code, as amended) and whether deemed asserted against or through the Trust Depositor or any other Person owned by the Trust Depositor, then the Trust and each Securityholder by accepting a Note or Certificate further acknowledges and agrees that any such interest, claim or benefit in or from the Other Assets is and shall be expressly subordinated to the indefeasible payment in full of all obligations and liabilities of the Trust Depositor which, under the terms of the documents relating to the securitization of the Other Assets, are entitled to be paid from, entitled 66 to the benefits of, or otherwise secured by such Other Assets (whether or not any such entitlement or security interest is legally perfected or otherwise entitled to a priority of distribution under applicable law, including Insolvency Laws, and whether asserted against the Trust Depositor or any other Person owned by the Trust Depositor) including, without limitation, the payment of post-petition interest on such other obligations and liabilities. This subordination agreement shall be deemed a subordination agreement within the meaning of Section 510(a) of the Bankruptcy Code. Each Securityholder is deemed to have acknowledged and agreed that no adequate remedy at law exists for a breach of this Section 11.10 and that the terms and provisions of this Section 11.10 may be enforced by an action for specific performance. (c) The provisions of this Section 11.10 shall be for the third party benefit of those entitled to rely thereon and shall survive the termination of this Agreement. SECTION 11.11. LIMITATION OF LIABILITY OF OWNER TRUSTEE AND INDENTURE TRUSTEE. (a) Notwithstanding anything contained herein to the contrary, this Agreement has been executed by [_____], not in its individual capacity but solely in its capacity as Owner Trustee of the Issuer, and in no event shall [_____] in its individual capacity or any beneficial owner of the Issuer have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder, as to all of which recourse shall be had solely to the assets of the Issuer. For all purposes of this Agreement, in the performance of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles Six, Seven and Eight of the Trust Agreement. (b) Notwithstanding anything contained herein to the contrary, this Agreement has been executed by [_____], not in its individual capacity but solely as Indenture Trustee, and in no event shall [_____] have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder or in any of the certificates, notices or agreements delivered pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuer. [signature page follows] 67 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers as of the day and year first above written. HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] By: [_____], not in its individual capacity but solely as Owner Trustee on behalf of the Trust By: ------------------------------------------- Printed Name: Title: HARLEY-DAVIDSON CUSTOMER FUNDING CORP., as Trust Depositor By: ------------------------------------------- Printed Name: Title: HARLEY-DAVIDSON CREDIT CORP., as Servicer By: ------------------------------------------- Printed Name: Title: [_____], not in its individual capacity but solely as Indenture Trustee By: ------------------------------------------- Printed Name: Title: SIGNATURE PAGE TO SALE AND SERVICING AGREEMENT EXHIBIT A [Form of Assignment] In accordance with the Sale and Servicing Agreement (the "SALE AND SERVICING AGREEMENT") dated as of [_____] made by and between the undersigned, as Trust Depositor ("TRUST DEPOSITOR"), Harley-Davidson Credit Corp., as Servicer ("HDCC"), [_____], as Indenture Trustee and Harley-Davidson Motorcycle Trust [_____] (the "TRUST"), as assignee thereunder, the undersigned does hereby sell, transfer, convey and assign, set over and otherwise convey to the Trust (i) all the right, title and interest of the Trust Depositor in and to the Initial Contracts listed on the initial List of Contracts delivered on the Closing Date (including, without limitation, all security interests and all rights to receive payments which are collected pursuant thereto after the Initial Cutoff Date, including any liquidation proceeds therefrom, but excluding any rights to receive payments which were collected pursuant thereto on or prior to the Initial Cutoff Date), (ii) all rights of the Trust Depositor under any physical damage or other individual insurance policy (and rights under a "FORCED PLACED" policy, if any), any debt insurance policy or any debt cancellation agreement relating to any such Contract, an Obligor or a Motorcycle securing such Contract, (iii) all security interests in each such Motorcycle, (iv) all documents contained in the related Contract Files, (v) all rights (but not the obligations) of the Trust Depositor under any related motorcycle dealer agreements between dealers (i.e., the originators of certain Contracts) and HDCC, (vi) all rights of the Trust Depositor in the Lockbox, the Lockbox Account and related Lockbox Agreement to the extent they relate to such Contracts, (vii) all rights (but not the obligations) of the Trust Depositor under the Transfer and Sale Agreement, including but not limited to the Trust Depositor's rights under Article V thereof, (viii) the remittances, deposits and payments made into the Trust Accounts from time to time and amounts in the Trust Accounts from time to time (and any investments of such amounts), (ix) all rights of the Trust Depositor to certain rebates of premiums and other amounts relating to insurance policies, debt cancellation agreements, extended service contracts or other repair agreements and other items financed under such Contracts, and (x) all proceeds and products of the foregoing. This Assignment is made pursuant to and in reliance upon the representation and warranties on the part of the undersigned contained in Article III of the Agreement and no others. Capitalized terms used herein but not otherwise defined shall have the meanings assigned to such terms in the Agreement. IN WITNESS WHEREOF, the undersigned has caused this Assignment to be duly executed this _____ day of [_____]. HARLEY-DAVIDSON CUSTOMER FUNDING CORP. By: ------------------------------------------- Printed Name: Title: A-1 EXHIBIT B [Form of Closing Certificate of Trust Depositor] HARLEY-DAVIDSON CUSTOMER FUNDING CORP. OFFICER'S CERTIFICATE The undersigned certifies that he is [_____] of Harley-Davidson Customer Funding Corp., a Nevada corporation (the "TRUST DEPOSITOR"), and that as such is duly authorized to execute and deliver this certificate on behalf of the Trust Depositor in connection with the Sale and Servicing Agreement (the "AGREEMENT") dated as of [_____] (the "EFFECTIVE DATE") by and among the Trust Depositor, [_____] (the "INDENTURE TRUSTEE"), as Indenture Trustee, Harley-Davidson Credit Corp. ("HARLEY-DAVIDSON CREDIT"), as Servicer, and Harley-Davidson Motorcycle Trust [_____] ("ISSUER") (all capitalized terms used herein without definition have the respective meanings set forth in the Agreement), and further certifies as follows: (1) Attached hereto as EXHIBIT I is a true and correct copy of the Articles of Incorporation of the Trust Depositor, together with all amendments thereto as in effect on the date hereof. (2) There has been no other amendment or other document filed affecting the Articles of Incorporation of the Trust Depositor since [_____], and no such amendment has been authorized by the Board of Directors or shareholders of the Trust Depositor. (3) Attached hereto as EXHIBIT II is a Certificate of the Secretary of State of the State of Nevada dated [_________] stating that the Trust Depositor is duly incorporated under the laws of the State of Nevada and is in good standing. (4) Attached hereto as EXHIBIT III is a true and correct copy of the By-laws of the Trust Depositor, which are in full force and effect on the date hereof. (5) Attached hereto as EXHIBIT IV is a true and correct copy of resolutions adopted pursuant to the unanimous written consent of the Board of Directors of the Trust Depositor relating to the execution, delivery and performance of the Agreement; the Transfer and Sale Agreement dated as of the Effective Date between the Trust Depositor and Harley-Davidson Credit; the Trust Agreement dated as of [_____] between the Trust Depositor and [_____] (the "Owner Trustee"), as Owner Trustee; the Administration Agreement dated as of the Effective Date between the Trust Depositor, the Issuer, the Indenture Trustee, Harley-Davidson Credit, as Administrator; the Underwriting Agreement dated [_____] among the Trust Depositor, Harley-Davidson Credit and the Underwriters (collectively, the "PROGRAM AGREEMENTS"). Said resolutions have not been amended, modified, annulled or revoked, and are on the date hereof in full force and B-1 effect and are the only resolutions relating to these matters which have been adopted by the Board of Directors. (6) No event with respect to the Trust Depositor has occurred and is continuing which would constitute an Event of Termination or an event that, with notice or the passage of time or both, would become an Event of Termination under the Agreement. To the best of my knowledge after reasonable investigation, there has been no material adverse change in the condition, financial or otherwise, or the earnings, business affairs or business prospects of the Trust Depositor, whether or not arising in the ordinary course of business since the respective dates as of which information is given in the Prospectus and except as set forth therein. (7) All federal, state and local taxes of the Trust Depositor due and owing as of the date hereof have been paid. (8) All representations and warranties of the Trust Depositor contained in the Program Agreements or any other related documents, or in any document, certificate or financial or other statement delivered in connection therewith are true and correct as of the date hereof. (9) There is no action, investigation or proceeding pending or, to our knowledge, threatened against the Trust Depositor before any court, administrative agency or other tribunal (a) asserting the invalidity of the Program Agreements; (b) seeking to prevent the consummation of any of the transactions contemplated by the Program Agreements; or (c) which is likely materially and adversely to affect the Trust Depositor's performance of its obligations under, or the validity or enforceability of, the Program Agreements. (10) No consent, approval, authorization or order of, and no notice to or filing with, any governmental agency or body or state or federal court is required to be obtained by the Trust Depositor for the Trust Depositor's consummation of the transactions contemplated by the Program Agreements, except such as have been obtained or made and such as may be required under the blue sky laws of any jurisdiction in connection with the issuance and sale of the Certificate. (11) The Trust Depositor is not a party to any agreements or instruments evidencing or governing indebtedness for money borrowed or by which the Trust Depositor or its property is bound (other than the Program Agreements). Neither Harley-Davidson Credit's transfer and assignment of the Contract Assets to the Trust Depositor, the Trust Depositor's concurrent transfer and assignment of the Trust Corpus to the Trust, nor the concurrent pledge of the Collateral by the Trust to the Indenture Trustee nor the issuance and sale of the Certificate and the Notes, nor the execution and delivery of the Program Agreements, nor the consummation of any other of the transactions B-2 contemplated therein, will violate or conflict with any agreement or instrument to which the Trust Depositor is a party or by which it is otherwise bound. (12) In connection with the transfer of Contracts and related collateral contemplated in the Agreement, (a) the Trust Depositor has not made such transfer with actual intent to hinder, delay or defraud any creditor of the Trust Depositor, and (b) the Trust Depositor has not received less than a reasonably equivalent value in exchange for such transfer, is not on the date thereof insolvent (nor will become insolvent as a result thereof), is not engaged (or about to engage) in a business or transaction for which it has unreasonably small capital, and does not intend to incur or believe it will incur debts beyond its ability to pay when matured. (13) Each of the agreements and conditions of the Trust Depositor to be performed on or before the Closing Date pursuant to the Program Agreements have been performed in all material respects. * * * * B-3 IN WITNESS WHEREOF, I have affixed my signature hereto this ___ day of [_____]. By: ------------------------------------------- Printed Name: Title: EXHIBIT C [Form of Closing Certificate of Servicer/Seller] HARLEY-DAVIDSON CREDIT CORP. OFFICER'S CERTIFICATE The undersigned certifies that he is [_____] of Harley-Davidson Credit Corp. ("HARLEY-DAVIDSON CREDIT"), and that as such is duly authorized to execute and deliver this certificate on behalf of Harley-Davidson Credit, as Servicer, in connection with the Sale and Servicing Agreement (the "SALE AND SERVICING AGREEMENT") dated as of [_____] (the "EFFECTIVE DATE") by and among Harley-Davidson Credit, as Servicer, Harley-Davidson Customer Funding Corp. ("CFC"), [_____], as Indenture Trustee and Harley-Davidson Motorcycle Trust [_____] ("ISSUER"), in connection with the Transfer and Sale Agreement dated as of the Effective Date (the "TRANSFER AND SALE AGREEMENT") by and between Harley-Davidson Credit and CFC (all capitalized terms used herein without definition having the respective meanings set forth in the Sale and Servicing Agreement), and further certifies as follows: (1) Attached hereto as EXHIBIT I is a true and correct copy of the Articles of Incorporation of Harley-Davidson Credit, together with all amendments thereto as in effect on the date hereof. (2) There has been no other amendment or other document filed affecting the Articles of Incorporation of Harley-Davidson Credit since [_____], and no such amendment has been authorized by the Board of Directors or shareholders of Harley-Davidson Credit. (3) Attached hereto as EXHIBIT II is a Certificate of the Secretary of State of the State of Nevada dated [_________] stating that Harley-Davidson Credit is duly incorporated under the laws of the State of Nevada and is in good standing. (4) Attached hereto as EXHIBIT III is a true and correct copy of the By-laws of Harley-Davidson Credit which were in full force and effect as of [_____] and at all times subsequent thereto. (5) Attached hereto as EXHIBIT IV is a true and correct copy of resolutions adopted pursuant to a unanimous written consent of the Board of Directors of Harley-Davidson Credit and relating to the authorization, execution, delivery and performance of the Transfer and Sale Agreement; the Sale and Servicing Agreement; the Underwriting Agreement dated [_____] among Harley-Davidson Credit, CFC and the Underwriters (the "UNDERWRITING AGREEMENT"); and the Administration Agreement dated as of the Effective Date among Harley-Davidson Credit, CFC, the Issuer and [_____], as Indenture C-1 Trustee (the "INDENTURE TRUSTEE") (the "ADMINISTRATION AGREEMENT"). Said resolutions have not been amended, modified, annulled or revoked, and are on the date hereof in full force and effect and are the only resolutions relating to these matters which have been adopted by the Board of Directors. (6) No event with respect to Harley-Davidson Credit has occurred and is continuing which would constitute an Event of Termination or an event that, with notice or the passage of time, would constitute an Event of Termination under the Sale and Servicing Agreement. To the best of my knowledge after reasonable investigation, there has been no material adverse change in the condition, financial or otherwise, or the earnings, business affairs or business prospects of Harley-Davidson Credit, whether or not arising in the ordinary course of business, since the respective dates as of which information is given in the Prospectus and except as set forth therein. (7) All federal, state and local taxes of Harley-Davidson Credit due and owing as of the date hereof have been paid. (8) All representations and warranties of Harley-Davidson Credit contained in the Transfer and Sale Agreement, the Sale and Servicing Agreement, the Underwriting Agreement and the Administration Agreement (collectively, the "PROGRAM AGREEMENTS") or in any document, certificate or financial or other statement delivered in connection therewith are true and correct as of the date hereof. (9) There is no action, investigation or proceeding pending or, to my knowledge, threatened against Harley-Davidson Credit before any court, administrative agency or other tribunal (a) asserting the invalidity of any Program Agreement to which Harley-Davidson Credit is a party; or (b) which is likely materially and adversely to affect Harley-Davidson Credit's performance of its obligations under, or the validity or enforceability of, the Program Agreements. (10) No consent, approval, authorization or order of, and no notice to or filing with, any governmental agency or body or state or federal court is required to be obtained by Harley-Davidson Credit for Harley-Davidson Credit's consummation of the transactions contemplated by the Program Agreements, except such as have been obtained or made and such as may be required under the blue sky laws of any jurisdiction in connection with the issuance and sale of the Notes or the Certificate. (11) SCHEDULE A hereto contains a complete list of all material agreements (other than the Transfer and Sale Agreement) or instruments evidencing or governing indebtedness for money borrowed to which Harley-Davidson Credit is a party or by which Harley-Davidson Credit or its property is bound. Neither Harley-Davidson Credit's transfer and assignment of the Contract Assets to CFC, CFC's concurrent transfer and assignment of the Trust Corpus to the Trust, nor the concurrent pledge by the Trust of the Collateral to the Indenture Trustee, nor the issuance and sale of the Notes or C-2 the Certificate or the entering into of the Program Agreements, nor the consummation of any other of the transactions contemplated therein, will violate or conflict with any agreement or instrument to which Harley-Davidson Credit is a party or by which it is otherwise bound. (12) In connection with the transfers of Contracts and related assets contemplated in the Transfer and Sale Agreement, (a) Harley-Davidson Credit has not made such transfer with actual intent to hinder, delay or defraud any creditor of Harley-Davidson Credit, and (b) Harley-Davidson Credit has not received less than a reasonably equivalent value in exchange for such transfer, is not on the date hereof insolvent (nor will Harley-Davidson Credit become insolvent as a result thereof), is not engaged (or about to engage) in a business or transaction for which it has unreasonably small capital, and does not intend to incur or believe it will incur debts beyond its ability to pay when matured. (13) The sole shareholder of Harley-Davidson Credit is Harley-Davidson Financial Services, Inc., a Delaware corporation, which has its chief executive office and only office in Chicago, Illinois, and has no other offices in any other state. (14) Each of the agreements and conditions of Harley-Davidson Credit to be performed or satisfied on or before the Closing Date under the Program Agreements has been performed or satisfied in all material respects. (15) Each Contract being transferred pursuant to the Transfer and Sale Agreement is evidenced by a written agreement providing for a repayment obligation as well as a security interest in the related Motorcycle securing such obligation, and conforms as to these matters in all material respects with the form of written Contract provided as EXHIBIT A hereto (with such minor variations as to specific terms as may be required or deemed desirable in respect of the laws or requirements of particular states). (16) Harley-Davidson Credit has not executed for filing any UCC financing statements listing the Contract Assets as collateral other than financing statements relating to the transactions contemplated in the Transfer and Sale Agreement and in the agreements listed on SCHEDULE A hereto. * * * * * * C-3 IN WITNESS WHEREOF, I have affixed my signature hereto this ___ day of [_____]. By: ------------------------------------------- Printed Name: Title: EXHIBIT D [Form of Opinion of Counsel for Trust Depositor Regarding General Corporate Matters (Including Perfection Opinion)] D-1 EXHIBIT E [Form of Opinion of Counsel for Trust Depositor Regarding the "TRUE SALE" Nature of the Transaction] E-1 EXHIBIT F [Form of Opinion of Counsel for Trust Depositor Regarding Non-consolidation] F-1 EXHIBIT G [Form of Certificate Regarding Reacquired Contracts] Harley-Davidson Credit Corp. Certificate Regarding Reacquired Contracts The undersigned certifies that he is the Treasurer of Harley-Davidson Credit Corp., a Nevada corporation (the "SERVICER"), and that as such is duly authorized to execute and deliver this certificate on behalf of the Servicer pursuant to Section 7.08 of the Sale and Servicing Agreement (the "AGREEMENT") dated as of [_____] by and among Harley-Davidson Customer Funding Corp., as Trust Depositor, the Servicer, [_____], as Indenture Trustee, and Harley-Davidson Motorcycle Trust [_____] (all capitalized terms used herein without definition having the respective meanings specified in the Agreement), and further certifies that: 1. The Contracts on the attached schedule are to be reacquired by the Seller on the date hereof pursuant to Section 7.08 of the Agreement and Section 5.01 of the Transfer and Sale Agreement. 2. Upon deposit of the Reacquisition Price for such Contracts, such Contracts may, pursuant to Section 7.08 of the Agreement, be assigned by the Trustee to the Seller. IN WITNESS WHEREOF, I have affixed hereunto my signature this ______ day of _____________. Harley-Davidson Credit Corp. By: ------------------------------------------- Printed Name: Title: G-1 EXHIBIT H [List of Contracts] H-1 EXHIBIT I [Form of Monthly Report to Noteholders and the Certificateholder] Harley-Davidson Motorcycle Trust [_____] $[_________] [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-1 $[_________] [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-2 $[_________] [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class B Monthly Report For the [ ] Distribution Date A. Calculation of Available Monies 1. Available Principal (as defined in Article I of the Sale and Servicing Agreement) $____________ 2. Available Interest (as defined in Article I of the Sale and Servicing Agreement) $____________ 3. Available Monies (l. plus 2.) $____________ B. Calculation of Principal Distributable Amount (as defined in Article I of the Sale and Servicing Agreement) $____________ C. Calculation of Available Interest (as defined in Article I of the Sale and Servicing Agreement). $____________ D. Calculation of Note Monthly Principal Distributable Amount $____________ 1A. Class A Note Percentage for such Distribution Date (a) for each Distribution Date to but excluding the Distribution Date on which the principal amount of the Class A-1 Notes is reduced to zero [_____]% (b) on the Distribution Date on which the principal amount of the Class A-1 Notes is reduced to zero, [_____]% until the principal amount of the Class A-2 Notes has been reduced to zero [_____]%

I-1 (c) on the Distribution Date on which the principal amount of the Class A-2 Notes is reduced to zero, ____% ______% (d) after the principal amount of the Class A-2 Notes have been reduced to zero 0.00% 1B. Class B Note Percentage for such Distribution Date (a) for each Distribution Date to but excluding the Distribution Date on which the principal amount of the Class A-2 Notes is reduced to zero [______]% (b) on the Distribution Date on which the principal amount of the Class A-2 Notes is reduced to zero, ___% ______% (c) after the principal amount of the Class A-2 Notes have been reduced to zero [_____]% 2. Principal Distributable Amount (from B) $____________

I-2 3. Note Monthly Principal Distributable Amount for (a) Class A-1 Notes (D.1(a) multiplied by D.2 until Principal Balance of Class A-1 Notes Principal Balance is zero) $____________ (b) Class A-2 Notes (D.1(b) multiplied by D.2 until Class A-2 Notes Principal Balance is zero) $____________ (c) Class B Notes (D.1(c) multiplied by D.2 until Class B Notes Principal Balance is zero) $____________ (d) Note Principal Carryover Shortfall $____________ (e) Mandatory Redemption Amounts (from Pre-Funding Account as defined in Article I of the Sale and Servicing Agreement) $____________ (f) Class A Note Monthly Principal Distributable Amount (the sum of items 3(a), 3(b), 3(d) and 3(e)) $____________ (g) Class B Note Monthly Principal Distributable Amount (the sum of items 3(c), 3(d) and 3(e)) $____________

I-3 E. Calculation of Note Monthly Interest Distributable Amount. 1. Class A-l Interest Rate _____% 2. Class A-2 Interest Rate _____% 3. Class B Interest Rate _____% 4. One-twelfth of the Class A-1 Interest Rate times the Class A-1 Note Balance from and including the fifteenth day of the month based on a 360-day year of 12 months of 30 days each (or from and including the Closing Date with respect to the first Distribution Date) to but excluding the fifteenth day of the month of the current Distribution Date $____________ 5. One-twelfth of the Class A-2 Note Interest Rate times the Class A-2 Note Balance from and including the fifteenth day of the month based on a 360-day year of 12 months of 30 days each (or from and including the Closing Date with respect to the first Distribution Date) to but excluding the fifteenth day of the month of the current Distribution Date $____________ 6. One-twelfth of the Class B Note Interest Rate times the Class B $_____________ Note Balance from and including the fifteenth day of the month based on a 360-day year of 12 months of 30 days each (or from and including the Closing Date with respect to the first Distribution Date) to but excluding the fifteenth day of the month of the current Distribution Date $____________ 7. Interest Carryover Shortfall for such Distribution Date $____________ 8. Note Monthly Interest Distributable Amount (the sum of items 3, 4 and 5) $____________ F. Calculation of Note Distributable Amount (sum of D.3(e) plus E.6.) $____________

I-4 G. Fees 1. The Monthly Servicing Fee for such Distribution Date (1/12 of the product of [_____]% and the Principal Balance of the Contracts as of the beginning of the related Due Period) $____________ 2. Indenture Trustee Fee for such Distribution Date excluding expense component (1/12 of the product of [_____]% and the sum of (i) the Principal Balance of the Contracts as of the beginning of the related Due Period and (ii) the Pre-Funded Amount as of the beginning of such Period; provided, however, in no event shall such fee be less than $200.00 per month) $____________ H. CALCULATION OF THE AVAILABLE MONIES FOR SUCH DISTRIBUTION DATE 1. The amount of funds deposited into the Collection Account pursuant to Section 5.05(b) of the Sale and Servicing Agreement with respect to the related Due Period $____________ a. All amounts received by the Indenture Trustee or the Servicer with respect to principal and interest on the Contracts, as well as Late Payment Penalty Fees and Extensions Fees for the related Due Period $____________ b. All Net Liquidation Proceeds $____________ c. The aggregate of the Reacquisition Prices for Contracts required to be reacquired by the Seller as described in Section 7.08 of the Sale and Servicing Agreement $____________ d. All Advances made by Servicer pursuant to Section 7.03(a) of the Sale and Servicing Agreement $____________

I-5 e. All amounts paid by the Seller in connection with an optional reacquisition of the Contracts described in Section 7.10 of the Sale and Servicing Agreement $____________ f. All amounts obtained from the Indenture Trustee in respect of Carrying Charges to be deposited into the Collection Account for the upcoming Distribution Date as contemplated in Section 7.03(b) of the Sale and Servicing Agreement $____________ g. All amounts received in respect of interest, dividends, gains, income and earnings on investments of funds in the Trust Accounts as contemplated in Section 5.05(b)(viii) of the Sale and Servicing Agreement $____________ h. Total amount of funds deposited into the Collection Account pursuant to Section 5.05(b) (the sum of a. through g.) $____________ 2. The amount of funds permitted to be withdrawn from the Collection Account pursuant to clauses (ii) through (iv) of Section 7.05(a) of the Sale and Servicing Agreement with respect to the related Due Period $____________ a. Amounts to be paid to the Servicer as the Reimbursement Amount in accordance with Section 7.03(a) of the Sale and Servicing Agreement $____________ b. Amounts to be paid to the Servicer in respect to the Servicing Fee for the related Due Period c. Amounts to be paid to the Indenture Trustee in respect of the Indenture Trustee's Fee for the related Due Period $____________

I-6 d. Other amounts required or authorized to be withdrawn from the Collection Account pursuant to the Sale and Servicing Agreement. Specify $____________ e. Total amount of funds permitted to be withdrawn from the Collection Account pursuant to clauses (ii) through (iv) Section 7.05(a) of the Sale and Servicing Agreement with respect to the related Due Period (sum of a. through d.) $____________ 3. The Available Monies (not including amounts from Reserve Fund Account) for such Distribution Date available to pay Note Distributable Amounts and Certificate Distributable Amounts (1(h) minus 2(e)) $____________ 4. The Available Monies otherwise distributable to the Certificateholders that will be distributed to the Noteholders on such Distribution Date $____________ I. The shortfall of Available Monies for such Distribution Date to pay either the Note Distributable Amount (the Available Monies for such Distribution Date minus the sum of the Note Distributable Amount as set forth in F.) $____________ J. The amount to be withdrawn from the Reserve Fund on such Distribution Date to cover the Note Interest Distributable Amount $____________ K. The amount to be withdrawn from the Reserve Fund on such Distribution Date to cover the Note Principal Distributable Amount $____________ L. Interest Earnings on the Reserve Fund. $____________ M. The amount on deposit in the Reserve Fund after giving effect to deposits and withdrawals therefrom on such Distribution Date $____________

I-7 N. The Specified Reserve Fund Amount for such Distribution Date will be an amount equal to the greater of (a) [_____]% of the Principal Balance of the Contracts in the Trust as of the last day of the immediately preceding Due Period; provided, however, in the event a Reserve Fund Trigger Event occurs with respect to a Distribution Date and has not terminated for three (3) consecutive Distribution Dates (inclusive) such amount shall be equal to [_____]% of the Principal Balance of the Contracts in the Trust as of the last day of the immediately preceding Due Period) and (b) [_____]% of the aggregate of the Initial Class A-1 Note Balance, Initial Class A-2 Note Balance and Initial Class B Note Balance; provided, however, in no event shall the Specified Reserve Fund Balance be greater than the aggregate outstanding principal balance of the Securities. $____________ O. The Pool Factor 1. The Class A-1 Note Pool Factor immediately before such Distribution Date ____________ 2. The Class A-2 Note Pool Factor immediately after such Distribution Date ____________ 3. The Class B Note Pool Factor immediately after such Distribution Date ____________ 4. The Class A-1 Note Pool Factor immediately before such Distribution Date ____________ 5. The Class A-2 Note Pool Factor immediately after such Distribution Date ____________ 6. The Class B Note Pool Factor immediately after such Distribution Date ____________ P. Delinquent Contracts 1. 31-59 Days #______ $____________ 2. 60-89 Days #______ $____________

I-8 3. 90 or More Days #______ $____________ Q. Liquidated Contracts 1. Total Liquidated Contracts #______ $____________ 2. Liquidation proceeds for the Due Period $____________ 3. Liquidation expenses for the Due Period $____________ 4. Net Liquidation Proceeds for the Due Period $____________ 5. Net Liquidation Losses for the Due Period $____________ R. Advances 1. Unreimbursed Advances prior to such Distribution Date $____________ 2. Amount paid to Servicer on such Distribution Date to reimburse Servicer for such unreimbursed Advances $____________ 3. Amount of Delinquent Interest for such Distribution Date $____________ 4. Amount of new Advances on such Distribution Date (if such amount is less than the amount of Delinquent Interest, attach the certificate required by Section 7.03 of the Sale and Servicing Agreement) $____________ 5. Total of unreimbursed Advances after new Advances on such Distribution Date $____________ S. Reacquired Contracts 1. Number of Contracts to be reacquired by the Seller pursuant to Section 7.08 of the Sale and Servicing Agreement $____________ 2. Principal Amount of such Contracts $____________ 3. Related Reacquisition Price of such Contracts $____________

I-9 T. Contracts 1. Number of Contracts as of beginning of Due Period $____________ 2. Principal Balance of Contracts as of beginning of Due Period $____________ 3. The weighted average Contract Rate of the Contracts as of the beginning of the Due Period $____________ 4. Number of Contracts as of end of Due Period $____________ 5. Principal Balance of Contracts as of end of Due Period $____________ 6. The weighted average Contract Rate of the Contracts as of the end of the Due Period $____________ 7. The weighted average remaining term to maturity of the Contracts as of the end of the Due Period $____________ 8. Pre-Funded Amount as of beginning of Due Period $____________ 9. Pre-Funded Amount as of end of Due Period $____________ U. Interest Reserve Account 1. Interest Reserve Amount as of previous Distribution Date $____________ 2. Interest received into Interest Reserve Account $____________ 3. Carrying Charges (if any) to be paid on upcoming Distribution Date $____________ 4. Excess Funds remitted to Trust Depositor $____________ 5. Interest Reserve Amount as of upcoming Distribution Date $____________ V. Ratios

I-10 1. Cumulative Loss Ratio a. The aggregate Net Liquidation Losses for all Contracts since the Initial Cutoff Date through the end of the related Due Period $_____________ b. The sum of the Principal Balance of the Contracts as of the Initial Cutoff Date plus the Principal Balance of any Subsequent Contracts as of the related Subsequent Cutoff Date $____________ c. The Cumulative Loss Ratio for such Distribution Date (the quotient of a. divided by b., expressed as a percentage) $____________ 2. Average Delinquency Ratio for such Distribution Date (a) The Delinquency Amount (the Principal Balance of all Contracts that were delinquent 60 days or more as of the end of the Due Period) $____________ (b) The Delinquency Ratio (the fraction (expressed as a percentage) computed by dividing (a) the Delinquency Amount during the immediately preceding Due Period by (b) the Principal Balance of the Contracts as of the beginning of the related Due Period) for such Distribution Date _____% (c) The Delinquency Ratio for the prior Distribution Date _____% (d) The Delinquency Ratio for the second prior Distribution Date _____% (e) The Average Delinquency Ratio (the arithmetic average of a. through c.) _____% 3. Average Loss Ratio for such Distribution Date

I-11 (a) Net Liquidation Losses $________ (b) The Loss Ratio for (the fraction (expressed as a percentage) derived by dividing (x) Net Liquidation Losses for all Contracts that became Liquidated Contracts during the immediately preceding Due Period multiplied by twelve by (y) the outstanding Principal Balances of all Contracts as of the beginning of the Due Period) such Distribution Date _____% (c) The Loss Ratio for the prior Distribution Date _____% (d) The Loss Ratio for the second prior Distribution Date _____% (e) The Average Loss Ratio (the arithmetic average of a. through c.) _____% 4. Computation of Specified Reserve Fund Balance Reserve Fund Trigger Events

I-12 (1) Average Delinquency Ratio (if (a) (i) Average Delinquency Ratio [_____]% with respect to any Distribution Date which occurs within the period from the Closing Date to, and inclusive of, the first anniversary of the Closing Date, (ii) [_____]% with respect to any Distribution Date which occurs within the period from the day after the first anniversary of the Closing Date to, and inclusive of, the second anniversary of the Closing Date or (iii) [_____]% for any Distribution Date which occurs within the period from the day after the second anniversary of the Closing Date to, and inclusive of, the third anniversary of the Closing Date or (iv) [_____]% for any Distribution Date following the third anniversary of the Closing Date, then a Reserve Fund Trigger Event has occurred) _____% (2) Average Loss Ratio (if Average Loss Ratio is equal to or greater than (i) [_____]% with respect to any Distribution Date which occurs within the period from the Closing Date to, and inclusive of, the second anniversary of the Closing Date or (ii) [_____]% with respect to any Distribution Date which occurs following the second anniversary of the Closing Date, then a Reserve Fund Trigger Event has occurred) _____%

I-13 (3) Cumulative Loss Ratio (if Cumulative Loss Ratio is equal to or greater than (i) [_____]% with respect to any Distribution Date which occurs within the period from the Closing Date to, and inclusive of, the first anniversary of the Closing Date, (ii) [_____]% with respect to any Distribution Date which occurs within the period from the day after the first anniversary of the Closing Date to, and inclusive of, the second anniversary of the Closing Date, (iii) [_____]% for any Distribution Date while occurs within the period from the day after the second anniversary of the Closing Date to, and inclusive of the third anniversary of the Closing Date, or (iv) [_____]% following the third anniversary of the Closing Date, then a Reserve Fund Trigger Event has occurred) _____%

I-14 EXHIBIT J [Seller's Representations and Warranties] (1) REPRESENTATIONS AND WARRANTIES REGARDING SELLER. Seller represents and warrants, as of the execution and delivery of this Agreement and as of the Closing Date, in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date, in the case of Subsequent Contracts, that: (a) ORGANIZATION AND GOOD STANDING. Seller is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and has the corporate power to own its assets and to transact the business in which it is currently engaged. Seller is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the character of the business transacted by it or properties owned or leased by it requires such qualification and in which the failure so to qualify would have a material adverse effect on the business, properties, assets, or condition (financial or otherwise) of Seller or Trust Depositor. Seller is properly licensed in each jurisdiction to the extent required by the laws of such jurisdiction to service the Contracts in accordance with the terms of the Sale and Servicing Agreement. (b) AUTHORIZATION; BINDING OBLIGATION. Seller has the power and authority to make, execute, deliver and perform this Agreement and the other Transaction Documents to which the Seller is a party and all of the transactions contemplated under this Agreement and the other Transaction Documents to which the Seller is a party, and has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the other Transaction Documents to which the Seller is a party. This Agreement and the other Transaction Documents to which the Seller is a party constitute the legal, valid and binding obligation of Seller enforceable in accordance with their terms, except as enforcement of such terms may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights generally and by the availability of equitable remedies. (c) NO CONSENT REQUIRED. Seller is not required to obtain the consent of any other party or any consent, license, approval or authorization from, or registration or declaration with, any governmental authority, bureau or agency in connection with the execution, delivery, performance, validity or enforceability of this Agreement and the other Transaction Documents to which the Seller is a party. (d) NO VIOLATIONS. Seller's execution, delivery and performance of this Agreement and the other Transaction Documents to which the Seller is a party will not violate any provision of any existing law or regulation or any order or decree of any court or the Articles of Incorporation or Bylaws of Seller, or constitute a material breach of any mortgage, indenture, contract or other agreement to which Seller is a party or by which Seller or any of Seller's properties may be bound. J-1 (e) LITIGATION. No litigation or administrative proceeding of or before any court, tribunal or governmental body is currently pending, or to the knowledge of Seller threatened, against Seller or any of its properties or with respect to this Agreement or any other Transaction Document to which the Seller is a party which, if adversely determined, would in the opinion of Seller have a material adverse effect on the business, properties, assets or condition (financial or other) of Seller or the transactions contemplated by this Agreement or any other Transaction Document to which the Seller is a party. (f) STATE OF INCORPORATION; NAME; NO CHANGES. Seller's state of incorporation is the State of Nevada. Seller's exact legal name is as set forth in the first paragraph of this Agreement. Seller has not changed its name whether by amendment of its Articles of Incorporation, by reorganization or otherwise, and has not changed its state of incorporation within the four months preceding the Closing Date. (g) BUELL. Approximately [_____]% of the aggregate principal balance of contracts financed from time to time by the Seller are secured by motorcycles manufactured by Buell. (h) SOLVENCY. The Seller, after giving effect to the conveyances made by it hereunder, is Solvent. (2) REPRESENTATIONS AND WARRANTIES REGARDING EACH CONTRACT. Seller represents and warrants as to each Contract as of the execution and delivery of this Agreement and as of the Closing Date, in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date, in the case of Subsequent Contracts, that: (a) LIST OF CONTRACTS. The information set forth in the List of Contracts (or Subsequent List of Contracts, in the case of Subsequent Contracts) is true, complete and correct in all material respects as of the Initial Cutoff Date or applicable Subsequent Cutoff Date, as the case may be. (b) PAYMENTS. As of the Initial Cutoff Date or applicable Subsequent Cutoff Date, as the case may be, the most recent scheduled payment with respect to any Contract either had been made or was not delinquent for more than 30 days. To the best of Seller's knowledge, all payments made on each Contract were made by the respective Obligor or under a debt insurance policy or debt cancellation agreement. (c) NO WAIVERS. As of the Closing Date (or the applicable Subsequent Transfer Date, in the case of Subsequent Contracts), the terms of the Contracts have not been waived, altered or modified in any respect, except by instruments or documents included in the related Contract File. (d) BINDING OBLIGATION. Each Contract is a legal, valid and binding payment obligation of the Obligor thereunder and is enforceable in accordance with its terms, J-2 except as such enforceability may be limited by insolvency, bankruptcy, moratorium, reorganization, or other similar laws affecting the enforcement of creditors' rights generally. (e) NO DEFENSES. No Contract is subject to any right of rescission, setoff, counterclaim or defense, including the defense of usury, and the operation of any of the terms of such Contract or the exercise of any right thereunder will not render the Contract unenforceable in whole or in part or subject to any right of rescission, setoff, counterclaim or defense, including the defense of usury, and no such right of rescission, setoff, counterclaim or defense has been asserted with respect thereto. (f) INSURANCE. The Seller, in accordance with its policies and procedures, has determined that, as of the date of origination of each Contract, the related Obligor had obtained or agreed to obtain physical damage insurance covering the Motorcycle. The terms of each Contract require that for the term of such Contract the Motorcycle securing such Contract will be covered by physical damage insurance. (g) ORIGINATION. Each Contract (i) was originated by a Harley-Davidson motorcycle dealer or by Eaglemark Savings Bank, in each case, in the regular course of its business, (ii) was fully and properly executed by the parties thereto, and (iii) has been purchased by Seller in the regular course of its business. Each Contract was sold by such motorcycle dealer or Eaglemark Savings Bank, as the case may be, to the Seller without any fraud or misrepresentation on the part of such motorcycle dealer or Eaglemark Savings Bank. (h) LAWFUL ASSIGNMENT. No Contract was originated in or is subject to the laws of any jurisdiction whose laws would make the sale, transfer and assignment of the Contract under this Agreement or under the Sale and Servicing Agreement or the pledge of the Contract under the Indenture unlawful, void or voidable. (i) COMPLIANCE WITH LAW. None of the Contracts, the origination of the Contracts by Harley-Davidson motorcycle dealers or Eaglemark Savings Bank, the purchase of the Contracts by the Seller, the sale of the Contracts by the Seller to the Trust Depositor or by the Trust Depositor to the Trust, or any combination of the foregoing, violated at the time of origination or as of the Closing Date or as of any Subsequent Transfer Date, as applicable, any requirement of any federal, state or local law and regulations thereunder, including, without limitation, usury, truth in lending, motor vehicle installment loan and equal credit opportunity laws, applicable to the Contracts and the sale of Motorcycles. J-3 (j) CONTRACT IN FORCE. As of the Closing Date (or the applicable Subsequent Transfer Date in the case of Subsequent Contracts), no Contract has been satisfied or subordinated in whole or in part or rescinded, and the related Motorcycle securing any Contract has not been released from the lien of the Contract in whole or in part. (k) VALID SECURITY INTEREST. Each Contract creates a valid, subsisting and enforceable first priority perfected security interest in favor of Seller or Eaglemark Savings Bank (as the case may be) in the Motorcycle covered thereby, and such security interest has been assigned by Eaglemark Savings Bank to Seller (where applicable) and by Seller to the Trust Depositor. Eaglemark Savings Bank's security interest has been validly assigned by Eaglemark Savings Bank to Seller. Seller's security interest has been validly assigned by the Seller to the Trust Depositor pursuant to this Agreement and by the Trust Depositor to the Issuer pursuant to the Sale and Servicing Agreement. Immediately prior to the transfer, assignment and conveyance thereof, each Contract is secured by a first priority, validly perfected security interest in the Motorcycle covered thereby in favor of the Seller or Eaglemark Savings Bank as secured party or all necessary and appropriate actions have been commenced that would result in a first priority, validly perfected security interest in the Motorcycle covered thereby in favor of the Seller or Eaglemark Savings Bank as secured party, except, in each case, as to priority for any lien for taxes, labor, materials or of any state law enforcement agency affecting a Motorcycle. (l) GOOD TITLE. Each Contract was purchased by Seller for value and taken into possession prior to the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts) in the ordinary course of its business, without knowledge that the Contract was subject to a security interest. No Contract has been sold, assigned or pledged to any person other than Trust Depositor and the Issuer as the transferee of Trust Depositor, and prior to the transfer of the Contract to Trust Depositor, Seller had good and marketable title to each Contract free and clear of any encumbrance, equity, loan, pledge, charge, claim or security interest and was the sole owner thereof and had full right to transfer the Contract to Trust Depositor, and, immediately upon the transfer of each Contract by the Seller, the Trust Depositor shall have good and marketable title to each Contract free and clear of any encumbrance, equity, loan, pledge, charge, claim or security interest, and, immediately upon the transfer of each Contract by the Trust Depositor, the Issuer shall have good and marketable title to each Contract free and clear of any encumbrance, equity, loan, pledge, charge, claim or security interest. (m) NO DEFAULTS. As of the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts), no default, breach, violation or event permitting acceleration existed with respect to any Contract and no event had occurred which, with notice and the expiration of any grace or cure period, would constitute such a default, breach, violation or event permitting acceleration under such Contract. Seller has not waived any such default, breach, violation or event permitting acceleration, and Seller has not granted any extension of payment terms on any Contract. As of the Initial Cutoff J-4 Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts), no Motorcycle had been repossessed. (n) NO LIENS. As of the Closing Date (or the applicable Subsequent Transfer Date in the case of Subsequent Contracts) there are, to the best of Seller's knowledge, no liens or claims which have been filed for work, labor or materials affecting the Motorcycle securing any Contract which are liens prior to, or equal with, the lien of such Contract. (o) INSTALLMENTS. Each Contract has a fixed Contract Rate and provides for monthly payments of principal and interest which, if timely made, would fully amortize the loan on a simple-interest basis over its term. (p) ENFORCEABILITY. Each Contract contains customary and enforceable provisions such as to render the rights and remedies of the holder thereof adequate for the realization against the collateral of the benefits of the security. (q) ONE ORIGINAL. Each Contract is evidenced by only one original executed Contract, which original has been delivered to the Issuer or its designee on or before the Closing Date (or the applicable Subsequent Transfer Date in the case of Subsequent Contracts). (r) NO GOVERNMENT OBLIGORS. No Obligor is the United States government or an agency, authority, instrumentality or other political subdivision of the United States government. (s) LOCKBOX BANK. The Lockbox Bank is the only institution holding any Lockbox Account for receipt of payments from Obligors, and all Obligors have been instructed to make payments to the Lockbox Account (either directly by remitting payments to the Lockbox, or indirectly by making payments through direct debit, the telephone or the internet to an account of the Servicer which payments will be subsequently transferred from such account to one or more Lockbox Banks), and no person claiming through or under Seller has any claim or interest in the Lockbox Account other than the Lockbox Bank; provided, however, that other "Trusts" (as defined in the Lockbox Agreement) shall have an interest in certain other collections therein not related to the Contracts. (t) OBLIGOR BANKRUPTCY. At the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts), no Obligor was subject to a bankruptcy proceeding (according to the records of the Seller) within the one year preceding such Cutoff Date. (u) CHATTEL PAPER. The Contracts constitute tangible chattel paper within the meaning of the UCC. J-5 (v) CONTRACT NOT ASSUMABLE. No Contract is assumable by another Person in a manner which would release the Obligor thereof from such Obligor's obligations to the Trust Depositor with respect to such Contract. (3) REPRESENTATIONS AND WARRANTIES REGARDING THE CONTRACTS IN THE AGGREGATE. Seller represents and warrants, as of the execution and delivery of this Agreement and as of the Closing Date, in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date, in the case of Subsequent Contracts, that: (a) AMOUNTS. The sum of the aggregate Principal Balances payable by Obligors under the Contracts as of the Initial Cutoff Date (or the applicable Subsequent Cutoff Date in the case of Subsequent Contracts), plus the Pre-Funded Amount as of such date, equals or exceeds the sum of the principal balance of the Class A-1 Notes, the Class A-2 Notes and the Class B Notes on the Closing Date or the related Subsequent Transfer Date, as applicable. (b) CHARACTERISTICS. The Initial Contracts have the following characteristics: (i) all the Contracts are secured by Motorcycles; (ii) no Initial Contract has a remaining maturity of more than [_____] months; and (iii) the final scheduled payment on the Initial Contract with the latest maturity is due not later than [_____]. Approximately [____]% of the Principal Balance of the Initial Contracts as of the Initial Cutoff Date is attributable to loans for purchases of new Motorcycles and approximately [____]% is attributable to loans for purchases of used Motorcycles. No Initial Contract was originated after the Initial Cutoff Date. No Initial Contract has a Contract Rate less than [____]%. The last scheduled payment date of the Contracts (including any Subsequent Contracts) is due no later than [_____]. Approximately [____]% of the Principal Balance of the Initial Contracts as of the Initial Cutoff Date is attributable to loans for purchases of Motorcycles manufactured by Harley-Davidson or Buell and approximately [____]% of the Principal Balance of the Initial Contracts as of the Initial Cutoff Date is attributable to loans to purchase Motorcycles not manufactured by Harley-Davidson or Buell. (c) MARKING RECORDS. As of the Closing Date (or the applicable Subsequent Transfer Date in the case of Subsequent Contracts), Seller has caused the Computer File relating to the Contracts sold hereunder and concurrently reconveyed by Trust Depositor to the Trust and pledged by the Trust to the Indenture Trustee to be clearly and unambiguously marked to indicate that such Contracts constitute part of the Trust Corpus, are owned by the Trust and constitute security for the Notes. (d) NO ADVERSE SELECTION. No selection procedures adverse to Noteholders have been employed in selecting the Contracts. (e) TRUE SALE. The transactions contemplated by the Transfer and Sale Agreement and this Agreement constitute valid sales, transfers and assignments from Seller to Trust Depositor and from Trust Depositor to the Trust of all of Seller's right, J-6 title and interest in the Contract Assets as of the Closing Date and any Subsequent Transfer Date, as applicable. (f) ALL FILINGS MADE. All filings (including, without limitation, UCC filings) required to be made by any Person and actions required to be taken or performed by any Person in any jurisdiction to give the Trustee a first priority perfected lien on, or ownership interest in, the Contracts and the proceeds thereof and the rest of the Trust Corpus have been made, taken or performed. (g) DELTA LOANS. No more than [_____]% of the Principal Balance of the Contracts as of the end of the Funding Period is attributable to Delta Loans. (4) REPRESENTATIONS AND WARRANTIES REGARDING THE CONTRACT FILES. Seller represents and warrants as of the execution and delivery of this Agreement and as of the Closing Date, in the case of the Initial Contracts, and as of the applicable Subsequent Transfer Date, in the case of Subsequent Contracts, that: (a) POSSESSION. Immediately prior to the Closing Date or any Subsequent Transfer Date, the Servicer, or its custodian, will have possession of each original Contract and the related complete Contract File. Each of such documents which is required to be signed by the Obligor has been signed by the Obligor in the appropriate spaces. All blanks on any form have been properly filled in and each form has otherwise been correctly prepared. The complete Contract File for each Contract currently is in the possession of the Servicer, or its custodian. (b) BULK TRANSFER LAWS. The transfer, assignment and conveyance of the Contracts and the Contract Files by Seller pursuant to the Transfer and Sale Agreement or any Subsequent Purchase Agreement and by Trust Depositor pursuant to the Sale and Servicing Agreement is not subject to the bulk transfer or any similar statutory provisions in effect in any applicable jurisdiction. J-7 EXHIBIT K [Lockbox Bank and Lockbox Account] LOCKBOX Harley-Davidson Credit Corp. 135 South LaSalle Street, Dept. 8529 Chicago, Illinois 60674-8529 LOCKBOX BANK LaSalle Bank National Association 135 South LaSalle Street Chicago, Illinois 60674 K-1 EXHIBIT L [Form of Subsequent Transfer Agreement] [see EXHIBIT C of the Transfer and Sale Agreement] L-1 EX-10.3 8 a2158269zex-10_3.txt EXHIBIT 10.3 EXHIBIT 10.3 - -------------------------------------------------------------------------------- ADMINISTRATION AGREEMENT AMONG HARLEY-DAVIDSON MOTORCYCLE TRUST [_____], AS ISSUER, HARLEY-DAVIDSON CREDIT CORP., AS ADMINISTRATOR, HARLEY-DAVIDSON CUSTOMER FUNDING CORP., AS TRUST DEPOSITOR, AND [_____], AS INDENTURE TRUSTEE DATED AS OF [_____] - -------------------------------------------------------------------------------- TABLE OF CONTENTS SECTION 1. DUTIES OF THE ADMINISTRATOR..................................................3 SECTION 2. RECORDS......................................................................8 SECTION 3. COMPENSATION.................................................................8 SECTION 4. ADDITIONAL INFORMATION TO BE FURNISHED TO THE ISSUER.........................9 SECTION 5. INDEPENDENCE OF THE ADMINISTRATOR............................................9 SECTION 6. NO JOINT VENTURE.............................................................9 SECTION 7. OTHER ACTIVITIES OF ADMINISTRATOR............................................9 SECTION 8. TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR..................9 SECTION 9. ACTION UPON TERMINATION, RESIGNATION OR REMOVAL.............................10 SECTION 10. NOTICES....................................................................11 SECTION 11. AMENDMENTS.................................................................11 SECTION 12. SUCCESSORS AND ASSIGNS.....................................................11 SECTION 13. GOVERNING LAW..............................................................12 SECTION 14. HEADINGS...................................................................12 SECTION 15. COUNTERPARTS...............................................................12 SECTION 16. SEVERABILITY...............................................................12 SECTION 17. NOT APPLICABLE TO HARLEY-DAVIDSON CREDIT IN OTHER CAPACITIES...............12 SECTION 18. LIMITATION OF LIABILITY OF OWNER TRUSTEE AND INDENTURE TRUSTEE.............12 SECTION 19. THIRD-PARTY BENEFICIARY....................................................13 SECTION 20. SURVIVABILITY..............................................................13

This Administration Agreement, dated as of [_____], among Harley-Davidson Motorcycle Trust [_____] (the "ISSUER"), Harley-Davidson Credit Corp. (together with its successors and assigns "HARLEY-DAVIDSON CREDIT") in its capacity as administrator, the "ADMINISTRATOR"), Harley-Davidson Customer Funding Corp. (the "TRUST DEPOSITOR") and [_____], not in its individual capacity but solely as Indenture Trustee (together with its successors and assigns, the "INDENTURE TRUSTEE"). W I T N E S S E T H: WHEREAS, the Issuer is issuing [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-1 Notes, [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class A-2 Notes and [____]% Harley-Davidson Motorcycle Contract Backed Notes, Class B Notes (collectively, the "NOTES") pursuant to the Indenture, dated as of the date hereof (the "INDENTURE"), between the Issuer and the Indenture Trustee (capitalized terms used herein that are not otherwise defined shall have the meanings ascribed thereto in the Indenture); WHEREAS, the Issuer has entered into certain agreements in connection with the issuance of the Notes including (i) a Sale and Servicing Agreement, dated as of the date hereof (the "SALE AND SERVICING AGREEMENT"), among the Issuer, the Indenture Trustee, the Trust Depositor and Harley-Davidson Credit, as servicer (in such capacity, the "SERVICER"), and (ii) the Indenture (collectively referred to hereinafter as the "TRANSACTION DOCUMENTS"); WHEREAS, pursuant to the Transaction Documents, the Issuer and the Owner Trustee are required to perform certain duties in connection with (i) the Notes and the collateral therefor pledged pursuant to the Indenture (the "COLLATERAL") and (ii) the beneficial ownership interest in the Issuer (the registered holder of such interest being referred to herein as the "OWNER"); WHEREAS, the Issuer and the Owner Trustee desire to have the Administrator perform certain of the duties of the Issuer and the Owner Trustee referred to in the preceding clause and to provide such additional services consistent with the terms of this Agreement and the Transaction Documents as the Issuer and the Owner Trustee may from time to time request; and WHEREAS, the Administrator has the capacity to provide the services required hereby and is willing to perform such services for the Issuer and the Owner Trustee on the terms set forth herein; NOW, THEREAFTER, in consideration of the mutual covenants contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows: - 2 - SECTION 1. DUTIES OF THE ADMINISTRATOR. (a) Duties with respect to the Indenture. (i) The Administrator agrees to perform all its duties as Administrator and the duties of the Issuer and the Owner Trustee under the Transaction Documents. In addition, the Administrator shall consult with the Owner Trustee regarding the duties of the Issuer or the Owner Trustee under the Indenture. The Administrator shall monitor the performance of the Issuer and shall advise the Owner Trustee when action is necessary to comply with the respective duties of the Issuer and the Owner Trustee under the Indenture. The Administrator shall prepare for execution by the Issuer or shall cause the preparation by other appropriate persons of, all such documents, reports, filings, instruments, certificates and opinions that it shall be the duty of the Issuer or the Owner Trustee to prepare, file or deliver pursuant to the Indenture. In furtherance of the foregoing, the Administrator shall take all appropriate action that the Issuer or the Owner Trustee is required to take pursuant to the Indenture including, without limitation, such of the foregoing as are required with respect to the following matters under the Indenture (references are to Sections of the Indenture): (A) the duty to cause the Note Register to be kept and to give the Indenture Trustee notice of any appointment of a new Note Registrar and the location, or change in location, of the Note Register (Section 2.04); (B) the notification of Noteholders of the final principal payment on their Notes (Section 2.07(b)); (C) the fixing or causing to be fixed of any special record date and the notification of the Indenture Trustee and Noteholders with respect to special payment dates, if any (Section 2.07(c)); (D) the preparation of or obtaining of the documents and instruments required for execution and authentication of the Notes and delivery of the same to the Indenture Trustee (Section 2.02); (E) the preparation, obtaining or filing of the instruments, opinions and certificates and other documents required for the release of Collateral (Section 2.12); (F) the maintenance of an office in the City of [_____], for registration of transfer or exchange of Notes (Section 3.02); (G) the duty to cause newly appointed Paying Agents, if any, to deliver to the Indenture Trustee the instrument specified in the Indenture regarding funds held in trust (Section 3.03); - 3 - (H) the direction to the Indenture Trustee to deposit monies with Paying Agents, if any, other than the Indenture Trustee (Section 3.03); (I) the obtaining and preservation of the Issuer's qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of the Indenture, the Notes, the Collateral and each other instrument and agreement included in the Collateral (Section 3.04); (J) the preparation of all supplements and amendments to the Indenture and all financing statements, continuation statements, instruments of further assurance and other instruments and the taking of such other action as is necessary or advisable to protect the Collateral other than as prepared by the Servicer (Section 3.05); (K) the delivery of the Opinion of Counsel on the Closing Date and certain other statements as to compliance with the Indenture (Sections 3.06 and 3.09); (L) the identification to the Indenture Trustee in an Officer's Certificate of a Person with whom the Issuer has contracted to perform its duties under the Indenture (Section 3.07(b)); (M) the notification of the Indenture Trustee and each Rating Agency of an Event of Termination under the Sale and Servicing Agreement; (N) the duty to cause the Servicer to comply with Article Five and Article Nine of the Sale and Servicing Agreement (Section 3.14); (O) the preparation and obtaining of documents and instruments required for the release of the Issuer from its obligations under the Indenture (Section 3.10(b) and Section 3.11(b)); (P) the delivery of written notice to the Indenture Trustee and each Rating Agency of each Event of Default under the Indenture and each Event of Termination by the Servicer under the Sale and Servicing Agreement (Section 3.18); (Q) the monitoring of the Issuer's obligations as to the satisfaction and discharge of the Indenture and the preparation of an Officer's Certificate and the obtaining of the Opinion of Counsel and the Independent Certificate relating thereto (Section 4.01); (R) the compliance with any written directive of the Indenture Trustee with respect to the sale of the Collateral in a commercially reasonable manner if an Event of Default shall have occurred and be continuing (Section 5.04); - 4 - (S) the preparation and delivery of notice to Noteholders of the removal of the Indenture Trustee and the appointment of a successor Indenture Trustee (Section 6.08); (T) the preparation of any written instruments required to confirm more fully the authority of any co-trustee or separate trustee and any written instruments necessary in connection with the resignation or removal of the Indenture Trustee or any co-trustee or separate trustee (Sections 6.08 and 6.10); (U) the furnishing of the Indenture Trustee with the names and addresses of Noteholders during any period when the Indenture Trustee is not the Note Registrar (Section 7.01); (V) the opening of one or more accounts in the Indenture Trustee's name, the preparation and delivery of Issuer Orders, Officer's Certificates and Opinions of Counsel and all other actions necessary with respect to investment and reinvestment of funds in the Trust Accounts (Sections 8.02 and 8.03); (W) the preparation of an Issuer Request and Officer's Certificate and the obtaining of an Opinion of Counsel and Independent Certificates, if necessary, for the release of the Collateral (Sections 8.04 and 8.05); (X) the preparation of Issuer Orders and the obtaining of Opinions of Counsel with respect to the execution of supplemental indentures and the mailing to the Noteholders of notices with respect to such supplemental indentures (Sections 9.01, 9.02 and 9.03); (Y) the execution and delivery of new Notes conforming to any supplemental indenture (Section 9.06); (Z) the duty to notify Noteholders of redemption of the Notes or to cause the Indenture Trustee to provide such notification (Section 10.02); (AA) the preparation and delivery of all Officer's Certificates, Opinions of Counsel and Independent Certificates with respect to any requests by the Issuer to the Indenture Trustee to take any action under the Indenture (Section 11.01(a)); (BB) the preparation and delivery of Officer's Certificates and the obtaining of Independent Certificates, if necessary, for the release of property from the lien of the Indenture (Section 11.01(b)); (CC) the notification of the Rating Agencies, upon the failure of the Issuer, the Owner Trustee or the Indenture Trustee to provide notification; - 5 - (DD) the preparation and delivery to Noteholders and the Indenture Trustee of any agreements with respect to alternate payment and notice provisions (Section 11.06); (EE) the recording of the Indenture, if applicable (Section 11.14); and (FF) the appointment of a successor Indenture Trustee. (ii) The Administrator will: (A) except as otherwise expressly provided in the Indenture, pay the Indenture Trustee's fees and reimburse the Indenture Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Indenture Trustee in accordance with any provision of the Indenture (including the reasonable compensation, expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith; (B) indemnify the Indenture Trustee and its agents for, and hold them harmless against, any loss, liability or expense incurred without negligence or bad faith on their part, arising out of or in connection with the acceptance or administration of the transactions contemplated by the Indenture, including the reasonable costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their powers or duties under the Indenture; and (C) indemnify the Owner Trustee and its agents for, and hold them harmless against, any loss, liability or expense incurred without negligence or bad faith on their part, arising out of or in connection with the acceptance or administration of the transactions contemplated by the Trust Agreement, including the reasonable costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their powers or duties under the Trust Agreement. (b) ADDITIONAL DUTIES. (i) In addition to the duties set forth in Section 1(a)(i), the Administrator shall perform such calculations and shall prepare or shall cause the preparation by other appropriate persons of, and shall execute on behalf of the Issuer or the Owner Trustee, all such documents, reports, filings, instruments, certificates and opinions that the Issuer or the Owner Trustee are required to prepare, file or deliver pursuant to the Transaction Documents or under Section 5.03 of the Trust Agreement, and at the request of the Owner Trustee shall take all appropriate action that the Issuer or the Owner Trustee are required to take pursuant to the Transaction Documents. In furtherance thereof, the Owner Trustee shall, on behalf of the Issuer, execute and deliver to the Administrator - 6 - and to each successor Administrator appointed pursuant to the terms hereof, one or more powers of attorney substantially in the form of EXHIBIT A hereto, appointing the Administrator the attorney-in-fact of the Issuer for the purpose of executing on behalf of the Owner Trustee and the Issuer all such documents, reports, filings, instruments, certificates and opinions. Subject to Section 5, and in accordance with the directions of the Issuer, the Administrator shall administer, perform or supervise the performance of such other activities in connection with the Collateral (including the Transaction Documents) as are not covered by any of the foregoing provisions and as are expressly requested by the Issuer and are reasonably within the capability of the Administrator. (ii) Notwithstanding anything in this Agreement or the Transaction Documents to the contrary, the Administrator shall be responsible for promptly notifying the Owner Trustee in the event that any withholding tax is imposed on the Trust's payments (or allocations of income) to the Owner as contemplated in Section 5.01(c) of the Trust Agreement. Any such notice shall specify the amount of any withholding tax required to be withheld by the Owner Trustee pursuant to such provision. (iii) Notwithstanding anything in this Agreement or the Transaction Documents to the contrary, the Administrator shall be responsible for performance of the duties of the Owner Trustee set forth in Section 5.03(a), (b), (c) and (d), the penultimate sentence of Section 5.03 and Section 5.04(a) of the Trust Agreement with respect to, among other things, accounting and reports to the Owner; PROVIDED, HOWEVER, that the Owner Trustee shall retain responsibility for the distribution of information forms necessary to enable the Owner to prepare its federal and state income tax returns. (iv) The Administrator shall satisfy its obligations with respect to clauses (ii) and (iii) above by retaining, at the expense of the Trust payable by the Administrator, a firm of independent public accountants (the "ACCOUNTANTS") acceptable to the Owner Trustee, which shall perform the obligations of the Administrator thereunder. (v) The Administrator shall perform the duties of the Administrator specified in Section 10.02 of the Trust Agreement required to be performed in connection with the resignation or removal of the Owner Trustee, and any other duties expressly required to be performed by the Administrator under the Trust Agreement. (vi) In carrying out the foregoing duties or any of its other obligations under this Agreement, the Administrator may enter into transactions or otherwise deal with any of its Affiliates; PROVIDED, HOWEVER, that the terms of any such transactions or dealings shall be in accordance with any directions received from the Issuer and shall be, in the Administrator's opinion, no less favorable to the Issuer than would be available from unaffiliated parties. - 7 - (c) NON-MINISTERIAL MATTERS. (i) With respect to matters that in the reasonable judgment of the Administrator are non-ministerial, the Administrator shall not take any action unless within a reasonable time before the taking of such action, the Administrator shall have notified the Owner Trustee of the proposed action and the Owner Trustee shall not have withheld consent or provided an alternative direction. For the purpose of the preceding sentence, "NON-MINISTERIAL MATTERS" shall include, without limitation: (A) the amendment of or any supplement to the Indenture; (B) the initiation of any claim or lawsuit by the Issuer and the compromise of any action, claim or lawsuit brought by or against the Issuer (other than in connection with the collection of the Contracts); (C) the amendment, change or modification of any other Transaction Documents; (D) the appointment of successor Note Registrars, successor Paying Agents and successor Indenture Trustees pursuant to the Indenture or the appointment of successor Administrators or a successor Servicer, or the consent to the assignment by the Note Registrar, Paying Agent or Indenture Trustee of its obligations under the Indenture; and (E) the removal of the Indenture Trustee. (ii) Notwithstanding anything to the contrary in this Agreement, the Administrator shall not be obligated to, and shall not, (A) make any payments to the Noteholders under the Transaction Documents, (B) sell the Collateral pursuant to clause (iv) of Section 5.04 of the Indenture, (C) take any other action that the Issuer directs the Administrator not to take on its behalf or (D) take any other action which may be construed as having the effect of varying the investment of the Holders. SECTION 2. RECORDS. The Administrator shall maintain appropriate books of account and records relating to services performed hereunder, which books of account and records shall be accessible for inspection by the Issuer and the Owner Trustee at any time during normal business hours. SECTION 3. COMPENSATION. As compensation for the performance of the Administrator's obligations under this Agreement and as reimbursement for its expenses related thereto, the Administrator shall be entitled to a monthly fee which shall be solely an obligation of the Trust Depositor and shall be in an amount as shall be agreeable to the Trust Depositor and the Administrator. - 8 - SECTION 4. ADDITIONAL INFORMATION TO BE FURNISHED TO THE ISSUER. The Administrator shall furnish to the Issuer from time to time such additional information regarding the Collateral as the Issuer shall reasonably request. SECTION 5. INDEPENDENCE OF THE ADMINISTRATOR. For all purposes of this Agreement, the Administrator shall be an independent contractor and shall not be subject to the supervision of the Issuer or the Owner Trustee with respect to the manner in which it accomplishes the performance of its obligations hereunder. Unless expressly authorized by the Issuer, the Administrator shall have no authority to act for or represent the Issuer or the Owner Trustee in any way and shall not otherwise be deemed an agent of the Issuer or the Owner Trustee. SECTION 6. NO JOINT VENTURE. Nothing contained in this Agreement (i) shall constitute the Administrator and either of the Issuer or the Owner Trustee as members of any partnership, joint venture, association, syndicate, unincorporated business or other separate entity, (ii) shall be construed to impose any liability as such on any of them or (iii) shall be deemed to confer on any of them any express, implied or apparent authority to incur any obligation or liability on behalf of the others. SECTION 7. OTHER ACTIVITIES OF ADMINISTRATOR. Nothing herein shall prevent the Administrator or its Affiliates from engaging in other business or, in its sole discretion, from acting in a similar capacity as an administrator for any other Person or entity even though such person or entity may engage in business activities similar to those of the Issuer, the Owner Trustee or the Indenture Trustee. SECTION 8. TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR. This Agreement shall continue in force until the termination of the Issuer, upon which event this Agreement shall automatically terminate. (a) Subject to Section 8(d) and Section 8(e), the Administrator may resign its duties hereunder by providing the Issuer with at least 60 days' prior written notice. (b) Subject to Section 8(d) and Section 8(e), the Issuer may remove the Administrator without cause by providing the Administrator with at least 60 days' prior written notice. (c) Subject to Section 8(d) and Section 8(e), at the sole option of the Issuer, the Administrator may be removed immediately upon written notice of termination from the Issuer to the Administrator if any of the following events shall occur: (i) the Administrator shall default in the performance of any of its duties under this Agreement and, after notice of such default, shall not cure such default within ten days (or, if - 9 - such default cannot be cured in such time, shall not give within ten days such assurance of cure as shall be reasonably satisfactory to the Issuer); (ii) a court having jurisdiction in the premises shall enter a decree or order for relief, and such decree or order shall not have been vacated within 60 days, in respect of the Administrator in any involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect or appoint a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for the Administrator or any substantial part of its property or order the winding-up or liquidation of its affairs; or (iii) the Administrator shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case under any such law, or shall consent to the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator or similar official for the Administrator or any substantial part of its property, shall consent to the taking of possession by any such official of any substantial part of its property, shall make any general assignment for the benefit of creditors or shall fail generally to pay its debts as they become due. The Administrator agrees that if any of the events specified in clauses (ii) or (iii) above shall occur, it shall give written notice thereof to the Issuer and the Indenture Trustee within seven days after the occurrence of such event. (d) No resignation or removal of the Administrator pursuant to this Section shall be effective until (i) a successor Administrator shall have been appointed by the Issuer and (ii) such successor Administrator shall have agreed in writing to be bound by the terms of this Agreement in the same manner as the Administrator is bound hereunder. (e) The appointment of any successor Administrator shall be effective only after the satisfaction of the Rating Agency Condition with respect to the proposed appointment. (f) Subject to Section 8(d) and 8(e), the Administrator acknowledges that upon the appointment of a Successor Servicer pursuant to the Sale and Servicing Agreement, the Administrator shall immediately resign and such Successor Servicer shall automatically become the Administrator under this Agreement. SECTION 9. ACTION UPON TERMINATION, RESIGNATION OR REMOVAL. Promptly upon the effective date of termination of this Agreement pursuant to Section 8 or the resignation or removal of the Administrator pursuant to Section 8(a), (b) or (c) respectively, the Administrator shall be entitled to be paid all fees and reimbursable expenses accruing to it to the date of such termination, resignation or removal. The Administrator shall forthwith upon such termination pursuant to Section 8 deliver to the Issuer all property and documents of or relating to the - 10 - Collateral then in the custody of the Administrator. In the event of the resignation or removal of the Administrator pursuant to Section (a), (b) or (c), respectively, the Administrator shall cooperate with the Issuer and take all reasonable steps requested to assist the Issuer in making an orderly transfer of the duties of the Administrator. SECTION 10. NOTICES. All notices, demands, certificates, requests and communications hereunder ("notices") shall be in writing and shall be effective (a) upon receipt when sent through the U.S. mails, registered or certified mail, return receipt requested, postage prepaid, with such receipt to be effective the date of delivery indicated on the return receipt, or (b) one Business Day after delivery to an overnight courier, or (c) on the date personally delivered to an Authorized Officer of the party to which sent, or (d) on the date transmitted by legible telecopier transmission with a confirmation of receipt, in all cases addressed to the recipient at the address for such recipient set forth in the Sale and Servicing Agreement. Each party hereto may, by notice given in accordance herewith to each of the other parties hereto, designate any further or different address to which subsequent notices shall be sent. SECTION 11. AMENDMENTS. This Agreement may be amended from time to time by a written amendment duly executed and delivered by the parties hereto, with the written consent of the Owner Trustee but without the consent of the Noteholders, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders; provided that such amendment will not, in the Opinion of Counsel satisfactory to the Indenture Trustee, materially and adversely affect the interest of any Noteholder. This Agreement may also be amended by the parties hereto with the written consent of the Owner Trustee and the Required Holders for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of Noteholders; PROVIDED, HOWEVER, that no such amendment may (i) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on the Contracts or distributions that are required to be made for the benefit of the Noteholders or (ii) reduce the aforesaid percentage of the holders of Notes which are required to consent to any such amendment, without the consent of the holders of all outstanding Notes. Notwithstanding the foregoing, the Administrator may not amend this Agreement without the permission of the Trust Depositor, which permission shall not be unreasonably withheld. SECTION 12. SUCCESSORS AND ASSIGNS. This Agreement may not be assigned by the Administrator unless such assignment is previously consented to in writing by the Issuer, the Indenture Trustee and the Owner Trustee and subject to the satisfaction of the Rating Agency Condition in respect thereof. An assignment with such consent and satisfaction, if accepted by the assignee, shall bind the assignee hereunder in the same manner as the Administrator is bound hereunder. Notwithstanding the foregoing, this Agreement may be assigned by the - 11 - Administrator without the consent of the Issuer or the Owner Trustee to a corporation or other organization that is a successor (by merger, consolidation or purchase of assets) to the Administrator; provided that such successor organization executes and delivers to the Issuer, the Owner Trustee and the Indenture Trustee an agreement, in form and substance reasonably satisfactory to the Owner Trustee and the Indenture Trustee, in which such corporation or other organization agrees to be bound hereunder by the terms of said assignment in the same manner as the Administrator is bound hereunder. Subject to the foregoing, this Agreement shall bind any successors or assigns of the parties hereto. SECTION 13. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. SECTION 14. HEADINGS. The section and subsection headings hereof have been inserted for convenience of reference only and shall not be construed to affect the meaning, construction or effect of this Agreement. SECTION 15. COUNTERPARTS. This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same agreement. SECTION 16. SEVERABILITY. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. SECTION 17. NOT APPLICABLE TO HARLEY-DAVIDSON CREDIT IN OTHER CAPACITIES. Nothing in this Agreement shall affect any obligation Harley-Davidson Credit may have in any other capacity. SECTION 18. LIMITATION OF LIABILITY OF OWNER TRUSTEE AND INDENTURE TRUSTEE. (a) Notwithstanding anything contained herein to the contrary, this instrument has been countersigned by [_____] not in its individual capacity but solely in its capacity as Owner Trustee of the Issuer and in no event shall [_____] in its individual capacity or any beneficial owner of the Issuer have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder, as to all of which recourse shall be had solely to the assets of the Issuer. For all purposes of this Agreement, in the performance of any duties or - 12 - obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles Six, Seven and Eight of the Trust Agreement. (b) Notwithstanding anything contained herein to the contrary, this Agreement has been countersigned by [_____] not in its individual capacity but solely as Indenture Trustee and in no event shall [_____] have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder or in any of the certificates, notices or agreements delivered pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuer. SECTION 19. THIRD-PARTY BENEFICIARY. The Owner Trustee is a third-party beneficiary to this Agreement and is entitled to the rights and benefits hereunder and may enforce the provisions hereof as if it were a party hereto. SECTION 20. SURVIVABILITY. The obligations of the Administrator described in Section 1(a)(ii) hereof shall survive termination of this Agreement. [signature page follows] - 13 - IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered as of the day and year first above written. HARLEY-DAVIDSON MOTORCYCLE TRUST [_____] By: [_____], not in its individual capacity but solely as Owner Trustee By: -------------------------------------------- Printed Name: --------------------- Title: ---------------------------- HARLEY-DAVIDSON CUSTOMER FUNDING CORP., as Trust Depositor By: -------------------------------------------- Printed Name: Title: [_____], not in its individual capacity but solely as Indenture Trustee By: -------------------------------------------- Printed Name: Title: HARLEY-DAVIDSON CREDIT CORP., as Administrator By: -------------------------------------------- Printed Name: Title: Signature Page to Administration Agreement LIMITED POWER OF ATTORNEY State of Illinois ) ) SS. County of Cook ) KNOW ALL PERSONS BY THESE PRESENTS, that [_____], a [_____] (the "OWNER TRUSTEE"), whose principal executive office is located at [_____] Attention: [_____], by and through its duly elected and authorized officer, ________________________, a ___________________, on behalf of itself and of Harley-Davidson Motorcycle Trust [_____] (the "TRUST") as Issuer under the Administration Agreement, dated as of [_____] (the "ADMINISTRATION AGREEMENT"), among the Trust, Harley-Davidson Customer Funding Corp., [_____], as Indenture Trustee, and Harley-Davidson Credit Corp., as Administrator, does hereby nominate, constitute and appoint Harley-Davidson Credit Corp., a Nevada corporation, each of its officers from time to time and each of its employees authorized by it from time to time to act hereunder, jointly and each of them severally, together or acting alone, its true and lawful attorney-in-fact, for the Owner Trustee and the Issuer in their name, place and stead, in the sole discretion of such attorney-in-fact, to perform such calculations and prepare or cause the preparation by other appropriate persons of, and to execute on behalf of the Issuer or the Owner Trustee, all such documents, reports, filings, instruments, certificates and opinions that the Issuer or the Owner Trustee is required to prepare, file or deliver pursuant to the Administration Agreement, and to take any and all other action, as such attorney-in-fact may deem necessary or desirable in accordance with the directions of the Owner Trustee and in connection with its duties as Administrator or successor Administrator under the Administration Agreement. Capitalized terms used herein that are not otherwise defined shall have the meanings ascribed thereto in the Administration Agreement. The Owner Trustee hereby ratifies and confirms the execution, delivery and performance (whether before or after the date hereof) of the above-mentioned documents, reports, filings, instruments, certificates and opinions, by the attorney-in-fact and all that the attorney-in-fact shall lawfully do or cause to be done by virtue hereof. The Owner Trustee hereby agrees that no person or other entity dealing with the attorney-in-fact shall be bound to inquire into such attorney-in-fact's power and authority hereunder and any such person or entity shall be fully protected in relying on such power of authority. This Limited Power of Attorney may not be assigned without the prior written consent of the Owner Trustee. It is effective immediately and will continue until it is revoked. This Limited Power of Attorney shall be governed and construed in accordance with the laws of the State of Illinois without reference to principles of conflicts of law. Executed as of this ___ day of [_____]. [_____], not in its individual capacity but solely as Owner Trustee By: ------------------------------- Printed Name: ----------------------- Title: ------------------------------ CERTIFICATE OF ACKNOWLEDGMENT OF NOTARY PUBLIC State of Delaware ) ) SS. County of New Castle ) On [_____] before me, _________________________________________ [Insert name and title of notary] personally appeared ________________________. / / personally known to me, or / / proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ties), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature: ---------------------------------------- [SEAL] ~~-----END PRIVACY-ENHANCED MESSAGE-----~~