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 November 1, 2005




 


 





 





















 


TABLE OF CONTENTS


 


	
  ARTICLE I DEFINITION

  	
   

  
	
   

  	
   

  
	
  Section 1.01.

  	
  General

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  II TRANSFER OF CONTRACTS; ASSIGNMENT OF AGREEMENT

  	
   

  
	
   

  	
   

  
	
  Section 2.01.

  	
  Closing

  	
   

  
	
  Section 2.02.

  	
  Conditions to the
  Closing

  	
  2

  
	
  Section 2.03.

  	
  Assignment
  of Agreement

  	
  3

  
	
  Section 2.04.

  	
  [Intentionally
  Omitted]

  	
  4

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  III REPRESENTATIONS AND WARRANTIES

  	
  4

  
	
   

  	
   

  
	
  Section 3.01.

  	
  Representations
  and Warranties Regarding Seller

  	
  4

  
	
  Section 3.02.

  	
  Representations
  and Warranties Regarding Each Contract

  	
  5

  
	
  Section 3.03.

  	
  Representations
  and Warranties Regarding the Contracts in the Aggregate

  	
  9

  
	
  Section 3.04.

  	
  Representations
  and Warranties Regarding the Contract Files

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  IV PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS

  	
  10

  
	
   

  	
   

  
	
  Section 4.01.

  	
  Custody of Contracts

  	
  10

  
	
  Section 4.02.

  	
  Filing

  	
  10

  
	
  Section 4.03.

  	
  Name Change or
  Relocation

  	
  11

  
	
  Section 4.04.

  	
  Costs and Expenses

  	
  11

  
	
  Section 4.05

  	
  Sale Treatment

  	
  11

  
	
  Section 4.06

  	
  Separateness from
  Trust Depositor

  	
  11

  
	
  Section 4.07

  	
  Protection
  of Security Interests

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE V
  REMEDIES UPON MISREPRESENTATION

  	
  12

  
	
   

  	
   

  
	
  Section 5.01.

  	
  Repurchases
  of Contracts for Breach of Representations and Warranties

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI INDEMNITIES

  	
  12

  
	
   

  	
   

  
	
  Section 6.01.

  	
  Seller Indemnification

  	
  12

  
	
  Section 6.02.

  	
  Liabilities to
  Obligors

  	
  13

  
	
  Section 6.03.

  	
  Tax
  Indemnification

  	
  13

  
	
  Section 6.04.

  	
  Operation of
  Indemnities

  	
  13

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII
  MISCELLANEOUS

  	
  13

  
	
   

  	
   

  
	
  Section 7.01.

  	
  Prohibited
  Transactions with Respect to the Trust

  	
  13

  
	
  Section 7.02.

  	
  Merger or
  Consolidation

  	
  14

  
	
  Section 7.03.

  	
  Termination

  	
  14

  
	
  Section 7.04.

  	
  Assignment or
  Delegation by Seller

  	
  14

  
	
  Section 7.05.

  	
  Amendment

  	
  14

  
	
  Section 7.06.

  	
  Notices

  	
  15

  
	
  Section 7.07.

  	
  Merger and Integration

  	
  15

  
	
  Section 7.08.

  	
  Headings

  	
  16

  
	
  Section 7.09.

  	
  Governing Law

  	
  16

  



 


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  EXHIBITS

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit A

  	
   

  	
  Form of
  Assignment

  	
  A-1

  
	
  Exhibit B

  	
   

  	
  Form of
  Officer’s Certificate

  	
   

  



 


ii





















 


THIS AGREEMENT,
dated as of November 1, 2005, 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 purchase of Contract Assets
hereunder to convey all right, title and interest in such Contract Assets to
Harley-Davidson Motorcycle Trust 2005-4 (the “Trust”)
pursuant to the Sale and Servicing Agreement dated as of November 1, 2005
by and among Trust Depositor, Harley-Davidson Credit, as Servicer, the Trust,
as issuer (the “Issuer”) and The
Bank of New York Trust Company, N.A., 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 $325,000,000 in cash as the purchase price therefor, (i) all
the right, title and interest of Seller in and to the Contracts listed


 





















 


on the 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 Cutoff Date, including any liquidation proceeds therefrom,
but excluding any rights to receive payments which were collected pursuant
thereto on or prior to the 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), 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 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.


 


(b)           A certificate of an officer of Seller
substantially in the form of Exhibit B
hereto.


 


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(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 Ernst &
Young LLP, 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 Contracts and performed specific procedures for such
sample with respect to certain contract terms and identifying those 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 Trustee and the Issuer and the Indenture Trustee may enforce
directly without joinder of Trust Depositor, the obligations of Seller set
forth herein.


 


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Section 2.04.        [Intentionally Omitted].


 


ARTICLE III


 


REPRESENTATIONS AND WARRANTIES


 


Seller makes the following representations
and warranties, on which Trust Depositor will rely in purchasing the Contract
Assets on the Closing 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, 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
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 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


 


4





















 


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.


 


(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 5.0% 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 that:


 


(a)           List
of Contracts.  The information
set forth in the List of Contracts is true, complete and correct in all
material respects as of the Cutoff Date.


 


(b)           Payments.  As of the Cutoff Date, 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


 


5





















 


by the respective Obligor or under a debt
insurance policy or debt cancellation agreement.


 


(c)           No
Waivers.  As of the Closing
Date, 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, 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, in any material respect any


 


6





















 


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, 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 validly
assigned by Eaglemark Savings Bank to Seller (where applicable) and by Seller
to the Trust Depositor.  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 Cutoff
Date 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 Cutoff
Date , 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


 


7





















 


has not granted any extension of payment
terms on any Contract.  As of the Cutoff
Date, no Motorcycle had been repossessed.


 


(n)           No
Liens.  As of the Closing Date
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.


 


(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 Cutoff
Date, no Obligor was subject to a bankruptcy proceeding (according to the
records of the Seller) within the one year preceding the Cutoff Date.


 


(u)           Chattel
Paper.  The Contracts
constitute tangible chattel paper within the meaning of the UCC.


 


8





















 


(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.


 


(w)          Selection
Criteria.  Each Contract is
secured by a new or used Motorcycle.  No
Contract has a Contract Rate less than 1.99%. 
Each Contract amortizes the amount financed over an original term no
greater than 84 months.  Each Contract
has a Principal Balance of at least $500.00 as of the Cutoff Date.


 


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 and as of the Closing Date that:


 


(a)           Amounts.  The sum of the aggregate Principal Balances
payable by Obligors under the Contracts as of the Cutoff 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.


 


(b)           Characteristics.  The Contracts have the following
characteristics: (i) all the Contracts are secured by Motorcycles; (ii) no
Contract has a remaining maturity of more than 84 months; and (iii) the
final scheduled payment on the Contract with the latest maturity is due no
later than November 2012.   
Approximately 80.85% of the Principal Balance of the Contracts as of the
Cutoff Date is attributable to loans for purchases of new Motorcycles and
approximately 19.15% is attributable to loans for purchases of used
Motorcycles.  No Contract was originated
after the Cutoff Date.  No Contract has a
Contract Rate less than 2.990%. 
Approximately 98.19% of the Principal Balance of the Contracts as of the
Cutoff Date is attributable to loans for purchases of Motorcycles manufactured
by Harley-Davidson or Buell and approximately 1.81% of the Principal Balance of
the Contracts as of the 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, 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.


 


9





















 


(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, 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 11.00% of
the Principal Balance of the Contracts as of the Cutoff Date 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 that:


 


(a)           Possession.  Immediately prior to the Closing 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 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, 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


 


10





















 


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,
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 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, and in any event within 60 days thereof,
certifying that the Seller’s compliance officer has reviewed the original of
each Contract and each related Contract File, that each


 


11





















 


Contract and related Contract
File conforms in all material respects with the List of Contracts and each such
Contract File is complete and that each document required be an original.


 


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 (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.


 


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


 


12





















 


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 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;


 


13





















 


(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.


 


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.


 


14





















 


(b)           This
Agreement may also be amended from time to time by Seller and Trust Depositor,
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 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.


 


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.


 


15





















 


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 States or any State of the
United States.  This Section 7.10
shall survive termination of this Agreement.


 


[signature page follows]


 


16





















 


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:

  	
    /s/

  	
  PERRY A. GLASSGOW

  	
   

  
	
   

  	
   

  	
   

  	
  Printed Name: Perry A. Glassgow

  
	
   

  	
   

  	
   

  	
  Title: Vice President and Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  HARLEY-DAVIDSON CREDIT CORP.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
    /s/

  	
  PERRY A. GLASSGOW

  	
   

  
	
   

  	
   

  	
   

  	
  Printed Name: Perry A. Glassgow

  
	
   

  	
   

  	
   

  	
  Title: Vice President and Treasurer

  



 


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 November 1, 2005 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 Contracts listed on the 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 Cutoff Date, including any liquidation proceeds therefrom,
but excluding any rights to receive payments which were collected pursuant
thereto on or prior to the 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 November 1, 2005 made by and among the
undersigned, as servicer, the Trust Depositor, Harley-Davidson Motorcycle Trust
2005-4, as issuer, and The Bank of New York Trust Company, N.A., as indenture
trustee.


 


A-1





















 


IN WITNESS WHEREOF, the undersigned has
caused this Assignment to be duly executed this       day
of November, 2005.


 


	
   

  	
  HARLEY-DAVIDSON CREDIT CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Printed Name:  Perry A. Glassgow

  
	
   

  	
   

  	
   

  	
  Title: Vice President and Treasurer

  



 


A-2





















 


Exhibit B


Transfer and Sale


Agreement


 


FORM OF
OFFICER’S CERTIFICATE


 


(See Exhibit C to the Sale
and Servicing Agreement)