Document:

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 May 15, 2007

 

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

  	
   

  	
  3

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III REPRESENTATIONS AND WARRANTIES

  	
   

  	
  5

  
	
   

  	
   

  	
   

  
	
  Section
  3.01.

  	
   

  	
  Representations and Warranties Regarding Seller

  	
   

  	
  5

  
	
  Section
  3.02.

  	
   

  	
  Representations and Warranties Regarding Each Contract

  	
   

  	
  6

  
	
  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

  	
   

  	
  11

  
	
   

  	
   

  	
   

  
	
  Section
  4.01.

  	
   

  	
  Custody of Contracts

  	
   

  	
  11

  
	
  Section
  4.02.

  	
   

  	
  Filing

  	
   

  	
  11

  
	
  Section
  4.03.

  	
   

  	
  Name Change or Relocation

  	
   

  	
  11

  
	
  Section
  4.04.

  	
   

  	
  Costs and Expenses

  	
   

  	
  12

  
	
  Section
  4.05

  	
   

  	
  Sale Treatment

  	
   

  	
  12

  
	
  Section
  4.06

  	
   

  	
  Separateness from Trust Depositor

  	
   

  	
  12

  
	
  Section
  4.07

  	
   

  	
  Protection of Security Interests

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V REMEDIES UPON MISREPRESENTATION

  	
   

  	
  12

  
	
   

  	
   

  	
   

  
	
  Section
  5.01.

  	
   

  	
  Repurchases of Contracts for Breach of
  Representations and Warranties

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI INDEMNITIES

  	
   

  	
  13

  
	
   

  	
   

  	
   

  
	
  Section
  6.01.

  	
   

  	
  Seller Indemnification

  	
   

  	
  13

  
	
  Section
  6.02.

  	
   

  	
  Liabilities to Obligors

  	
   

  	
  13

  
	
  Section
  6.03.

  	
   

  	
  Tax Indemnification

  	
   

  	
  13

  
	
  Section
  6.04.

  	
   

  	
  Operation of Indemnities

  	
   

  	
  14

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII MISCELLANEOUS

  	
   

  	
  14

  
	
   

  	
   

  	
   

  
	
  Section
  7.01.

  	
   

  	
  Prohibited Transactions with Respect to the Trust

  	
   

  	
  14

  
	
  Section
  7.02.

  	
   

  	
  Merger or Consolidation

  	
   

  	
  14

  
	
  Section
  7.03.

  	
   

  	
  Termination

  	
   

  	
  14

  
	
  Section
  7.04.

  	
   

  	
  Assignment or Delegation by Seller

  	
   

  	
  15

  
	
  Section
  7.05.

  	
   

  	
  Amendment

  	
   

  	
  15

  
	
  Section
  7.06.

  	
   

  	
  Notices

  	
   

  	
  15

  
	
  Section
  7.07.

  	
   

  	
  Merger and Integration

  	
   

  	
  16

  
	
  Section
  7.08.

  	
   

  	
  Headings

  	
   

  	
  16

  
	
  Section
  7.09.

  	
   

  	
  Governing Law

  	
   

  	
  16

  

 

 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 May 15, 2007, 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 2007-2 (the “Trust”)
pursuant to the Sale and Servicing Agreement dated as of May 15, 2007 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
$688,560,338.13 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 

 1
 

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.

(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 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 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 

 2
 

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.

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 

 3
 

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;

(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 Notes will be rated at least their respective ratings as of
the Closing Date by such Rating Agency;

(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

 4
 

(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 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.

 5
 

(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.

(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 5.00% 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 

 6
 

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, 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 Eaglemark Savings
Bank or such motorcycle dealer, as the case may be, to the Seller without any
fraud or misrepresentation on the part of Eaglemark Savings Bank or, to the
knowledge of the Seller, such motorcycle dealer.

(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, in any
material respect 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.

 7
 

(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 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 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 Motorcycle securing any Contract which are liens prior to, or equal with,
the lien of such Contract.

 8
 

(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.

(w)          Selection Criteria. 
Each Contract is secured by a new or used Motorcycle.  No Contract has a Contract Rate less than 3.899%.  Each Contract amortizes the amount financed
over an original term no greater than 84 months.  Each Contract has a Principal Balance of at
least $510.30 as
of the related 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, in the case of the Initial Contracts, and, if
applicable, as of the applicable Subsequent Transfer Date, in the case of
Subsequent Contracts, that:

 9
 

(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 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 84 months; and (iii) the final scheduled
payment on the Initial Contract with the latest maturity is due not later than
June 2014.  Approximately 79.20% 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 20.80% 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 3.899%.  The last scheduled payment
date of the Contracts (including any Subsequent Contracts) is due not later
than September 2014.  Approximately 99.02% 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 0.98% 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, 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, 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
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:

 10
 

(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 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 

 11
 

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.

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 Distribution Date after the
last day of the calendar month in which the Seller becomes 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
one Business Day prior to such Distribution 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 

 12
 

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 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 covenants and agrees to pay, and to indemnify, defend and hold
harmless the Trust Depositor, the Trust, the Trustees or the Noteholders from,
any taxes that may at any time be asserted against any such Person as a result
of or relating to the transactions contemplated herein and in the other
Transaction Documents, including any sales, gross receipts, gross margin,
general corporation, tangible personal property, Illinois personal property
replacement 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 Depositor, 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 

 13
 

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;

(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 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,

 14
 

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
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/ Lawrence
  G. Hund

  
	
   

  	
   

  	
  Printed Name:
  Lawrence G. Hund

  
	
   

  	
   

  	
  Title: President,
  Chief Operating Officer and Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HARLEY-DAVIDSON CREDIT CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   /s/ Lawrence
  G. Hund

  
	
   

  	
   

  	
  Printed Name:
  Lawrence G. Hund

  
	
   

  	
   

  	
  Title:
  President, Chief Operating Officer and Chief Financial Officer

  

 

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 May 15, 2007 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 May 15, 2007 made by and among
the undersigned, as servicer, the Trust Depositor, Harley-Davidson Motorcycle
Trust 2007-2, 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                            .

	
  

  	
  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)

 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 May 15, 2007 (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 May 15, 2007 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 constitute the Subsequent Contracts to be
transferred pursuant to this Agreement on the subsequent Transfer Date.

 C-1
 

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 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.

 C-2
 

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: Perry A. Glassgow

  
	
   

  	
   

  	
  Title: Vice President and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HARLEY-DAVIDSON CREDIT CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Printed Name: Perry A. Glassgow

  
	
   

  	
   

  	
  Title: Vice President and TreasurerExhibit
10.2

 

SALE AND
SERVICING AGREEMENT

among

HARLEY-DAVIDSON MOTORCYCLE TRUST 2007-2,

as Issuer,

HARLEY-DAVIDSON CUSTOMER FUNDING CORP.,

as Trust Depositor,

HARLEY-DAVIDSON CREDIT CORP.,

as Servicer

and

THE BANK OF NEW YORK TRUST COMPANY, N.A.,

as Indenture Trustee

Dated as of May 15, 2007

 

Table of Contents

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE One DEFINITIONS

  	
   

  	
  1

  
	
  Section
  1.01.

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
  Section
  1.02.

  	
   

  	
  Usage of Terms

  	
   

  	
  20

  
	
  Section
  1.03.

  	
   

  	
  Section References

  	
   

  	
  20

  
	
  Section
  1.04.

  	
   

  	
  Calculations

  	
   

  	
  20

  
	
  Section
  1.05.

  	
   

  	
  Accounting Terms

  	
   

  	
  20

  
	
  ARTICLE Two TRANSFER OF CONTRACTS

  	
   

  	
  20

  
	
  Section
  2.01.

  	
   

  	
  Closing

  	
   

  	
  20

  
	
  Section
  2.02.

  	
   

  	
  Conditions to the Closing

  	
   

  	
  21

  
	
  Section
  2.03.

  	
   

  	
  Conveyance of Subsequent Contracts

  	
   

  	
  22

  
	
  ARTICLE Three REPRESENTATIONS AND WARRANTIES

  	
   

  	
  24

  
	
  Section
  3.01.

  	
   

  	
  Representations and Warranties Regarding the
  Trust Depositor

  	
   

  	
  25

  
	
  Section
  3.02.

  	
   

  	
  Representations and Warranties Regarding the
  Servicer

  	
   

  	
  26

  
	
  ARTICLE Four
  PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS

  	
   

  	
  28

  
	
  Section
  4.01.

  	
   

  	
  Custody of Contracts

  	
   

  	
  28

  
	
  Section
  4.02.

  	
   

  	
  Filing

  	
   

  	
  29

  
	
  Section
  4.03.

  	
   

  	
  Name Change or Relocation

  	
   

  	
  29

  
	
  Section
  4.04.

  	
   

  	
  Costs and Expenses

  	
   

  	
  30

  
	
  ARTICLE Five SERVICING OF CONTRACTS

  	
   

  	
  30

  
	
  Section
  5.01.

  	
   

  	
  Responsibility for Contract Administration

  	
   

  	
  30

  
	
  Section
  5.02.

  	
   

  	
  Standard of Care

  	
   

  	
  30

  
	
  Section
  5.03.

  	
   

  	
  Records

  	
   

  	
  30

  
	
  Section
  5.04.

  	
   

  	
  Inspection

  	
   

  	
  30

  
	
  Section
  5.05.

  	
   

  	
  Trust Accounts

  	
   

  	
  31

  
	
  Section
  5.06.

  	
   

  	
  Enforcement

  	
   

  	
  32

  
	
  Section
  5.07.

  	
   

  	
  Trustees to Cooperate

  	
   

  	
  33

  
	
  Section
  5.08.

  	
   

  	
  Costs and Expenses

  	
   

  	
  34

  
	
  Section
  5.09.

  	
   

  	
  Maintenance of Security Interests in Motorcycles

  	
   

  	
  34

  
	
  Section
  5.10.

  	
   

  	
  Successor Servicer/Lockbox Agreements

  	
   

  	
  34

  
	
  Section
  5.11.

  	
   

  	
  Separate Entity Existence

  	
   

  	
  34

  
	
  ARTICLE Six THE TRUST DEPOSITOR

  	
   

  	
  35

  
	
  Section
  6.01.

  	
   

  	
  Covenants of the Trust Depositor

  	
   

  	
  35

  
	
  Section
  6.02.

  	
   

  	
  Liability of Trust Depositor; Indemnities

  	
   

  	
  37

  
	
  Section
  6.03.

  	
   

  	
  Merger or Consolidation of, or Assumption of the
  Obligations of, Trust Depositor; Certain Limitations

  	
   

  	
  38

  
	
  Section
  6.04.

  	
   

  	
  Limitation on Liability of Trust Depositor and
  Others

  	
   

  	
  39

  
	
  Section
  6.05.

  	
   

  	
  Trust Depositor Not to Resign

  	
   

  	
  39

  
	
  ARTICLE Seven DISTRIBUTIONS; RESERVE FUND

  	
   

  	
  39

  
	
  Section
  7.01.

  	
   

  	
  Monthly Distributions

  	
   

  	
  39

  
	
  Section
  7.02.

  	
   

  	
  Fees

  	
   

  	
  39

  
	
  Section
  7.03.

  	
   

  	
  Advances; Realization of Carrying Charge

  	
   

  	
  40

  
	
  Section
  7.04.

  	
   

  	
  Interest Reserve Account

  	
   

  	
  40

  
	
  Section
  7.05.

  	
   

  	
  Distributions; Priorities

  	
   

  	
  41

  
	
  Section
  7.06.

  	
   

  	
  Reserve Fund

  	
   

  	
  44

  
	
  Section
  7.07.

  	
   

  	
  Establishment of Pre-Funding Account

  	
   

  	
  45

  

 i
 

 

	
  Section 7.08.

  	
   

  	
  Purchase of Contracts for Breach of
  Representations and Warranties

  	
   

  	
  46

  
	
  Section
  7.09.

  	
   

  	
  Reassignment of Reacquired Contracts

  	
   

  	
  47

  
	
  Section
  7.10.

  	
   

  	
  Servicer’s Purchase Option

  	
   

  	
  47

  
	
  Section
  7.11.

  	
   

  	
  Purchase of Contracts for Breach of Servicing
  Obligations

  	
   

  	
  47

  
	
  ARTICLE Eight EVENTS OF TERMINATION; SERVICE
  TRANSFER 

  	
   

  	
  48

  
	
  Section
  8.01.

  	
   

  	
  Events of Termination

  	
   

  	
  48

  
	
  Section
  8.02.

  	
   

  	
  Waiver of Event of Termination

  	
   

  	
  49

  
	
  Section
  8.03.

  	
   

  	
  Service Transfer

  	
   

  	
  49

  
	
  Section
  8.04.

  	
   

  	
  Successor Servicer to Act; Appointment of
  Successor Servicer

  	
   

  	
  49

  
	
  Section
  8.05.

  	
   

  	
  Notification to Securityholders

  	
   

  	
  50

  
	
  Section
  8.06.

  	
   

  	
  Effect of Transfer

  	
   

  	
  50

  
	
  Section
  8.07.

  	
   

  	
  Database File

  	
   

  	
  50

  
	
  Section
  8.08.

  	
   

  	
  Successor Servicer Indemnification

  	
   

  	
  50

  
	
  Section
  8.09.

  	
   

  	
  Responsibilities of the Successor Servicer

  	
   

  	
  50

  
	
  Section
  8.10.

  	
   

  	
  Limitation of Liability of Servicer

  	
   

  	
  51

  
	
  Section
  8.11.

  	
   

  	
  Merger or Consolidation of Servicer

  	
   

  	
  51

  
	
  Section
  8.12.

  	
   

  	
  Servicer Not to Resign

  	
   

  	
  51

  
	
  Section
  8.13.

  	
   

  	
  Appointment of Subservicer

  	
   

  	
  52

  
	
  ARTICLE Nine REPORTS 

  	
   

  	
  52

  
	
  Section
  9.01.

  	
   

  	
  Monthly Reports

  	
   

  	
  52

  
	
  Section
  9.02.

  	
   

  	
  Officer’s Certificate

  	
   

  	
  52

  
	
  Section
  9.03.

  	
   

  	
  Other Data

  	
   

  	
  52

  
	
  Section
  9.04.

  	
   

  	
  Report on Assessment of Compliance with Servicing
  Criteria and Attestation; Annual Officer’s Certificate

  	
   

  	
  52

  
	
  Section
  9.05.

  	
   

  	
  Monthly Reports to Noteholders

  	
   

  	
  53

  
	
  ARTICLE Ten TERMINATION 

  	
   

  	
  56

  
	
  Section
  10.01.

  	
   

  	
  Sale of Trust Assets

  	
   

  	
  56

  
	
  ARTICLE Eleven
  MISCELLANEOUS 

  	
   

  	
  56

  
	
  Section
  11.01.

  	
   

  	
  Amendment

  	
   

  	
  56

  
	
  Section
  11.02.

  	
   

  	
  Protection of Title to Trust

  	
   

  	
  58

  
	
  Section
  11.03.

  	
   

  	
  Governing Law

  	
   

  	
  59

  
	
  Section
  11.04.

  	
   

  	
  Notices

  	
   

  	
  59

  
	
  Section
  11.05.

  	
   

  	
  Severability of Provisions

  	
   

  	
  61

  
	
  Section
  11.06.

  	
   

  	
  Assignment

  	
   

  	
  61

  
	
  Section
  11.07.

  	
   

  	
  Third Party Beneficiaries

  	
   

  	
  61

  
	
  Section
  11.08.

  	
   

  	
  Counterparts

  	
   

  	
  61

  
	
  Section
  11.09.

  	
   

  	
  Headings

  	
   

  	
  61

  
	
  Section
  11.10.

  	
   

  	
  No Bankruptcy Petition; Disclaimer and
  Subordination

  	
   

  	
  61

  
	
  Section
  11.11.

  	
   

  	
  Limitation of Liability of Owner Trustee and
  Indenture Trustee

  	
   

  	
  62

  

 

 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

  	
   

  	
  Reserved

  	
   

  	
  D-1

  
	
  Exhibit E 

  	
   

  	
  Servicing Criteria to be Addressed in Indenture Trustee’s
  Assessment of Compliance 

  	
   

  	
  E-1 

  
	
  Exhibit F

  	
   

  	
  Form of Indenture Trustee’s Annual Certificate

  	
   

  	
  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 May 15, 2007, among Harley-Davidson
Motorcycle Trust 2007-2 (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”), The Bank of New
York Trust Company, N.A. (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 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.

 1
 

“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, and shall include, solely in respect of a
Distribution Date in connection with a Mandatory Redemption, any amount
remaining on deposit in the Pre-Funding Account on the Distribution Date on or
immediately following the last day of the Funding Period after giving effect to
the Issuer’s acquisition of Subsequent Contracts.

“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 Purchase 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 Servicer in connection with an optional purchase of the Contracts
pursuant to Section 7.10, (vi) the interest component of the aggregate of the
Purchase Prices for Contracts purchased by the Servicer pursuant to Section
7.11, (vii) all amounts received in respect of Carrying Charges transferred
from the Interest Reserve Account pursuant to Section 7.03, and (viii) 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 Purchase Prices for Contracts
reacquired by the Trust Depositor pursuant to Section 7.08, (iv) the principal
component of all amounts paid by the Servicer in connection with an optional
purchase of the Contracts pursuant to Section 7.10, and (v) the principal
component of the aggregate of the Purchase Prices for Contracts purchased by
the Servicer pursuant to Section 7.11.

“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.  

“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
May 14, 2007 relating to the Harley-Davidson Motorcycle Trusts.

“Buell” means Buell Motorcycle Company, LLC.

 2
 

“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, the Class A-3 Rate, the Class A-4 Rate,
the Class B Rate and the Class C Rate for the related Interest Period (with each
such rate being multiplied by the number of days in the Interest Period related
to the applicable Class of Notes divided by 360) 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 Noteholder” means the Person in whose
name a Class A Note is registered in the Note Register, as such term is defined
in the Indenture.

“Class A Notes” means, collectively, the Class A-1 Notes,
the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes.

“Class A-1 Final Distribution Date” means the May 2008
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 5.31030% per annum (computed on the
basis of the actual number of days elapsed and a 360-day year).

“Class A-2 Final Distribution Date” means the December 2010
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 5.26% per annum (computed on the basis
of a 360-day year of twelve 30-day months).

 3
 

“Class A-3 Final Distribution Date” means the May 2012
Distribution Date.

“Class A-3 Noteholder” means the Person in whose
name a Class A-3 Note is registered in the Note Register.

“Class A-3 Rate” means 5.10% per annum (computed on the basis
of a 360-day year of twelve 30-day months).

“Class A-4 Final Distribution Date” means the August 2013
Distribution Date.

“Class A-4 Noteholder” means the Person in whose
name a Class A-4 Note is registered in the Note Register.

“Class A-4 Rate” means 5.12% per annum (computed on the basis
of a 360-day year of twelve 30-day months).

“Class B Final Distribution Date” means the March 2014
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.

“Class B Rate” means 5.23% per annum (computed on the basis
of a 360-day year of twelve 30-day months).

“Class C Final Distribution Date” means the August 2015
Distribution Date.

“Class C Noteholder” means the Person in whose
name a Class C Note is registered in the Note Register, as such term is defined
in the Indenture.

“Class C Rate” means 5.41% 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 May 22, 2007.

“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
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.

 4
 

“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.

“Controlling Class” means the Class A Notes
(voting together as a single class, if applicable) for so long as any Class A
Notes are outstanding, then the Class B Notes for so long as any Class B Notes
are outstanding, and then the Class C Notes for so long as any Class C Notes
are outstanding.

“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.

“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, 

 5
 

(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 Business Day, with the first such Distribution Date
hereunder being June 15, 2007.

“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 May 31, 2007.

“Eligible Account” means a segregated 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;

 6
 

(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
and reverse repurchase agreements collateralized by securities issued or
guaranteed by the United States government or any agency, instrumentality or
establishment of the United States government (“Government Securities”), in either case entered into with a
depository institution or trust company (acting as principal) described in clause
(b), or entered into with an entity (acting as principal) which has, or
whose parent has, a credit rating from the Rating Agency in the highest credit
category granted thereby; 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.

“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.

“Exchange Act” means the
Securities Exchange Act of 1934, as amended.

“Final Distribution Date” means the Class A-1 Final
Distribution Date, the Class A-2 Final Distribution Date, the Class A-3 Final
Distribution Date, the Class A-4 Final Distribution Date, the Class B Final
Distribution Date or the Class C Final Distribution Date, as the case may be.

“First Priority Principal Distributable Amount” means, with
respect to any Distribution Date, an amount, not less than zero, equal to the
result of (a) the aggregate Outstanding Amount of the Class A Notes
as of the preceding Distribution Date (after giving effect to any principal
payments made on the Class A Notes on that preceding Distribution Date),
minus (b) the Aggregate Principal
Balance at the end of Due Period related to that Distribution Date; provided,
however, that the First Priority Principal 

 7
 

Distributable
Amount shall not exceed the Outstanding Amount of the Class A Notes (after
giving effect to any principal payments made on the Class A Notes on that
preceding Distribution Date).

“Form 10-D Disclosure Item” means with respect to any Person, any litigation or governmental
proceedings pending against such Person, or any of the Issuer, the Seller, the
Indenture Trustee, the Owner Trustee or the Servicer of such Person, or in the
case of the Owner Trustee or Indenture Trustee, a Responsible Officer of such
Person, has actual knowledge thereof, in each case that would be material to
the Noteholders.

“Form 10-K Disclosure Item” means with respect to any Person, (a) any Form 10-D Disclosure Item,
(b) any affiliations between such Person and the Seller, the Servicer, the
Trust Depositor, the Owner Trustee and the Indenture Trustee (each, an “Item
1119 Party”), to the extent such
Person, or in the case of the Owner Trustee or Indenture Trustee, a Responsible
Officer of such Person, has actual knowledge thereof and (c) any relationships
or transactions between such Person and any Item 1119 Party that are outside
the ordinary course of business or on terms other than would be obtained in an
arm’s-length transaction with an unrelated third party, apart from the
transactions contemplated under the Transaction Documents, and that are
material to the investors’ understanding of the Notes, but only to the extent
such Person, or in the case of the Owner Trustee or Indenture Trustee, a
Responsible Officer of such Person, has actual knowledge of such relationships
or transactions.

“Funding Period” means the period beginning on the Closing
Date and ending on the first to occur of (a) the 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 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 0.00225% 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 

 8
 

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 $138,000,000.

“Initial Class A-2 Note Balance” means $285,000,000.

“Initial Class A-3 Note Balance” means $245,000,000.

“Initial Class A-4 Note Balance” means $194,125,000.

“Initial Class B Note Balance” means $61,750,000.

“Initial Class C Note Balance” means $26,125,000.

“Initial Contracts” means those Contracts
conveyed to the Trust on the Closing Date.

“Initial Cutoff Date” means as of the close of business on May 5,
2007.

“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 (i) with respect to any Distribution
Date and the Class A-1 Notes, the period from and including 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 such
Distribution Date and (ii) with respect to any Distribution Date and the Notes
(other than the Class A-1 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.

 9
 

“Interest Rate” means the Class A-1 Rate, the Class A-2 Rate,
the Class A-3 Rate, the Class A-4 Rate, the Class B Rate or the Class C 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 $2,079,534.64.

“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).

“Issuer” means the Harley-Davidson Motorcycle Trust
2007-2.

“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, Bank One, National Association and The Bank of New York Trust Company,
National Association, with 

 10
 

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.

“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 related 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 Noteholders
evidencing at least 66 2/3% of the aggregate Outstanding Amount of the
Controlling Class.

“Monthly Report” shall have the meaning specified in Section
9.05.

“Monthly Servicing Fee” means, as to any
Distribution Date, one-twelfth of the product of 1.00% and the Principal
Balance of the Contracts as of the beginning of the related Due Period or, with
respect to the first Distribution Date after the Closing Date, 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 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.

“Noteholder” shall have the
meaning specified in the Indenture.

“Note Depository Agreement” shall have the meaning
specified in the Indenture.

 11
 

“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 for
the related Interest Period at the applicable 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, as of the close of
any Distribution Date, the excess of the Note Principal Distributable Amount
with respect to such Distribution Date over the amount in respect of principal
that is actually deposited in the Note Distribution Account on such
Distribution Date.

“Note Principal Distributable Amount” means, with respect to any
Distribution Date, the sum of (x) the Principal Distributable Amount with
respect to such Distribution Date and 
(y) the Note Principal Carryover Shortfall as of the close of the
immediately preceding Distribution Date, minus the aggregate amount of the First
Priority Distributable Amount and the Second Priority Distributable Amount
distributed on such Distribution Date; provided, however,
that the Note Principal Distributable Amount shall not exceed the Outstanding
Amount of the Notes (after giving effect to the other amounts to be deposited
in the Note Distribution Account in respect of the First Priority Principal
Distributable Amount and the Second Priority Principal Distributable Amount on
such Distribution Date); and provided, further,
that the 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 Amount of the Class A-1 Notes to zero,
(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 

 12
 

Date
and allocable to principal) to reduce the Outstanding Amount of the Class A-2
Notes to zero, (iii) on the Class A-3 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-3 Notes
on such Distribution Date and allocable to principal) to reduce the Outstanding
Amount of the Class A-3 Notes to zero, (iv) on the Class A-4 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-4 Notes on such Distribution Date and allocable to principal) to
reduce the Outstanding Amount of the Class A-4 Notes to zero, (v) on the Class
B Final Distribution Date shall not be less than the amount that is necessary
(after giving effect to the 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 Amount on the Class B
Notes to zero, and (vi) on the Class C Final Distribution Date shall not be
less than the amount that is necessary (after giving effect to the other
amounts to be deposited in the Note Distribution Account for payment on the
Class C Notes on such Distribution Date and allocable to principal) to reduce
the Outstanding Amount on the Class C notes to zero.

“Notes”
means the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the Class
A-4 Notes, the Class B Notes and the Class C 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.

 13
 

“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.

“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 is purchased by the Servicer pursuant to
Section 7.11 hereof, or if (y) the Servicer gives notice of its intent to
purchase the Contracts in connection with an optional termination of the Trust
pursuant to 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.

“Purchase
Price” means, with respect to a Contract to be reacquired or
purchased 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.

“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 

 14
 

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.

“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.

“Record Date” means, with respect to any Distribution
Date, the close of business on the day immediately preceding such Distribution
Date.

“Regulation AB” means Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R. Sections
229.1100-229.1123, as amended from time to time and as clarified and interpreted
by the Securities and Exchange Commission or its staff from time to time.

“Reimbursement
Amount” has the meaning assigned in Section 7.03 hereof.

“Required Holders” means Noteholders
evidencing more than 50% of the aggregate Outstanding Amount of the Controlling
Class.

“Reportable Event” means
any event required to be reported on Form 8-K.

“Reserve Fund” means the Reserve Fund established and
maintained pursuant to Section 7.06 hereof.

“Reserve Fund Initial Deposit” means $1,721,400.85.

“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) 2.50% 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) 3.00% 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) 3.50% 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) 4.00% 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) 4.00% 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) 3.75% with
respect to 

 15
 

any
Distribution Date which occurs following the second anniversary of the Closing
Date;  or (iii) the Cumulative Loss Ratio
for such Distribution Date is equal to or greater than (a) 1.75% 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) 2.75% 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) 3.75% 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) 4.00% 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 Indenture 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.

“Second Priority Principal Distributable Amount” means, with
respect to any Distribution Date, an amount, not less than zero, equal to the
result of (a) the aggregate Outstanding Amount of the Class A Notes
and Class B Notes as of the preceding Distribution Date (after giving effect to
any principal payments made on the Class A Notes and Class B Notes on that
preceding Distribution Date), minus (b) the sum of (i) the amount of
principal distributed in respect of the First Priority Principal Distributable
Amount on such Distribution Date and (ii) the Aggregate Principal Balance at the end of Due Period related to
that Distribution Date; provided, however, that the Second
Priority Principal Distributable Amount shall not exceed the Outstanding Amount
of the Class A Notes and Class B Notes after giving effect to the other amounts
distributable in respect of principal on the Class A Notes and Class B Notes to
be deposited in the Note Distribution Account in respect of the First Priority
Principal Distributable Amount on such Distribution Date).

“Securities” means the Notes, or any of them.

“Securities Act” means the
Securities Act of 1933, as amended.

“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.

 16
 

“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 Criteria” means the “servicing criteria” set forth
in Item 1122(d) of Regulation AB.

“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.

“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, an amount equal to the excess (if any) of (a)
the sum of the amounts payable pursuant to (1) clauses (v) through (x) of
Section 7.05(a), (2) clauses (i) through (vi) of Section 7.05(b) or (3) clauses
(i) through (vi) of Section 7.05(c), as applicable, over (b) 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)           1.50% 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 6.00% of the Principal Balance
of the Contracts in the Trust as of the last day of the immediately preceding
Due Period; and

(b)           1.00% of the aggregate of
the Initial Class A-1 Note Balance, Initial Class A-2 Note Balance, Initial
Class A-3 Note Balance, Initial Class A-4 Note Balance, Initial Class B Note
Balance and Initial Class C Note Balance;

 17
 

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, Inc., or any successor
thereto.

“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 0.25% of the aggregate balance of the
Subsequent Contracts (as of the related Subsequent Cutoff Dates) 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 May
15, 2007.

“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.

 18
 

“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 May
1, 2007, 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” has the meaning set forth in the
Underwriting Agreement.

“Underwriting Agreement” means the Underwriting
Agreement, dated May 15, 2007, by and among the Trust Depositor, the Seller and
the Underwriters.

“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.

“WTC” means Wilmington Trust Company, in its
individual capacity.

 19
 

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 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

 20

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 in form and substance
reasonably satisfactory to the Underwriters (and including as an addressee
thereof each Rating Agency).

(d)           A
letter or letters from Ernst & Young LLP, 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.

(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.

 21
 

(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
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 

 22
 

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;

(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 Notes will be rated at least
their respective ratings as of the Closing Date by such Rating Agency;

(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;

 23
 

(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 12.38% 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 74 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;

(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 $261,439,661.87; 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 

 24
 

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.

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.

 25
 

(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 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.  

 26
 

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, 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.

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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;

(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 in accordance with its customary practices and
procedures, 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.

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(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
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.

 29
 

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 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.

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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
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 Purchase 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 Servicer in connection with an optional purchase of the
Contracts described in Section 7.10;

(vi)          The
aggregate of the Purchase Prices for Contracts purchased by the Servicer as
described in Section 7.11;

(vii)         All
amounts realized in respect of Carrying Charges transferred from the Interest
Reserve Account as contemplated in Section 7.03(b); and

(viii)        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 on deposit in the Pre-Funding Account.

(d)           The Servicer shall direct
the Indenture Trustee, and 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 

 31
 

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 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 “Prime-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 acting as agent for the Trust pursuant to the Lockbox
Agreement 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 a credit card, 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 

 32
 

taking other action permitted by applicable law.  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 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)           Subject to Section 5.02, the
Servicer may grant extensions, rebates or adjustments on a Contract; provided,
however, that if the Servicer extends the date for final payment by the Obligor
of any Contract beyond the Class C Final Distribution Date, it shall promptly
purchase such Contract pursuant to Section 7.11.

(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 

 33
 

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.

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.  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 

 34
 

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)           Existence.  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.

(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.

 35
 

(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, 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.

(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 

 36
 

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, WTC, the
Indenture Trustee and the Servicer from and against any taxes that may at any
time be asserted against any such Person as a result of or relating to the
transactions contemplated herein and in the other Transaction Documents,
including any sales, gross receipts, gross margin, 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 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, WTC, 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, WTC 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 WTC, as the case may be, shall be due to the willful
misfeasance, bad faith or negligence of the Owner Trustee or WTC, as the case may
be, or shall arise from the breach by the Owner Trustee or WTC, 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
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 

 37
 

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 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 

 38
 

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.

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.

 39
 

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).

(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 (or, in the case of the termination of the Funding
Period pursuant to clause (a) of the definition thereof, on the Business Day
prior to the date of such termination) 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)(vii) 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 2007-2 – The Bank of New York Trust Company,
N.A., 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(b) 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

 40

remaining
in the Interest Reserve Account shall be allocated and distributed to the Trust
Depositor; provided that, notwithstanding the foregoing, on the date on which
the Funding Period terminates pursuant to clause (a) of the definition thereof,
any amounts remaining in the Interest Reserve Account (other than the amount
specified in respect of Carrying Charges in accordance with Section 7.03(b))
shall be released to the Trust Depositor on such date.

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 (which amounts are available for payment of such
Mandatory Redemptions and not for any other purpose) which amount shall be paid
in the following order of priority: first, to the Class A-1 Noteholders until
the Class A-1 Notes are paid in full, second, any remaining amount shall be
paid to the Class A-2 Noteholders until the Class A-2 Notes are paid in full,
third, any remaining amount shall be paid to the Class A-3 Noteholders until
the Class A-3 Notes are paid in full, fourth, any remaining amount shall be
paid to the Class A-4 Noteholders until the Class A-4 Notes are paid in full,
fifth, any remaining amount shall be paid to the Class B Noteholders until the
Class B Notes are paid in full, and sixth, any remaining amount shall be paid
to the Class C Noteholders until the Class C Notes are paid in full;

(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 applicable Note Interest Distributable Amount with respect to such
Distribution Date to the Class A Noteholders; 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 the Class A Notes, then the amount in the Note
Distribution Account shall be applied to the Class A-1 Notes, the Class A-2
Notes, the Class A-3 Notes and the Class A-4 Notes, pro rata, on the basis of the Note Interest
Distributable Amount for each such Class of Notes;

(vi)          to the Note Distribution
Account, together with any amounts deposited therein pursuant to Section 7.06,
the First Priority Principal Distributable Amount with respect to such
Distribution Date first, to the Class A-1 Noteholders until the Class A-1 Notes
have been paid in full, second, to the Class A-2 Noteholders until the Class
A-2 Notes have been paid in full, third, to the Class A-3 Noteholders until the
Class A-3 Notes have been paid in full and, fourth, to the Class A-4
Noteholders until the Class A-4 Notes have been paid in full;

 41
 

(vii)         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
to the Class B Noteholders;

(viii)        to the Note Distribution
Account, together with any amounts deposited therein pursuant to Section 7.06,
the Second Priority Principal Distributable Amount with respect to such
Distribution Date, first, to the Class A-1 Noteholders until the Class A-1
Notes have been paid in full, second, to the Class A-2 Noteholders until the
Class A-2 Notes have been paid in full, third, to the Class A-3 Noteholders
until the Class A-3 Notes have been paid in full, fourth, to the Class A-4
Noteholders until the Class A-4 Notes have been paid in full and, fifth, to the
Class B Noteholders until the Class B Notes have been paid in full;

(ix)           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
to the Class C Noteholders;

(x)            to the Note Distribution
Account, together with any amounts deposited therein pursuant to Section 7.06,
the Note Principal Distributable Amount with respect to such Distribution Date,
first, to the Class A-1 Noteholders until the Class A-1 Notes have been paid in
full, second, to the Class A-2 Noteholders until the Class A-2 Notes have been
paid in full, third, to the Class A-3 Noteholders until the Class A-3 Notes
have been paid in full, fourth, to the Class A-4 Noteholders until the Class
A-4 Notes have been paid in full, fifth, to the Class B Noteholders until the
Class B Notes have been paid in full and, sixth, to the Class C Noteholders
until the Class C Notes have been paid in full;

(xi)           any Excess Amounts to the
Reserve Fund up to the Specified Reserve Fund Balance; and

(xii)          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):

(i)            to the Note Distribution
Account, together with any amounts deposited therein pursuant to Section 7.06,
the applicable Note Interest Distributable Amount with respect to such
Distribution Date to the Class A Noteholders; 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 the Class A Notes, then the amount in the Note
Distribution Account shall be applied to the Class A-1 Notes, the Class A-2
Notes, Class A-3 Notes and the Class A-4 Notes, pro rata,
on the basis of the Note Interest Distributable Amount for each such Class of
Notes;

(ii)           to the Note Distribution
Account, together with any amounts deposited therein pursuant to Section 7.06,
the First Priority Principal Distributable Amount with respect to such
Distribution Date first, to the Class A-1 Noteholders until the Class A-1 Notes
have been paid in 

 42
 

full and, second, to the Class A-2 Noteholders, Class A-3 Noteholders
and Class A-4 Noteholders, pro rata,  based on the outstanding principal amount
of the related Classes of Notes, until such Classes of Notes have been paid in
full;

(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
to the Class B Noteholders;

(iv)          to the Note Distribution
Account, together with any amounts deposited therein pursuant to Section 7.06,
the Second Priority Principal Distributable Amount with respect to such
Distribution Date first, to the Class A-1 Noteholders until the Class A-1 Notes
have been paid in full, second, to the Class A-2 Noteholders, Class A-3
Noteholders and Class A-4 Noteholders, pro
rata,  based on the
outstanding principal amount of the related Classes of Notes, until such
Classes of Notes have been paid in full and, third, to the Class B Noteholders
until the Class B Notes have been paid in full;

(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
to the Class C Noteholders;

(vi)          to the Note Distribution
Account, together with any amounts deposited therein pursuant to Section 7.06,
all amounts remaining after distribution of amounts in clauses (i), (ii),
(iii), (iv) and (v) above to each Class of Notes shall be allocated in the
following order of priority:

(1)           to the Class A Notes, first,
to the Class A-1 Noteholders, until the outstanding principal balance of the
Class A-1 Notes has been paid in full and, second, to the Class A-2
Noteholders, Class A-3 Noteholders and Class A-4 Noteholders, pro rata,
based on the outstanding principal amount of the related Classes of
Notes, until the outstanding principal balance of each such Class of the Notes
has been paid in full;

(2)           to the Class B Notes, until
the outstanding principal balance of the Class B Notes has been paid in full;
and

(3)           to the Class C Notes, until
the outstanding principal balance of the Class C Notes has been paid in full; and

(vii)         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 applicable Note Interest Distributable Amount with respect to such
Distribution Date to the Class A Noteholders; provided,
however, that if there are insufficient funds on deposit in the Note
Distribution Account to pay the entire amount of the Note Interest 

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Distributable Amount for the Class A Notes, then the amount in the Note
Distribution Account shall be applied to the Class A-1 Notes, the Class A-2
Notes, the Class A-3 Notes and the Class A-4 Notes, pro rata,
on the basis of the Note Interest Distributable Amount for each 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 amounts in clause (i) above for
distribution to the Class A Noteholders first, to the Class A-1 Noteholders
until the Class A-1 Notes have been paid in full and, second, to the Class A-2
Noteholders, Class A-3 Noteholders and Class A-4 Noteholders, pro rata, based on the outstanding
principal amount of the related Classes of Notes, until such Classes of Notes
have been paid in full;

(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,
all amounts remaining after distribution of amounts in clauses (i), (ii) and
(iii) above, for distribution to the Class B Noteholders in reduction of the
outstanding principal balance of the Class B Notes until the outstanding
principal balance of the Class B Notes has been paid in full;

(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 distribution to the Class C Noteholders;

(vi)          to the Note Distribution
Account, together with any amounts deposited therein pursuant to Section 7.06,
all amounts remaining after distribution of amounts in clauses (i) through (v)
above, for distribution to the Class C Noteholders in reduction of the outstanding
principal balance of the Class C Notes until the outstanding principal balance
of the Class C Notes has been paid in full; and

(vii)         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 

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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 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 2007-2 — The Bank of New York Trust Company, N.A., 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.

 45
 

(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 after giving effect to any reductions in the
Pre-Funded Amount on such Distribution Date or Determination Date pursuant to
paragraph (b) 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,
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,
then for payment of principal of the Class A-2 Notes up to the Outstanding
Amount thereof, then for payment of principal of the Class A-3 Notes up to
the Outstanding Amount thereof, then for payment of principal of the
Class A-4 Notes up to the Outstanding Amount thereof, then for payment of
principal of the Class B Notes up to the Outstanding Amount thereof and then
for payment of principal of the Class C Notes up to the Outstanding Amount
thereof.

Section 7.08.        Purchase 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 Purchase Price, not later
than two Business Days prior to the first Distribution Date after the last day
of the calendar month in which the Seller becomes 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 prior to the first Distribution Date after the last day of the calendar
month in which the Seller becomes aware of such inaccuracy, 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.  The sole remedy of the Issuer, the Trustees
or the Noteholders against the Seller with respect to a breach of a
representation or warranty of the Seller shall be to require the Seller to
reacquire the related Contract pursuant to this Section 7.08.

 46
 

Section 7.09.        Reassignment of Reacquired
Contracts.  Upon receipt by the Indenture Trustee for
deposit in the Collection Account of the Purchase Price as described in Section
7.08, Section 7.10 or Section 7.11, 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 or the Servicer, as applicable, all of
the Trust’s right, title and interest in the reacquired or purchased 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.        Servicer’s Purchase Option.  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 (i) the Pool Balance as of the Initial Cutoff Date and
(ii) the aggregate Principal Balance of the Subsequent Contracts as of their
related Subsequent Cutoff Dates, the Servicer 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 purchase.  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 Servicer.

Section 7.11.        Purchase of Contracts for Breach of Servicing Obligations.  Upon
a discovery by the Servicer or the Trustees of a breach of any of the covenants
of the Servicer set forth in Section 5.02, 5.06 or 5.09 that materially
adversely affects the Trust’s interest in a 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 Servicer of any of such covenants.  The Servicer, in accordance with this Section
7.11, shall purchase such Contract at its Purchase Price, two Business Days
prior to the first Distribution Date after the last day of the calendar month
in which the Servicer becomes aware, or receives written notice from the
Trustees of any breach described in the preceding sentence which breach has not
been cured; provided, however,
that with respect to a breach of any of the covenants of the Servicer set forth
in Section 5.02, 5.06 or 5.09 relating to the Contracts in the aggregate and
not to any particular Contract the Servicer may select Contracts (without
adverse selection) to purchase such that had such Contracts not been included
as part of the Trust Corpus there would have been no breach of such
covenant.  Notwithstanding any other
provision of this Agreement, the obligation of the Servicer described in this
Section 7.11 shall not terminate or be deemed released by any party hereto upon
a Service Transfer pursuant to Article VIII. 
The purchase obligation described in this Section 7.11 is in no way to
be satisfied with monies in the Reserve Fund. 
Upon Servicer’s payment of the Purchase Price of the Contract, any Event
of Termination pursuant to Section 8.01(b) arising as a result of the Servicer’s
breach of any of the covenants set forth in Section 5.02, 5.06 or 5.09 with
respect to such Contract shall be deemed not to have occurred.

 47
 

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
to make any payment or deposit required to be made under the Notes 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 a Servicing Officer discovers
such failure or the Indenture Trustee provides written notice of such failure
to the Servicer;

(b)           Failure on the Servicer’s
part to observe or perform in any material respect any covenant or agreement in
this Agreement or in the Transfer and Sale Agreement (other than a covenant or
agreement, the breach of which is specifically addressed elsewhere in this
Section) which failure shall (i) materially and adversely affect the
rights of Noteholders and (ii) continue unremedied for a period of 60 days
after the date on which written notice of such failure, requiring the same to
be remedied, shall have been given (A) to the Servicer by the Owner Trustee or
the Indenture Trustee or (B) to the Servicer, and to the Indenture Trustee by
the Holders of Notes, evidencing not less than 25% of the Outstanding Amount of
the Notes;

(c)           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;

(d)           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;

(e)           Any representation, warranty
or statement of the Servicer made in this 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 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.

 48
 

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 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; provided, however, that the Indenture Trustee shall not be
required to make payment for compensation or any other payment in order to
effectuate 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.

 49
 

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.

(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) 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.

 50
 

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, 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 

 51
 

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 deliver to the Trustees and each Rating
Agency 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.        Report on Assessment of
Compliance with Servicing Criteria and Attestation; Annual Officer’s
Certificate.

(a)  The Servicer will:

(i)            deliver to the Indenture
Trustee and each Rating Agency within 90 days after the end of each calendar
year a report on its assessment of compliance with the servicing criteria applicable
to it during the preceding calendar year, including disclosure of any material
instance of non-compliance identified by the Servicer, as required by Rule
13a-18 and 15d-18 of the Exchange Act and Item 1122 of Regulation AB under the
Securities Act;

(ii)           cause a firm of registered
public accountants that is qualified and independent within the meaning of Rule
2-01 of Regulation S-X under the Securities Act to deliver to the Indenture
Trustee and each Rating Agency within 90 days after the end of each calendar
year an attestation report that satisfies the requirements of Rule 13a-18 or
Rule 15d-18 under the Exchange Act and Item 1122 of Regulation AB, as
applicable, on the Servicer’s assessment of compliance with servicing criteria
with respect to the prior calendar year; and

(iii)          deliver to the Indenture
Trustee and each Rating Agency within 90 days after the end of each calendar
year, an Officer’s Certificate to the effect that (i) a review of the Servicer’s

 52
 

activities during the immediately preceding calendar year (or, in the
case of the first certificate, since the Closing Date) and of its performance
under this Agreement has been made under the supervision of the officer signing
such certificate and (ii) to the best of such officer’s knowledge, based on
such review, the Servicer has fulfilled in all material respects all of its
obligations under this Agreement throughout such calendar year (or applicable
portion of such calendar year), or, if there has been a failure to fulfill any
such obligation in any material respect, specifying each such failure known to
such officer and the nature and status of such failure.

(b)           If the Trust is not required
to file periodic reports under the Exchange Act, or otherwise required by law
to file the reports described in clause (a) above, such reports may be
delivered on or before April 30 of each calendar year.  A copy of such reports may be obtained by any
Noteholder by a request in writing to the Indenture Trustee.

Section 9.05.        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 at least
the following information:

(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;

(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;

 53
 

(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 Purchase Price for such Contracts;

(xvi)        the
aggregate Principal Balance and number of Contracts that were purchased by the
Servicer pursuant to the Agreement with respect to the related Due Period,
identifying the Purchase Price for such Contracts;

(xvii)       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;

(xviii)      the
amount otherwise distributable on the Class C Notes that has instead been
distributed to one or more senior Classes of Notes on such Distribution Date;

(xix)         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

(xx)          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.

(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.

 54
 

(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.

Section 9.06.        Regulation AB.

The parties hereto
acknowledge that interpretations of the requirements of Regulation AB may
change over time, whether due to interpretive guidance provided by the Securities
and Exchange Commission or its staff, consensus among participants in the asset
backed securities markets, advice of counsel, or otherwise, and agree to comply
with reasonable requests (which are practical from a timing perspective) made
by the Trust Depositor or the Servicer in good faith for delivery of
information under these provisions on the basis of evolving interpretations of
Regulation AB.  In connection therewith,
the Owner Trustee and the Indenture Trustee shall reasonably cooperate with the
Servicer in connection with the satisfaction of the Trust Depositor’s and the
Trust’s reporting requirements under the Exchange Act, subject to reimbursement
of expenses in accordance with the Transaction Documents.

Section 9.07.        Information to Be Provided by the Indenture Trustee.

(a)           As soon as available but no
later than March 15 of each calendar year for so long as the Issuer is
required to report under the Exchange Act, commencing in 2008, the Indenture
Trustee shall:

(i)            deliver
to the Servicer a report regarding the Indenture Trustee’s assessment of
compliance with the Servicing Criteria during the immediately preceding
calendar year, as required under paragraph (b) of Rule 13a-18, Rule 15d-18
of the Exchange Act and Item 1122 of Regulation AB. Such report shall be
signed by an authorized officer of the Indenture Trustee, and shall address
each of the Servicing Criteria specified in Exhibit
E or such criteria as mutually agreed upon by the Servicer and the
Indenture Trustee;

(ii)           deliver
to the Servicer a report of a registered public accounting firm that attests
to, and reports on, the assessment of compliance made by the Indenture Trustee
and delivered pursuant to the preceding paragraph. Such attestation shall be in
accordance with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the
Securities Act and the Exchange Act; and

(iii)          deliver
to the Servicer and any other Person that will be responsible for signing the
certification required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act
(pursuant to Section 302 of the Sarbanes-Oxley Act of 2002) (a “Sarbanes Certification”) on behalf of the
Issuer or the Servicer a certification substantially in the form attached
hereto as Exhibit F in such form as mutually
agreed upon by the Servicer and the Indenture Trustee.

The Indenture Trustee acknowledges that the parties
identified in clause (iii) above may rely on the certification provided by
the Indenture Trustee pursuant to such clause in signing a Sarbanes
Certification and filing such with the Securities and Exchange Commission.

Section 9.08.        Exchange Act Reporting.

(a)           Form 10-D Filings.  So long as the Issuer is
required to report under the Exchange Act, no later than each Distribution
Date, each of the Indenture Trustee and the Owner Trustee shall notify the
Servicer of any Form 10-D Disclosure Item with respect to such Person 

 55
 

(to the extent there is any Form 10-D Disclosure Item), together with a
description of any such Form 10-D Disclosure Item in form and substance
reasonably acceptable to the Servicer.

(b)           Form
8-K Filings.  So long as the Issuer is required to report
under the Exchange Act, each of the Indenture Trustee and the Owner Trustee
shall promptly notify the Servicer, but in no event later than one (1) Business
Day after its occurrence, of any Reportable Event of which such Person (or in
the case of the Owner Trustee and the Indenture Trustee, a Responsible Officer
of such Person) has actual knowledge. 
Each Person shall have actual knowledge of any such event only to the extent
that it relates to such Person or any action or failure to act by such Person.

(c)           Form 10-K Filings.  So long as the Issuer is
required to report under the Exchange Act, no later than March 15 of each year,
commencing in 2008, the Indenture Trustee and the Owner Trustee shall notify
the Servicer of any Form 10-K Disclosure Item known to any Responsible Officer
thereof or relating to the Indenture Trustee or Owner Trustee, as applicable,
together with a description of any such Form 10-K Disclosure Item in form and
substance reasonably acceptable to the Servicer.

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 

 56
 

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 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 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 

 57
 

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 § 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 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 

 58
 

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
or electronic mail transmission with a confirmation of receipt, in all cases
addressed to the recipient as follows:

	
   

  	
  (i)

  	
  If to the Servicer or Seller:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Harley-Davidson
  Credit Corp.

  
	
   

  	
   

  	
  222 West Adams
  Street, Suite 2000

  
	
   

  	
   

  	
  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

  

 

 59
 

 

	
  

  	
   

  	
  Telecopier No.:
  (775) 886-3490

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with a copy to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Harley-Davidson
  Credit Corp.

  
	
   

  	
   

  	
  222 West Adams
  Street, Suite 2000

  
	
   

  	
   

  	
  Chicago,
  Illinois 60606

  
	
   

  	
   

  	
  Attention:  Perry A. Glassgow

  
	
   

  	
   

  	
  Telecopier
  No.:   (312) 368-4372

  
	
   

  	
   

  	
   

  
	
   

  	
  (iii)

  	
  If to the Indenture Trustee:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Bank of New
  York Trust Company, N.A.

  
	
   

  	
   

  	
  2 North LaSalle
  Street

  
	
   

  	
   

  	
  Suite 1020

  
	
   

  	
   

  	
  Chicago,
  Illinois 60602

  
	
   

  	
   

  	
  Attention:  Corporate Trust Administration

  
	
   

  	
   

  	
  Telecopier
  No.:  (312) 827-8562

  
	
   

  	
   

  	
   

  
	
   

  	
  (iv)

  	
  If to the Owner Trustee:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Wilmington Trust
  Company

  
	
   

  	
   

  	
  Rodney Square
  North

  
	
   

  	
   

  	
  1100 North
  Market Street

  
	
   

  	
   

  	
  Wilmington,
  Delaware 19890-0001

  
	
   

  	
   

  	
  Attention:
  Corporate Trust Administration

  
	
   

  	
   

  	
  Telecopier No.:
  (302) 636-4140

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (v)

  	
  If to Moody’s:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Moody’s
  Investors Service, Inc.

  
	
   

  	
   

  	
  99 Church Street

  
	
   

  	
   

  	
  New York, New York
  10007

  
	
   

  	
   

  	
  Attention: ABS
  Monitoring Department

  
	
   

  	
   

  	
  Telecopier No.:
  (212) 298-7139

  
	
   

  	
   

  	
  Email:
  servicerreports@moodys.com

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  (vi)

  	
  If to Standard & Poor’s:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Standard &
  Poor’s Ratings Services, a

  
	
   

  	
   

  	
  division of The
  McGraw Hill Companies, Inc.

  
	
   

  	
   

  	
  55 Water Street

  
	
   

  	
   

  	
  New York, New
  York 10004

  
	
   

  	
   

  	
  Telecopier No.:
  (212) 438-2657

  
	
   

  	
   

  	
   

  
	
   

  	
  (vii)

  	
  If to the Underwriters:

  

 

 60
 

 

	
  

  	
   

  	
  At the address
  set forth in the Underwriting 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
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 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 

 61
 

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 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
Wilmington Trust Company, not in its individual capacity but solely in its
capacity as Owner Trustee of the Issuer, and in no event shall Wilmington Trust
Company 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 The Bank
of New York Trust Company, N.A., not in its individual capacity but solely as
Indenture Trustee, and in no event shall The Bank of New York Trust Company,
N.A. 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]

 62

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 2007-2

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Wilmington Trust Company, not in its individual
  capacity but solely as Owner Trustee on behalf of the Trust

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Michele C. Hara

  	
   

  
	
   

  	
   

  	
  Printed Name:

  	
  Michele C. Hara

  	
   

  
	
   

  	
   

  	
  Title:

  	
   Financial Services Officer

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HARLEY-DAVIDSON CUSTOMER FUNDING CORP., as Trust
  Depositor

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Lawrence G. Hund

  	
   

  
	
   

  	
   

  	
  Printed Name: Lawrence G. Hund

  
	
   

  	
   

  	
  Title: President,
  Chief Operating Officer and  Chief
  Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HARLEY-DAVIDSON CREDIT CORP., as Servicer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Lawrence G. Hund

  	
   

  
	
   

  	
   

  	
  Printed Name: Lawrence G. Hund

  
	
   

  	
   

  	
  Title:
  President, Chief Operating Officer and 
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  THE BANK OF NEW YORK TRUST COMPANY, N.A.,

  
	
   

  	
  not in its individual capacity but solely as
  Indenture Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   /s/ Cynthia L. Davis

  	
   

  
	
   

  	
   

  	
  Printed Name: Cynthia L. Davis

  
	
   

  	
   

  	
  Title: Vice President

  
									

 

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 May 15, 2007 made by and between the
undersigned, as Trust Depositor (“Trust Depositor”),
Harley-Davidson Credit Corp., as Servicer (“HDCC”),
The Bank of New York Trust Company, N.A., as Indenture Trustee and
Harley-Davidson Motorcycle Trust 2007-2 (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 Three of the Sale and Servicing
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.

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

	
   

  	
  HARLEY-DAVIDSON CUSTOMER FUNDING

  
	
   

  	
  CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Printed Name: 
  Perry A. Glassgow

  
	
   

  	
  Title:  Vice
  President and Treasurer

  

 

 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 Vice President, Treasurer and Assistant Secretary 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 May 15, 2007 (the “Effective Date”)
by and among the Trust Depositor, The Bank of New York Trust Company, N.A. (the
“Indenture Trustee”), as Indenture
Trustee,  Harley-Davidson Credit Corp. (“Harley-Davidson Credit”), as Servicer, and Harley-Davidson
Motorcycle Trust 2007-2 (“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 May 12, 2000, 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 as of a recent date 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, the Trust Agreement;
the Administration Agreement and the Underwriting Agreement (collectively, the “Program Agreements”). 
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 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 

 B-1
 

dates as of which information is given in the Preliminary Prospectus
(as defined in the Underwriting Agreement) or 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 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-2

In Witness Whereof, I have affixed my signature hereto this        
day of                       .

	
  

  	
  By:

  	
   

  	
   

  
	
   

  	
  Printed Name:  Perry A. Glassgow

  
	
   

  	
  Title:  Vice President, Treasurer and Assistant 

  
	
   

  	
             Secretary

  

 

Exhibit C

[Form of Closing Certificate of
Servicer/Seller]

HARLEY-DAVIDSON CREDIT CORP.

Officer’s Certificate

The undersigned certifies
that he is Vice President, Treasurer and Assistant Secretary 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 May 15, 2007 (the “Effective
Date”) by and among Harley-Davidson Credit, as Servicer,
Harley-Davidson Customer Funding Corp. (“CFC”), The Bank
of New York Trust Company, N.A., as Indenture Trustee and Harley-Davidson
Motorcycle Trust 2007-2 (“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 August 9, 1999, 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 as of a recent date, 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 August 1999 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 and 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 

 C-1
 

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 Preliminary Prospectus (as defined in the Underwriting
Agreement) or 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 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 

 C-2
 

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 authorized the filing of 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:  Perry A. Glassgow

  
	
   

  	
  Title: Vice President,
  Treasurer and Assistant

  
	
   

  	
                     Secretary

  

 

Exhibit D

[RESERVED]

 D-1

Exhibit E

SERVICING CRITERIA TO BE ADDRESSED IN

INDENTURE TRUSTEE’S ASSESSMENT OF COMPLIANCE

The assessment of compliance to be delivered by the Indenture Trustee
shall address, at a minimum, the criteria identified as below as “Applicable
Servicing Criteria”(1):

Servicing Criteria

	
  Reference

  	
   

  	
  Criteria

  	
   

  	
  Applicable

  Servicing

  Criteria

  
	
   

  	
   

  	
  General Servicing Considerations

  	
   

  	
   

  
	
  1122(d)(1)(i)

  	
   

  	
  Policies and
  procedures are instituted to monitor any performance or other triggers and
  events of default in accordance with the transaction agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(1)(ii)

  	
   

  	
  If any material
  servicing activities are outsourced to third parties, policies and procedures
  are instituted to monitor the third party’s performance and compliance with
  such servicing activities.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(1)(iii)

  	
   

  	
  Any requirements
  in the transaction agreements to maintain a back-up servicer for the pool
  assets are maintained.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(1)(iv)

  	
   

  	
  A fidelity bond
  and errors and omissions policy is in effect on the party participating in
  the servicing function throughout the reporting period in the amount of
  coverage required by and otherwise in accordance with the terms of the
  transaction agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Cash Collection and Administration

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(2)(i)

  	
   

  	
  Payments on pool
  assets are deposited into the appropriate custodial bank accounts and related
  bank clearing accounts no more than two business days following receipt, or
  such other number of days specified in the transaction agreements.

  	
   

  	
  x(2)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(2)(ii)

  	
   

  	
  Disbursements
  made via wire transfer on behalf of an obligor or to an investor are made
  only by authorized personnel.

  	
   

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(2)(iii)

  	
   

  	
  Advances of
  funds or guarantees regarding collections, cash flows or distributions, and
  any interest or other fees charged for such advances, are made, reviewed and
  approved as specified in the transaction agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(2)(iv)

  	
   

  	
  The related
  accounts for the transaction, such as cash reserve accounts or accounts
  established as a form of overcollateralization, are separately maintained
  (e.g., with respect to commingling of cash) as set forth in the transaction
  agreements.

  	
   

  	
  x

  

 

 E-1
 

 

	
  (1)

  	
  Each Assessment
  of compliance delivered by the Indenture Trustee shall be made only toward
  such portion(s) of servicing criteria applicable to the Indenture Trustee and
  not such other portion(s) applicable to other persons.

  
	
  (2)

  	
  Solely with
  regard to deposits made by the Indenture Trustee.

  

 

 E-2
 

 

	
   

  	
   

  	
  Servicing Criteria

  	
   

  	
  Applicable
 Servicing

  Criteria

  
	
  1122(d)(2)(v)

  	
   

  	
  Each custodial
  account is maintained at a federally insured depository institution as set
  forth in the transaction agreements. For purposes of this criterion,
  “federally insured depository institution” with respect to a foreign
  financial institution means a foreign financial institution that meets the
  requirements of Rule 13k-1(b)(1) of the Securities Exchange Act.

  	
   

  	
  x(3)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(2)(vi)

  	
   

  	
  Unissued checks
  are safeguarded so as to prevent unauthorized access.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(2)(vii)

  	
   

  	
  Reconciliations
  are prepared on a monthly basis for all asset-backed securities related bank
  accounts, including custodial accounts and related bank clearing accounts.
  These reconciliations are (A) mathematically accurate; (B) prepared within 30
  calendar days after the bank statement cutoff date, or such other number of
  days specified in the transaction agreements; (C) reviewed and approved by
  someone other than the person who prepared the reconciliation; and (D)
  contain explanations for reconciling items. These reconciling items are
  resolved within 90 calendar days of their original identification, or such
  other number of days specified in the transaction agreements.

  	
   

  	
   

  

 

	
  Reference

  	
   

  	
  Criteria

  	
   

  	
   

  
	
   

  	
   

  	
  Investor Remittances and Reporting

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(3)(i)

  	
   

  	
  Reports to
  investors, including those to be filed with the Commission, are maintained in
  accordance with the transaction agreements and applicable Commission
  requirements. Specifically, such reports (A) are prepared in accordance with
  timeframes and other terms set forth in the transaction agreements; (B)
  provide information calculated in accordance with the terms specified in the
  transaction agreements; (C) are filed with the Commission as required by its
  rules and regulations; and (D) agree with investors’ or the trustee’s records
  as to the total unpaid principal balance and number of pool assets serviced
  by the Servicer.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(3)(ii)

  	
   

  	
  Amounts due to
  investors are allocated and remitted in accordance with timeframes,
  distribution priority and other terms set forth in the transaction
  agreements.

  	
   

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(3)(iii)

  	
   

  	
  Disbursements
  made to an investor are posted within two business days to the Servicer’s
  investor records, or such other number of days specified in the transaction
  agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(3)(iv)

  	
   

  	
  Amounts remitted
  to investors per the investor reports agree with cancelled checks, or other
  form of payment, or custodial bank statements.

  	
   

  	
  x

  

 

 E-3
 

 

	
  (3)

  	
   

  	
  Assessment to be
  given by Indenture Trustee shall be only with respect to trust accounts
  maintained by the Indenture Trustee under the Sale and Servicing Agreement

  

 

 E-4
 

 

 

	
   

  	
   

  	
  Pool Asset Administration

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(i)

  	
   

  	
  Collateral or
  security on pool assets is maintained as required by the transaction
  agreements or related asset pool documents.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(ii)

  	
   

  	
  Pool assets and
  related documents are safeguarded as required by the transaction agreements

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(iii)

  	
   

  	
  Any additions,
  removals or substitutions to the asset pool are made, reviewed and approved
  in accordance with any conditions or requirements in the transaction
  agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(iv)

  	
   

  	
  Payments on pool
  assets, including any payoffs, made in accordance with the related pool asset
  documents are posted to the Servicer’s obligor records maintained no more
  than two business days after receipt, or such other number of days specified
  in the transaction agreements, and allocated to principal, interest or other
  items (e.g., escrow) in accordance with the related asset pool documents.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(v)

  	
   

  	
  The Servicer’s
  records regarding the accounts and the accounts agree with the Servicer’s
  records with respect to an obligor’s unpaid principal balance.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(vi)

  	
   

  	
  Changes with
  respect to the terms or status of an obligor’s account (e.g., loan
  modifications or re-agings) are made, reviewed and approved by authorized
  personnel in accordance with the transaction agreements and related pool
  asset documents.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(vii)

  	
   

  	
  Loss mitigation
  or recovery actions (e.g., forbearance plans, modifications and deeds in lieu
  of foreclosure, foreclosures and repossessions, as applicable) are initiated,
  conducted and concluded in accordance with the timeframes or other
  requirements established by the transaction agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(viii)

  	
   

  	
  Records
  documenting collection efforts are maintained during the period a pool asset
  is delinquent in accordance with the transaction agreements. Such records are
  maintained on at least a monthly basis, or such other period specified in the
  transaction agreements, and describe the entity’s activities in monitoring
  delinquent pool assets including, for example, phone calls, letters and
  payment rescheduling plans in cases where delinquency is deemed temporary
  (e.g., illness or unemployment).

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(ix)

  	
   

  	
  Adjustments to
  interest rates or rates of return for pool assets with variable rates are
  computed based on the related pool asset documents.

  	
   

  	
   

  

 

 E-5
 

 

	
  Reference

  	
   

  	
  Criteria

  	
   

  	
   

  
	
  1122(d)(4)(x)

  	
   

  	
  Regarding any
  funds held in trust for an obligor (such as escrow accounts): (A) such funds
  are analyzed, in accordance with the obligor’s Account documents, on at least
  an annual basis, or such other period specified in the transaction
  agreements; (B) interest on such funds is paid, or credited, to obligors in
  accordance with applicable Account documents and state laws; and (C) such
  funds are returned to the obligor within 30 calendar days of full repayment
  of the related Accounts, or such other number of days specified in the
  transaction agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(xi)

  	
   

  	
  Payments made on
  behalf of an obligor (such as tax or insurance payments) are made on or
  before the related penalty or expiration dates, as indicated on the
  appropriate bills or notices for such payments, provided that such support
  has been received by the servicer at least 30 calendar days prior to these
  dates, or such other number of days specified in the transaction agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(xii)

  	
   

  	
  Any late payment
  penalties in connection with any payment to be made on behalf of an obligor
  are paid from the servicer’s funds and not charged to the obligor, unless the
  late payment was due to the obligor’s error or omission.

  	
   

  	
   

  

 

	
   

  	
   

  	
  Servicing
  Criteria

  	
   

  	
  Applicable

  Servicing

  Criteria

  
	
  1122(d)(4)(xiii)

  	
   

  	
  Disbursements
  made on behalf of an obligor are posted within two business days to the
  obligor’s records maintained by the servicer, or such other number of days
  specified in the transaction agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(xiv)

  	
   

  	
  Delinquencies,
  charge-offs and uncollectible accounts are recognized and recorded in
  accordance with the transaction agreements.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1122(d)(4)(xv)

  	
   

  	
  Any external
  enhancement or other support, identified in Item 1114(a)(1) through (3) or
  Item 1115 of Regulation AB, is maintained as set forth in the transaction
  agreements.

  	
   

  	
   

  

 

 E-6

Exhibit
F

FORM
OF ANNUAL CERTIFICATION OF THE INDENTURE TRUSTEE

	
  

  	
  Dated:

  	
   

  	
   

  

 

The Bank of New York Trust
Company, N.A., not in its individual capacity but solely as indenture trustee
(the “Indenture Trustee”), certifies to Harley-Davidson Credit Corp. (the “Servicer”),
its officers and Harley-Davidson Motorcycle Trust 2007-2 (the “Issuer”), with
the knowledge and intent that they will rely upon this certification, that:

(1)   It has reviewed the report
on assessment of the Indenture Trustee’s compliance provided in accordance with
Rules 13a-18 and 15d-18 under the Securities Exchange Act of 1934, as amended
(the “Securities Exchange Act”) and Item 1122 of Regulation AB under the
Securities Act of 1933, as amended, and the Securities Exchange Act (the “Servicing
Assessment”), that were delivered by the Indenture Trustee to the Seller
pursuant to the Sale and Servicing Agreement dated as of May 15, 2007, among
Harley-Davidson Customer Funding Corp., the Servicer, the Indenture Trustee and
the Issuer (collectively, the “Indenture Trustee Information”);

(2)   To the best of its knowledge, the Indenture
Trustee Information, taken as a whole, does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements made, in the light of the circumstances under which such statements
were made, not misleading with respect to the period of time covered by the
Indenture Trustee Information (in making such statement, the Indenture Trustee
makes no representation or warranty as to any information prepared or provided
to it by a third person and upon which it relied in preparing our information);
and

(3)   To the best of its knowledge, all of the
Indenture Trustee Information required to be provided by the Indenture Trustee
under the Indenture has been provided to the Servicer.

	
   

  	
  THE BANK OF NEW YORK TRUST

  
	
   

  	
  COMPANY, N.A., as Indenture Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

 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 May 15,
2007 by and among Harley-Davidson Customer Funding Corp., as Trust Depositor,
the Servicer, The Bank of New York Trust Company, N.A., as Indenture Trustee,
and Harley-Davidson Motorcycle Trust 2007-2 (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/Servicer] on the date hereof pursuant to [Section 7.08 of the Agreement
and Section 5.01 of the Transfer and Sale Agreement/Section 7.10 of the Agreement/Section
7.11 of the Agreement.]

2.                                       Upon
deposit of the Purchase Price for such Contracts, such Contracts may, pursuant
to Section 7.09 of the Agreement, be assigned by the Trustee to the
Seller[/Servicer].

IN WITNESS WHEREOF, I have affixed hereunto my
signature this                 
day of                 .

	
   

  	
  Harley-Davidson Credit Corp.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
         Printed
  Name: Perry A. Glassgow

  
	
   

  	
   

  	
         Title:
  Vice President and Treasurer

  

 

 G-1

Exhibit
H

[List of Contracts]

 H-1

Exhibit
I

[Form of Monthly Report to Noteholders and the Certificateholder]

Harley-Davidson
Motorcycle Trust 2007-2

$                   %
Motorcycle Contract Backed Notes, Class A-1

$                   %
Motorcycle Contract Backed Notes, Class A-2

$                   %
Motorcycle Contract Backed Notes, Class A-3

$                   %
Motorcycle Contract Backed Notes, Class A-4

$                   %
Motorcycle Contract Backed Notes, Class B

$                   %
Motorcycle Contract Backed Notes, Class C

Monthly
Report

For the                   
Distribution Date

Capitalized terms are
defined in the Sale and Servicing Agreement dated as of May 15, 2007.

	
  Beginning of Due Period

  
	
  End of Due Period

  
	
  Determination Date

  
	
  Record Date

  

 

 I-1
 

 

	
  Distribution Date

  
	
  Number of days in Interest Period (On 30/360 basis)

  
	
   

  
	
  Number of days in Interest Period (On Actual/360
  basis)

  

 

	
   

  	
   

  	
  Number

  	
   

  	
  Cut-Off

  	
   

  	
   

  	
   

  	
  Initial

  	
   

  
	
  Purchases

  	
   

  	
  of Contracts

  	
   

  	
  Date

  	
   

  	
  Closing Date

  	
   

  	
  Pool Balance

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Initial
  Contracts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Subsequent
  Contracts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 I-2
 

 

I. POOL BALANCE CALCULATION

	
  Principal Balance of Contracts at beginning of
  Due Period

  
	
  Pre-Funded Amount at beginning of Due Period

  
	
   

  
	
  Purchase of Subsequent Contracts

  
	
  Reduction of Pre-Funded Amount at end of Due Period

  
	
  Mandatory Redemption amount

  
	
   

  
	
  Monthly principal amounts

  
	
   

  
	
  Principal
  collections on Contracts outstanding at end of Due Period

  
	
  Principal
  collections on Contracts paid off in full during Due Period

  
	
  Balance of
  Contracts liquidated during Due Period

  
	
  Balance of
  Contracts purchased by Seller or Servicer during Due Period

  
	
  Other
  adjustments

  
	
  Mandatory
  Redemption amount

  
	
   

  
	
  Aggregate Principal Balance Decline

  
	
   

  
	
  Aggregate Principal Balance at end of Due Period

  
	
   

  
	
  Pool factor

  

 

 I-3
 

 

II. NOTE PRINCIPAL BALANCE
CALCULATION:

	
   

  	
   

  	
  Class A-1

  	
   

  	
  Class A-2

  	
   

  	
  Class A-3

  	
   

  	
  Class A-4

  	
   

  	
  Class B

  	
   

  	
  Class C

  	
   

  	
  Total

  	
   

  
	
  Original Note Balance

  	
   

  	
  $

  	
   

  	
  $ 

  	
   

  	
  $ 

  	
   

  	
  $ 

  	
   

  	
  $ 

  	
   

  	
  $ 

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Note balance at
  beginning of Due Period

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Distributable Amount

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Amounts
  otherwise distributable to Class B that have been distributed to Class A

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Amounts otherwise
  distributable to Class C that have been distributed to Class A and/or Class B

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Mandatory
  Redemption Amount

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Note Principal
  Carryover Shortfall

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total principal
  paid

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Note balance at
  end of Due Period

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Note factor at
  beginning of Due Period

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Note factor at
  end of Due Period

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 I-4
 

III. NOTE INTEREST DISTRIBUTABLE CALCULATION

	
   

  	
   

  	
   

  	
   

  	
  Interest
  Carryover

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Note Monthly

  	
   

  	
  Interest
  Carryover

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Note Balance

  	
   

  	
  Shortfall

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Interest

  	
   

  	
  Interest

  	
   

  	
  Shortfall

  	
   

  	
  Note Interest

  	
   

  
	
   

  	
   

  	
  at Beginning
  of

  	
   

  	
  at Beginning
  of

  	
   

  	
  Interest

  	
   

  	
   

  	
   

  	
  Accrual

  	
   

  	
  Distributable

  	
   

  	
  at End of

  	
   

  	
  Distributable

  	
   

  
	
  Class

  	
   

  	
  Due Period

  	
   

  	
  Due Period

  	
   

  	
  Rate

  	
   

  	
  Days

  	
   

  	
  Basis

  	
   

  	
  Amount

  	
   

  	
  Due Period

  	
   

  	
  Amount

  	
   

  
	
  A-1

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A-2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A-3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A-4

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Totals

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 I-5
 

 

IV. CALCULATION OF AVAILABLE MONIES AND DISTRIBUTIONS

Available Monies:

Principal collections on Contracts during Due Period

Interest collections on Contracts during Due Period

Net Liquidation Proceeds

Aggregate of Purchase Price for Contracts required to be purchased by Seller or
Servicer

Advances made by Servicer

Amounts paid by Seller in connection with the optional repurchase of the
Contracts

Carrying Charges from the Interest Reserve Account

Mandatory  Redemption amount

Investment Earnings - Collection Account

Investment Earnings - Interest Reserve Account

Total Available Monies

Distribution of Available Monies in order of priority:

Mandatory Redemption amount to the Noteholders

Return of previous month’s Advances made by Servicer

Monthly Servicing Fee to the Servicer, including any unpaid Servicing Fees

Monthly Indenture Trustee Fee, including any unpaid Indenture Trustee fees

Class A Note Interest Distributable Amount

First Priority Principal Distributable Amount

 I-6
 

Class B Note Interest Distributable Amount

Second Priority Principal Distributable Amount

Class C Note Interest Distributable Amount

Class A Note Principal Distributable Amount

Class B Note Principal Distributable Amount

Class C Note Principal Distributable Amount

Total distribution of fees, interest and principal

Excess Amounts (Shortfall)

Amount withdrawn from Reserve Fund to cover Shortfall

Excess Amounts to Reserve Fund

Excess Amounts to Certificateholder

Total distribution of Available Monies

 I-7
 

 

V. ACCOUNT BALANCE INFORMATION

Calculation of Specified Reserve Fund Balance:

The greater of:

a) 1.50% of the Principal Balance of the Contracts at the end of the
Due Period

b) 1.00% of the aggregate initial note balance

c) If Reserve Fund Trigger Event has occurred, 6.00% of the Principal
Balance of the Contracts at the end of the Due Period

Specified Reserve Fund Balance

Reserve Fund balance at beginning of Due Period

Additions to Reserve Fund:

Additional deposit - Subsequent Reserve Fund Amount deposit

Additional deposit - Excess Amounts to Reserve Fund

Investment Earnings - Reserve Fund

Total additions

Withdrawals from Reserve Fund:

Amount withdrawn to cover Shortfall

 I-8
 

Excess Reserve Fund balance to Servicer

Total withdrawals

Reserve Fund balance at end of Due Period

Pre-Funding Account balance at beginning of Due Period

Withdrawals from Pre-Funding Account:

Subsequent Contracts purchased

Mandatory Redemption amount

Pre-Funding Account balance at end of Due Period

Interest Reserve Account balance at beginning of Due Period

Additions to the Interest Reserve Account:

Investment Earnings - Interest Reserve Account

Withdrawals from the Interest Reserve Account:

Carrying Charges

Transfer of Investment Earnings to Collection Account

Excess Interest Reserve Amount to Depositor

Interest Reserve Account balance at end of Due Period

 I-9
 

VI. CONTRACT PERFORMANCE INFORMATION

Number of months since Closing Date

Trigger Status?  Yes or No

Monthly Losses

	
   

  	
   

  	
  Number of

  	
   

  	
   

  	
   

  	
  % of Principal Balance at

  	
   

  
	
  Monthly
  Losses

  	
   

  	
  Contracts

  	
   

  	
  Amount

  	
   

  	
  beginning of Due Period

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Balance of Liquidated Contracts for the Due Period

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Net Liquidation
  Proceeds for the Due Period

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Net Liquidation
  Losses for the Due Period

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Annualized Net
  Liquidation Losses

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

Average Loss Ratio

Annualized
Net Liquidation Losses - current Distribution Date

Annualized Net Liquidation Losses - prior Distribution Date

Annualized Net Liquidation Losses - second prior Distribution Date

Three-month Average Loss Ratio

Exceeds Reserve Fund Trigger Event threshold?  Yes or No

 I-10
 

 

	
  Months

  	
   

  	
  Trigger Threshold

  	
   

  
	
  1-24

  	
   

  	
  4.00

  	
  %

  
	
  25 or greater

  	
   

  	
  3.75

  	
  %

  

 

Cumulative Losses

	
   

  	
   

  	
  Number of

  Contracts

  	
   

  	
  Amount

  	
   

  	
  %of Initial

  Principal Balance

  	
   

  
	
  Cumulative
  Liquidated Contracts

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cumulative Net
  Liquidation Proceeds

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cumulative Net
  Liquidation Losses

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

Average net loss (amount of cumulative Net Liquidation Losses / number
of cumulative Liquidated Contracts)

Cumulative Loss Ratio

Cumulative Loss Ratio

Exceeds Reserve Fund Trigger Event threshold?  Yes or No

	
  Months

  	
   

  	
  Trigger Threshold

  	
   

  
	
  1-12

  	
   

  	
  1.75

  	
  %

  
	
  13-24

  	
   

  	
  2.75

  	
  %

  
	
  25-36

  	
   

  	
  3.75

  	
  %

  
	
  37 or greater

  	
   

  	
  4.00

  	
  %

  

 

 I-11
 

Delinquencies

	
  Days

  	
   

  	
  Number of

  	
   

  	
  Principal

  	
   

  	
  Delinquent

  	
   

  	
  % of Principal Balance at

  	
   

  
	
  Delinquent

  	
   

  	
  Contracts

  	
   

  	
  Balance

  	
   

  	
  Interest
  Amount

  	
   

  	
  Beginning of
  Due Period

  	
   

  
	
  30-59

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  60-89

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  90-119

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  120+

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Totals

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  60+ Delinquency
  Amount

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

Average Delinquency Ratio

Delinquency Ratio - current Distribution Date

Delinquency Ratio - prior Distribution Date

Delinquency Ratio - second prior Distribution Date

Three-month Average Delinquency Ratio

Exceeds Reserve Fund Trigger Event threshold?  Yes or No

	
  Months

  	
   

  	
  Trigger Threshold

  	
   

  
	
  1-12

  	
   

  	
  2.50

  	
  %

  
	
  13-24

  	
   

  	
  3.00

  	
  %

  
	
  25-36

  	
   

  	
  3.50

  	
  %

  
	
  37 or greater

  	
   

  	
  4.00

  	
  %

  

 

 I-12
 

VII.
ADDITIONAL CONTRACT INFORMATION

	
  Contract Data

  	
   

  	
  Beginning of Due Period

  	
   

  	
  End of Due Period

  	
   

  
	
  Number of
  Contracts

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal
  Balance of Contracts

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Weighted average
  original term

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Weighted average
  remaining term

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Weighted average
  life

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  One month
  prepayments (ABS)

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Weighted average
  Contract Rate

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
  Contract Data

  	
   

  	
  Principal Balance 

  of Contracts

  	
   

  	
  % of Principal Balance

  End of Due Period

  	
   

  
	
  0.000% - 5.000%

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.001% - 10.000%

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.001% -
  15.000%

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  15.001% -
  20.000%

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  20.001% or
  greater

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

Advances
made by Servicer in current Due Period

Unreimbursed
Advances due to Servicer

Number
of Contracts purchased by Seller or Servicer

Principal
Balance of Contracts purchased by Seller or Servicer

Purchase Price of Contracts purchased by Seller or Servicer

 I-13
 

VIII. OTHER INFORMATION
FOR NOTEHOLDERS

	
  1.

  	
  Information regarding material changes to the
  definition or determination of delinquencies, charge-offs and uncollectible
  accounts:

  
	
   

  	
   

  
	
  2.

  	
  Information regarding any material modifications,
  extensions or waivers to contract terms, fees, penalties or payments during
  the distribution period or that have cumulatively become material over time:

  
	
   

  	
   

  
	
  3.

  	
  Information regarding material breaches of contract
  representations or warranties or transaction covenants:

  
	
   

  	
   

  
	
  4.

  	
  Information regarding any new issuance of
  asset-backed securities backed by the same contracts:

  
	
   

  	
   

  
	
  5.

  	
  Information regarding any contract changes (other
  than in connection with a contract converting into cash in accordance with
  its terms), such as additions or removals in connection with a prefunding
  period, including any material changes in the solicitation, credit-granting,
  underwriting, origination, acquisition or pool selection criteria or
  procedures, as applicable, used to originate, acquire or select the new pool
  of contracts:

  
	
   

  	
   

  
	
  6.

  	
  During the pre-funding period, if applicable,
  information regarding originators, pool contracts or significant obligors
  pursuant to Item 1121(b) of Regulation AB: ]

  
	
   

  	
   

  
	
  7.

  	
  Information regarding derivatives:

  

 

 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.

(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

 J-1
 

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 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.

(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, 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.

 J-2
 

(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
Eaglemark Savings Bank or such motorcycle dealer, as the case may be, to the
Seller without any fraud or misrepresentation on the part of Eaglemark Savings
Bank or, to the knowledge of the Seller, such motorcycle dealer.

(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,
in any material respect 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.

(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 Initial Cutoff Date
(or the applicable Subsequent Cutoff Date in the case

 J-3
 

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 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

 J-4
 

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.

(w)          Selection Criteria.  Each Contract is secured by a new or used Motorcycle.  No Contract has a Contract Rate less than
3.899%.  Each Contract amortizes the
amount financed over an original term no greater than 84 months.  Each Contract has a Principal Balance of at
least $510.30 as of the related Cutoff Date.

(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 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 84 months; and (iii) the
final scheduled payment on the Initial Contract with the latest maturity is due
not later than June 2014.  Approximately
79.20% 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 20.80% 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 3.899%.  The
last scheduled payment date of the Contracts (including any Subsequent
Contracts) is due not later than September 2014.  Approximately 99.02% 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 0.98% 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

 J-5
 

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, 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 11.00% 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-6

Exhibit K

[Lockbox Bank and Lockbox Account]

Lockbox

Harley-Davidson
Credit Corp.

8529
Innovation Way

Chicago, Illinois 60682-0085

Lockbox Bank

LaSalle
Bank National Association

135
South LaSalle Street

Chicago, Illinois 60674

 K-1

Exhibit L

FORM OF SUBSEQUENT TRANSFER AGREEMENT

SUBSEQUENT TRANSFER AGREEMENT (the “Agreement”), dated as of                             ,
by and among Harley-Davidson Motorcycle Trust [                 ]
(the “Trust”), Harley-Davidson Customer
Funding Corp., a Nevada corporation (the “Trust Depositor”),
The Bank of New York Trust Company, N.A., as Indenture Trustee (the “Indenture Trustee”) and Harley-Davidson Credit Corp., a
Nevada corporation (the “Servicer”),
pursuant to the Sale and Servicing Agreement referred to below.

WITNESSETH:

WHEREAS, the Trust, the Trust Depositor, the Servicer
and the Indenture Trustee, are parties to the Sale and Servicing Agreement,
dated as of                           
(the “Sale and Servicing Agreement”);

WHEREAS, pursuant to the Sale and Servicing Agreement,
the Trust Depositor wishes to sell the Subsequent Contracts to the Trust, and
the Trust wishes to purchase the same, for the consideration described in the
Sale and Servicing Agreement; and

WHEREAS, the Seller, on behalf of the Trust Depositor,
has delivered an Addition Notice related to such conveyance as required by
Section 2.03(b) of the Sale and Servicing Agreement;

NOW, THEREFORE, the parties hereto 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 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 2.03(b) of the Sale and Servicing Agreement and
this Agreement, the Trust Depositor hereby sells, transfers, assigns, sets over
and otherwise conveys to the Trust (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
Subsequent Cutoff Date, including any liquidation proceeds therefrom, but
excluding any rights to receive payments which were collected pursuant thereto
on or prior to the

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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 motorcycle dealer agreements
between the dealers (i.e., the originators of certain Subsequent Contracts) and
the Seller, (vi) all rights of the Trust Depositor in the Lockbox, the Lockbox
Account and 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) of the Sale
and Servicing Agreement), 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) of the Sale and Servicing Agreement) (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.  It is the
intention of the Trust Depositor and Owner Trustee that the transfer
contemplated by this Agreement shall constitute a sale of the Subsequent
Contracts from the Trust Depositor to the Trust, conveying good title thereto
free and clear of any Liens.

Section 4.              Representations and Warranties of
the Trust Depositor.  (a) The Trust Depositor hereby represents and
warrants to the Trust, the Indenture Trustee and the Noteholders that the
representations and warranties of the Trust Depositor set forth in Section 3.01
of the Sale and Servicing Agreement are true and correct as of the Subsequent
Transfer Date.

(b)           The Trust Depositor hereby repeats and
remakes with respect to the Subsequent Contracts as of the Subsequent Transfer
Date the representations and warranties of the Servicer, as Seller of the
Subsequent Contracts, set forth in Exhibit J to the Sale and Servicing
Agreement, except that no representation or warranty is made herein with
respect to paragraph 3(b) thereof (other than with respect to clause (i) of
paragraph 3(b)).

(c)           The Trust Depositor 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 pursuant
to this Agreement is $                   
as of the Subsequent Cutoff Date, and (b) the conditions set forth in Section
2.03(b) of the Sale and Servicing Agreement have been satisfied as of the
Subsequent Transfer Date.

Section 5.              Representations and Warranties of
the Servicer.  (a) The Servicer hereby represents and
warrants to the Trust that the representations and warranties of the Servicer
set forth in Section 3.02 of the Sale and Servicing Agreement are true and
correct as of the Subsequent Transfer Date.

Section 6.              Ratification of Agreement. 
As supplemented by this Agreement, the Sale and Servicing 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 7.              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.

 L-2
 

Section 8.              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 9.              Authorization of Trustee. 
By its execution hereof, the Trust Depositor hereby authorizes and
directs the Owner Trustee to execute and deliver this Agreement on behalf of
the Trust.

[signature page follows]

 L-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: Perry A. Glassgow

  
	
   

  	
   

  	
  Title: Vice President and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  HARLEY-DAVIDSON CREDIT CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Printed Name: Perry A. Glassgow

  
	
   

  	
   

  	
  Title: Vice President and Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  HARLEY-DAVIDSON

  
	
   

  	
   

  	
  MOTORCYCLE TRUST 2007-2

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:       Wilmington
  Trust Company, not in its individual capacity but solely as Owner Trustee on
  behalf of the Trust

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Printed Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  THE BANK OF NEW YORK TRUST COMPANY, 

  N.A.

  
	
   

  	
   

  	
  not in its individual capacity but solely

  
	
   

  	
   

  	
  as Indenture Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Printed Name:

  
	
   

  	
   

  	
  Title:

  
							

 

 L-1

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