February 2007

 CONTRACT SETTLEMENT AGREEMENT

Between Harley-Davidson Motor Company and the

Tyson Lodge No. 175, District 98 of the

International Association of Machinists and Aerospace Workers

Article 11, Section 5. Add the following sentence after the first sentence of this section: "If the Steward and/or a Shop Committee member is not present prior to the meeting, no disciplinary action can be taken."

An employee will receive an additional four (4) hours of paid absence for personal reasons if the employee had perfect attendance for six (6) months (either January 1 through June 30 or July 1 through December 31), subject to the terms of Article 22. An employee will receive an additional four (4) hours of paid absence for personal reasons if the employee completes a full calendar year with perfect attendance, subject to the terms of Article 22. All employees will be considered to have had perfect attendance from January 1, 2007 through March 5, 2007 for the purposes of receiving additional personal leave time for perfect attendance in calendar year 2007.

Holidays

2007

* Wednesday, December 26, 2007, will be considered a non-paid day in which an employee may choose to use vacation or personal allowance.

2008

* Tuesday, December 30, 2008, will be considered a non-paid day in which an employee may choose to use vacation or personal allowance.

2009

* Wednesday, December 30, 2009, will be considered non-paid days in which an employee may choose to use vacation or personal allowance.

2010

** This date is subject to change provided the First Day of Buck Season is changed by the Pennsylvania Game Commission.

Employees may take Martin Luther King, Jr. Day as an excused day off. Employees may use either vacation, paid sick, paid personal or unpaid time, if they provide the Company with at least ten (10) days advance notice of their intention to do so.

Thirty-five (35) years and over of seniority – 3 1/2 days for each full month of employment to a total of 35 days.

Safety Committee

Delete the current first sentence of the first paragraph and replace as follows: "There shall be Union Safety Co-coordinators (at least three (3) appointed by the Union President in accordance with Exhibit #11B)."

Delete the current language and replace as follows: "In addition to A above, there shall be three (3) full-time Union Safety positions in accordance with Exhibit #11A."

Delete the current first paragraph and replace as follows: "The Safety Manager shall notify a full-time Union Safety Representative immediately following any serious accident."

Delete the current language and replace as follows: "Whenever the Company conducts a meeting with any individual or group of Bargaining Unit employees to discuss provisions or applications of the Collective Bargaining Agreement, a Union representative shall attend."

LABOR GRADES EFFECTIVE DATE OF RATIFICATION OF CONTRACT (4%) 

LABOR GRADES EFFECTIVE JANUARY 28, 2008 (4%) 

LABOR GRADES EFFECTIVE FEBRUARY 2, 2009 (4%)

SUMMARY OF INSURANCE PLAN

*Weekly Indemnity/Accident and Sickness Benefits…$400.00 Effective Feb. 2, 2007

$410.00 Effective Feb. 2, 2008
$420.00 Effective Feb. 2, 2009

Health Care for Current Active Employees and Future Retirees
(Retired on or after February 2, 2002)

(Effective July 1, 2007)

Employee Premiums None

Drug Provisions (co-pays) Retail: Generic = $5

Preferred Brand = $25

Non-Preferred Brand = $50

(or actual costs)

Delete the current language and replace as follows: "The Company agrees to have an insurance representative from the insurance company on site daily at the facility to answer employee questions regarding insurance coverage and discuss any problems that the employee has encountered."

401 k
Delete the first paragraph and replace as follows:

The parties agree that, effective with participant elective deferrals from February 2, 2007 and thereafter, a 401K Company match equal to 50% of the first 6% contributed by the employee will be granted to each full-time regular bargaining unit employee active on the York Payroll that is contributing to the Plan. This increased match will be made (based upon the Company EBIT performance measure) in early 2008 based upon 2007 performance. In order to receive any portion of the Company match, the employee must be employed by Harley-Davidson on the last day of the plan year (December 31). Exceptions to this requirement are employees who retire or die during the year. These persons would still be credited for the match payable for the year, even if not employed on December 31. The Company contributions will be invested in the Harley-Davidson Common Stock Fund. The Company match cannot be transferred or directed to any other investment option in the Plan until the employee has become vested in these contributions (three (3) years of service). The matching contributions are not available for loans or hardship withdrawals under the Plan. To be “vested” in (or have a nonforfeitable right to) the value of the Company match, you need to be an employee of Harley-Davidson for at least three (3) calendar years of employment during which you are credited with at least 1000 hours of service each year (three (3) “years of service”). You are also 100% vested in the value of the company matching contribution account if you retire, die or become eligible for Social Security Disability benefits.

In addition, delete the final paragraph and example and replace as follows:

Under current guidelines, when EBIT for a fiscal year is at least equal to 11%, a Company match will be made. The current match formula is as follows:

If Harley-Davidson Motor

Company EBIT % Is:11%

Match Is: 50%

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