<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] CONFIDENTIAL, FOR USE OF THE COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
HARLEY-DAVIDSON, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
LOGO
NOTICE OF ANNUAL MEETING
AND
PROXY STATEMENT
HARLEY-DAVIDSON, INC.
3700 WEST JUNEAU AVENUE
MILWAUKEE, WISCONSIN 53208
(414) 342-4680
March 28, 1997
Dear Fellow Shareholder:
On behalf of the Board of Directors and management of Harley-Davidson, Inc.,
I cordially invite you to attend the 1997 Annual Meeting of Shareholders of
Harley-Davidson, Inc. to be held at 10:30 a.m., local time, on Saturday, May
3, 1997, at The Inn at Heritage Hills, 2700 Mount Rose Avenue, York,
Pennsylvania.
The attached Notice of Annual Meeting and Proxy Statement describe the
formal business to be transacted at the Meeting. During the Meeting, there
will be brief reports on the operations of the Company. Once the business of
the Meeting has been concluded, shareholders will be given the opportunity to
ask questions.
We sincerely hope you will be able to attend our 1997 Annual Meeting.
However, whether or not you are personally present, it is important that your
shares be represented. ACCORDINGLY, PLEASE MARK, SIGN, DATE AND MAIL YOUR
PROXY CARD IN THE ENCLOSED ENVELOPE PROVIDED FOR THIS PURPOSE.
Sincerely yours,
LOGO
Richard F. Teerlink
Chairman, President and
Chief Executive Officer
<PAGE>
LOGO
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 3, 1997
The 1997 Annual Meeting of Shareholders (the "Annual Meeting") of Harley-
Davidson, Inc. (the "Company") will be held at The Inn at Heritage Hills, 2700
Mount Rose Avenue, York, Pennsylvania, on May 3, 1997 at 10:30 a.m., local
time, for the following purposes:
1. To elect four directors for a three-year term to expire at the
Company's 2000 annual meeting of shareholders;
2. To ratify the selection of Ernst & Young LLP, independent public
accountants, to be the auditors of the annual financial statements of the
Company for the year ending December 31, 1997; and
3. To take action upon any other business as may properly come before the
Annual Meeting and any adjournment thereof.
The Board of Directors of the Company has fixed the close of business on
March 19, 1997 as the record date for the determination of shareholders
entitled to notice of and to vote at the Annual Meeting and any adjournment
thereof.
By Order of the Board of Directors,
LOGO
Timothy K. Hoelter
Assistant Secretary
Milwaukee, Wisconsin
March 28, 1997
YOUR VOTE IS IMPORTANT,
NO MATTER HOW MANY SHARES YOU OWNED
ON THE RECORD DATE.
PLEASE INDICATE YOUR VOTING INSTRUCTIONS ON THE ENCLOSED PROXY CARD AND
SIGN, DATE AND RETURN IT IN THE ENVELOPE PROVIDED WHICH IS ADDRESSED FOR YOUR
CONVENIENCE AND NEEDS NO POSTAGE IF MAILED IN THE UNITED STATES. IN ORDER TO
AVOID THE ADDITIONAL EXPENSE TO THE COMPANY OF FURTHER SOLICITATION, WE ASK
YOUR COOPERATION IN MAILING YOUR PROXY PROMPTLY.
<PAGE>
LOGO
3700 WEST JUNEAU AVENUE
MILWAUKEE, WISCONSIN 53208
MARCH 28, 1997
----------------
PROXY STATEMENT
----------------
The proxy accompanying this Proxy Statement is solicited by the Board of
Directors (the "Board") of Harley-Davidson, Inc. (the "Company") for use at
the 1997 Annual Meeting of Shareholders of the Company to be held on May 3,
1997 and at any adjournment thereof (the "Annual Meeting"). This Proxy
Statement and the accompanying proxy were first sent to shareholders on or
about March 28, 1997.
The only outstanding class of voting securities of the Company is its Common
Stock (the "Common Stock"). On March 19, 1997, the record date for the
determination of shareholders entitled to notice of and to vote at the Annual
Meeting, 75,733,097 shares of Common Stock were outstanding. Holders of the
Common Stock are entitled to one vote per share on all matters.
Shareholders who execute proxies may revoke them at any time prior to the
voting thereof by delivery of a subsequently dated proxy or written notice (1)
to the Secretary of the Company at the Company's address shown above on or
before May 1, 1997 or (2) to the secretary of the Annual Meeting at the Annual
Meeting. Unless so revoked, the shares represented by proxies received by the
Board will be voted at the Annual Meeting. Where a shareholder specifies a
choice by means of the ballot provided in the proxy, the shares will be voted
in accordance with such specification.
As used in this Proxy Statement, "Motor Company" refers to the Company's
principal subsidiary, Harley-Davidson Motor Company.
<PAGE>
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of March 19, 1997 with
respect to the Common Stock ownership of each director, the Chief Executive
Officer, the four other executive officers of the Company identified in the
Summary Compensation Table below (collectively with the Chief Executive
Officer, the "named executive officers"), all directors and executive officers
as a group and each person or group of persons known by the Company to own
beneficially more than 5% of the Common Stock of the Company.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
BENEFICIAL
OWNERSHIP(1)(2)
-------------------------- SHARES ISSUABLE
NUMBER OF PERCENT UPON EXERCISE OF
NAME OF BENEFICIAL OWNER SHARES OF CLASS STOCK OPTIONS(3)
- ------------------------ ------------- --------- ----------------
<S> <C> <C> <C>
Barry K. Allen.................... 4,000 * 0
Vaughn L. Beals, Jr............... 401,076(4) * 0
Richard I. Beattie................ 1,000 * 0
Jeffrey L. Bleustein.............. 352,530 * 81,972
Thomas A. Gelb.................... 25,127 * 0
C. William Gray................... 90,751 * 70,673
Richard J. Hermon-Taylor.......... 4,000 * 0
Donald A. James................... 20,000(5) * 0
Richard G. LeFauve................ 2,000 * 0
Sara L. Levinson.................. 1,000 * 0
James A. Norling.................. 2,000 * 0
Richard F. Teerlink............... 1,059,923 1.4% 745,100
James L. Ziemer................... 124,467 * 98,812
All Directors and Executive
Officers as a Group (14
Individuals)..................... 2,126,493 2.8% 1,073,829
Ruane, Cunniff & Co., Inc.
767 Fifth Avenue
New York, NY 10153-4798.......... 4,284,345(6) 5.7% 0
</TABLE>
- --------
* The amount shown is less than 1% of the outstanding shares of Common Stock.
(1) Except as otherwise noted, all persons have sole voting and investment
power over the shares listed.
(2) Includes shares of Common Stock issuable upon the exercise of stock
options exercisable within 60 days of March 19, 1997.
(3) Only includes stock options exercisable within 60 days of March 19, 1997.
Directors who are not employees of the Company are not eligible to receive
stock options under the Company's stock option plans.
(4) Includes 190,380 shares of Common Stock held by Mr. Beals' wife. Mr. Beals
has shared voting and investment power over such shares.
(5) Includes 20,000 shares of Common Stock held by Fred Deeley Imports Ltd.
Mr. James has sole voting power and shared investment power over such
shares.
(6) Information derived from the Schedule 13G filed by Ruane, Cunniff & Co.,
Inc. As of December 31, 1996, Ruane, Cunniff & Co., Inc. had sole voting
power over 3,424,550 shares, sole dispositive power over 1,793,745 shares
and shared dispositive power over 2,490,600 shares.
2
<PAGE>
1--ELECTION OF DIRECTORS
The Restated Articles of Incorporation of the Company provide for a Board of
not less than six (6) nor more than fifteen (15) members, as determined from
time to time by the affirmative vote of a majority of the directors then in
office. The Board is divided into three classes, with one class of directors
elected each year for a term of three years.
The Board currently consists of ten members, four of whom have terms that
expire at the Annual Meeting (Class III Directors), three of whom have terms
that expire at the 1998 annual meeting of shareholders (Class I Directors) and
three of whom have terms that expire at the 1999 annual meeting of
shareholders (Class II Directors).
The four nominees for director set forth below, all of whom are currently
Class III Directors, are proposed to be elected at the Annual Meeting to serve
until the 2000 annual meeting of shareholders. The remaining six directors
will continue to serve as members of the Board for terms as set forth below.
The nominees have advised the Company that they will serve if elected.
Directors are elected by a plurality of the votes cast (assuming a quorum is
present at the Annual Meeting). Thus, any shares not voted, whether due to
abstentions or broker nonvotes, will not have an impact on the election of
directors. A quorum consists of a majority of the shares entitled to vote
represented at the Annual Meeting in person or by proxy, including proxies
reflecting abstentions or broker nonvotes. Broker nonvotes arise from proxies
delivered by brokers and others where the record holder has not received
authority to vote on one or more matters and has no discretion to vote on such
matters. Once a share is represented at the Annual Meeting, it will be deemed
present for quorum purposes throughout the Annual Meeting (including any
adjournment thereof unless a new record date is or must be set for such
adjournment). Proxies solicited by the Board will be voted "FOR" the following
nominees unless a shareholder specifies otherwise. Should any such nominee
become unable to serve, proxies may be voted for another person designated by
the Board.
THE BOARD RECOMMENDS A VOTE "FOR" THE FOLLOWING NOMINEES.
The names, ages as of March 19, 1997, and principal occupations for the past
five years of each of the directors and nominees and the names of any other
public companies of which each is presently serving as a director are set
forth below:
NOMINEES FOR CLASS III DIRECTORS--TERMS EXPIRING AT 2000 ANNUAL MEETING
Vaughn L. Beals, Jr., 69, is Chairman Emeritus and has been a director of
the Company since 1981. He served as Chairman of the Board of the Company from
1981 to May 1996 and as Chief Executive Officer of the Company from 1981 until
his retirement in 1989. He is also a director of Lindsay Mfg. Co.
Jeffrey L. Bleustein, 57, has been a director of the Company since December
1996. He has been Executive Vice President of the Company since 1991 and
President and Chief Operating Officer of the Motor Company since 1993. He is
also a director of Rexworks, Inc.
Donald A. James, 53, has been a director of the Company since 1991. Mr.
James is a co-founder and has been the Vice Chairman and Chief Executive
Officer of Fred Deeley Imports Ltd., the largest independent motorcycle
distributorship in Canada and the exclusive distributor of the Company's
motorcycles in that country, since 1989.
James A. Norling, 55, has been a director of the Company since 1993. Mr.
Norling has served as President and General Manager, Messaging, Information
and Media Sector, for Motorola, Inc., a manufacturer of electronics, since
January 1997, as President, Europe, Middle East and Africa, and Chairman,
European Management Board, for Motorola since 1993 and as an Executive Vice
President of Motorola since 1990. From 1990 to 1993, he also served as
President and General Manager of Motorola's Semiconductor Products Sector.
3
<PAGE>
CLASS I DIRECTORS--TERMS EXPIRING AT 1998 ANNUAL MEETING
Barry K. Allen, 48, has been a director of the Company since 1992. Mr. Allen
has served as Executive Vice President of Ameritech Corporation, a
telecommunications company, since August 1995. From September 1993 to August
1995, he was President and Chief Operating Officer and a director of Marquette
Electronics, Inc., a manufacturer of medical equipment and systems. From July
1993 to September 1993, he was President of Illinois Bell, Inc., a provider of
communications and information services, and from 1989 to July 1993, he was
President and Chief Executive Officer of Wisconsin Bell, Inc., a provider of
communications and information services.
Richard I. Beattie, 57, has been a director of the Company since August
1996. He has been a partner of Simpson Thacher & Bartlett, a law firm, since
1977 and has served as Chairman of the Executive Committee of that firm since
1991.
Richard G. LeFauve, 62, has been a director of the Company since 1993. He
has been Group Executive, NAO Small Car Group of General Motors Corporation,
an automobile manufacturer, since 1994, Chairman of Saturn Corporation, an
automobile manufacturer, since 1995 and a Vice President of General Motors
Corporation since 1985. He served as President of Saturn Corporation from 1986
to 1995.
CLASS II DIRECTORS--TERMS EXPIRING AT 1999 ANNUAL MEETING
Richard J. Hermon-Taylor, 55, has been a director of the Company since 1986.
He has been President of BioScience International, Inc., a technology transfer
company, since 1987, and a Vice President of Symmetrix, Inc., a business
consulting firm, since March 1994. From 1990 to 1992, he was Chief Executive
Officer of Tonometrics, Inc., a manufacturer of medical devices.
Sara L. Levinson, 46, has been a director of the Company since February
1996. She has been President of NFL Properties, Inc., the trademark licensing
company for the National Football League, since September 1994. From 1986 to
September 1994, she held various executive positions with Viacom, Inc., a
media and entertainment company, including President-Business Director of MTV
from 1993 to September 1994, Executive Vice President-Business Operations of
MTV from 1991 to 1993, and Vice President-New Business of MTV, Nickelodeon and
VH-1 from 1986 to 1991.
Richard F. Teerlink, 60, has been a director of the Company since 1982. He
has been Chairman of the Board of the Company since May 1996, Chief Executive
Officer of the Company since 1989 and President of the Company since 1988. He
is also a director of Johnson Controls, Inc. and Outboard Marine Corporation.
BOARD OF DIRECTORS--COMMITTEE AND OTHER INFORMATION
The Board has three committees: the Audit Committee, the Human Resources
Committee and the Nominating and Director Affairs Committee.
The Audit Committee, the current members of which are Richard I. Beattie,
Donald A. James, Sara L. Levinson and James A. Norling (Chairman), met two
times during 1996. The Audit Committee selects, subject to shareholder
ratification, and engages independent public accountants to audit the books,
records and accounts of the Company. The Audit Committee also determines the
scope of such audits and reviews the adequacy of the internal accounting
controls of the Company.
The Human Resources Committee, the current members of which are Barry K.
Allen, Richard J. Hermon-Taylor and Richard G. LeFauve (Chairman), met six
times during 1996. The Human Resources Committee approves certain compensation
and benefits actions, reviews performance of senior management and advises
management on matters of succession planning, career development and human
resources strategies.
The Nominating and Director Affairs Committee, the current members of which
are Barry K. Allen (Chairman), Richard I. Beattie, Richard J. Hermon-Taylor,
Donald A. James, Richard G. LeFauve, Sara L. Levinson and James A. Norling,
met four times during 1996. The Nominating and Director Affairs Committee
4
<PAGE>
identifies and recommends to the full Board candidates for service on the
Board and reviews Board performance and Board committee composition.
Shareholders may recommend candidates for consideration by the Nominating and
Director Affairs Committee by writing to the Nominating and Director Affairs
Committee in care of the Secretary of the Company. Such recommendations for
the 1998 annual meeting of shareholders must be received by the Company on or
before November 28, 1997. Any shareholder who desires to nominate directly a
director candidate for consideration by the shareholders must give written
notice thereof to the Secretary of the Company in advance of the applicable
meeting in compliance with the terms and within the time periods specified in
the Company's Restated Articles of Incorporation.
The Board has four regular quarterly meetings per year and met eight times
during 1996. All directors attended at least 75% of the meetings of the Board
and the Board committees on which they served during 1996.
Directors who are employees of the Company do not receive any special
compensation for their services as directors. Except for Mr. Beals, directors
who are not employees of the Company received in 1996 an annual fee of $25,000
plus $1,500 for each regular meeting of the Board, $750 for each special
meeting of the Board and $750 for each Board committee meeting; provided that
directors do not receive any additional compensation for more than two Board
committee meetings in connection with any Board meeting. The Company
reimburses directors for any travel expenses incurred in connection with
attending Board or Board committee meetings.
The Company has a consulting contract with Mr. Beals pursuant to which Mr.
Beals is paid $242,240 per year. The consulting term expires June 30, 1998.
The consulting contract also provides for supplemental retirement benefits of
$159,840 per year after the consulting term expires until his death. In the
event of Mr. Beals' death prior to the end of the consulting term, the
consulting agreement provides, as a death benefit, the continuation of certain
payments under the consulting agreement through July 1, 1999.
5
<PAGE>
EXECUTIVE COMPENSATION
The following table shows the aggregate compensation, including incentive
compensation, paid by the Company for 1996, 1995 and 1994 to the Chief
Executive Officer and each of the four other most highly compensated executive
officers of the Company for 1996:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION AWARDS
------------------------- ---------------------
OTHER RESTRICTED SECURITIES ALL OTHER
ANNUAL STOCK UNDERLYING COMPENSA-
NAME AND PRINCIPAL BONUS COMPENSA- AWARDS(1) OPTIONS TION(2)
POSITION YEAR SALARY ($) TION ($) ($) (#) ($)
- ------------------ ---- ($) ------- --------- ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Richard F. Teerlink
Chairman, President and
CEO................... 1996 518,751 715,000 41,818 0 90,000 32,042
President and CEO...... 1995 486,303 500,000 40,140 0 90,000 27,683
President and CEO...... 1994 440,901 700,000 39,481 0 100,000 27,541
Jeffrey L. Bleustein
President and COO--
Motor Company......... 1996 370,227 362,082 36,673 0 41,000 27,945
President and COO--
Motor Company......... 1995 318,183 269,183 35,945 538,800 48,000 22,935
President and COO--
Motor Company......... 1994 283,257 265,297 35,866 0 50,000 23,553
Thomas A. Gelb
Vice President,
Continuous
Improvement........... 1996 277,199 225,917 28,009 0 16,068 21,483
Vice President,
Continuous
Improvement........... 1995 263,400 185,697 27,793 202,050 36,211 19,436
Vice President,
Continuous
Improvement........... 1994 250,839 194,834 26,533 0 40,000 18,302
James L. Ziemer
Vice President and CFO. 1996 201,522 196,282 21,497 0 21,721 11,894
Vice President and CFO. 1995 177,633 139,993 21,304 0 18,858 9,364
Vice President and CFO. 1994 167,953 130,456 21,775 0 18,542 9,415
C. William Gray
Vice President, Human
Resources............. 1996 199,832 162,863 23,088 586,300 22,765 43,492
Vice President, Human
Resources............. 1995 185,436 130,732 22,213 0 28,124 33,008
Vice President, Human
Resources............. 1994 175,129 136,190 22,173 0 19,140 34,227
</TABLE>
- --------
(1) As of December 31, 1996, the named executive officers of the Company
holding unvested restricted stock were Messrs. Bleustein, Gelb and Gray,
who held 20,000, 7,500 and 16,400 shares, respectively, valued at
$940,000, $352,500 and $770,800, respectively. Dividends are paid on
shares of unvested restricted stock.
(2) The 1996 amounts for Messrs. Teerlink, Bleustein, Gelb, Ziemer and Gray
include the value of split dollar life insurance provided by the Company,
a 401(k) matching contribution of $4,750, a $200 health care spending
account credit (other than Mr. Teerlink), and a Motor Company non-
qualified deferred compensation plan matching contribution of $12,500,
$14,432, $7,200, $5,495 and $5,167, respectively. The 1996 amount for Mr.
Gray also includes $30,000 of loan forgiveness relating to an interest
free relocation loan.
6
<PAGE>
STOCK OPTIONS
During 1996, the Human Resources Committee granted options to purchase
shares of Common Stock under the Company's 1995 Stock Option Plan to the Chief
Executive Officer and the other named executive officers as follows:
OPTION GRANTS IN 1996
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
ASSUMED ANNUAL RATES OF STOCK
APPRECIATION FOR OPTION TERM
INDIVIDUAL GRANTS (1) (2)
----------------------------------------- ----------------------------------
NUMBER OF PERCENT OF
SECURITIES TOTAL
UNDERLYING OPTIONS EXERCISE
OPTIONS GRANTED TO PRICE EXPIRATION
NAME GRANTED EMPLOYEES ($/SH) DATE 0% 5% 10%
---- ---------- ---------- -------- ---------- --- ------------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Richard F. Teerlink..... 90,000 16.4% $35.75 2/14/06 $0 $ 2,022,768 $ 5,125,687
Jeffrey L. Bleustein.... 41,000 7.5 35.75 2/14/06 0 921,483 2,335,035
Thomas A. Gelb.......... 16,068 2.9 35.75 2/14/06 0 361,132 915,106
James L. Ziemer......... 21,721 4.0 35.75 2/14/06 0 488,184 1,237,056
C. William Gray......... 22,675 4.1 35.75 2/14/06 0 509,625 1,291,388
All Optionees........... 548,540 100.0 35.75 2/14/06 0 12,328,546 31,240,496
All Shareholders........ N/A N/A N/A N/A 0 1,687,577,710(3) 4,276,653,255(3)
</TABLE>
- --------
(1) The options granted under the 1995 Stock Option Plan are non-qualified
stock options. The exercise price per share is 100% of the fair market
value of a share of Common Stock on the date of the grant. The Human
Resources Committee has the authority to grant options and set or amend
the terms and conditions of the option agreements. The exercise price of
an option may be paid in cash, shares of Common Stock or a combination of
cash and stock (subject to the conditions that may be set by the Human
Resources Committee). The options may be exercised one year after the date
of grant, not to exceed 25% of the shares in the first year, with an
additional 25% to be exercisable in each of the following three years.
Options expire ten years from the date of grant. Each option granted under
the 1995 Stock Option Plan has a limited right which permits the holder to
surrender the option within 30 days after a change of control of the
Company and receive the difference between the exercise price of the
option and the highest closing price of the Common Stock during the 60-day
period preceding the change of control of the Company.
(2) The option term is ten years. The dollar amounts under these columns are
the results of calculations at 0% and at the 5% and 10% rates set by the
Securities and Exchange Commission. The potential realizable values are
not intended to forecast possible future appreciation, if any, in the
market price of the Common Stock.
(3) Represents corresponding gain to all shareholders on 75,060,223 shares of
Common Stock outstanding on February 15, 1996, the date on which the
options included in the table were granted, calculated based on fair
market value of such Common Stock on such date.
7
<PAGE>
Shown below is information relating to the exercise of options by the Chief
Executive Officer and the other named executive officers during 1996 and the
value of unexercised options held by such persons as of December 31, 1996.
AGGREGATED OPTION EXERCISES IN 1996
AND OPTION VALUES AT DECEMBER 31, 1996
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS
SHARES AT DECEMBER 31, 1996 AT DECEMBER 31, 1996
ACQUIRED ON VALUE (#) ($)(2)
EXERCISE REALIZED ------------------------- -------------------------
NAME (#) ($)(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- --------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Richard F. Teerlink..... 0 0 675,100 207,500 $25,522,708 $3,499,550
Jeffrey L. Bleustein.... 121,802 3,225,020 47,222 102,000 1,097,934 1,749,910
Thomas A. Gelb.......... 69,733 1,367,866 5,000 63,226 142,200 1,178,754
James L. Ziemer......... 0 0 84,031 45,134 2,976,267 738,128
C. William Gray......... 12,000 349,890 53,207 53,336 1,573,139 895,030
</TABLE>
- --------
(1) Value based on the fair market value of Common Stock on the date of
exercise less the option exercise price.
(2) Value based on a fair market value of Common Stock of $47.00 on December
31, 1996 less the option exercise price.
RETIREMENT BENEFITS
The following table shows at different levels of remuneration and years of
credited service the estimated net annual benefits payable as a straight life
annuity to each of the named executive officers under the Salaried Pension
Plan, the Restoration Plan and the Supplemental Agreements (all as defined
below), assuming retirement at age 62:
PENSION PLAN TABLE
<TABLE>
<CAPTION>
YEARS OF SERVICE
----------------------------------------------------------------------
REMUNERATION 5 10 15 20 25 30 35 15+(1)
------------ ------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
$ 200,000.............. $15,382 $ 30,764 $ 46,147 $ 61,529 $ 76,911 $ 92,293 $107,676 $100,000
300,000.............. 23,382 46,764 70,147 93,529 116,911 140,293 163,676 150,000
400,000.............. 31,382 62,764 94,147 125,529 156,911 188,293 219,676 200,000
500,000.............. 39,382 78,764 118,147 157,529 196,911 236,293 275,676 250,000
600,000.............. 47,382 94,764 142,147 189,529 236,911 284,293 331,676 300,000
800,000.............. 63,382 126,764 190,147 253,529 316,911 380,293 443,676 400,000
1,000,000.............. 79,382 158,764 238,147 317,529 396,911 476,293 555,676 500,000
1,250,000.............. 99,382 198,764 298,147 397,529 496,911 596,293 695,676 625,000
</TABLE>
- --------
(1) This column applies only to Messrs. Teerlink, Bleustein and Gelb, who are
entitled to supplemental benefits under their Supplemental Agreements upon
retirement at age 62. Mr. Gray also has a Supplemental Agreement but would
not have the required 15 years of service upon retirement at age 62.
The Company maintains the Retirement Annuity Plan for Salaried Employees of
Harley-Davidson, a noncontributory defined benefit pension plan ("Salaried
Pension Plan"). Under the Salaried Pension Plan, salaried employees of the
Company (excluding certain subsidiaries), including the Chief Executive
Officer and the other named executive officers, are generally eligible to
retire with unreduced benefits at age 62 or later. Benefits are based upon
monthly "final average earnings" as defined in the Salaried Pension Plan.
Prior to December 31, 1994, the monthly benefit is the difference between 1.6%
of the final average earnings and .9% of
8
<PAGE>
the primary monthly social security benefit multiplied by years of service. On
and after December 31, 1994, the revised benefit is 1.2% of the final average
earnings plus .4% of the final average earnings in excess of Social Security
covered compensation multiplied by years of service. The benefit of a person
with service on or after December 31, 1994, is the greater of his or her
benefit determined using the revised formula for all service or the sum of his
or her benefit under the former formula for service through December 31, 1993,
and his or her benefit under the revised formula for service after that date.
For the named executive officers, final average earnings equal one-twelfth of
the highest average annual total compensation (consisting of base salary and
bonus as shown in the Summary Compensation Table) paid over five consecutive
calendar years within the last ten years of service prior to the participant's
retirement or other date of termination. Vesting under the Salaried Pension
Plan occurs upon the earlier of five years of service or age 65. An employee
who retires after age 55 and before age 62 with a minimum of 5 years of
service will receive an actuarially reduced benefit under the Salaried Pension
Plan. The surviving spouse of an employee who is eligible for early retirement
or who is vested at death is also entitled to certain benefits under the
Salaried Pension Plan.
The Company has adopted the Pension Benefit Restoration Plan (the
"Restoration Plan") pursuant to which the Company will pay participants
amounts that exceed certain limitations the Internal Revenue Code imposes on
benefits payable under the Salaried Pension Plan. Calculated as of December
31, 1996, annualized final average earnings and years of credited service
under the Salaried Pension Plan and the Restoration Plan were as follows:
$911,519 and 15.4 years, respectively, for Mr. Teerlink; $504,999 and 25.9
years, respectively, for Mr. Bleustein; $404,388 and 21.2 years, respectively,
for Mr. Gelb; $287,126 and 21.2 years, respectively, for Mr. Ziemer; and
$290,555 and 6.3 years, respectively, for Mr. Gray.
The Company has Supplemental Executive Retirement Plan Agreements (the
"Supplemental Agreements") with the Chief Executive Officer and the other
named executive officers (other than Mr. Ziemer). Under the Supplemental
Agreements, a participant who retires at or after age 55 with 15 years of
service is entitled to a yearly retirement benefit payment equal to 35% of the
executive's annualized final average earnings at age 55 increasing in equal
increments to 50% of annualized final average earnings at age 62, reduced by
the amount of any pension payable by the Company under the Salaried Pension
Plan, by any other defined benefit retirement programs of the Company and by
the amount of benefits under the Restoration Plan. Amounts payable under the
Restoration Plan and the Supplemental Agreements may be partially or fully
funded at retirement through the use of split-dollar life insurance, lump sum
cash payments and/or other means.
AGREEMENTS
The Company has entered into employment agreements with Messrs. Teerlink,
Bleustein and Gelb, which provide that, upon termination of employment for
reasons other than cause, the Company will pay each such employee certain
amounts, including such employee's base compensation in effect on the date of
such termination (which currently would approximate the amount of cash
compensation set forth in the Summary Compensation Table) for a period not
exceeding one year (three years in the case of Mr. Teerlink), together with
other benefits to which such employee was entitled prior to termination. Such
employment agreements do not establish minimum base salary levels for such
employees.
The Company offers a standard form of Severance Benefits Agreement to
certain senior managers. Most of these senior managers, including all of the
named executive officers, have executed this agreement. The Severance Benefits
Agreement provides for up to one year's salary and up to one year of certain
employee benefits in the event of a termination of employment by the Company
other than for cause.
The Company has entered into transition agreements with Messrs. Teerlink,
Bleustein, Gelb, Ziemer and Gray which become effective upon a change of
control of the Company as defined therein. The transition agreements provide
that, in the event of termination of such individual's employment with the
Company for any reason (other than death) within two years (three years in the
case of Mr. Teerlink) after a change of control of the Company, such
individual will receive a cash payment in an amount equal to the product of
three multiplied
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by the sum of (1) the individual's highest annual base salary during the five-
year period preceding termination, (2) the highest annual bonus paid during
the five-year period preceding termination and (3) the individual's annual
perquisite payment. Such individuals will also receive immediate vesting in
any retirement, incentive, stock option and other deferred compensation plans.
In addition, the covered individuals will receive three years of continued
medical benefits and outplacement services. The contracts state that if any of
the payments to the employees are considered "excess parachute payments" as
defined in Section 280G of the Internal Revenue Code, then the Company will
pay the penalty imposed upon the employee plus a tax gross-up.
A "change of control" for purposes of the transition agreements includes the
following events: (i) continuing directors no longer constitute at least two-
thirds of the directors serving on the Board, (ii) any person or group becomes
a beneficial owner of 20% or more of the Common Stock, (iii) the Company's
shareholders approve a merger involving the Company, the sale of substantially
all of the Company's assets or the liquidation or dissolution of the Company,
unless in the case of a merger continuing directors constitute at least two-
thirds of the directors serving on the board of directors of the survivor of
such merger, or (iv) at least two-thirds of the continuing directors determine
that a proposed action, if taken, would constitute a change of control of the
Company and such action is taken. A continuing director is a director of the
Company who was a director on a specified date (generally on or shortly prior
to the date of the applicable transition agreement) or who was nominated or
elected by two-thirds of the continuing directors (except in the case of an
actual or threatened proxy or control contest).
Certain senior managers, including all of the named executive officers, are
entitled to receive a lump sum payment equal to one year's salary plus
applicable taxes upon retirement at or after age 55. This benefit has been
adopted by the Company in lieu of providing post-retirement life insurance.
The Company has entered into Supplemental Executive Retirement Plan Agreements
with Messrs. Teerlink, Bleustein, Gelb and Gray. The terms of these agreements
are described above under "Retirement Benefits." In February 1997, the Company
amended Mr. Gelb's Restricted Stock Agreement to provide that the 7,500 shares
covered by the agreement vest upon Mr. Gelb's retirement.
BOARD OF DIRECTORS HUMAN RESOURCES COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Human Resources Committee is responsible for establishing, reviewing and
revising the compensation policies for the Company's executive officers. The
Human Resources Committee is composed entirely of directors who are not
employees or former employees of the Company and who do not have a business
relationship with the Company other than in their capacity as directors.
This report is being included pursuant to Securities and Exchange Commission
("SEC") rules designed to enhance disclosure of public companies' executive
compensation policies. This report addresses the Company's compensation
policies for 1996 as they affected the Chief Executive Officer and the
Company's other executive officers, including the other named executive
officers.
General
Under the supervision of the Human Resources Committee, the Company has
developed and implemented compensation policies, plans and programs that seek
to attract and retain qualified and talented employees and enhance the
profitability of the Company. In furtherance of these goals and in addition to
benefit plans available to salaried employees generally, the Company's
executive compensation policies, plans and programs consisted of base salary,
annual incentive compensation, annual stock option grants, annual perquisite
payments, the Restoration Plan, the Supplemental Agreements, a non-qualified
deferred compensation plan and life insurance benefits.
In addition to the experience and knowledge of the Human Resources Committee
and the Company's Human Resources staff, the Human Resources Committee
utilizes the services of an independent human
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resources consultant in making its executive compensation decisions. Each year
the Company's Human Resources staff selects several executive or other senior
officer positions for bench-marking against comparable companies. The
comparable companies are Fortune 500 "make and sell" companies with annual
sales of $1 billion to $2 billion having comparable performance. The
independent human resources consultant retained by the Company conducts a
survey of compensation packages for the specified types of executive or senior
officer positions at the comparable companies and prepares a written analysis
(the "Independent Compensation Analysis"). The Independent Compensation
Analysis includes median base salary (including the percentage increase over
the prior year), median annual bonus percentage and median stock option
information for the comparable companies by position. The Independent
Compensation Analysis also recommends ranges for base salary, annual bonus and
stock option compensation for the selected Company executive or senior officer
positions.
The comparable companies used to benchmark executive compensation are not
included on the Performance Graph included below because they change from year
to year depending on both the Company's and other companies' performance. The
purpose of the Performance Graph is to compare the performance of the
Company's Common Stock over a five-year period against a stock index or a
fixed group of companies. In contrast, the Company generally utilizes
compensation surveys to compare its executive compensation policies against
companies that have specified performance and other characteristics similar to
those of the Company during a limited period of time. The Company believes
that including such companies as a separate group on the Performance Graph
would be confusing and potentially misleading.
In general, it is the policy of the Human Resources Committee to fix
executive base salary range midpoints at levels below the median amounts paid
to executives with similar qualifications, experience and responsibilities at
other comparable businesses. Executives' actual salaries are subjectively
determined by individual performance evaluations and potential future
contributions to the Company. It is also the policy of the Human Resources
Committee generally to establish maximum incentive cash compensation and stock
option grants at levels above the median amounts paid or granted to executives
with similar qualifications, experience and responsibilities at other
comparable businesses. The Company intends to provide a total compensation
opportunity for Company executives that is above average, but with an above
average amount of the total compensation opportunity at risk and dependent
upon continuously improving Company performance. In all cases, the Human
Resources Committee considers the total potential compensation payable to each
of the named executive officers and other executives when establishing or
adjusting any element of their compensation package.
1996 Base Salary
Executive base salaries are reviewed annually. In February 1996, the Human
Resources Committee, in consultation with the Vice President, Human Resources,
increased Mr. Teerlink's base salary by 5%. This increase was within the range
recommended by the Independent Compensation Analysis and was based upon the
Human Resources Committee's subjective assessment of Mr. Teerlink's past
performance (including his leadership, his role in the financial performance
of the Company and his role in implementing new educational programs at all
levels of the Company) and its expectations for his future contributions in
leading the Company. Also in February 1996, the Human Resources Committee
reviewed, with the Chief Executive Officer and Vice President, Human
Resources, and approved, with modifications it deemed appropriate, the annual
salary plan for the Company's other executive officers. The annual salary plan
was subjectively developed by the Company's Human Resources staff under the
direction of the Chief Executive Officer and the President of the Motor
Company based primarily upon each executive's individual performance
evaluation for the prior year, the anticipated future contribution of each
executive and the Independent Compensation Analysis. 1996 base salaries for
the named executive officers are set forth in the Summary Compensation Table.
Based on the annual Independent Compensation Analysis, the Human Resources
Committee believes that the base salaries paid to the Company's executive
officers are generally below the median of base salaries paid to comparable
executive officers of comparable companies.
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<PAGE>
1996 Incentive Cash Compensation
The Company had two separate short term incentive plans in which executive
officers participated for 1996: Messrs. Teerlink, Gelb and Ziemer participated
in the Company's Corporate Short Term Incentive Plan (the "Corporate STIP")
and the other named executive officers and certain other executive officers
participated in the Motor Company 1996 Short Term Incentive Plan (the "Motor
Company STIP"). In December 1995, the Human Resources Committee reviewed and
approved the Motor Company STIP for 1996 and target awards for participants in
the Motor Company STIP. Also in December 1995, the Human Resources Committee
established the performance target (consolidated net income) and target awards
under the Corporate STIP for 1996 for participating executives. Award payouts
under the Motor Company STIP were based upon Motor Company financial targets
related to earnings (weighted 50%) and Motor Company objectively measured
strategic targets related to product quality, working capital and employee
development (weighted 50%). The target awards for the five named executive
officers ranged from 50% to 100% of their respective 1996 base salaries. The
amount of each executive's target award is subjectively reviewed annually
based upon the Independent Compensation Analysis, the executive's individual
performance evaluation for the prior year and the Human Resources Committee's
appraisal of the executive's anticipated future contribution to the Company.
Depending on Company performance and, in the case of the Corporate STIP, the
subjective determination of the Human Resources Committee with respect to
downward adjustments, actual short term incentive plan awards can range from
0% to 200% of the target award.
Under the Corporate STIP formula based on the consolidated net income
performance criteria selected by the Human Resources Committee and actual
Company performance, Mr. Teerlink was eligible to receive a maximum award of
$1,010,528 for 1996, or 195% of the target award. Under the terms of the
Corporate STIP, the Human Resources Committee has the discretion to reduce
awards determined by the formula by up to 50%. The Human Resources Committee
exercised its discretion and subjectively determined that Mr. Teerlink's
actual 1996 STIP award would be $715,000. The Human Resources Committee based
its determination in part on the percentage payout for 1996 under the Motor
Company STIP (163%) and the financial and strategic performance of the Company
as a whole. An evaluation of the financial and strategic performance of the
Company as a whole indicated significant accomplishment in both categories.
The Committee also considered the completion of the disposition of the
Company's Transportation Vehicles segment during 1996. Mr. Gelb's and Mr.
Ziemer's actual 1996 Corporate STIP awards were determined by the Committee in
a similar manner. The awards for the other executive officers were determined
mathematically under the Motor Company STIP. All short term incentive plan
awards paid or payable for 1996 by the Company with respect to the named
executive officers are set forth in the Summary Compensation Table.
1996 Stock Option Grants
While the short term incentive plans provide Company executives with short
term incentives to maximize Company performance, the Human Resources Committee
believes that it is also important to provide incentives that more directly
tie executives' long term compensation to long term returns to the Company's
shareholders. This long term incentive compensation opportunity is provided
through the Company's stock option plans (the "Option Plans"). Annually, the
Human Resources Committee reviews, with the Vice President, Human Resources
and, except in the case of his own stock option grant, the Chief Executive
Officer, and approves individual stock option grants for each of the Company's
executive officers, including the named executive officers. The amount of each
executive's stock option grant is subjectively determined by the Human
Resources Committee based upon the annual Independent Compensation Analysis,
the executive's individual performance evaluation for the prior year, the
executive's base salary and the Human Resources Committee's appraisal of the
executive's anticipated long term future contribution to the Company. The
stock options granted to the named executive officers in 1996 are set forth in
the Summary Compensation and Option Grants Tables.
1996 Restricted Stock Grant
In February 1996, upon the recommendation of the Chief Executive Officer,
the Human Resources Committee recommended to the Board that the Board make a
discretionary grant of restricted stock to Mr. Gray
12
<PAGE>
in the amount set forth in the Summary Compensation Table. In making its
recommendation, the Human Resources Committee subjectively evaluated the
substantial contributions of Mr. Gray during 1995, in particular his roles in
causing the Motor Company to meet or exceed certain key human resources goals.
The Human Resources Committee also considered Mr. Gray's expected future
contributions to the Company and desired to provide him additional incentive
to remain with the Company. The Board accepted the recommendation of the Human
Resources Committee and granted the restricted stock.
Other Compensation
The Human Resources Committee believes that the compensation paid or payable
pursuant to the Company's annual perquisite payments, Restoration Plan,
Supplemental Agreements, non-qualified deferred compensation plan, life
insurance benefits and the benefit plans available to salaried employees
generally is competitive with the benefit packages offered by comparable
employers. From time to time the Human Resources Department of the Motor
Company obtains data to ensure that such benefit plans and programs remain
competitive. The Human Resources Committee most recently reviewed such data in
December 1995.
Internal Revenue Code Section 162(m)
Section 162(m) of the Internal Revenue Code provides that a publicly held
corporation will not be entitled to deduct for federal income tax purposes
compensation paid to a named executive officer in excess of $1 million in any
year. Incentive compensation based on company performance, provided it is paid
pursuant to a plan which has been approved by shareholders and meets certain
other criteria, is not subject to Section 162(m). It is the Human Resources
Committee's intention to continue to utilize incentive compensation as a
substantial component of the Company's executive compensation program and to
attempt to structure the payment of incentive compensation so that the Company
will not lose deductions under Section 162(m).
Conclusion
Over the last three calendar years, shareholders of the Company have enjoyed
a total return of 117%. During that same period of time the Standard & Poor's
500 and MidCap 400 Indexes had total returns of 71% and 50%, respectively. The
Human Resources Committee believes that the compensation policies and
practices of the Company described in this report have supported this
performance. In addition, the Human Resources Committee believes that these
compensation policies and practices are in the best interests of the Company
and consistent with the Company's commitment to balance the interests of all
of the Company's stakeholders (customers, dealers, suppliers, employees,
investors, government and society).
Richard G. LeFauve, Chairman
Barry K. Allen
Richard J. Hermon-Taylor
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<PAGE>
PERFORMANCE GRAPH
The SEC requires the Company to include in this Proxy Statement a line graph
presentation comparing cumulative five year Common Stock returns with a broad-
based stock index and either a nationally recognized industry index or an
index of peer companies selected by the Company. The Company has chosen to use
the Standard & Poor's 500 Index as the broad-based index and the Standard &
Poor's MidCap 400 Index as a more specific comparison. The Standard & Poor's
MidCap 400 Index was chosen because the Company does not believe that any
other published industry or line-of-business index adequately represents the
current operations of the Company or that it can identify a peer group that
provides a useful comparison.
PERFORMANCE GRAPH
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
LOGO
<TABLE>
<CAPTION>
1991 1992 1993 1994 1995 1996
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Harley-Davidson, Inc. $100.00 $168.16 $197.78 $252.36 $260.85 $428.64
----------------------------------------------------------------------------------------
S&P MidCap 400 100.00 111.91 127.53 122.96 161.00 191.91
----------------------------------------------------------------------------------------
S&P 500 100.00 107.62 118.46 120.03 165.13 203.05
</TABLE>
- --------
* Assumes $100 invested on December 31, 1991.
14
<PAGE>
CERTAIN TRANSACTIONS
Mr. James, a director of the Company, is Vice Chairman, Chief Executive
Officer and an equity owner of Fred Deeley Imports Ltd. ("Deeley Imports"),
the exclusive distributor of the Company's motorcycles in Canada. In 1996,
Deeley Imports paid the Company approximately $57 million for motorcycles,
parts and accessories and related products and services. All such products and
services were provided in the ordinary course of business at prices and on
terms and conditions determined through arms-length negotiation. The Company
anticipates that it will do a similar amount of business with Deeley Imports
in 1997.
Mr. Beattie, a director of the Company, is a partner and Chairman of the
Executive Committee of Simpson Thacher & Bartlett, a law firm. Simpson Thacher
& Bartlett served as outside counsel for the Company in various legal matters
during 1996. The Company anticipates that it will continue to retain Simpson
Thacher & Bartlett as outside counsel for various legal matters in 1997.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Under Section 16(a) of the Securities Exchange Act of 1933, the Company's
executive officers are required to disclose their holdings of and transactions
in the Common Stock on forms prescribed by the Securities and Exchange
Commission. During 1996, Mr. Gelb did not report one open market sale
transaction on a timely basis and Ms. Levinson filed her Form 3 five days
late.
2--RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
Ernst & Young LLP, independent public accountants, audited the Company's
consolidated financial statements for the fiscal year ended December 31, 1996.
Representatives of Ernst & Young LLP will be present at the Annual Meeting to
respond to appropriate questions and to make a statement, if they so desire.
Ernst & Young LLP has been recommended by the Audit Committee and selected by
the Board to serve as the Company's independent auditors for the current
fiscal year, and in accordance with a resolution of the Board, this selection
is being presented to shareholders for ratification.
If prior to the Annual Meeting, Ernst & Young LLP shall decline to act or
its engagement shall be otherwise discontinued by the Board, then the Board
will appoint other independent auditors whose engagement for any period
subsequent to the Annual Meeting will be subject to ratification by the
shareholders at the Annual Meeting. If the shareholders fail to ratify the
engagement of Ernst & Young LLP at the Annual Meeting, then the Board will
reconsider its selection of independent auditors. Proxies solicited by the
Board will be voted "FOR" ratification of the selection of Ernst & Young LLP
as the independent auditors of the Company for the fiscal year ending December
31, 1997, unless the shareholder specifies otherwise.
THE BOARD RECOMMENDS A VOTE "FOR" RATIFICATION OF THE SELECTION OF ERNST &
YOUNG LLP AS THE COMPANY'S INDEPENDENT AUDITORS.
3--OTHER MATTERS
The matters referred to herein are, as far as management now knows, the only
matters that will be presented for consideration at the Annual Meeting. Among
other things, to bring business before an annual meeting, a shareholder must
give written notice thereof to the Secretary of the Company in advance of the
meeting in compliance with the terms and within the time periods specified in
the Company's Restated Articles of Incorporation. If any other matter should
properly come before the Annual Meeting, then it is the intention of the
persons named in the accompanying form of proxy to vote the shares represented
by them in accordance with their judgment.
15
<PAGE>
The cost of soliciting proxies will be borne by the Company. Proxies may be
solicited by personal interview, telephone, telegraph and facsimile machine,
as well as by use of the mails. It is anticipated that banks, brokerage houses
and other custodians, nominees or fiduciaries will be requested to forward
soliciting materials to their principals and to obtain authorization for the
execution of proxies and that they will be reimbursed for their out-of-pocket
expenses incurred in that connection. Employees of the Company participating
in the solicitation of proxies will not receive any additional remuneration.
The Company has retained D. F. King & Co., Inc. to aid in the solicitation at
an estimated cost of approximately $6,000 plus out-of-pocket expenses.
SHAREHOLDER PROPOSALS
Proposals by shareholders that are intended to be presented at the 1998
annual meeting of shareholders must be received by the Company no later than
November 28, 1997, to be eligible for inclusion in the Company's proxy
materials for that meeting.
By Order of the Board of Directors,
LOGO
Timothy K. Hoelter
Assistant Secretary
Milwaukee, Wisconsin
March 28, 1997
LOGO
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<PAGE>
HARLEY-DAVIDSON, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR MAY 3, 1997 ANNUAL MEETING OF SHAREHOLDERS
The undersigned appoints each of Richard F. Teerlink and Jeffrey L.
Bleustein attorney and agent, with full power of substitution and
resubstitution, to vote as proxy in the name, place and stead of the undersigned
at the Annual Meeting of Shareholders of HARLEY-DAVIDSON, INC. to be held on May
3, 1997 and at any adjournment thereof (the "Meeting") according to the number
of votes that the undersigned would be entitled to vote if personally present.
Without limiting the generality hereof, each of such persons is authorized to
vote:
(i) as herein specified upon the proposals listed hereon and described in the
Proxy Statement for the Meeting; and
(ii) in his discretion upon any other matter that may properly come before the
Meeting.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES AS DIRECTORS AND FOR
ITEM 2.
THE SHARES REPRESENTED BY THIS PROXY SHALL BE VOTED AS SPECIFIED. IF NO
SPECIFICATION IS MADE, THE SHARES SHALL BE VOTED AS RECOMMENDED BY THE BOARD OF
DIRECTORS.
PLEASE MARK, SIGN AND DATE BELOW,
DETACH AND RETURN PROMPTLY USING THE ENVELOPE PROVIDED
<PAGE>
HARLEY-DAVIDSON, INC. 1997 ANNUAL MEETING
1. ELECTION OF DIRECTORS: 1 - Vaughn L. Beals, Jr., 2 - Jeffrey L. Bleustein,
3 - Donald A. James, 4 - James A. Norling
[ ] FOR all [ ] WITHHOLD AUTHORITY
nominees listed to to vote for all
the left (except as nominees listed
specified below). to the left.
------------------
(INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE ----------
FOR ANY NOMINEE(S), WRITE THE NUMBER(S) OF ------------------
THE NOMINEE(S) IN THE BOX PROVIDED TO THE
RIGHT.)
2. RATIFICATION OF AUDITORS: [ ] FOR [ ] AGAINST [ ] ABSTAIN
Address Change? Date NO. OF SHARES
Mark Box [ ] ----------------------
Indicate changes below: ------------------
------------------
Signature(s) in Box
IMPORTANT: Please sign your name exactly as it appears on the Proxy. Joint
owners should each sign personally. A corporation should sign in full corporate
name by duly authorized officers. When signing as attorney, executor, or
administrator, trustee or guardian, please give your full title as such.
