Harley Davidson 2013 Annual Report Download - page 93

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responses to the EPA’s inquiry and has engaged in discussions with the EPA. Since that time, the EPA has delivered various
additional requests for information to which the Company has responded. It is possible that a result of the EPA’s investigation
will be some form of enforcement action by the EPA that will seek a fine or other relief. However, at this time the Company
does not know and cannot reasonably estimate the impact of any remedies the EPA might seek.
York Environmental Matters:
The Company is involved with government agencies and groups of potentially responsible parties in various
environmental matters, including a matter involving the cleanup of soil and groundwater contamination at its York,
Pennsylvania facility. The York facility was formerly used by the U.S. Navy and AMF prior to the purchase of the York facility
by the Company from AMF in 1981. Although the Company is not certain as to the full extent of the environmental
contamination at the York facility, it has been working with the Pennsylvania Department of Environmental Protection
(PADEP) since 1986 in undertaking environmental investigation and remediation activities, including an ongoing site-wide
remedial investigation/feasibility study (RI/FS). In January 1995, the Company entered into a settlement agreement (the
Agreement) with the Navy. The Agreement calls for the Navy and the Company to contribute amounts into a trust equal to 53%
and 47%, respectively, of future costs associated with environmental investigation and remediation activities at the York facility
(Response Costs). The trust administers the payment of the Response Costs incurred at the York facility as covered by the
Agreement.
In February 2002, the Company was advised by the EPA that it considers some of the Company’s remediation activities at
the York facility to be subject to the EPA’s corrective action program under the Resource Conservation and Recovery Act
(RCRA) and offered the Company the option of addressing corrective action under a RCRA facility lead agreement. In July
2005, the York facility was designated as the first site in Pennsylvania to be addressed under the “One Cleanup Program.” The
program provides a more streamlined and efficient oversight of voluntary remediation by both PADEP and EPA and will be
carried out consistent with the Agreement with the Navy. As a result, the RCRA facility lead agreement has been superseded.
The Company estimates that its share of the future Response Costs at the York facility will be approximately $3.9 million
and has established a reserve for this amount which is included in accrued liabilities in the Condensed Consolidated Balance
Sheets. As noted above, the RI/FS is still underway and given the uncertainty that exists concerning the nature and scope of
additional environmental investigation and remediation that may ultimately be required under the RI/FS or otherwise at the
York facility, the Company is unable to make a reasonable estimate of those additional costs, if any, that may result.
The estimate of the Company’s future Response Costs that will be incurred at the York facility is based on reports of
independent environmental consultants retained by the Company, the actual costs incurred to date and the estimated costs to
complete the necessary investigation and remediation activities. Response Costs are expected to be paid primarily over a period
of several years ending in 2017 although certain Response Costs may continue for some time beyond 2017.
Product Liability Matters:
Additionally, the Company is involved in product liability suits related to the operation of its business. The Company
accrues for claim exposures that are probable of occurrence and can be reasonably estimated. The Company also maintains
insurance coverage for product liability exposures. The Company believes that its accruals and insurance coverage are adequate
and that product liability suits will not have a material adverse effect on the Company’s consolidated financial statements.
17. Capital Stock
Common Stock:
The Company is authorized to issue 800,000,000 shares of common stock of $0.01 par value. There were 220.0 million
and 226.1 million common shares outstanding as of December 31, 2013 and 2012, respectively.
During 2013, the Company repurchased 8.2 million shares of its common stock at a weighted-average price of $59. This
includes shares of common stock that were repurchased from employees that surrendered stock to satisfy withholding taxes in
connection with the vesting of restricted stock awards. The remaining repurchases were made pursuant to the following
authorizations (in millions of shares):
Shares Repurchased Authorization Remaining
at December 31, 2013
Board of Directors’ Authorization 2013 2012 2011
1997 Authorization — 4.3 6.2 1.8
2007 Authorization 7.7 2.2 — 6.8
Total 7.7 6.5 6.2 8.6