---

Caterpillar Emphasizes Engines Have Been in Full Compliance

22 October 1998

Caterpillar Emphasizes Engines Have Been in Full Compliance

    PEORIA, Ill., Oct. 22 -- Caterpillar, Inc.
confirms that it, along with other major diesel engine manufacturers, has been
engaged for an extended period in discussions with the EPA designed to produce
an agreement for the industry to accelerate ongoing programs to reduce
emissions from diesel engines.
    Caterpillar emphasizes strongly that it has not violated any laws and that
its engines have at all times been in full compliance with the provisions of
the Clean Air Act.  Nevertheless, in an effort to avoid protracted litigation
and related uncertainties, Caterpillar is working in full cooperation with the
EPA.
    Caterpillar hopes to finalize agreement with the EPA shortly.  The
contemplated agreement is in the best long-term interest of our customers, the
environment, Caterpillar and its shareholders.  In its entirety, the agreement
will not have a material financial impact on Caterpillar.