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Cummins Engine Chairman And CEO James A. Henderson to Retire

29 September 1999

Cummins Engine Chairman And CEO James A. Henderson to Retire; President And COO Theodore `Tim' Solso Named Successor

    COLUMBUS, Ind.--Sept. 29, 1999--Cummins Engine Co. Inc. today announced that after a career spanning over 35 years at Cummins, Chairman and Chief Executive Officer James A. (Jim) Henderson plans to retire at the end of the year. Henderson has held senior leadership positions at Cummins since 1977, when he was first appointed President and Chief Operating Officer at age 43. He has held the position of Chairman since 1995 and CEO since 1994.
    Upon the recommendation of Henderson, the board has named Company President and Chief Operating Officer Theodore (Tim) Solso, a 28-year Cummins veteran, to succeed Henderson as the fifth executive to lead the company in Cummins' history.
    "My decision to retire at the end of this year continues the Cummins tradition of orderly change," said Henderson. "I indicated when I became CEO in 1994 that I expected to remain in this role until my 65th birthday - an event that occurred in July. I have stayed a few months longer to ensure that Cummins' new product offerings were firmly launched and will be successful in the marketplace. In addition, as our most recent earnings results demonstrate, we are on a firm path to bring increased value to our shareholders. Tim Solso is highly capable and fully prepared to lead Cummins into the next century with the help of the aggressive and experienced executive team that we now have in place. I have complete confidence in them."
    J. Irwin Miller, Chairman of Cummins from 1951 to 1977, said, "I want to take this opportunity to recognize the enormous and unique contributions which Jim Henderson has made to Cummins. Jim brought this company's total operations into the 21st Century and got it done many years before most corporations realized the necessity. The difficulties he successfully faced in this undertaking can scarcely be exaggerated. We owe him a debt of gratitude."
    Miller continued, "Jim is followed now by the ablest young man of his generation I know. Tim Solso holds firmly to the central values which have characterized the company for 80 years, and he understands that he must interpret those values according to the constantly changing needs of the new century."
    Franklin A. Thomas, speaking on behalf of Cummins' outside directors, said "Cummins has greatly benefited by Jim's leadership. He has brought a renewed focus on shareholder value during his tenure as chief executive, and has also led the most aggressive investment in Cummins' history to modernize and expand the company's product line. As President and COO, Tim Solso has played a critical role in both of these successful initiatives, and he enjoys the complete confidence of the board."
    Thomas continued, "Jim's greatest legacy from his years of leadership at Cummins is the involvement of Cummins' people in continuous improvement for customers. In the 1970s, Jim led the way in introducing team-based work systems to U.S. industry. Faced with competition from Japan in the 1980s, Jim initiated a Total Quality Systems approach, Customer Led Quality, which has achieved substantial gains in both quality and productivity."
    Commenting on his successor, Henderson said, "No one is better prepared than Tim Solso to lead this company into the future. Tim has been involved in almost every aspect of Cummins' business, and for the past five years has been responsible for all day-to-day operations of the company. He has also been instrumental in growing and maintaining our relationships with key customers worldwide."
    Tim Solso said, "I appreciate the support and confidence of the board of directors, of Jim Henderson, and of the very strong management team we have built. I have worked closely with Jim for more than 25 years, particularly during the last ten, which has provided me not only with the opportunity to learn and to grow, but to benefit from Jim's leadership. Cummins and its shareholders, partners, customers and employees have all gained from Jim's vision and guidance."
    Continued Solso, "Cummins is well-positioned for success. Under Jim's leadership, we transformed our entire engine product line, incorporating state-of-the-art electronics and emissions control. We acquired Nelson Industries, making our filtration business a global leader. With Jim's guidance, we took tough actions to improve our profitability, while ensuring that our employees were treated fairly. Like Cummins' leaders before him, Jim's ability to take bold action - sometimes in the face of opposition - means that Cummins now has the best products, alliances, and customers in the industry."
    Continued Solso, "Our focus as we look to the future will remain the same - we must achieve our financial targets and deliver shareholder value while serving our customers beyond their expectations. We remain firmly committed to our financial goals: achieving 25 percent gross margin and holding selling, administrative and research and engineering expenses to 16 percent of sales, which will result in earnings of 9 percent before interest and taxes in years in which our markets are growing."
    "In a world of global competition, increasingly stringent emissions requirements, and a demand for quality, the opportunities for Cummins have never been better."

    Theodore M. (Tim) Solso

    Tim Solso, 52, joined Cummins in 1971 as Assistant to the Vice President -- Personnel. After assignments in the areas of employment, development, and training, which included a role as the Director of Administration for CAEMI Cummins in Brazil, he became Executive Director -- Personnel in 1977. In 1980, he moved to Cummins' United Kingdom subsidiary, Holset Engineering Company, Ltd., as Vice President and Managing Director.
    Solso returned to the United States in 1984, assuming the role of Vice President -- Special Engine Markets. In 1986, he was named Vice President -- Marketing. He moved to Vice President and General Manager of the Engine Business in 1988, and four years later, was named Executive Vice President -- Operations. He has served as President since 1995 and Chief Operating Officer since 1994.
    Raised in Lake Oswego, Oregon, Solso received a B.A. degree from DePauw University in 1969 and his M.B.A. from Harvard University in 1971.
    Solso also serves on the boards of Ashland, Inc., Cyprus Amax Minerals, Inc., Irwin Financial Corporation, and the Cummins Engine Foundation. He is a member of the Board of Trustees of DePauw University, the Manufacturer's Alliance, and serves on the Board of Advisors for the University of Michigan School of Business. He is a past board member of Amoco Corporation and the Heritage Fund of Bartholomew County (IN). In 1998, Solso served as the Chairman of the United Way campaign in Bartholomew County (IN). He also serves on the board of Otter Creek Golf Course in Columbus, IN.
    Solso and his wife, Denny, have three children.

    James A. Henderson

    Jim Henderson, 65, joined Cummins in 1964 and was elected Chairman of the Board of Cummins Engine Company in 1995 after serving as Chief Executive Officer since 1994 and its President since 1977.
    Born in Culver, Ind., he graduated cum laude from Culver Military Academy in 1952, and received his A.B. degree from Princeton University in public and international affairs in 1956. From then until 1961 he served in the U.S. Navy as a lieutenant, three years on a destroyer and two years on the faculty of the U.S. Naval Academy at Annapolis.
    He received his M.B.A. from Harvard Business School in 1962, graduating with high distinction. While there, he was president of the student body. Upon graduation, Mr. Henderson became a faculty research assistant for a year and co-authored a textbook on collective bargaining.
    He joined Cummins in 1964 as Assistant to the Chairman and had served in this capacity for one year when he was named Vice President of Management Development. After serving as Vice President - Personnel and Vice President - Operations, he was elected Executive Vice President in 1971. In 1975, his duties were expanded to include those of Chief Operating Officer. He was named President in 1977. In 1994, he was named CEO, and became Chairman of the Board in 1995.
    Henderson serves as a Director of Ameritech Corporation, International Paper Company, Landmark Communications, Inc., Ryerson Tull, Inc., Rohm and Haas Company, and is a member of the Komatsu International Advisory Board. He is also President of the Board of Trustees, The Culver Educational Foundation, a member of the Policy Committee of the Business Roundtable, a member of The Business Council, and a member of The Indiana Academy. Henderson also served as Chairman of the Executive Committee, Princeton University Board of Trustees, from 1986-1992.
    Cummins, headquartered in Columbus, Ind., is the world's largest producer of diesel engines above 200 horsepower. The company provides products for customers in its key markets: engines, including automotive and industrial, power generation, and filtration. In 1998, Cummins reported record sales of $6.3 billion and employed 28,300 persons worldwide. Press releases by fax may be requested by calling News on Demand (toll free) at 888-329-2305. Cummins' home page on the Internet can be found at http://www.cummins.com.