THIS DOCUMENT, DATED MARCH 6, 2002, CONSTITUTES PART OF A
PROSPECTUS COVERING SECURITIES THAT HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933.

THE MANITOWOC COMPANY, INC. DEFERRED COMPENSATION PLAN

As Amended Effective as of March 31, 2002

SUMMARY PLAN INFORMATION

Purpose, Duration And Amendment

The Manitowoc Company, Inc. (the "Company") sponsors The Manitowoc Company, Inc.
Deferred Compensation Plan (the "Plan"). The purpose of the Plan is to promote
the best interests of the Company and its subsidiaries and affiliates and the
stockholders of the Company by (1) attracting and retaining well-qualified
persons for service as nonemployee directors of the Company and promoting
identity of interest between directors and stockholders of the Company; and (2)
attracting and retaining key management employees possessing a strong interest
in the successful operation of the Company and its subsidiaries and affiliates
(collectively referred to as the "Employer") and encouraging their continued
loyalty, service, and counsel to the Employer.

There is no time limit on the Plan's duration. The Board of Directors of the
Company (the "Board") may, at any time, amend or terminate the Plan without the
consent of the participants or beneficiaries, provided, that no amendment or
termination may reduce any account balance accrued on behalf of a participant
based on deferrals already made, or divest any participant of rights to which he
would have been entitled if the Plan had been terminated immediately prior to
the effective date of the amendment. The Board also may cause all accounts to be
distributed in the event of Plan termination, provided all participants and
beneficiaries are treated in a uniform and nondiscriminatory manner in such
event.

In addition, no amendment to the Plan may become effective until stockholder
approval is obtained if the amendment (i) except as expressly provided in the
Plan, materially increases the aggregate number of shares of Manitowoc Stock
that may be allocated in a Plan Year, which is the same as the fiscal year of
the Company, (ii) materially increases the benefits accruing to participants
under the Plan or (iii) materially modifies the eligibility requirements for
participation in the Plan.

Plan Administration

A committee of the Board composed of not less than 2 directors who qualify as
"nonemployee directors" within the meaning of Rule 16b-3 of the Securities
Exchange Act of 1934 administers and interprets the Plan (the "Administrator").
The Company's Human Resources Department supervises preparation of compensation
deferral agreements and forms and assists the Administrator in all aspects of
Plan administration. The Administrator may be contacted for more information at:

The Manitowoc Company, Inc.
500 South 16th Street
P. O. Box 66
Manitowoc, WI 54221-0066
Attention: Debra J. Casper

Telephone: (920) 683-8131

Transactions under the Plan are intended to comply with all applicable
conditions of Rule 16b-3 under Section 16 of the Securities Exchange Act of 1934
(the "Exchange Act"), or its successor. The Plan is to be interpreted so that
transactions under the Plan will be exempt from Section 16 of the Exchange Act
pursuant to regulations and interpretations issued from time to time by the
Securities and Exchange Commission.

Eligibility

All continuing nonemployee directors of the Company and continuing key employees
of an Employer remain eligible to participate as of the first day of any
subsequent Plan Year, provided their deferral agreements are completed in
advance.

All new nonemployee directors of the Company and new key employees of an
Employer shall be entitled to participate in the Plan as of the first day of the
month following the date of their proper execution of their initial compensation
deferral agreements, provided the execution of their compensation deferral
agreements is not more than 30 days after their initial eligibility date.
Thereafter, such persons are eligible to participate as of the first day of any
subsequent Plan Year so long as their deferral agreements are completed in
advance.

For this purpose, a key employee is an elected officer of the Company and any
other highly compensated employee of an Employer who has compensation in the
immediately preceding Plan Year that is equal to or greater than the indexed
amount described in Internal Revenue Code Section 414(q)(l)(B) in effect for
that Plan Year ($85,000 for 2001; $90,000 effective January 1, 2002, adjusted
for cost of living increases in subsequent years). This determination of
eligibility is generally made based on pay as of the last day of the immediately
preceding Plan Year, but, for newly hired employees who are in their first year
of employment, it is made on the basis of their current base rate of pay.

A participant has no further right to defer compensation under the Plan after
termination of service to an Employer as a nonemployee director, or after
termination of employment in the case of all other participants, or, if earlier,
upon receipt of written notice from the Administrator of revocation of an
employee's status as a key employee. Such revocations are effective only upon
the first day of the Plan Year following the date that the employee is provided
such written notice. If a participant terminates service with an Employer and
subsequently returns to service, the participant shall be treated as a new
employee (or director if applicable) for all Plan purposes.

Deferred Compensation Amounts

A nonemployee director participant may make a deferral election with respect to
all or part of the director's compensation, in increments of five percent (5 %).
A key employee participant may make a deferral election with respect to whole
percentages, in increments of one percent (1 %), not to exceed forty percent
(40%) of regular pay for any Plan Year. There is no maximum deferral percentage
applicable to incentive bonuses. However, the maximum amount of compensation of
a key employee participant which may be considered for any Plan Year for
purposes of determining the Employer contribution described below is limited to
twenty-five percent (25%) of total pay for any Plan Year.

Compensation, for Plan purposes, means, for nonemployee director participants,
retainer fees paid for service as a Board member and for service on any
committee of the Board, including attendance fees and fees for serving as
committee chair. Compensation for key employees has the same meaning as under
the Company's 401(k) Retirement Plan, without regard to the dollar limits
applied to that definition by Internal Revenue Code Section 401(a)(17) ($200,000
effective January 1, 2002, as adjusted for cost of living increases in
subsequent years).

Credits to deferred compensation accounts are to be made within a reasonable
time (not to exceed 30 days) following the time that the deferred compensation,
but for the participant's deferral election, would otherwise have been paid or
made available to the participant. The Company will deduct payroll tax amounts
and amounts it may be required to withhold on the deferred compensation at the
time it is credited to a participant's account under any state, federal, or
local law for payroll or other taxes or charges, from the participant's
compensation which is not deferred, to the maximum extent possible.

A participant's deferral election remains in effect with respect to all future
Plan Years until a modified agreement or revocation is effective. A participant
may modify the deferral amount specified in the participant's initial agreement
(including reduction or revocation of any deferral election) by completing and
executing a modified agreement and submitting it to the Administrator.

A modified deferral agreement will generally be effective with respect to
compensation accruing on and after the first day of the Plan Year beginning
after the date of the modified agreement. However, a reduction or revocation of
a deferral election may be effective on the first day of the month after the
election to reduce or revoke is made if the election is made due to hardship.
Hardship means an unanticipated event or events beyond the participant's control
that would result in severe financial hardship to the participant if the
reduction or revocation is not permitted.

If a participant is permitted to reduce or revoke the participant's deferrals on
any date other than the first day of a Plan Year, then the participant must
forego receiving any Employer contributions under the Plan for the year in which
the reduction or revocation occurred.

A participant must designate a beneficiary at the time the participant completes
an initial compensation deferral agreement. The participant may at any time
modify this beneficiary designation by completing and executing a revised
beneficiary designation form and submitting it to the Administrator.

A participant must also provide initial investment directions with respect to
the participant's Program B account balance (described below) and must maintain
on file with the Administrator separate distribution elections for the
participant's account balances in both Program A and Program B.

The accounts of participants in the Plan are immediately vested and
nonforfeitable.

Investment Of Deferred Amounts

Effective March 31, 2002, the Plan has two separate investment programs: Program
A and Program B.

Program A is deemed to be solely invested in Manitowoc Stock and any dividends
paid on shares of Manitowoc Stock deemed to be held under Program A shall be
deemed to be reinvested in Manitowoc Stock under Program A, in accordance with
rules and procedures established by the Administrator. There are no other
investment options in Program A. The funds in Program A cannot be transferred at
any time to Program B. All distributions under the Plan from Program A must be
made in Manitowoc Stock. Any Manitowoc Stock that may be held in trust pursuant
to the Plan in connection with Program A will be owned by a trust that is
completely separate from any trust that may hold assets in trust pursuant to the
Plan in connection with Program B (described in the next paragraph).

Program B offers a variety of mutual funds as investment options. Manitowoc
Stock is not an investment option in Program B. The funds in Program B cannot be
transferred at any time to Program A. All distributions from Program B must be
made in cash. The assets of Program B that may be held in trust pursuant to the
Plan in connection with Program B will be owned by a trust that is completely
separate from any trust that may hold assets in trust pursuant to the Plan in
connection with Program A (described in the preceding paragraph).

Prior to March 31, 2002, in accordance with Administrator procedures, each
participant shall designate the portion of the participant's existing account
balance in the Plan is to be credited to Program A (Manitowoc Stock Program) or
Program B (Diversified Investment Program) as of the close of March 2002. This
designation of existing balances between these two Programs is irrevocable.

In addition, each participant shall regularly advise the Administrator, in
accordance with Administrator rules, the portion of any new deferred amounts
that is to be credited to Program A (Manitowoc Stock Program) and Program B
(Diversified Investment Program). This designation of newly credited amounts
between these two Programs is also irrevocable.

In addition, each participant who is a key employee shall also designate the
amount of any Employer contributions, made on the key employee's behalf by the
Employer, are to be credited to Program A and to Program B.

The Administrator may, in its sole discretion, establish maximum amounts that
may be directed to Program A (Manitowoc Stock Program) in accordance with rules
applied uniformly to similarly situated participants.

Each participant with funds directed to Program B (Diversified Investment
Program) shall also provide investment directions regarding the participant's
accounts in that Program.

The Plan's investment options are summarized at the end of this material. Each
of the investment options is subject to investment risk. Program A is limited to
investment in Manitowoc Stock. This investment is not diversified and may be
subject to a higher level and/or different kind of investment risk than the
diversified investment options offered in Program B. There can be no assurance
that any investment option will achieve its stated objective or that an
investment in any option will not result in a loss. The Employer cannot and does
not guarantee the value of any accounts or the performance of any of the
investment options, and has no obligation to make up any losses suffered by
participants.

The Administrator may change the investment characteristics of the Plan, with
appropriate advance notice to participants. This includes eliminating or adding
investment options, or changing investment managers. Timely notice of any
changes will be provided to all investors in any investment option that is
affected by Administrator actions.

Any Manitowoc Stock purchased for any Plan purpose may be purchased by the
Company or trustee in any manner that the Company or trustee may determine from
time to time, including purchases from the Company, in the open market and from
private sources.

Subaccounts will be maintained by the Plan recordkeeper for the interest of each
participant in the investment options made available under Program B(Diversified
Investment Program). Subaccounts under Program B are deemed to be fully invested
at all times in the investment option associated with the subaccount. The
recordkeeper will separately account for credited amounts as units of the
designated investment option having the value attributable to units of the
investment option at all times, taking into account reinvestment of all
dividends pertaining to the investment, but without adjustment for any income
tax consequences attributable to actual Employer ownership of such investments.

A participant will provide, in accordance with Administrator rules, investment
directions in connection with the participant's Program B account. Investment
directions are generally effective on the first day of the following month in
which they are provided to the Administrator in accordance with Administrator
rules. Participants (or beneficiaries upon the death of the participant)
generally may transfer funds from one Program B subaccount to another subaccount
in Program B. A minimum transfer percentage may be set by the Administrator.

Certain additional rules apply to persons who also are subject to Section 16 of
the Exchange Act (generally referred to as "insiders"). Shares of Manitowoc
deemed to be held for an insider may be "withheld" from an insider's
distributions from Program A to satisfy federal withholding tax requirements. If
the distribution from Program A is in connection with death, disability,
retirement, or termination of employment, the withholding election must be
approved in advance by the Administrator. If the distribution from Program A is
for any other reason, the withholding election must be made at least 6 months
after the most recent election directing the deposit of funds into Program A
(Manitowoc Stock Program) of the Plan or into a Manitowoc Stock fund under any
other plan of the Company, including the 401(k) Retirement Plan.

Amounts equal to participant and Employer contributions to the Plan may, at the
election of the Employer, be transferred to one or more trust funds established
by the Company to assist it in meeting the obligations created under the Plan.
Under no circumstances will the same trust be used in connection with Program A
and Program B, effective on and after March 31, 2002.

The type of trust that would be used limits the ability of the Company to use
the monies deposited in the trust. The trust holds and distributes the money
according to the Plan document. The funds in the trusts are, however, always
subject to the claims of the general creditors of the Company if a forced
liquidation or bankruptcy occurs. This is a different type of trust than the
trust used for the Company's 401(k) Retirement Plan, which is not subject to
such claims.

In short, this means that participants are not guaranteed the return of their
deferrals. This risk is necessary to avoid the IRS claiming constructive receipt
resulting in current taxation to the participant of the amount of the
participant's deferrals or any Employer contributions provided under the Plan.
This "credit risk" is a result of the Plan not being a tax-qualified plan.
Nonqualified status is what allows the Plan to allow deferrals that exceed the
limits applicable to qualified plans.

Associated Trust Company, N. A., Manitowoc, is the trustee for the Plan's
trusts. Associated Trust Company also is the current trustee for the 401(k)
Retirement Plan.

Distributions

Separate distribution elections may be made by a participant for the
participant's account in Program A and Program B. If a participant has just one
distribution election under the Plan it will be applied to the participant's
accounts in both Program A and Program B. Maintaining current distribution
elections on file with the Administrator is the sole responsibility of the
participant. An insider's change of any distribution election initially filed a
the commencement of participation, and any changes made thereafter, must
specifically be approved by the Administrator in advance of their going into
effect.

Each distribution election must designate in advance the distribution date
applicable to the participant's account governed by the election, and whether
distributions are to be made in a lump sum, in installments, or in a combination
thereof. Initial distribution elections are to be made at the time the
participant completes the participant's initial compensation deferral agreement.

A participant may designate as a distribution date the first day of the calendar
month following the date of the participant's death; the first day of the
calendar month following the date of the participant's disability (as defined in
the Plan); the first day of the calendar month following the date of termination
of the participant's service as a member of the Board if the participant is a
nonemployee director; or, if the participant is an employee of an Employer, the
first day of the calendar month following the date of termination of the
participant's employment with the Employer; the first day of any calendar month
specified by the participant; or the earliest to occur of these dates.

A participant shall direct whether distributions from the account are to be made
in a lump sum, in no more than 180 monthly, 60 quarterly, or 15 annual
installments. Each installment is determined by dividing the account, or
subaccount, balance by the number of remaining payments.

All distributions from the Manitowoc Stock subaccount shall be made in shares of
Manitowoc Stock, except that fractional shares may be paid in cash. All
distributions from other investment funds will be made in cash. Any brokerage
commissions or transaction fees applicable to the sale of shares of Manitowoc
Stock distributed from the Plan are the responsibility of the recipient of the
distribution.

A participant may generally modify an election of a distribution date and form
of distribution by completing and executing a modified distribution election
form and filing it with the Administrator. Modified distribution elections must
be filed with the Administrator not less than 12 months before the modification
can be permitted to be effective. Modifications by insiders must be approved in
advance by the Administrator.

Special rules permit, with approval of the Board, extraordinary distributions of
part or all of a participant's account due to hardship, defined as an
unanticipated event beyond the control of the participant that would result in
severe financial hardship to the participant unless the extraordinary
distribution is permitted.

The Administrator may adopt any additional rules and modify existing rules and
procedures, as necessary, to assure compliance with the insider trading
liability rules under Section 16 of the Exchange Act, as in effect from time to
time.

Employer Contributions

The Employer shall credit to the accounts of key employee participants an
Employer contribution equal to the key employee's deferred amount for a Plan
Year (not in excess of 25% of pay) multiplied by the rate, determined as a
percentage of eligible compensation, of fixed and variable profit sharing
contributions plus one percent (1%), that the participant has received from the
Employer for the Plan Year under the 401(k) Retirement Plan.

The Employer contribution shall be credited to the account of the eligible
participant (in Program A or Program B, as elected by the participant) within a
reasonable time (not to exceed thirty (30) days) following the time the Employer
deposits its contributions to the 401(k) Retirement Plan.

Tax Effects

Of Plan Participation

The Plan is intended to be a nonqualified plan of deferred compensation for a
select group of management or highly compensated employees. Compensation that is
deferred under the Plan, and the earnings deemed to accrue on deferred amounts,
are not included in adjusted gross income of participants or beneficiaries until
distributions are made pursuant to the Plan. Distributions under the Plan will
be taxable as ordinary income in the year of payment and will be considered to
be "wages" subject to withholding when actually or constructively received by an
employee. Payments made to a beneficiary in the event of the death of a
participant are "income in respect of a decedent" and taxed as they would have
been to the employee.

Generally, the amounts deferred under a nonqualified deferred compensation plan
of an employer covered by FICA (Federal Insurance Contributions Act) are "wages"
subject to social security taxes at the later of when the services are performed
or when the employee's right to such amounts are no longer subject to a
substantial risk of forfeiture. Participants are fully vested in their deferred
compensation accounts, immediately, under the Plan, so that certain payroll
taxes may be due in the year of deferral as to a portion of the compensation
being deferred.

Nonemployee directors who defer receipt of their fees for services performed
must include such fees in net earnings for self-employment tax purposes when the
deferred fees are actually or constructively received.

The Plan is not qualified under Section 401(a) of the Internal Revenue Code.
Plan distributions may not be "rolled over" to successor plans on a tax-deferred
basis and there are no special income averaging or lump sum distribution rules
applicable.

The Employer will receive a tax deduction in the amount of compensation paid as
benefits under the Plan, in the year in which the amounts are taken into income
by the recipient of the payment.

Statements Of Account

The Administrator will provide to each participant, not less than semiannually,
a statement with respect to each of the participant's accounts in such form as
the Administrator shall determine to be appropriate, setting forth credited
amounts added during the reporting period, any units of each Program B
investment option attributable to each subaccount and their current value,
amounts distributed from each account since the last report, the current balance
to the credit of such participant in each account, and other appropriate
information.

Expenses

The expenses incurred by Employers in the administration of the Plan and by the
Administrator in the performance of its duties, shall be paid by the Employers.

Assignment Of Interest

Participants shall have no rights as a stockholder pertaining to Manitowoc Stock
units credited to their Program A accounts. No Manitowoc Stock unit nor any
right or interest of a participant under the Plan in any Manitowoc Stock unit,
or any other right of a participant under the Plan, may be assigned, encumbered,
or transferred, except by will or the laws of descent and distribution. The
rights of a participant under the Plan are exercisable during the participant's
lifetime only by the participant or the participant's guardian or legal
representative.

Unfunded Plan

The right of the participant or the participant's beneficiary to receive a
distribution from the Plan shall be an unsecured claim against the general
assets of the Employer, and neither the participant nor any beneficiary shall
have any rights in or against any amount credited to his account or any other
specific assets of the Employer.

This Plan is unfunded and is maintained by the Employers primarily for the
purpose of providing deferred compensation for nonemployee directors of the
Company and a select group of management and highly compensated employees.
Nothing contained in the Plan and no action taken pursuant to its terms shall
create or be construed to create a trust of any kind, or a fiduciary
relationship between the Employers and any participant or beneficiary, or any
other person.

ERISA Statement

The Plan is a "top-hat" deferred compensation plan, subject only to part 1 of
Title I of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). It is required to comply only with ERISA's requirements regarding
reports to the Department of Labor.

Resale Restrictions

Any shares of Manitowoc Stock distributed to participants under the Plan shall
be subject to such stock transfer orders and other restrictions as the Company
may deem advisable under the rules, regulations and other requirements of the
Company, any stock exchange upon which Manitowoc Stock is then listed and any
applicable Federal, state or foreign securities law, and the Company may cause a
legend or legends to be put on any such certificates to make appropriate
reference to such restrictions.

SEC Disclosures

The Registration Statement of which this Prospectus constitutes a part became
effective on

June 30, 1993. Pursuant to this Registration Statement, 25,000 shares of The
Manitowoc Company, Inc. common stock and an indeterminate amount of interests in
the Plan were registered. A subsequent Registration Statement, dated September
11, 1996, registered an additional 150,000 shares of Manitowoc Stock and an
indeterminate amount of Plan interests. Shares of Manitowoc Stock may be
acquired pursuant to participant and Company deferrals under the Plan. The total
amount of Plan interests which have been registered include all participant and
Company contributions which may be invested in Manitowoc Stock.

Listing

The Manitowoc Company, Inc. common stock is currently authorized for trading on
the New York Stock Exchange.

Availability Of Additional Documents

The Company will provide without charge, upon written or oral request by any
person to whom this Prospectus is delivered, copies of the documents
incorporated by reference in Item 3 of Part II of Form S-8 Registration
Statements No. 333-11719 and 33-65316 of which this Prospectus constitutes a
part. Such documents are hereby incorporated by reference into this Prospectus.
The Company will also provide without charge, upon written or oral request by
any person to whom this Prospectus is delivered, copies of all other documents
required to be delivered pursuant to Rule 428(b) of Regulation C under the
Securities Act of 1933. Such requests should be directed to:

The Manitowoc Company, Inc.
500 South 16th Street
P. O. Box 66
Manitowoc, WI 54221-0066

Attention: Debra J. Casper

Telephone: 920-684-8131

In addition, the Securities and Exchange Commission maintains a web site that
contains reports, proxies, and information statements and other information
regarding registrants that file electronically with Commission. The web site
address is http://www.sec.gov.

PROGRAM A INVESTMENT INFORMATION

The Manitowoc Company, Inc. common stock, $.O1 par value, (Manitowoc Stock)

is the only designated investment for accounts under Program A of the Plan. In
the event of any merger, share exchange, reorganization, consolidation,
recapitalization, stock dividend, stock split, or other change in corporate
structure affecting Manitowoc Stock, appropriate adjustments will be made to the
units credited to this subaccount. Plan recordkeeping pertaining to Manitowoc
Stock shall be based on the fair market value of Manitowoc Stock. Fair market
value on any given date is defined for Plan purposes as the value determined by
the Administrator, at which shares were traded on that date in representative
trades reported in the principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on The New York Stock
Exchange on such date or, if no Manitowoc Stock is traded on such date, the most
recent date on which Manitowoc Stock was traded.

The price of Manitowoc Stock can fluctuate on a day-to-day or month-to-month
basis. This investment is best for individuals who invest for the long-term and
can tolerate short-term volatility. The choice to invest in Manitowoc Stock
limits the investment to one company and is more risky than a diversified
portfolio of many companies.

The following table shows the annualized rates of return on Manitowoc Stock
during the calendar years 1999, 2000, and 2001:

Investment Fund

2001 Annualized Rate of Return

1999 Annualized Rate of Return

19981 Annualized Rate of Return

Manitowoc Stock

8.1%

-13.6%

16.5%

 

 

PROGRAM B INVESTMENT INFORMATION

Money Market Fund

(Goldman Sachs Financial Prime Square Obligations Fund-Institutional Shares) is
managed by Goldman Sachs. It is designed to maximize current income, preserve
capital, and maintain liquidity. It invests primarily in securities issued by
the U. S. Government, its agencies or instrumentalities, and other high quality
U. S. money market securities.

Bond Fund

(Firstar Bond IMMDEX (Institutional)) is managed by Firstar Investment
Management and Research Company. Its objective is to add value to the Lehman
Brothers Government/Corporate Bond Index. It invests in fixed income securities,
including corporate bonds, U. S. government securities, and mortgage-related
securities, and money market instruments.

Balanced Fund

(The Vanguard Asset Allocation Fund) is managed by The Vanguard Group. Its
objective is to use quantitative techniques to take advantage of imbalances
between stocks, bonds, and cash. The stock portion of the fund is invested in
all of the S & P 500 Index stocks and the bond portion invests only in U. S.
Treasury Bonds.

S & P 500 Index Fund

(Vanguard Index 500) is managed by The Vanguard Group. Its objective is to hold
in the fund the same relative weighting of stocks that make up the S & P 500
Index and to achieve the same performance as the S & P 500 Index. The S & P 500
Index is made up of the 500 largest publicly traded stocks from the industrial,
utility, financial, and transportation sectors of the U. s. economy.

Equity Fund

(Nicholas Fund) is managed by Nicholas Funds. Its objective is the growth of
capital achieved through investing in medium sized companies. It invests in
common stocks issued primarily by mid- and large-cap companies.

Small Cap Stock Fund

(Berger Small Cap Value Fund Institutional) is managed by Berger Associates. It
seeks capital appreciation through an investment process that focuses on smaller
companies believed to be undervalued and undiscovered by the broader investment
community. It invests in companies selected from a universe of approximately
3,500 companies after applying numerous value screens and ranking the companies
based upon financial strength and their ability to rebound from current levels.

Mid Cap Growth Stock Fund

(Morgan Stanley Mid Cap Growth Institutional) is managed by Morgan Stanley. It
seeks capital appreciation through an investment process that focuses on smaller
to mid-sized companies believed to have sustainable growth that exceeds market
expectations. It invests in companies with a market capitalization between $500
million and $5 billion.

International Stock Fund

(Marshall International Stock Fund) is managed by BPI Global Asset Management,
LLC. Its objective is capital appreciation through investments in common stocks
of companies located outside the U. S. It seeks to invest in quality companies
with attractive returns on equity, shareholder oriented management, and a strong
capital structure.

The following table shows the annualized rates of return on each of the Program
B investment options during the calendar years 1999, 2000, and 2001:

Investment Fund

2001 Annualized Rate of Return

2000 Annualized Rate of Return

1999 Annualized Rate of Return

Money Market
Fund

4.0%

6.4%

5.1%

Bond Fund

6.8%

11.8%

-1.4%

Balanced Fund

-5.3%

4.9%

5.2%

S & P 500
Index Fund

-12.0%

-9.1%

21.1%

Equity Fund

-11.0%

-1.5%

1.7%

Small Cap
Stock Fund

20.4%

27.2%

14.7%

Mid Cap
Growth Stock
Fund

-29.8%

-7.4%

68.2%

International
Stock Fund

-22.9%

-16.8%

56.0%