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UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-Q/A(Amendment No. 1)

|(Mark One) |                                                                                        
|---------- | ---------------------------------------------------------------------------------------
|ý          | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 30, 2002

OR

|o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

FOR THE TRANSITION PERIOD FROM  TO

COMMISSION FILE NUMBER 0-13198

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MORTON INDUSTRIAL GROUP, INC.(Exact name of registrant as specified in its charter)

Georgia(State or other jurisdiction of
Incorporation or organization)

38-0811650(IRS Employer
Identification No.)


1021 W. Birchwood, Morton, Illinois 61550(Address of principal executive offices)

(309) 266-7176(Registrant's telephone number, including area code)

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Indicate
by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
    Yes ý    No o

|                                     |  | Outstanding as of
April 26, 2002
|------------------------------------ |  | --------------------------------
|Class A Common Stock, $.01 par value |  | 4,400,850                       
|Class B Common Stock, $.01 par value |  | 200,000                         

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MORTON INDUSTRIAL GROUP, INC.
List of Items Amended

Part IFinancial Information

|Item 1. |  | Financial Statements                                                                 
|------- |  | -------------------------------------------------------------------------------------
|        |  | Condensed Consolidated Statements of Operations                                      
|        |  | Condensed Consolidated Balance Sheets                                                
|        |  | Condensed Consolidated Statements of Cash Flows                                      
|        |  | Condensed Consolidated Statements of Stockholders' Equity (Deficit)                  
|        |  | Notes to Condensed Consolidated Financial Statements                                 
|Item 2. |  | Management's Discussion and Analysis of Financial Condition and Results of Operations
|Item 4. |  | Controls and Procedures (1)                                                          

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TEXT
OF AMENDMENT

Explanatory
Note:

As
previously described in Form 12b-25 filed on August 14, 2002, the registrant's Audit Committee planned to conduct a formal inquiry into accounting practices at a
subsidiary of the registrant. The Audit Committee subsequently retained independent counsel and auditors to conduct the inquiry. During the course of the inquiry, the registrant determined certain
accounting errors had occurred at the subsidiary and that it is appropriate to restate the financial results for the year ended December 31, 2001 and the quarter ended March 30, 2002. On
the same date of the filing of this Form 10-Q/A, the registrant is filing a Form 10-K/A for the year ended December 31, 2001, and its Form 10-Q
for the quarter ended June 29, 2002, to which reference is made for additional information and developments after March 30, 2002.

The
impact on the quarter ended March 30, 2002, related to the matter described above, is to decrease net sales $63,000 increase cost of sales $316,000 and increase administrative
expenses $34,000this results in a combined decrease in operating income of $413,000 from the results previously reported.

Additionally,
based on a review of its accounting policies, the Company has determined that its interest rate swaps did not qualify for hedge accounting. Related to accounting for the
Company's interest rate swap instruments, a restatement has been made that had the effect of increasing other income (expense) $220,000 and ($235,000) for the three months ended March 30, 2002 and
March 31, 2001, respectively.

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PART IFINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS

MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

For the Three Months Ended March 30, 2002 and March 31, 2001

(Dollars in thousands, except per share data)

(Unaudited)

|                                                                   |                         | Three Months Ended                                   |       
|------------------------------------------------------------------ | ----------------------- | ---------------------------------------------------- | ------
|
|
|Net sales                                                          |                         | $                                                    | 54,347
|Cost of sales                                                      |                         |                                                      | 47,106
|                                                                   |                         |                                                      |       
|                                                                   |                         | Gross profit                                         |       
|                                                                   |                         |                                                      |       
|Operating expenses:                                                |                         |                                                      |       
|                                                                   | Selling expenses        |                                                      |       
|                                                                   | Administrative expenses |                                                      |       
|                                                                   |                         |                                                      |       
|                                                                   |                         | Total operating expenses                             |       
|                                                                   |                         |                                                      |       
|                                                                   |                         | Operating income                                     |       
|                                                                   |                         |                                                      |       
|Other income (expense):                                            |                         |                                                      |       
|                                                                   | Interest expense        |                                                      |       
|                                                                   | Other                   |                                                      |       
|                                                                   |                         |                                                      |       
|                                                                   |                         | Total other income (expense)                         |       
|                                                                   |                         |                                                      |       
|                                                                   |                         | Earnings (loss) before income taxes                  |       
|Income taxes                                                       |                         |                                                      |      
|                                                                   |                         |                                                      |       
|                                                                   |                         | Net earnings (loss)                                  |       
|Accretion of discount on preferred shares                          |                         |                                                      | (279  
|                                                                   |                         |                                                      |       
|                                                                   |                         | Net earnings (loss) available to common stockholders |       
|                                                                   |                         |                                                      |       
|Earnings (loss) available to common stockholders per sharebasic   |                         | $                                                    | (0.14 
|                                                                   |                         |                                                      |       
|Earnings (loss) available to common stockholders per sharediluted |                         | $                                                    | (0.14 
|                                                                   |                         |                                                      |       
|Weighted average number of common shares                           |                         |                                                      |       
|                                                                   | Basic                   |                                                      |       
|                                                                   |                         |                                                      |       
|                                                                   | Diluted                 |                                                      |       
|                                                                   |                         |                                                      |       

See
accompanying notes to condensed consolidated financial statements.

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MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

March 30, 2002 and December 31, 2001

(Dollars in thousands)

(Unaudited)

|                                                          |                                                                                                  | March 30, 2002 |                                     | December 31, 2001 |        
|--------------------------------------------------------- | ------------------------------------------------------------------------------------------------ | -------------- | ----------------------------------- | ----------------- | -------
|
|Assets                                                    |                                                                                                  |                |                                     |                   |        
|Current assets:                                           |                                                                                                  |                |                                     |                   |        
|                                                          | Trade accounts receivable, less allowance for doubtful
accounts of $296 in 2002 and $381 in 2001 |                | $                                   | 20,327            |        
|                                                          | Inventories                                                                                      |                |                                     | 22,214            |        
|                                                          | Prepaid expenses                                                                                 |                |                                     | 3,524             |        
|                                                          | Deferred income taxes                                                                            |                |                                     | 800               |        
|                                                          |                                                                                                  |                |                                     |                   |        
|                                                          |                                                                                                  |                | Total current assets                |                   |        
|                                                          |                                                                                                  |                |                                     |                   |        
|Property, plant, and equipment, net                       |                                                                                                  |                | 44,988                              |                   | 46,437 
|Intangible assets, at cost, less accumulated amortization |                                                                                                  |                | 11,162                              |                   | 10,353 
|Deferred income taxes                                     |                                                                                                  |                | 4,148                               |                   | 4,148  
|Other assets                                              |                                                                                                  |                | 1,052                               |                   | 1,086  
|                                                          |                                                                                                  |                |                                     |                   |        
|                                                          |                                                                                                  | $              | 108,215                             |                   | 106,517
|                                                          |                                                                                                  |                |                                     |                   |        
|Liabilities and Stockholders' Equity (Deficit)            |                                                                                                  |                |                                     |                   |        
|Current liabilities:                                      |                                                                                                  |                |                                     |                   |        
|                                                          | Outstanding checks in excess of bank balance                                                     |                | $                                   | 2,533             |        
|                                                          | Current installments of long-term debt                                                           |                |                                     | 5,343             |        
|                                                          | Accounts payable                                                                                 |                |                                     | 29,527            |        
|                                                          | Accrued expenses                                                                                 |                |                                     | 7,202             |        
|                                                          |                                                                                                  |                |                                     |                   |        
|                                                          |                                                                                                  |                | Total current liabilities           |                   |        
|                                                          |                                                                                                  |                |                                     |                   |        
|Long-term debt, excluding current installments            |                                                                                                  |                | 76,731                              |                   | 73,870 
|Other liabilities                                         |                                                                                                  |                | 822                                 |                   | 280    
|                                                          |                                                                                                  |                |                                     |                   |        
|                                                          |                                                                                                  |                | Total liabilities                   |                   |        
|                                                          |                                                                                                  |                |                                     |                   |        
|Redeemable equity instruments                             |                                                                                                  |                | 7,622                               |                   | 7,343  
|                                                          |                                                                                                  |                |                                     |                   |        
|Stockholders equity (deficit):                            |                                                                                                  |                |                                     |                   |        
|                                                          | Class A common stock                                                                             |                |                                     | 44                |        
|                                                          | Class B common stock                                                                             |                |                                     | 2                 |        
|                                                          | Additional paid-in capital                                                                       |                |                                     | 20,883            |        
|                                                          | Retained deficit                                                                                 |                |                                     | (42,494           | )      
|                                                          |                                                                                                  |                |                                     |                   |        
|                                                          |                                                                                                  |                | Total stockholders equity (deficit) |                   |        
|                                                          |                                                                                                  |                |                                     |                   |        
|                                                          |                                                                                                  | $              | 108,215                             |                   | 106,517
|                                                          |                                                                                                  |                |                                     |                   |        

See
accompanying notes to condensed consolidated financial statements.

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MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders' Equity (Deficit)

For the Three Months Ended March 30, 2002

(Dollars in thousands)

(Unaudited)

|                                          |  | Class A
common stock |  | Class B
common stock |    |  |         |  |   |   | 
|----------------------------------------- |  | -------------------- |  | -------------------- | -- |  | ------- |  | - | - | 
|
|Balance, December 31, 2001                |  | 4,400,850            |  | $                    | 44 |  | 200,000 |  | $ | 2 | 
|Net loss (restated)                       |  |                     |  |                      |   |  |        |  |   |  | 
|Accretion of discount on preferred shares |  |                     |  |                      |   |  |        |  |   |  | 
|                                          |  |                      |  |                      |    |  |         |  |   |   | 
|Balance, March 30, 2002                   |  | 4,400,850            |  | $                    | 44 |  | 200,000 |  | $ | 2 | 
|                                          |  |                      |  |                      |    |  |         |  |   |   | 

See accompanying notes to condensed consolidated financial statements.

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MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

For the Three Months Ended March 30, 2002 and March 31, 2001

(Dollars in thousands)

(Unaudited)

|                                                    |                                                                | 2002                                                |      | 2001   |      
|--------------------------------------------------- | -------------------------------------------------------------- | --------------------------------------------------- | ---- | ------ | -----
|
|Net cash provided by (used in) operating activities |                                                                | $                                                   | (177 | )      | 3,859
|                                                    |                                                                |                                                     |      |        |      
|Cash flows from investing activities:               |                                                                |                                                     |      |        |      
|                                                    | Proceeds from sale of machinery and equipment                  |                                                     |      | 65     |      
|                                                    | Capital expenditures                                           |                                                     |      | (756   | )    
|                                                    |                                                                |                                                     |      |        |      
|                                                    |                                                                | Net cash used in investing activities               |      |        | (691 
|                                                    |                                                                |                                                     |      |        |      
|Cash flows from financing activities:               |                                                                |                                                     |      |        |      
|                                                    | Net repayments under revolving credit facility                 |                                                     |      | (2,641 | )    
|                                                    | Increase (decrease) in checks issued in excess of bank balance |                                                     |      | (1,512 | )    
|                                                    | Proceeds from issuance of long-term debt                       |                                                     |      | 6,003  |      
|                                                    | Increase in financing fees                                     |                                                     |      | (691   | )    
|                                                    | Principal payments on long-term debt and capital leases        |                                                     |      | (291   | )    
|                                                    |                                                                |                                                     |      |        |      
|                                                    |                                                                | Net cash provided by (used in) financing activities |      |        | 868  
|                                                    |                                                                |                                                     |      |        |      
|Net change in cash                                  |                                                                |                                                     |     |        |     
|Cash at beginning of period                         |                                                                |                                                     |     |        |     
|                                                    |                                                                |                                                     |      |        |      
|Cash at end of period                               |                                                                | $                                                   |     |        |     
|                                                    |                                                                |                                                     |      |        |      
|Supplemental disclosures of cash flow information:  |                                                                |                                                     |      |        |      
|                                                    | Cash paid during the period for:                               |                                                     |      |        |      
|                                                    |                                                                | Interest                                            |      | $      | 1,393
|                                                    |                                                                |                                                     |      |        |      
|                                                    |                                                                | Income taxes                                        |      | $      |     
|                                                    |                                                                |                                                     |      |        |      

See
accompanying notes to condensed consolidated financial statements.

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MORTON INDUSTRIAL GROUP, INC. AND SUBSIDIARIES        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS        For the Three Months Ended March 30, 2002 and March 31, 2001        (Dollars in thousands, except per share data)        (Unaudited)

(1)  Nature of Business.

The Company, operating through its subsidiaries, is a contract manufacturer and supplier of high-quality fabricated sheet metal and plastic components
and subassemblies for industrial, construction, agricultural, and recreational vehicle original equipment manufacturers located primarily in the Midwestern and Southeastern United States.

(2)  Interim Financial Data.

The Condensed Consolidated Financial Statements at March 30, 2002, and for the three months ended March 30, 2002 and March 31, 2001, are
unaudited and reflect all adjustments, consisting of normal recurring accruals and restatement adjustments which are, in the opinion of management, necessary for a fair presentation of the financial
position, operating results, and cash flows for the interim periods indicated. The Company's fiscal quarters end on a Saturday (nearest to a quarter end) except for the fourth quarter which ends on
December 31. For the quarter ended March 30, 2002, there were 63 shipping days, and for the quarter ended March 31, 2001, there were 64 shipping days. Results of
operations for the interim periods are not necessarily indicative of the results of operations for the full fiscal year. The condensed consolidated financial statements should be read in connection
with the consolidated financial statements and notes thereto, together with management's discussion and analysis of financial condition and results of operations of Morton Industrial
Group, Inc. contained in the Company's amended Annual Report on Form 10-K/A for the year ended December 31, 2001, as filed on November 4, 2002.

(3)  Restatement of Financial Statements

In
August, 2002, the Company announced that it had become aware of possible inappropriate accounting at one of its operating subsidiaries (Morton Custom Plastics, LLC). A formal inquiry
was conducted by the Audit Committee of the Company's Board of Directors, and while the inquiry was underway, the Company determined that certain accounting errors had occurred at the subsidiary. The
errors resulted primarily from the employment of inappropriate methods of recognizing revenues, the preparation of inaccurate estimates of inventory obsolescence, and failure to recognize costs in a
timely manner, all of which resulted in an overstatement of revenues and an understatement of cost of sales. The effect of the correction of the errors was to reduce previously reported net income by
$413 for the first quarter of 2002. Additionally, based on a review of its accounting policies, the Company has determined that its interest rate swaps did not qualify for hedge accounting. Related to
accounting for the Company's interest rate swap instruments, a restatement has been made that had the effect of increasing other income (expense) $220 and ($235) for the three months ended
March 30, 2002 and March 31, 2001, respectively. The condensed consolidated financial statements as of and for the three

1

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months ended March 30, 2002 and 2001 and notes thereto included in this report on Form 10-Q/A have been restated to include the effects of the corrections of these errors,
as follows:

|                                               |                                                                                | March 30, 2002
As previously
reported |   | March 30,
2002
Restated |  
|---------------------------------------------- | ------------------------------------------------------------------------------ | ------------------------------------- | - | ----------------------- | -
|Condensed Consolidated Balance Sheet           |                                                                                |                                       |   |                         |  
|                                               | Accounts Receivable                                                            |                                       | $ | 20,905                  |  
|                                               | Inventories                                                                    |                                       |   | 23,270                  |  
|                                               | Prepaid expenses                                                               |                                       |   | 3,537                   |  
|                                               | Total current assets                                                           |                                       |   | 48,512                  |  
|                                               | Property, plant and equipment, net                                             |                                       |   | 45,062                  |  
|                                               | Total assets                                                                   |                                       |   | 109,936                 |  
|                                               | Outstanding checks issued in excess of bank balance                            |                                       |   | 2,509                   |  
|                                               | Accounts payable                                                               |                                       |   | 29,877                  |  
|                                               | Accrued expenses                                                               |                                       |   | 7,205                   |  
|                                               | Total current liabilities                                                      |                                       |   | 44,934                  |  
|                                               | Total liabilities                                                              |                                       |   | 122,487                 |  
|                                               | Total redeemable preferred stock                                               |                                       |   | 7,622                   |  
|                                               | Total stockholders' equity (deficit)                                           |                                       |   | (20,173                 | )
|Condensed Consolidated Statement of Operations |                                                                                |                                       |   |                         |  
|                                               | Net sales                                                                      |                                       | $ | 54,410                  |  
|                                               | Cost of sales                                                                  |                                       |   | 46,790                  |  
|                                               | Gross profit                                                                   |                                       |   | 7,620                   |  
|                                               | Administrative expenses                                                        |                                       |   | 4,657                   |  
|                                               | Total operating expenses                                                       |                                       |   | 5,933                   |  
|                                               | Operating income                                                               |                                       |   | 1,687                   |  
|                                               | Interest expense                                                               |                                       |   | (1,853                  | )
|                                               | Total other income (expense)                                                   |                                       |   | 17                      |  
|                                               | Earnings (loss) before income taxes and cumulative effect of
accounting change |                                       |   | (149                    | )
|                                               | Net earnings (loss)                                                            |                                       |   | (428                    | )
|                                               | Loss available to common stockholders per sharebasic                          |                                       |   | (0.09                   | )
|                                               | Loss available to common stockholders per sharediluted                        |                                       |   | (0.09                   | )
|Condensed Consolidated Statement of Cash Flows |                                                                                |                                       |   |                         |  
|                                               | Cash used in operating activities                                              |                                       | $ | (128                    | )
|                                               | Cash used in investing activities                                              |                                       |   | (740                    | )
|                                               | Cash provided by financing activities                                          |                                       |   | 868                     |  

|                                               |                                                         | March 31, 2001
As previously
reported |        | March 31,
2001
Restated |       
|---------------------------------------------- | ------------------------------------------------------- | ------------------------------------- | ------ | ----------------------- | ------
|Condensed Consolidated Statement of Operations |                                                         |                                       |        |                         |       
|                                               | Other income (expense)                                  |                                       | 2      |                         | (233  
|                                               | Total other income (expense)                            |                                       | (2,562 | )                       | (2,797
|                                               | Net earnings (loss)                                     |                                       | 34     |                         | (201  
|                                               | Loss available to common stockholders per sharebasic   |                                       | (0.04  | )                       | (0.10 
|                                               | Loss available to common stockholders per sharediluted |                                       | (0.04  | )                       | (0.10 

2

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(4)  Inventory.

The Company's inventory, in thousands of dollars, as of March 30, 2002, and December 31, 2001, is summarized as follows:

March 30, 2002

December 31, 2001(Restated)Raw materials, purchased parts and manufactured components

$
10,800

$
9,273Work-in-process


3,848


4,807Finished goods


7,566


7,821$
22,214

$
21,901


(5)  Earnings Per Share.

The following reflects the reconciliation of the numerators and denominators of the earnings per share and the earnings per share assuming dilution computations:

|                                                          |  | Quarter Ended March 30, 2002
(Restated) |      | Quarter Ended March 31, 2001
(Restated) |          
|--------------------------------------------------------- |  | --------------------------------------- | ---- | --------------------------------------- | ---------
|
|Basic earnings (loss) available to common shareholders    |  | $                                       | (621 | )                                       | 4,600,850
|Effect of dilutive securities, stock options and warrants |  |                                         |     |                                         |         
|                                                          |  |                                         |      |                                         |          
|Diluted earnings (loss) available to common shareholders  |  | $                                       | (621 | )                                       | 4,600,850
|                                                          |  |                                         |      |                                         |          

At
both March 30, 2002 and March 31, 2001, 307,504 options and warrants were excluded from the computation of diluted earnings per share due to their anti-dilutive effect.

(6)  Segment Reporting.

Prior to 2001, the Company presented two reportable segments, contract metal fabrication and contract plastic fabrication. The contract metal fabrication segment
provides full service fabrication of parts and sub-assemblies for the industrial, construction, agricultural and recreational vehicle equipment industry. The contract plastic fabrication
segment provides full-service vacuum formed and injected-molded parts and sub-assemblies for the construction, agricultural and industrial equipment industry.

Due
to the need to closely monitor liquidity and compliance with debt covenants, the Company has changed its internal financial reports. Accordingly, effective December 31, 2001,
the Company is
presenting segment data based upon the results of operations by applicable credit facility. The Company's two separate credit facilities are described in more detail in these footnotes and in the

3

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Liquidity and Capital Resources section of Management's Discussion and Analysis of Financial Condition and Results of Operations.

The
following segment data is for the quarters ended March 30, 2002 and March 31, 2001:

|                                        |  | Harris Trust &
Savings Bank
Credit Facility |        | General Electric
Capital Corp.
Credit Facility |   | Total 
|--------------------------------------- |  | ------------------------------------------- | ------ | ---------------------------------------------- | - | ------
|Quarter Ended March 30, 2002 (Restated) |  |                                             |        |                                                |   |       
|Revenues from external customers        |  | $                                           | 36,345 |                                                | $ | 18,002
|Segment operating income (loss)         |  |                                             | 1,803  |                                                |   | (529  
|Interest expense                        |  |                                             | 1,313  |                                                |   | 540   
|Quarter Ended March 31, 2001            |  |                                             |        |                                                |   |       
|Revenues from external customers        |  | $                                           | 49,726 |                                                | $ | 24,678
|Segment operating income                |  |                                             | 1,972  |                                                |   | 624   
|Interest expense                        |  |                                             | 1,820  |                                                |   | 744   

(7)  Debt.

The Company has two separate credit facilities. One facility is with Harris Trust and Savings Bank, as Agent (Harris). This credit facility finances the Company's
corporate operations, as well as its contract metal fabrication operations in Illinois, North Carolina and South Carolina and its contract plastics fabrication operations in Iowa. The second facility
is with General Electric Capital Corporation (GECC). This credit facility finances the Company's contract plastic fabrication operations in North Carolina, South Carolina and Kentucky. The two credit
facilities are separately secured by the assets of the operations they support. Harris has no recourse against the assets secured by GECC; neither does GECC have recourse against the assets secured by
Harris.

The
debt agreements related to these credit facilities contain restrictions on capital expenditures, incurring additional debt or liens, making investments, mergers and acquisitions,
selling assets or making payments such as dividends or stock repurchases, as well as containing various financial covenants.

The Harris Trust and Savings Bank Credit Facility

In February 2002, the Company entered into an amended and restated secured revolving credit facility with the Harris syndicate. The revolving credit
agreement permits the Company to borrow up to a maximum of $21,000. The agreement requires payment of a quarterly commitment fee of .50% per annum of the average daily unused portion of the revolving
credit facility. Interest is due monthly and is based on LIBOR plus 4.0% (effective rate of 6.25% at March 30, 2002). The Company, alternatively, could select a domestic interest rate. The
amount available under the revolving credit facility is limited to 85% of qualified accounts receivable, 50% of eligible inventory, plus $2,500 of other assets. The revolving credit agreement expires
July 1, 2003. At March 30, 2002, the Company had $17,400 outstanding and $1,547 available under its Harris revolving credit facility.

4

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In
February 2002, the Company entered into an amended and restated secured term loan arrangement with the Harris syndicate for a term loan of $32,965. The term loan under this
financing arrangement is amortized monthly with principal payments ranging from $235 to $500 and the balance of $24,930 is due July 1, 2003. Interest is due monthly and is based upon LIBOR plus
4.0% (effective rate of 6.25% at March 30, 2002). The Company, alternatively, could select a domestic interest rate. The agreement is secured by a first lien on all of the Company's accounts
receivable, inventory, equipment and various other assets, other than the assets of Morton Custom Plastics LLC. The Company intends to obtain additional loans or funding support from other sources by
the end of the term of this arrangement, which may not be available on acceptable terms and conditions. Failure to do so could have a material adverse effect on the operations.

The
new Harris revolving credit facility and terms loans replaced existing credit facilities and did not provide additional availability. However, the repayment and fee terms were
modified, and the short-term principal payments and fees were reduced.

In
connection with the Harris loans, we have granted the lender a first lien on all of the Company's accounts receivable, inventory, equipment and various other assets, except for the
assets of Morton Custom Plastics, LLC.

The General Electric Capital Corporation Credit Facility

In March 2002, Morton Custom Plastics LLC entered into an amended and restated revolving credit facility and an amended and restated senior credit facility
with GECC.

The
new GECC revolving credit facility allows for borrowings up to a maximum of $10,000. Of the amount available under the revolver, $1,000 is held back as reserve for discretionary use
approved by the lender. The Company also incurs a fee based upon the unused revolving credit facility. The amount available under the revolving credit facility is generally limited to 85% of qualified
accounts receivable and 60% of eligible inventory. The revolving credit agreement expires August 30, 2006. At March 30, 2002, the Company had $8,761 outstanding or committed and $1,239
available, including the discretionary use reserve, under its GECC revolving credit facility.

The
new GECC senior credit facility includes three term loans with initial balances of $10,000 (Term A), $7,000 (Term B) and $5,000 (Term C), respectively. The maturity date on
the new senior credit facility is August 30, 2006.

The
new GECC revolving credit facility and term loans total $32,000 and replaced a similar facility which totaled $28,000, providing additional availability.

The
GECC loans are secured by a first priority security interest in all of the Morton Custom Plastics LLC assets, including, but not limited to, accounts receivable, inventories,
leaseholds, fixed assets, intangible assets and trade names.

The
interest on the GECC revolving credit facility, Term A and Term B is at LIBOR plus 450 basis points, with a LIBOR floor of 3% (effective rate of 7.25% at March 30, 2002). The
Company, alternatively, could select an index rate. Interest is to be paid monthly on these loans. The interest on Term C is 13% payment-in-kind. Unpaid interest on Term C is
due at maturity.

5

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The
principal on Term A and Term B amortizes quarterly in various amounts beginning on September 30, 2002 for Term A and June 30, 2002 for Term B. Final installments for
Term A and Term B are due at maturity, which is August 30, 2006. The principal on the revolving credit facility and Term C are due at maturity, which is August 30, 2006.

Warrant

In conjunction with the new credit facility, the Company issued to GECC a common stock warrant to purchase 70% ("Warrant Ownership Percentage") of the outstanding
ownership interests (on a fully diluted basis) of Morton Custom Plastics LLC. This warrant relates only to Morton Custom Plastics, LLC and does not relate to either the Class A or
Class B Common Stock of Morton Industrial Group, Inc. The Warrant Ownership Percentage shall be reduced to 35% if the loan is repaid in full before March 25, 2004. If adjusted
EBITDA for the year ending December 31, 2003, as defined in the agreement, is at least $8,000 and the Warrant Ownership Percentage has not already been reduced, the Warrant Ownership Percentage
shall be reduced to 51%.

At
any time on or after the occurrence of (i) the scheduled maturity date, (ii) an event of default, or (iii) the date of indefeasible prepayment in full of the
loans and cancellation of letters of credit and permanent reduction of revolving loan commitment to zero ("Trigger Events"), the holder has the right to require the Company to purchase all or any part
of the warrant ("Put Feature"). The Company also has the right to repurchase all, but not less than all, of the outstanding warrant and equity interests of the holder subsequent to a Trigger Event
("Call Feature"). The Put Feature and Call Feature each have a purchase price equal to the greater of the applicable floor price and the fair market value as determined in good faith by the board and
subject to approval by the holder. The initial floor price is $500, increasing to $4,000 by the debt maturity date in August, 2006 and to $13,000 at the warrant expiration date in March, 2012.

The
warrant is accounted for under EITF 00-19 "Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company's Own Stock." Since the
warrant can be settled for cash at the holder's option, it is recorded as a liability and as a discount on the related debt at its estimated fair value of $135. This instrument will be adjusted to
fair value each period with a corresponding charge or credit to earnings. The fair value of the warrant was estimated using a multiple of projected EBITDA, less total debt. No value was assigned to
the "Put Feature" at this time. The estimated value of this instrument could change significantly in the future based on changes in projected EBITDA or the estimated value of the "Put Feature".

(8)  Goodwill.

The Company adopted SFAS No.142, Goodwill and Other Intangible Assets, effective January 1, 2002, and accordingly, no goodwill amortization was recorded
for the quarter ended March 30, 2002. As of March 30, 2002, the Company has unamortized goodwill in the amount of $8.3 million which is subject to the transition provisions of
SFAS 141 and 142. Currently, it is not practicable to reasonably estimate the impact of adopting SFAS 141 and 142 on the Company's financial statements at the date of this report,
including whether it will be required to recognize any transitional impairment losses as the cumulative effect of a change in accounting principle.

6

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Goodwill
amortization totaled $95 for the first quarter of 2001. Had goodwill not been amortized during 2001, net earnings (loss) available to common stockholders for the quarter ended
March 31, 2001 would have been $(341) or $(0.07) per share.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis describes changes in the Company's financial condition since December 31, 2001. The analysis of results of operations
compares the quarters ended March 30, 2002 (restated) and March 31, 2001 (restated). Any references to December 31, 2001 relate to data found in Form 10-K/A as
filed with the Securities Exchange Commission on November 1, 2002.

RESULTS OF OPERATIONS

FIRST QUARTER, 2002 VERSUS FIRST QUARTER, 2001

Our net revenues for the first quarter, 2002 were $54.3 million compared to $74.4 million for the first quarter of 2001, a decrease of
$20.1 million, or 27.0%. The sales decrease resulted primarily from decreased demand by existing customers.

Our
sales to Deere & Company and Caterpillar Inc., were approximately 57% and 59% of our revenues for the first quarters, 2002 and 2001, respectively. Revenues from these
customers decreased approximately 28% from the same period in 2001.

Our
gross profits for the first quarter, 2002 decreased by approximately $2.3 million, a decrease of 24.3%, versus the same three months in 2001. The overall gross profit
percentage increased to 13.3% for the first quarter of 2002 from 12.9% for the first quarter of 2001. The decrease in gross profit dollars resulted primarily from the decrease in sales. The modest
increase in the gross profit percentage resulted primarily from continuing cost management efforts, including right-sizing the number of employees and the continued implementation of lean
manufacturing processes.

Our
selling and administrative expenses for the first quarter, 2002 amounted to $6.0 million, or 11.0% of net sales compared to $7.0 million, or 9.4% of net sales for the
first quarter of 2001. The percentage increase related to the decrease in sales. The $1.0 million decrease in expenses related to continuing cost management efforts.

Our
interest expense was $1.9 million for the first quarter of 2002, compared with $2.6 million for the first quarter of 2001. Although our overall debt level has increased
slightly from a year ago, decreases in the average interest rates for the comparable quarters has significantly reduced interest expense.

Our
other income was $237 thousand for the first quarter of 2002, compared with other expense of $233 thousand for the first quarter of 2001, primarily due to an unrealized gain of $220
thousand on the Company's interest rate swap instrument during 2002 versus an unrealized loss of $235 thousand for the first quarter of 2001.

For
the first quarter of 2002, we did not provide a tax benefit on the pre-tax loss of $342 thousand. For the first quarter of 2001, we did not provide a tax benefit
on the pre-tax loss of $285 thousand. For

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both periods, the impact on the net operating loss carryforward was offset by changes in the valuation allowance with no impact on the net deferred tax assets.

In
accordance with SFAS No. 142, the Company has not amortized goodwill during the first quarter of 2002. Goodwill amortization totaled $95,000 for the first quarter of 2001. Had
goodwill not been amortized during 2001, net earnings (loss) available to common stockholders for the quarter ended March 31, 2001 would have been $(425,000) or $(0.09) per share.

LIQUIDITY AND CAPITAL RESOURCES

Our consolidated working capital at March 30, 2002 was $2.3 million compared to a deficit of $1.5 million at December 31, 2001, an
increase in working capital of approximately $3.8 million. The increase in working capital relates primarily to increases in accounts receivable and inventory levels since year end, and was
funded by an increase in long-term debt.

The
Company has two separate credit facilities. One facility is with Harris Trust and Savings Bank, as Agent (Harris). This credit facility finances the Company's corporate operations,
as well as its contract metal fabrication operations in Illinois, North Carolina and South Carolina and its contract plastics fabrication operations in Iowa. The second facility is with General
Electric Capital Corporation (GECC). This credit facility finances the Company's contract plastic fabrication operations in North Carolina, South Carolina and Kentucky. The two credit facilities are
separately secured by the assets of the operations they support. Harris has no recourse against the assets secured by GECC; neither does GECC have recourse against the assets secured by Harris.

The Harris Trust and Savings Bank Credit Facility

In February, 2002, the Company entered into an amended and restated secured revolving credit facility with Harris Trust and Savings Bank, as Agent (Harris). The
revolving credit agreement permits the Company to borrow up to a maximum of $21,000,000. The agreement requires payment of a quarterly commitment fee of .50% per annum of the average daily unused
portion of the revolving credit facility. Interest is due monthly and is based on LIBOR plus 4.0% (totalling 6.25% at March 30, 2002). We, alternatively, could select an interest rate of bank
prime plus 1.5%. The amount available under the revolving credit facility is limited to 85% of qualified accounts receivable, 50% of eligible inventory, plus $2,500,000 of other assets. The revolving
credit agreement expires July 1, 2003. At March 30, 2002, the Company had $17,400,000 outstanding and $1,547,000 available under its Harris revolving credit facility.

In
February, 2002, the Company entered into an amended and restated secured term loan arrangement with Harris for a term loan of $32,965,000. This term loan is amortized monthly with
principal payments ranging from $235,000 to $500,000 and the balance of $24,930,000 due July 1, 2003. Interest is due monthly and is based upon LIBOR plus 4.0% (totalling 6.25% at
March 30, 2002). We, alternatively, could select an interest rate of bank prime plus 1.5%. These Harris debt agreements have maturity dates of July 1, 2003. The Company intends to obtain
loans to refinance the debt from other sources by the end of the term of this arrangement, which may not be available on acceptable terms and conditions. Failure to do so could have a material adverse
effect on the Company's operations.

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In
connection with these Harris loans, we have granted the lender a first lien on all of the Company's accounts receivable, inventory, equipment and various other assets, except for the
assets of Morton Custom Plastics, LLC. These Harris debt agreements, which finance the contract metal fabrication segment and one of the contract plastic fabrication segment locations, contain
restrictions on capital expenditures, additional debt or liens, investments, mergers and acquisitions, asset sales and payments such as dividends or stock repurchases. The agreements also impose
various financial covenants. Under the terms of this credit facility, no amounts have been available for payment of dividends.

In
connection with the Harris financing, we have two fixed interest rate swap agreements with a commercial bank (the "counter party"). The first agreement has a notional principal amount
of $5.0 million and a termination date of May 31, 2003. The second agreement has a notional principal amount of $14.1 million and a termination date of June 30, 2003. The
notional principal amount declines over the term of both agreements based upon a defined amortization schedule. The counter party waived its unilateral right to cancel both agreements as of
June 30, 2001. As described in Item 7A below, these agreements are for the purpose of limiting the effects of interest rate increases on half of the Company's floating rate term debt
with Harris.

Historically,
we have met our near term liquidity requirements for our businesses financed by Harris with cash flow from operations, the Harris line of credit, and management of our
working capital to reflect current levels of operations. The national economic slowdown, which our reduced revenues reflect, has increased pressure on these sources of liquidity. The new Harris
revolving credit facility and term loans replaced existing credit facilities and did not provide additional availability. However, the repayment and fee terms were modified, and the
short-term principal payments and fees were reduced. We anticipate that the amended and restated agreements with Harris will assist us in meeting our liquidity requirements through the
term of these agreements.

The General Electric Capital Corporation Credit Facility

In March, 2002, to restructure the financing related to the Morton Custom Plastics, LLC operations, the Company entered into an amended and restated revolving
credit facility and an amended and restated senior credit facility with its existing lender, General Electric Capital Corp. (GECC).

The
new revolving credit facility allows for borrowings up to a maximum of $10,000,000. Of the amount available under the revolver, $1,000,000 is held back as a reserve for discretionary
use approved by the lender. The amount available under the revolving credit facility is generally limited to 85% of qualified accounts receivable and 60% of eligible inventory. The revolving credit
agreement expires August 30, 2006. At March 30, 2002, the Company had $8,761,000 outstanding or committed and $1,239,000 available, including the discretionary use reserve, under its
GECC revolving credit facility.

The
new senior credit facility includes three term loans with initial balances of $10 million (Term A), $7 million (Term B) and $5 million (Term C),
respectively. The maturity date on the new senior credit facility is August 30, 2006.

The
loans are secured by a first priority security interest in all of the Morton Custom Plastics, LLC assets, including, but not limited to, accounts receivable, inventories, leaseholds,
fixed assets, intangible

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assets and tradenames. The GECC agreement contains restrictions on capital expenditures, additional debt or liens, investments, mergers and acquisitions, asset sales and payments such as dividends or
stock repurchases. The agreement also imposes various financial covenants. Under the terms of this credit facility, no amounts have been available for payment of dividends.

The
interest on the revolving credit facility, Term A and Term B is LIBOR plus 450 basis points, with a LIBOR floor of 3%. The Company, alternatively, could select an Index rate.
Interest is to be paid monthly on these loans. The interest on Term C is 13% payment-in-kind. Unpaid interest on Term C is due at maturity.

The
principal on Term A and Term B amortizes quarterly in various amounts beginning on September 30, 2002 for Term A and June 30, 2002 for Term B. Final installments for
Term A and Term B are due at maturity, which is August 30, 2006. The principal on the revolving credit facility and Term C are due at maturity, which is August 30, 2006.

Historically,
we have met our near term liquidity requirements for our businesses financed by GECC with cash flow from operations, the GECC line of credit, and management of our working
capital to reflect current levels of operations. The national economic slowdown, which Morton Custom Plastics, LLC's reduced revenues reflect, has increased pressure on these sources of liquidity. The
new GECC revolving credit facility and term loans total $32 million and replaced a similar facility which totaled approximately $28 million, providing additional availability.
Additionally, repayment terms were modified and short-term principal payments were reduced. We anticipate that the amended and restated agreements with GECC will assist the Company in
meeting its near term liquidity requirements.

Warrant

In conjunction with the new credit facility, the Company issued to GECC a common stock warrant to purchase 70% ("Warrant Ownership Percentage") of the outstanding
ownership interests (on a fully diluted basis) of Morton Custom Plastics LLC. This warrant relates only to Morton Custom Plastics, LLC and does not relate to either the Class A or
Class B Common Stock of Morton Industrial Group, Inc. The Warrant Ownership Percentage shall be reduced to 35% if the loan is repaid in full before March 25, 2004. If adjusted
EBITDA for the year ending December 31, 2003, as defined in the agreement, is at least $8,000,000 and the Warrant Ownership Percentage has not already been reduced, the Warrant Ownership
Percentage shall be reduced to 51%.

At
any time on or after the occurrence of (i) the scheduled maturity date, (ii) an event of default, or (iii) the date of indefeasible prepayment in full of the
loans and cancellation of letters of credit and permanent reduction of revolving loan commitment to zero ("Trigger Events"), the holder has the right to require the Company to purchase all or any part
of the warrant ("Put Feature"). The Company also has the right to repurchase all, but not less than all, of the outstanding warrant and equity interests of the holder subsequent to a Trigger Event
("Call Feature"). The Put Feature and Call Feature each have a purchase price equal to the greater of the applicable floor price and the fair market value as determined in good faith by the board and
subject to approval by the holder. The initial floor price is $500,000, increasing to $4,000,000 by the debt maturity date in August, 2006 and to $13,000,000 at the warrant expiration date in March,
2012.

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The
warrant is accounted for under EITF 00-19 "Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company's Own Stock." Since the
warrant can be settled for cash at the holder's option, it is recorded as a liability and as a discount on the related debt at its estimated fair value of $135,000. This instrument will be adjusted to
fair value each period with a corresponding charge or credit to earnings. The fair value of the warrant was estimated using a multiple of projected EBITDA, less total debt. No value was assigned to
the "Put Feature" at this time. The estimated value of this instrument could change significantly in the future based on changes in projected EBITDA or the estimated value of the "Put Feature".

Preferred Stock

As part of the financing for the 1999 Morton Custom Plastics, LLC acquisition, we issued 10,000 shares of redeemable preferred stock, which we must redeem in
April, 2004 at $1,000 per share plus any dividends accrued since April 15, 1999. The $10 million face value preferred stock was recorded at its fair value of $4.25 million. We are
accreting the discount over a five year period using the effective yield method. Dividends are payable in kind at the rate of 8% per annum. We believe that certain provisions of the agreement with
Worthington preclude the payment of dividends, and no dividends have been accrued in 2000, 2001 or 2002. There are current legal proceedings related to certain Worthington matters as described in
Part II, Item 1.

Capital Expenditures

We incurred $0.8 million of capital expenditures during the first quarter of 2002, primarily for the update and purchase of manufacturing equipment.

We
estimate that our capital expenditures in 2002 will total approximately $4.0 million, of which $1.0 million will be for new production equipment and the remaining
$3.0 million will be for normal replacement items.

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IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

In July 2001, the FASB issued SFAS No. 141,Business Combinations, and SFAS No. 142, Goodwill and
Other Intangible Assets. SFAS 141 requires that the purchase method of accounting be used for all business combinations initiated
after June 30, 2001 as well as all purchase method business combinations completed after June 30, 2001. SFAS 141 also specifies criteria intangible assets acquired in a purchase
method business combination must meet to be recognized and reported apart from goodwill, noting that any purchase price allocable to an assembled workforce may not be accounted for separately.
SFAS 142 will require that goodwill and intangible assets with indefinite useful lives no longer be amortized, but instead tested for impairment at least annually in accordance with the
provisions of SFAS 142. SFAS 142 will also require that intangible assets with estimable useful lives be amortized over their respective estimated useful lives to their estimated
residual values, and reviewed for impairment.

The
Company was required to adopt the provisions of SFAS 141 immediately and adopted SFAS 142 effective January 1, 2002 Accordingly, no goodwill amortization was
recorded for the quarter ended March 30, 2002. In connection with SFAS 142's transitional goodwill impairment evaluation, the Statement will require the Company to perform an assessment
of whether there is an indication that goodwill is impaired as of the date of adoption. To accomplish this, the Company must identify its reporting units and determine the carrying value of each
reporting unit by assigning the assets and liabilities, including the existing goodwill and intangible assets, to those reporting units as of the date of adoption. The Company will then have up to six
months from the date of adoption to determine the fair value of each reporting unit and compare it to the reporting unit's carrying amount. To the extent a reporting unit's carrying amount exceeds its
fair value, an indication exists that the reporting unit's goodwill may be impaired and the Company must perform the second step of the transitional impairment test. In the second step, the Company
must compare the implied fair value of the reporting unit's goodwill, determined by allocating the reporting unit's fair value to all of its assets (recognized and unrecognized) and liabilities in a
manner similar to a purchase price allocation in accordance with SFAS 141, to its carrying amount, both of which would be measured as of the date of adoption. This second step is required to be
completed as soon as possible, but no later than the end of the year of adoption. Any transitional impairment loss will be recognized as the cumulative effect of a change in accounting principle in
the Company's statement of operations.

As
of March 30, 2002, the Company has unamortized goodwill in the amount of $8.3 million which is subject to the transition provisions of SFAS 141 and 142. Because
of the extensive effort needed to comply with adopting SFAS 141 and 142, it is not practicable to reasonably estimate the impact of adopting these Statements on the Company's financial
statements at the date of this report, including whether it will be required to recognize any transitional impairment losses as the cumulative effect of a change in accounting principle.

In
August 2001, the Financial Accounting Standards Board issued SFAS No. 144,Accounting for the Impairment or Disposal of Long-Lived
Assets, which supersedes both SFAS No. 121,Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets
to Be Disposed Ofand the accounting and reporting provisions of APB Opinion No. 30,Reporting the Results of OperationsReporting
the Effects of Disposal of a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring Events and Transactions(Opinion 30), for the disposal of a segment of
a business (as previously defined in that Opinion). SFAS 144 retains the fundamental provisions in SFAS 121 for recognizing and measuring impairment losses on long-lived
assets held for use and long-lived assets to be disposed of by sale, while also resolving significant implementation issues associated with SFAS 121.

The
Company adopted SFAS 144 on January 1, 2002. The adoption of SFAS 144 for long-lived assets held for use did not have a material impact on the
Company's financial statements because the impairment assessment under SFAS 144 is largely unchanged from SFAS 121. The provisions of the

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Statement for assets held for sale or other disposal generally are required to be applied prospectively after the adoption date to newly initiated disposal activities. Therefore, management cannot
determine the potential effects that adoption of SFAS 144 will have on the Company's future financial results.

In
April 2002, the Financial Accounting Standards Board issued Statement No. 145, "Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB Statement
No. 13, and Technical Corrections". This Statement rescinds FASB Statement No. 4, "Reporting Gains and Losses from Extinguishment of Debt", and FASB Statement No. 64,
"Extinguishments of Debt Made to Satisfy Sinking-Fund Requirements". This Statement also rescinds FASB Statement No. 44, "Accounting for Intangible Assets of Motor Carriers". This
Statement amends FASB Statement No. 13, "Accounting for Leases", to eliminate an inconsistency between the required accounting for sale-leaseback transactions and the required
accounting for certain lease modifications that have economic effects that are similar to sale-leaseback transactions. This Statement also amends other existing authoritative
pronouncements to make various technical corrections, clarify meanings, or describe their applicability under changed conditions. The provision of this Statement related to the rescission of Statement
4 are applicable in fiscal years beginning after May 15, 2002. Early application is encouraged. The provisions of this Statement related to Statement 13 are effective for transactions occurring
after May 15, 2002, with early application encouraged. All other provisions of this Statement are effective for financial statements issued on or after May 15, 2002, with early
application encouraged. Management is evaluating the effect of this statement on the Company's results of operations and financial position.

FORWARD LOOKING STATEMENTS

"Safe Harbor" Statement Under The Private Securities Litigation Reform Act Of 1995: This annual report contains "forward looking statements" within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements containing the words "anticipates," "believes," "intends,"
"estimates," "expects," "projects" and similar words. The forward looking statements involve known and unknown risks, uncertainties and other factors that may cause
our actual results to be materially different from any future results expressed or implied by such forward looking statements. Such factors include, among others, the following: the loss of certain
significant customers; the cyclicality of our construction and agricultural sales; risks associated with our acquisition strategy; general economic and business conditions, both nationally and in the
markets in which we operate or will operate; competition; and other factors referenced in the Company's reports and registration statements filed with the Securities and Exchange Commission. Given
these uncertainties, prospective investors are cautioned not to place undue reliance on such forward looking statements. The forward looking statements contained herein speak only of the Company's
expectation as of the date of this annual report. We disclaim any obligations to update any such factors or publicly announce the result of any revisions to any of the forward looking statements
contained herein to reflect future events or developments.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

We are exposed to interest rate changes primarily as a result of our lines of credit and long term debt used for maintaining liquidity, funding capital
expenditures, and expanding our operations. The Company's interest rate risk management objective is to limit the impact of interest rate changes on earnings and cash flow and to lower overall
borrowing costs. To achieve our objectives, we entered into two separate financing agreements with a group of banks and another lender. Both financing arrangements contain term loans and revolving
credit facilities. Interest is based on our lead bank's or lender's prime rate plus an applicable variable margin. We have also entered into two interest rate swap agreements, as required by one of
our bank financing arrangements, to limit the effect of increases in the interest rates on half of its floating rate term debt. Under the swap agreements, which expire May 31, 2003 to
June 30, 2003, a LIBOR-equivalent interest rate component of the interest rate

13

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is limited to 5.875% on half of the Company's $32.7 million term loans. If interest rates moved 100 basis points, the effect on income before income taxes would be $327,000.

The
Company does not enter into interest rate transactions for speculative purposes.

ITEM 4. CONTROLS AND PROCEDURES

For a discussion of any changes in the Company's internal controls or in other factors that could significantly affect those controls, see Item 4 of the
Company's Form 10-Q for the quarter ended June 29, 2002, filed with the Securities and Exchange Commission concurrently with this Form 10-Q/A.

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PART IIOTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There have been no significant changes in the status of the Worthington Industries, Inc. suit referenced in the Company's Form 10-K for
2000 filed with the Securities and Exchange Commission on April 2, 2001.

ITEM 2. CHANGES IN SECURITIES

On September 20, 2000, the Company issued warrants to purchase 238,548 shares of its Class A Common Stock at an exercise price of $.01 per share.
Under the terms of the February, 2002 amendment with Harris Bank, the warrants may be exercised at any time through December 31, 2003.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

11.

The computation can be determined from this report.99.1

Certification pursuant to 18 U.S.C. Section 1350, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.99.2

Certification pursuant to 18 U.S.C. Section 1350, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


None

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.

| |  | MORTON INDUSTRIAL GROUP, INC.
| |  | -----------------------------
| |  | By:                          

Dated:
November 4, 2002

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I, William D. Morton, as Chairman and Chief Executive Officer of Morton Industrial Group, Inc., certify that:

|/s/WILLIAM D. MORTONWilliam D. Morton
Chairman and Chief Executive Officer
November 4, 2002 | 
|------------------------------------------------------------------------------------------- | 

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I, Thomas D. Lauerman, as Vice President of Finance of Morton Industrial Group, Inc., certify that:

|/s/THOMAS D. LAUERMANThomas D. Lauerman
Vice President of Finance
November 4, 2002 | 
|---------------------------------------------------------------------------------- | 

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