2. Select Filter/Shape Tools/Morph. 
 
That's the morph panel. On the left side there is the source image, on the right side there is the
destination image. The preview in the middle of the dialog shows the morph steps. To see this,
you have to move the slider below the preview. 
Your first action is to place some arrows in the source window. To set an arrow click in the
source window and drag to the end of the arrow. Every time you set an arrow in the source
image, you will get the same arrow in the destination image. Then activate the edit mode button and drag the arrow in the destination image to the place where the part of the source image should be moved. 
If it's easier for you, you can also set the arrow in the destination image and then edit the arrow
in the source window. 

3. Setup the amount of steps you want to get at Steps.  

4. Now press OK and PhotoLine 32 will create an animation. 

5. Select Tool/Animate layers to see the animation. You can save the animation in GIF-format.