Delphi and transparent images

I need to overlap 2 images in Delphi 5 so that part of the top image will be transparent.

I have read instructions here

[url removed, login to view]

However, when I try to apply them, I get no transparency and often I get no

visible top image at all.

Please show me how to do it in a test application of little or no code.

I am attaching the code I tried to run.

Note that Delphi 5 is required, as this code must be part of a large D5 application.

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