SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

[X]      Annual  Report  Pursuant to Section 13 or 15(d) of the  Securities  and
         Exchange Act of 1934 For the fiscal year ended December 31, 1998

                                       OR

[   ]    Transition Report Pursuant to Section 13 or 15(d) of the Securities and
         Exchange Act of 1934
         For the transition period from                 to                 
                                        ---------------    ----------------

Commission file number: 1-3916

                            ARTRA GROUP INCORPORATED
             (Exact name of registrant as specified in its charter)


  Commonwealth of Pennsylvania                           25-1095978
 --------------------------------            ----------------------------------
 (State or other jurisdiction of            (I.R.S. Employer Identification No.)
  incorporation or organization)


  500 Central Avenue, Northfield, IL                      60093 
 --------------------------------------                  -------- 
(Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code:    (847) 441-6650

Securities registered pursuant to Section 12(b) of the Act:
                                                      Name of Each Exchange
      Title of Each Class                              on Which Registered    
-------------------------------                      -----------------------    
Common stock, without par value                      New York Stock Exchange
                                                     Pacific Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:  None.

Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best  of  registrant's   knowledge,  in  the  definitive  proxy  or  information
statements  incorporated  by  reference  in Part  III of this  Form  10-K or any
amendment to this Form 10-K. [ ]

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 [X] No [ ]

State the aggregate  market value of the voting stock held by  nonaffiliates  of
the registrant at January 29, 1999: $36,435,000.

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

           Class                                Outstanding at January 29, 1999
--------------------------------                -------------------------------
Common stock, without par value                           7,864,228

Documents Incorporated by Reference: None.

Items Amended:  Part III, Item 10, Item 11, Item 12 and Item 13.
<PAGE>



                                    PART III

Item 10.          Directors and Executive Officers of the Registrant.

Directors and Executive Officers of Artra

         Information Regarding Directors

         The  following  table lists the name and age of each director of Artra,
his business experience, his positions with Artra and certain directorships.

Name                       Age          Positions and Experience
----                       ---          ------------------------

John Harvey                67           Chairman of the Board of  Directors  and
                                        Chief   Executive   Officer   of  Artra;
                                        Director  since  1968;  Chairman  of the
                                        Board  of   Directors,   since  1985,  a
                                        Director  from 1982 to December 1995 and
                                        the Chief Executive Officer from 1990 to
                                        November  1995 of  COMFORCE  Corporation
                                        (temporary   professional    employment,
                                        formerly   The  Lori   Corporation);   a
                                        Director  of  Plastic   Specialties  and
                                        Technologies,  Inc. (textiles,  hose and
                                        tubing);     Director     of     PureTec
                                        Corporation,  the successor by merger to
                                        Ozite, until March of 1998, when PureTec
                                        was merged into Teckni-Plex, Inc.

Peter R. Harvey            64           President and  Chief  Operating  Officer
                                        and a Director  since 1968;  Director of
                                        COMFORCE     Corporation      (temporary
                                        professional  employment,  formerly  The
                                        Lori  Corporation) from 1985 to December
                                        1995  and  a  vice   president   through
                                        January   1996;   Director   of  PureTec
                                        Corporation (textiles, hose and tubing),
                                        the successor by merger to Ozite,  until
                                        March of 1998, when PureTec  Corporation
                                        was merged into Teckni-Plex, Inc.

Gerard M. Kenny            46           Director  since  1988;  Executive   Vice
                                        President  and  Director  since  1982 of
                                        Kenny  Construction  Company  since 1982
                                        (diversified    heavy     construction);
                                        General  Partner of  Clinton  Industries
                                        (investments),  a  limited  partnership,
                                        since 1972.

Edward A. Celano           60           Director  since  1996;   Executive  Vice
                                        President  of the  Atlantic  Bank of New
                                        York  since  May 1,  1996,  Senior  Vice
                                        President of National  Westminster,  USA
                                        from 1984 through April 1996,  corporate
                                        finance.




                                       -1-

<PAGE>





Howard R. Conant           74           Director since 1996; Retired Chairman of
                                        the Board of Interstate  Steel Co., 1970
                                        to 1990,  and a consultant to Interstate
                                        through 1992.

Maynard K. Louis           69           Director since 1996; Retired Chairman of
                                        the  Board  of Lord  Label,  a  printing
                                        company  now known as Porter & Chadburn,
                                        from 1965 to 1989, Vice President,  1989
                                        to 1993,  director  of Artra  from  1993
                                        through 1995.

Robert L. Johnson          62           Director since 1996; Chairman and  Chief
                                        Executive   Officer  of  Johnson  Bryce,
                                        Inc.,  flexible  packaging  materials of
                                        food    products    since   1991,    and
                                        previously,   for  many  years,  a  vice
                                        president   of  Sears   Roebuck   &  Co.
                                        (retailing company).

Mark Santacrose            39           Director  since   1997;   President   of
                                        Bagcraft  Corporation  of America (n/k/a
                                        Golden   Corp.),    flexible   packaging
                                        materials of food products,  since 1994;
                                        Executive  Vice  President  of  Bagcraft
                                        since  1993;   following   the  sale  of
                                        substantially   all  of  the  assets  of
                                        Bagcraft in 1998,  President of Bagcraft
                                        Packaging LLC, a subsidiary of Packaging
                                        Dynamics LLC since 1998.

John K. Tull               72           Director since 1998;  President of  J.K.
                                        Tull  Associates  LTD.,  a  mergers  and
                                        acquisitions firm, since 1986.

         COMFORCE  Corporation  was a 64.3%  owned  subsidiary  of  Artra  until
December, 1995. Artra now owns approximately 9% of COMFORCE Corporation. PureTec
International,  Inc. and  Plastics  Specialities  and  Technologies,  Inc.  were
affiliates  of Artra.  Bagcraft was a wholly owned  subsidiary  of BCA Holdings,
Inc., a wholly owned subsidiary of Artra. In November,  1998,  substantially all
of the assets of Bagcraft were sold to Packaging Dynamics LLC, the parent entity
of Bagcraft Packaging LLC.

         Information Regarding Executive Officers

         Set forth below is information  concerning  the executive  officers and
other key  employees  of Artra who were in office or  employed as of the date of
this Proxy Statement/Prospectus.












                                       -2-

<PAGE>

Name                 Age     Position
----                 ---    --------

John Harvey          67    Chairman of the Board and Chief Executive Officer
Peter R. Harvey      64    President and Chief Operating Officer
John G. Hamm         60    Executive Vice President
Robert S. Gruber     64    Vice President - Corporate Relations
James D. Doering     62    Vice President, Treasurer and Chief Financial Officer
John Conroy          54    Vice President - Corporate Administration
Lawrence D. Levin    47    Controller
Edwin G. Rymek       68    Secretary

         John Harvey is the Chairman and Chief Executive  Officer of Artra.  See
"Information  Concerning  Directors"  above for a  description  of Mr.  Harvey's
relevant business experience.

         Peter R. Harvey is the President and Chief Operating  Officer of Artra.
See "Information  Concerning  Directors" above for a description of Mr. Harvey's
relevant business experience.

         John G. Hamm is the  Executive  Vice  President of Artra.  Mr. Hamm has
served as Executive Vice President since February 1988 and as the Vice President
-  Finance  from 1975  until  1988 of Artra.  Mr.  Hamm has also  served as Vice
President  Finance from August 1990 until July 1995 and as a Director  from 1984
until July 1995 of Ozite Corporation.  Mr. Hamm has also served as a Director of
SoftNet  Systems,  Inc.  from 1985 to  February  1999 and a Director  of Plastic
Specialties and Technologies, Inc. from 1985 until January, 1996.

         Robert S. Gruber is the Vice President - Corporate  Relations of Artra.
Mr.  Gruber has served as Vice  President - Corporate  Relations  of Artra since
1975 and as a consultant to The Lori  Corporation  from 1982 to 1995. Mr. Gruber
has also served as a consultant to COMFORCE Corporation during 1996.

         James D. Doering is the Vice  President,  Treasurer and Chief Financial
Officer of Artra. Mr. Doering has served as Vice President since 1980, Treasurer
since 1987,  Chief  Financial  Officer since February 1988, and Controller  from
1980 to 1987. Mr. Doering has also served as Vice President and Chief  Financial
Officer of COMFORCE Corporation from February 1988 through January 1996.

         John Conroy is the Vice President - Corporate  Administration of Artra.
Mr. Conroy has served as Vice President - Corporate  Administration  since March
1990. Prior thereto, he served as Vice President - Corporate Administration,  of
Sargent-Welch  Scientific  Company from  September  1988 to December  1989.  Mr.
Conroy  previously  served in various risk management  positions with Artra from
1978 to September 1988, most recently as Corporate Risk Director.

         Lawrence D. Levin is the  Controller of Artra.  Mr. Levin has served as
Controller since 1987,  Assistant  Treasurer and Assistant  Secretary since 1980
and Assistant Controller




                                       -3-

<PAGE>




from 1980 to 1987.  Mr. Levin has also served as  Controller  of COMFORCE  since
December 1989 through January 1996 and as the Assistant Chief Financial  Officer
of COMFORCE Corporation from May 1993 through January 1996.

         Edwin G.  Rymek is the  Secretary  of Artra.  Mr.  Rymek has  served as
Secretary  of Artra since 1987 and of  COMFORCE  Corporation  from 1982  through
1995.

         Officers  are  appointed  by the  Artra  Boards  of  Directors  and its
subsidiaries and serve at the pleasure of each respective board.  Except for the
relationship  of Peter R. Harvey and John Harvey who are brothers,  there are no
family  relationships  among the executive  officers and/or  directors,  nor are
there any arrangements or understandings  between any officer and another person
pursuant  to which he was  appointed  to  office  except  as may be  hereinafter
described.

         Section 16(a) Beneficial Reporting Compliance

         Section  16(a) of the Exchange Act requires that officers and directors
of  Artra,  as well as  persons  who own  more  than  10% of a class  of  equity
securities of Artra, file reports of their ownership of such securities, as well
as  monthly  statements  of  changes  in  such  ownership,  with  Artra  and the
Commission.  Based  upon  written  representations  received  by Artra  from its
officers and directors and reports filed with Artra during 1998,  Artra believes
that all such filings required during 1998 were made on a timely basis.

Item 11.          Executive Compensation

Directors' Compensation

         Directors  who are not  employees  of Artra are  entitled to receive an
annual  retainer of $10,000.  Each outside  director who sits on an  established
committee of Artra is entitled to receive $250 per  committee  meeting  attended
and the chairman of a committee  is entitled to receive  $500 for each  meeting.
Employees of Artra who also serve as directors or committee  members  receive no
additional  compensation  for such service.  During the year ended  December 21,
1998,  Artra  granted to each of its five  outside  directors  stock  options to
purchase  12,500 shares of Artra Common Stock at a purchase  price of $3.125 per
share.
These options have a term of ten years form the date of grant.

Executive Officer Compensation

         The  following  table  shows  all  compensation  paid by Artra  and its
subsidiaries for the fiscal years ended December 31, 1998, and December 31, 1997
and December 26, 1996, to the chief  executive  officer of Artra and each of its
other most highly  compensated  executive officers who were serving as executive
officers of Artra as of December 31, 1998, or who




                                       -4-

<PAGE>




would have been included had he been serving as an executive officer of Artra as
of December 31, 1998, and whose compensation exceeded $100,000 in 1998.

                           Summary Compensation Table

<TABLE>
<CAPTION>
                                                                                          Long-Term
                                                                                        Compensation
                                                                                       --------------
                                                          Annual Compensation              Awards
                                                   -------------------------------     --------------
                                                                                         Securities
                                                                      Other Annual       Underlying             All Other
Name and Principal Position            Year        Salary($)        Compensation($)      Options(2)           Compensation($)
---------------------------            ----        ---------        ---------------      ----------           ---------------

<S>                                    <C>          <C>                       <C>             <C>                 <C>    
John Harvey,                           1998         $157,404                 -0-             -0-                  $4,750 (3)
Chairman and Chief                     1997          190,000                 -0-             -0-                     -0-
Executive Officer                      1996          137,811                 -0-           141,000                 5,456

Peter R. Harvey,                       1998         $252,000                 -0-             -0-                   5,000 (3)
President and Chief                    1997           17,000                 -0-             -0-                     -0-
Operating Officer                      1996           17,000                 -0-             -0-                     -0-

James D. Doering                       1998         $147,000              11,500             -0-                   5,000 (3)
Vice President, Treasurer              1997          147,000                  --             -0-                   4,750
and Chief Financial Officer            1996          133,600                  --            57,500                 6,000

John G. Hamm,                          1998         $147,000                                 -0-                   5,000
Executive Vice President               1997          147,000                 -0-             -0-                   4,750
                                       1996          133,600                 -0-           101,250                 6,000
                                                                             -0-
Robert S. Gruber,                      1998         $110,400                 -0-             -0-                     -0- (3)
Vice President                         1997          110,400                 -0-             -0-                   6,000
Corporation Relations                  1996           92,000                 -0-            97,750                 2,868

Mark Santacrose,                       1998         $212,648            $590,000(4)          -0-                   4,750 (3)
President Bagcraft Corporation         1997          225,000              75,000             -0-                 144,616
of America                             1996          200,000              17,500             -0-                  89,524
------------------------

<FN>
(1)      No additional annual compensation was paid, no restrictive stock awards
         or stock appreciation  rights were granted,  and no long-term incentive
         plan payouts were made to any of the officers listed in the table. Only
         compensation earned in 1998 (irrespective of the year in which paid) is
         considered in determining inclusion in this table.

(2)      All of the options shown in this column were granted under Artra's 1996
         Stock  Option Plan at an exercise  price of $5.25 per share,  being the
         closing  price of Artra Common Stock on the New York Stock  Exchange on
         October 4, 1996,  the date of grant.  These options  expire  October 4,
         2006.




                                       -5-

<PAGE>




(3)      These amounts include Artra's contributions to the  401(k) plan  during
         1998, 1997 and 1996.

(4)      Mr.  Santacrose  also  participated  in a  Bagcraft  unfunded  deferred
         compensation  plan.  The  1998  bonus  amount  includes   approximately
         $340,000 realized from Mr. Santacrose's participation in such plan. The
         balance of amounts due Mr.  Santacrose  under such plan,  approximately
         $340,000, were paid in 1999.
</FN>
</TABLE>


         Artra did not grant  options to purchase  Artra  Common Stock to any of
the executive  officers named in the Summary  Compensation Table during the year
ended December 31, 1998.

         The following  table sets forth  information  concerning  the aggregate
number and values of options held by the Chief  Executive  Officer and the other
executive  officers  of Artra  listed in the  Summary  Compensation  Table as of
December 31, 1998 which were granted to such officers in  consideration of their
services as officers or directors of Artra.  No other  options held by the Chief
Executive Officer or any other executive officers of Artra listed in the Summary
Compensation Table were exercised in 1998.

  Aggregated Option Exercises in 1998 And Option Values As Of December 31, 1998

<TABLE>
<CAPTION>
                                                                Number of Securities Underlying    Value of Unexercised In-the-Money
                                                                    Unexercised Options at                     Options
                                                                        Fiscal Year-End                  at Fiscal Year-End(2)
                                                                ------------------------------        ---------------------------
                              Acquired on       Value
Name                          Exercise(#)     Realized(1)     Exercisable(#)     Unexercisable(#)     Exercisable   Unexercisable
----                          -----------     -----------     --------------     ----------------     -----------   -------------
<S>                               <C>           <C>               <C>                    <C>            <C>              <C>
John Harvey...............       -0-            $-0-              221,000               -0-             $42,600         -0- 
James D. Doering..........       -0-             -0-              111,000               -0-              22,657         -0- 
John G. Hamm..............       -0-             -0-              140,450               -0-              19,750         -0- 
Robert S. Gruber..........       -0-             -0-              118,750               -0-              10,088         -0- 
Mark Santacrose...........       -0-             -0-                  -0-               -0-                 -0-         -0- 

------------------------                                                                                                        
<FN>
(1)      See the notes under "Principal  Shareholders"  for a description of the                                                   
         options  (including  exercise  prices) granted to each of the executive
         officers listed in this table.

(2)      The listed  options  were issued at per share  exercise  prices of from
         $3.65 per share to $5.25 per share.  The market  price of Artra  Common
         Stock as of the close of trading on  December  31, 1998 on the New York
         Stock Exchange was $4.1875 per share.
</FN>
</TABLE>





                                                        

                                      -6-

<PAGE>




Item 12.      Security Ownership of Certain Beneficial Owners and Management

         The following  table sets forth,  as of April 23, 1999,  the amount and
percentage of Artra Common Stock and Artra Series A Preferred Stock beneficially
owned by (i) each person who is known by Artra to own beneficially  more than 5%
of the  outstanding  shares of Artra  Common  Stock or Artra  Series A Preferred
Stock, (ii) each director and nominee for director, (iii) each executive officer
named in the Summary  Compensation  Table and (iv) all  executive  officers  and
directors of Artra as a group.

                                                        Number
                                                       of Shares
                                                      Beneficially
Name of Beneficial Owner                                 Owned        Percent
------------------------                                --------      -------

The Equitable Companies Incorporated (1)                 559,099          6.4%
Peter R. Harvey (2)          Common                      590,243          6.6%
                             Preferred                       441         23.9%
John Harvey(3)                                           531,906          5.9%
Gerard M. Kenny(4)                                       180,064          2.0%
Maynard K. Louis(5)                                       84,500          1.0%
Edward A. Celano(6)                                       18,700           *
Howard R. Conant(7)                                      324,000          3.7%
Robert L. Johnson(8)                                      17,873           *
John G. Hamm(9)                                          177,232          2.0%
Robert S. Gruber(10)                                    152,354           1.7%
James D. Doering(11)                                    147,693           1.7%
Mark Santacrose (12)                                      23,555           *
John K. Tull (13)                                         35,143           *
All directors and officers as a group (15 persons)     2,598,782         25.2%
------------------
* Less than 1% of the outstanding shares.

(1)  The  address  of The  Equitable  Companies  Incorporated  ("Equitable"),  a
     Delaware corporation,  is 1290 Avenue of the Americas,  New York, New York.
     The shares  beneficially  owned by Equitable  consist of 559,100  shares of
     Artra Common Stock owned by four French  mutual  insurance  companies,  AXA
     Assurances I.A.R.D. Mutuelle, AXA Assurances Vie Mutuelle, Alpha Assurances
     Vie  Mutuelle  and  AXA  Courtage  Assurances  Mutuelle,  which  as a group
     beneficially  own a majority  interest  in  AXA-UAP,  which owns a majority
     interest in Equitable.

(2)  Mr. Peter R. Harvey's  business address is 500 Central Avenue,  Northfield,
     Illinois  60093.  The shares  beneficially  owned by Mr. Harvey  consist of
     374,056  shares held  directly by him, of which 373,615 are shares of Artra
     Common Stock and 441 are shares of Artra Series A Preferred  Stock,  23,001
     shares held as trustee for the benefit of his nieces,  800 shares  owned by
     his wife and  children,  634 shares held in his 401(k)  plan,  7,193 shares
     held in his individual retirement account, 20,000




                                                     

                                       -7-

<PAGE>




     shares  issuable  under an option which  expires  September  19, 2001 at an
     exercise price of $3.65 per share,  15,000 shares  issuable under an option
     which expires  January 8, 2003 at an exercise  price of $3.75 per share and
     150,000 shares issuable under an option which expires January 6, 2009 at an
     exercise price of $4.75 per share.

(3)  Mr.  John  Harvey's  business  address is 500 Central  Avenue,  Northfield,
     Illinois 60093. The shares of Artra Common Stock  beneficially owned by Mr.
     Harvey consist of 7,452 shares held in his 401(k) plan, 139,806 shares held
     as trustee for the benefit of the Harvey Family Trust,  100,000 shares held
     by Mr.  Harvey's  daughters,  47,603 shares  issuable under an option which
     expires  December 19, 2000 at an exercise  price of $3.65 per share,  1,000
     shares  issuable  under an option which  expires  September  19, 2001 at an
     exercise  price of $3.65 per share,  4,000 shares  issuable under an option
     which  expires  January  8, 2003 at an  exercise  price of $3.75 per share,
     131,000 shares issuable under an option which expires October 4, 2006 at an
     exercise  price of $5.25 per share,  35,000  issuable under an option which
     expires  January  6,  2009 at an  exercise  price of $4.75 per share and an
     aggregate of 66,045  shares  issuable  under  warrants  expiring at various
     dates in 2000 and 2001 received in 1995 and 1996 as additional compensation
     for 1995 and 1996 short-term loans at exercise prices of $3.75 per share to
     $6.25 per share.

(4)  The shares of Artra Common Stock beneficially owned by Mr. Kenny consist of
     75,652  shares held by Kenny  Construction  Company,  14,411 shares held by
     Clinton  Industries,  12,500 shares  issuable under an option which expires
     May 28,  2008 at an  exercise  price of  $3.125  per  share,  2,500  shares
     issuable  under an option  which  expires  February  1, 2009 at an exercise
     price of $5.375 per share and 75,001 shares  issuable  under a warrant held
     by Clinton  Industries which expires November 10, 1999 at an exercise price
     of $4.00 per share.  Mr. Kenny is Executive  Vice  President,  Director and
     beneficial  owner of 16.66% of the  issued and  outstanding  stock of Kenny
     Construction  Company.  He  is  also  the  General  Partner  and  a  14.28%
     beneficial  owner  of  Clinton  Industries,  a  limited  partnership.   See
     paragraphs 4 and 5 under "Transactions with Management and Others."

(5)  The shares of Artra Common Stock beneficially owned by Mr. Louis consist of
     17,500 shares held directly by him,  12,500 shares issuable under an option
     which expires May 28, 2008 at an exercise price of $3.125 per share,  2,500
     shares  issuable  under an  option  which  expires  February  1, 2009 at an
     exercise  price of $5.375 per share and warrants to purchase  52,000 shares
     of ARTRA common stock at prices of $5.125 to $8.00 per share which warrants
     expire on various dates commencing in 1999 and ending June 13, 2001.





                                                       



                                       -8-

<PAGE>




(6)  The shares of Artra Common Stock  beneficially  owned by Mr. Celano consist
     of 3,700  shares held  directly by him,  12,500  shares  issuable  under an
     option which expires May 28, 2008 at an exercise  price of $3.125 per share
     and 2,500 shares issuable under an option which expires February 1, 2009 at
     an exercise price of $5.375 per share.

(7)  Mr. Conant holds 150,000 shares of Artra Common Shares  directly and 20,000
     shares in his individual  retirement account. Mr. Conant's wife holds 9,000
     shares of Artra Common Stock. The shares of Artra Common Stock beneficially
     owned by Mr.  Conant also include  12,500 shares  issuable  under an option
     which expires May 28, 2008 at an exercise price of $3.125 per share,  2,500
     shares  issuable  under an  option  which  expires  February  1, 2009 at an
     exercise  price of $5.375 per share and warrants to acquire  130,000 shares
     of Artra  Common  Stock at prices of  $3.9375  to  $5.875  per share  which
     warrants expire on various dates in 2001 and 2002.

(8)  The shares of Artra Common Stock  beneficially owned by Mr. Johnson consist
     of 2,873  shares held  directly by him,  12,500  shares  issuable  under an
     option which expires May 28, 2008 at an exercise  price of $3.125 per share
     and 2,500 shares issuable under an option which expires February 1, 2009 at
     an exercise price of $5.375 per share.

(9)  The shares of Artra Common Stock  beneficially owned by Mr. Hamm consist of
     50 shares held directly by him, 93 shares held by him and his wife jointly,
     1,639 shares held in his 401(k) plan,  2,767 shares held in his  individual
     retirement  account,  25,000 shares  issuable under an option which expires
     December  19, 2000 at an exercise  price of $3.65 per share,  1,000  shares
     issuable  under an option which  expires  September 19, 2001 at an exercise
     price of $3.65 per share,  13,200  shares  issuable  under an option  which
     expires  January 8, 2003 at an exercise  price of $3.75 per share,  101,250
     shares  issuable  under an option  which  expires  October 4,  2006,  at an
     exercise  price of $5.25 per  share and  35,000  shares  issuable  under an
     option  which  expires  January 6, 2009 at an  exercise  price of $4.75 per
     share.

(10) The shares of Artra Common Stock  beneficially  owned by Mr. Gruber consist
     of 20,190  shares held directly by him, 943 shares held in his 401(k) plan,
     1,221  shares  held in his  individual  retirement  account,  8,000  shares
     issuable  under an option  which  expires  December 19, 2000 at an exercise
     price of $3.65 per  share,  1,000  shares  issuable  under an option  which
     expires September 19, 2001 at an exercise price of $3.65 per share,  12,000
     shares  issuable  under an  option  which  expires  January  8,  2003 at an
     exercise price of $3.75 per share,  97,750 shares  issuable under an option
     which expires October 4, 2006, at an exercise price of




                                                        

                                      -9-

<PAGE>




     $5.25 per share and 11,250 shares  issuable under an  option  which expires
     January 6, 2009 at an exercise price of $4.75 per share.

(11) The shares of Artra Common Stock  beneficially owned by Mr. Doering consist
     of 1,693 shares held in his 401(k) plan,  22,500 shares  issuable  under an
     option which  expires  December 19, 2000 at an exercise  price of $3.65 per
     share, 31,000 shares issuable under an option which expires January 8, 2003
     at an exercise price of $3.75 per share and 57,500 shares issuable under an
     option which  expires  October 4, 2006,  at an exercise  price of $5.25 per
     share and 35,000 shares  issuable under an option which expires  January 6,
     2009 at an exercise price of $4.75 per share.

(12) The  shares of Artra  Common  Stock  beneficially  owned by Mr.  Santacrose
     consist  of  10,000  shares  owned by him  directly,  1,055  shares  in his
     individual retirement account, 10,000 shares issuable under an option which
     expires  January 6, 2009 at an exercise  price of $4.75 per share and 2,500
     shares  issuable  under an  option  which  expires  February  1, 2009 at an
     exercise price of $5.375 per share.

(13) The shares of Artra Common Stock  beneficially owned by Mr. Tull consist of
     22,643 shares held directly by him,  10,000 shares issuable under an option
     which expires  January 6, 2009 at an exercise  price of $4.75 per share and
     2,500 shares issuable under an option which expires  February 1, 2009 at an
     exercise price of $5.375 per share.


Item 13.      Certain Relationships and Related Transactions

John Harvey and Peter Harvey

         The Harvey Family Trust is the owner of the real estate at 500 Central,
Northfield,  Illinois,  the corporate offices of Artra which was acquired by the
Trust in September 1996. Artra rents  approximately  7,000 square feet of office
space and  1,000  square  feet of  warehouse  space  from the trust at an annual
rental of $126,000 pursuant to a lease expiring in January 1999. Artra may renew
the lease for an additional  one-year  period at an increased rent in the sum of
$132,000.  The building contains  approximately 29,500 total square feet. In the
opinion of Artra's management, the Artra rental obligation to the trust does not
exceed the fair market value for similar rentals. John Harvey is the grantor and
beneficiary of the trust. John Harvey and Peter R. Harvey are brothers.

         In June 1996,  Peter R. Harvey  loaned  Artra  100,000  shares of Artra
Common Stock, which had a then fair market value of $587,000.  Artra principally
issued  these  shares  to  certain  lenders  as  additional   consideration  for
short-term  loans. In September  1996,  after Artra's  shareholders  approved an
increase in the number of authorized  common shares,  Artra repaid this loan. At
Peter R. Harvey's direction, the 100,000 shares of Artra




                                                      


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<PAGE>




Common  Stock were issued in blocks of 25,000  shares to the four  daughters  of
John Harvey.

         In March  1998,  the Artra  Board of  Directors  ratified a proposal to
settle  Peter  R.  Harvey's  previous  advances  from  Artra  in the  amount  of
$15,437,000 as follows:

         (a)  Effective  December  31,1997,  Peter R. Harvey's net advances from
Artra were offset by $2,816,000 ($5,606,000 net of interest accrued and reserved
for the period  1993- 1997) to  $12,621,000.  This  offset of Peter R.  Harvey's
advances  represented a combination of compensation for prior year guarantees of
Artra obligations to private and institutional  lenders,  compensation in excess
of the nominal  amounts  Peter R. Harvey  received for the years  1995-1997  and
reimbursement for expenses incurred to defend Artra against certain litigation.

         (b) Effective  January 31, 1998, Peter R. Harvey's  remaining  advances
totaling  $12,787,000 were paid with  consideration  consisting of the following
Artra Series A Preferred  Stock and BCA Holdings  Inc.  preferred  stock held by
Peter R. Harvey:


                                                               Face Value Plus
                        Security                              Accrued Dividends
                        --------                              -----------------
   Artra Series A Preferred Stock, 1,734.28 shares               $ 2,751,000
   BCA Holding Series A Preferred Stock, 1,784.029 shares          2,234,000
   BCA Holding Series B Preferred Stock, 6,172 shares              7,802,000
                                                                 $12,787,000

         For additional  related-party  transactions  between Artra and Peter R.
Harvey, see Note 16 to the consolidated  financial statements for the year ended
December 31, 1998.

         On September 27, 1989,  Artra received a proposal to purchase  Bagcraft
from Sage Group, Inc., a privately-owned corporation. Effective March 3, 1990, a
wholly-owned  subsidiary of Artra indirectly acquired from Sage Group, Inc. 100%
of the issued and outstanding common shares of BCA Holdings, Inc., which in turn
owned 100% of the stock of Bagcraft, for total consideration which was delivered
to Ozite as the successor by merger to Sage Group, Inc. upon approval of Artra's
shareholders.  The  consideration  for the  Bagcraft  acquisition  consisted  of
772,000  shares  of Artra  Common  Stock  and  3,750  shares  of Artra  Series A
Preferred  Stock,  its $1,000 par value junior  non-convertible  payment-in-kind
preferred  stock bearing a dividend rate of 6%. The issuance of the Artra Common
Stock and Artra  Series A  Preferred  Stock as  consideration  was  approved  by
Artra's  shareholders at the December 1990 annual meeting of shareholders.  Upon
the merger of Sage  Group,  Inc.  into Ozite on August 24,  1990,  Ozite  became
entitled to receive this  consideration,  which right Ozite  assigned to its PST
subsidiary.  Peter R. Harvey and John Harvey were the principal  shareholders of
Sage Group, Inc. and Ozite as of the times that the merger agreements were




                                                      

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<PAGE>




executed and the mergers consummated.  Ozite subsequently  repurchased the 3,750
shares of Artra Series A Preferred Stock in February 1992, of which 1,523 shares
were subsequently  assigned to Peter R. Harvey in consideration of his discharge
of certain  indebtedness of Ozite to him in April 1992.  Peter R. Harvey pledged
these 1,523 shares of Artra Series A Preferred Stock preferred  shares to Artra.
The  $4,750,000  price of the  772,000  shares of Artra  Common  Stock and 3,750
shares Artra Series A Preferred Stock was equal to the fair market value thereof
as of January 31, 1991 as determined by an independent  investment  banking firm
engaged by PST to make such determination.  In November, 1998, substantially all
of the assets of Bagcraft were sold to Packaging Dynamics LLC, the parent entity
of Bagcraft Packaging LLC.

         Peter R. Harvey and John Harvey were significant  shareholders of PST's
parent, PureTec. Peter R. Harvey formerly was a Vice President and a director of
PST and a director of PureTec.  John Harvey  formerly  was a director of PST and
PureTec.


Gerald M. Kenny

         During 1986 and through August 10, 1988, Artra entered into a series of
short-term borrowing  agreements with private investors.  Each agreement granted
an investor a put option,  principally  due in one year,  that required Artra to
repurchase  any or all of the  shares  sold  at a 15% to 20%  premium  during  a
specified put period.

         Kenny  Construction   Company  ("Kenny")  entered  into  a  put  option
agreement with Artra,  which has been extended from time to time,  most recently
on  November  11,  1992.  At such time Artra and Kenny  agreed to extend the put
option  whereby Kenny received the right to sell to Artra 23,004 shares of Artra
Common  Stock at a put price of $56.76 plus an amount equal to 15% per annum for
each day from March 1, 1991 to the date of payment  by Artra,  which  option was
scheduled to expire on December 31, 1997.  Gerard M. Kenny, a director of Artra,
is the Executive  Vice-President  and Chief Executive  Officer and a director of
Kenny  Construction  Company and  beneficially  owns  16.66% of Kenny's  capital
stock.

         On March 21,  1989,  Artra  borrowed  $5,000,000  from its bank  lender
evidenced by a  promissory  note.  This note has been amended and extended  from
time to time.  The borrowings on this note were  collateralized  by, among other
things, a $2,500,000 guaranty by Kenny. Kenny received  compensation in the form
of 833 shares of Artra Common  Stock for each month that its  guaranty  remained
outstanding  through  March 31, 1994.  Under this  arrangement,  Kenny  received
49,980 shares of Artra Common Stock as compensation for its guaranty.

         On March 31, 1994,  Artra entered into a series of agreements  with its
bank lender and with Kenny. Under the terms of these agreements, Kenny purchased
a  $2,500,000  participation  in the  $5,000,000  note  payable to Artra's  bank
lender. Kenny's participation is







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<PAGE>




evidenced by a $2,500,000  Artra note (the "Kenny Note") bearing interest at the
prime rate. As consideration  for its purchase of this  participation,  the bank
lender  released  Kenny  from  its  $2,500,000  loan  guaranty.   As  additional
consideration,  Kenny  received an option to put back to Artra the 49,980 shares
of Artra Common Stock received as  compensation  for its  $2,500,000  Artra loan
guaranty at a price of $15.00 per share.  The put option was subject to increase
at the rate of $2.25 per share per annum ($21.188 at December 26, 1996). The put
option was  exercisable on the later of the date the Kenny Note is repaid or the
date Artra's  obligations  to its bank lender were fully paid.  During the first
quarter of 1996, the $2,500,000  note and related  accrued  interest was paid in
full, principally with the proceeds from additional short-term borrowings.

         In  December  1997,  Kenny  exercised  all of its put options and Artra
repurchased 72,984 shares of Artra Common Stock for cash of $2,379,000.


Edward A. Celano

         In May 1996,  Artra  borrowed  $100,000  from Edward A. Celano,  then a
private investor, evidenced by an unsecured short-term note, due August 7, 1996,
and renewed to February 6, 1997,  bearing  interest at 10%.  The proceeds of the
loan were used for working  capital.  At Artra's annual meeting of shareholders,
held August 29,  1996,  Mr.  Celano was elected to Artra's  board of  directors.
Effective  January 17, 1997,  Mr.  Celano  exercised his  conversion  rights and
received 18,182 shares of Artra Common Stock as payment of the principal balance
of his note.


Howard Conant

         In August 1996,  Artra  borrowed  $500,000 from Howard  Conant,  then a
private  investor,  evidenced  by an  short-term  note,  due  December 23, 1996,
bearing  interest  at 10%.  The loan was  collateralized  by  125,000  shares of
COMFORCE  common  stock  owned by Artra's  Fill-Mor  subsidiary.  As  additional
compensation  for the loan, Mr. Conant received a warrant,  expiring in 2001, to
purchase 25,000 shares of Artra Common Stock at a price of $5.00 per share.  The
proceeds of the loan were used for working capital. At Artra's annual meeting of
shareholders,  held August 29, 1996,  Mr. Conant was elected to Artra's board of
directors.  In December 1996, the loan was extended until April 23, 1997 and Mr.
Conant received,  as additional  compensation,  a warrant,  expiring in 2001, to
purchase 25,000 shares of Artra Common Stock at a price of $5.875 per share.

         In January 1997, Artra borrowed an additional  $300,000 from Mr. Conant
evidenced by a short-term  note, due December 23, 1997,  bearing interest at 8%.
The loan was  collateralized by 100,000 shares of COMFORCE common stock owned by
Artra's Fill-Mor subsidiary. As additional compensation for the loan, Mr. Conant
received a warrant,  expiring in 2002, to purchase 25,000 shares of Artra Common
Stock at a price of $5.75 per share.




                                                      


                                      -13-

<PAGE>





         In March 1997, Artra borrowed an additional  $1,000,000 from Mr. Conant
evidenced by a short-term  note, due May 26, 1997,  bearing interest at 12%. The
loan was  collateralized  by 585,000  shares of COMFORCE  common  stock owned by
Artra's Fill-Mor subsidiary. As additional compensation,  Mr. Conant received an
option to  purchase  25,000  shares of  COMFORCE  common  stock owned by Artra's
Fill-Mor  subsidiary  at a price of $4.00 per  share,  with the right to put the
option back to Artra on or before May 30, 1997 for a total put price of $50,000.
In May 1997, Mr. Conant exercised his rights and put the COMFORCE option back to
Artra for  $50,000.  The  proceeds  from this loan were used in part to repay an
Artra/Fill-Mor $2,500,000 bank term loan.

         In April 1997, Artra borrowed $5,000,000 from Mr. Conant evidenced by a
note, due April 20, 1998,  bearing interest at 10%. As additional  compensation,
Mr. Conant  received a warrant to purchase  333,333 shares of Artra Common Stock
at a price of $5.00 per share. Mr. Conant had the right to put this warrant back
to Artra at any time during the period April 21, 1998 to April 20,  2000,  for a
total purchase price of $1,000,000.  In May 1998, Mr. Conant sold the warrant to
an unrelated  third party who put the warrant back to Artra for a total purchase
price of $1,000,000. The proceeds from this loan were used to repay Mr. Conant's
outstanding   borrowings  of  $1,800,000  and  to  pay  down  other  Artra  debt
obligations.

         In June 1997, Artra borrowed an additional  $1,000,000 from Mr. Conant,
due December 10, 1997, bearing interest at 12%. As additional compensation,  Mr.
Conant  received a warrant to purchase  40,000 shares of Artra Common Stock at a
price of $5.00 per share.  Mr.  Conant had the right to put this warrant back to
Artra at any time during the period  December 10, 1997 to June 10,  1998,  for a
total  purchase  price of $80,000,  and Mr. Conant put the warrant back to Artra
for  $80,000 in 1998.  The  proceeds  from this loan were used to pay down other
Artra debt obligations. In July 1997, borrowings from Mr. Conant were reduced to
$3,000,000  with  proceeds  advanced  to  Artra  from a  Bagcraft  term  loan as
discussed  above.  In December 1997,  borrowings from Mr. Conant were reduced to
$2,000,000 with proceeds from other short-term  borrowings.  The borrowings from
Mr. Conant were  collateralized  by 490,000  shares of COMFORCE  common stock by
Artra's Fill- Mor subsidiary.

         In August 1998 Artra  borrowed an additional  $500,000 from Mr. Conant,
due December 20, 1998, bearing interest at 15%. As additional compensation,  the
lender  received a warrant to purchase  20,000 shares of Artra Common Stock at a
price of $3.9375 per share.  The  proceeds  from this loan were used to pay down
other Artra debt obligations.

         In  November  1998,  all  borrowings  from Mr.  Conant were repaid with
proceeds from the sale of the business assets of Bagcraft.






                                                      



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<PAGE>








                                    SIGNATURE

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.




                                     ARTRA GROUP INCORPORATED



                                     By: /s/ James D. Doering
                                         --------------------------------------
                                         James D. Doering, Vice President,
                                         Treasurer and Chief Financial Officer





























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