ARTRA GROUP INCORPORATED
SUPPLEMENT TO PROSPECTUS DATED OCTOBER 23, 1997
AND SUPPLEMENTS DATED FEBRUARY 19, 1999,
MARCH 9, 1999 AND JUNE 10, 1999
The purpose of this Supplement is to provide the holders of outstanding
warrants to purchase common stock of Artra Group Incorporated with Artra's
understanding of certain registration provisions involving the exercise of the
warrants. As you were previously advised, Artra has entered into an Agreement
and Plan of Merger providing for the merger of Artra and Entrade, Inc. As a
result of the merger, Entrade will become the parent company of Artra and
Artra's shareholders will receive shares of Entrade common stock in exchange for
their Artra shares.
Artra is currently soliciting shareholder approval of the merger at its
1999 annual meeting, which has been scheduled for September 22, 1999. Management
anticipates that, if the merger is approved, the closing of the merger will take
place as soon as practicable thereafter, although we cannot assure you that the
shareholders will approve the merger or that other closing conditions to the
merger will be satisfied.
Under the terms of the merger agreement, Entrade will assume all
outstanding warrants, options and other such rights to purchase Artra common
stock, which will become rights to purchase Entrade common stock after the
merger. Unless Entrade registers the shares of Entrade common stock issuable
upon exercise of the warrants, any post-merger exercise of your warrants would
result in your acquisition of restricted shares of Entrade common stock that you
will not be able to resell publicly until such time as Entrade registers those
shares under the Securities Act of 1933 or at least one year has elapsed after
the exercise date to enable the shares to be sold under the Rule 144 exemption
from registration.
Although we understand that Entrade intends to file a registration
statement relating to the post-merger exercise of your warrants, no assurance
can be given that the registration will occur immediately upon the closing of
the merger, if at all. Therefore, if you exercise your warrants after the merger
occurs but before any Entrade registration statement becomes effective, there is
a risk that you will not be able to resell the shares acquired upon exercise
until the one-year holding period of Rule 144 has elapsed.
If you exercise your warrants before of the merger occurs, you will
receive shares of Artra common stock that have been registered and that will be
converted upon the closing of the merger into registered shares of Entrade
common stock. Please be advised, however, that any resale of these shares by you
would be subject to all other securities laws and regulations governing such
sale.
The warrants have exercise prices ranging from $3.00 to $8.00 per
share. The average of the high and low sales prices of Artra common stock on
August 27, 1999 was $13.62 per share.
This letter is intended for information purposes only, and is not
intended to solicit or encourage you to exercise your warrants. You should
consult with your personal legal and financial advisors prior to considering any
such action.
This Supplement is dated August 30, 1999.
