COMFORCE CORP
8-K/A, 1996-05-14
COSTUME JEWELRY & NOVELTIES
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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 8-K/A
                                AMENDMENT NO. 1


                             Current Report Pursuant
                          to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934


       Date of Report (Date of Earliest Event Reported): March 1, 1996
                                                         -------------



                              COMFORCE Corporation
              ---------------------------------------------------
             (Exact name of registrant as specified in its charter)



                                    Delaware
                  --------------------------------------------
                  State or Other Jurisdiction of Incorporation




         1-6081                                           36-23262248
 ----------------------                                -----------------
 Commission File Number                                 I.R.S. Employer
                                                       Identification No.



 2001 Marcus Avenue, Lake Success, NY                        11042
 --------------------------------------                    --------
 Address of principal executive offices                    Zip Code

 Registrant's telephone number, including area code:   (516) 352-3200



                                 Not Applicable
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
<PAGE>


Item 7.           Financial Statements and Exhibits
                  ---------------------------------
               
                  On January 18, 1996,  COMFORCE  Corporation  "COMFORCE" or the
                  "Registrant") announced it had entered into a letter of intent
                  to acquire Williams  Communication  Services  ("Williams"),  a
                  privately  owned company  engaged in the  technical  staffing,
                  consulting and outsourcing business. See Registrant's Form 8-K
                  dated January 18, 1996.

                  On  March 1,  1996,  COMFORCE  Global,  Inc.,  a  wholly-owned
                  subsidiary  of  COMFORCE,   executed  a  definitive   purchase
                  agreement  (the  "Purchase   Agreement")   and  completed  the
                  acquisition  of  substantially  all of the assets of  Williams
                  (except for certain current assets retained by Williams),  for
                  consideration  consisting of cash of $2,000,000 and contingent
                  rights to future  payments  based on earnings over a four year
                  period.  The Acquisition of Williams was funded principally by
                  a $2.25 million  revolving  credit facility  established  with
                  Chase Manhattan Bank. See Registrant's Form 8-K dated March 1,
                  1996.

                  The registrant  hereby files this Form 8-K/A,  Amendment No. 1
                  to its Form 8-K  dated  March  1,  1995 to file the  financial
                  statements as required in accordance with Item 7(a)(4) of Form
                  8-K and to file  related pro forma  financial  information  as
                  required in accordance with Item 7(b) of Form 8-K.


                  a)       Financial Statements of Business Acquired

                           Williams Communication  Services Financial Statements
                           at and for the year ended December 31, 1995.

                  (b)      Pro Forma Financial Information

                           Pro forma  Consolidated  Balance Sheet as of December
                           31, 1995 (Unaudited).

                           Pro forma  Consolidated  Statement of Operations  for
                           the year ended December 31, 1995 (Unaudited).
<PAGE>

Item 7(a)               Financial Statements of Business Acquired

  






                      WILLIAMS COMMUNICATION SERVICES, INC.

                              FINANCIAL STATEMENTS,

                 TOGETHER WITH REPORT OF INDEPENDENT ACCOUNTANTS
                   AT AND FOR THE YEAR ENDED DECEMBER 31, 1995





<PAGE>


Table of Contents




                                                                 Pages

Report of Independent Accountants                                   1


Financial Statements:

     Balance Sheet                                                  2

     Statement of Operations and Retained Earnings                  3

     Statement of Cash Flows                                        4

     Notes to Financial Statements                                5 - 7

<PAGE>


Report of Independent Accountants




To the Shareholder

Williams Communication Services, Inc.
Englewood, Florida

We have  audited  the  accompanying  balance  sheet  of  Williams  Communication
Services,  Inc. as of December 31, 1995 and the related statements of operations
and retained  earnings and cash flows for the year then ended.  These  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

We conducted our audit in accordance with generally accepted auditing standards.
Those standards  require that we plan and perform the audit to obtain reasonable
assurance   about  whether  the  financial   statements  are  free  of  material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  financial  position  of  Williams  Communication
Services, Inc. as of December 31, 1995 and the results of its operations and its
cash  flows  for the year  then  ended in  conformity  with  generally  accepted
accounting principles.





COOPERS & LYBRAND L.L.P.



Fort Myers, Florida
May 6, 1996
<PAGE>

Williams Communication Services, Inc.
Balance Sheet
December 31, 1995


                                     ASSETS

CURRENT ASSETS

     Cash and cash equivalents                         $         0
     Accounts receivable                                   599,607
     Unbilled accounts receivable                          173,904
                                                        ----------

        Total current assets                               773,511


PROPERTY AND EQUIPMENT, net                                 25,329
                                                        ----------

        Total assets                                   $   798,840
                                                        ==========



                      LIABILITIES AND STOCKHOLDERS' EQUITY


CURRENT LIABILITIES
     Accounts payable                                  $     1,500
     Accrued liabilities                                    14,486
     Bank overdraft                                         49,313
     Income tax payable                                    326,475
                                                         ---------

        Total current liabilities                          391,774
                                                         ---------


STOCKHOLDERS' EQUITY
     Common stock, 1,000 shares, 
        issued and outstanding, $1 par value                 1,000
     Retained earnings                                     406,066
                                                         ---------

        Total stockholders' equity                         407,066
                                                         ---------

        Total liabilities and stockholders' equity      $  798,840
                                                         =========




The accompanying notes are an integral part of these financial statements.
<PAGE>

Williams Communication Services, Inc.
Statement of Operations and Retained Earnings
year ended December 31, 1995




Sales                                                   $   4,177,871
                                                          -----------

Direct costs and expenses:
     Cost of sales                                          3,021,251
     General and administrative expenses                      450,225
                                                          -----------

        Total direct costs and expenses                     3,471,476
                                                          -----------

        Income before provision for income taxes              706,395

Income tax provision                                          354,056
                                                          -----------

        Net income                                            352,339

Retained earnings, beginning of year                           53,727
                                                          -----------

Retained earnings, end of year                          $     406,066
                                                          ===========





The accompanying notes are an integral part of these financial statements.
<PAGE>

Williams Communication Services, Inc.
Statement of Cash Flows
year ended December 31, 1995



CASH FLOWS FROM OPERATING ACTIVITIES:
     Net income                                                   $   352,339
     Adjustments to reconcile net income to net cash 
          provided by operating activities
        Depreciation                                                      723
        Changes in assets and liabilities
          (Increase) decrease in:
             Accounts receivable                                     (293,361)
             Unbilled accounts receivable                             (68,761)
             Deposits                                                   3,000
             Other assets                                                 240
          Increase (decrease) in:
             Accounts payable                                            (256)
             Accrued liabilities                                      290,692
             Bank overdraft payable                                    49,313
                                                                   ----------
                Net cash provided by operating activities             333,929
                                                                   ----------

CASH FLOWS FROM INVESTING ACTIVITIES:
     Purchase of property and equipment                               (25,299)
                                                                   ----------

CASH FLOWS FROM FINANCING ACTIVITIES
     Repayments of stockholder loan                                  (309,500)
                                                                   ----------

                Net decrease in cash and cash equivalents                (870)

                Cash and cash equivalents at beginning of year            870
                                                                   ----------
 
                Cash and cash equivalents at end of year          $         0
                                                                   ==========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

     Cash paid during the year for interest                       $     1,586
                                                                   ==========

     Cash paid during the year for income taxes                   $    27,580
                                                                   ==========


The accompanying notes are an integral part of these financial statements.
<PAGE>

Williams Communication Services, Inc.
Notes to Financial Statements


  1.   Description of Business:

       Williams   Communications   Services,   Inc.  (the  Company),  a  Florida
       corporation,  provides a wide range of technical and consulting  services
       to communication  clients through the use of personnel who are designers,
       drafters,  engineers,  programmers  and other types of  technicians.  The
       personnel  are  utilized  by the  clients  on a  temporary,  project,  or
       peak-period basis.



  2.   Summary of Significant Accounting Policies:

       Revenue Recognition:  Revenue is recognized at the time such services are
       rendered to the client.

       Accounts Receivable and Unbilled Accounts Receivable: Accounts receivable
       consists of those  amounts due to the  Company for  services  rendered to
       various customers.

       Unbilled accounts  receivable consists of revenues earned and recoverable
       costs for which  billings have not yet been presented to the customers as
       of the balance sheet date.

       Property  and  Equipment:  Property  and  equipment  is recorded at cost.
       Expenditures  for  maintenance  and repairs are charged to  operations as
       incurred.   Expenditures   for   betterments   and  major   renewals  are
       capitalized.  The cost of assets sold or retired and the related  amounts
       of accumulated  depreciation are eliminated from the accounts in the year
       of disposal, with any resulting profit or loss included in income.

       Depreciation of assets have been computed using the straight-line  method
       over the estimated useful lives of the assets.

       Income Taxes:  The Company accounts for income taxes under the provisions
       of Statement of Financial  Accounting  Standards No. 109, "Accounting for
       Income  Taxes" (SFAS No. 109).  Under the asset and  liability  method of
       SFAS No. 109,  deferred tax assets and liabilities are recognized for the
       future tax consequences attributable to differences between the financial
       statement  carrying  amounts of existing assets and liabilities and their
       respective  tax bases and  operating  loss and tax credit  carryforwards.
       Deferred tax assets and  liabilities are measured using enacted tax rates
       expected to apply to taxable income in the years in which those temporary
       differences are expected to be recovered or settled.  Under SFAS No. 109,
       the effect on  deferred  tax assets  and  liabilities  of a change in tax
       rates is  recognized  in income in the period that includes the enactment
       date.

       As of  December  31,  1995,  deferred  tax  assets  and  liabilities  are
       immaterial in amount,  and  management  has elected not to record them in
       the financial statements.

       The provision for income taxes does not bear the normal  relationship  to
       net  income due to the  deductibility  of only a portion of the amount of
       meals reimbursed to employees.
<PAGE>

Notes to Financial Statements, Continued


  2.   Summary of Significant Accounting Policies, continued

       Management's Use of Estimates: The preparation of financial statements in
       conformity  with  generally  accepted   accounting   principles  requires
       management  to make  estimates and  assumptions  that affect the reported
       amounts of assets and liabilities and disclosure of contingent assets and
       liabilities  at the date of the  financial  statements  and the  reported
       amounts of revenues  and expenses  during the  reporting  period.  Actual
       results could differ from those estimates.


  3.   Property and Equipment:

       Property and equipment consisted of the following at December 31, 1995:


                 Office equipment                     $    15,000
                 Furniture and fixtures                     3,342
                 Vehicle                                   25,300
                                                       ----------
                                                           43,642

                 Less accumulated depreciation            (18,313)
                                                       ----------

                                                      $    25,329
                                                       ==========

  
  4.   Concentration of Credit Risk:

       Financial   instruments   which   potentially   subject  the  Company  to
       concentrations of credit risk consist principally of accounts receivable.
       During the normal  course of  business,  the  Company  extends  credit to
       customers located throughout the United States. At December 31, 1995, the
       Company had  approximately  90% or  $699,000  of its billed and  unbilled
       accounts  receivable due from two customers.  The payment history of each
       customer has been considered in determining the need for an allowance for
       doubtful  accounts.  Sales to these  customers  aggregated  approximately
       $3,062,000,  which  represented  approximately 74% of total sales for the
       year ended December 31, 1995. The Company maintains  substantially all of
       its cash investments  with what it believes to be high quality  financial
       institutions.  The Company's investment policy is to limit concentrations
       of credit risk.
<PAGE>

  5.   Income Taxes:

       For the year ended  December 31,  1995,  the  provision  for income taxes
       represents   current  income  taxes.  The  components  of  the  Company's
       provision for income taxes are as follows:


                 Federal            $  302,556

                 State                  51,500
                                     ---------

                                    $  354,056
                                     =========



  6.   Subsequent Event:

       On February 29, 1996, all of the equipment and intangible  assets used in
       the operation of the Company's business were acquired by Comforce Global,
       Inc.





<PAGE>

Item 7(b)               Pro Forma Financial Information

The  following  unaudited  pro forma  condensed  consolidated  balance  sheet at
December 31, 1995 presents the financial position of the Company at December 31,
1995 as if the  acquisition of Williams had been  consummated as of December 31,
1995. The unaudited pro forma condensed consolidated statement of operations for
the year ended December 31, 1995 presents the Company's results of operations as
if the  acquisitions  COMFORCE  Global and Williams had been  consummated  as of
January 1, 1995.

                              COMFORCE Corporation
                             PRO FORMA BALANCE SHEET
                                December 31, 1995
                            (Unaudited in thousands)
<TABLE>
<CAPTION>
                                                                                                      Pro Forma      Pro Forma
                                                                        Historical      Williams     Adjustments   Consolidated
                                                                        ----------      --------     -----------   ------------
<S>                                                                        <C>           <C>           <C>           <C>
Current assets ...............................................                                                       
   Cash ......................................................             $   649                     $  (173)      $       476
   Receivables, including $151 of unbilled revenue ...........               1,754       $   774          (774)(A)         1,754
   Other current assets ......................................                  61                                            61
   Receivable from ARTRA GROUP Incorporated ..................               1,046                                         1,046
                                                                           -------       -------                         -------
                                                                             3,510           774                           3,337
                                                                            
Property, plant and equipment, net ...........................                  90            25           (25)(A)            90
Excess of cost over net assets acquired ......................               4,801                       2,073 (A)         6,874
Other noncurrent assets ......................................                 135                                           135
                                                                           -------       -------       -------           -------
     Total assets ............................................             $ 8,536       $   799       $ 1,101           $10,436
                                                                           =======       =======       =======           =======
Current liabilities
   Notes payable .............................................             $   500                                       $   500
   Revolving credit line due a bank ..........................                                         $ 1,900 (B)         1,900
   Accounts payable ..........................................                  75       $    52           (52)(A)            75
   Accrued expenses ..........................................                 719            14           (14)(A)           719
   Income taxes ..............................................                 214           326          (326)(A)           214
   Liabilties to be assumed by ARTRA GROUP Incorporated,
      and net liabilities of discontinued operations .........               3,699                                         3,699
                                                                           -------       -------        -------          -------
               Total current liabilities .....................               5,207           392          1,508            7,107
                                                                           -------       -------        -------          -------
Noncurrent liabilities to be assumed by 
   ARTRA GROUP Incorporated ..................................                 541                                           541
                                                                           -------                                       -------   
Obligations expected to be settled by 
   the issuance of common stock ..............................                 550                                           550
                                                                           -------                                       ------- 
Commitments and contingencies

Shareholders'  Equity  (Deficit)
  Common stock ...............................................                  92             1            (1)(A)            92
  Additional paid-in capital .................................              95,993                                        95,993
  Accumulated deficit ........................................             (93,847)          406          (406)(A)       (93,847)
                                                                           -------       -------       -------           -------
                                                                             2,238           407          (407)            2,238
                                                                           -------       -------       -------           -------
                                                                           $ 8,536       $   799       $ 1,101           $10,436
                                                                           =======       =======       =======           =======
</TABLE>

Pro forma  adjustments  to the unaudited  condensed  consolidated  balance sheet
consist of:
    
     (A)  Record  acquisition  of  Williams  and related  entries and  eliminate
          Williams assets and liabilities not purchased or assumed.

     (B)  Record  borrowings  under  the  revolving  credit  line  used  for the
          acquisition of Williams.
     
<PAGE>
                              COMFORCE Corporation
                        Pro Forma Statement Of Operations
                      For the Year ended December 31, 1995
                 (Unaudited in thousands, except per share data)

<TABLE>                                               
<CAPTION>                                        
                                                                  COMFORCE                       Pro Forma      Pro Forma
                                                 Historical (A)   GLOBAL (B)  Williams (B)     Adjustments    Consolidated
                                                  ----------       -------      --------        -----------   ------------
<S>                                                  <C>           <C>          <C>                <C>             <C>
Net sales .......................................    $ 2,387       $ 9,568      $ 4,178                            $16,133
                                                     -------       -------      -------                            -------
Costs and expenses:
   Cost of goods sold ...........................      1,818         7,178        3,022                             12,018
   Stock compensation (C) .......................      3,425                                                         3,425
   Selling, general and administrative ..........        823         1,397          450            $   213 (D)       2,883
                                                     -------       -------      -------            -------         -------
                                                       6,066         8,575        3,472                213          18,326
                                                     -------       -------      -------            -------         -------

Operating earnings (loss) .......................     (3,679)          993          706               (213)         (2,193)
                                                     -------       -------      -------            -------         -------
Other income (expense):
   Spectrum corporate management fees (F) .......        --         (1,140)                                         (1,140)
   Interest and other non-operating expense .....       (618)            7                             248 (E)        (363)
                                                     -------       -------      -------            -------         -------
                                                        (618)       (1,133)                            248          (1,503)
                                                     -------       -------      -------            -------         -------

Loss from continuing operations 
   before income taxes ..........................     (4,297)         (140)         706                 35          (3,696)
(Provision)credit for income taxes ..............        (35)           21         (354)                              (368)
                                                     -------       -------      -------            -------         -------
Loss from continuing operations .................    $(4,332)      $  (119)     $   352            $    35         $(4,064)
                                                     =======       =======      =======            =======         =======

Loss per share from continuing operations .......    $  (.95)                                                      $  (.44)
                                                     =======                                                       =======
Weighted average shares outstanding (G) .........      4,596                                                         9,309
                                                     =======                                                       =======
</TABLE>

Pro forma  adjustments  to the  unaudited  condensed  consolidated  statement of
operations:

     (A)  Historical  data  presented  for the  year  ended  December  31,  1995
          includes COMFORCE Global's operations since its acquisition on October
          17, 1995 through  December 31, 1995 and corporate  overhead  costs for
          the entire year ended December 31, 1995.
     (B)  The pro forma data presented for COMFORCE  Global's  operations is for
          the periods prior to its  acquisition  on October 17, 1995, or January
          1, 1995 through October 16, 1995. The period presented for Williams is
          January 1, 1995 through December 31, 1995.
     (C)  Represents a non-recurring compensation charge related to the issuance
          of the 35% common stock interest in the Company pursuant to employment
          or  consulting  agreements  with  certain  individuals  to manage  the
          Company's  entry into and  development of the  telecommunications  and
          computer technical staffing services business.
     (D)  Amortization of goodwill arising from the COMFORCE Global and Williams
          acquisitions.
     (E)  Reverse  interest  expense on notes and other  liabilities  assumed by
          ARTRA,  net of interest  expense on  revolving  line of credit used to
          acquire Williams.
     (F)  Corporate  management  fees  from  COMFORCE  Global's  former  parent,
          Spectrum Information Technologies,Inc.  The amount of these management
          fees may not be representative of costs incurred by COMFORCE Global on
          a stand alone basis.
     (G)  Pro forma weighted average shares  outstanding  includes shares of the
          Company's common stock issued in the private placement that funded the
          COMFORCE  Global  transaction,   shares  issued  for  fees  and  costs
          associated with the COMFORCE  Global  acquisition and shares issued to
          certain individuals to manage the Company's entry into and development
          of the  telecommunications  and computer  technical  staffing services
          business, as if they had been issued on January 1, 1995.
<PAGE>

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 thereunder duly authorized.



                                                       COMFORCE CORPORATION
                                                       --------------------
                                                            Registrant



Dated:  May 13, 1995                                      ANDREW C. REIBEN
- --------------------                                  ------------------------
                                                       Chief Financial Officer



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