NOEL GROUP INC, 8-K, 1998-06-22

NOEL GROUP INC
8-K, 1998-06-22
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SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): June 8, 1998

Noel Group, Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)

Delaware 0-1973 13-2649262
- --------------- ----------- ------------------
(State or other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
incorporation)

667 Madison Avenue, New York, New York 10021
-------------------------------------- -----
(Address of principal executive offices) (zip code)

Registrant's Telephone Number, including Area Code: (212) 371-1400

N/A
------------------------------------------------------------
(Former name or former address, if changed since last report)

<PAGE>

ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.

On June 8, 1998, pursuant to a Stock Purchase Agreement of the
same date (the "Purchase Agreement") by and between Brynwood Partners III L.P.
("Brynwood") and Noel Group, Inc. ("Noel"), Noel sold to Brynwood 3,569,755
shares (the "Shares") of the common stock, par value $.01 per share (the "Common
Stock"), of Lincoln Snacks Company ("Lincoln") at a price of $2.00 per share or
$7,139,510 in the aggregate. The purchase price was paid in cash ($4,500,000)
and by delivery of Brynwood's 6% promissory note ($2,639,510), secured by a
pledge of the Shares and payable July 23, 1998. The Shares represent
approximately 56% of Lincoln's outstanding Common Stock. Following the sale of
the Shares to Brynwood, Noel continued to hold 200,000 shares (approximately 3%)
of Lincoln Common Stock (the "Retained Shares").

On June 8, 1998, Noel and Brynwood also entered into an agreement
pursuant to which Noel agreed to sell to Brynwood and Brynwood agreed to
purchase from Noel, at a price of $2.00 per share, all of the Retained Shares
with respect to which Noel does not have outstanding on or before July 23, 1998,
any call options or similar obligations. The sale of any such Retained Shares to
Brynwood is to close not later than July 30, 1998.

The sale was made pursuant to the Plan of Complete Liquidation
and Dissolution adopted by Noel's Board of Directors on May 21, 1996 and
approved by the shareholders at a Special Meeting of Shareholders held on March
19, 1997.

ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.

(a) Financial statements of business acquired. Not Applicable.

(b) Pro forma financial information. No pro forma financial
information is required pursuant to Article 11 of Regulation S-X.

2.1 Plan of Complete Liquidation and Distribution
(incorporated by reference to Exhibit A to the Noel Proxy
Statement for the Special Meeting of Shareholders on
March 19, 1997).

2.2 Stock Purchase Agreement dated June 8, 1998 by and
between Brynwood Partners III L.P. and Noel Group, Inc.

2.3 Letter Agreement dated June 8, 1998 by and between
Brynwood Partners III L.P. and Noel Group, Inc.

2.4 Promissory Note and Pledge Agreement dated June 8, 1998.

</TABLE>

<PAGE>

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.

NOEL GROUP, INC.
(Registrant)

Dated: June 19, 1998 By:/s/ Todd K. West
________________________________
Todd K. West
Vice President-Finance,
Chief Financial Officer,
Secretary and Treasurer

<PAGE>

EXHIBIT INDEX

Exhibit
Number Description
------ -----------
<C> <S>
2.1 Plan of Complete Liquidation and Distribution (incorporated by
reference to Exhibit A to the Noel Proxy Statement for the
Special Meeting of Shareholders on March 19, 1997).

2.2 Stock Purchase Agreement dated June 8, 1998 by and between Brynwood
Partners III L.P. and Noel Group, Inc.

2.3 Letter Agreement dated June 8, 1998 by and between Brynwood Partners III L.P.
and Noel Group, Inc.

2.4 Promissory Note and Pledge Agreement dated June 8, 1998.

</TABLE>

<PAGE>

EXHIBIT 2.2

STOCK PURCHASE AGREEMENT

BY AND BETWEEN

BRYNWOOD PARTNERS III L.P.,

AS THE PURCHASER,

AND

NOEL GROUP, INC.,

AS THE SELLER

Dated: June 8, 1998

<PAGE>

EXECUTION COPY

STOCK PURCHASE AGREEMENT dated as of the 8th the day of June,
1998 (this "Agreement"), between BRYNWOOD PARTNERS III L.P., a Delaware limited
partnership (the "Purchaser") and NOEL GROUP, INC., a Delaware corporation (the
"Seller").

RECITALS:

WHEREAS, the Seller is the beneficial and record owner of
3,569,755 shares of common stock, par value $.01 per share, of Lincoln Snacks
Company (the "Company", such shares being the "Company Shares"), and desires to
sell the Company Shares to the Purchaser in accordance with the terms hereof;

WHEREAS, the Purchaser desires to purchase the Company Shares
from the Seller in accordance with the terms hereof;

NOW, THEREFORE, in consideration of the premises and of the
mutual covenants, representations and agreements contained in this Agreement,
the parties hereto agree as follows:

ARTICLE I.

PURCHASE AND SALE OF THE SHARES

SECTION 1.1. Transfer of Shares; Consideration.

(a) Upon the terms and subject to the conditions hereof,
on the date hereof the Seller is selling, assigning and delivering to the
Purchaser the Company Shares free and clear of all options, pledges, security
interests, liens, mortgages, claims, debts, charges, voting agreements, voting
trusts or other encumbrances or restrictions on transfer of any kind whatsoever
(collectively, the "Encumbrances").

(b) Upon the terms and subject to the conditions hereof,
on the date hereof the Purchaser is purchasing and accepting the Company Shares
and paying and delivering the Purchase Price (as hereafter defined).

SECTION 1.2. The Closing. The transfer of the Company Shares and
the consummation of the transactions contemplated by this Agreement (the
"Closing") is occurring simultaneously with the execution and delivery of this
Agreement by the parties hereto.

<PAGE>

(a) At the Closing, the Seller is delivering to the
Purchaser:

(i) the Company Shares, properly endorsed for
transfer or accompanied by duly executed stock powers, in either case in blank
or in the name of the Purchaser; and

(ii) an opinion of Morrison & Foerster LLP,
counsel to the Seller, in substantially the form attached hereto as Exhibit A.

(b) At the Closing, the Purchaser is delivering to the
Seller:

(i) an amount equal to $2.00 per Company Share for
a total aggregate amount of $7,139,510 (the "Purchase Price"), payable as
follows: (A) $2,639,510 by a secured promissory note of the Purchaser in the
form attached hereto as Exhibit B (the "Promissory Note"), and (B) $4,500,000 by
wire transfer of same day funds to an account designated by the Seller; and

(ii) an opinion of Cummings & Lockwood, counsel to
the Purchaser, in substantially the form attached hereto as Exhibit C.

SECTION 1.3. Seller Release. Effective as of the Closing Date,
the Seller hereby forever releases and discharges the Company from any and all
claims of such Seller against the Company or liabilities or obligations of the
Company to such Seller as a result of such Seller's having been a stockholder of
the Company, whether known or unknown, past or present.

SECTION 1.4. Payment of Expenses. Each party shall be obligated
to pay for any and all fees and expenses of its counsel and accountants and all
other costs and expenses incurred, directly or indirectly, by or on behalf of
such party in the preparation, negotiation, execution and delivery of this
Agreement and the consummation of the transactions contemplated herein.

ARTICLE II.

REPRESENTATIONS AND WARRANTIES OF THE SELLER

The Seller hereby represents and warrants to the Purchaser, as of
the date hereof (except as to any representation or warranty which specifically
relates to another date) as follows:

SECTION 2.1. Share Ownership. The Company Shares have been duly
authorized, validly issued and are fully paid and nonassessable, and are owned
of record and beneficially by the Seller, free and clear of all Encumbrances.

<PAGE>

SECTION 2.2. Company Reports.

(a) In connection with the representations and warranties
contained in this Section 2.2, Seller has informed the Purchaser (and Purchaser
hereby acknowledges) that: (i) no officer, director or representative of Seller
serves as an officer or director of the Company, (ii) Seller is not familiar
with the operations of the Company, (iii) Seller does not independently verify
financial and other information received from or concerning the Company, and
(iv) in connection with such representations and warranties Seller has made no
independent investigation of any factual matter.

(b) Subject to the foregoing subsection of this Section
2.2, to the best knowledge of Seller, the Company's Annual Report on Form 10-K
for the fiscal year ended June 30, 1997 and its Quarterly Reports on Form 10-Q
for the periods ended September 30, 1997, December 31, 1997 and March 31, 1998
(collectively, the "Company Reports") did not as of the respective dates thereof
contain any untrue statement of a material fact, nor omit to state a material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and without independent investigation, Seller has no knowledge of
any material adverse developments affecting the Company since March 31, 1998.
For purposes of this Section 2.2, the term "knowledge" is confined to the actual
knowledge of officers of the Seller.

(c) To the knowledge of Seller, since March 31, 1998, the
business of the Company has been conducted in the ordinary course, consistent
with past practice.

(d) Except for the representations and warranties made in
this Section 2.2, Seller makes and has made no representations or warranties
concerning the Company Shares or the business, financial condition, operations
or prospects of the Company. Without limiting the generality of the foregoing,
Seller makes no representations or warranties as to the existence or effect of
any employment, severance or other agreements that may require payments to be
made as a result, directly or indirectly, of the transactions contemplated by
this Agreement.

SECTION 2.3. Organization and Authorization. The Seller is a
corporation validly existing and in good standing under the laws of its
jurisdiction of organization. The Seller has the full power, authority and legal
right to execute, deliver and carry out the terms and conditions of this
Agreement and to sell the Company Shares to the Purchaser, and has taken all
necessary corporate action to authorize the execution, delivery and performance
of this Agreement. This Agreement has been duly and validly executed and
delivered by the Seller, and constitutes the legal, valid and binding obligation
of the Seller, enforceable against the Seller in accordance with its terms.

<PAGE>

SECTION 2.4. No Violation. The execution of this Agreement by the
Seller does not, and the performance by the Seller of its obligations hereunder
will not constitute a violation of, or conflict with or result in a default
under: (i) any contract, commitment, agreement, understanding, arrangement or
restriction of any kind, whether written or oral, to which the Seller is a party
or by which the Seller is bound, (ii) any judgment, decree or order applicable
to the Seller, or (iii) the Seller's certificate of incorporation or by-laws.
Neither the execution and delivery of this Agreement nor the performance by the
Seller of its obligations hereunder will violate any provision of law applicable
to the Seller.

SECTION 2.5. Consents and Approvals. No filing or registration
with, no notice to and no permit, authorization, consent or approval of any
third party or any public or governmental body or authority is necessary for the
consummation by the Seller of the transactions contemplated herein.

SECTION 2.6. Brokers' Fees and Commissions. The Seller has not
employed any investment banker, broker, finder or intermediary, and no fee or
other commission is owed by Seller to any third party, in connection with the
transactions contemplated herein.

ARTICLE III.

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

The Purchaser hereby represents and warrants to the Seller and
the Company, as of the date hereof (except as to any representation or warranty
which specifically relates to an earlier date) and as of the Closing Date, as
follows:

SECTION 3.1. Organization and Authorization. The Purchaser is a
limited partnership validly existing and in good standing under the laws of its
jurisdiction of organization. The Purchaser has the full power, authority and
legal right to execute, deliver and carry out the terms and conditions of this
Agreement and to purchase the Company Shares from the Seller, and has taken all
necessary action to authorize the execution, delivery and performance of this
Agreement. This Agreement and the Promissory Note have been duly and validly
executed and delivered by the Purchaser, and constitute the legal, valid and
binding obligation of the Purchaser, enforceable against the Purchaser in
accordance with its terms.

SECTION 3.2. No Violation. The execution of this Agreement by the
Purchaser does not, and the performance by the Purchaser of its obligations
hereunder (including the payment of the Promissory Note in accordance with its
terms) will not constitute a violation of, or conflict with or result in a
default under: (i) any contract, commitment, agreement, understanding,
arrangement or restriction of any kind, whether

<PAGE>

written or oral, to which the Purchaser is a party or by which the Purchaser or
its properties or assets is bound, (ii) any judgment, decree or order applicable
to the Purchaser, or (iii) the Purchaser's articles of partnership or agreement
of limited partnership. Neither the execution and delivery of this Agreement nor
the performance by the Purchaser of its obligations hereunder will violate any
provision of law applicable to the Purchaser.

SECTION 3.3. Consents and Approvals. No filing or registration
with, no notice to and no permit, authorization, consent or approval of any
third party or any public or governmental body or authority is necessary for the
consummation by the Purchaser of the transactions contemplated herein.

SECTION 3.4. Acquisition of Stock. Purchaser is an accredited
investor (as that term is defined in the Securities Act of 1933, as amended (the
"Act"), and the regulations thereunder), and Purchaser has such knowledge and
experience in financial and business matters as is required for evaluating the
merits and risks of an investment in the Company Shares. Purchaser is aware that
the Company Shares have not been registered under the Act and agrees that such
Company Shares shall not be sold, hypothecated or otherwise transferred in the
absence of such registration unless such contemplated transfer is exempt from
the registration requirements of the Act. The undersigned hereby acknowledges
that the certificate representing the Company Shares may be legended to reflect
such restrictions. The Purchaser is acquiring the Company Shares for its own
account and not with a view to the distribution or resale thereof and with a
present intention of holding the Company Shares for purposes of investment.

SECTION 3.5. Brokers' Fees and Commissions. The Purchaser has not
employed any investment banker, broker, finder or intermediary, and such no fee
or other commission is owed by Purchaser to any third party, in connection with
the transactions contemplated herein.

ARTICLE IV.

COVENANTS

SECTION 4.1. All Reasonable Efforts. Subject to the terms and
conditions herein provided, each of the parties hereto agrees to use all
reasonable efforts to take, or cause to be taken, all action, and to do, or
cause to be done as promptly as practicable, all things necessary, proper and
advisable under applicable laws and regulations to consummate and make effective
the transactions contemplated by this agreement. If at any time after the
Closing any further action is necessary or desirable to carry out the purposes
of this Agreement, including, without limitation, the execution of additional
instruments, the proper officers and directors of the Purchaser, and the Seller
shall take all such necessary action.

<PAGE>

SECTION 4.2. Public Announcements. The Purchaser and the Seller
will consult with each other and will mutually agree upon the content and timing
of any press release or other public statements with respect to the transactions
contemplated by this Agreement and shall not issue any such press release or
make any such public statement prior to such consultation and agreement, except
as may be required by applicable law or based upon the advice of counsel that
such disclosure would be prudent under applicable securities laws.

ARTICLE V.

SURVIVAL AND INDEMNIFICATION

SECTION 5.1. Survival. All representations, warranties, covenants
and agreements contained in this Agreement, and in any certificate, schedule,
document or other writing delivered pursuant hereto or in connection with the
transactions contemplated herein shall be in all cases deemed to have been
relied upon by the parties hereto, and shall survive the Closing; provided that
any such representations, warranties, covenants and agreements shall be fully
effective and enforceable only for a period of twelve months after the Closing,
and shall thereafter be of no further force or effect, except that the
representations and warranties set forth in Section 2.1 (Share Ownership) shall
survive indefinitely. The representations, warranties, covenants and agreements
contained in this Agreement or any certificate, schedule, document or other
writing delivered pursuant hereto shall not be affected by any investigation,
verification or examination by any party hereto or by any person acting on
behalf of any such party.

SECTION 5.2. Indemnification of the Purchaser. From and after the
Closing, the Seller agrees to indemnify, defend and save the Purchaser and its
directors, officers, employees, owners, agents and affiliates and their
successors and assigns or heirs and personal representatives, as the case may be
(each a "Purchaser Indemnified Party"), forever harmless from and against, and
to promptly pay to a Purchaser Indemnified Party or reimburse a Purchaser
Indemnified Party for any and all losses, damages, expenses (including, without
limitation, court costs, amounts paid in settlement, judgments, reasonable
attorneys' fees or other expenses for investigating and defending, including,
without limitation, those arising out of the enforcement of this Agreement),
suits, actions, claims, deficiencies, liabilities or obligations (collectively,
the "Losses") sustained or incurred by such Purchaser Indemnified Party relating
to, caused by or resulting from any misrepresentation or breach of warranty, or
failure to fulfill or satisfy any covenant or agreement made by the Seller
contained herein or in any certificate, schedule, document or other writing
delivered by the Seller pursuant hereto or any covenant or agreement made by the
Seller herein or in any certificate, schedule, document or other writing
delivered by the Seller pursuant hereto.

<PAGE>

SECTION 5.3. Indemnification of the Seller. From and after the
Closing, the Purchaser agrees to indemnify, defend and save the Seller and its
respective legal representatives, heirs, successors, assigns, agents and
affiliates (each, a "Seller Indemnified Party") forever harmless from and
against, and to promptly pay to a Seller Indemnified Party or reimburse a Seller
Indemnified Party for, any and all Losses sustained or incurred by such Seller
Indemnified Party relating to, caused by or resulting from any misrepresentation
or breach of warranty, or failure to fulfill or satisfy any covenant or
agreement made by the Purchaser contained herein or in any certificate,
schedule, document or other writing delivered by the Purchaser pursuant hereto,
or any covenant or agreement made by the Purchaser in any certificate, schedule,
document or other writing delivered by the Purchaser pursuant hereto.

SECTION 5.4. Notice of Claims. In the case of a claim for
indemnification under Section 5.2 or Section 5.3 hereof, upon determination by a
Purchaser Indemnified Party or a Seller Indemnified Party, as the case may be,
that it has a claim for indemnification, the Indemnified Party shall deliver
notice of such claim to the Indemnifying Party, setting forth in reasonable
detail the basis of such claim for indemnification (each, an "Indemnification
Notice"). [Upon the Indemnification Notice having been given to the Indemnifying
Party, the Indemnifying Party shall have thirty (30) days in which to notify the
Indemnified Party in writing (the "Dispute Notice") that the amount of the claim
for indemnification is in dispute, setting forth in reasonable detail the basis
of such dispute. In the event that a Dispute Notice is not given to the
Indemnified Party within the required thirty (30) day period the Indemnifying
Party shall be obligated to pay to the Indemnified Party the amount set forth in
the Indemnification Notice within sixty (60) days after the date that the
Indemnification Notice had been given to the Indemnifying Party.]

In the event that a Dispute Notice is timely given to an
Indemnified Party, the parties hereto shall have thirty (30) days to resolve any
such dispute. In the event that such dispute is not resolved by such parties
within such period, the parties shall have the right to pursue all available
legal remedies to resolve such dispute.

ARTICLE VI.

MISCELLANEOUS PROVISIONS

SECTION 6.1. Amendment and Modification; Waiver of Compliance.
The Purchaser, on the one hand, or the Seller, on the other hand, will not be
deemed as a consequence of any act, delay, failure, omission, forbearance or
other indulgence granted from time to time by such party: (i) to have waived, or
to be estopped from exercising, any of its rights or remedies under this
Agreement; or (ii) to have modified, changed, amended, terminated, rescinded, or
superseded any of the terms of this Agreement, unless such

<PAGE>

waiver, modification, amendment, change, termination, rescission, or suppression
is set forth in writing and signed by the party to be bound thereby. No single
or partial exercise by the Purchaser, on the one hand, or the Seller, on the
other hand, of any right or remedy will preclude any other right or remedy, and
a waiver expressly made in writing on one occasion will be effective only in
that specific instance and only for the precise purpose for which given, and
will not be construed as a consent to or a waiver of any right or remedy on any
future occasion or a waiver of any right or remedy against any other party.

SECTION 6.2. Parties in Interest. This Agreement shall be binding
upon and inure solely to the benefit of each party hereto, and nothing in this
Agreement, expressed or implied, is intended to confer upon any other person any
rights or remedies of any nature whatsoever under or by reason of this
Agreement.

SECTION 6.3. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given upon the earlier to
occur of delivery thereof if by hand or upon receipt if sent by mail (registered
or certified mail, postage prepaid, return receipt requested) or on the second
next business day after deposit if sent by a recognized overnight delivery
service or upon transmission if sent by telecopy or facsimile transmission (in
each case with receipt verified) as follows:

(a) If to the Purchaser:

Brynwood Partners III L.P.
Two Soundview Avenue
Greenwich, CT 06830
Attention: Hendrik J. Hartong, Jr. and
John T. Gray
Telephone: (203) 622-8223
Facsimile: (203) 622-9334

With a copy to:

Katherine P. Burgeson, Esq.
Cummings & Lockwood
Four Stamford Plaza
107 Elm Street
Stamford, Connecticut 06904-0120
Telephone: (203) 351-4260
Facsimile: (203) 351-4499

(b) if to the Seller:

<PAGE>

Noel Group, Inc.
667 Madison Avenue
New York, New York 10021
Attention: Stanley R. Rawn, Jr. and
Herbert M. Friedman, Esq.
Facsimile: (212) 758-8531

With a copy to:

Charles B. Friedman, Esq.
Morrison & Foerster LLP
1290 Avenue of the Americas
New York, NY 10104
Facsimile: (212) 468-7900

; and provided that each of the parties hereto shall promptly notify the other
parties hereto of any change of address, which address shall become such party's
address for the purposes of this Section 8.4.

SECTION 6.4. Governing Law; Consent to Jurisdiction. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without regard to the conflicts-of-laws principles thereof.
Each of the Company and the Seller hereby irrevocably (a) submits to the
jurisdiction of, and agrees that any action, suit or other proceeding shall be
brought in, the courts of, or the Federal Court sitting in, the State of New
York for the purpose of any such suit, action or other proceeding arising out of
or based upon this Agreement or the transactions contemplated herein, (b) waives
to the extent not prohibited by applicable law, rule or regulation, and agrees
not to assert, by way of motion, as a defense or otherwise, in any such action,
suit or other proceeding any claim that any such person is not subject
personally to the jurisdiction of the aforementioned courts, that its respective
property is exempt or immune from attachment or execution, that any such suit,
action or other proceeding brought in one of the aforementioned courts is
brought in an inconvenient forum, that the venue of any such suit, action or
other proceeding brought in one of the aforementioned courts is improper, or
that this Agreement, or the transactions contemplated herein may not be enforced
in or by such court, and (c) consents to service of process in any such suit,
action or other proceeding by registered or certified mail.

SECTION 6.5. Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same agreement.

<PAGE>

SECTION 6.6. Headings. The article and section headings contained
in this Agreement are solely for the purpose of reference, are not part of the
agreement or understanding of the parties hereto and shall not affect in any way
the meaning or interpretation of this Agreement.

SECTION 6.7. Entire Agreement. This Agreement and the other
documents and instruments referred to herein, and the other agreements included
in or contemplated by the exhibits hereto (the "Other Agreements") embody the
entire agreement and understanding of the parties hereto in respect of the
subject matter contained herein or therein. There are no agreements,
representations, warranties or covenants other than those expressly set forth or
referred to herein or therein. This Agreement and the Other Agreements supersede
all prior agreements and understandings between the parties hereto, whether
written or oral, express or implied, with respect to such subject matter herein
and therein.

SECTION 6.8. Assignment. This Agreement shall not be assigned by
operation of law or otherwise. Subject to the foregoing, this Agreement will be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors and permitted assigns.

IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed on its behalf by its duly authorized officers or
representatives, as the case may be, all as of the day and year first above
written.

BRYNWOOD PARTNERS III L.P.
By BRYNWOOD MANAGEMENT III L.P.
Its General Partner

________________________________________
Hendrik J. Hartong, Jr.
A General Partner of
Brynwood Management III L.P.

NOEL GROUP, INC.

By:_____________________________________

<PAGE>

EXHIBIT 2.3

NOEL GROUP, INC.
667 MADISON AVENUE
NEW YORK, NY 10021

June 8, 1998

Brynwood Partners III L.P.
Two Soundview Avenue
Greenwich, CT 06830

Ladies/Gentlemen:

This will confirm our agreement as to terms pursuant to which
Brynwood Partners III L.P. ("Brynwood") has agreed that Noel Group, Inc.
("Noel") shall have the right to sell to Brynwood, and if Noel exercises such
right, that Brynwood will purchase from Noel, up to 200,000 shares of the common
stock, par value $.01 per share (the "Shares"), of Lincoln Snacks Company (the
"Company").

1. At any time and from time to time on or prior to July 23,
1998, Noel may give written notice to Brynwood that Noel desires to sell some or
all of the Shares to Brynwood, which notice (the "Exercise Notice") shall
specify the number of Shares to be sold (the "Exercised Shares") and the closing
date for such sale, which date (the "Closing Date") shall be on the later to
occur of (i) July 23, 1998, or (ii) five business days following delivery of the
Exercise Notice to Brynwood. Noel agrees that it shall sell to Brynwood all such
Shares that Noel holds on such date and with respect to which Noel does not then
have outstanding any call options or similar obligations.

2. The purchase price for the shares shall be $2.00 per share,
payable in cash on the Closing Date by wire transfer of same day funds to an
account designated by Noel.

3. On the Closing Date, Noel shall deliver the Exercised Shares
to Brynwood and Brynwood shall pay the purchase price to Noel.

4. Except as otherwise specified herein, the terms of the sale
and purchase of the Shares shall be those terms set forth in the Stock Purchase
Agreement dated as of this date entered into between Noel and Brynwood relating
to shares of Company common stock to the fullest extent as though the Shares
were included in the Company Shares being sold pursuant thereto.

<PAGE>

<PAGE>
Brynwood Partners III L.P.
June 19, 1998
Page Two

If the foregoing correctly sets forth our understanding as to
such matters, kindly so indicate by signing and returning to us a copy of this
letter.

Very truly yours,

NOEL GROUP, INC.

By:_________________________
Name:
Title:

ACCEPTED AND AGREED:

By: BRYNWOOD PARTNERS III L.P.

By: BRYNWOOD MANAGEMENT III L.P.
Its General Partner

By: ____________________________
Hendrik J. Hartong, Jr.
A General Partner of
Brynwood Management III L.P.

<PAGE>

EXHIBIT 2.4

PROMISSORY NOTE
AND PLEDGE AGREEMENT

$2,639,510.00 June 8, 1998

FOR VALUE RECEIVED, BRYNWOOD PARTNERS III L.P., a Delaware
limited partnership ("Maker") hereby promises to pay to the order of NOEL GROUP,
INC., a Delaware corporation, or its assigns (hereinafter called "Payee") the
principal sum of TWO MILLION SIX HUNDRED THIRTY NINE THOUSAND FIVE HUNDRED TEN
DOLLARS ($2,639,510.00) (the "Principal Amount") in lawful money of the United
States of America.

The Principal Amount shall be payable in full, together with
interest on the Principal Amount compounded annually at a rate per annum equal
to 6% on July 23, 1998.

The following additional terms shall govern this Promissory Note
and Pledge Agreement (this "Note"):

1. Principal together with accrued and unpaid interest in respect
of this Note shall be paid in lawful currency of the United States, in
immediately available funds, at the principal executive offices of Payee, 667
Madison Avenue, Suite 2500, New York, New York 10021, or at such other place or
to such other person as Payee may designate in a written notice to Maker.

2. As security for the full, prompt and complete payment of all
principal and interest on this Note, Maker hereby pledges, assigns and grants to
Payee a continuing security interest in the shares of the Common Stock of
Lincoln Snacks Company (the "Shares") acquired by Maker pursuant to the Stock
Purchase Agreement of even date herewith between Maker and Payee (the "Purchase
Agreement"), together with the cash and non-cash proceeds of such Shares, and
hereby assigns to Payee the right to receive all such cash and non-cash
proceeds, including without limitation distributions of cash, securities or
other property in respect of the Shares (such Shares together with all such cash
and non-cash proceeds thereof being hereinafter referred to as the
"Collateral").

3. So long as no Event of Default (as hereinafter defined) has
occurred and is continuing, Maker shall be entitled to exercise any voting or
other rights of ownership in respect of the Collateral not inconsistent with the
terms and provisions hereof.

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4. Any and all cash received by Maker in respect of the
Collateral (whether in respect of dividends or otherwise) shall promptly be paid
over to Payee in prepayment of the indebtedness represented by this Note.

5. Any securities or other property, other than cash, received by
Maker in respect of the Collateral, including without limitation any securities
or other property distributed in respect of the Company Shares or received in
exchange for or in addition to the Collateral pursuant to any merger,
consolidation or dissolution, shall promptly be delivered in pledge to Payee to
be held by Payee as part of the Collateral. Until the repayment in full of all
principal due under this Note, all Proceeds (as defined in Section 9-306(1) of
the Uniform Commercial Code of the State of New York) in respect of the
Collateral received by Maker and not pledged in accordance with this Paragraph
or applied as a prepayment in accordance with Paragraph 4 above shall be deemed
to be held in trust by Maker and as Collateral hereunder for the benefit of
Payee.

6. The obligations of Maker hereunder are absolute and
unconditional and payment of the Principal Amount hereof shall not be subject to
any defense, counterclaim or right of set-off. This is a full recourse Note.

7. Maker hereby represents and warrants that:

a. Immediately following the Closing (as defined in the
Purchase Agreement), and at all times thereafter until all amounts due
under this Note shall have been paid in full, Maker will be the sole
beneficial owner of the Collateral free and clear of all liens, charges
and encumbrances other than those created hereby and that, upon the
deposit and pledge hereunder, Payee has acquired a valid, enforceable
security interest therein and lien thereon;

b. Maker has not granted, and until all amounts due under
this Note have been paid in full Maker will not grant, to any person
other than Payee any interest in the Collateral, whether superior to,
equal to or inferior to the rights of Payee therein; and

c. Neither the execution and delivery of this Note nor
the performance of any of the terms hereof constitute or will constitute
a material breach of or a default under any law, rule, regulation,
contract, agreement or arrangement applicable to Maker.

8. The following shall constitute an "Event of Default" within
the meaning of this Note:

a. Maker shall fail or refuse to make payment in full of
any amount due hereunder when the same shall become due; or

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b. Maker shall default under any material obligation to
any lender of Maker and such lender declares a default or otherwise
accelerates payment against Maker; or

c. (i) Maker shall make a general assignment for the
benefit of its creditors, (ii) the adjudication in bankruptcy of Maker,
(iii) the filing of a voluntary petition by Maker under any of the
provisions of the United States bankruptcy code or similar laws of any
jurisdiction, (iv) the filing of any answer or other pleading admitting
the material allegations of any petition filed against Maker in any
bankruptcy, insolvency or other such proceeding, (v) the filing of a
petition against Maker under any of the provisions of any bankruptcy
laws of the United States or similar laws of any jurisdiction, or (vi)
the petition for, or the appointment of, or possession by, a custodian,
receiver, liquidator, assignee, trustee or sequestrator (or other
similar official) of Maker or any substantial part of its properties or
assets.

9. In the event of and during the continuance of an Event of
Default as defined in Paragraph 8(a) or 8(b), Payee may declare the unpaid
Principal Amount of this Note and all accrued interest hereunder to be
immediately due and payable, and in the event of the occurrence of an Event of
Default as defined in Paragraph 8(c), the unpaid Principal Amount of this Note
and all accrued interest hereunder shall automatically, without any action on
the part of Payee, become immediately due and payable, in each case without
presentment, demand, protest or any notice of any kind, all of which are hereby
waived. Upon the occurrence of an Event of Default, Payee, in addition to any
other rights it may have, shall have the right at any time and from time to time
to sell, resell, assign and deliver, in its discretion, all or any of the
Collateral in one or more parcels at the same or different times, and all right,
title and interest, claim and demand therein and right of redemption thereof, on
any securities exchange on which the Collateral or any of them may be listed, or
at public or private sale, for cash, upon credit or for future delivery. Payee
may purchase all or any of the Collateral being sold. No demand, advertisement
or notice shall be required in connection with any sale or other disposition of
any part of the Collateral which is listed on a recognized securities exchange
or traded in the over-the-counter market and reported in the National
Association of Securities Dealers Automated Quotation System; otherwise Payee
shall give Maker at least twenty (20) calendar days' prior notice of the time
and place of any public sale and of the time after which any private sale or
other disposition is to be made, which notice Maker agrees is reasonable. Payee
may, without notice or publication, adjourn any public or private sale or cause
the same to be adjourned from time to time by announcement at the time and place
fixed for sale, and such sale may, without further notice, be made at the time
and place to which the same was so adjourned. Maker shall pay all reasonable
costs and expenses of every kind for sale or delivery, including brokers' and
attorneys' fees, and after deducting such costs and expenses from the proceeds
of sale, Payee shall apply any residue to the payment of the indebtedness or
obligations of Maker under this Note, and Maker shall

<PAGE>

continue to be liable for any deficiency. The balance, if any, remaining after
payment in full of all of such indebtedness shall be paid to Maker, subject to
any duty of Payee imposed by law to the holder of any subordinate security
interest in the Collateral known to Payee. Payee, in addition to all other
rights or remedies which it may have, shall have all of the rights and remedies
of a secured party upon default under the Uniform Commercial Code of the State
of New York and under any other applicable law. Payee may exercise any or all of
the rights which it may have in the premises in any order, from time to time,
and shall not be obligated to exercise any of such rights. No failure to
exercise any right shall operate as a waiver and no waiver, consent or agreement
given in any instance shall adversely effect the rights of Payee in any other
instance.

10. Maker recognizes that Payee may be unable to effect a public
sale of all or a part of the Collateral by reason of certain prohibitions
contained in the Securities Act of 1933, as amended, or in applicable Blue Sky
or other state securities laws, as now or hereafter in effect, but may be
compelled to resort to one or more private sales to a restricted group of
purchasers who will be obliged to agree, among other things, to acquire such
Collateral for their own account, for investment and not with a view to the
distribution or resale thereof. Maker agrees that private sales so made may be
at prices and other terms less favorable to the seller than if such Collateral
were sold at public sales, and that Payee has no obligation to delay the sale of
any such Collateral for the period of time necessary to permit the issuer of
such Collateral, even if such issuer would agree, to register such Collateral
for public sale under such applicable securities laws.

11. The remedies provided herein in favor of Payee shall not be
deemed exclusive, but shall be cumulative, and shall be in addition to all other
remedies in favor of Payee existing at law or in equity. Payee shall have no
duty as to the collection or protection of the Collateral or any income thereon
or as to the preservation of any rights pertaining thereto, beyond the safe
custody thereof of any securities representing such Collateral that are actually
in its possession. No delay on the part of Payee in exercising any of its
options, powers or rights, or any partial or single exercise thereof, shall
constitute a waiver thereof.

12. Upon payment in full of all indebtedness of Maker hereunder,
Maker shall be entitled to the return of all of the Collateral which has not
been used or applied toward the payment of such indebtedness. The return by
Payee to Maker of such Collateral and other property shall be without
representation or warranty of any nature whatsoever and wholly without recourse.

13. The Maker shall at any time and from time to time upon the
request of the holder of this Note, execute and deliver such further powers,
authorities, proxies, and other documents and do such further acts and things as
the holder of this Note may reasonably request in order to offset the purposes
hereof.

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14. Maker shall, upon request, pay all of the reasonable expenses
of Payee in connection with the enforcement of any rights of Payee under this
Note.

15. This Note shall in all respects be governed by the laws of
the State of New York applicable to contracts made and to be performed entirely
in such State and any proceeding relating to this Note or any other indebtedness
secured may be brought only in the federal or state courts sitting in that
state, to the jurisdiction and venue of which the parties hereby submit. This
Note may not be altered or amended, except by a writing duly signed by the party
against whom such alteration or amendment is sought to be enforced.

16. This Note may be prepaid in part or in full at any time
without penalty. All prepayments shall be applied first to the payment of
accrued and unpaid interest and, second, to the reduction of principal.

17. Maker hereby waives presentment for payment, demand, notice
of dishonor, notice of protest and protest and all other notices and demands in
connection with the delivery, acceptance, performance or default of this Note.

BRYNWOOD PARTNERS III L.P.

By: BRYNWOOD MANAGEMENT III L.P.
its General Partner

_____________________________________
Hendrik J. Hartong, Jr.
A General Partner of Brynwood
Management III L.P.

THIS IS A FULL RECOURSE NOTE. PAYEE IS NOT OBLIGATED TO RESORT TO THE COLLATERAL
AND MAKER IS RESPONSIBLE FOR THE ENTIRE PRINCIPAL AND INTEREST OF THIS NOTE,
INCLUDING ANY DEFICIENCY IN THE EVENT PAYEE DOES RESORT TO THE COLLATERAL.