STAND-BY PURCHASE AGREEMENT



            THIS STAND-BY PURCHASE AGREEMENT (this "Agreement") is made and

entered into as of January 25, 2001, by and between INTERWORLD CORPORATION, a

Delaware corporation (the "Company"), and J NET ENTERPRISES, INC., a Nevada

corporation ("J Net"). Capitalized terms not otherwise defined herein shall have

the meanings assigned to them in the Stock Purchase Agreement referred to below.



            WHEREAS, the Company and J Net have entered into the Stock Purchase

Agreement, dated as of January 25, 2001 (the "Stock Purchase Agreement"),

providing for the conversion by J Net of the Securities into the Conversion

Shares;



            WHEREAS, among other things, the Stock Purchase Agreement

contemplates that the Company will commence a rights offering to be made to the

Company's shareholders (the "Rights Offering"); and



            WHEREAS, as provided for in the Stock Purchase Agreement, the

Company and J Net now desire to enter into this Agreement to provide for (i) a

stand-by commitment by J Net to purchase up to an aggregate number of shares of

Common Stock equal to the total number of shares offered but not purchased in

the Rights Offering as set forth herein (the "Stand-By Shares") and (ii) an

option on the part of J Net to purchase up to an aggregate number of shares of

Common Stock as set forth herein (the "Overallotment Shares" and, together with

the Stand-By Shares, the "J Net Rights Shares") in connection with the Rights

Offering.



            NOW, THEREFORE, in consideration of the foregoing, and for other

good and valuable consideration, the receipt and sufficiency of which is hereby

acknowledged, the parties agree as follows:



1.    AGREEMENT TO PURCHASE AND SELL STOCK.



            1.1. THE STAND-BY SHARES. Subject to the terms and conditions set

forth in this Agreement, the Company agrees to issue and sell to J Net, and J

Net agrees to purchase from the Company, the aggregate number of shares of

Common Stock equal to such number of shares of Common Stock not validly

subscribed for by other shareholders of the Company in the Rights Offering,

including pursuant to any oversubscription privilege, for a total purchase price

not to exceed twenty million dollars ($20,000,000) (the "Stand-By Shares"), at a

purchase price per share equal to sixty-five cents ($0.65) (the "Offering

Price"). The issuance and resale of the Stand-By Shares shall be duly registered

under the Securities Act as provided in SECTION 4.13 of the Stock Purchase

Agreement.



            1.2. THE OVERALLOTMENT SHARES. Following the expiration of the

exercise period of the rights offered in the Rights Offering (the "Rights") and

the purchase of the Stand-By Shares, J Net shall have the option (i) for a

period up to five (5) business days after the expiration of the exercise period

of the Rights, to purchase up to an aggregate number of shares





of Common Stock equal to the difference between thirty million seven hundred

sixty-nine two hundred thirty-one (30,769,231) shares and the Stand-By Shares at

a purchase price per share equal the Offering Price, and (ii) for a period up to

forty-five (45) days after the expiration of the exercise period of the Rights,

to purchase up to an aggregate number of shares of Common Stock equal to the

quotient obtained by dividing (1) the difference between (x) twenty million

dollars ($20,000,000) and (y) the aggregate amount paid by J Net for the

Overallotment Shares purchased pursuant to clause (i) above, by (2) the

Overallotment Average Price (the "Overallotment Option"). The issuance and

resale of the Overallotment Shares shall be duly registered under the Securities

Act. "Overallotment Average Price" means an amount equal to the greater of (xx)

the Offering Price or (yy) ninety percent (90%) of the volume weighted average

of the sale prices as reported by the NASDAQ National Market ("NASDAQ") for each

of the ten (10) consecutive Trading Days in the period ending on the day

immediately preceding the exercise of the Overallotment Option under clause (ii)

above. "Trading Day" means a day on which NASDAQ is open for trading.



2.   DETERMINATION OF STAND-BY SHARES; CLOSING.



            2.1. DETERMINATION OF STAND-BY SHARES. As soon as practicable

following the expiration of the exercise period of the Rights, the Company shall

notify J Net in writing of the number of Stand-By Shares, which shall be equal

to the total number of Rights issued by the Company, less the number of Rights

for which the Company has received proper notice of exercise and full payment of

the Offering Price, calculated in accordance with SECTION 1 of this Agreement.

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