Exhibit 10.01

                                [ISW Letterhead]



                                                                  April 27, 2004




James McDade
125 South Street
Hightstown, NJ 08520


Dear Jim:

                  You have requested assurance from Interactive Systems
Worldwide Inc. (the "Company") that, in the event that after a Change of Control
(as defined below) of the Company, your employment was terminated without cause,
you would be given six months notice prior to such termination, or you would be
paid six months of severance in lieu of such notice. Although no such Change of
Control is currently contemplated or known to the Company, we understand your
concern. In consideration for your agreement to continue to be employed by the
Company through the effective date of any Change of Control, and thereafter to
continue in the employ of the Company during the period of a transition of up to
six months, we agree as follows:

                  1. In the event of a Change of Control of the Company, at the
request of the Company or its successor, you agree to remain employed by the
Company or its successor, for up to six months after the effective date of such
Change of Control (the "Transition Period).

                  2. During the Transition Period you shall continue to perform
functions for the Company or its successor that are consistent with your
background and experience. During the Transition Period, your primary office
shall be at the Company's US headquarters, currently in West Paterson, New
Jersey, subject to reasonable business travel as may be requested of you from
time to time.

                  3. During the Transition Period you shall continue to be paid
your base salary at the same rate, and be entitled to receive substantially the
same benefits as you were receiving immediately prior to the Change of Control
(except that no new stock options would be granted to you during the Transition
Period).

                  4. During the Transition Period you shall continue to exercise
your reasonable best efforts on behalf of the Company.

<PAGE>

James McDade                          -2-                         April 27, 2004


                  5. At any time within one year after a Change of Control, if
your employment is terminated other than for Cause, you shall be given six
months notice of such termination or be paid severance equivalent to six months
of your base salary, or any combination of such notice and severance. During
such Notice Period or in connection with payment of such severance, you shall
also be entitled to receive continuation of substantially all benefits that you
received prior thereto. During such Notice Period you shall continue to devote
your full time and attention, and exercise your reasonable best efforts on
behalf of the Company; provided that you shall be entitled to reasonable periods
of time off to interview for other employment. In the event you are being paid
severance, and you obtain other employment, you shall be paid the remainder, if
any of such severance in a lump sum promptly after the last day of your active
employment with the Company.

                  6. As used herein, the term "Change of Control" shall have the
same meaning as ascribed to such term in the Company's 1996 Stock Option Plan,
as amended.

                  If the foregoing accurately sets forth your understanding,
please sign the duplicate copy of this letter and return it to me.


                                                  Very truly yours,

                                                  INTERACTIVE SYSTEMS
                                                  WORLDWIDE INC.



                                                  By: /s/ Bernard Albanese
                                                      ---------------------
                                                      Bernard Albanese
                                                      President
Agreed and Accepted:



/s/ James McDade
----------------------
James McDade