<SUBMISSION>
<ACCESSION-NUMBER>0000921530-02-000332
<TYPE>SC 13D/A
<PUBLIC-DOCUMENT-COUNT>2
<FILING-DATE>20020531
<GROUP-MEMBERS>GEORGE SOROS
<GROUP-MEMBERS>QIH MANAGEMENT INVESTOR, L.P.
<GROUP-MEMBERS>QIH MANAGEMENT, INC.
<GROUP-MEMBERS>QUANTUM INDUSTRIAL PARTNERS LDC
<GROUP-MEMBERS>SFM DOMESTIC INVESTMENTS LLC
<GROUP-MEMBERS>SOROS FUND MANAGEMENT LLC
<SUBJECT-COMPANY>
<COMPANY-DATA>
<CONFORMED-NAME>BLUEFLY INC
<CIK>0001030896
<ASSIGNED-SIC>5961
<IRS-NUMBER>133612110
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>SC 13D/A
<ACT>34
<FILE-NUMBER>005-52401
<FILM-NUMBER>02667270
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>42 WEST 39TH ST
<CITY>NEW YORK
<STATE>NY
<ZIP>10018
<PHONE>2129448000
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>42 WEST 39TH ST
<CITY>NEW YORK
<STATE>NY
<ZIP>10018
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>PIVOT RULES INC
<DATE-CHANGED>19970305
</FORMER-COMPANY>
</SUBJECT-COMPANY>
<FILED-BY>
<COMPANY-DATA>
<CONFORMED-NAME>SOROS FUND MANAGEMENT LLC
<CIK>0001029160
<IRS-NUMBER>133914976
<STATE-OF-INCORPORATION>DE
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>SC 13D/A
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>888 SEVENTH AVENUE 33RD FLOOR
<CITY>NEW YORK
<STATE>NY
<ZIP>10106
<PHONE>2128721054
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>C/O AKIN, GUMP, STRAUSS,HAUER,FELD,
<STREET2>399 PARK AVENUE
<CITY>NEW YORK
<STATE>NY
<ZIP>10022
</MAIL-ADDRESS>
</FILED-BY>
<DOCUMENT>
<TYPE>SC 13D/A
<SEQUENCE>1
<FILENAME>bluefly_13da12.txt
<DESCRIPTION>AMENDMENT 12
<TEXT>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  SCHEDULE 13D


                    Under the Securities Exchange Act of 1934
                               (Amendment No. 12)*

                                  BLUEFLY, INC.
                                  -------------
                                (Name of Issuer)

                     Common Stock, Par Value $0.01 Per Share
                     ---------------------------------------
                         (Title of Class of Securities)

                                    096227103
                                    ---------
                                 (CUSIP Number)

                              Stephen M. Vine, Esq.
                    Akin, Gump, Strauss, Hauer & Feld, L.L.P.
                               590 Madison Avenue
                            New York, New York 10022
                                 (212) 872-1000
                       -----------------------------------
                  (Name, Address and Telephone Number of Person
                Authorized to Receive Notices and Communications)

                                  May 24, 2002
                             ----------------------
                      (Date of Event which Requires Filing
                               of this Statement)

If the filing person has previously  filed a statement on Schedule 13G to report
the  acquisition  that is the subject of this  Schedule  13D, and is filing this
schedule because of ss.ss.240.13d-1(e),  240.13d-1(f) or 240.13d-1(g), check the
following box [_].

Note:  Schedules  filed in paper format shall include a signed original and five
copies of the  schedule,  including  all exhibits.  See  ss.240.13d-7  for other
parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting  person's
initial filing on this form with respect to the subject class of securities, and
for  any  subsequent   amendment   containing   information  which  would  alter
disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the  Securities  Exchange  Act of
1934 ("Act") or otherwise  subject to the liabilities of that section of the Act
but  shall be  subject  to all other  provisions  of the Act  (however,  see the
Notes).


                          Continued on following pages
                               Page 1 of 39 Pages
                             Exhibit Index: Page 13


<PAGE>
                                  SCHEDULE 13D

CUSIP No. 096227103                                           Page 2 of 39 Pages


1        Names of Reporting Persons
         I.R.S. Identification Nos. of above persons (entities only).

                  QUANTUM INDUSTRIAL PARTNERS LDC

2        Check the Appropriate Box If a Member of a Group (See Instructions)
                                                  a. [_]
                                                  b. [X]

3        SEC Use Only

4        Source of Funds (See Instructions)

                  WC

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)

                  [_]

6        Citizenship or Place of Organization

                  Cayman Islands

                           7        Sole Voting Power
 Number of                                  18,603,969
    Shares
Beneficially               8        Shared Voting Power
 Owned By                                   0
    Each
 Reporting                 9        Sole Dispositive Power
   Person                                   18,603,969
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            18,603,969

12       Check if the Aggregate  Amount in Row (11) Excludes Certain Shares (See
         Instructions)

                                            [X]

13       Percent of Class Represented By Amount in Row (11)

                                            66.11%

14       Type of Reporting Person (See Instructions)

                  OO; IV


<PAGE>
                                 SCHEDULE 13D

CUSIP No. 096227103                                           Page 3 of 39 Pages



1        Names of Reporting Persons
         I.R.S. Identification Nos. of above persons (entities only).

                  QIH MANAGEMENT INVESTOR, L.P.

2        Check the Appropriate Box If a Member of a Group (See Instructions)
                                                  a. [_]
                                                  b. [_]

3        SEC Use Only

4        Source of Funds (See Instructions)

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)

                  [_]

6        Citizenship or Place of Organization

                  Delaware

                           7        Sole Voting Power
 Number of                                  18,603,969
    Shares
Beneficially               8        Shared Voting Power
 Owned By                                   0
    Each
 Reporting                 9        Sole Dispositive Power
   Person                                   18,603,969
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            18,603,969

12       Check if the Aggregate  Amount in Row (11) Excludes Certain Shares (See
         Instructions)

                                            [_]

13       Percent of Class Represented By Amount in Row (11)

                                            66.11%

14       Type of Reporting Person (See Instructions)

                  PN; IA



<PAGE>

                                 SCHEDULE 13D

CUSIP No. 096227103                                           Page 4 of 39 Pages


1        Names of Reporting Persons
         I.R.S. Identification Nos. of above persons (entities only).

                  QIH MANAGEMENT, INC.

2        Check the Appropriate Box If a Member of a Group (See Instructions)
                                                  a. [_]
                                                  b. [X]

3        SEC Use Only

4        Source of Funds (See Instructions)

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)

                  [_]

6        Citizenship or Place of Organization

                  Delaware

                           7        Sole Voting Power
 Number of                                  18,603,969
    Shares
Beneficially               8        Shared Voting Power
 Owned By                                   0
    Each
 Reporting                 9        Sole Dispositive Power
   Person                                   18,603,969
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            18,603,969

12       Check if the Aggregate  Amount in Row (11) Excludes Certain Shares (See
         Instructions)

                                            [X]

13       Percent of Class Represented By Amount in Row (11)

                                            66.11%

14       Type of Reporting Person (See Instructions)

                  CO


<PAGE>

                                 SCHEDULE 13D

CUSIP No. 096227103                                           Page 5 of 39 Pages


1        Names of Reporting Persons
         I.R.S. Identification Nos. of above persons (entities only).

                  SOROS FUND MANAGEMENT LLC

2        Check the Appropriate Box If a Member of a Group (See Instructions)
                                                  a. [_]
                                                  b. [X]

3        SEC Use Only

4        Source of Funds (See Instructions)

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)

                  [_]

6        Citizenship or Place of Organization

                  Delaware

                           7        Sole Voting Power
 Number of                                  18,603,969
    Shares
Beneficially               8        Shared Voting Power
 Owned By                                   0
    Each
 Reporting                 9        Sole Dispositive Power
   Person                                   18,603,969
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            18,603,969

12       Check if the Aggregate  Amount in Row (11) Excludes Certain Shares (See
         Instructions)

                                            [X]

13       Percent of Class Represented By Amount in Row (11)

                                            66.11%

14       Type of Reporting Person (See Instructions)

                  OO; IA


<PAGE>

                                 SCHEDULE 13D

CUSIP No. 096227103                                           Page 6 of 39 Pages


1        Names of Reporting Persons
         I.R.S. Identification Nos. of above persons (entities only).

                  SFM DOMESTIC INVESTMENTS LLC

2        Check the Appropriate Box If a Member of a Group (See Instructions)
                                                  a. [_]
                                                  b. [X]

3        SEC Use Only

4        Source of Funds (See Instructions)

                  WC

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)

                  [_]

6        Citizenship or Place of Organization

                  Delaware

                           7        Sole Voting Power
 Number of                                  608,790
    Shares
Beneficially               8        Shared Voting Power
 Owned By                                   0
    Each
 Reporting                 9        Sole Dispositive Power
   Person                                   608,790
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            608,790

12       Check if the Aggregate  Amount in Row (11) Excludes Certain Shares (See
         Instructions)

                                            [X]

13       Percent of Class Represented By Amount in Row (11)

                                            3.99%

14       Type of Reporting Person (See Instructions)

                  OO



<PAGE>

                                 SCHEDULE 13D

CUSIP No. 096227103                                           Page 7 of 39 Pages


1        Names of Reporting Persons
         I.R.S. Identification Nos. of above persons (entities only).

                  GEORGE SOROS (in the capacity described herein)

2        Check the Appropriate Box If a Member of a Group (See Instructions)
                                                  a. [_]
                                                  b. [X]

3        SEC Use Only

4        Source of Funds (See Instructions)

                  AF

5        Check Box If Disclosure of Legal  Proceedings  Is Required  Pursuant to
         Items 2(d) or 2(e)

                  [_]

6        Citizenship or Place of Organization

                  United States

                           7        Sole Voting Power
 Number of                                  19,212,759
  Shares
Beneficially               8        Shared Voting Power
Owned By                            0
   Each
 Reporting                 9        Sole Dispositive Power
   Person                                   19,212,759
    With
                           10       Shared Dispositive Power
                                            0

11       Aggregate Amount Beneficially Owned by Each Reporting Person

                                            19,212,759

12       Check if the Aggregate  Amount in Row (11) Excludes Certain Shares (See
         Instructions)

                                            [_]

13       Percent of Class Represented By Amount in Row (11)

                                            67.23%

14       Type of Reporting Person (See Instructions)

                  IA

<PAGE>
                                                              Page 8 of 39 Pages




                  This  Amendment  No. 12 to  Schedule  13D relates to shares of
Common Stock,  $0.01 par value per share (the "Shares"),  of Bluefly,  Inc. (the
"Issuer").  This Amendment No. 12 supplementally amends the initial statement on
Schedule 13D, dated August 6, 1999, and all  amendments  thereto  (collectively,
the "Initial  Statement"),  filed by the Reporting  Persons (as defined herein).
This Amendment No. 12 is being filed by the Reporting Persons to report that QIP
(as defined  herein) and SFM  Domestic  Investments  (as  defined  herein)  have
entered into an agreement with the Issuer as described  herein,  whereby QIP and
SFM Domestic  Investments each purchased from the Issuer  additional  Shares and
warrants to purchase Shares. Capitalized terms used but not defined herein shall
have  the  meanings  ascribed  to them in the  Initial  Statement.  The  Initial
Statement is supplementally amended as follows.

Item 2.  Identity and Background

                  This  Statement  is  being  filed  on  behalf  of  each of the
following persons (collectively, the "Reporting Persons"):

                  (i)      Quantum Industrial Partners LDC ("QIP");

                  (ii)     QIH Management Investor, L.P. ("QIHMI");

                  (iii)    QIH Management, Inc. ("QIH Management");

                  (iv)     Soros Fund Management LLC ("SFM LLC");

                  (v)      SFM   Domestic   Investments   LLC   ("SFM   Domestic
                           Investments"); and

                  (vi)     Mr. George Soros ("Mr. Soros").

                  This Statement  relates to the Shares held for the accounts of
QIP and SFM Domestic Investments.

Item 3.  Source and Amount of Funds or Other Consideration

                  The   information  set  forth  in  Item  6  hereof  is  hereby
incorporated by reference into this Item 3.

                  QIP expended  approximately  $1,839,833 of its working capital
to purchase the  securities  reported  herein as being  acquired  since April 2,
2002,  (the date of the last filing on Schedule 13D).  SFM Domestic  Investments
expended approximately $60,167 of its working capital to purchase the securities
reported  herein as being  acquired  since April 2, 2002,  (the date of the last
filing on Schedule 13D).

Item 4.   Purpose of Transaction

                  The   information  set  forth  in  Item  6  hereof  is  hereby
incorporated by reference into this Item 4.

                  The Reporting  Persons reserve the right to acquire,  or cause
to be acquired,  additional securities of the Issuer, to dispose of, or cause to
be disposed,  such securities at any time or to formulate other purposes,  plans
or proposals regarding the Issuer or any of its securities, to the extent deemed
advisable in light of general  investment and trading  policies of the Reporting
Persons, market conditions or other factors.


<PAGE>
                                                              Page 9 of 39 Pages

Item 5.  Interest in Securities of the Issuer

                  (a) (i) Each of QIP, QIHMI,  QIH Management and SFM LLC may be
deemed the beneficial owner of 18,603,969  Shares  (approximately  66.11% of the
total number of Shares  outstanding  assuming the exercise and conversion of all
of the  securities  held for the  account of QIP).  This  number  consists of A)
5,287,082  Shares,  B) 3,806,923  Shares issuable upon the conversion of 445,410
shares of Series A  Preferred  Stock,  C)  8,607,843  Shares  issuable  upon the
conversion of 8,607,843  shares of Series B Preferred  Stock,  D) 363,113 Shares
issuable  upon the  exercise of warrants  held for the account of QIP, E) 96,830
Shares issuable upon the exercise of Warrant No. 11 held for the account of QIP,
F) 58,098  Shares  issuable  upon the  exercise  of Warrant  No. 13 held for the
account of QIP, G) 96,830  Shares  issuable  upon the exercise of Warrant No. 15
held for the account of QIP, and H) 287,250 Shares issuable upon the exercise of
Warrant No. 17 (as defined herein) held for the account of QIP.

                  (ii) SFM  Domestic  Investments  may be deemed the  beneficial
owner of  608,790  Shares  (approximately  3.99% of the  total  number of Shares
outstanding  assuming the exercise and conversion of all the securities held for
its  account).  This number  consists of A) 172,995  Shares,  B) 124,701  Shares
issuable upon the  conversion of 14,590 shares of Series A Preferred  Stock held
for its account,  C) 281,571  Shares  issuable  upon the  conversion  of 281,571
shares  of Series B  Preferred  Stock  held for its  account,  D) 11,887  Shares
issuable  upon the exercise of warrants  held for its  account,  E) 3,170 Shares
issuable  upon the  exercise  of Warrant No. 12 held for its  account,  F) 1,902
Shares  issuable  upon the exercise of Warrant No. 14 held for its  account,  G)
3,170 Shares  issuable upon the exercise of Warrant No. 16 held for its account,
and H) 9,394  Shares  issuable  upon the  exercise of Warrant No. 18 (as defined
herein) held for its account.

                  (iii)  Mr.  Soros  may  be  deemed  the  beneficial  owner  of
19,212,759  Shares   (approximately   67.23%  of  the  total  number  of  Shares
outstanding  assuming the exercise and conversion of all of the securities  held
for the accounts of QIP and SFM Domestic  Investments).  This number consists of
A) 5,287,082  Shares held for the account of QIP, B) 3,806,923  Shares  issuable
upon the conversion of 445,410  shares of Series A Preferred  Stock held for the
account of QIP, C) 8,607,843  Shares  issuable upon the  conversion of 8,607,843
shares of Series B  Preferred  Stock  held for the  account  of QIP,  D) 363,113
Shares  issuable  upon the exercise of warrants  held for the account of QIP, E)
96,830 Shares  issuable upon the exercise of Warrant No. 11 held for the account
of QIP, F) 58,098  Shares  issuable upon the exercise of Warrant No. 13 held for
the account of QIP, G) 96,830  Shares  issuable upon the exercise of Warrant No.
15 held for the account of QIP, H) 287,250 Shares  issuable upon the exercise of
Warrant  No. 17 held for the  account  of QIP,  I) 172,995  Shares  held for the
account  of SFM  Domestic  Investments,  J)  124,701  Shares  issuable  upon the
conversion of 14,590 shares of Series A Preferred  Stock held for the account of
SFM Domestic  Investments,  K) 281,571  Shares  issuable upon the  conversion of
281,571 shares of Series B Preferred  Stock held for the account of SFM Domestic
Investments,  L) 11,887  Shares  issuable upon the exercise of warrants held for
the account of SFM  Domestic  Investments,  M) 3,170  Shares  issuable  upon the
exercise of the Warrant No. 12 held for the account of SFM Domestic Investments,
N) 1,902  Shares  issuable  upon the  exercise  of  Warrant  No. 14 held for the
account of SFM Domestic Investments,  O) 3,170 Shares issuable upon the exercise
of the Warrant No. 16 held for the account of SFM Domestic  Investments,  and P)
9,394 Shares  issuable  upon the exercise of Warrant No. 18 held for the account
of SFM Domestic Investments.

                  (b)(i)  Each of QIP,  QIHMI,  QIH  Management  and SFM LLC (by
virtue of the QIP  contract)  may be deemed to have the sole power to direct the
voting and  disposition  of the  18,603,969  Shares  held for the account of QIP
(assuming the  conversion  of all the Series A Preferred  Stock and the Series B
Preferred  Stock,  and the exercise of the warrants and Warrant No. 11,  Warrant
No. 13, Warrant No. 15 and Warrant No. 17 held for the account of QIP).
<PAGE>
                                                             Page 10 of 39 Pages


                  (ii) SFM Domestic  Investments  may be deemed to have the sole
power to direct the voting and  disposition  of the 608,790  Shares held for its
account  (assuming the  conversion  of all the Series A Preferred  Stock and the
Series B Preferred  Stock,  and the exercise of the warrants and Warrant No. 12,
Warrant No. 14, Warrant No. 16 and Warrant No. 18 held for its account).

                  (iii) Mr. Soros (as a result of his position  with SFM LLC and
in his capacity as the sole managing member of SFM Domestic  Investments) may be
deemed to have the sole power to direct the voting and disposition of 19,212,759
Shares held for the  accounts of QIP and SFM Domestic  Investments.  This number
consists  of A)  18,603,969  Shares held for the  account of QIP  (assuming  the
conversion of all the Series A Preferred Stock and the Series B Preferred Stock,
and the exercise of the warrants and Warrant No. 11, Warrant No. 13, Warrant No.
15 and Warrant  No. 17 held for the  account of QIP) and B) 608,790  Shares held
for the account of SFM Domestic Investments  (assuming the conversion of all the
Series A Preferred Stock and the Series B Preferred  Stock,  and the exercise of
the warrants and Warrant No. 12,  Warrant No. 14, Warrant No. 16 and Warrant No.
18 held for the account of SFM Domestic Investments).

                  (c) Except  for the  transactions  described  in Item 6 below,
which were effected in a privately  negotiated  transaction,  there have been no
transactions  effected with respect to the Shares since April 2, 2002, (the date
of the last filing on Schedule 13D) by any of the Reporting Persons.

                  (d)(i) The shareholders of QIP,  including Quantum  Industrial
Holdings,  Ltd., a British Virgin Islands  international  business company, have
the right to participate in the receipt of dividends  from, or proceeds from the
sales of, the  securities  held for the account of QIP in accordance  with their
ownership interests in QIP.

                  (ii)  Certain  members of SFM  Domestic  Investments  have the
right to participate in the receipt of dividends from, or proceeds from the sale
of, the securities held for the account of SFM Domestic Investments.

                  (e)   Not applicable.

Item 6.    Contracts, Arrangements, Understandings or Relationships with Respect
           to Securities of the Issuer

                  On May 24,  2002,  the Issuer  entered into a Common Stock and
Warrant Purchase Agreement (the "Purchase  Agreement") with certain investors of
the  Issuer,  including  QIP and SFM  Domestic  Investments  (a copy of which is
attached hereto as Exhibit DDD and incorporated  herein by reference in response
to this Item 6).  Pursuant to the Purchase  Agreement,  QIP purchased  1,148,998
Shares  for an  aggregate  purchase  price  of  $1,803,926.75  and SFM  Domestic
Investments   purchased  37,575  Shares  for  an  aggregate  purchase  price  of
$58,992.75.  Also pursuant to the Purchase  Agreement,  QIP  purchased  warrants
("Warrant  No. 17") to subscribe  for and  purchase up to 287,250  Shares for an
aggregate  purchase price of $35,906.25 and SFM Domestic  Investments  purchased
warrants ("Warrant No. 18") to subscribe for and purchase up to 9,394 Shares for
an aggregate purchase price of $1,174.25.  Warrant No. 17 and Warrant No. 18 are
exercisable  at any time after May 24, 2002 at a price per share equal to $1.88.
A copy of the form of Warrants  No. 17 and No. 18 is attached  hereto in Exhibit
DDD as  Exhibit  A to the  Purchase  Agreement  and is  incorporated  herein  by
reference in response to this Item 6.

                  The Purchase  Agreement  requires the Issuer to file within 45
days  and to  use  commercially  reasonable  efforts  to  cause  to be  declared
effective  within 90 days, a registration  statement under the Securities Act of
1933, as amended, covering the Shares (as defined in the Purchase Agreement) and
Warrant Shares (as defined in the Purchase Agreement)  purchased pursuant to the
Purchase Agreement. In addition, the Purchase Agreement provides that the Issuer
will use commercially reasonable efforts to nominate a representative of Breider
Moore & Co., LLC  ("Breider  Moore") to the Issuer's  Board of Directors  and to
recommend that the Issuer's  stockholders  vote in favor of the election of such
representative  to the Issuer's  Board of  Directors  (as long as the Issuer and
Breider Moore  mutually agree as to the identity of such  representative).  Such
provision will continue to have effect for so long as Breider Moore continues to
own,  beneficially and of record,  at least five  percent(5%)of  the outstanding
shares of voting stock of the Issuer.

<PAGE>

                                                             Page 11 of 39 Pages

                  The  foregoing  descriptions  of the  Purchase  Agreement  and
Warrants  No. 17 and No. 18 do not purport to be complete  and are  qualified in
their entirety by the terms of each such document which are incorporated  herein
by reference.

                  Except as set forth herein,  the Reporting Persons do not have
any contracts, arrangements, understandings or relationships with respect to any
securities of the Issuer.

Item 7.  Material to be Filed as Exhibits

         The Exhibit Index is incorporated herein by reference.



<PAGE>
                                                             Page 12 of 39 Pages



                                   SIGNATURES

         After reasonable inquiry and to the best of my knowledge and belief,
the undersigned certifies that the information set forth in this Statement is
true, complete and correct.

Date: May 30, 2002                      QUANTUM INDUSTRIAL PARTNERS LDC

                                        By:  /s/  Richard D. Holahan, Jr.
                                             -------------------------------
                                             Richard D. Holahan, Jr.
                                             Attorney-in-Fact

                                        QIH MANAGEMENT INVESTOR, L.P.

                                        By:  QIH Management, Inc.,
                                             its General Partner

                                        By:  /s/  Richard D. Holahan, Jr.
                                             -----------------------------------
                                             Richard D. Holahan, Jr.
                                             Vice President

                                        QIH MANAGEMENT, INC.

                                        By:  /s/  Richard D. Holahan, Jr.
                                             -----------------------------------
                                             Richard D. Holahan, Jr.
                                             Vice President

                                        SOROS FUND MANAGEMENT LLC

                                        By:  /s/  Richard D. Holahan, Jr.
                                             -----------------------------------
                                             Richard D. Holahan, Jr.
                                             Assistant General Counsel

                                        SFM DOMESTIC INVESTMENTS LLC

                                        By:  George Soros
                                             Its Managing Member

                                        By:  /s/  Richard D. Holahan, Jr.
                                             -----------------------------------
                                             Richard D. Holahan, Jr.
                                             Attorney-in-Fact

                                        GEORGE SOROS

                                        By:  /s/  Richard D. Holahan, Jr.
                                             -----------------------------------
                                             Richard D. Holahan, Jr.
                                             Attorney-in-Fact


<PAGE>

                                                             Page 13 of 39 Pages

                                  EXHIBIT INDEX


DDD.     Form of the Common Stock and Warrant Purchase Agreement,          14
         dated May 24,2002, between Bluefly, Inc. and the
         investors listed on Schedule 1 thereto



</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>3
<FILENAME>bluefly_13a12exhddd.txt
<DESCRIPTION>EX-99.1-COMMON STOCK & WARRANT PURCHASE AGREEMENT
<TEXT>
                                                            Page 14 of 39 Pages
                                   EXHIBIT DDD


                   COMMON STOCK AND WARRANT PURCHASE AGREEMENT


         THIS COMMON STOCK AND WARRANT PURCHASE  AGREEMENT,  dated as of May 24,
2002 (this  "Agreement"),  is  entered  into by and  between  BLUEFLY,  INC.,  a
Delaware  corporation  (the  "Company"),  and the investors listed on Schedule 1
hereto (each, an "Investor" and, collectively, the "Investors").

                                    RECITALS

         WHEREAS,  the Investors  desire to purchase  from the Company,  and the
Company  desires  to issue  and sell to the  Investors,  5,620,609  shares  (the
"Shares") of common stock, par value $.01 per share (the "Common Stock"), of the
Company and warrants in the form attached hereto as Exhibit A (the  "Warrants"),
exercisable  to purchase up to an aggregate of 1,405,153  shares of Common Stock
at an  exercise  price of $1.88  per  share of  Common  Stock,  on the terms and
subject to the conditions contained herein.

                                    AGREEMENT

         NOW,  THEREFORE,  in consideration  for the mutual covenants  contained
herein,  and  for  other  good  and  valuable  consideration,  the  receipt  and
sufficiency of which are hereby acknowledged,  the parties hereto,  intending to
be legally bound, agree as follows:

                                    ARTICLE I
              PURCHASE AND SALE OF THE COMMON STOCK AND THE WARRANT

         SECTION 1.1 Purchase and Sale of the Common Stock. Subject to the terms
and conditions hereof, the Company hereby issues and sells to the Investors, and
each Investors hereby  purchases from the Company,  the number of Shares set for
opposite such  Investor's  name in Schedule 1, for a purchase price of $1.57 per
share,  resulting in an aggregate purchase price for all Shares sold pursuant to
the terms hereof of $8,824,355.87.

         SECTION 1.2 Purchase and Sale of the Warrant.  Subject to the terms and
conditions  hereof,  the Company hereby issues and sells to the  Investors,  and
each  Investor  hereby  purchases  from the Company,  the number of Warrants set
forth  opposite  such  Investor's  name in Schedule  1, for a purchase  price of
$0.125 per Warrant,  resulting in an aggregate  purchase  price for all Warrants
sold pursuant to the terms hereof of $175,644.13.



<PAGE>
                                                             Page 15 of 39 Pages


                                   ARTICLE II
            REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY

         The Company  represents and warrants to, and agrees with, the Investors
as follows:

         SECTION 2.1  Organization,  etc. The Company has been duly  formed,  is
validly  existing as a corporation  in good standing under the laws of the State
of Delaware,  and is qualified to do business as a foreign  corporation  in each
jurisdiction  in which  the  failure  to be so  qualified  could  reasonably  be
expected to have a material adverse effect on the assets, liabilities, condition
(financial  or  other),  business  or results of  operations  of the  Company (a
"Material  Adverse Effect").  The Company has the requisite  corporate power and
authority to own,  lease and operate its  properties and to conduct its business
as presently  conducted and to enter into,  execute,  deliver and perform all of
its  duties  and  obligations   under  this  Agreement  and  to  consummate  the
transactions contemplated hereby.

         SECTION 2.2 Authorization.  The execution,  delivery and performance of
this  Agreement  and the issuance of the Shares,  the Warrants and the shares of
Common Stock issuable upon exercise of the Warrants (the "Warrant  Shares") have
been  duly  authorized  by all  necessary  corporate  action  on the part of the
Company.

         SECTION 2.3  Validity;  Enforceability.  This  Agreement  has been duly
executed and  delivered by the Company,  and  constitutes  the legal,  valid and
binding obligation of the Company, enforceable against the Company in accordance
with its terms,  except as such enforceability may be limited by, or subject to,
any bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
the enforcement of creditors' rights generally and subject to general principles
of equity.

         SECTION  2.4  Capitalization.  As of the date  hereof,  the  authorized
capital stock of the Company  consists of 40,000,000  shares of Common Stock and
25,000,000  shares of  preferred  stock,  $0.01 par  value per  share,  of which
500,000 shares have been  designated  Series A Convertible  Preferred  Stock and
9,000,000  shares have been  designated  Series B Convertible  Preferred  Stock.
Without giving effect to the  transactions  contemplated by this Agreement,  the
issued and  outstanding  capital stock of the Company  consists of (i) 9,205,331
shares of Common Stock,  (ii) 500,000  shares of Series A Convertible  Preferred
Stock and (iii) 8,910,782  shares of Series B Convertible  Preferred  Stock. All
such  shares of the  Company  have been duly  authorized  and are fully paid and
non-assessable.  Except  as set forth on  Schedule  2.4  hereto or as  otherwise
contemplated by this Agreement,  there are no outstanding  options,  warrants or
other equity securities that are convertible into, or exercisable for, shares of
the Company's capital stock.

         SECTION 2.5  Governmental  Consents.  The execution and delivery by the
Company of this Agreement and the performance by the Company of the transactions
contemplated  hereby,  do not and will not require the Company to  effectuate or
obtain any registration  with, consent or approval of, or notice to any federal,
state or  other  governmental  authority  or  regulatory  body,  other  than (i)
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                                                             Page 16 of 39 Pages


periodic and other filings under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), (ii) the listing of the Shares and the Warrant Shares with
the Nasdaq  SmallCap Market and The Boston Stock Exchange and (iii) as otherwise
required to comply with the obligations of the Company under Section 4.1 hereof.
The parties hereto agree and acknowledge that, in making the representations and
warranties in the foregoing sentence of this Section 2.5, the Company is relying
on the representations and warranties made by the Investors in Section 3.4.

         SECTION 2.6 No Violation.  The execution and delivery of this Agreement
and the performance by the Company of the transactions  contemplated hereby will
not (i) conflict  with or result in a breach of any provision of the articles of
incorporation or by-laws of the Company,  (ii) result in a default or breach of,
or, except for the approval of the holders of the Company's Series A Convertible
Preferred Stock and Series B Convertible  Preferred Stock,  require any consent,
approval,  authorization or permit of, or filing or notification to, any person,
company or entity under any of the terms,  conditions or provisions of any note,
bond, mortgage,  indenture,  loan, factoring  arrangement,  license,  agreement,
lease or other  instrument  or  obligation to which the Company is a party or by
which the  Company or any of its assets may be bound or (iii)  violate  any law,
judgment,  order, writ, injunction,  decree,  statute, rule or regulation of any
court,  administrative agency,  bureau, board,  commission,  office,  authority,
department or other  governmental  entity applicable to the Company,  except, in
the case of clause (ii) or (iii) above, any such event that could not reasonably
be  expected  to  have a  Material  Adverse  Effect  or  materially  impair  the
transactions contemplated hereby.

         SECTION 2.7 Issuances of  Securities.  The Shares and the Warrants have
been  validly  issued,  and,  upon  payment  therefor,  will be  fully  paid and
non-assessable.  Upon the exercise of the Warrants in accordance  with the terms
thereof,   the  Warrant   Shares  will  be  validly   issued,   fully  paid  and
non-assessable.  The offering, issuance, sale and delivery of the Shares and the
Warrants as contemplated by this Agreement are exempt from the  registration and
prospectus delivery  requirements of the Securities Act of 1933, as amended (the
"Securities  Act"), are being made in compliance with all applicable federal and
(except  for any  violation  or  non-compliance  that  could not  reasonably  be
expected  to  have  a  Material  Adverse  Effect)  state  laws  and  regulations
concerning the offer, issuance and sale of securities,  and are not being issued
in  violation  of any  preemptive  or other  rights  of any  stockholder  of the
Company.   The  parties  hereto  agree  and  acknowledge  that,  in  making  the
representations  and  warranties in the foregoing  sentence of this Section 2.7,
the  Company  is  relying  on the  representations  and  warranties  made by the
Investors in Section 3.4.

         SECTION 2.8 Absence of Certain  Developments.  Since December 31, 2001,
there has not been any: (i) material adverse change in the condition,  financial
or  otherwise,  of the  Company or in the  assets,  liabilities,  properties  or
business  of the  Company;  (ii)  declaration,  setting  aside or payment of any
dividend  or other  distribution  with  respect  to, or any  direct or  indirect
redemption or acquisition of, any capital stock of the Company;  (iii) waiver of
any valuable right of the Company or  cancellation of any material debt or claim
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                                                             Page 17 of 39 Pages

held by the Company;  (iv) material loss,  destruction or damage to any property
of the Company,  whether or not insured;  (v)  acquisition or disposition of any
material assets (or any contract or arrangement  therefor) or any other material
transaction by the Company  otherwise than for fair value in the ordinary course
of  business  consistent  with  past  practice;   or  (vi)  other  agreement  or
understanding,  whether  in writing or  otherwise,  for the  Company to take any
action of the type specified in clauses (i) through (v).

         SECTION 2.9  Commission  Filings.  The  Company has filed all  required
forms,  reports and other documents with the Securities and Exchange  Commission
(the "Commission") for periods from and after January 1, 2001 (collectively, the
"Commission Filings"),  each of which has complied in all material respects with
all  applicable  requirements  of the Securities Act and/or the Exchange Act (as
applicable).  The Company has heretofore  made available to the Investors all of
the Commission  Filings,  including the Company's Annual Report on Form 10-K for
the year ended December 31, 2001 and the Company's Quarterly Report on Form 10-Q
for the quarterly period ended March 31, 2002. As of their respective dates, the
Commission  Filings did not contain any untrue  statement of a material  fact or
omit to state a material fact necessary in order to make the statements made, in
light of the  circumstances  under  which they were made,  not  misleading.  The
audited financial  statements and unaudited interim financial  statements of the
Company  included or incorporated  by reference in such Commission  Filings have
been prepared in  accordance  with GAAP (except as may be indicated in the notes
thereto or, in the case of the unaudited statements, as permitted by Form 10-Q),
complied as of their respective  dates in all material  respects with applicable
accounting   requirements  and  the  published  rules  and  regulations  of  the
Commission with respect thereto,  and fairly present,  in all material respects,
the financial position of the Company as of the dates thereof and the results of
operations  for the periods then ended  (subject,  in the case of any  unaudited
interim financial  statements,  to the absence of footnotes required by GAAP and
normal year-end adjustments).

         SECTION 2.10 Brokers. Except for Enable Capital LLC ("Enable"), neither
the Company, nor any of its officers,  directors or employees,  has employed any
broker or  finder,  or (except  for  compensation  due to Enable,  for which the
Company will be solely  responsible)  incurred any  liability  for any brokerage
fees, commissions, finder's or other similar fees or expenses in connection with
the transactions contemplated hereby.

                                   ARTICLE III
           REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE INVESTORS

         Each Investor represents and warrants to, and agrees with, the Company,
severally but not jointly, as follows:

         SECTION 3.1  Organization,  etc. Such Investor has been duly formed and
is validly  existing and in good standing under the laws of its  jurisdiction of
organization. Such Investor has the requisite organizational power and authority
to enter into,  execute,  deliver and perform all of its duties and  obligations
under this Agreement and to consummate the transactions contemplated hereby.


<PAGE>
                                                             Page 18 of 39 Pages

         SECTION 3.2 Authority. The execution,  delivery and performance of this
Agreement  have been duly  authorized by all necessary  organizational  or other
action on the part of such Investor.

         SECTION 3.3  Validity;  Enforceability.  This  Agreement  has been duly
executed and delivered by such Investor,  and constitutes  the legal,  valid and
binding  obligation  of such  Investor,  enforceable  against  such  Investor in
accordance with its terms,  except as such  enforceability may be limited by, or
subject to, any bankruptcy,  insolvency,  reorganization,  moratorium or similar
laws  affecting the  enforcement of creditors'  rights  generally and subject to
general principles of equity.

         SECTION 3.4       Investment Representations.

              (a) Such  Investor  acknowledges  that the  offer  and sale of the
Shares and the  Warrants to such  Investor  have not been  registered  under the
Securities  Act, or the securities  laws of any state or regulatory body and are
being  offered  and sold in  reliance  upon  exemptions  from  the  registration
requirements  of the  Securities Act and such laws and may not be transferred or
resold  without  registration  under such laws unless an exemption is available.
The Shares,  the Warrants,  and any  certificate  for the Warrant Shares will be
imprinted with a legend in substantially the following form:

              "THE  OFFER  AND  SALE  OF  THE  SECURITIES  REPRESENTED  BY  THIS
              CERTIFICATE  HAVE NOT BEEN REGISTERED  UNDER THE SECURITIES ACT OF
              1933,  AS AMENDED,  OR THE  SECURITIES  LAWS OF ANY STATE AND SUCH
              SECURITIES  MAY  NOT  BE  SOLD,  TRANSFERRED,  ASSIGNED,  PLEDGED,
              HYPOTHECATED,  OR  OTHERWISE  DISPOSED  OF  EXCEPT  PURSUANT  TO A
              REGISTRATION  STATEMENT WITH RESPECT TO SUCH  SECURITIES  WHICH IS
              EFFECTIVE UNDER SUCH ACT AND UNDER ANY APPLICABLE STATE SECURITIES
              LAWS UNLESS, IN THE OPINION OF COUNSEL REASONABLY  SATISFACTORY TO
              THE COMPANY,  AN EXEMPTION FROM THE  REGISTRATION  REQUIREMENTS OF
              SUCH ACT AND STATE SECURITIES LAWS IS AVAILABLE."

              (b) Such  Investor is  acquiring  the  Shares,  the  Warrants  and
Warrant Shares for investment and not with a view to the resale or  distribution
thereof and is acquiring such securities for its own account.

              (c) Such  Investor is an  "accredited  investor"  (as that term is
defined in Rule 501 of Regulation D promulgated  under the  Securities  Act), is
sophisticated  in  financial  matters and is familiar  with the  business of the
Company  so that it is  capable  of  evaluating  the  merits  and  risks  of its
investment  in the  Company and has the  capacity to protect its own  interests.
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                                                             Page 19 of 39 Pages


Such Investor has had the  opportunity  to  investigate on its own the Company's
business, management and financial affairs and has had the opportunity to review
the Company's operations and facilities and to ask questions and obtain whatever
other information concerning the Company as such Investor has deemed relevant in
making its investment decision.

              (d)  Such  Investor  is  in   compliance   with  the  Uniting  and
Strengthening  America by Providing  Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001. Neither such Investor,  nor any of its principal
owners, partners,  members, directors or officers is included on: (i) the Office
of Foreign Assets Control list of foreign nations, organizations and individuals
subject  to  economic  and trade  sanctions,  based on U.S.  foreign  policy and
national security goals; (ii) Executive Order 13224,  which sets forth a list of
individuals and groups with whom U.S. persons are prohibited from doing business
because such persons have been  identified  as terrorists or persons who support
terrorism  or (iii) any other watch list issued by any  governmental  authority,
including the Commission.

              (e) No  representations  or  warranties  have  been  made  to such
Investor by the Company or any director,  officer,  employee, agent or affiliate
of the Company, other than the representations and warranties of the Company set
forth  herein,  and the decision of such Investor to purchase the Shares and the
Warrant is based on the information contained herein, the Commission Filings and
such Investor's own independent investigation of the Company.

         SECTION 3.5 Governmental  Consents.  The execution and delivery by such
Investor  of  this  Agreement  and  the  performance  by  such  Investor  of the
transactions  contemplated  hereby, do not and will not require such Investor to
effectuate or obtain any registration with, consent or approval of, or notice to
any federal state or other governmental authority or regulatory body, except for
the filing with the  Commission  of a Schedule  13D under the  Exchange Act with
respect to the acquisition by such Investor of the Shares and the Warrants.

         SECTION 3.6 No Violation.  The execution and delivery of this Agreement
and the performance by such Investor of the  transactions  contemplated  hereby,
will not (i)  conflict  with or  result  in a  breach  of any  provision  of the
articles of incorporation,  by-laws or similar organizational  documents of such
Investor or (ii) violate any law,  judgment,  order, writ,  injunction,  decree,
statute, rule or regulation of any court,  administrative agency, bureau, board,
commission,   office,   authority,   department  or  other  governmental  entity
applicable to such Investor, except any such violation that could not reasonably
be expected to materially impair the transactions contemplated hereby.

         SECTION 3.7 Brokers.  Neither such  Investor,  nor any of its officers,
directors  or  employees,  has  employed  any broker or finder,  or incurred any
liability for any brokerage fees, commissions, finder's or other similar fees or
expenses in connection with the transactions contemplated hereby.

<PAGE>
                                                             Page 20 of 39 Pages

                                   ARTICLE IV
                                    COVENANTS

         SECTION 4.1 Registration Rights.

              (a) The Company shall:  (i) prepare and file with the Commission a
registration  statement  under the Securities Act (as the same may be amended or
supplemented  from time to time, the  "Registration  Statement") with respect to
the offer and sale by the Investors of the Shares and the Warrant  Shares within
forty-five (45) days of the date hereof;  and (ii) use  commercially  reasonable
efforts to cause the  Registration  Statement  to be declared  effective  by the
Commission within ninety (90) days of the date of Closing. The Company shall use
commercially   reasonable   efforts  to  maintain  the   effectiveness  of  such
Registration Statement until the earliest to occur of the following:  (i) all of
the  Shares  and the  Warrant  Shares  have been  disposed  of by the  Investors
pursuant to the Registration  Statement or otherwise transferred (or in the case
of the Warrant Shares, all of the Warrants pursuant to which such Warrant Shares
are issuable  have  expired);  or (ii) the Shares and the Warrant  Shares can be
resold pursuant to subsection (k) of Rule 144,  promulgated under the Securities
Act, or any similar provisions then in effect.

              (b) The  Investors  will  furnish to the  Company  in writing  all
information  reasonably  requested by the Company for use in connection with the
preparation  of the  Registration  Statement  and  obtaining  the  effectiveness
thereof.  Each  Investor  hereby  represents  and  warrants,  severally  but not
jointly,  that all such information  furnished by it shall be true, accurate and
complete.

              (c) If at any  time  or  from  time  to  time  after  the  date of
effectiveness of the Registration Statement,  the Company notifies the Investors
in writing of the existence of a Potential Material Event (as defined below), no
Investor shall offer or sell any of the Shares or Warrant  Shares,  or engage in
any other  transaction  involving  or relating to the Shares or Warrant  Shares,
from the time of the giving of notice with respect to a Potential Material Event
until such Investor receives written notice from the Company that such Potential
Material Event either has been disclosed to the public or no longer  constitutes
a Potential Material Event. As used herein, "Potential Material Event" means any
of the following:  (i) the possession by the Company of material information not
ripe for  disclosure in a  registration  statement,  which shall be evidenced by
determinations  in good  faith by the Board of  Directors  of the  Company  that
disclosure  of  such  information  in  the   registration   statement  would  be
detrimental  to the business  and affairs of the  Company;  or (ii) any material
engagement  or  activity  by  the  Company  which  would,   in  the  good  faith
determination of the Board of Directors of the Company, be adversely affected by
disclosure in a registration  statement at such time, which  determination shall
be  accompanied by a good faith  determination  by the Board of Directors of the
Company that the registration  statement would be materially  misleading  absent
the inclusion of such information.
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                                                             Page 21 of 39 Pages

              (d) To the extent  not  inconsistent  with  applicable  law,  each
Investor agrees that, in connection  with any registered  public offering of the
Company's equity securities,  it will not effect any public sale or distribution
of any of the Shares or the Warrant  Shares,  including a sale  pursuant to Rule
144 under the  Securities  Act,  during  the 10 days prior to, and during the 90
days  beginning on, the effective date of the Company's  registration  statement
(except as part of such  registration)  with respect to such  registered  public
offering, if and to the extent reasonably requested by the Company in writing in
the case of a  non-underwritten  public  offering  or to the  extent  reasonably
requested by the underwriter in the case of an underwritten public offering.

              (e) All  registration  and  filing  fees,  fees  and  expenses  of
compliance with securities laws, printing expenses and all independent certified
public accountants fees and expenses of counsel to the Company and other persons
retained by the Company will be borne by the Company.  The Company shall have no
obligation  to pay any fees or  expenses of  brokers,  underwriters,  counsel or
others  retained  by any of the  Investors  in  connection  with  the  sale,  or
potential sale, of the Shares or Warrant Shares.

              (f)  The  Company  agrees  to  indemnify,  to the  fullest  extent
permitted  by law,  the  Investors  and their  respective  officers,  directors,
partners,   employees,  advisors  and  agents  against  any  and  all  Loss  (as
hereinafter defined) arising out of or based upon any untrue, or alleged untrue,
statement of a material fact contained in the Registration  Statement or arising
out of or based  upon any  omission  or  alleged  omission  to state  therein  a
material fact required to be stated  therein or necessary to make the statements
therein  not  misleading,  except  (i)  insofar  as the  same are  caused  by or
contained in any information  furnished by an Investor pursuant to clause (b) or
(ii)  insofar as the same are caused by a failure by an  Investor  to deliver an
updated prospectus that has been filed with the Commission and made available to
such Investor or its representatives for delivery to a purchaser.  Each Investor
agrees to indemnify,  to the fullest extent  permitted by law, the Company,  the
other Investors and their respective officers,  directors,  partners, employees,
advisors  and agents  against any and all Loss  arising out of or based upon any
untrue,  or  alleged  untrue  statement  of a  material  fact  contained  in the
Registration  Statement  or arising out of or based upon any omission or alleged
omission  to state  therein a material  fact  required  to be stated  therein or
necessary to make the statements  therein not misleading (i) insofar as the same
are caused by or contained in any information furnished by indemnifying Investor
pursuant  to clause  (b) or (ii)  insofar as the same are caused by a failure by
the indemnifying  Investor to deliver an updated  prospectus that has been filed
with the Commission  and made available to such Investor or its  representatives
for delivery to a purchaser. Any indemnity obligation arising under this Section
4.1 shall be governed by the provisions of Section 5.3.

         SECTION 4.2 Board of Directors. For so long as Breider Moore & Co., LLC
("Breider  Moore")  continues to own,  beneficially and of record, at least five
percent  (5%) of the  outstanding  shares of voting  stock of the  Company,  the
Company will use commercially reasonable efforts to nominate a representative of
Breider  Moore to the  Company's  Board of Directors  and to recommend  that the
Company's  stockholders vote in favor of the election of such  representative to
the Company's  Board of  Directors;  provided that Breider Moore and the Company
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                                                             Page 22 of 39 Pages

shall  mutually agree as to the identity of such  representative.  In connection
with the  foregoing,  Breider Moore  represents  and warrants  that,  within the
preceding  five years,  none of the following has occurred with respect to it or
any of its principal owners,  partners,  members,  directors or officers:  (i) a
petition under the Federal bankruptcy laws or any state insolvency law was filed
by or against, or a receiver, fiscal agent or similar officer was appointed by a
court for the business or property of such person or entity,  or any partnership
in which  such  person or entity  was a general  partner  at or within two years
before the time of such filing,  or any  corporation or business  association of
which such  person was an  executive  officer at or within two years  before the
time of such  filing;  (ii) such  person or entity was  convicted  in a criminal
proceeding or is a named  subject of a pending  criminal  proceeding  (excluding
traffic  violations and other minor  offenses);  (iii) such person or entity was
the  subject  of any  order,  judgment  or decree,  not  subsequently  reversed,
suspended or vacated,  of any court of competent  jurisdiction,  permanently  or
temporarily  enjoining he, she or it from, or otherwise limiting,  the following
activities:  (A) acting as a futures commission  merchant,  introducing  broker,
commodity  trading  advisor,  commodity  pool operator,  floor broker,  leverage
transaction  merchant,  any other  person  regulated  by the  Commodity  Futures
Trading  Commission,  or an associated person of any of the foregoing,  or as an
investment  adviser,  underwriter,  broker  or dealer  in  securities,  or as an
affiliated person, director or employee of any investment company, bank, savings
and loan  association  or insurance  company,  or engaging in or continuing  any
conduct or practice in connection  with such activity,  (B) engaging in any type
of business  practice or (C)  engaging in any  activity in  connection  with the
purchase  or sale  of any  security  or  commodity  or in  connection  with  any
violation of Federal or State securities laws or Federal  commodities laws; (iv)
such  person or entity was the  subject of any order,  judgment  or decree,  not
subsequently  reversed,  suspended or vacated, of any Federal or State authority
barring,  suspending  or  otherwise  limiting for more than 60 days the right of
such person to engage in any  activity  described in clause  (iii)(A),  or to be
associated with persons engaged in any such activity;  (v) such person or entity
was  found by a court of  competent  jurisdiction  in a civil  action  or by the
Commission  to have  violated  any  Federal  or State  securities  law,  and the
judgment  in such  civil  action  or  finding  by the  Commission  has not  been
subsequently reversed,  suspended or vacated; and (vi) such person or entity was
found by a court of competent jurisdiction in a civil action or by the Commodity
Futures Trading Commission to have violated any Federal commodities law, and the
judgment  in such  civil  action or  finding by the  Commodity  Futures  Trading
Commission has not been subsequently reversed, suspended or vacated.

                                    ARTICLE V
                            SURVIVAL; INDEMNIFICATION

         SECTION 5.1 Survival.  The representations and warranties  contained in
Articles II and III hereof shall survive until the first anniversary of the date
hereof.
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                                                             Page 23 of 39 Pages

              (a)   Indemnification.   Each  party   (including   its  officers,
directors,  employees,  affiliates,  agents,  successors  and  assigns  (each an
"Indemnified  Party"))  shall be  indemnified  and held  harmless  by the  other
parties  hereto  (each an  "Indemnifying  Party")  for any and all  liabilities,
losses, damages,  claims, costs and expenses,  interest,  awards,  judgments and
penalties  (including,  without  limitation,   reasonable  attorneys'  fees  and
expenses) actually suffered or incurred by them (hereinafter a "Loss"),  arising
out of or resulting from the breach of any representation or warranty made by an
Indemnifying Party contained in this Agreement.  Notwithstanding  the foregoing,
the aggregate  liability of any Investor  under this Article V shall in no event
exceed fifty percent  (50%) of the purchase  price paid by such Investor for the
Shares and Warrants  purchased by it and the aggregate  liability of the Company
under  this  Article  V shall  in no event  exceed  fifty  percent  (50%) of the
purchase  price paid by the Investors  for the Shares and the  Warrants,  except
that the Company's  liability for a violation of any of the  representations and
warranties  contained in the first two  sentences of Section 2.7 may exceed such
limitation,  but shall in no event  exceed  one  hundred  percent  (100%) of the
purchase price paid by the Investors for the Shares and the Warrants.

         SECTION 5.2 Indemnification  Procedure. The obligations and liabilities
of the  Indemnifying  Party under this Article V with respect to Losses  arising
from claims of any third party which are subject to the indemnification provided
for in this Article V ("Third Party Claims") shall be governed by and contingent
upon the following  additional  terms and  conditions:  if an Indemnified  Party
shall receive notice of any Third Party Claim, the Indemnified  Party shall give
the  Indemnifying  Party  notice of such Third  Party Claim  promptly  after the
receipt by the Indemnified  Party of such notice (which notice shall include the
amount of the Loss, if known, and method of computation  thereof, and containing
a reference to the  provisions of this  Agreement in respect of which such right
of indemnification is claimed or arises); provided, however, that the failure to
provide  such notice  shall not release the  Indemnifying  Party from any of its
obligations under this Article V except to the extent the Indemnifying  Party is
materially  prejudiced  by such  failure and shall not relieve the  Indemnifying
Party from any other obligation or Liability that it may have to any Indemnified
Party  otherwise  than  under  this  Article  V.  Upon  written  notice  to  the
Indemnified  Party  within  five (5) days of the  receipt  of such  notice,  the
Indemnifying  Party  shall be entitled to assume and control the defense of such
Third Party Claim at its or his expense and through counsel of its or his choice
(which  counsel  shall be reasonably  satisfactory  to the  Indemnified  Party);
provided,  however,  that,  if there exists or is  reasonably  likely to exist a
conflict of interest that would make it inappropriate in the reasonable judgment
of the Indemnified  Party for the same counsel to represent both the Indemnified
Party and the Indemnifying  Party,  then the Indemnified Party shall be entitled
to retain its or his own counsel in each  jurisdiction for which the Indemnified
Party  reasonably  determines  counsel  is  required,  at  the  expense  of  the
Indemnifying  Party. In the event the Indemnifying  Party exercises the right to
undertake any such defense against any such Third Party Claim as provided above,
the  Indemnified  Party  shall  cooperate  with the  Indemnifying  Party in such
defense and make  available  to such  Indemnifying  Party,  at the  Indemnifying
Party's expense, all witnesses,  pertinent records, materials and information in
the  Indemnified  Party's  possession or under the  Indemnified  Party's control
relating thereto as is reasonably required by the Indemnifying Party. Similarly,



<PAGE>

                                                             Page 24 of 39 Pages

in the event the Indemnified  Party is,  directly or indirectly,  conducting the
defense  against  any such Third  Party  Claim,  the  Indemnifying  Party  shall
cooperate with the  Indemnified  Party in such defense and make available to the
Indemnified  Party,  at the  Indemnifying  Party's  expense,  all such witnesses
(including  himself),  records,  materials and  information in the  Indemnifying
Party's possession or under the Indemnifying Party's control relating thereto as
is reasonably  required by the Indemnified  Party. No such Third Party Claim may
be settled by the Indemnifying  Party on behalf of the Indemnified Party without
the prior written consent of the  Indemnified  Party (which consent shall not be
unreasonably  withheld);  provided,  however,  in the event that the Indemnified
Party does not consent to any such  settlement that would provide it with a full
release from  indemnified Loss and would not require it to take, or refrain from
taking, any action, the Indemnifying Party's liability for indemnification shall
not exceed the amount of such proposed  settlement.  The Indemnified  Party will
refrain from any act or omission that is inconsistent with the position taken by
the  Indemnifying  Party  in the  defense  of a Third  Party  Claim  unless  the
Indemnified  Party determines that such act or omission is reasonably  necessary
to protect its own interest.

                                   ARTICLE VI
                                  MISCELLANEOUS

         SECTION 6.1 Expenses.  The Company shall reimburse Breider Moore for up
to  $10,000  of  reasonable  legal  expenses  incurred  in  connection  with the
negotiation of this Agreement,  subject to the receipt of appropriate supporting
documentation.  Except as provided  above,  all costs and  expenses,  including,
without  limitation,  fees and disbursements of counsel,  incurred in connection
with the  negotiation,  execution and delivery of this Agreement and its related
documents shall be paid by the party incurring such costs and expenses,  whether
or not the Closing shall have occurred.

         SECTION 6.2  Publicity.  Except as may be required by applicable law or
the  rules of any  securities  exchange  or market  on which  securities  of the
Company  are  traded,  no party  hereto  shall  issue a press  release or public
announcement or otherwise make any disclosure  concerning this Agreement and the
transactions   contemplated  hereby,  without  prior  approval  of  the  others;
provided,  however, that nothing in this Agreement shall restrict the Company or
any Investor  from  disclosing  such  information  (a) that is already  publicly
available, (b) that may be required or appropriate in response to any summons or
subpoena  (provided that the disclosing party will use  commercially  reasonable
efforts to notify the other  parties  in advance of such  disclosure  under this
clause (b) so as to permit the non-disclosing parties to seek a protective order
or  otherwise  contest  such  disclosure,  and the  disclosing  party  will  use
commercially   reasonable   efforts  to   cooperate,   at  the  expense  of  the
non-disclosing  parties,  in  pursuing  any  such  protective  order)  or (c) in
connection with any litigation  involving disputes as to the parties' respective
rights and obligations hereunder.
<PAGE>

                                                             Page 25 of 39 Pages

         SECTION 6.3 Entire Agreement. This Agreement and any other agreement or
instrument to be delivered expressly pursuant to the terms hereof constitute the
entire  Agreement  between the parties hereto with respect to the subject matter
hereof and supersede all previous  negotiations,  commitments  and writings with
respect to such subject matter.

         SECTION 6.4  Assignments;  Parties in Interest.  Neither this Agreement
nor any of the rights, interests or obligations hereunder may be assigned by any
of the parties  hereto  (whether by operation of law or  otherwise)  without the
prior written consent of the other parties. This Agreement shall be binding upon
and inure  solely to the  benefit  of each party  hereto,  and  nothing  herein,
express or implied,  is intended to or shall  confer upon any person not a party
hereto any right,  benefit or remedy of any nature whatsoever under or by reason
hereof, except as otherwise provided herein.

         SECTION 6.5  Amendments.  This Agreement may not be amended or modified
except by an  instrument  in writing  signed  by, or on behalf  of, the  parties
against whom such amendment or modification is sought to be enforced.

         SECTION 6.6  Descriptive  Headings.  The  descriptive  headings of this
Agreement are inserted for convenience of reference only and do not constitute a
part of and shall not be utilized in interpreting this Agreement.

         SECTION 6.7 Notices and Addresses. Any notice, demand, request, waiver,
or other  communication  under this  Agreement  shall be in writing and shall be
deemed to have been duly given on the date of service,  if personally  served or
sent by facsimile; on the business day after notice is delivered to a courier or
mailed by express mail, if sent by courier  delivery service or express mail for
next day delivery; and on the fifth business day after mailing, if mailed to the
party to whom notice is to be given,  by first class  mail,  registered,  return
receipt requested, postage prepaid and addressed as follows:

To Company:             Bluefly, Inc.
                        42 West 39th Street, 9th Floor
                        New York, New York 10018
                        Fax:    (212) 354-3400
                        Attn:   Jonathan B. Morris

                        With a copy to:

                        Swidler Berlin Shereff Friedman, LLP
                        405 Lexington Avenue
                        New York, New York 10174
                        Fax:    (212) 891-9598
                        Attn:   Richard A. Goldberg, Esq.

<PAGE>

                                                             Page 26 of 39 Pages

To the Investors:      To the address set forth on Schedule 1.


         SECTION  6.8  Severability.  In the event  that any  provision  of this
Agreement  becomes or is declared  by a court of  competent  jurisdiction  to be
illegal, void or unenforceable, the remainder of this Agreement will continue in
full force and effect and the  application of such provision to other persons or
circumstances  will be  interpreted so as reasonably to effect the intent of the
parties hereto.  The parties further agree to replace such void or unenforceable
provision of this  Agreement  with a valid and  enforceable  provision that will
achieve,  to the extent possible,  the economic,  business and other purposes of
such void or unenforceable provision.

         SECTION 6.9  Governing  Law.  This  Agreement  shall be governed by and
construed in accordance with the internal laws of the State of New York, without
regard to conflicts of law principles.

         SECTION 6.10 Counterparts;  Facsimile Signatures. This Agreement may be
executed in one or more  counterparts,  all of which shall be considered one and
the same agreement and shall become effective when one or more counterparts have
been signed by each of the parties and  delivered to the other  party,  it being
understood that all parties need not sign the same  counterpart.  This Agreement
may be executed by  facsimile,  and a  facsimile  signature  shall have the same
force and effect as an original signature on this Agreement.

                            [Signature page follows]



<PAGE>
                                                             Page 27 of 39 Pages


         IN WITNESS WHEREOF, this Agreement has been duly executed on the date
first set forth above.

                                        BLUEFLY, INC.

                                        By:
                                             --------------------------
                                             Name:
                                             Title:

                                        BREIDER MOORE & CO., LLC


                                        By:
                                             --------------------------
                                             Name:
                                             Title:

                                        QUANTUM INDUSTRIAL PARTNERS LDC

                                        By:
                                             --------------------------
                                             Name:
                                             Title:

                                        SFM DOMESTIC INVESTMENTS LLC

                                        By:
                                             --------------------------
                                             Name:
                                             Title:

                                        ENABLE GROWTH PARTNERS, L.P.

                                        By:
                                             --------------------------
                                             Name:
                                             Title:




<PAGE>
                                                            Page 28 of 39 Pages
<TABLE>
<CAPTION>

                                   SCHEDULE 1

                   investors and share and warrant allocations

----------------------------------------- ---------------- --------------- --------------- --------------- --------------
                                                           Purchase                        Purchase        Aggregate
                                          Shares           Price for       Warrants        Price for       Purchase
Name and Address of Investor              Purchased        Shares          Purchased       Warrants        Price
<S>                                       <C>              <C>             <C>             <C>             <C>

----------------------------------------- ---------------- --------------- --------------- --------------- --------------
----------------------------------------- ---------------- --------------- --------------- --------------- --------------
Breider Moore & Co., LLC                  4,371,585        $6,863,388      1,092,896       $136,612        $7,000,000
One Embarcadero Center
Suite 4100
San Francisco, California 94111
Facsimile:  (415) 981-9211
Attention:  Joe Breider

with a copy to:

Thomas C. McNally III
455 Market Street
19th Floor
San Francisco, California 94105
Facsimile:  (415) 882-3232
----------------------------------------- ---------------- --------------- --------------- --------------- --------------
----------------------------------------- ---------------- --------------- --------------- --------------- --------------
Quantum Industrial Partners LDC           1,148,998        $1,803,926.75   287,250         $35,906.25      $1,839,833
Kaya Flamboyan 9
Villemstad
Curacao
Netherlands-Antilles

with a copy to:

Soros Fund Management LLC
888 Fifth Avenue
New York, New York 10106
Facsimile:  (212) 664-0544
Attn:  Richard Holahan, Esq.
----------------------------------------- ---------------- --------------- --------------- --------------- --------------
----------------------------------------- ---------------- --------------- --------------- --------------- --------------
SFM Domestic Investments LLC              37,575           $58,992.75      9,394           $1,174.25       $60,167
c/o Soros Fund Management LLC
888 Fifth Avenue
New York, New York 10106
Facsimile:  (212) 664-0544
Attn:  Richard Holahan, Esq.
----------------------------------------- ---------------- --------------- --------------- --------------- --------------
----------------------------------------- ---------------- --------------- --------------- --------------- --------------
Enable Growth Partners, L.P.              62,451           $98,048.37      15,613          $1,951.63       $100,000
One Sansome Street, Suite 2900
San Francisco, California 94104
Facsimile: (415) 265-4794
Attn: Mitch Levine
----------------------------------------- ---------------- --------------- --------------- --------------- --------------
</TABLE>


<PAGE>
                                                             Page 29 of 39 Pages



                                  SCHEDULE 2.4

                                 CAPITALIZATION




         As of the date hereof,  but without  giving effect to the  transactions
contemplated by this Agreement,  the following equity securities are outstanding
and convertible into, or exercisable for shares of Common Stock:

         1.   500,000  shares  of  Series A  Convertible  Preferred  Stock  (the
              "Series A Stock") are issued and  outstanding.  The Series A Stock
              is convertible into 4,273,504 shares of Common Stock.

         2.   8,910,782  shares of Series B  Convertible  Preferred  Stock  (the
              "Series B Stock") are issued and  outstanding.  The Series B Stock
              is convertible into 8,910,782 shares of Common Stock.

         3.   Warrants to purchase an aggregate  of  1,022,500  shares of Common
              Stock are issued and outstanding.

         4.   Options  issued to purchase  4,367,703  shares of Common Stock are
              issued and outstanding under the Company's 1997 Stock Option Plan,
              as amended, and 2000 Stock Option Plan, as amended.



<PAGE>
                                                             Page 30 of 39 Pages

                                                                       EXHIBIT A



THE OFFER AND SALE OF THE SECURITIES  REPRESENTED BY THIS  CERTIFICATE  HAVE NOT
BEEN REGISTERED,  QUALIFIED, APPROVED OR DISAPPROVED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY STATE AND
MAY NOT BE  SOLD OR  OTHERWISE  DISPOSED  OF  EXCEPT  PURSUANT  TO AN  EFFECTIVE
REGISTRATION  STATEMENT UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS OR AN APPLICABLE  EXEMPTION FROM THE REGISTRATION  REQUIREMENTS  UNDER SUCH
ACT OR LAWS AND NEITHER THE  SECURITIES  AND EXCHANGE  COMMISSION  NOR ANY OTHER
FEDERAL OR STATE  REGULATORY  AUTHORITY  HAS PASSED ON OR ENDORSED THE MERITS OF
THESE SECURITIES.

                                                                   WARRANT NO. 1



                                     WARRANT



                       TO PURCHASE SHARES OF COMMON STOCK



                                       OF



                                  BLUEFLY, INC.



THIS IS TO CERTIFY THAT  [_________________]  [INSERT NAME OF INVESTOR],  or its
registered  assigns (the  "Holder"),  is the owner of the right to subscribe for
and to purchase  from BLUEFLY,  INC., a Delaware  corporation  (the  "Company"),
[_________] [25% OF THE NUMBER OF SHARES OF COMMON STOCK PURCHASED] (the "Number
Issuable"),  fully paid,  duly  authorized and  non-assessable  shares of Common
Stock at a price per share equal to $1.88, (the "Exercise Price"),  at any time,
in whole or in part,  on or after May 24, 2002 (the  "Effective  Date")  through
5:00 PM New York City time, on May 24, 2007 (the  "Expiration  Date") all on the
terms and subject to the conditions hereinafter set forth (the "Warrants").

The Number  Issuable  and the Exercise  Price are subject to further  adjustment
from time to time  pursuant  to the  provisions  of  Section  2 of this  Warrant
Certificate.

Capitalized  terms used herein but not otherwise defined shall have the meanings
given to them in Section 12 hereof.



<PAGE>
                                                            Page 31 of 39 Pages

    Section 1.  Exercise of Warrants.

         (a)    Subject to the last  paragraph  of this  Section 1, the Warrants
evidenced hereby may be exercised,  in whole or in part, by the Holder hereof at
any time or from time to time, on or after the Effective Date and on or prior to
the  Expiration  Date upon  delivery to the Company at the  principal  executive
office of the  Company  in the United  States of  America,  of (A) this  Warrant
Certificate,  (B) a written  notice  stating that such Holder elects to exercise
the Warrants  evidenced hereby in accordance with the provisions of this Section
1 and specifying the number of Warrants being exercised and the name or names in
which the Holder wishes the  certificate  or  certificates  for shares of Common
Stock to be issued and (C)  payment  of the  Exercise  Price for such  Warrants,
which shall be payable by (x) cash,  or (y)  certified  or  official  bank check
payable to the order of the Company.  The  documentation and  consideration,  if
any,  delivered in accordance with subsections (A), (B) and (C) are collectively
referred to herein as the "Warrant Exercise Documentation."

         (b)    As promptly  as  practicable,  and in any event  within five (5)
Business Days after receipt of the Warrant Exercise  Documentation,  the Company
shall deliver or cause to be delivered (A) certificates  representing the number
of validly issued, fully paid and nonassessable shares of Common Stock specified
in the Warrant Exercise  Documentation,  (B) if applicable,  cash in lieu of any
fraction  of a share,  as  hereinafter  provided,  and (C) if less than the full
number  of  Warrants  evidenced  hereby  are  being  exercised,  a  new  Warrant
Certificate or Certificates, of like tenor, for the number of Warrants evidenced
by this Warrant  Certificate,  less the number of Warrants then being exercised.
Such exercise  shall be deemed to have been made at the close of business on the
date of  delivery  of the  Warrant  Exercise  Documentation  so that the  Person
entitled to receive  shares of Common Stock upon such exercise  shall be treated
for all  purposes  as having  become the record  holder of such shares of Common
Stock at such time.

         (c)    The Company shall pay all expenses  incurred by it in connection
with  taxes and other  governmental  charges  (other  than  income  taxes of the
Holder)  that may be imposed in respect  of, the issue or delivery of any shares
of Common Stock issuable upon the exercise of the Warrants evidenced hereby. The
Company shall not be required,  however,  to pay any tax or other charge imposed
in connection  with any transfer  involved in the issue of any  certificate  for
shares of Common  Stock,  as the case may be, in any name other than that of the
registered holder of the Warrant evidenced hereby.

         (d)    In  connection  with  the  exercise  of any  Warrants  evidenced
hereby,  no  fractions  of shares of Common  Stock shall be issued,  but in lieu
thereof the Company shall pay a cash  adjustment  in respect of such  fractional
interest in an amount equal to such fractional interest multiplied by the Market
Price for one  share of  Common  Stock on the  Business  Day  which  immediately
precedes  the day of  exercise.  If more  than  one (1)  such  Warrant  shall be
exercised by the holder  thereof at the same time,  the number of full shares of
Common  Stock  issuable on such  exercise  shall be computed on the basis of the
total number of Warrants so exercised.

<PAGE>
                                                            Page 32 of 39 Pages

    Section 2.  Certain Adjustments.

         (a)    The  number  of  shares of  Common  Stock  purchasable  upon the
exercise of this Warrant and the Exercise  Price shall be subject to  adjustment
as follows:

                (i)   Stock    Dividends,     Subdivision,     Combination    or
Reclassification  of Common Stock. If at any time after the date of the issuance
of this  Warrant the Company  shall (i) pay a dividend on Common Stock in shares
of its Capital Stock, (ii) combine its outstanding shares of Common Stock into a
smaller number of shares, (iii) subdivide its outstanding shares of Common Stock
as the case may be, or (iv)  issue by  reclassification  of its shares of Common
Stock any shares of Capital  Stock of the Company,  then, on the record date for
such dividend or the effective date of such subdivision or split-up, combination
or  reclassification,  as the case may be,  the  number and kind of shares to be
delivered upon exercise of this Warrant will be adjusted so that the Holder will
be entitled to receive the number and kind of shares of Capital  Stock that such
Holder  would have owned or been  entitled to receive  upon or by reason of such
event  had this  Warrant  been  exercised  immediately  prior  thereto,  and the
Exercise Price will be adjusted as provided below in paragraph 2(a)(v).

                (ii)  Extraordinary Distributions. If at any time after the date
of issuance of this  Warrant,  the Company  shall  distribute  to all holders of
Common  Stock  (including  any  such  distribution  made  in  connection  with a
consolidation  or merger in which the  Company is the  continuing  or  surviving
corporation  and Common Stock is not changed or  exchanged)  cash,  evidences of
indebtedness,  securities or other assets  (excluding  (A) ordinary  course cash
dividends  to the extent such  dividends  do not exceed the  Company's  retained
earnings  and (B)  dividends  payable  in  shares  of  Capital  Stock  for which
adjustment  is made under  Section  2(a)(i),  or rights,  options or warrants to
subscribe for or purchase securities of the Company), then in each such case the
number of shares of Common Stock to be delivered to such Holder upon exercise of
this Warrant shall be increased so that the Holder  thereafter shall be entitled
to receive the number of shares of Common Stock  determined by  multiplying  the
number of shares such  Holder  would have been  entitled to receive  immediately
before such record date by a  fraction,  the  denominator  of which shall be the
Exercise  Price on such  record  date  minus  the then  fair  market  value  (as
reasonably determined by the Board of Directors of the Company in good faith) of
the portion of the cash, evidences of indebted-ness,  securities or other assets
so  distributed  or of such  rights or warrants  applicable  to one share of the
Common  Stock  (provided  that such  denominator  shall in no event be less than
$.01) and the numerator of which shall be the Exercise Price.

                (iii) Reorganization,  etc.  If at any  time  after  the date of
issuance of this Warrant any  consolidation of the Company with or merger of the
Company with or into any other Person (other than a merger or  consolidation  in
which the Company is the surviving or continuing  corporation and which does not
result in any  reclassification  of, or change (other than a change in par value
or from par  value to no par value or from no par  value to par  value,  or as a
result of a subdivision or combination) in,  outstanding shares of Common Stock)
or any sale, lease or other transfer of all or  substantially  all of the assets
of the Company to any other person (each, a  "Reorganization  Event"),  shall be
<PAGE>
                                                            Page 33 of 39 Pages

effected in such a way that the holders of the Common Stock shall be entitled to
receive cash, stock, other securities or assets (whether such cash, stock, other
securities or assets are issued or distributed by the Company or another Person)
with respect to or in exchange for the Common Stock, then, upon exercise of this
Warrant, the Holder shall thereafter have the right to receive only the kind and
amount  of  cash,  stock,  other  securities  or  assets  receivable  upon  such
Reorganization  Event by a holder of the  number of shares of the  Common  Stock
that such  holder  would have been  entitled  to receive  upon  exercise of this
Warrant had this Warrant been exercised  immediately before such  Reorganization
Event,  subject  to  adjustments  that shall be as nearly  equivalent  as may be
practicable  to the  adjustments  provided for in this Section 2(a). The Company
shall  not  enter  into  any of the  transactions  referred  to in this  Section
2(a)(iii) unless  effective  provision shall be made so as to give effect to the
provisions set forth in this Section 2(a)(iii).


                (iv)  Carryover.  Notwithstanding  any other  provision  of this
Section  2(a),  no  adjustment  shall be made to the  number of shares of either
Common Stock to be  delivered  to the Holder (or to the Exercise  Price) if such
adjustment  represents  less than 2% of the number of shares to be so delivered,
but any lesser adjustment shall be carried forward and shall be made at the time
and  together  with  the  next  subsequent  adjustment  that  together  with any
adjustments  so  carried  forward  shall  amount to 2% or more of the  number of
shares to be so delivered.

                (v)   Exercise Price  Adjustment.  Whenever the Number  Issuable
upon the  exercise  of the  Warrant is  adjusted  as  provided  pursuant to this
Section  2(a),  the Exercise  Price per share  payable upon the exercise of this
Warrant shall be adjusted by multiplying such Exercise Price  immediately  prior
to such  adjustment by a fraction,  of which the  numerator  shall be the Number
Issuable upon the exercise of the Warrant  immediately prior to such adjustment,
and  of  which  the  denominator  shall  be  the  Number  Issuable   immediately
thereafter;  provided,  however,  that the Exercise  Price for each Share of the
Common  Stock  shall in no event be less  than the par  value of a share of such
Common Stock.

                (vi)  Notice of Adjustment.  Whenever the Number Issuable or the
Exercise Price is adjusted as herein  provided,  the Company shall promptly mail
by first class mail, postage prepaid,  to the Holder,  notice of such adjustment
or  adjustments  setting forth the Number  Issuable and the Exercise Price after
such  adjustment,  setting forth a brief  statement of the facts  requiring such
adjustment and setting forth the computation by which such adjustment was made.

    Section 3.  No  Redemption.  The Company  shall not have any right to redeem
any of the Warrants evidenced hereby.

    Section 4.  Notice of  Certain  Events.  In case at any time or from time to
time (i) the Company shall declare any dividend or any other distribution to all
holders of Common Stock,  (ii) the Company  shall  authorize the granting to the
holders of Common Stock of rights or warrants to  subscribe  for or purchase any
additional  shares of stock of any class or any other  right,  (iii) the Company

<PAGE>
                                                            Page 34 of 39 Pages

shall  authorize  the issuance or sale of any other shares or rights which would
result in an adjustment to the Number Issuable pursuant to Section 2(a)(i), (ii)
or (iii), (iv) there shall be any capital  reorganization or reclassification of
Common  Stock of the Company or  consolidation  or merger of the Company with or
into another Person,  or any sale or other  disposition of all or  substantially
all the assets of the Company or (v) there shall be a voluntary  or  involuntary
dissolution,  liquidation or winding up of the Company, then, in any one or more
of such cases the Company shall mail to the Holder at such  Holder's  address as
it appears on the transfer books of the Company,  as promptly as practicable but
in any  event  at least 10 days  prior  to the  date on which  the  transactions
contemplated in Section 2(a)(i),  (ii) or (iii) a notice stating (a) the date on
which a record is to be taken for the  purpose of such  dividend,  distribution,
rights or warrants or, if a record is not to be taken,  the date as of which the
holders  of record of  either  Common  Stock to be  entitled  to such  dividend,
distribution,  rights or warrants are to be  determined or (b) the date on which
such reclassification,  consolidation,  merger, sale,  conveyance,  dissolution,
liquidation  or winding up is  expected  to become  effective.  Such notice also
shall  specify the date as of which it is expected that the holders of record of
the Common  Stock shall be entitled to exchange  the Common  Stock for shares of
stock  or  other   securities  or  property  or  cash   deliverable   upon  such
reorganization,  reclassification,   consolidation,  merger,  sale,  conveyance,
dissolution, liquidation or winding up.

    Section 5.  Certain  Covenants.  The Company  covenants  and agrees that all
shares of Capital  Stock of the Company  that may be issued upon the exercise of
the Warrants evidenced hereby will be duly authorized,  validly issued and fully
paid  and  nonassessable.  The  Company  shall  at all  times  reserve  and keep
available  for issuance  upon the exercise of the  Warrants,  such number of its
authorized  but  unissued  shares of  Common  Stock as will from time to time be
sufficient to permit the exercise of all  outstanding  Warrants,  and shall take
all action required to increase the authorized  number of shares of Common Stock
if at any time there shall be  insufficient  authorized  but unissued  shares of
Common  Stock to permit  such  reservation  or to  permit  the  exercise  of all
outstanding Warrants.

    Section 6.  Registered  Holder.  The  persons in whose  names  this  Warrant
Certificate  is registered  shall be deemed the owner hereof and of the Warrants
evidenced  hereby  for all  purposes.  The  registered  Holder  of this  Warrant
Certificate,  in their  capacity  as such,  shall not be  entitled to any rights
whatsoever as a stockholder of the Company, except as herein provided.

    Section 7.  Transfer of Warrants.  Any transfer of the rights represented by
this  Warrant  Certificate  shall be effected by the  surrender  of this Warrant
Certificate,  along  with  the  form of  assignment  attached  hereto,  properly
completed  and  executed  by the  registered  Holder  hereof,  at the  principal
executive  office of the Company in the United States of America,  together with
an appropriate  investment  letter and opinion of counsel,  if deemed reasonably
necessary  by counsel  to the  Company,  to assure  compliance  with  applicable
securities  laws.  Thereupon,  the  Company  shall  issue  in the  name or names
specified  by the  registered  Holder  hereof  and,  in the  event of a  partial
transfer, in the name of the registered Holder hereof, a new Warrant Certificate
or Certificates evidencing the right to purchase such number of shares of Common
Stock as shall be equal to the number of shares of Common Stock then purchasable
hereunder.

<PAGE>
                                                            Page 35 of 39 Pages

    Section 8.  Denominations.  The  Company  covenants  that  it  will,  at its
expense,  promptly upon  surrender of this Warrant  Certificate at the principal
executive  office of the Company in the United  States of  America,  execute and
deliver  to  the  registered   Holder  hereof  a  new  Warrant   Certificate  or
Certificates in  denominations  specified by such Holder for an aggregate number
of  Warrants  equal  to  the  number  of  Warrants  evidenced  by  this  Warrant
Certificate.

    Section 9.  Replacement of Warrants.  Upon receipt of evidence  satisfactory
to the Company of the loss,  theft,  destruction  or  mutilation of this Warrant
Certificate and, in the case of loss, theft or destruction,  upon delivery of an
indemnity  reasonably  satisfactory  to the Company (in the case of an insurance
company or other institutional  investor,  its own unsecured indemnity agreement
shall be deemed to be reasonably  satisfactory),  or, in the case of mutilation,
upon surrender and  cancellation  thereof,  the Company will issue a new Warrant
Certificate  of like  tenor  for a number  of  Warrants  equal to the  number of
Warrants evidenced by this Warrant Certificate.

    Section 10. Governing Law. THIS WARRANT  CERTIFICATE  SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY,
THE INTERNAL LAWS OF THE STATE OF NEW YORK  APPLICABLE TO AGREEMENTS MADE AND TO
BE  PERFORMED  ENTIRELY  WITHIN SUCH STATE,  WITHOUT  REGARD TO CONFLICTS OF LAW
PRINCIPLES.

    Section 11. Rights Inure to  Registered  Holder.  The Warrants  evidenced by
this  Warrant  Certificate  will inure to the benefit of and be binding upon the
registered  Holder thereof and the Company and their  respective  successors and
permitted  assigns.  Nothing in this Warrant  Certificate  shall be construed to
give to any Person other than the Company and the registered  Holder thereof any
legal or equitable right,  remedy or claim under this Warrant  Certificate,  and
this  Warrant  Certificate  shall be for the sole and  exclusive  benefit of the
Company and such registered Holder. Nothing in this Warrant Certificate shall be
construed to give the registered  Holder hereof any rights as a Holder of shares
of either  Common Stock until such time,  if any, as the  Warrants  evidenced by
this Warrant Certificate are exercised in accordance with the provisions hereof.

    Section 12. Definitions.  For the purposes of this Warrant Certificate,  the
following terms shall have the meanings indicated below:

    "Business  Day" means any day other than a Saturday,  Sunday or other day on
which  commercial  banks in the City of New  York,  New York are  authorized  or
required by law or executive order to close.

    "Capital  Stock"  of  any  Person  means  any  and  all  shares,  interests,
participations  or  other  equivalents  (however  designated)  of such  Person's
capital stock (or equivalent  ownership interests in a Person not a corporation)
whether now outstanding or hereafter issued, including,  without limitation, any
rights, warrants or options to purchase such Person's capital stock.
<PAGE>
                                                            Page 36 of 39 Pages

    "Common Stock" shall mean the common stock, par value $.01 per share, of the
Company.

    "Market Price" shall mean, per share of Common Stock,  on any date specified
herein: (a) if the Common Stock is listed on a national securities exchange, the
Closing  Price  per share of Common  Stock on such  date  published  in The Wall
Street Journal  (National  Edition) or, if no such closing price on such date is
published  in The Wall Street  Journal  (National  Edition),  the average of the
closing  bid and asked  prices  on such  date,  as  officially  reported  on the
principal national  securities exchange on which the Common Stock is then listed
or admitted to trading;  (b) if the Common  Stock is not then listed or admitted
to trading on any national securities exchange,  but is designated as a national
market system security, the last trading price of the Common Stock on such date;
(c) if there  shall have been no trading on such date or if the Common  Stock is
not so  designated,  the average of the reported  closing bid and asked price of
the Common  Stock,  on such date as shown by NASDAQ and  reported  by any member
firm of the NYSE  selected by the Company;  or (d) if none of (a), (b) or (c) is
applicable,  a market price per share  determined  in good faith by the Board of
Directors of the Company, which shall be deemed to be "Fair Market Value" unless
holders of at least 15% of Common Stock issued or issuable  upon exercise of the
Warrants  request that the Company obtain an opinion of a nationally  recognized
investment  banking  firm chosen by the Company (who shall bear the expense) and
reasonably acceptable to such requesting holders of the Warrants, in which event
the Fair Market Value shall be as determined by such investment banking firm.

    "NASDAQ"  means  the  National  Association  of  Securities  Dealers,   Inc.
Automated Quotations System.

    "NYSE" shall mean the New York Stock Exchange, Inc.

    "Person" shall mean any individual,  corporation, limited liability company,
partnership,  trust, incorporated or unincorporated association,  joint venture,
joint stock company,  government (or an agency or political subdivision thereof)
or other entity of any kind.

    Section 13. Notices. All notices,  demands and other communications provided
for or permitted  hereunder  shall be made in writing and shall be by registered
or certified  first-class  mail, return receipt  requested,  courier services or
personal  delivery,  (a) if to the Holder of a Warrant,  at such  Holder's  last
known address appearing on the books of the Company;  and (b) if to the Company,
at its principal executive office in the United States, or such other address as
shall have been  furnished to the party given or making such  notice,  demand or
other communication. All such notices and communications shall be deemed to have


<PAGE>
                                                            Page 37 of 39 Pages

been duly given: (i) when delivered by hand, if personally delivered;  (ii) when
delivered to a courier if delivered by commercial overnight courier service; and
(iii) five (5) Business Days after being deposited in the mail, postage prepaid,
if mailed.

                           [Signature page to follow.]



<PAGE>
                                                            Page 38 of 39 Pages



         IN WITNESS WHEREOF,  the Company has caused this Warrant Certificate to
be duly executed as of this 24th day of May, 2002.



                                             BLUEFLY, INC.



                                             By:
                                                  -------------------------
                                                  Name:
                                                  Title:


<PAGE>
                                                            Page 39 of 39 Pages


                            [Form of Assignment Form]

                  [To be executed upon assignment of Warrants]


         The undersigned  hereby assigns and transfers this Warrant  Certificate
to  ___________________  whose  Social  Security  Number  or  Tax ID  Number  is
_________ and whose record address is _____________________________________, and
irrevocably appoints  ________________ as agent to transfer this security on the
books of the Company. Such agent may substitute another to act for such agent.

                                             Signature:



                                             -------------------------------

                                             Signature Guarantee:



                                             --------------------------------





   Date:
         -----------------







</TEXT>
</DOCUMENT>
</SUBMISSION>
