                                                             Page 14 of 36 Pages


                                                                     EXHIBIT EEE




                 SERIES 2002 PREFERRED STOCK PURCHASE AGREEMENT
                 ----------------------------------------------


     THIS SERIES 2002 PREFERRED STOCK PURCHASE AGREEMENT, dated as of August __,
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,  Two Thousand  One Hundred  (2,100)
shares (the "Shares") of Series 2002 Convertible Preferred Stock, par value $.01
per share (the "Series 2002 Preferred Stock"),  of the Company 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 SERIES 2002 PREFERRED STOCK
                ------------------------------------------------

     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 Shares set for  opposite  such  Investor's  name in  Schedule 1, for a
purchase  price of One  Thousand  Dollars  ($1,000)  per share,  resulting in an
aggregate purchase price for all Shares sold pursuant to the terms hereof of Two
Million One Hundred Thousand Dollars ($2,100,000).

                                   ARTICLE II
                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY
                  ---------------------------------------------

     The Company represents and warrants to the Investors as follows:

     SECTION 2.1  Organization,  etc. The Company and its Subsidiary (as defined
in Section 2.4(b)) have each been duly formed,  and are each validly existing as
a corporation  in good  standing  under the laws of their  respective  States of
incorporation, and are each 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 and its
Subsidiary taken as
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                                                             Page 15 of 36 Pages


a whole (a "Material Adverse Effect").  The Company and its Subsidiary each have
have the requisite corporate power and authority to own, lease and operate their
respective  properties and to conduct their  respective  businesses as presently
conducted.  The Company has the requisite corporate 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.

     SECTION 2.2 Authorization.  The execution, delivery and performance of this
Agreement  and the  issuance  of the  Shares  have been duly  authorized  by all
necessary  corporate  action  on the  part of the  Company,  including,  without
limitation,  the due authorization by the affirmative votes of a majority of the
disinterested directors of the Company's Board of Directors.

     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.

          (a) As of the date hereof, the authorized capital stock of the Company
consists of 40,000,000  shares of common  stock,  $0.01 par value per share (the
"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,  9,000,000  shares have been  designated  Series B Convertible
Preferred  Stock and 2,000  shares have been  designated  Series 2002  Preferred
Stock. Without giving effect to the transactions contemplated by this Agreement,
the  issued  and  outstanding  capital  stock  of the  Company  consists  of (i)
10,391,904  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.

          (b) The only Subsidiary of the Company is Clothesline Corporation. The
Company owns all of the issued and outstanding  capital stock of its Subsidiary,
free and clear of all  liens and  encumbrances.  All of such  shares of  capital
stock are duly authorized,  validly issued,  fully paid and non-assessable,  and
were issued in compliance with the registration and  qualification  requirements
of all  applicable  federal,  state and foreign  securities  laws.  There are no
options,  warrants,  conversion  privileges,  subscription or purchase rights or
other  rights  presently  outstanding  to  purchase  or  otherwise  acquire  any
authorized  but unissued,  unauthorized  or treasury  shares of capital stock or
other securities of, or any proprietary  interest in, the Company's  Subsidiary,
and  there  is  no  outstanding   security  of  any  kind  convertible  into  or
<PAGE>
                                                             Page 16 of 36 Pages


exchangeable for such shares or proprietary  interest.  "Subsidiary" means, with
respect to the Company,  a  corporation  or other entity of which 50% or more of
the voting power of the outstanding  voting equity  securities or 50% or more of
the outstanding economic equity interest is held, directly or indirectly, by the
Company.

     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 periodic and other filings  under the  Securities  Exchange Act of 1934, as
amended (the "Exchange Act"). 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 or its  Subsidiary
is a party or by which the Company or its Subsidiary or any of their  respective
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 or its Subsidiary,  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 have been validly  issued,
and, upon payment therefor, will be fully paid and non-assessable. The offering,
issuance,  sale and delivery of the Shares 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
<PAGE>
                                                             Page 17 of 36 Pages


Company and its  Subsidiary  (taken as a whole) or in the  assets,  liabilities,
properties  or business of the  Company and its  Subsidiary  (taken as a whole);
(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 its  Subsidiary  or  cancellation  of any material  debt or claim held by the
Company or its  Subsidiary;  (iv) material  loss,  destruction  or damage to any
property  of the  Company  or  its  Subsidiary,  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 or its
Subsidiary  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 or its Subsidiary to take any action of
the type, or any action that would result in an event of the type,  specified in
clauses (i) through (v).

     SECTION 2.9 Commission Filings.

(a) 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
consolidated  financial statements and unaudited interim consolidated  financial
statements  of the  Company  included  or  incorporated  by  reference  in  such
Commission  Filings have been prepared in  accordance  with  generally  accepted
accounting principles, consistently applied ("GAAP") (except as may be indicated
in the notes thereto or, in the case of the unaudited  consolidated  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 consolidated  financial position of the
Company and its Subsidiary as of the dates thereof and the results of operations
for the periods then ended (subject,  in the case of any unaudited  consolidated
interim financial  statements,  to the absence of footnotes required by GAAP and
normal year-end adjustments).

(b) The Company shall file as promptly as  practicable  with the  Commission its
Quarterly  Report on Form 10-Q for the quarterly period ended June 30, 2002 (the
"June  2002  10-Q"),  substantially  in the  form  previously  presented  to the
Investors.  The June 2002 10-Q shall  comply in all material  respects  with all
applicable  requirements  of the  Securities  Act  and/or the  Exchange  Act (as
applicable).  As of its date of filing, the June 2002 10-Q shall 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.
<PAGE>
                                                             Page 18 of 36 Pages


The unaudited  consolidated interim financial statements of the Company included
or  incorporated  by reference in the June 2002 10-Q shall have been prepared in
accordance  with GAAP  (except as may be  indicated  in the notes  thereto or as
permitted  by Form  10-Q),  shall  comply  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 shall fairly
present,  in all material respects,  the consolidated  financial position of the
Company and its Subsidiary as of the dates thereof and the results of operations
for the periods then ended (subject to the absence of footnotes required by GAAP
and normal year-end adjustments).

     SECTION  2.10  Brokers.  Neither  the  Company,  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.

                                  ARTICLE III
                 REPRESENTATIONS AND WARRANTIES OF THE INVESTORS

     Each  Investor  represents  and warrants to 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.

     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
to such  Investor  have not been  registered  under the  Securities  Act, or the
securities  laws of any state or regulatory  body, 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
<PAGE>
                                                             Page 19 of 36 Pages


registration under such laws unless an exemption is available. The certificates
representing  the 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 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.
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 is based on the
information  contained  herein,  the Commission  Filings and such Investor's own
independent investigation of the Company.
<PAGE>
                                                             Page 20 of 36 Pages


     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 an amendment to such  Investor's  Schedule 13D
under the Exchange Act with respect to its acquisition of the Shares.

     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,  in the case of clause (ii) above,  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.

                                   ARTICLE IV
                            SURVIVAL; INDEMNIFICATION

     SECTION 4.1  Survival.  The  representations  and  warranties  contained in
Articles II and III hereof shall survive until the first anniversary of the date
hereof.

     SECTION 4.2 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 (collectively,  "Losses"),  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 IV shall in no event
exceed fifty percent  (50%) of the purchase  price paid by such Investor for the
Shares  purchased by it and the  aggregate  liability of the Company  under this
Article IV shall in no event exceed fifty  percent  (50%) of the purchase  price
paid by the Investors for the Shares,  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.

     SECTION 4.3 Indemnification  Procedure.  The obligations and liabilities of
the Indemnifying Party under this Article IV with respect to Losses arising from
claims of any third
<PAGE>
                                                             Page 21 of 36 Pages


party that are subject to the  indemnification  provided for in this Article IV
("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 IV 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 IV. 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  counsel  to 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,
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.
<PAGE>
                                                             Page 22 of 36 Pages


                                   ARTICLE V
                                  MISCELLANEOUS

     SECTION 5.1 Change of Control  Provision.  For so long as any of the Shares
are owned by the Investors or their  affiliates,  the Company will not agree to,
or  take  any  action  to  approve  or  otherwise   facilitate  any,  merger  or
consolidation or Change of Control (including  granting approvals required under
applicable  anti-takeover  statutes),  unless  provision  has been  made for the
holders of the Shares to receive from the acquiror or any other person or entity
(other than the Company) as a result of and in connection  with the  transaction
an amount in cash equal to the aggregate  liquidation  preference for the Shares
held  by  them,  as  set  forth  in the  Certificate  of  Powers,  Designations,
Preferences  and Rights of the Series 2002 Preferred  Stock.  The parties hereto
agree that  irreparable  damage would occur in the event that the  provisions of
this  Section  5.1 were not  performed  in  accordance  with their terms and the
Investors shall be entitled to specific performance of the terms of this Section
5.1 in addition to any other remedies at law or in equity.  For purposes of this
Section  5.1: a "Change of  Control"  shall  mean any of the  following  (i) any
person or "group"  (within the meaning of Section  13(d)(3) of the Exchange Act)
becoming the beneficial owner, directly or indirectly,  of outstanding shares of
Capital Stock of the Company entitling such Person or Persons to exercise 50% or
more of the total votes entitled to be cast at a regular or special meeting,  or
by action by written consent, of the shareholders of the Company in the election
of directors (the term "beneficial owner" shall be determined in accordance with
Rule 13d-3 of the  Exchange  Act),  (ii) a majority of the Board of Directors of
the Company shall consist of Persons other than  Continuing  Directors,  (iii) a
recapitalization,  reorganization, merger, consolidation or similar transaction,
in each case with respect to which all or substantially  all the Persons who are
the respective  beneficial  owners,  directly or indirectly,  of the outstanding
shares   of   Capital   Stock  of  the   Company   immediately   prior  to  such
recapitalization,  reorganization, merger, consolidation or similar transaction,
will own less  than 50% of the  combined  voting  power of the then  outstanding
shares of Capital  Stock of the Company  resulting  from such  recapitalization,
reorganization,  merger, consolidation or similar transaction,  (iv) the sale or
other  disposition of all or substantially  all the assets of the Company in one
transaction or in a series of related  transactions,  (v) any transaction occurs
(other  than one  described  in (iv) or (v))),  the  result of which is that the
Common Stock is not required to be  registered  under Section 12 of the Exchange
Act and in which the  holders  of Common  Stock of the  Company  do not  receive
common stock of the Person  surviving such  transaction  which is required to be
registered under Section 12 of the Exchange Act, or (vi)  immediately  after any
merger,  consolidation,  recapitalization  or  similar  transaction,  a  "group"
(within the meaning of Section 13(d)(3) of the Exchange Act), other than a group
that includes the Investors  and/or their  affiliates,  shall be the  beneficial
owners,  directly or indirectly,  of outstanding  shares of Capital Stock of the
Company (or any Person surviving such  transaction)  entitling them collectively
to exercise 50% or more of the total voting power of shares of Capital  Stock of
the Company (or the surviving Person in such transaction) and in connection with
or as a result of such transaction, the Company (or such surviving Person) shall
have incurred or issued additional indebtedness such that the total indebtedness
so incurred or issued equals at least 50% of the  consideration  payable in such
transaction; "Capital Stock" shall mean, with
<PAGE>
                                                             Page 23 of 36 Pages


respect to the Company, any and all shares, interests,  participations,  rights
in, or other equivalents  (however  designated and whether voting or non-voting)
of, the Company's  capital stock; and "Person" shall mean any individual,  firm,
corporation,  partnership,  limited liability  company,  trust,  incorporated or
unincorporated  association,  joint venture,  joint stock company,  governmental
authority  or other  entity of any kind,  and shall  include any  successor  (by
merger or otherwise) of such entity;  and "Continuing  Directors" shall mean any
member of the Board of  Directors on the date hereof and any other member of the
Board of Directors  who shall be  recommended  or elected to succeed or become a
Continuing  Director  by a majority  of the  Continuing  Directors  who are then
members of the Board of Directors.

     SECTION 5.2  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.

     SECTION 5.3 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 5.4  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  5.5  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  5.6  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.
<PAGE>
                                                             Page 24 of 36 Pages


     SECTION 5.7 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) 840-1903
                               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.


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

     SECTION 5.8 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  5.9  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.  The parties  agree that the federal and
state courts  located in New York,  New York shall have  exclusive  jurisdiction
over any dispute  involving  this  Agreement  or the  transactions  contemplated
hereby,  and each party hereby  irrevocably  submits to the jurisdiction of, and
waives any objection to the laying of venue in, such courts.

     SECTION 5.10  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
<PAGE>
                                                             Page 25 of 36 Pages


 delivered to the other parties,  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.

     SECTION 5.11 Expenses.  The Company shall reimburse the Investors for their
reasonable  legal fees and expenses  incurred in connection with the negotiation
of this Agreement and the transactions  contemplated hereby.  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.
<PAGE>
                                                             Page 26 of 36 Pages


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

                                      BLUEFLY, INC.

                                      By:      ___________________________
                                               Name:
                                               Title:

                                      QUANTUM INDUSTRIAL PARTNERS LDC



                                      By:      ___________________________
                                               Name:
                                               Title:

                                      SFM DOMESTIC INVESTMENTS LLC



                                      By:      ___________________________
                                               Name:
                                               Title:


<PAGE>
                                                             Page 27 of 36 Pages


                                   SCHEDULE 1

                         INVESTORS AND SHARE ALLOCATIONS
--------------------------------------------------------------------------------
                                                             Aggregate Purchase
Name and Address of Investor             Shares Purchased    Price
----------------------------             ----------------    ------
--------------------------------------------------------------------------------
Quantum Industrial Partners LDC          2,033.43            $2,033,430
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                 66.57           $      66,570
c/o Soros Fund Management LLC
888 Fifth Avenue
New York, New York 10106
Facsimile:  (212) 664-0544
Attn:  Richard Holahan, Esq.
--------------------------------------------------------------------------------
                                  TOTAL  2,100               $2,100,000
--------------------------------------------------------------------------------


<PAGE>
                                                             Page 28 of 36 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 13,281,038 shares of Common Stock.

     3.   Warrants to purchase an aggregate of 1,069,144  shares of Common Stock
          are issued and outstanding.

     4.   Options issued to purchase 3,935,912 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.


