Exhibit
10.5

      PLEDGE
AGREEMENT

       

      PLEDGE
AGREEMENT (this “Agreement”), dated as
of January 4, 2011, by and between BLUEFLY, INC. (the “Borrower”), a
Delaware corporation with its principal executive offices at 42 West 39th
Street, New York, New York 10018, and WELLS FARGO BANK, NATIONAL ASSOCIATION
(successor by merger to Wells Fargo Retail Finance, LLC) (herein, the “Lender”), with
offices at One Boston Place, 19th Floor, Boston, Massachusetts 02109, in
consideration of the mutual covenants contained herein and benefits to be
derived herefrom.

       

      WITNESSETH:

       

      Reference
is made to the Loan and Security Agreement dated as of July 26, 2005 (as
amended, modified, supplemented or restated and in effect from time to time, the
“Loan
Agreement”) by and between the Borrower and the Lender.

       

      Reference
is also made to the Eighth Amendment to Loan and Security Agreement dated as of
even date herewith by and between the Borrower and the Lender (the “Eighth Amendment”),
pursuant to which the Lender has permitted the Borrower to enter into a certain
Operating Agreement of Eyefly, LLC with A+D Labs LLC pursuant which the Borrower
and Modo will form Eyefly, LLC.

       

      The
obligation of the Lender to enter into the Eighth Amendment is conditioned upon,
among other things, the execution and delivery by the Borrower of an agreement
in the form hereof, pursuant to which the Borrower grants to the Lender a
security interest in and to the Pledged Collateral (as defined herein), in order
to secure the Liabilities.

       

      NOW,
THEREFORE, in consideration of the mutual conditions and agreements set forth in
this Agreement, and for good and valuable consideration, the receipt of which is
hereby acknowledged, the Borrower and the Lender hereby agree as
follows:

       

      SECTION
1

       

      Definitions

       

      1.1           Generally.  All
references herein to the UCC shall mean the Uniform Commercial Code as in effect
from time to time in the Commonwealth of Massachusetts; provided, however, that if a
term is defined in Article 9 of the UCC differently than in another Article
thereof, the term shall have the meaning set forth in Article 9.

       

      1.2           Definitions of Certain Terms
Used Herein.  Unless the context otherwise requires, all
capitalized terms used but not defined herein shall have the meanings set forth
in the Loan Agreement.  In addition, as used herein, the following
terms shall have the following meanings:

       

      
        
           


        

        
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      “Pledged Collateral”
shall have the meaning assigned to such term in Section 2.5 of this
Agreement.

       

      “Pledged Securities”
shall have the meaning assigned to such term in Section 2.1 of this
Agreement.

       

      SECTION
2

       

      Pledge

       

      As
security for the payment or performance, as the case may be, in full of the
Liabilities, the Borrower hereby transfers, grants, bargains, sells, conveys,
hypothecates, pledges sets over and delivers unto the Lender, its successors and
assigns, and hereby grants to the Lender, its successors and assigns, a security
interest in all of the Borrower’s right, title and interest in, to and
under:

       

      2.1           all
shares of capital stock, limited liability company membership interests and
other equity interests owned by such Borrower in each entity designated as an
“Issuer” on Schedule I
hereto, and any shares of capital stock, limited liability company membership
interests or other equity interests obtained in the future by the Borrower, and
the stock certificates or other security certificates (as defined in the UCC)
representing all such shares, membership interests or other equity interests
(the “Pledged
Securities”);

       

      2.2           all
other Investment Property that may be delivered to, and held by, the Lender
pursuant to the terms hereof;

       

      2.3           subject
to Section 6, all dividends, cash, instruments and other property from time to
time received, receivable or otherwise distributed or distributable, in respect
of, or in exchange for, the Pledged Securities and other Investment Property
referred to in clauses 2.1 and 2.2 above;

       

      2.4           subject
to Section 6, all rights and privileges of the Borrower with respect to the
Pledged Securities and other Investment Property referred to in
clauses 2.1, 2.2, and 2.3 above; and

       

      2.5           all
proceeds of any of the foregoing (the items referred to in clauses 2.1
through 2.4 being collectively referred to as the “Pledged
Collateral”).

       

      TO HAVE
AND TO HOLD the Pledged Collateral, together with all right, title, interest,
powers, privileges and preferences pertaining or incidental thereto, unto the
Lender, its successors and assigns, until all of the Liabilities have been
indefeasibly paid in full in cash; subject, however, to the
terms, covenants and conditions hereinafter set forth.

       

      Upon
delivery to the Lender pursuant to Section 3 of this Agreement, (a) all
stock certificates or other securities now or hereafter included in the Pledged
Securities shall be

       

      
        
           


        

        
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      accompanied
by stock powers duly executed in blank or other instruments of transfer
reasonably satisfactory to the Lender and by such other instruments and
documents as the Lender may reasonably request, and (b) all other
Investment Property comprising part of the Pledged Collateral shall be
accompanied by proper instruments of assignment duly executed by the Borrower
and such other instruments or documents as the Lender may reasonably
request.  Each delivery of Pledged Securities shall be accompanied by
a schedule describing the Pledged Securities theretofore and then being pledged
hereunder, which schedule shall be attached hereto as Schedule I and
made a part hereof.  Each schedule so delivered shall supersede any
prior schedules so delivered.

       

      SECTION
3

       

      Delivery of the Pledged
Collateral

       

      3.1           On
or before the Eight Amendment Effective Date, the Borrower shall deliver or
cause to be delivered to the Lender any and all Pledged Securities, any and all
Investment Property, and any and all original certificates or other instruments
or documents representing the Pledged Collateral.

       

      3.2           After
the Eighth Amendment Effective Date, promptly upon the Borrower’s acquiring any
Pledged Securities, and any original certificates or other instruments or
documents representing such Pledged Collateral, the Borrower shall deliver or
cause to be delivered such Pledged Collateral to the Lender.

       

      3.3           The
Borrower hereby irrevocably authorizes the Lender, at any time and from time to
time, to sign (if required) and file in any appropriate filing office, wherever
located, any financing statement that contains any information required by the
UCC of the applicable jurisdiction for the sufficiency or filing office
acceptance of any financing statement.  The Borrower also authorizes
the Lender to file a copy of this Agreement in lieu of a financing statement,
and to take any and all actions required by any earlier versions of the UCC or
by any other Applicable Law.  The Borrower shall provide the Lender
with any information the Lender shall reasonably request in connection with any
of the foregoing.

       

      SECTION
4

       

      Representations, Warranties
and Covenants

       

      The
Borrower hereby represents, warrants and covenants, as to itself and the Pledged
Collateral pledged by it hereunder, to and with the Lender that:

       

      4.1           the
Pledged Securities represent that percentage of the issued and outstanding
shares of each class of the capital stock, membership interest or other equity
interest of the Issuer with respect thereto as set forth on Schedule I;

       

      
        
           


        

        
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      4.2           except
for the security interest granted hereunder, and except as otherwise permitted
in the Loan Agreement and the other Loan Documents, the Borrower (i) is and
will at all times continue to be the direct owner, beneficially and of record,
of the Pledged Securities indicated on Schedule I,
(ii) holds the Pledged Collateral free and clear of all Encumbrances, other
than Encumbrances in favor of the Lender, (iii) will make no assignment,
pledge, hypothecation or transfer of, or create or permit to exist any security
interest in, or other Encumbrance on, the Pledged Collateral, other than
pursuant hereto, and (iv) other than as permitted in Section 6, will cause any
and all distributions in cash or in kind made on the Pledged Collateral to be
forthwith deposited with the Lender and pledged or assigned
hereunder;

       

      4.3           the
Borrower (i) has the power and authority to pledge the Pledged Collateral
in the manner hereby done or contemplated and (ii) will defend its title or
interest thereto or therein against any and all Encumbrances (other than
Encumbrances in favor of the Lender), however arising, of all Persons
whomsoever;

       

      4.4           except
for consents or approvals already obtained, no consent of any other Person
(including creditors of such Borrower), and no consent or approval of any
Governmental Authority or any securities exchange, was or is necessary to the
validity of the pledge effected hereby or to the disposition of the Pledged
Collateral upon an Event of Default in accordance with the terms of this
Agreement;

       

      4.5           by
virtue of the execution and delivery by the Borrower of this Agreement, and the
delivery by the Borrower to the Lender of the stock certificates or other
certificates or documents representing or evidencing the Pledged Collateral in
accordance with the terms of this Agreement, the Lender will obtain a valid and
perfected first priority Encumbrance upon, and security interest in, the Pledged
Collateral as security for the payment and performance of the
Liabilities;

       

      4.6           the
pledge effected hereby is effective to vest in the Lender the rights of the
Lender in the Pledged Collateral as set forth herein;

       

      4.7           all
of the Pledged Securities have been duly authorized and validly issued and, to
the extent applicable, are fully paid and nonassessable;

       

      4.8           all
information set forth herein relating to the Pledged Collateral is accurate and
complete in all material respects as of the date hereof; and

       

      4.9           none
of the Pledged Securities constitutes margin stock, as defined in Regulation U
of the Board of Governors of the Federal Reserve System.

       

      SECTION
5

       

      
        
           


        

        
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      Registration in Nominee
Name; Copies of Notices

       

      Upon the
occurrence and during the continuance of an Event of Default, the Lender shall
have the right (in its reasonable discretion) to hold the Pledged Securities in
its own name as pledgee, the name of its nominee (as pledgee or as sub-agent) or
the name of the Borrower, endorsed or assigned in blank or in favor of the
Lender.  The Borrower will promptly give to the Lender copies of any
notices or other communications received by it with respect to Pledged
Securities registered in the name of the Borrower.

       

      SECTION
6

       

      Voting Rights; Dividends and
Interest, Etc.

       

      6.1           Unless
and until an Event of Default has occurred and is continuing, the Borrower shall
be entitled to exercise any and all voting and/or other consensual rights and
powers inuring to an owner of the Pledged Securities or any part thereof to the
extent, and only to the extent, that such rights are exercised for any purpose
consistent with, and not otherwise in violation of, the terms and conditions of
this Agreement, the Loan Agreement, the other Loan Documents and Applicable Law;
provided, however, that the
Borrower will not be entitled to exercise any such right if the result thereof
could reasonably be expected to materially and adversely affect the rights
inuring to a holder of the Pledged Securities or the rights and remedies of the
Lender under this Agreement, the Loan Agreement or any other Loan Document or
the ability of the Lender to exercise the same.

       

      6.2           Unless
and until an Event of Default has occurred and is continuing, the Borrower shall
be entitled to receive and retain any and all cash dividends or other cash
distributions paid on the Pledged Collateral to the extent, and only to the
extent, that such cash dividends or other cash distributions are permitted by,
and otherwise paid in accordance with, the terms and conditions of this
Agreement, the Loan Agreement, the other Loan Documents and Applicable
Law.  All noncash dividends, and all dividends paid or payable in cash
or otherwise in connection with a partial or total liquidation or dissolution,
return of capital, capital surplus or paid-in surplus, and all other
distributions (other than dividends and distributions referred to in the
preceding sentence) made on or in respect of the Pledged Collateral, whether
paid or payable in cash or otherwise, whether resulting from a subdivision,
combination or reclassification of the outstanding capital stock, membership
interests or other equity interests of the Issuer of any Pledged Securities or
received in exchange for Pledged Securities or any part thereof, or in
redemption thereof, or as a result of any merger, amalgamation, arrangement,
consolidation, acquisition or other exchange of assets to which such Issuer may
be a party or otherwise, shall be and become part of the Pledged Collateral,
and, if received by the Borrower, to the extent required to be paid to the
Lender pursuant to the terms of the Loan Agreement or the other Loan Documents,
shall not be commingled by the Borrower with any of its other funds or property
but shall be held separate and apart therefrom, shall be held in trust for the
benefit of the Lender and shall be forthwith delivered to the Lender in the same
form as so received (with any necessary endorsement).

       

      
        
           


        

        
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      6.3           Upon
the occurrence and during the continuance of an Event of Default, all rights of
the Borrower to dividends or other cash distributions that the Borrower is
authorized to receive pursuant to Section 6.2 above shall cease, and all such
rights shall thereupon become vested in the Lender, which shall have the sole
and exclusive right and authority to receive and retain such dividends or other
cash distributions.  All dividends or other cash distributions
received by the Borrower contrary to the provisions of this Section 6.3
shall be held in trust for the benefit of the Lender, shall be segregated from
other property or funds of the Borrower and shall be forthwith delivered to the
Lender in the same form as so received (with any necessary
endorsement).  Any and all money and other property paid over to or
received by the Lender pursuant to the provisions of this Section 6.3 shall be
applied in accordance with the provisions of Section 8.

       

      6.4           Upon
the occurrence and during the continuance of an Event of Default, all rights of
the Borrower to exercise the voting and consensual rights and powers it is
entitled to exercise pursuant to Section 6.1 shall cease, and all such rights
shall thereupon become vested in the Lender, which shall have the sole and
exclusive right and authority to exercise such voting and consensual rights and
powers; provided that the
Lender shall have the right from time to time following and during the
continuance of an Event of Default to permit the Borrower to exercise such
rights.  After all Events of Default have been cured or waived in
writing by the Lender, the Borrower will have the right to exercise the voting
and consensual rights and powers that it would otherwise be entitled to exercise
pursuant to the terms of Section 6.1.

       

      SECTION
7

       

      Remedies upon
Default

       

      Upon the
occurrence and during the continuance of an Event of Default, it is agreed that
the Lender shall have in any jurisdiction in which enforcement hereof is sought,
in addition to all other rights and remedies, the rights and remedies of a
secured party under the UCC or other Applicable Law.  The rights and
remedies of the Lender shall include, without limitation, the right to take any
or all of the following actions at the same or different times:

       

      7.1           The
Lender may sell or otherwise dispose of all or any part of the Pledged
Collateral, at public or private sale or at any broker’s board or on any
securities exchange, for cash, upon credit or for future delivery as the Lender
shall deem appropriate.  Each purchaser at any such sale shall hold
the property sold absolutely, free from any claim or right on the part of the
Borrower.

       

      7.2           The
Lender shall give the Borrower at least ten (10) days’ prior written notice, by
authenticated record, of the Lender’s intention to make any sale of the Pledged
Collateral.  Such notice, (i) in the case of a public sale, shall
state the date, time and place for such sale, (ii) in the case of a sale at a
broker’s board or on a securities exchange, shall state the board or exchange at
which such sale is to be made and the day on which the Pledged Collateral, or
portion thereof, will first be offered for sale at such board or exchange, and
(iii) in the case of a private sale, shall

       

      
        
           


        

        
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      state the
date after which any private sale or other disposition of the Pledged Collateral
shall be made.  The Borrower agrees that such written notice shall
satisfy all requirements for notice to the Borrower which are imposed under the
UCC with respect to the exercise of the Lender’s rights and remedies upon
default.  The Lender shall not be obligated to make any sale or other
disposition of any Pledged Collateral if it shall determine not to do so,
regardless of the fact that notice of sale or other disposition of such Pledged
Collateral shall have been given. The Lender may, without notice or publication,
adjourn any public or private sale or cause the same to be adjourned from time
to time by announcement at the time and place fixed for sale, and such sale may,
without further notice, be made at the time and place to which the same was so
adjourned.

       

      7.3           Any
public sale shall be held at such time or times within ordinary business hours
and at such place or places as the Lender may fix and state in the notice of
such sale.

       

      7.4           At
any public (or, to the extent permitted by Applicable Law, private) sale made
pursuant to this Section 7, the Lender may bid for or purchase, free (to the
extent permitted by Applicable Law) from any right of redemption, stay,
valuation or appraisal on the part of the Borrower, the Pledged Collateral or
any part thereof offered for sale and may make payment on account thereof by
using any claim then due and payable to the Lender from the Borrower on account
of the Liabilities as a credit against the purchase price, and the Lender may,
upon compliance with the terms of sale, hold, retain and dispose of such
property free from any claim or right on the part of the Borrower
therein.

       

      7.5           For
purposes hereof, a written agreement to purchase the Pledged Collateral or any
portion thereof shall be treated as a sale thereof.  The Lender shall
be free to carry out such sale pursuant to such agreement and the Borrower shall
not be entitled to the return of the Pledged Collateral or any portion thereof
subject thereto, notwithstanding the fact that after the Lender shall have
entered into such an agreement all Events of Default shall have been remedied
and the Liabilities paid in full.

       

      7.6           As
an alternative to exercising the power of sale herein conferred upon it, the
Lender may proceed by a suit or suits at law or in equity to foreclose upon the
Pledged Collateral and to sell the Pledged Collateral or any portion thereof
pursuant to a judgment or decree of a court or courts having competent
jurisdiction or pursuant to a proceeding by a court-appointed
receiver.

       

      7.7           To
the extent permitted by Applicable Law, the Borrower hereby waives all rights of
redemption, stay, valuation and appraisal which the Borrower now has or may at
any time in the future have under any rule of law or statute now existing or
hereafter enacted.  In dealing with or disposing of the Pledged
Collateral or any part thereof, the Lender shall not be required to give
priority or preference to any item of Pledged Collateral or otherwise to marshal
assets or to take possession or sell any Pledged Collateral with judicial
process.

       

      SECTION
8

       

      
        
           


        

        
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      Application of Proceeds of
Sale

       

      After the
occurrence and during the continuance of an Event of Default and acceleration of
the Liabilities, the Lender shall apply the proceeds of any collection or sale
of the Pledged Collateral, as well as any Pledged Collateral consisting of cash,
in accordance with the Loan Agreement.

       

      The
Lender shall have absolute discretion as to the time of application of any such
proceeds, moneys or balances in accordance with this Agreement.  Upon
any sale or other disposition of the Pledged Collateral by the Lender (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the purchase money by the Lender or of the officer making the
sale or other disposition shall be a sufficient discharge to the purchaser or
purchasers of the Pledged Collateral so sold or otherwise disposed of and such
purchaser or purchasers shall not be obligated to see to the application of any
part of the purchase money paid over to the Lender or such officer or be
answerable in any way for the misapplication thereof.

       

      SECTION
9

       

      Further
Assurances

       

      The
Borrower agrees to do such further acts and things, and to execute and deliver
such additional conveyances, assignments, agreements and instruments, as the
Lender may at any time reasonably request in connection with the administration
and enforcement of this Agreement or with respect to the Pledged Collateral or
any part thereof or in order better to assure and confirm unto the Lender its
rights and remedies hereunder.

       

      SECTION
10

       

      Miscellaneous

       

      10.1           Notices.  All
communications and notices hereunder shall (except as otherwise expressly
permitted herein) be in writing and given as provided in the Loan
Agreement.

       

      10.2           Survival of
Agreement.  All covenants, agreements, representations and
warranties made by the Borrower herein and in any other Loan Document and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lender and shall survive the execution and delivery
of this Agreement and the other Loan Documents, regardless of any investigation
made by any such other party or on its behalf and notwithstanding that the
Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended under the Loan
Agreement, and shall continue in full force and effect unless terminated in
accordance with Section 10.9 hereof.

       

      
        
           


        

        
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      10.3           Binding Effect; Several
Agreement; Assignments.  Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
successors and assigns of such party, and all covenants, promises and agreements
by or on behalf of the Borrower that are contained in this Agreement shall bind
and inure to the benefit of the Borrower and its successors and
assigns.  This Agreement shall be binding upon the Borrower and the
Lender and their respective successors and assigns, and shall inure to the
benefit of the Borrower, the Lender and their respective successors and assigns,
except that the Borrower shall not have the right to assign or transfer its
rights or obligations hereunder or any interest herein or in the Pledged
Collateral (and any such attempted assignment or transfer shall be void) except
as expressly permitted by this Agreement or the Loan Agreement.

       

      10.4           Governing
Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS, WITHOUT GIVING
EFFECT TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.

       

      10.5           WAIVER OF JURY
TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT TO A JURY IN ANY TRIAL OF ANY CASE OR
CONTROVERSY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY) IN WHICH THE
BORROWER, THE LENDER OR ANY PARTICIPANT  IS OR BECOMES A PARTY
(WHETHER SUCH CASE OR CONTROVERSY IS INITIATED BY OR AGAINST THE BORROWER, THE
LENDER OR PARTICIPANT OR IN WHICH THE BORROWER, THE LENDER OR PARTICIPANT IS
JOINED AS A PARTY LITIGANT), WHICH CASE OR CONTROVERSY ARISES OUT OF OR IS IN
RESPECT OF, ANY RELATIONSHIP AMONGST OR BETWEEN THE BORROWER OR ANY OTHER PERSON
AND THE LENDER OR PARTICIPANT OR THE ACTIONS OF THE LENDER IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT THEREOF.  EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

       

      10.6           Severability.  Any
provision of this Agreement held to be invalid, illegal or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such invalidity, illegality or unenforceability without affecting the validity,
legality and enforceability of the remaining provisions hereof, and the
invalidity of a particular provision in a particular jurisdiction shall not
invalidate such provision in any other jurisdiction.

       

      10.7           Counterparts; Integration;
Effectiveness.  This Agreement may be executed in counterparts
(and by different parties hereto on different counterparts), each of which
shall

       

      
        
           


        

        
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      constitute
an original, but all of which when taken together shall constitute a single
contract. This Agreement and the other Loan Documents constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all contemporaneous or previous agreements and understandings, oral or
written, relating to the subject matter hereof.  Delivery of an
executed counterpart of a signature page of this Agreement by telecopy or e-mail
shall be effective as delivery of a manually executed counterpart of this
Agreement.

       

      10.8         Headings.  Article
and Section headings used herein are for convenience of reference only, are not
part of this Agreement and shall not affect the construction of, or be taken
into consideration in interpreting, this Agreement.

       

      10.9         Termination; Release of
Pledged Collateral.

       

      (a)           Any
Encumbrance upon any Pledged Collateral will be released automatically if the
Pledged Collateral constitutes property being sold, transferred or disposed of
as permitted by the Loan Agreement upon receipt by the Lender of the proceeds
thereof to the extent required by the Loan Agreement.  Upon written
request by the Borrower, the Lender shall execute such documents as may be
necessary to evidence the release of the Encumbrances upon any Pledged
Collateral described in this Section 10.19(a); provided, however, that (i) the
Lender shall not be required to execute any such document on terms which, in its
reasonable opinion, would, under Applicable Law, expose the Lender to liability
or create any obligation or entail any adverse consequence other than the
release of such Encumbrances without recourse or warranty, and (ii) such release
shall not in any manner discharge, affect or impair the Liabilities or any
Encumbrances (other than those expressly being released) upon (or obligations of
the Borrower in respect of) all interests retained by the Borrower, including,
without limitation, the proceeds of any sale, all of which shall continue to
constitute part of the Pledged Collateral.

       

      (b)           Except
for those provisions which expressly survive the termination thereof, this
Agreement and the security interest granted herein shall terminate when the
principal of and interest on the Revolving Credit Loans and all fees and other
Liabilities shall have been paid in full, at which time the Lender shall execute
and deliver to the Borrower, at the Borrower’s expense, all UCC termination
statements, releases and similar documents that the Borrower shall reasonably
request to evidence such termination; provided, however, that the
Loan Agreement, this Agreement, and the security interest granted herein shall
be reinstated if at any time payment, or any part thereof, of any of the
Liabilities is rescinded or must otherwise be restored by the Lender upon the
bankruptcy or reorganization of the Borrower.  Any execution and
delivery of termination statements, releases or other documents pursuant to this
Section 10.9 shall be without recourse to, or warranty by, the
Lender.

       

      [SIGNATURE PAGE
FOLLOWS]


      
        
           


        

        
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      IN
WITNESS WHEREOF, the parties hereto have duly executed this Agreement under seal
as of the day and year first above written.

       

      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                	

                                        BORROWER:

                                      	BLUEFLY,
      INC.	 
	 	 
      	 
      	 
	 	
                                        By:

                                      	
                                        / s
      / Kara B. Jenny
      

                                      	 
	 	
                                        Name:  

                                      	
                                        Kara
      B.
      Jenny

                                      	 
	 	
                                        Title:

                                      	
                                        CFO

                                      	 
	 	 
      	 
      	 
	

                                        LENDER:

                                      	
                                        WELLS
      FARGO BANK, NATIONAL

                                        ASSOCIATION

                                      	 
	 	 
      	 
      	 
	 	
                                        By:

                                      	
                                        / s
      / Michele L.
      Ayou

                                      	 
	 	
                                        Name:  

                                      	
                                        Michele
      L.
      Ayou

                                      	 
	 	
                                        Title:

                                      	
                                        Authorized
      Signatory

                                      	 


                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      


      
        
           


        

        
          -11-

          
            

          

        

        
           


        

      


      SCHEDULE
I

       

      
        
          
            
              
                
                  
                    
                      
                        	
                                Issuer

                              	 	
                                Class of

                                equity

                                interests

                              	 	
                                Cert. #s

                              	 	 	
                                Number of

                                Units owned

                                by Borrower

                              	 	 	
                                # of Issued

                                and

                                Outstanding

                                Units

                              	 	 	
                                % of Units

                                held by

                                Borrower

                              	 
	
                                Eyefly,
      LLC

                              	 	
                                Limited
      liability company membership interests

                              	 	 	[N/A	]	 	 	4,420,000	 	 	 	8,500,000	 	 	 	52	%


                      

                    

                  

                

              

            

          

        

      

       

      
        
           


        

        
          -12-