ITEM 5.02. DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

On October 5, 2009, the Compensation Committee (the "Committee") of the Board of Directors (the "Board") of Bluefly, Inc. (the "Company") approved the adoption of a cash bonus plan for fiscal 2009 (the "Bonus Plan") for Melissa Payner-Gregor, the Company's Chief Executive Officer (the "CEO"), and Kara Jenny, the Company's Chief Financial Officer (the "CFO"). The Bonus Plan provides for the payment of a cash bonus to the CEO in the amount of $125,000 to be paid this week and cash bonuses of $75,000 to the CEO and $33,000 to the CFO to be paid promptly after the Company's fiscal year end, subject to certain conditions, including their respective continued employment at fiscal year end. The Bonus Plan also provides for contingent bonus payments to the CEO and CFO if the Company achieves specified adjusted EBITDA target levels. The range of the contingent bonuses which may become payable under the Bonus Plan is between zero and $180,000 for the CEO and between zero and $60,000 for the CFO. The contingent bonus payments, if any, are payable as soon as practicable following the availability of the Company's audited financial statements (but in no event later than March 15, 2010), subject to the respective continued employment of the CEO and CFO at fiscal year end. The Bonus Plan is not in limitation of additional discretionary bonuses for performance above the specified target levels.

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