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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

                                   (Mark One)
  (X) ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934

                   For the Fiscal Year Ended February 2, 2002

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

    ( ) TRANSITIONAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

             For the transition period from __________ to __________

                         Commission File Number: 1-14987

                                     ------

                                    TOO, INC.
 -------------------------------------------------------------------------------
             (Exact name of Registrant as specified in its charter)

            Delaware                                             31-1333930
 ------------------------------                        -----------------------
(State or other jurisdiction of                            (I.R.S. Employer
 incorporation or organization)                         Identification Number)

                   8323 Walton Parkway, New Albany, Ohio 43054
             -------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

         Registrant's telephone number, including area code 614-775-3500
                                  ------------
           Securities registered pursuant to Section 12(b) of the Act:
                        -----------------------------------

      Title of each class             Name of each exchange on which registered
  -----------------------------        ---------------------------------------
  Common Shares, $.01 par value                 New York Stock Exchange


        Securities registered pursuant to Section 12(g) of the Act: None
          ------------------------------------------------------------

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Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.

                                     YES  X    NO ___
                                         ---

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. X
          ---

The aggregate market value of the voting stock held by non-affiliates of the
Registrant at March 28, 2002 was $921,314,224. There were 31,241,581 shares
of the Registrant's common stock outstanding at March 28, 2002.

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                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of our annual report to shareholders for the fiscal year ended February
2, 2002 are incorporated by reference into Part I and Part II and portions of
our proxy statement for the Annual Meeting of Stockholders scheduled for May 21,
2002 are incorporated by reference into Part III.

PART I

ITEM  1. BUSINESS

Overview

   For the purposes of this Form 10-K, unless the context otherwise requires,
"Too, Inc.," "Too," "we," "our," "the Company" and "us" refer to Too, Inc. and
our subsidiaries.

   We are a leading specialty retailer of branded apparel and lifestyle
products for 'tween girls, ages 7 to 14, and recently introduced a new retail
concept for teen girls ages 14 to 19. As of February 2, 2002, we operated 459
Limited Too stores, targeting the 'tween segment, and seven mishmash stores,
targeting the teen girl segment. We design, source and market our products
under our proprietary brands, Limited Too and mishmash, for sale exclusively in
our stores. Our sales strategy is to integrate our retail, direct mail and
website channels, to provide marketing vehicles and sources for the latest
fashion and trends. Both store concepts are located primarily in high-traffic
mall locations.

   Our store design, merchandise assortments and marketing initiatives are
intended to create lifestyle brands that capture the latest trends for our
fashion-aware customers. With Limited Too, we have created destination retail
stores that showcase our brands and the scope of our product offerings,
encouraging customers to spend time experimenting with and trying on products
before making purchases. We believe our target customers want a broad
assortment of merchandise for their wardrobes, including apparel for school,
leisure and special occasions, as well as non-apparel merchandise, such as
footwear, candy, jewelry, cosmetics and lifestyle products. We have
historically relied on colorful in-store graphics and window displays to convey
our fun and "cool" image. We intend to leverage these successful marketing
efforts to continue to promote brand awareness on a national level, including
engaging in cross-promotions with major media companies such as Disney and
Universal Studios and consumer product companies.

   In 1996, our management team recognized that our core customer had her own
emerging sense of style and revised our strategy to focus on girls 7 to 14
years of age as our target customer group. Since then, we have implemented an
aggressive store opening campaign to capitalize on our business strengths and
have grown our Limited Too store base from 308 stores at the end of fiscal 1996
to 459 stores in 46 states at the end of fiscal 2001. Our net sales have
increased at a compound annual growth rate in excess of 18%, from $256.7
million in fiscal 1996 to $602.7 million in fiscal 2001. Over the same period,
our operating income rate has increased from (3.5%) to 11.0%. We intend to
continue our expansion program and plan to open approximately 50 to 55 new
Limited Too stores in fiscal 2002 and remodel about 10 stores to enhance their
sales and profitability. We expect to open these stores in our existing markets
as well as in markets in which we do not currently have a presence.
Additionally, we intend to continue to develop our mishmash concept. Based on
positive customer response to our first seven mishmash stores, we plan to open
at least four more mishmash stores in fiscal 2002 and 30 to 50 stores during
fiscal 2003.

Our Competitive Strengths

   We combine our trend-sensitive design capabilities and our
vertically-integrated operations to design and market products for
fashion-aware 'tween and teen girls. We attribute our success to date and our
opportunities to increase sales, profits and market share to the following
strengths:

   Customer focus. A cornerstone of our business strength has been our ability
to develop, cultivate and satisfy a base of loyal, repeat customers. By staying
close to our customers, we have developed a detailed knowledge of the fashion
tastes, purchasing habits and attitudes of the

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'tween girl consumer. We conduct focus groups, hang out at malls, shop the
competition and attend concerts to observe and interact with our customers. Our
internal database includes over six million customer names. Approximately 2.5
million of these customers have made purchases from us in the past 12 months.
We believe our knowledge of the customer allows us to rapidly respond to her
evolving needs and provide her with unique and fashionable merchandise as she
grows older and into our mishmash concept.

   Brand development expertise. We believe our unique merchandising and
creative marketing have made Limited Too a focused and differentiated brand
within the 'tween segment. Our Limited Too brand appeal is driven by, augmented
by and should continue to benefit from, trends that emphasize the latest
fashions and the aspirational lifestyle of today's 'tween girls who want to
look and dress like older girls who wear the latest trends in junior fashions.
We have demonstrated an ability to effectively communicate this brand image
through all aspects of our business, including store environments, merchandise
assortments, direct mail and our website. We believe our integrated approach to
brand management provides us the opportunity to cross-sell and increase our
penetration of current merchandise categories and facilitates entry into new
product categories. We intend to develop our mishmash concept with distinct
images so it can be expanded in the same manner.

   Proprietary design and merchandising capabilities. As a
vertically-integrated specialty retailer, we develop substantially all of our
merchandise assortment through our design group, which allows us to create a
vast array of exclusive merchandise under our proprietary brands and enables us
to respond quickly to changing fashion trends. Additionally, because our
merchandise is sold exclusively in our stores, we are able to control the
presentation and pricing of our merchandise and provide a high level of
customer service. Our merchandising strategy of offering broad assortments
allows us to constantly introduce new and fresh elements of the latest fashion
trends. We believe that these capabilities provide us with a competitive
advantage over other brand manufacturers that market their goods through
department and other specialty apparel stores.

   Store design and creation. A major element of our success is the consistent
store-level execution of our brand strategy. We tightly control our in-store
presentation through detailed and comprehensive store plans. These plans use
visual displays and fixtures designed to brand our stores in a manner tailored
to appeal to our target customer group. We design our Limited Too stores to
provide a "theme park" destination in the mall and to encourage our customers
to touch and sample our products. All of our Limited Too stores contain a wide
variety of merchandise for a "one-stop shopping" experience, which has been
specifically designed to embody a "store for her" theme. Our stores feature
colorful window displays, photographic sticker booths, gumball machines and
eye-catching photographs and marketing. Additionally, all Limited Too stores
opened or remodeled since mid-1997 have our Girl Power format, which includes
photographs of our target customer on the front-of-the-store signage and
creates a cool, girl-friendly environment. It provides a flexible store format
to frequently change our merchandise presentations. We are applying a similar
philosophy and execution discipline in connection with our development of
mishmash.

   Integrated sales channels. We offer our products through three integrated
sales channels for Limited Too: our stores, catazines, which incorporate
editorial content with product in our catalog, and website. We believe that
our three sales channels, which we refer to as our 360-

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degree brand, allow us to leverage our experience in customer service and
increase the visibility of our brand. Our catazines and website give our
customers additional opportunities to preview our products and current fashion
trends. Though customers have the opportunity to buy directly through all three
channels, we believe the direct channels serve primarily to build our brand's
exposure and to drive store traffic.

   Proven management team. Our management team has increased the level of brand
awareness and consistently delivered improved financial results over the past
five years. We believe that our management has a distinct understanding of our
customers and is able to execute design, sourcing and marketing strategies to
profitably penetrate our target customer groups. Our executive officers have
extensive experience in the retail industry and have demonstrated a track record
of highly profitable growth, which positions us well for the future.

Our Growth Strategy

   Our growth strategy focuses on four goals: (i) expanding the Limited Too
store base with continued store openings and remodelings, (ii) expanding our
mishmash concept, (iii) driving sales growth through direct mail and other
marketing initiatives and (iv) executing merchandise and sourcing strategies to
satisfy our target customers' needs while improving our gross income rate.

   Limited Too stores. As of February 2, 2002, we operated 459 Limited Too
stores. Given the strength of our brand and our customer demographics, our
management team believes that there are approximately 200 to 250 sites available
for new stores, including regional malls, outlet centers, specialty centers and
major urban locations. We intend to continue our store expansion program by
opening approximately 50 to 55 new stores per year and remodeling approximately
10 stores per year. In the long term, we expect Limited Too to become a 650- to
700-store chain.

   mishmash stores. In addition to our expansion of Limited Too stores, we are
developing and expanding our new mishmash store concept. We currently have nine
mishmash stores throughout the United States, offering personal care, shoes,
intimate apparel, accessories and lifestyle products for teen girls ages 14 to
19. mishmash stores currently average approximately 2,300 square feet, and we
anticipate future stores will average in excess of 3,000 square feet as we
expand the sportswear portion of our merchandise assortment. During 2002, we
intend to continue to refine our merchandise assortment and build the
infrastructure to support our mishmash roll-out. We expect that these steps
will enable us to open 30 to 50 mishmash stores in fiscal 2003.

   Direct mail and other marketing initiatives. We are committed to enhancing
our brand recognition and plan to continue the expansion of our catazine and
direct mail operations. The Limited Too catazine is our primary direct mail
vehicle, and we plan on increasing the number of catazine editions to eight in
fiscal 2002, from seven in 2001 and five in 2000. We expect our total fiscal
2002 circulation to exceed 34 million catazines, representing an increase of
approximately 55% from fiscal 2001. Our ongoing analysis of the catazine's
impact on sales demonstrates that it drives additional sales into our stores. We
have created, and have plans for, other direct mail initiatives, including
expansion of our personalized birthday program, creating eight million
additional points of contact in fiscal 2002.

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   We intend to complement our direct mail initiatives with a variety of
marketing strategies. We have multiple marketing relationships that promote our
brand and have recently expanded our marketing efforts to focus on national
television advertising, including cross-promotions with major media companies
such as Disney and Universal Studios and consumer product companies. In the
future, we also intend to continue many of our current initiatives, such as our
frequent buyer and Too Bucks programs. We believe our direct mail and marketing
initiatives will increase brand loyalty and encourage repeat customer visits to
our stores.

   Merchandise and sourcing strategies. We believe that our ability to design,
source and market merchandise quickly and effectively has been a key element of
our success. We plan to develop new ways to expand existing merchandise
categories and to introduce new product offerings. As part of our plan to
continue to improve our gross income rate, we intend to open our first direct
sourcing office, in Hong Kong, by the summer of fiscal 2002. This will allow us
to substantially reduce the involvement of agents, brokers and middlemen as we
establish increased direct relationships with factories. We expect to realize
meaningful cost savings beginning in fiscal 2003 as a result of this long-term
initiative.

Our Industry

   Our 'tween market. As the leading specialty retailer that focuses on 7 to 14
year-old 'tween girls, we believe we are benefiting from several positive
demographics. Our Limited Too stores target a stable 'tween population that is
composed of nearly 16 million girls. According to NPD, the 7 to 14 year-old
girls apparel market, including discount, specialty, chain and department
stores, was $9.9 billion in 2000. Additionally, the specialty channel, which
represented 20.4% of this overall market in 1998, increased to 26.6% of the
market in 2000, while chain and department stores declined as a percentage of
the market.

                     7 to 14 Year Old 'Tween Girl Apparel
                            Market Share by Segment

<TABLE>
<CAPTION>
                                       1998   1999   2000
                                       -----  -----  -----
                     <S>               <C>    <C>    <C>
                     Specialty........  20.4%  23.5%  26.6%
                     Department/Chain.  35.7   33.1   30.0
                     Discount.........  30.2   29.1   28.8
                     Other............  13.7   14.3   14.6
                                       -----  -----  -----
                            Total..... 100.0% 100.0% 100.0%
</TABLE>
--------
Source: NPD Group.

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   Our teen market. Our new mishmash retail concept targets a slightly older
(14 to 19 years old) female customer which enables us to extend our target
demographics and utilize our existing database of six million 'tween girls as
Limited Too customers get older. According to the U.S. Census Bureau, the
teenage population in the United States, which is defined as persons 12 to 19
years old, will grow approximately 37% faster than the overall population, from
approximately 32 million in 2000 to approximately 34 million in 2005. According
to Teenage Research Unlimited, an independent research firm, total spending by
teenagers (boys and girls) has grown to $172 billion in 2001 from $141 billion
in 1998, reflecting a compound annual growth rate of 6.8%, more than double the
rate of inflation during this period. Of that spending, an estimated 46% was
spent on apparel and personal care products. With our mishmash expansion, we
will be able to extend our target demographic.

Our Stores

   As of February 2, 2002, we operated 459 Limited Too and seven mishmash
stores in 46 states. Our stores are primarily located in traditional malls.
Included are 14 stores located in specialty centers, which generally contain
traditional mall-type stores in an outdoor setting, and 11 stores located in
outlet centers. Regardless of setting, all of our stores maintain consistent
marketing, merchandise and layout characteristics. The following table shows
the number of Limited Too stores operated by us over the past five fiscal years.

<TABLE>
<CAPTION>
                                                                 Fiscal Year Ended
                                            ----------------------------------------------------------
                                            February 2, February 3, January 29, January 30, January 31,
                                             2002 (1)      2001        2000        1999        1998
                                            ----------- ----------- ----------- ----------- -----------
<S>                                         <C>         <C>         <C>         <C>         <C>
Number of stores:
Beginning of year..........................      406         352         319         312         308
Opened.....................................       57          58          42          10           7
Closed.....................................       (4)         (4)         (9)         (3)         (3)
                                            ----------- ----------- ----------- ----------- -----------
                                                 459         406         352         319         312
                                            ----------- ----------- ----------- ----------- -----------
Stores remodeled...........................        6          10          18          15           -
Stores in Girl Power format................      216         156          89          29           4
% in Girl Power format.....................       47%         38%         25%          9%          1%
Total square feet at period end (thousands)    1,881       1,669       1,441       1,281       1,244
Average store size at period end (square
  feet)....................................    4,098       4,111       4,094       4,015       3,987
Annual sales per average square foot (2)...   $  336      $  341      $  329      $  299      $  258
</TABLE>
--------
(1) Amounts exclude mishmash stores.
(2) Annual sales per average square foot is the result of dividing net sales
     for the fiscal year by average gross square feet, which reflects the
     impact of opening and closing stores throughout the year.

   Limited Too stores. Our Limited Too stores and point-of-sale marketing are
designed to convey the principal elements and personality of our Limited Too
brand - creativity, fashion awareness and excitement for increasingly
independent girls. We plan and coordinate our store design, furniture, fixtures
and music to create a shopping experience that is consistent with the
fashionable and energetic lifestyle of our target customer group. Our design
embodies a "store for her" concept, featuring an abundance of light, lower and
accessible fixtures, bright colors and popular music appropriate for our 'tween
customers. We believe that our customers consider our stores to be entertaining
and a multi-sensory overload, in which they feel welcomed and "cool."

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   We vary slightly the inventory mix of our stores depending on the regional
climate, fashion taste or traffic volume of a particular mall. This enables us
to be cost-effective in recognizing each store's ability to support additional
inventory while maintaining a uniformly positive shopping experience for our
customers. We maintain a uniform appearance throughout our store base in terms
of marketing and merchandise display and location on the selling floor. Store
managers receive detailed store plans that dictate fixture and merchandise
placement to ensure uniform execution of our merchandising strategy at the
store level and the portrayal of our brand in a manner designed to appeal to
our target customer group. Standardization of store design and merchandise
presentation also creates cost savings in store furnishings and marketing,
maximizes usage and productivity of selling space and allows us to open new
stores efficiently.

   Each year, we have four major floor sets with matching window displays to
correspond with our spring, summer, back-to-school and Christmas holiday
shopping periods. Every two to three weeks, our management coordinates and
directs our stores to modify these floor sets and usually the coordinated
window displays, highlighting different merchandise and moving displays to
different areas within the store. These frequent changes enable us to profile
new merchandise while fostering our brand image as featuring the "hottest"
fashions.

   Our sales associates are a central element in creating our stores'
distinctive atmosphere. In addition to providing a high level of friendly
customer service, our sales associates reinforce the fashion-awareness of our
brand and cater to the energetic lifestyle of today's girls.

   Our 2001 store openings are trending to achieve an annualized first-year
after tax cash return on investment, or ROI, of approximately 65%, representing
our fourth consecutive year of improved return on new store openings. We
estimate that the average cost for leasehold improvements, furniture and
fixtures for stores to be opened in fiscal 2002 will be between $175,000 and
$190,000 per store, after giving effect to landlord allowances. Average
pre-opening costs per store, which will be expensed as incurred, are expected
to be approximately $10,000, while inventory purchases are expected to average
approximately $75,000 per store. Due to lower occupancy costs, our outlet
locations produced a substantially higher first year after-tax ROI than that of
our mall-based stores in fiscal 2001. Accordingly, we expect that outlet
locations will make up a higher proportion of our new store openings in the
future. Our costs for remodeling or expanding existing stores range from
$250,000 to $450,000 per store.

   mishmash stores. We currently have nine mishmash stores throughout the
United States, offering personal care, shoes, intimate apparel, accessories and
lifestyle products for teen girls ages 14 to 19. mishmash stores currently
average approximately 2,300 square feet, and we anticipate future stores will
average in excess of 3,000 square feet as we expand the sportswear portion of
our merchandise assortment. During 2002, we intend to continue to refine our
merchandise assortment and build the infrastructure to support our mishmash
roll-out. We expect these steps will enable us to open 30 to 50 mishmash stores
in 2003. Our mishmash concept allows us to leverage our existing database of
six million 'tween girls and continue to capture these customers as they get
older by providing a new, unique shopping destination that appeals to more
mature teen girls. The store design is "retro-cool" and is inspired by the
colors and sensations of Miami's South Beach. The design was recently awarded
first place by the well-respected Visual Merchandising and Store Design
magazine. We offer a breadth of products that enables the teen customer to
complement her fashionable appearance with accessories, intimate apparel,
cosmetics, sportswear and shoes, as well as other novelty items expressive of
her distinct

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personality and tastes. We have expanded our merchandising team and will
leverage our knowledge of teen girls to refine our merchandising strategy and
store concept for mishmash. We have not yet launched any advertising or
promotional initiatives for our mishmash stores. However, as with our Limited
Too concept, we intend to employ an integrated brand management strategy
including unique in-store designs, seasonal promotional programs, creative
signage and window displays and complementary direct mail and website
initiatives.

   Point-of-sale system. By the end of the back-to-school selling season in
July 2002, we expect to complete the installation of a new point-of-sale
system. This planned technology upgrade will enable us to provide a greater
level of customer service, enhance the communication link with our stores,
improve back-office operations and offer the opportunity to automate
promotional programs such as our Frequent Buyer program and gift certificates.

Our Direct to Consumer Channels

   Direct mail. We mailed our first catazine during the 1999 back-to-school
period. Catazines, which incorporate a magazine format and style with a product
catalog, promote our Limited Too brand's lifestyle image and offer our
customers the opportunity to shop by mail or in the store. Each edition is
mailed to coincide with either key shopping seasons: (spring break, summer,
back-to-school and the Christmas holiday) or changes in our floorset. Catazines
include a similar merchandise assortment as our retail stores and, along with
our website, offer expanded sizes in fitted bottoms for the slightly larger girl
that are not available in our stores. We have found that our customers often
identify items in the catazine that they want to purchase and then use the
catazine as a "shopping guide" when they visit our stores. Other direct mail
initiatives also include personalized birthday card mailings and themed coupons
for in-store purchases. We engage third parties to assist us with print
production and other creative services, circulation and fulfillment.

   Website. Our Limited Too website offers another point of purchase for our
customers. We offer online the same selected assortment of merchandise as in
our catazines, including larger sizes, as well as clearance items. Our website
is designed to be easy to navigate, with links to products sorted by category.
Customers can also place orders from our catazines online and apply for our
private label credit card. The site's colorful graphics and photographs of
girls engaging in popular lifestyle activities capture the energy and
excitement of our Limited Too stores.

Our Merchandising Philosophy

   Product mix. We design and sell all of our apparel under our proprietary
Limited Too and mishmash brands. In addition, we source and purchase
merchandise from over 350 suppliers.

   Our Limited Too store merchandise assortment covers a broad array of
classifications in girls apparel, including jeans and other jeanswear, bottoms,
knit tops, T-shirts, shorts, skirts, dresses and outerwear. For many of these
products, we have both fashion basic and fashion-forward

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versions. Because our customer grows out of her top and bottom clothing items
at roughly the same time and in order to make our customers feel more secure in
their fashion choices, we display our merchandise as complete outfits, instead
of displaying garments together by product. Our outfits are displayed with
complementary matching accessories and other related items, which we believe
helps promote higher sales volume through multiple unit sales. In addition to
apparel, we offer accessory products such as key chains, wallets, backpacks,
purses and watches, as well as lifestyle products. Our lifestyle products
include products for her room such as inflatable furniture, candles, lamps and
posters, as well as small toys, candy, stickers and stationery.

   Our GirlCare line includes toiletries, such as shower gel and body splash,
accessories, such as hairbrushes and manicure sets, and cosmetics, such as
glitter nail polish and lip gloss. These GirlCare products are generally
arranged in our stores so that our customers can experiment with our products
and consult their friends and our sales associates. A substantial portion of
our GirlCare line is under $10 so that our target customer can spend her own
money. In addition, our Limited Too stores' assortment includes approximately
3% of third-party branded merchandise, predominantly in the footwear and
accessories categories.

   Our mishmash stores offer lifestyle and accessory products including
cosmetics, intimate wear, shoes, candy, hair accessories, watches and picture
frames, as well as a limited apparel selection, including graphic tees,
underwear and sleepwear. While most of the merchandise is sold under the
mishmash label, our cosmetics and shoe categories include third-party brands.

   We believe that there are significant opportunities to increase volume
through both increased penetration of existing merchandise classifications and
addition of new classifications. Management believes that our ability to design
and market new merchandise quickly and effectively has been a key element of our
success. In recent years, we have broadened our Limited Too product assortment
in existing categories to increase volume and productivity. We will continue to
expand key categories.

   Distribution and sourcing. Our vertically-integrated operations allow us to
control the process from the design stage through delivery to our stores. This
control allows us to respond quickly to changing trends and customer
preferences and insures that our merchandise is unique.

   In the first quarter of 2002, we transitioned our distribution operations to
a new distribution center in Etna, Ohio. Our new distribution center,
approximately 470,000 square feet, is the processing center for merchandise
that is shipped to our stores. The new facility is specifically designed to
support our retail operations, and has sufficient capacity to service 800
stores and can be expanded to support another 200 stores. Additionally, we own
adjacent land for further expansion. Owning and operating our own distribution
center will improve control of our distribution needs, and better facilitate
our long-term supply and logistics needs.

   We use a variety of vendors to produce our merchandise. In fiscal 2001, we
purchased merchandise from approximately 350 suppliers. Historically, our
largest apparel supplier has been Mast Industries, Inc., a wholly-owned
subsidiary of The Limited. Mast Industries supplied approximately 30% of the
merchandise that we purchased in fiscal 2001. We intend to open our first
direct sourcing office, in Hong Kong, by the end of fiscal 2002. This will
allow us to substantially reduce the involvement of agents, brokers and
middlemen as we establish increased direct relationships with factories. We
expect to realize meaningful cost savings as a result of this long-term
initiative.

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Additionally, we believe that we have strong and loyal relationships with our
vendors, which provides us short lead times and greater flexibility for
inventory replenishment. Our catazine and website orders are fulfilled through
an outsourced distribution and fulfillment center in Texas.

   Inventory management. Our approach to inventory management emphasizes rapid
turnover, historically averaging in excess of eight times per year, which we
believe is faster than most of our competitors. In addition, we take markdowns
where required to keep merchandise fresh and current with fashion trends. Our
policy is to maintain sufficient quantities of inventory on hand in our retail
stores and distribution center so that we can offer customers a full selection
of current merchandise.

   In November, we began testing a new point-of-sale system. This planned
technology upgrade will enable us to provide a greater level of customer
service, enhance the communication link with our stores, and improve
back-office operations. All stores are expected to have the new system
installed before the back-to-school selling season commencing in July 2002.

   We view the retail apparel market as having two principal selling seasons,
spring and fall. As is generally the case in the apparel industry, we
experience our peak sales activity during the fall season. This seasonal sales
pattern results in increased inventory during the back-to-school and Christmas
holiday shopping periods. During fiscal 2001, our highest inventory level
approximated $61 million at the end of November 2001 and the lowest inventory
level approximated $32 million at the end of May 2001.

Marketing and Promotion

   Our marketing and promotional strategies are consistent with our focused and
differentiated brands. In the future, we intend to continue many of our current
in-store advertising and promotional initiatives that appeal to the fun loving
nature of our Limited Too stores' target customer group. Historically, we have
employed several marketing initiatives that we intend to continue. These
include:

   Cross-Promotions. We have multiple marketing relationships that promote our
brand and have engaged in cross-promotions with major media companies such as
Disney and Universal Studios and consumer product companies. We recently
completed a "15th Birthday Bash Sweepstakes" contest offering a Universal
Studios trip for the winner and her friends. In 2001, our "Passion for Fashion
Tour" included events such as fashion shows, contests and musical performances
by popular music stars.

   Colorful window displays. We place large bright, cheerful graphics or
photographs in at least one of our display windows. We change our displays
frequently and often pursue seasonal themes. We believe our window displays
attract customer attention in a busy mall environment and immediately allow
shoppers to recognize our store as a place for young girls. Our in-store
displays include a series of distinctive color photographs that are enlarged
and prominently displayed throughout the stores. These photographs contain
images of young girls engaged in popular lifestyle activities, which we believe
reinforce the peer-acceptance quality of our brand.

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   Frequent Buyer program. Our ongoing frequent buyer program uses a
wallet-sized punch card (the Frequent Buyer Card) that can be punched up to ten
times for every $20 increment spent in our stores. On the first and third
Tuesday of every month, through our "Too Punch Toosday" program, customers
receive double punches on their Frequent Buyer Card for each qualifying
purchase. After 10 punches, a customer can redeem the card for a $20 discount.
Approximately 1.8 million fully-punched Frequent Buyer Cards were redeemed in
fiscal 2001. In that same period, approximately 70% of all eligible transactions
(transactions over $20) used a Frequent Buyer Card in the purchase, and a
Frequent Buyer Card was redeemed in over 12% of all transactions. In order to
receive a Frequent Buyer Card, our customers are asked to provide their name,
address, birthday and their sister's name. This program is the primary source
for our customer information database.

   Too Bucks program. Our event-oriented bounceback program occurs three times
a year: spring (around Easter), the fall back-to-school period and the
Christmas holiday shopping season. The program provides customers who purchase
$50 or more in any of our sales channels with $25 off coupons which can be used
toward purchases over $50 made during the two or three weeks after
distribution. Aggregating the three campaigns, the coupons are distributed for
approximately 18 weeks and redeemable for nine weeks; therefore, the campaign
is a part of our promotion strategy for 27 weeks of the year. For fiscal 2001,
nearly 50% of the coupons were redeemed.

   Credit card program. We began our private label credit card program in
September 2000. We estimate that our Limited Too credit card customers spend
nearly twice as much per trip as our average customer. In fiscal 2001, our first
full year of the card, 300,000 new Limited Too credit cards were issued and
Limited Too credit card purchases represent an increasing proportion of our
sales.

   Other promotions. Customers who successfully pass all classes at the end of
the grading period can bring in their report cards to redeem a $5 coupon that
can be used in the stores. We also send birthday cards to customers in our
database, which include a coupon that can be redeemed in our stores. In
addition, through our catazine mailings, we send out coupons with various
themes that can be used in our stores.

Our Relationship with The Limited

   In August 1999, The Limited distributed to its shareholders in a spin-off
all of its interest in us on the basis of one share of our common stock for
each seven shares of The Limited's common stock. As a result of the spin-off,
we became an independent, separately traded, public company. In connection with
the spin-off, we entered into several agreements with The Limited which
continue to cover certain aspects of our ongoing relationship with The Limited,
including our license of the "Limited Too" brand name and arrangements with The
Limited under certain store leases.

Trademarks and Service Marks

   We own trademarks and service marks, including mishmash, used to identify
our merchandise and services, other than our brand name, Limited Too. Many of
these marks are registered with the U.S. Patent and Trademark Office. These
marks are important to us, and we intend to, directly or indirectly, maintain
and protect these marks and their registrations. However, we may choose not to
renew a registration of one or more of our merchandise marks if we determine
that the mark is no longer important to our business.

                                       12

<PAGE>

   We also conduct business in foreign countries, principally because a
substantial portion of our merchandise is manufactured outside the United
States. We have registered marks in foreign countries to the degree necessary
to protect these marks, although there may be restrictions on the use of these
marks in a limited number of foreign jurisdictions.

   A wholly-owned subsidiary of The Limited owns the brand name "Limited Too,"
which is registered in the United States and in numerous foreign countries.
This subsidiary licenses the brand name to one of our wholly-owned
subsidiaries. In connection with the spin-off, these subsidiaries entered into
a trademark and service mark licensing agreement that allows us to operate
under the "Limited Too" brand name in connection with our 'tween business. The
agreement is for an initial term of five years after the spin-off, renewable
annually thereafter at our option.

Competition

   The sale of apparel and personal care products through retail stores and
direct-to-consumer channels is a highly competitive business with numerous
competitors, including individual and chain fashion specialty stores,
department stores, discount retailers and direct marketers. Depth of selection,
colors and styles of merchandise, merchandise procurement and pricing, ability
to anticipate fashion trends and customer preferences, inventory control,
reputation, quality of merchandise, store design and location, advertising and
customer services are all important factors in competing successfully in the
retail industry. We believe that our focused and differentiated brand provides
us an ability to compete successfully in our industry.

Associate Relations

   As of February 2, 2002, we employed approximately 8,400 associates, none of
whom were parties to a collective bargaining agreement, approximately 6,400 of
whom were part-time. In addition, temporary associates are hired during peak
periods, such as the back-to-school and Christmas holiday shopping seasons.

                                       13

<PAGE>

Safe Harbor Statement and Business Risks

   The Company cautions that any forward-looking statements (as such term is
defined in the Private Securities Litigation Reform Act of 1995) included or
incorporated by reference in this Form 10-K involve risks and uncertainties and
are subject to change based on various important factors, many of which may be
beyond our control. Forward-looking statements are indicated by words such as
"anticipate," "estimate," "expect," "intend," "plan," "risk," "could," "may,"
"will," "pro forma," "likely," "possible," "potential" and similar words and
phrases and the negative forms and variations of these words and phrases, and
include statements relating to anticipated capital expenditures for opening new
stores, including both Limited Too and mishmash, the remodeling or expansion of
existing stores, the completion of a new distribution center and home office,
and the related funding. Future economic and industry trends that could
potentially impact revenue and profitability are difficult to predict.
Therefore, there can be no assurance that the forward-looking statements
included or incorporated by reference in this Form 10-K will prove to be
accurate. In light of the significant uncertainties in the forward-looking
statements included or incorporated by reference in this Form 10-K, the
inclusion of such information should not be regarded as a representation that
our objectives will be achieved. The forward-looking statements included or
incorporated by reference in this Form 10-K are based on information presently
available to our management. We assume no obligation to publicly update or
revise the forward-looking statements after the date of this Form 10-K even if
experience or future changes make it clear that any projected results expressed
or implied herein will not be realized. The following factors, among others, in
some cases have affected, and in the future could affect, our financial
performance and actual results and could cause future performance and financial
results to differ materially from those expressed or implied in any
forward-looking statements included or incorporated by reference in this
Form 10-K:

                                       14


<PAGE>

We may not be able to achieve comparable store sales growth.

   Our comparable store sales performance has declined in the past,
particularly during the recent recession. Our comparable store sales growth
decreased from 9% for fiscal 1999 to 4% for fiscal 2000 and 0% for fiscal 2001.
For the fourth quarter of fiscal 2001, our comparable store sales declined 2%.
Our comparable store sales will continue to fluctuate and may be affected by
many factors, including:

    .  economic conditions;

    .  weather conditions;

    .  our ability to keep up with fashion trends;

    .  competition;

    .  new store openings in existing markets;

    .  store remodelings and expansions;

    .  customer response to new and existing styles; and

    .  procurement and management of merchandise inventory.

   As a result of these and other factors, we may not achieve or be able to
maintain comparable store sales growth in the future. Our stock price may be
materially adversely affected by declines and fluctuations in our comparable
store sales.

We must identify and respond to fashion trends and satisfy customer demands in
order to continue to succeed.

   Our success depends in part on our management's ability to anticipate the
fashion tastes of our customers and offer merchandise which appeals to them on a
timely and affordable basis. We expect our customers' fashion tastes to change
frequently. If we are unable to successfully anticipate, identify or react to
changing styles or trends, our sales may be adversely affected and we may have
excess inventories. In response, we may be forced to increase our marketing
promotions or take markdowns, which could have a material adverse effect on our
business. Our brand image may also suffer if our customers believe that our
merchandise misjudgments indicate that we are no longer able to offer them the
latest fashions.

We may be unable to compete successfully in our highly competitive segment of
the retail industry.

   The girls retail apparel and accessories industry is highly competitive. We
expect competition in this market to increase because there are few barriers to
entry and our success may attract additional competitors. In addition, the
population of our primary target market, 'tween girls, is expected to remain
relatively flat over the near term. Increased competition could result in
pricing pressures, increased marketing expenditures and loss of our market
share, all of which could have a material adverse effect on our financial
condition and results of operations.

                                       15




<PAGE>

   We compete for sales primarily with specialty apparel and accessory
retailers, such as GapKids and Claire's, department stores, such as Nordstrom,
and discount retailers, such as Target. Other specialty retailers, including
Wet Seal and Abercrombie & Fitch, have entered the market for pre-teen apparel.
In addition to the traditional store-based retailers, we also compete with
direct marketers who target customers through catalogs and Internet shopping.
Direct marketers also include traditional store-based retailers like us who are
expanding or have expanded into catalogs and the Internet as additional
distribution channels.

   Some of our competitors may have greater financial, marketing and other
resources available to them. In many cases, our primary competitors are located
in the same shopping centers as our stores, and in addition to competing for
sales, we compete for favorable site locations and lease terms.

We depend on a high volume of mall traffic to generate sales.

   Substantially all of our stores are located in shopping malls. Our sales are
derived, in part, from the high volume of traffic in those malls. We benefit
from the ability of the mall's anchor tenants, generally large department
stores, and other area attractions to generate consumer traffic in our stores'
vicinity and on the continuing popularity of malls as shopping destinations.
Sales volume and mall traffic may be adversely affected by economic downturns
in a particular area, competition from non-mall retailers and other malls where
we do not have stores, and the closing of anchor tenants. In addition, a
decline in the desirability of the shopping environment in a particular mall or
a decline in the popularity of mall shopping among our target consumers could
have a material adverse effect on our business.

We depend on the availability of suitable lease space to sustain our growth.

   Our future growth significantly depends on our ability to open new stores in
desirable locations. We estimate that approximately 200 to 250 sites meet our
selection criteria and will be available for new Limited Too stores over the
next several years. If we open approximately 50 to 55 Limited Too stores per
year, our selection of desirable locations may become limited. We cannot assure
you as to when or whether additional desirable locations will become available.

   In addition, as of February 2, 2002 we shared lease space in 107 locations
with The Limited. If any of these leases is terminated or defaulted upon by The
Limited, we might be forced to move to a different and potentially less
desirable store location with less traffic in the same mall, or in a different
mall, or to close the store. This may adversely impact sales at that location
and could have a material adverse effect on our financial condition and results
of operations.

Our licensed Limited Too and registered mishmash brands are integral to our
brand strategy, competitive position and sales.

   We currently license the Limited Too brand name and have a federal
registration for the mishmash trademark and other trademarks in the United
States and have applied for or obtained a registration for mishmash in most of
the foreign countries in which our vendors are located.

   We cannot assure you that the registrations we have obtained will be
adequate to prevent the imitation of our products or infringement of our
intellectual property rights by others. If a third party imitates our products,
consumers may be confused and that third party may gain sales

                                       16



<PAGE>

at our expense, and if any such products are manufactured or marketed in a
manner that projects lesser quality or carries a negative connotation, our
brand image could be adversely affected.

   In addition, our right to operate under the Limited Too brand is governed by
an exclusive trademark and service mark licensing agreement with The Limited.
The agreement is for an initial term of five years, ending in August 2004, and
is renewable annually thereafter at our option. In return, we are required to
provide The Limited with the right to inspect our stores and distribution
facilities and the ability to review our advertising. The Limited has the right
to terminate the agreement under certain circumstances, specifically if:

    .  we breach any of our obligations under the agreement and do not cure the
       breach within 60 days after receiving notice of the breach;

    .  we become bankrupt or insolvent; or

    .  we experience a change of control.

   The agreement also restricts the way in which we use the licensed brand in
our business. We may only use the brand name Limited Too in connection with any
business in which we sell to our current Limited Too target customer group or
to infants and toddlers.

   If in the future we are unable to use the Limited Too brand, we will be
forced to change our brand name. Because much of our merchandise is currently
sold under the Limited Too label in stores called "Limited Too," a name change
might cause confusion for our customers and adversely affect our brand
recognition and our sales. We would need to expend substantial resources, which
we cannot estimate at this time, to rename our stores, to produce new
merchandise and to establish brand recognition if we were required to change
our brand.

We rely on key personnel.

   Our continued success depends, to a significant degree, upon the services of
our key personnel, particularly our senior executive officers. The loss of any
member of senior management could have a material adverse effect on our
business, financial condition and results of operations. Our success in the
future will also depend upon our ability to attract and retain qualified
personnel.

Increases in costs of mailing, paper or printing may impact our business.

   Postal rate increases and paper and printing costs affect the cost of our
catazine and direct mail promotions. The U.S. Postal Service has announced an
increase in its rates, effective June 30, 2002, and this increase will have an
impact on our costs. In addition, although we do not generally use the U.S.
Postal Service for fulfillment of orders made from our catazines and our
website or for delivery of merchandise from our vendors to us or from our
distribution center to our stores, postal rate increases may have an indirect
impact on these operations due to potential competitive increases by other
delivery services. Furthermore, these delivery services periodically raise
their rates independent of the U.S. Postal Service, and the U.S. Postal Service
may raise its rates further in the future.

   We are not party to any long-term contracts for the supply of paper or
printing services. Future paper, printing and postal rate increases would
adversely impact our earnings if we were

                                       17



<PAGE>

unable to pass such increases directly on to our customers or offset such
increases by raising prices or by implementing more efficient printing,
mailing, delivery and order fulfillment systems.

We may not be able to sustain a growth rate sufficient to implement our
expansion strategy.

   We have grown rapidly over the past few years. We may not be able to
continue to grow profitably or at rates consistent with our recent past. Our
future growth prospects depend upon a number of factors, including our ability
to:

    .  find suitable markets and sites for our stores and negotiate leases on
       acceptable terms for those stores;

    .  fulfill our plans to open new stores and remodel or expand existing
       stores;

    .  continue to develop our sales channels, including our catazines and
       website operations;

    .  attract and retain talented personnel and expand our infrastructure to
       accommodate our growth, including maintaining high levels of customer
       service by hiring and training qualified sales associates;

    .  manage our inventory effectively, maintain sufficient distribution
       capacity and deliver our merchandise in a timely manner;

    .  keep up with constantly shifting fashion trends and develop new and
       appealing merchandise; and

    .  successfully introduce and build upon the mishmash store brand.

   We will require substantial capital expenditures to implement our business
strategy, in particular our opening of new stores and remodeling or expansion
of our existing stores, which we estimate will require capital expenditures of
approximately $17 million to $20 million in fiscal 2002. If we do not generate
sufficient cash flow from operations or if we are unable to obtain sufficient
financing under our credit facility or from other sources on acceptable terms,
we may be required to reduce our planned capital expenditures, which could have
a material adverse effect on our growth prospects.

We may not be able to grow mishmash profitably.

   In fiscal 2001, we opened seven mishmash stores, which target girls between
the ages of 14 and 19, a slightly older customer than our Limited Too customer.
We expect to continue to devote significant management and other resources to
mishmash, including for development of the concept and the planned opening of
four new mishmash stores in fiscal 2002 and, if the mishmash concept is
successful, 30 to 50 new mishmash stores in fiscal 2003. We have a short
operating history with mishmash and with the teen girl customer segment. The
teen girl apparel market has historically been more competitive than the 'tween
girl apparel market. Some of these competitors are larger and more established
than we are and may have greater financial and other resources available to
compete with us. Due to these factors, we cannot assure you that we will be
successful in this market or that our mishmash stores will prove profitable over
the short or long term. In addition, as we expand our mishmash concept, it may
divert management's attention from our core Limited Too business and may require
substantial capital expenditures.

                                       18



<PAGE>

Our net sales, net income and inventory levels fluctuate on a seasonal basis.

   We experience seasonal fluctuations in our net sales and net income, with a
disproportionate amount of our net sales and a majority of our net income
typically realized during our fourth quarter due to sales from the Christmas
holiday shopping period. We also generate significant net sales during the
back-to-school period in the third quarter. Any decrease in sales or margins
during those periods could have a material adverse effect on our financial
condition and results of operations.

   Seasonal fluctuations also affect our inventory levels because we typically
order merchandise in advance of the peak selling periods and often before new
fashion trends are confirmed by customer purchases. We must carry a significant
amount of inventory, especially before the Christmas holiday and back-to-school
selling periods. Forecasting errors may result in excess inventory, which may
lead to markdowns and inventory valuation adjustments.

Our business is sensitive to economic conditions and consumer spending patterns.

   Our business is sensitive to changes in overall economic conditions and
consumer spending patterns. Our growth, sales and profitability may be
adversely affected by unfavorable local, regional, national or international
economic conditions, including the effects of war, terrorism or the threat
thereof. In addition, shifts in our customers' discretionary spending to other
goods, including music, entertainment and electronic products, could also
adversely affect our business.

We may experience potential disruptions in the receipt and distribution of our
merchandise associated with the relocation of our distribution center to our new
facility.

   On February 15, 2002, we opened our own, newly-constructed 470,000 square
foot distribution center in Etna, Ohio. Previously, we received distribution
services from The Limited. Our new distribution facility has been operating for
only a short period of time, and its reliability and capacity, particularly
during peak sales seasons, are unproven. It is possible that complications with
our new warehouse management systems could result in a significant interruption
in the receipt and distribution of our merchandise and an increase in our
distribution costs. Any such disruption could have a material adverse effect on
our business.

   Our merchandise is shipped directly from manufacturers through freight
consolidators to our distribution facility in Etna, Ohio. Our operating results
depend in large part on the orderly operation of our receiving and distribution
process, which depends on manufacturers' adherence to shipping schedules and
our effective management of our new distribution facility. In addition, we
cannot assure you that we have anticipated, or will be able to anticipate, all
of the changing demands which our expanding operations will impose on our
receiving and distribution system. Furthermore, it is possible that events
beyond our control, such as a strike or other disruption affecting the parcel
service that delivers substantially all of our merchandise to our stores, could
result in delays in delivery of merchandise to our stores. Any such event could
have a material adverse effect on our business.

We rely on foreign sources of production.

   In fiscal 2001, we sourced approximately 70% of our merchandise from foreign
factories located primarily in East and Southeast Asia. We do not have any
long-term merchandise supply contracts and many of our imports are subject to
existing or potential duties, tariffs or quotas that may limit the quantity of
goods which may be imported into the United States from countries in that
region. We compete with many other companies for production facilities and
import quota capacity.

                                       19

<PAGE>

   Our business also faces a variety of other risks generally associated with
doing business in foreign markets and importing merchandise from abroad,
including:

    .  political instability;

    .  currency and exchange risks;

    .  local business practice and political issues, including issues relating
       to compliance with domestic or international labor standards; and

    .  potential delays or disruptions in shipping and related pricing impacts.

   Our future performance will depend upon these factors, which are beyond our
control. These factors may have a material adverse effect on our business.

We source a significant portion of our merchandise from a limited number of
vendors.

   Nearly 60% of our apparel was sourced from two vendors in fiscal 2001, with
each supplying nearly 30% of our apparel. One of these vendors is Mast
Industries, Inc., a wholly-owned subsidiary of The Limited. We expect to open
our first direct sourcing office, in Hong Kong, by the summer of fiscal 2002.
Any disruption in our relationship with these or other key vendors or suppliers
could have a material adverse effect on our business.

We will need to comply with existing and new regulations that govern us.

   Currently, much of our personal care and lifestyle merchandise is subject to
various regulations promulgated by the U.S. Food and Drug Administration, the
Federal Trade Commission and the U.S. Consumer Product Safety Commission.

   For example, we are required to meet federal flammability standards for
children's sleepwear. These standards require sleepwear to be flame-resistant,
and if the fabric ignites, the flame on the garment must self-extinguish.
Failure to meet the flammability standards presents a risk of serious burn
injuries to children. We require our suppliers to take measures including
testing to assure us that these standards are met; however, they may source
products from other suppliers, in particular foreign suppliers, who, despite
our best efforts, may not adhere to these standards. If standards are not met,
we may be held liable for any resulting damages and may be subject to fines and
other penalties. In addition, we may be forced to voluntarily recall the
merchandise in question and give full refunds to our customers if the
merchandise fails to comply.

   As we expand our merchandise assortment and increase the number of our
suppliers to accommodate our growth, it may become more difficult or costly to
comply with existing and new regulations.

                                       20

<PAGE>

Our stock price may fluctuate significantly.

   Our stock price has fluctuated significantly in the past and we do not know
how our common stock will trade in the future. The market price of our common
stock may fluctuate significantly due to a number of factors, some of which may
be beyond our control, including:

    .  fluctuations in our operating results;

    .  reduction in the number of securities analysts who cover our company and
       distribute research and investment recommendations about our company;

    .  changes in earnings estimated by securities analysts or our ability to
       meet those estimates;

    .  the operating and stock price performance of other comparable companies;

    .  overall stock market fluctuations;

    .  the retail environment; and

    .  economic conditions.

   In particular, the realization of any of the risks described in above could
have a material adverse impact on the market price of our common stock. In
addition, the stock market in general has experienced extreme volatility that
has often been unrelated or disproportionate to the operating performance of
particular companies. These broad market fluctuations may adversely affect the
trading price of our common stock, regardless of our actual operating
performance. Additionally, if our quarterly results of operations fluctuate
significantly as a result of the seasonality of the retail industry, the timing
and costs of new store openings and remodelings or expansions of existing
stores, the performance of new and existing stores, merchandise mix or fashion
trends, the market price of our common stock may be affected.

                                       21

<PAGE>

ITEM 2.  PROPERTIES

Our home office facilities are located in New Albany, Ohio, within 10 miles of
our previous headquarters in Columbus, Ohio. In February 2002 we transitioned
our distribution operations to our new distribution center in Etna, Ohio, within
15 miles of our new home office facilities. Our new distribution center is
approximately 470,000 square feet. We own both our new distribution center and
home office facilities.

As of February 2, 2002, we operated 459 Limited Too and 7 mishmash stores, which
are located primarily in shopping malls throughout the United States. Of these
stores, 359 were leased directly from third parties -- principally shopping mall
developers -- and 107 are governed by leases where the primary tenant is The
Limited or an affiliate of The Limited. Of the 359 stores directly leased, 51
are guaranteed by The Limited. The leases expire at various dates between 2002
and 2012. In fiscal 2001, total store rent was $43.7 million. Minimum rent
commitments under non-cancellable leases as of February 2, 2002 total $48.5
million, $48.3 million, $46.6 million, $41.6 million, and $34.6 million for
fiscal years 2002 through 2006, respectively, and $81.4 million thereafter.

Typically, when space is leased for a retail store in a shopping center, all
improvements, including interior walls, floors, ceilings, fixtures and
decorations, are supplied by the tenant. In certain cases, the landlord of the
property may provide a construction allowance to fund all or a portion of the
cost of improvements. The cost of improvements varies widely, depending on the
size and location of the store. Lease terms are typically 10 years and usually
include a fixed minimum rent plus a contingent rent based on the store's annual
sales in excess of a specified amount. Certain operating costs such as common
area maintenance, utilities, insurance and taxes are typically paid by tenants.

Leases with The Limited or an affiliate of The Limited are on terms that
represent the proportionate share of the base rent payable in accordance with
the underlying lease plus the portion of any contingent rent payable in
accordance with the underlying lease attributable to our performance.
Additionally, The Limited provides guarantees on certain leases and assesses a
fee based on stores' sales exceeding defined levels.

ITEM 3.  LEGAL PROCEEDINGS

         Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         None.

                                       22

<PAGE>

                                     PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER
         MATTERS

Too, Inc. shares are traded on the New York Stock Exchange under the trading
symbol "TOO". At April 15, 2002, the Company had approximately 22,232
shareholders of record. The Company has not paid any dividends on its common
stock and does not intend to pay any dividends in the foreseeable future.

Information concerning the market price of the Company's common stock for fiscal
2001 is set forth in Note 12 to the Consolidated Financial Statements on page 46
of the 2001 Annual Report and is incorporated herein by references.

ITEM 6.  SELECTED FINANCIAL DATA

Selected financial data is set forth under the caption "Selected Financial Data"
on page 25 of the 2001 Annual Report and is incorporated herein by reference.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

Management's discussion and analysis of financial condition and results of
operations is set forth under the caption "Management's Discussion and Analysis
of Financial Condition and Results of Operations" on pages 26 through 33 of the
2001 Annual Report and is incorporated herein by reference.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Management believes the Company's exposure to interest rate and market risk
associated with financial instruments (such as investment changes and
borrowings) is not material.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The Consolidated Financial Statements of the Company and Subsidiaries, the Notes
to Consolidated Financial Statements, the Report of Management and the Report of
Independent Accountants are set forth on pages 34 through 48 of the 2001 Annual
Report and are incorporated herein by reference.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURES

None.

                                       23

<PAGE>

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Information regarding directors and executive officers of the Company is set
forth under the captions "ELECTION OF DIRECTORS - Nominees and Directors", " -
Information Concerning the Board of Directors", "- Committees of the Board of
Directors", " - Executive Officers" and "- Security Ownership of Directors and
Management" on pages 3 through 6 of the Company's proxy statement for the Annual
Meeting of Stockholders to be held May 21, 2002 that was filed on April 15, 2002
(the "Proxy Statement") and is incorporated herein by reference. Information
regarding compliance with Section 16(a) of the Securities Exchange Act of 1934,
as amended is set forth under the caption "SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE" on page 19 of the Proxy Statement and is incorporated
herein by reference.

Our former director and member of the Audit Committee, James U. McNeal,
submitted his resignation from the Board of Directors to us on April 15, 2002.

ITEM 11.  EXECUTIVE COMPENSATION

Information regarding executive compensation is set forth under the caption
"EXECUTIVE COMPENSATION" on pages 7 through 12 of the Proxy Statement and is
incorporated herein by reference. Such incorporation by reference shall not be
deemed to specifically incorporate by reference the information referred to in
Item 402(a)(8) of Regulation S-K.

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

Information regarding the security ownership of certain beneficial owners and
management is set forth under the captions "ELECTION OF DIRECTORS - Security
Ownership of Directors and Management" on page 6 of the Proxy Statement and
"SHARE OWNERSHIP OF PRINCIPAL STOCKHOLDERS" on page 18 of the Proxy Statement
and is incorporated herein by reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Information regarding certain relationships and related transactions is set
forth under the captions "ELECTION OF DIRECTORS - Nominees and Directors" on
pages 3 and 4 of the Proxy Statement and is incorporated herein by reference.

                                       24

<PAGE>

                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)(1)   List of Financial Statements.
         ----------------------------

The following consolidated financial statements of Too, Inc. and Subsidiaries
and the related notes are filed as a part of this report pursuant to ITEM 8:

    .    Consolidated Statements of Income for the fiscal years ended
         February 2, 2002, February 3, 2001 and January 29, 2000.

    .    Consolidated Balance Sheets as of February 2, 2002 and
         February 3, 2001.

    .    Consolidated Statements of Changes in Shareholders' Equity for the
         fiscal years ended February 2, 2002, February 3, 2001 and
         January 29, 2000.

    .    Consolidated Statements of Cash Flows for the fiscal years ended
         February 2, 2002, February 3, 2001 and January 29, 2000.

    .    Notes to Consolidated Financial Statements.

    .    Report of Management.

    .    Report of Independent Accountants.


(a)(2)   List of Financial Statement Schedules.
         --------------------------------------

All schedules required to be filed as part of this report pursuant to ITEM 14(d)
are omitted because the required information is either presented in the
financial statements or notes thereto, or is not applicable, required or
material.

(a)(3)   List of Exhibits.
         -----------------

         2.1   Distribution Agreement dated as of August 23, 1999 between The
               Limited, Inc. and Too, Inc. (incorporated by reference to Exhibit
               2.1 to the Current Report on Form 8-K filed October 1, 1999).

         3.1   Amended and Restated Certificate of Incorporation of Too, Inc.
               (incorporated by reference to Exhibit 3.1 to the Current Report
               on Form 8-K filed October 1, 1999).

         3.2   Amended and Restated Bylaws of Too, Inc. (incorporated by
               reference to Exhibit 3.2 to the Current Report on Form 8-K filed
               October 1, 1999).

                                       25

<PAGE>

          4.1  Specimen Certificate of Common Stock of Too, Inc. (incorporated
               by reference to Exhibit 4.1 to the Current Report on Form 8-K
               filed October 1, 1999)

         10.1  Credit Agreement among Too, Inc., various lending institutions,
               Citicorp USA, Inc., as Syndication Agent and Morgan Guaranty
               Trust Company of New York, as Administrative Agent (incorporated
               by reference to Exhibit 10.1 to the Amended Registration
               Statement on Form 10 filed August 18, 1999)

         10.2  Store Leases Agreement dated as of August 23, 1999 by and among
               The Limited Stores, Inc., Victoria's Secret Stores, Inc., Lerner
               New York, Inc., Express, LLC, Structure, Inc., The Limited, Inc.
               and Too, Inc. (incorporated by reference to Exhibit 10.2 to the
               Current Report on Form 8-K filed October 1, 1999)

         10.3  Trademark and Service Mark Licensing Agreement dated as of August
               23, 1999 between Limco, Inc. and LimToo, Inc. (incorporated by
               reference to Exhibit 10.3 to the Current Report on Form 8-K filed
               October 1, 1999)

         10.4  Services Agreement dated as of August 23, 1999 by and between The
               Limited, Inc. and Too, Inc. (incorporated by reference to Exhibit
               10.4 to the Current Report on Form 8-K filed October 1, 1999)

         10.5  Tax Separation Agreement dated August 23, 1999 between The
               Limited, Inc., on behalf of itself and the members of The Limited
               Group, and Too, Inc., on behalf of itself and the members of the
               Too Group. (incorporated by reference to Exhibit 10.5 to the
               Current Report on Form 8-K filed October 1, 1999)

         10.6  Building Lease Agreement dated July 1, 1995 by and between
               Distribution Land Corp. and Limited Too, Inc., the predecessor
               company of Too, Inc. (incorporated by reference to Exhibit 10.6
               to the Amended Registration Statement on Form 10 filed August 18,
               1999)

         10.7  Amendment to Building Lease Agreement between Distribution Land
               Corp. and Too, Inc. (incorporated by reference to Exhibit 10.7 to
               the Current Report on Form 8-K filed October 1, 1999)

         10.8  Too, Inc. 1999 Incentive Compensation and Performance Plan.
               (incorporated by reference to Exhibit 10.8 to the Current Report
               on Form 8-K/A filed March 20, 2000)

         10.9  Too, Inc. Second Amended and Restated 1999 Stock Option and
               Performance Incentive Plan (incorporated by reference to Exhibit
               10.23 to the Quarterly Report on Form 10-Q filed on June 14,
               2001)

        10.10  Too, Inc. Third Amended and Restated 1999 Stock Option Plan for
               Non-Associate Directors

                                       26


<PAGE>

       10.11   Too, Inc. First Amended and Restated Savings and Retirement Plan.
               (incorporated by reference to Exhibit 10.1 to the Quarterly
               Report on Form 10-Q filed on September 11, 2000)

       10.12   Too, Inc. First Amended and Restated Supplemental Retirement and
               Deferred Compensation Plan. (incorporated by reference to Exhibit
               10.2 to the Quarterly Report on Form 10-Q filed on September 11,
               2000)

       10.13   Employment Agreement, dated as of September 15, 2000, between the
               Company and Michael W. Rayden (incorporated by reference to
               Exhibit 10.1 to the Quarterly Report on Form 10-Q filed on
               December 14, 2000)

       10.14   Executive Agreement, dated as of September 15, 2000, between the
               Company and Michael W. Rayden (incorporated by reference to
               Exhibit 10.2 to the Quarterly Report on Form 10-Q filed on
               December 14, 2000)

       10.15   Employment Agreement, dated as of September 15, 2000, between the
               Company and Kent A. Kleeberger (incorporated by reference to
               Exhibit 10.3 to the Quarterly Report on Form 10-Q filed on
               December 14, 2000)

       10.16   Executive Agreement, dated as of September 15, 2000, between the
               Company and Kent A. Kleeberger (incorporated by reference to
               Exhibit 10.4 to the Quarterly Report on Form 10-Q filed on
               December 14, 2000)

       10.17   Employment Agreement, dated as of September 15, 2000, between the
               Company and James C. Petty (incorporated by reference to Exhibit
               10.5 to the Quarterly Report on Form 10-Q filed on December 14,
               2000)

       10.18   Executive Agreement, dated as of September 15, 2000, between the
               Company and James C. Petty (incorporated by reference to Exhibit
               10.6 to the Quarterly Report on Form 10-Q filed on December 14,
               2000)

       10.19   Employment Agreement, dated as of October 30, 2000, between the
               Company and Ronald Sykes (incorporated by reference to Exhibit
               10.19 to the Annual Report on Form 10-K filed on May 2, 2001)

       10.20   Executive Agreement, dated as of October 30, 2000, between the
               Company and Ronald Sykes (incorporated by reference to Exhibit
               10.20 to the Annual Report on Form 10-K filed on May 2, 2001)

       10.21   Employment Agreement, dated as of September 15, 2000, between the
               Company and Sally A. Boyer (incorporated by reference to Exhibit
               10.7 to the Quarterly Report on Form 10-Q filed on December 14,
               2000)

       10.22   Executive Agreement, dated as of September 15, 2000, between the
               Company and Sally A. Boyer (incorporated by reference to Exhibit
               10.8 to the Quarterly Report on Form 10-Q filed on December 14,
               2000)

                                       27

<PAGE>

         10.23   Second Amendment to Credit Agreement among Too, Inc., various
                 lending institutions, Citicorp USA, Inc., as Syndication Agent
                 and Morgan Guaranty Trust Company of New York, as
                 Administrative Agent

         13      Excerpts from the 2001 Annual Report including "Selected
                 Financial Data", "Management's Discussion and Analysis of
                 Financial Condition and Results of Operations", "Consolidated
                 Financial Statements and Notes to Consolidated Financial
                 Statements", "Report of Management" and "Report of Independent
                 Accountants" on pages 25 through 48

         21      Subsidiaries of the Registrant

         23      Consent of Independent Accountants

         24      Power of Attorney

(b)      Reports on Form 8-K.
         --------------------

         On August 14, 2001, the Company filed a current report on Form 8-K that
         reported the Board's adoption of the Rights Agreement (also known as a
         stockholders' rights plan) contained therein.

(c)      Exhibits.
         ---------

         The exhibits to this report are listed in section (a) (3) of Item 14
         above.

(d)      Financial Statement Schedule

         None.

                                       28

<PAGE>

                                   SIGNATURES

Pursuant to the requirements of Section 13 or l5(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

Date: April 29, 2002             TOO, INC.
                                 (registrant)

                                 By /s/ Kent A. Kleeberger
                                 --------------------------
                                 Kent A. Kleeberger  Executive Vice President -
                                 Chief Financial Officer, Logistics and Systems
                                 Secretary and Treasurer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities indicated on April 17, 2002:

    Signature                    Title
    ------------                 -----

/s/ MICHAEL W. RAYDEN*           Chairman of the Board of Directors,
---------------------------      President and Chief Executive Officer
Michael W. Rayden                (Principal Executive Officer)


/s/ KENT A. KLEEBERGER*          Director, Executive Vice President -
----------------------------     Chief Financial Officer, Logistics and
Kent A. Kleeberger               Systems,Secretary and Treasurer
                                 (Principal Financial and Accounting
                                 Officer)

/s/ NANCY J. KRAMER*             Director
---------------------------
Nancy J. Kramer

/s/ DAVID A. KRINSKY*            Director
---------------------------
David A. Krinsky

/s/ PHILIP E. MALLOTT*           Director
---------------------------
Philip E. Mallott

                                       29

<PAGE>

/s/ KENNETH JAMES STROTTMAN*          Director
------------------------------------
Kenneth James Strottman

*  The undersigned, by signing his name hereto, does hereby sign this
   report on behalf of each of the above-indicated directors of the
   registrant pursuant to powers of attorney executed by such directors.

                                      By /s/ Kent A. Kleeberger
                                      -------------------------
                                      Kent A. Kleeberger
                                      Attorney-in-fact

                                       30