SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C.  20549

                                   FORM 10-KSB

[X]  ANNUAL  REPORT  UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
     OF  1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 29, 2002

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT  OF  1934

     For the transition period from _______________ to _______________.


                        COMMISSION FILE NUMBER 000-30011

                               TMI HOLDINGS, INC.
             (Exact name of registrant as specified in its charter)

                FLORIDA                                        65-0309540
     (State or other jurisdiction of                        (I.R.S. Employer
     incorporation or organization)                       Identification No.)

     11924 FOREST HILL BLVD., SUITE 22-204
              WELLINGTON, FL                                     33414
    (Address of principal executive offices)                  (Zip Code)


      REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE    (954) 579-8599


     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     No X  .
                                                       ---    ----

     Check  if  there is no disclosure of delinquent filers pursuant to Item 405
of  Regulation  S-B  is  not  contained  in this form, and no disclosure will 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-KSB
or  any  amendment  to  this  Form  10-KSB.  [   ]

     State  issuer's  revenues  for  its  most  recent fiscal year.     Zero ($)

     State  the  aggregate  market  value of voting and non-voting common equity
held  by  non-affiliates  computed by reference to the price at which the common
equity  was  sold, or the average bid and asked prices of such common equity, as
of  a  specified  date within the past 60 days.  (See definition of affiliate in
rule 12b-2 of the Exchange Act.)  $ 431,903, based on the closing price of $0.30
for  the  common  stock  on  April  29,  2003.

     Indicate  the  number of shares outstanding of each of the issuer's classes
of  common  stock,  as of the latest practicable date.  As of December 29, 2002,
there  were 189,671 (adjusted for 1 for 10 reverse stock split effective January
27, 2003) shares of common stock, par value $0.10 issued and outstanding.  As of
April  29,  2003,  there were 1,489,675 shares of common stock, par value $0.10,
issued  and  outstanding.

                       DOCUMENTS INCORPORATED BY REFERENCE

     If  the following documents are incorporated by reference, briefly describe
them and identify the part of the form 10-KSB (e.g., Part I, Part II, etc.) into
which  the  document is incorporated: (1) any annual report to security holders;
(2) any proxy or information statement; and (3) any prospectus filed pursuant to
rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act").  The listed
documents  should be clearly described for identification purposes (e.g., annual
report  to  security  holders  for  fiscal year ended December 24, 1990).  None.

                     Transitional Small Business Disclosure
                               Format (check one):

                             Yes _____     No __X__


<PAGE>
                               TMI HOLDINGS, INC.

                                TABLE OF CONTENTS
                                -----------------


                                     PART I

Item  1          Description  of  Business

Item  2          Description  of  Property

Item  3          Legal  Proceedings

Item  4          Submission  of  Matters  to  a  Vote  of  Security  Holders


                                     PART II

Item  5          Market  for  Common  Equity  and  Related  Stockholder  Matters

Item  6          Management's  Discussion  and  Analysis  or  Plan of Operations

Item  7          Financial  Statements

Item  8          Changes In and Disagreements With Accountants on Accounting and
                 Financial  Disclosure


                                    PART III

Item  9          Directors,  Executive  Officers, Promoters and Control Persons;
                 Compliance  with  Section  16(a)  of  the  Exchange  Act

Item  10         Executive  Compensation

Item  11         Security  Ownership of Certain Beneficial Owners and Management

Item  12         Certain  Relationships  and  Related  Transactions

Item  13         Exhibits  and  Reports  on  Form  8-K

Item  14             Controls  and  Procedures



<PAGE>
                                     PART I

This Annual Report includes forward-looking statements within the meaning of the
Securities Exchange Act of 1934 (the "Exchange Act"). These statements are based
on  management's beliefs and assumptions, and on information currently available
to  management.  Forward-looking  statements  include the information concerning
possible  or  assumed  future  results  of operations of TMI Holdings, Inc. (the
"Company") set forth under the heading  "Management's Discussion and Analysis or
Plan  of Operation." Forward-looking statements also include statements in which
words  such as "expect," "anticipate,"  "intend," "plan," "believe," "estimate,"
"consider"  or  similar  expressions  are  used.

Forward-looking  statements  are  not  guarantees  of  future performance.  They
involve  risks, uncertainties and assumptions.  The Company's future results and
stockholder  values  may  differ  materially  from  those  expressed  in  these
forward-looking  statements.  Readers are cautioned not to put undue reliance on
any  forward-looking  statements.

ITEM  1  -  DESCRIPTION  OF  BUSINESS

NEW  BUSINESS  DEVELOPMENTS

     On  January  31,  2003,  the  Company  acquired  100%  of  the  assets  and
outstanding  stock  of  Kina'ole  Development Corporation ("Kina'ole"), a Hawaii
corporation.  Kina'ole  is  a  wholly-owned subsidiary of the Company and is the
Company's  only  current  business  asset;  however,  going  forward the Company
intends  to  divest  Kina'ole  and  pursue the acquisition of undervalued and/or
unused  manufacturing  assets.  The  Company  has  identified  a  number  of
opportunities,  and  is  in  very  early  discussions with potential acquisition
candidates,  but  has  not  agreed  to terms or entered into a binding letter of
intent  or  similar  agreement  with  any  acquisition  candidates.

     Kina'ole  Development  Corporation

     Kina'ole  is  located  in  Lihue,  Hawaii,  and  through  joint  venture
arrangements  with  dealerships  on each Hawaiian island, Kina'ole plans to sell
manufactured  homes  to retail customers. Kina'ole also develops subdivisions of
manufactured homes and has an unrelated installation company that, as a licensed
contractor,  completes  the  foundation  and site work as well as installing the
manufactured homes. Due to the inherent uncertainty in the housing market there
is no guarantee that Kina'ole will be successful in producing manufactured homes
and/or  finding  suitable  locations for their installation. Kina'ole's officers
and  directors,  W. Michael Sessions and John W. Meyers, are former officers and
directors  of  the  Company.

     South  Beach  Beauties,  Inc.

     On  or about March 17, 2003, the Company entered into a Letter of Intent to
acquire  South  Beach  Beauties,  Inc.,  a  producer  of certain retail products
located in Sunrise, Florida. Under the terms of the Letter of Intent certain due
diligence was to be completed by May 15, 2003, in order for the Letter of Intent
to remain enforceable. The due diligence requirements under the Letter of Intent
were  not  timely  satisfied  and  the  Letter of Intent expired with no further
action  being  taken  by  the  Company.

                                        3
<PAGE>

CORPORATE  HISTORY

     TMI  Holdings,  Inc.  is  a Florida corporation; originally incorporated on
July  22,  1991,  under  the name Thrift Management, Inc.  On August 13, 2001, a
majority  of  the  Company's  common  stockholders  approved an amendment to the
Company's  Articles of Incorporation changing the name of the corporation to TMI
Holdings,  Inc.,  a  change  that  became  effective  on  August  27,  2001.

     The  Company  has  never  been  in bankruptcy, receivership, or any similar
proceeding.

     On  January 31, 2003, the Company acquired 100% of the outstanding stock of
Kina'ole Development Corporation, a Hawaii corporation. The Company acquired the
Kina'ole  shares from William Michael Sessions and John W. Meyers, who were then
directors  of the Company. In exchange for Kina'ole's shares, the Company issued
Mr.  Sessions  and  Mr.  Meyers  each  250,000  shares of the Company's Series B
Convertible  Preferred  Stock.  Prior  to  the  acquisition, the Company had not
engaged  in  any  material  business  operations  in  over  a  year.

HISTORICAL  OPERATIONS

     Until August 2001, the Company managed and operated discount retail outlets
known  as  thrift  stores,  which  dealt  in  new and used articles of clothing,
miscellaneous household items, furniture, bric-a-brac and antiques at discounted
prices.  In  2001,  the  Company  operated  six thrift stores in Florida.  These
stores  and  all  of  the Company's other business units were sold on August 27,
2001,  in a transaction involving the sale of substantially all of the Company's
assets to Thrift Ventures, Inc., a corporation that was controlled by one of the
then  Company's  principal  stockholders  at  that  date.

     After  the  sale  of  the  Company's  assets  to Thrift Ventures, Inc., the
Company's  sole  activity  was  to identify potential acquisition candidates and
attempting  to  negotiate and complete the acquisition of an operating business.
In  October 2001, the Company entered into a non-binding letter of intent with a
privately held company for a transaction that would have resulted in a change in
control of the Company.  The letter of intent was terminated in February 2002 by
mutual  agreement  of  the  parties.

     In  2002,  the  Company  underwent two changes of voting control, until its
current  management acquired voting control of the Company on February 21, 2003.
Currently, the Company's only business is the sale of manufactured homes through
Kina'ole,  the  Company's  wholly-owned  subsidiary.  Due  to  the  inherent
uncertainity  in  the housing market there is no guarantee that Kina'ole will be
successful in producing manufactured homes and/or finding suitable locations for
their  installation.  The  Company  is  currently  seeking  other  potential
acquisition  candidates.

     The  Company  currently  has no employees.  Mr. Scott Siegel, the Company's
sole  officer  and  one of its directors is an independent contractor.  Kina'ole
has  four  employees.

          The  Company's  telephone  number  is  (954)  579-8599.

ITEM  2  -  DESCRIPTION  OF  PROPERTY

     We  do  not  own  any  real  estate or any other significant property.  The
Company  currently operates from a minimal amount of space on property currently
owned by Scott Siegel, one of the Company's directors and its sole officer.  The
Company  does  not  pay  any  rent  for  this  space.

                                        4
<PAGE>

ITEM  3  -  LEGAL  PROCEEDINGS

     The  Company is from time to time involved in various pending or threatened
legal  actions.  The  litigation  process  is  inherently  uncertain  and  it is
possible  that  the  resolution  of  such  matters might have a material adverse
effect upon the financial condition and/or results of operations of the Company.
However,  in  the opinion of the Company's management, matters currently pending
or  threatened  against  the Company are not expected to have a material adverse
effect  on  the  financial  position  or  results  of operations of the Company.

     The  Company has recently become aware that some of the payments due to Mr.
Marc  Douglas under the stock purchase agreement dated October 28, 2002 have not
been  made  by  the  parties'  responsible  for  those payments. Even though the
Company  is not a party to that stock purchase agreement, and the Company has no
obligations  under  the  agreement,  if  Mr.  Douglas  brought a legal action to
rescind  the  stock  purchase  agreement  and  prevailed, then Mr. Douglas could
potentially  re-acquire  the 156,717 (adjusted for 1-for-10 reverse stock split)
shares  of  common  stock  he cancelled and re-acquire the 250,000 shares of the
Company's Series A Preferred Stock, which could result in a change of control of
the  Company.

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

     No  matters  were  submitted  to  a  vote of the Company's security holders
during  the  fourth  quarter  of  our  fiscal  year  ended  December  29,  2002.


                                        5
<PAGE>
                                     PART II

ITEM  5  -  MARKET  FOR  COMMON  EQUITY  AND  RELATED  STOCKHOLDER  MATTERS

MARKET  INFORMATION

     The  Company's common stock trades on the OTC Bulletin Board, and currently
trades  there  under  the  symbol  TMIO.  Our  common  stock is only traded on a
limited  or sporadic basis and should not be deemed to constitute an established
public  trading  market.  There  is no assurance that there will be liquidity in
the  common  stock.

     Below  is  a  table indicating the range of high and low transaction prices
for  the  common  stock for the last two fiscal years.  The information reflects
inter-dealer  prices, without retail, markup, markdown or commission and may not
represent actual transactions.  Effective January 27, 2003, the Company's common
stock  underwent  a  1-for-10  reverse  stock split.  The prices shown below are
adjusted  for  the  split.

<TABLE>
<CAPTION>



                                                  BID PRICE
<S>                                       <C>                   <C>
QUARTER ENDED                             HIGH                  LOW
----------------------------------     -------------       -------------


March 31, 2001                           $0.70                 $0.60
June 30, 2001                            $1.60                 $1.60
September 30, 2001                       $1.50                 $1.30
December 31, 2001                        $1.20                 $0.60
March 31, 2002                           $1.00                 $0.60
June 30, 2002                            $0.70                 $0.70
September 30, 2002                       $0.70                 $0.40
December 31, 2002                        $0.50                 $0.20


</TABLE>

HOLDERS

     As  of December 31, 2002, there were approximately 143 holders of record of
the common stock.  As of April 29, 2003, there were approximately 162 holders of
record  of  the  common  stock.

REVERSE  STOCK  SPLIT

     Effective January 27, 2003, the Company's common stock underwent a 1-for-10
reverse  stock  split.  The  effect  of  this  reverse  stock  split  has  been
retroactively  reflected in all numbers in this Form 10-KSB relating to a number
of  shares  or  a  stock  price.

DIVIDEND  POLICY

     We  have  never  declared  or  paid  cash dividends on the common stock and
anticipate that all future earnings, if any, will be retained as working capital
and  for business expansion.  The payment of any future dividends will be at the
sole  discretion  of  the  board  of directors and will depend upon, among other
things,  future  earnings,  capital  requirements,  our  financial condition and
general  business  conditions.  Therefore,  there  can  be no assurance that any
dividends  on  the  common  stock  will  be  paid  in  the  future.

                                        6
<PAGE>

RECENT  SALES  OF  UNREGISTERED  SECURITIES

     On  October  24,  2002,  the  Company issued 41,667 shares of the Company's
common  stock,  with  restrictive  legend,  to  Marc  Douglas  ("Douglas").  The
Company's board of directors approved this issuance during the second quarter of
fiscal  year  ended  December  29,  2002.  This issuance was made pursuant to an
agreement  entered  into  in  May 2002, between the Company and Thrift Ventures,
Inc.,  a  company  controlled  by  Douglas,  a  then officer and director of the
Company,  whereby  Thrift  Ventures,  Inc.  agreed to prepay an initial interest
payment  of  $98,926 on a Purchase Note between the Company and Thrift Ventures,
Inc.  This issuance was exempt from registration pursuant to Section 4(2) of the
Securities  Act  of  1933,  as  amended.

                                        7
<PAGE>

ITEM  6  -  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OR  PLAN  OF  OPERATION

     1.     CAUTION  REGARDING  FORWARD-LOOKING  INFORMATION

     Certain  statements  contained  in  this  annual filing, including, without
limitation, statements containing the words "believes", "anticipates", "expects"
and  words  of  similar  import,  constitute  forward-looking  statements.  Such
forward-looking  statements  involve  known and unknown risks, uncertainties and
other  factors that may cause the actual results, performance or achievements of
the  Company,  or  industry  results, to be materially different from any future
results,  performance  or  achievements  expressed  or  implied  by  such
forward-looking  statements.

     Such  factors include, among others, the following: international, national
and  local  general  economic  and  market  conditions; demographic changes; the
ability of the Company to sustain, manage or forecast its growth; the ability of
the  Company to successfully make and integrate acquisitions; raw material costs
and  availability; new product development and introduction; existing government
regulations  and  changes  in,  or  the  failure  to  comply  with,  government
regulations;  adverse  publicity; competition; the loss of significant customers
or  suppliers;  fluctuations  and  difficulty  in forecasting operating results;
changes  in  business  strategy or development plans; business  disruptions; the
ability  to  attract  and  retain  qualified  personnel;  the ability to protect
technology;  and  other  factors  referenced  in  this  and  previous  filings.

     Given  these  uncertainties,  readers of this Form 10-KSB and investors are
cautioned  not  to  place undue reliance on such forward-looking statements. The
Company  disclaims  any  obligation  to  update  any such factors or to publicly
announce  the  result  of any revisions to any of the forward-looking statements
contained  herein  to  reflect  future  events  or  developments.

     2.     INDEPENDENT  AUDITORS'  REPORT

     Our  independent  auditors have  issued  their  report  with  an
explanatory  paragraph  stating  that  the  audited  financial statements of the
company  for  the  fiscal  year  ending  December  29, 2002 have been prepared
assuming  the  Company  will  continue  as  a  going  concern.

     3.     CRITICAL  ACCOUNTING  POLICIES

     The  discussion  and  analysis  of  the  Company's  financial condition and
results  of  operations are based upon its financial statements, which have been
prepared  in  accordance  with  accounting  principles generally accepted in the
United  States.  The  preparation  of  these  financial  statements requires the
Company  to  make  estimates  and  judgments that affect the reported amounts of
assets,  liabilities,  revenues  and expenses.  To the extent there are material
differences  between  these  estimates  and  judgments  and  actual  results our
financial  statements  will  be  affected.

     There  are  no critical accounting policies due to the fact the Company did
not  have any significant assets as of December 29, 2002, or business operations
during  the  fiscal  year  ended  December  29,  2002.

                                        8
<PAGE>

COMPANY  OVERVIEW

     GENERAL

     Until August 2001, the Company managed and operated retail outlets known as
thrift  stores,  which dealt in new and used articles of clothing, miscellaneous
household  items,  furniture,  bric-a-brac and antiques at discounted prices. In
2001,  the  Company  operated  six  thrift  stores, all of which were located in
Florida. These and all of the Company's other business units were sold on August
27,  2001,  in  a  transaction  involving  the  sale of substantially all of the
Company's  assets  to  Thrift  Ventures  Inc. ("Thrift Ventures"), a corporation
controlled  by  the Company's then principal shareholder, in exchange for a note
payable equal to $1,175,000.  From August 27, 2001 through October 28, 2002, the
Company  had  no  operating  business  unit  or  subsidiaries.

     On  October  28,  2002,  the  Company's  then  principal  shareholder, Marc
Douglas,  entered  into a stock purchase agreement pursuant to which Mr. Douglas
agreed  to  sell,  through  a  series of transactions, all 250,000 shares of the
Company's  Series  A  Preferred  Stock  (the  "Preferred Stock") owned by him in
exchange  for  a  promissory  note  to  Mr.  Douglas  in the principal amount of
$150,000  due  120  days  from  the  closing. This $150,000 promissory was not a
liability  of  the Company.  The Preferred Stock sold by Mr. Douglas represented
100%  of  the outstanding Preferred Stock and, after cancellation of the 156,717
shares  of  Common  Stock  owned  by Mr. Douglas and his affiliates as discussed
below,  represented  56%  of  the  voting  control  of the Company at that time.

     In  conjunction  with  the  sale  of Mr. Douglas' Preferred Stock, the then
current  directors  of  the  Company agreed to resign from the Board and William
Michael  Sessions  and  John  W. Meyers, the ultimate purchasers of Mr. Douglas'
Preferred  Stock,  became the Company's new officers and directors. Mr. Sessions
was  appointed  to  serve  as the Company's CEO and Secretary and Mr. Meyers was
appointed  to  serve  as  the  Company's  COO  and  Treasurer.

     In  connection  with  the sale of his Preferred Stock, Mr. Douglas has also
agreed  to  cancel  the  156,717  shares  of  the Company's Common Stock and all
options  and warrants to acquire the Company's Common Stock owned by him and his
affiliates.  These  shares  of  common  stock  were  cancelled on March 6, 2003.
Pursuant  to  the  agreement,  the  Company  assigned  to  Mr.  Douglas  and his
affiliates  $675,000  of  the  outstanding  principal  balance of the $1,175,000
Purchase Note payable to the Company by an entity controlled by Mr. Douglas.  In
connection  with  this  transaction,  the  Company  entered  into  a  five-year
consulting  agreement  with Mr. Douglas whereby he agreed to provide the Company
advice  regarding  strategies  for  development  and  expansion of the Company's
business,  including  with  respect to mergers and acquisitions. As compensation
for  his  services  under  the  consulting  agreement,  the Company will assign
the remaining $500,000  balance  of  the  Purchase  Note  to  Mr.  Douglas over
the five-year  term of the consulting agreement.  This balance was written off
based on  management's  decision not to engage Mr. Douglas for any consulting
services on  behalf  of  the  Company  subsequent  to  December  29,  2002.

     RECENT  DEVELOPMENTS

     On  January  31,  2003,  the  Company  acquired  100%  of  the  assets  and
outstanding  stock  of  Kina'ole  Development Corporation, a Hawaii corporation.
The  Company acquired the Kina'ole shares from William Michael Sessions and John
W.  Meyers.  In  exchange for Kina'ole's shares, the Company issued Mr. Sessions
and  Mr.  Meyers  each  250,000  shares  of  the  Company's Series B Convertible
Preferred  Stock.

                                        9
<PAGE>

     The  Company's  Series  B Convertible Preferred Stock has no voting rights.
Additionally,  if at any time at least 5% of Kina'ole's outstanding common stock
is  distributed  to  the  Company's  stockholders  on a pro rata basis, then the
Series  B  Convertible  Preferred  Stock  shall  automatically convert into that
number  of  shares  of  common  stock  of  Kina'ole  equal  to  90%  of the then
outstanding  common  stock  of Kina'ole (after giving effect to the distribution
described  above  and  this  conversion).

     Kina'ole  is  located in Lihue, Hawaii and was formed in June 2002 with its
purpose  being  to provide an affordable housing option for the people of Hawaii
by  using  manufactured  homes.  Through  arrangements  with dealerships on each
Hawaiian  island  Kina'ole  plans  to  sell  the  manufactured  homes  to retail
customers.  Kina'ole also develops subdivisions of manufactured homes and has an
installation  company  that,  as a licensed contractor, completes the foundation
and  site work as well as installing the manufactured homes. Kina'ole's officers
and  directors,  W. Michael Sessions and John W. Meyers, are former officers and
directors  of  the  Company.

     On  or about March 17, 2003, the Company entered into a Letter of Intent to
acquire  South  Beach  Beauties,  Inc.,  a  producer  of certain retail products
located in Sunrise, Florida. Under the terms of the Letter of Intent certain due
diligence was to be completed by May 15, 2003, in order for the Letter of Intent
to remain enforceable. The due diligence requirements under the Letter of Intent
were  not  timely  satisfied  and  the  Letter of Intent expired with no further
action  being  taken  by  the  Company.

     The Company's current plans going forward are to divest Kina'ole and pursue
the  acquisition of undervalued and/or unused manufacturing assets.  The Company
has  identified a number of opportunities, and is in very early discussions with
potential  acquisition candidates, but has not agreed to terms or entered into a
binding  letter  of intent or similar agreement with any acquisition candidates.

CONTINUING  OPERATIONS

RESULTS  OF  OPERATIONS

Revenue

     Since  the  Company had no business operations during the fiscal year ended
December  29,  2002, the Company had no revenues for that period, as compared to
revenues of $6,199,675 generated by the six thrift stores during the fiscal year
ended  December  30,  2001.

Cost  of  Revenue

     Since  the  Company  did  not  have  any  revenue for the fiscal year ended
December  29, 2002, there was no cost of revenue, compared to $3,597,942 for the
fiscal  year  ended  December  30,  2001.

Gross  Profit

     There also was no gross profit for the fiscal year ended December 29, 2002,
as  compared  to  $2,601,733 gross profit generated by the six thrift stores for
the  fiscal  year  ended  December  30,  2001.

                                       10
<PAGE>

Selling,  General  and  Administrative

     The  selling, general and administrative expenses for the fiscal year ended
December  29, 2002 were $718,442.  These expenses consisted of professional fees
and  other  costs  associated with the Company's ongoing Securities and Exchange
Commission  reporting  obligations  in  addition  to  the  write  off  of a note
receivable from a former stockholder amounting to $500,000 based on management's
decision  not to engage Mr. Douglas for any consulting services on behalf of the
Company  subsequent  to  December 29, 2002. This is compared to selling, general
and  administrative  expenses  of  $2,909,049  for the same period in 2001.  The
significant  decrease  in selling, general and administrative expenses is due to
the  fact  that  the Company did have business operations during the fiscal year
ended  December  29,  2002.

Net  Losses

     The  Company  had a net loss of $623,525 for the fiscal year ended December
29,  2002,  as compared to $101,244 for the fiscal year ended December 30, 2001.
The  loss for the fiscal year ended December 29, 2002 consisted of $718,442 loss
from  operations  offset  by  $94,917  of interest income earned on the purchase
note.

LIQUIDITY  AND  CAPITAL  REQUIREMENTS

     As  of  December  29,  2002,  the Company had total current assets totaling
$7,841,  consisting  of cash and cash equivalents of $4,619 and prepaid expenses
of  $3,222.

     The Company's current liabilities were $98,944 as of December 29, 2002, and
total  liabilities  and  stockholders'  deficit  amounted  to  $7,841.

     As  of  December  29,  2002,  the Company has <$91,103> of negative working
capital  and  is  illiquid.  The  Company  has  suffered  recurring  losses from
operations  and  currently  has  no  ongoing business operations.  These factors
raise  substantial  doubt  about  the  Company's  ability to continue as a going
concern.

     Management  believes  that,  based  upon  the  current  operating  plan  of
divesting  the  majority of the Company's ownership of Kina'ole and pursuing the
acquisition  of  undervalued  and/or  unused manufacturing assets, the Company's
existing  working  capital  will  not  be  sufficient  to  fund  its acquisition
activities  and the ongoing expenses of a reporting company through December 28,
2003.  If the Company is not successful in identifying and acquiring undervalued
and/or  unused  manufacturing  assets  which  produce  positive  cash flows from
operations,  the  Company  may  be  forced  to  raise  additional equity or debt
financing  to  fund  its  ongoing  obligations,  seek  protection under existing
bankruptcy laws or cease doing business.  If additional funds are raised through
the  issuance of equity securities, the percentage of ownership of the Company's
then  common  stockholders  would  be  diluted.  If  additional funds are raised
through the issuance of debt securities, the Company will incur interest charges
until  the  related  debt  is  paid  off.

     There  can  be  no  assurance that the Company will be able to identify and
acquire  undervalued  and/or  unused manufacturing assets which produce positive
cash  flows from operations or raise any additional capital necessary to achieve
its  current  operating  plan.

                                       11
<PAGE>

ITEM  7  -  FINANCIAL  STATEMENTS

     Index  to  Financial  Statements

     TMI  Holdings,  Inc.

     Independent  Auditors'  Report                                          F-1

     Balance  Sheet  as  of  December  29,2002                               F-2

     Statements  of  Operations  for  the  fiscal  years  ended
          December  29,  2002  and  December  30,  2001                      F-3

     Statements of Stockholders' <Deficit> for fiscal years ended
          December  29,  2002  and  December  30,  2001.                     F-4

     Statements  of  Cash  Flows  for  the  fiscal  years  ended
          December  29,  2002  and  December  30,  2001                F-5 - F-6

     Notes  to  Financial  Statements                                 F-7 - F-15

ITEM  8  -  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL  DISCLOSURE

     None.


                                       12
<PAGE>
                                    PART III

ITEM  9  -  DIRECTORS,  EXECUTIVE  OFFICERS,  PROMOTERS  AND  CONTROL  PERSONS;
COMPLIANCE  WITH  SECTION  16(A)  OF  THE  EXCHANGE  ACT

Directors  and  Executive  Officers
-----------------------------------


     The  following table sets forth the names and ages of the current directors
and  executive officers of the Company, the principal offices and positions with
the  Company  held  by each person and the date such person became a director or
executive  officer  of  the  Company.  The executive officers of the Company are
elected  annually  by the Board of Directors. The directors serve one year terms
until  their  successors  are elected. The executive officers serve terms of one
year  or  until  their  death, resignation or removal by the Board of Directors.
Unless  described  below,  there  are  no  family relationships among any of the
directors  and  officers.

<TABLE>
<CAPTION>



<S>                          <C>        <C>
     Name                    Age        Position(s)
     ----                    ---        -----------

Scott Siegel                 49         Director, Chief Executive Officer, Chief
                                        Financial Officer, and Secretary

Neil Dolgin                  51         Director
</TABLE>

     Mr.  Siegel  has  been  a director of the Company since March 5, 2003.  Mr.
Siegel  has also served as Chief Executive Officer, Chief Financial Officer, and
Treasurer of the Company since March 5, 2003.  Mr. Siegel is the Chief Executive
Officer,  Secretary  and  Treasurer  of  First  Aid Direct, Inc.  He has been an
officer  and/or  director  of  First  Aid  Direct,  Inc.  since  August  1997.

     Mr.  Dolgin  has  been a director of the Company since April 29, 2003.  Mr.
Dolgin  is  also  a principal and partner at Kalmon Dolgin Affiliates, Inc., and
has  been  since  1975.  As a principal and partner at Kalmon Dolgin Affiliates,
Inc., Mr. Dolgin is responsible for determining the feasibility and requirements
for  corporate operations throughout New York City, Long Island, New Jersey, and
Miami,  including  office  site  selections,  professional and support personnel
selections,  and financial resources planning.  Mr. Dolgin received his Bachelor
of  Arts  from  University  of  Denver  and his M.B.A. from Syracuse University.

Compliance  with  Section  16(a)  of  the  Securities  Exchange  Act  of  1934
------------------------------------------------------------------------------

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors  and executive officers and persons who own more than ten percent of a
registered class of the Company's equity securities to file with the SEC initial
reports  of  ownership  and  reports of changes in ownership of Common Stock and
other  equity  securities  of the Company.  Officers, directors and greater than
ten  percent shareholders are required by SEC regulations to furnish the Company
with  copies  of  all  Section  16(a)  forms  they  file.

                                       13
<PAGE>

To the Company's knowledge, none of the required parties are delinquent in their
16(a)  filings.


                                       14
<PAGE>

Board  Meetings  and  Committees
--------------------------------

     During  the fiscal year ended December 29, 2002, the Board of Directors met
on  one  occasion  and  took  written  action  on numerous other occasions.  The
written  actions  were  by  unanimous  consent.

     There  are  no  committees  of  the  Board.

Code  of  Ethics
----------------

     Since  the  Company has recently undergone several changes in its executive
and  director  positions,  the  Company  has not yet adopted a code of ethics to
outline  the Company's expectations as they relate to honest and ethical conduct
of  its  officers.  However,  the Company intends to draft and approve a code of
ethics  in  the  near  future.

ITEM  10  -  EXECUTIVE  COMPENSATION

     The  Summary  Compensation Table shows certain compensation information for
services  rendered  in  all  capacities  for the fiscal years ended December 29,
2002, December 30, 2001, and December 31, 2000.  Other than as set forth herein,
no  executive  officer's  salary  and  bonus  exceeded  $100,000  in  any of the
applicable  years.  The  following information includes the dollar value of base
salaries,  bonus  awards,  the number of stock options granted and certain other
compensation,  if  any,  whether  paid  or  deferred.


                                       15
<PAGE>

<TABLE>
<CAPTION>
                                              SUMMARY COMPENSATION TABLE

                                       ANNUAL COMPENSATION                                  LONG TERM COMPENSATION
                                -------------------------------------      --------------------------------------------------------
                                                                                     AWARDS                      PAYOUTS
                                                                           ----------------------------    ------------------------
<S>                        <C>      <C>        <C>       <C>                <C>           <C>             <C>        <C>
                                                                            RESTRICTED     SECURITIES
                                                         OTHER ANNUAL         STOCK        UNDERLYING      LTIP      ALL OTHER
NAME AND PRINCIPAL                  SALARY     BONUS     COMPENSATION         AWARDS ($)  OPTIONS SARS    PAYOUTS   COMPENSATION
POSITION                   YEAR      ($)        ($)          ($)                              (#)           ($)         ($)


Scott Siegel(1)            2003      -0-        -0-           -0-               -0-           -0-           -0-         -0-

W. Michael Sessions        2002      -0-        -0-           -0-               -0-           -0-           -0-         -0-
(2)
John W. Melyers (3)        2002      -0-        -0-           -0-               -0-           -0-           -0-         -0-

Marc Douglas (4)           2002      -0-        -0-         25,000              -0-           -0-           -0-       25,000(5)

                           2001    286,347      -0-           -0-               -0-           -0-           -0-         -0-

                           2000    382,130     82,294      167,779              -0-           -0-           -0-         -0-

Ileen Little(6)            2001     59,200      7,000      -0-(7)               -0-          25,000         -0-         -0-

                           2000    136,400      7,000      -0-(7)               -0-          20,000         -0-         -0-

Stephen L. Wiley(8)        2001     65,385      -0-        -0-(7)               -0-          25,000         -0-         -0-

                           2000    133,691      -0-        -0-(7)               -0-           -0-           -0-         -0-
</TABLE>

     (1)  Mr. Siegel was appointed as a Director and as Chief Executive Officer,
     Chief  Financial  Officer,  and  Secretary of the Company on March 5, 2003.

     (2)  On  March 5, 2003, Mr. Sessions resigned as President and Secretary of
     the  Company.

     (3) On March 5, 2003, Mr. Meyers resigned as President and Secretary of the
     Company.

     (4) On November 7, 2002, Mr. Douglas resigned from all positions he held at
     the  Company.

     (5)  The  Company agreed to pay Thrift Ventures, Inc., an entity controlled
     by  Mr.  Douglas,  $5,000  per  month  pursuant to an agreement with Thrift
     Ventures,  Inc.  and  Mr. Douglas whereby they agreed to continue providing
     certain  services  to the Company after the Company sold its business units
     in  August  27,  2001,  including  office space, accounting and bookkeeping
     services,  and  providing  assistance with possible acquisition candidates.
     For  the  fiscal year ended December 29, 2002, the Company was obligated to
     pay  Thrift  Ventures,  Inc.  approximately  $25,000  for  these  services.

     (6)  Ms.  Little  resigned  as  the  Company's Vice President and Secretary
     following  the  sale  of  the  Company's business units on August 27, 2001.

                                       16
<PAGE>

     (7)  Perquisites  and  other  personal benefits paid to the indicated Named
     Executive  Officers  for  the  applicable periods did not exceed 10% of the
     total  of  annual  salary  and  bonus  reported.

     (8)  Mr.  Wiley resigned as the Company's Chief Financial Officer following
     the  sale  of  the  Company's  business  units  on  August  27,  2001.

                                       17
<PAGE>

<TABLE>
<CAPTION>

                                    OPTION/SAR GRANTS IN LAST FISCAL YEAR
                                             (INDIVIDUAL GRANTS)

<S>                <C>                    <C>                                <C>                         <C>
                                            PERCENT OF TOTAL
                   NUMBER OF SECURITIES      OPTIONS/SARS
                       UNDERLYING               GRANTED                      EXERCISE OR
                   OPTIONS/SARS GRANTED   TO EMPLOYEES IN FISCAL             BASE PRICE
NAME                      (#)                     YEAR                         ($/SH)                    EXPIRATION DATE

Scott Siegel              -0-                     N/A                            N/A                           N/A
W. Michael Sessions       -0-                     N/A                            N/A                           N/A
John W. Meyers            -0-                     N/A                            N/A                           N/A
Marc Douglas              -0-                     N/A                            N/A                           N/A
Jay M. Haft              2,000                    50%                          Variable*                      2007*
Howard L. Rothchild      2,000                    50%                          Variable*                      2007*

</TABLE>

     *  During  fiscal  year ended December 29, 2002, Mr. Haft and Mr. Rothchild
     were  issued  options  to  purchase common stock of the Company as follows:
     1,000  each  on  March  31, 2002 at an exercise price of $0.50; 500 each on
     June  30, 2002 at an exercise price of $0.70; and 500 each on September 29,
     2002  at an exercise price of $0.40. All of these options expire five years
     from  the  date  of  the  grant.

<TABLE>
<CAPTION>

                            AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
                                        AND FY-END OPTION/SAR VALUES

<S>                  <C>                   <C>                  <C>                         <C>
                                                                                              VALUE OF UNEXERCISED
                                                                  NUMBER OF UNEXERCISED          IN-THE-MONEY
                                                                SECURITIES UNDERLYING          OPTION/SARS
                     SHARES ACQUIRED ON                         OPTIONS/SARS AT FY-END (#)        AT FY-END ($)
NAME                    EXERCISE ($)                            EXERCISABLE/UNEXERCISABLE             ($)
                                           VALUE REALIZED ($)                               EXERCISABLE/UNEXERCISABLE

Scott Siegel                -0-                    N/A                    N/A                         N/A

W. Michael Sessions         -0-                    N/A                    N/A                         N/A

John W. Meyers              -0-                    N/A                    N/A                         N/A

Marc Douglas                -0-                    N/A                    N/A                         N/A

</TABLE>

COMPENSATION  OF  DIRECTORS

     During  fiscal year ended December 29, 2002, two of the former Directors of
the  Company  each  received  options  to purchase 2,000 shares of the Company's
common stock as compensation for serving on the Board of Directors.  The current
Directors  of  the  Company  receive  no compensation as a Director but they are
entitled  to  reimbursement  for their travel expenses. The Company does not pay
additional  amounts  for  committee  participation or special assignments of the
Board  of  Directors.

                                       18
<PAGE>
ITEM  11  -  SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS AND MANAGEMENT

     The  following  table sets forth, as of April 29, 2003, certain information
with  respect to the Company's equity securities owned of record or beneficially
by  (i)  each  Officer  and  Director  of the Company; (ii) each person who owns
beneficially  more  than  5%  of  each class of the Company's outstanding equity
securities;  and  (iii)  all  Directors  and  Executive  Officers  as  a  group.

<TABLE>
<CAPTION>






                                  Common Stock
                                 --------------


<S>             <C>                                     <C>                        <C>
                Name and Address of                     Amount and Nature of       Percent
                                                                                   ------------
Title of Class  Beneficial Owner (1)                    Beneficial Ownership       of Class (2)
--------------  --------------------                    --------------------       ------------

Common
Stock           Scott Siegel(3)                                    1,050,000(4)        73%

Common
Stock           Neil Dolgin(5)                                             0          0.0%


Common          All officers and directors as a group
Stock           (2 persons)                                        1,050,000           73%
</TABLE>

     (1)  Unless  otherwise  noted,  the address of each beneficial owner is c/o
          TMI  Holdings, Inc., 11924 Forest Hill Blvd., Suite 22-204, Wellington
          Florida  33414.

     (2)  Based  on  1,489,675  shares  outstanding  as  of  April  29,  2003.

     (3)  Mr.  Siegel  is  a  Director  of  the  Company and the Chief Executive
          Officer,  Chief  Financial  Officer,  and  Secretary  of  the Company.

     (4)  Only 1,000,000 shares have been issued to date.

     (5)  Mr.  Dolgin  is  a  Director  of  the  Company.

<TABLE>
<CAPTION>




                                      Series A Preferred Stock(1)
                                      ---------------------------
<S>                          <C>                                     <C>                        <C>
                             Name and Address of                     Amount and Nature of       Percent
Title of Class               Beneficial Owner(2)                     Beneficial Ownership       of Class
--------------               -------------------                     --------------------       --------

Series A
Preferred                    Scott Siegel(3)                                 250,000              100%

Series A
Preferred                    Neil Dolgin(4)                                     -0-                0%

Series A                     All officers and directors as a group
Preferred                    (2 persons)                                     250,000              100%
</TABLE>

                                       19
<PAGE>

     (1)  Each  Share  of  Series A Preferred Stock has 10 to 1 voting rights on
          any  matters  properly  brought before the shareholders of the Company
          for  a vote. Shares of Series A Preferred Stock do not have conversion
          rights.

     (2)  Unless  otherwise  noted,  the address of each beneficial owner is c/o
          TMI  Holdings, Inc., 11924 Forest Hill Blvd., Suite 22-204, Wellington
          Florida  33414.

     (3)  Mr.  Siegel  is  a  Director  of  the  Company and the Chief Executive
          Officer,  Chief  Financial  Officer,  and  Secretary  of  the Company.

     (4)  Mr.  Dolgin  is  a  Director  of  the  Company.

<TABLE>
<CAPTION>

                                   Series B Preferred Stock(1)
                                   ---------------------------
<S>                          <C>                                     <C>                        <C>
                             Name and Address of                     Amount and Nature of       Percent
Title of Class               Beneficial Owner(2)                     Beneficial Ownership      of Class
--------------               -------------------                     --------------------      --------

Series B
Preferred                    W. Michael Sessions                             250,000             50%

Series B
Preferred                    John W. Meyers                                  250,000             50%

Series B
Preferred                    Scott Siegel(3)                                    -0-               0%

Series B
Preferred                    Neil Dolgin(4)                                     -0-               0%

Series B                     All officers and directors as a group
Preferred                    (2 persons)                                         0                0%
</TABLE>

     (1)  The  creation  of  a  class  of Series B Preferred Stock, with 500,000
          shares authorized, was approved by the Company's board of directors on
          January  31,  2003.  Shares  of  Series  B Preferred Stock do not have
          voting  rights.

     (2)  Unless  otherwise  noted,  the address of each beneficial owner is c/o
          TMI  Holdings, Inc., 11924 Forest Hill Blvd., Suite 22-204, Wellington
          Florida  33414.

     (3)  Mr.  Siegel  is  a  Director  of  the  Company and the Chief Executive
          Officer,  Chief  Financial  Officer,  and  Secretary  of  the Company.

     (4)  Mr.  Dolgin  is  a  Director  of  the  Company.

ITEM  12  -  CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS

Certain  Relationships  and  Related  Transactions
--------------------------------------------------

Marc  Douglas  Stock  Sale

     On  October  28,  2002,  the  Company's  then-principal  stockholder,  Marc
Douglas,  entered  into a stock purchase agreement pursuant to which Mr. Douglas
agreed  to  sell,  through  a  series of transactions, all 250,000 shares of the
Company's  Series  A Preferred Stock (the "Preferred Stock") owned by him and to
cancel  156,717 shares of common stock owned by him in exchange for a promissory
note  to  Mr.  Douglas in the principal amount of $150,000 due 120 days from the
closing.  The  Preferred  Stock  sold  by  Mr.  Douglas  represented 100% of the
outstanding  Series  A  Preferred  Stock  and, after cancellation of the 156,717
shares  of  Common  Stock  owned  by Mr. Douglas and his affiliates as discussed
below,  represented  56%  of the voting control of the Company.  The closing for
the  sale took place upon the satisfaction of all closing conditions on December
18,  2002.

                                       20
<PAGE>

     In  conjunction  with  the  sale  of  Mr.  Douglas'  Preferred  Stock,  the
then-current  directors  of  the  Company  resigned  from  the Board and William
Michael  Sessions  and John W. Meyers were appointed to the Board.  In addition,
Mr.  Sessions  was appointed to serve as the Company's CEO and Secretary and Mr.
Meyers  was  appointed  to  serve  as  the  Company's  COO  and  Treasurer.

     In  connection  with  the  sale  of  his  Preferred Stock, Mr. Douglas also
cancelled  156,717  shares  of the Company's Common Stock and 60,500 options and
warrants  to acquire the Company's Common Stock owned by him and his affiliates.
The  Company's new Board of Directors assigned to Mr. Douglas and his affiliates
$675,000  of  the  outstanding principal balance of the $1,175,000 Purchase Note
payable  to  the  Company  by an entity controlled by Mr. Douglas. In connection
with this transaction, the Company entered into a five-year consulting agreement
with  Mr.  Douglas  whereby  he  agreed  to provide the Company advice regarding
strategies  for  development  and expansion of the Company's business, including
with  respect  to  mergers  and  acquisitions,  in  exchange  for the consulting
agreement.  The  Company  has  written  off  the  remaining $500,000 of the note
receivable from the former stockholder as of December 29, 2002. This balance was
written  off  based  on  management's decision not to engage Mr. Douglas for any
consulting  services  on  behalf of the Company subsequent to December 29, 2002.

     As  a  result of this transaction there was both a change of voting control
of the Company and a change in its management, including its Board of Directors.

Thrift  Ventures,  Inc.'s  Services.

     In  August 2001, The Company agreed to pay Thrift Ventures, Inc., an entity
controlled  by Mr. Douglas,  the Company's past officer and director, $5,000 per
month  in  agreement  for  Thrift Ventures, Inc.'s and Mr. Douglas' agreement to
continue  providing  certain  services to the Company after the Company sold its
business  units  in  August  27,  2001,  including  office space, accounting and
bookkeeping  services,  and  providing  assistance  with  possible  acquisition
candidates.  For  the  fiscal  year  ended  December  29,  2002, the Company was
obligated to pay Thrift Ventures, Inc. approximately $45,000 for these services.

Thrift  Venture,  Inc.'s  Prepayment  Under  Payment  Note

     On  October  24,  2002,  the  Company issued 41,667 shares of the Company's
common  stock,  with  restrictive  legend,  to  Marc  Douglas  ("Douglas").  The
Company's board of directors approved this issuance during the second quarter of
fiscal  year  ended  December  29,  2002.  This issuance was made pursuant to an
agreement  entered  into  in  May 2002, between the Company and Thrift Ventures,
Inc.,  a  company  controlled  by  Douglas,  a  then officer and director of the
Company,  whereby  Thrift  Ventures,  Inc.  agreed to prepay an initial interest
payment  of  $98,926 on a Purchase Note between the Company and Thrift Ventures,
Inc.  This issuance was exempt from registration pursuant to Section 4(2) of the
Securities  Act  of  1933,  as  amended.

                                       21
<PAGE>

Kina'ole  Development  Corporation

     On  January  31,  2003, TMI Holdings, Inc. (the "Company") acquired 100% of
the outstanding stock of Kina'ole Development Corporation ("Kina'ole"), a Hawaii
corporation.  Kina'ole  is  located  in  Lihue, Hawaii, and through arrangements
with  dealerships  on  each Hawaiian island Kina'ole, plans to sell manufactured
homes  to  retail  customers.  Due  to  the inherent uncertainity in the housing
market  there  is  no  guarantee  that  Kina'ole will be successful in producing
manufactured  homes  and/or  finding  suitable locations for their installation.
The  Company acquired the Kina'ole shares from William Michael Sessions and John
W.  Meyers,  both of whom were officers and directors of the Company at the time
of  the  transaction.  In exchange for Kina'ole's shares, the Company issued Mr.
Sessions  and  Mr.  Meyers  each  250,000  shares  of  the  Company's  Series  B
Convertible  Preferred  Stock.

     The  Company's  Series  B Convertible Preferred Stock has no voting rights.
Additionally, if at any time, at least 5% of Kina'ole's outstanding common stock
is  distributed  to  the  Company's  stockholders  on a pro rata basis, then the
Series  B  Convertible  Preferred  Stock  shall  automatically convert into that
number  of  shares  of  common  stock  of  Kina'ole  equal  to  90%  of the then
outstanding  common  stock  of Kina'ole (after giving effect to the distribution
described  above  and  this  conversion).

Scott  Siegel

     On  February  21, 2003, the Company entered into a Stock Purchase Agreement
with its then-current directors, Mr. W. Michael Sessions and John W. Meyers, and
Mr. Scott Siegel, whereby the Company agreed to issue 1,050,000 shares of common
stock  (1,000,000  has  been issued to date) to Mr. Siegel, and Mr. Sessions and
Mr. Meyers transferred 250,000 shares of Series A Preferred Stock to Mr. Siegel,
all  in  exchange  for  Mr.  Siegel  agreeing  to  pay  approximately $72,500 in
outstanding Company liabilities and $150,000 for outstanding amounts owed by Mr.
Sessions and Mr. Meyers to Marc Douglas.  On March 5, 2003, Mr. Sessions and Mr.
Meyers  resigned  as  directors  of  the  Company  and Mr. Siegel, who was not a
related  party  to the Company at the time of the transaction, became an officer
and  director  of  the  Company  on  March  5,  2003.


                                       22
<PAGE>
ITEM  13  -  EXHIBITS  AND  REPORTS  ON  FORM  8-K

     (A)     EXHIBITS


     EXHIBIT  NO.          DESCRIPTION
     ---------------------------------

     3.1(1)    Certificate  of  Incorporation,  as  amended, of the Registrant.

     3.2(1)    Bylaws  of  the  Registrant

     99.1      Chief Executive Officer and Chief Financial Officer Certification
                Pursuant to 18 USC, Section 1350, as Adopted Pursuant to Section
                906  of  the  Sarbanes-Oxley  Act  of  2002.
__________
     (1)     Incorporated  by  reference  from  the  exhibits  to  the Company's
Registration  Statement  on  Form  SB-2  (File  No.  333-5190-A).

     (B)     REPORTS  ON  FORM  8-K

     On  February 11, 2003, the Company filed a Report on Form 8-K regarding the
Company's  acquisition  of 100% of the outstanding stock of Kina'ole Development
Corp.  In  this  Form  8-K  the  Company  stated it would be filing a subsequent
Report  on  Form  8-K,  which  would  include  audited  historical and pro forma
financial  statements  for Kina'ole.  The Company has not yet filed the Form 8-K
with  the  audited  historical  and  pro forma financial statement for Kina'ole.

ITEM  14  -  CONTROLS  AND  PROCEDURES

     The Company's Chief Executive Officer and Chief Financial Officer (or those
persons performing similar functions), after evaluating the effectiveness of the
Company's  disclosure controls and procedures (as defined in Rules 13a-14(c) and
15d-14(c)  under  the  Securities Exchange Act of 1934, as amended) as of a date
within 90 days of the filing of this annual report (the "Evaluation Date"), have
concluded that, as of the Evaluation Date, the Company's disclosure controls and
procedures  were  effective  to  ensure  the  timely  collection, evaluation and
disclosure  of  information  relating  to  the Company that would potentially be
subject to disclosure under the Securities Exchange Act of 1934, as amended, and
the  rules  and  regulations  promulgated thereunder.  There were no significant
changes  in  the  Company's  internal  controls  or  in other factors that could
significantly  affect  the  internal controls subsequent to the Evaluation Date.

                                       23
<PAGE>
                                   SIGNATURES

     In  accordance  with  Section 13 or 15(d) of The Securities Act of 1993, as
amended,  the  Company  caused  this  report  to  be signed on its behalf by the
undersigned,  thereto  duly  authorized.


                                                              TMI HOLDINGS, INC.


Dated:  May  23,  2003                              By:  /s/ Scott Siegel
                                                         -----------------------
                                                                    Scott Siegel
                                                        Chief Executive Officer,
                                             Chief Financial Officer, Secretary,
                                                                    and Director


     In  accordance  with  The Securities Exchange Act of 1934, as amended, this
report  has  been signed below by the following persons on behalf of the Company
and  in  the  capacities  and  on  the  date  as  indicated.

Dated:  May  23,  2003                              By:  /s/ Neil Dolgin
                                                         -----------------------
                                                                     Neil Dolgin
                                                                        Director



                                       24
<PAGE>
                    CERTIFICATION OF CHIEF EXECUTIVE OFFICER
                           AND CHIEF FINANCIAL OFFICER

     I, Scott Siegel, Chief Executive Officer and Chief Financial Officer of the
registrant,  certify  that:

1.     I  have reviewed this annual report on Form 10-KSB of TMI Holdings, Inc.;

2.     Based  on  my  knowledge,  this annual report does not contain any untrue
statement  of a material fact or omit to state a material fact necessary to make
the  statements  made, in light of the circumstances under which such statements
were  made,  not  misleading  with  respect to the period covered by this annual
report;

3.     Based  on  my  knowledge,  the  financial statements, and other financial
information  included  in  this  annual  report,  fairly present in all material
respects  the  financial  condition, results of operations and cash flows of the
registrant  as  of,  and  for,  the  periods  presented  in  this annual report.

4.     The registrant's certifying officers are responsible for establishing and
maintaining  disclosure controls and procedures (as defined in Exchange Act Rule
13a-14  and  15d-14)  for  the  registrant  and  have:

     a)   designed  such  disclosure  controls  and  procedures  to  ensure that
          material  information  relating  to  the  registrant is made known to
 us by others within those entities,  particularly  during the period
 in which this annual report is  being  prepared;

     b)   evaluated  the  effectiveness  of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this  annual  report  (the  "Evaluation  Date");  and

     c)   presented  in  this  annual  report  our  conclusions  about  the
          effectiveness  of  the disclosure controls and procedures based on our
          evaluation  as  of  the  Evaluation  Date;

5.     The  registrant's  certifying  officers have disclosed, based on our most
recent  evaluation,  to  the  registrant's  auditors  and the audit committee of
registrant's  board  of  directors  (or  persons  fulfilling  the  equivalent
functions):

          (i)  all  significant  deficiencies  in  the  design  or  operation of
               internal  controls  which could adversely affect the registrant's
               ability  to record, process, summarize, and report financial data
               and  have  identified  for the registrant's auditors any material
               weaknesses  in  internal  controls;  and

          (ii) any  fraud,  whether or not material, that involves management or
               other  employees  who  have  a  significant  role in the issuer's
               internal  controls;

                                       25
<PAGE>

6.     The registrant's certifying officers have indicated in this annual report
whether  or  not there were significant changes in internal controls or in other
factors that could significantly affect internal controls subsequent to the date
of  our  most recent evaluation, including any corrective actions with regard to
significant  deficiencies  and  material  weaknesses.

Dated:     May  23,  2003
                                                  /s/ Scott Siegel
                                                ________________________________
                                                Scott  Siegel
                                                Chief  Executive  Officer, Chief
                                                Financial  Officer,  Secretary
                                                and  Director


                                       26
<PAGE>

                          INDEPENDENT AUDITORS' REPORT

TO  THE  BOARD  OF  DIRECTORS  AND  STOCKHOLDERS  OF  TMI  HOLDINGS,  INC.

We  have audited the accompanying balance sheet of TMI Holdings, Inc., (formerly
Thrift  Management,  Inc.) as of December 29, 2002 and the related statements of
operations,  stockholders'  deficit,  and  cash flows for the fiscal years ended
December  29,  2002  and  December  30, 2001. These financial statements are the
responsibility  of the Company's management. Our responsibility is to express an
opinion  on  these  financial  statements  based  on  our  audits.

We conducted our audits in accordance with auditing standards generally accepted
in  the  United  States  of  America.  Those  standards require that we plan and
perform  the  audits  to obtain reasonable assurance about whether the financial
statements are free of material misstatements. An audit includes examining, on a
test  basis,  evidence  supporting  the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made  by  management,  as well as evaluating the overall
financial  statement  presentation.  We  believe  that  our  audits  provide  a
reasonable  basis  for  our  opinion.

In  our  opinion,  the financial statements referred to above present fairly, in
all  material  respects,  the  financial  position  of TMI Holdings, Inc., as of
December  29, 2002, and the results of its operations and its cash flows for the
fiscal  years  ended December 29, 2002 and December 30, 2001, in conformity with
accounting  principles  generally  accepted  in  the  United  States of America.

The  accompanying  financial  statements  have  been  prepared assuming that TMI
Holdings, Inc., will continue as a going concern.  As discussed in Note 2 to the
financial statements, the Company has suffered recurring losses from operations,
has a  stockholders'  deficit, and currently has no ongoing business activities.
These  factors  raise substantial doubt about its ability to continue as a going
concern.  Management's  plans  in  regard to these matters are also described in
Note  2.  The  financial  statements  do  not include any adjustments that might
result  from  the  outcome  of  this  uncertainty.


                     /s/ Berkowitz Dick Pollack & Brant LLP




Fort  Lauderdale,  Florida,
May  23,  2003.

                                      F-1
<PAGE>

<TABLE>
<CAPTION>

                               TMI HOLDINGS, INC.
                       (FORMERLY THRIFT MANAGEMENT, INC.)


                                  BALANCE SHEET

<S>                                                            <C>

                                                               December 29, 2002
                                                               -----------------
ASSETS
CURRENT ASSETS
     Cash and cash equivalents                                   $     4,619
     Prepaid expenses                                                  3,222
                                                                 -----------

         TOTAL ASSETS                                            $     7,841
                                                                 ===========

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
     Accrued expenses                                            $    98,944
                                                                 -----------
         TOTAL CURRENT LIABILITIES                                    98,944
                                                                 -----------

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' DEFICIT
     Preferred stock:  $.01 par value, authorized 1,500,000
         shares, issued and outstanding 250,000 shares                 2,500
     Common stock:  $.10 par value, authorized 1,500,000
         shares, issued and outstanding 189,671 shares                18,967
     Additional paid-in-capital                                    3,833,593
     Accumulated deficit                                          (3,946,163)
                                                                 -----------
         TOTAL STOCKHOLDERS' DEFICIT                                 (91,103)
                                                                 -----------
         TOTAL LIABILITIES AND
              STOCKHOLDERS' DEFICIT                              $     7,841
                                                                 ===========



See accompanying notes.
</TABLE>

                                      F-2
<PAGE>

<TABLE>
<CAPTION>

                               TMI HOLDINGS, INC.
                       (FORMERLY THRIFT MANAGEMENT, INC.)


                            STATEMENTS OF OPERATIONS

<S>                                               <C>               <C>

                                                              FISCAL
                                                  -----------------------------
                                                      2002              2001
                                                  -----------       -----------
Net sales                                         $        --       $ 6,199,675

Cost of goods sold                                         --         3,597,942
                                                  -----------       -----------

GROSS PROFIT                                               --         2,601,733

Selling, general and administrative expenses          218,442         2,909,049

Write off of note receivable from
   former stockholder                                 500,000                --
                                                  -----------       -----------

(LOSS) FROM OPERATIONS                               (718,442)         (307,316)

Loss on disposal of fixed assets                           --          (138,336)
Interest expense                                           --           (27,092)
Interest income                                        94,917            51,948
                                                  -----------       -----------

(LOSS) BEFORE PROVISION FOR INCOME
         TAXES AND EXTRAORDINARY ITEM                (623,525)         (420,796)

Provision for income taxes                                 --           (89,000)
                                                  -----------       -----------

(LOSS) BEFORE
         EXTRAORDINARY ITEM                          (623,525)         (509,796)

Extraordinary gain on convertible
   debenture settlement                                    --           408,552
                                                  -----------       -----------

         NET (LOSS)                               $  (623,525)      $ (101,244)
                                                  ===========       ===========

Basic and diluted (loss) per share:
         (Loss) before extraordinary item         $    (1.96)      $      (1.70)
         Extraordinary item                                --              1.36
                                                  -----------       -----------
                  Net (loss) per share            $    (1.96)      $     (0.34)
                                                  ===========       ===========

Weighted average number of shares:
         Basic and diluted                            317,844           300,106
                                                  ===========       ===========


See accompanying notes.
</TABLE>

                                      F-3
<PAGE>

<TABLE>
<CAPTION>

                                                   TMI HOLDINGS, INC.

                                           (FORMERLY THRIFT MANAGEMENT, INC.)

                                           STATEMENTS OF STOCKHOLDERS' DEFICIT


<S>                           <C>          <C>         <C>         <C>        <C>          <C>           <C>


                               PREFERRED STOCK           COMMON STOCK         Additional
                              --------------------     ------------------      Paid-in     Accumulated   Stockholders'
                              Shares        Amount     Shares      Amount      Capital        Deficit        Deficit
                              ------        ------     ------      ------     ----------   ------------  --------------

Balance, fiscal 2000          250,000      $2,500       284,721    $28,472      $4,056,499   $(3,221,394)    $  866,077

Common Stock issued on
  convertible debenture
  settlement agreement           --          --        20,000       2,000         30,000            --           32,000

Capital contribution on
  sale of business units         --          --           --         --          385,589            --          385,589


Net (loss) for fiscal 2001       --          --           --         --             --         (101,244)       (101,244)
                              -------     ------     ---------     -------     ----------   -----------     ------------
Balance, fiscal 2001          250,000      2,500       304,721      30,472      4,472,088    (3,322,638)       1,182,422

Common Stock issued               --         --        41,667       4,167         20,833           --             25,000

Common Stock cancelled            --         --      (156,717)    (15,672)      (659,328)          --          (675,000)

Net (loss) for fiscal 2002        --         --           --          --            --         (623,525)       (623,525)
                              -------     ------     ---------     -------     ----------   -----------      -----------
Balance, fiscal 2002          250,000     $2,500       189,671     $18,967     $3,833,593   $(3,946,163)   $    (91,103)
                              =======     ======     =========     =======     ==========   ===========    =============



See accompanying notes.
</TABLE>

                                      F-4
<PAGE>

<TABLE>
<CAPTION>

                                           TMI HOLDINGS, INC.
                                  (FORMERLY THRIFT MANAGEMENT, INC.)


                                      STATEMENTS OF CASH FLOWS
<S>                                                                                <C>                <C>

                                                                                                FISCAL
                                                                                    -----------------------------
                                                                                         2002              2001
                                                                                    -----------       -----------
Cash flows from operating activities:
     Net (loss)                                                                     $  (623,525)      $  (101,244)
     Adjustments to reconcile net (loss) to net cash (used in)
         provided by operating activities:
              Write off of note receivable from former stockholder                      500,000                --
              Deferred income tax                                                            --            89,000
              Depreciation and amortization                                                  --            96,566
              Loss on disposal of fixed assets                                               --           138,336
              Amortization of prepaid consulting expenses paid
                    with common stock and warrants                                           --            86,327
              Extraordinary gain on convertible debenture settlement                         --          (408,552)

Changes in assets and liabilities:
     Decrease in merchandise inventories                                                     --            68,784
     Decrease (increase) in escrow receivable                                            25,000           (25,000)
     Decrease (increase) in stockholder interest receivable                              32,979           (32,979)
     Decrease (increase) in prepaid expenses                                                792           (57,969)
     Increase in accounts payable                                                            --           134,946
     Increase in accrued expenses                                                        16,573            27,986

                                                                                    -----------       -----------
         Total adjustments                                                              575,344           117,445
                                                                                    -----------       -----------

NET CASH (USED IN) PROVIDED BY OPERATING
     ACTIVITIES                                                                         (48,181)           16,201
                                                                                    -----------       -----------

Cash flows from investing activities:
     Purchase of property and equipment                                                      --           (15,958)
     Proceeds from disposal of fixed assets                                                  --             8,000
     Payment in connection with the sale of business units                                   --          (147,197)
                                                                                    -----------       -----------

NET CASH (USED IN) INVESTING ACTIVITIES                                                      --          (155,155)
                                                                                    -----------       ------------

Cash flows from financing activities:
     Common shares issued                                                                25,000                --
     Cash payment - convertible debenture settlement                                         --          (200,000)
     Cash payment - notes                                                                    --           (30,082)
                                                                                    -----------       -----------

NET CASH PROVIDED BY (USED IN) FINANCING
     ACTIVITIES                                                                          25,000         (230,082)
                                                                                    -----------       -----------

     NET (DECREASE) IN CASH                                                             (23,181)         (369,036)

CASH AND CASH EQUIVALENTS - BEGINNING OF
     PERIOD                                                                              27,800           396,836
                                                                                    -----------       -----------

CASH AND CASH EQUIVALENTS - END OF PERIOD                                           $     4,619       $    27,800
                                                                                    ===========       ===========


</TABLE>

                                      F-5
<PAGE>

<TABLE>
<CAPTION>

                                            TMI HOLDINGS, INC.
                                    (FORMERLY THRIFT MANAGEMENT, INC.)


                                        STATEMENTS OF CASH FLOWS

<S>                                                                                   <C>                <C>

                                                                                                  FISCAL
                                                                                      -----------------------------
                                                                                          2002              2001
                                                                                      -----------       -----------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
         INFORMATION:

     Cash paid during the period for
         Interest                                                                     $        --       $     9,639
                                                                                      ===========       ===========
         Income taxes                                                                 $        --       $        --
                                                                                      ===========       ===========

SCHEDULE OF NON-CASH INVESTING AND
     FINANCING ACTIVITIES:

     During fiscal 2001, the Company sold the assets and liabilities of its
     business units for a note receivable amounting to $1,175,000. In
     conjunction with the sale, net assets and liabilities were sold as follows:

     Assets  sold  in  connection  with  the  sale  of business units                 $ 1,548,124

     Liabilities  assumed  in  connection  with  the  sale  of
               business units                                                           (905,910)

     Stockholder  note  receivable  recorded                                          (1,175,000)
                                                                                       ----------

     Capital contribution from Stockholder                                              (532,786)

     Less cash payment to stockholder in connection with
               the sale of the business units                                            147,197
                                                                                      -----------
     Capital contribution recorded
               related to the sale of the business units                              $  (385,589)
                                                                                      ===========


During fiscal 2002, the Company exchanged a note receivable amounting
to $675,000 (obtained in conjunction with the sale of its business units)
for 156,717 shares of common stock:

     Note receivable                                                                  $   675,000
                                                                                      -----------

     156,717 shares of common stock ($.10 par value per share)                             15,672

     Paid-in capital                                                                      659,328
                                                                                      -----------
                                                                                      $   675,000
                                                                                      ===========


See accompanying notes.


</TABLE>

                                      F-6
<PAGE>

                               TMI HOLDINGS, INC.
                       (FORMERLY THRIFT MANAGEMENT, INC.)

                          NOTES TO FINANCIAL STATEMENTS

NOTE  1  --  GENERAL

TMI  Holdings,  Inc. (the "Company" or "TMI"), formerly Thrift Management, Inc.,
was  organized  in  the  State  of  Florida  on July 22, 1991 for the purpose of
managing  the  operations of retail thrift stores which offered for sale new and
used  articles  of  clothing,  furniture,  miscellaneous  household  items  and
antiques. The Company was registered with the State of Florida as a professional
solicitor.  The  Company obtained its merchandise primarily from two sources: i)
purchase  agreements with charitable organizations, and ii) independent contract
collectors  from  whom the Company purchased merchandise in bulk. Items from the
stores  which  remain  unsold  were  sold  in  bulk  to  exporters for export to
countries  throughout  the  Caribbean,  Central  and  South  America and Eastern
Europe.  Through  its wholly owned subsidiaries, the Company operated six retail
stores,  an  Internet  company  and  a  management  company.  Hallandale  Thrift
Management,  Inc. ("HTMI"), was responsible for the solicitation of donations on
behalf of the affiliated charities through direct mailing, newspaper advertising
and telemarketing. HTMI was also responsible for operating donation trailers and
the  pick-up  of  donated  merchandise  throughout  the communities in which the
Company  operated.  HTMI  was  organized  in the State of Florida on December 9,
1993.

The Company operated six retail thrift stores that offered new and used articles
of  clothing,  furniture,  miscellaneous  household  items  and antiques, and an
Internet  subsidiary  which  operated  a  business-to-consumer site that offered
collectibles,  art  and antiques on a limited basis, until August 27, 2001, when
the  sale  of  these  business  units  to  the  Company' President and principal
stockholder  was  completed. This transaction had been approved by the Company's
stockholders  (with  all  shares held by the President and his affiliates voting
with the majority of all other outstanding shares) at the annual meeting held on
August  13,  2001.  As  a  result  of  the  sale  of its business units that was
completed  on  August  27,  2001,  the Company no longer has any subsidiaries or
active  business  units.  The  Company has minimized its ongoing expenses during
this  period,  which  are limited to compliance with the Company's SEC reporting
obligations,  identifying  possible  acquisition  candidates  and  negotiating
possible  transactions,  and  other  incidental  corporate  activities.

NOTE  2  -  GOING  CONCERN

The  accompanying  financial  statements  have  been prepared on a going concern
basis,  which  contemplates  the  realization  of assets and the satisfaction of
liabilities  in  the  normal  course  of business.  The Company has incurred net
losses  of  approximately  $624,000  and  $101,000  for  the  fiscal years ended
December  29,  2002  and  December  30, 2001, and has negative working capital
amounting  to  approximately  $91,000  at  December  29,  2002.

The  Company  has suffered recurring losses from operations, has stockholders'
deficit and currently has no ongoing  business  operations.  These  factors
raise substantial doubt about the Company's  ability  to  continue  as  a
going  concern.

Management believes that, based upon the current operating plan of divesting the
majority  of  the  Company's  ownership  of  Kina'ole  (Note 8) and pursuing the
acquisition  of  undervalued  and/or  unused manufacturing assets, the Company's
existing  working  capital  will  not  be  sufficient  to  fund  its acquisition
activities  and the ongoing expenses of a reporting company through December 28,
2003.  If the Company is not successful in identifying and acquiring undervalued
and/or  unused  manufacturing  assets  which  produce  positive  cash flows from
operations,  the  Company  may  be  forced  to  raise  additional equity or debt
financing  to  fund  its  ongoing  obligations,  seek  protection under existing
bankruptcy laws or cease doing business.  If additional funds are raised through
the  issuance  of  equity  securities, the percentage ownership of the Company's
then-current  stockholders  would  be  diluted.  If  additional funds are raised
through the issuance of debt securities, the Company will incur interest charges
until  the  related  debt  is  paid  off.

                                      F-7
<PAGE>

There  can be no assurance that the Company will be able to identify and acquire
undervalued and/or unused manufacturing assets which produce positive cash flows
from  operations  or raise any required capital necessary to achieve its current
operating  plan.

NOTE  3  -  SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

BASIS  OF  PRESENTATION:  The  financial statements for fiscal 2001 included the
accounts  of  the  Company  and its wholly owned subsidiaries through August 27,
2001,  the  date  the  subsidiaries  were  sold.  All inter-company accounts and
transactions  have  been  eliminated.

ACCOUNTING  PERIOD: The Company's fiscal year is the 52-53 week period ending on
the  Sunday  closest  to  December  31.  Fiscal 2002 and 2001 included a 52-week
period.  Consequently,  the Company's fiscal 2002 and 2001 years encompassed the
periods  of  December  31,  2001  through  December 29, 2002 and January 1, 2001
through  December  30,  2001,  respectively.

STOCK SPLIT:  Effective January 27, 2003, the Company's common stock underwent a
1  for  10  reverse stock split.  The effect of the reverse stock split has been
retroactively  reflected  in  the  financial  statements  for all fiscal periods
presented.

EQUIPMENT,  FIXTURES AND IMPROVEMENTS: Equipment, fixtures and improvements were
recorded at the lower of cost or estimated fair value. Depreciation was provided
using  the  straight-line method over the estimated useful lives (5-10 years) of
the related assets. Leasehold improvements were amortized over the lesser of the
related  lease  terms  including  options  or  the estimated useful lives of the
improvements. Maintenance and repairs are charged to operations as incurred. For
fiscal  2002  and  2001,  depreciation  and  amortization  expenses  amounted to
approximately  $0  and  $97,000,  respectively.

MERCHANDISE  INVENTORIES: Merchandise inventories consisted primarily of new and
used  clothing, furniture, miscellaneous household items and antiques which were
valued  by  the  retail method and stated at the lower of cost (FIFO) or market.
The  cost  of  inventories  included  the actual cost of merchandise paid to the
respective  charities  or  the independent contract collectors plus all expenses
incurred  that  were  directly associated with the acquisition and processing of
such  inventory  including  certain  store  overhead  and  salaries.  Inventory
write-downs  were  recorded  in the period in which it became reasonably evident
that  the  merchandise  was not saleable or the market value was less than cost.

NET  LOSS  PER SHARE: Net loss per share is computed in accordance with SFAS No.
128,  "Earnings  Per  Share,"  by  dividing  the  net  loss  allocable to common
stockholders  by  the  weighted  average  number  of  shares  of  common  stock
outstanding.

During  each  year  presented,  the  Company  has  certain  options,  warrants,
convertible  preferred stock and/or mandatorily redeemable convertible preferred
stock, which have not been used in the calculation of diluted net loss per share
allocable  to  common  stockholders  because  to  do  so would be anti-dilutive.

COMPREHENSIVE  INCOME:  The  Company  has  no  components of other comprehensive
income.  Accordingly,  comprehensive  net  loss  equals net loss for all periods
presented.

FAIR VALUE DISCLOSURES: The carrying value of cash, prepaid expenses and accrued
expenses  are  a  reasonable  estimate  of  their  fair  value.

INCOME  TAXES: Deferred income tax assets and liabilities are computed for those
differences  that  have  future tax consequences using the currently enacted tax
laws  and  rates  that apply to the periods in which they are expected to affect
taxable  income.  Valuation  allowances are established, if necessary, to reduce
the deferred tax asset to the amount that will more likely than not be realized.
Income  tax expense is the current tax payable or refundable for the period plus
or  minus  the  net  change  in  the  deferred  tax  assets  and  liabilities.

                                      F-8
<PAGE>

CASH  AND  CASH EQUIVALENTS: The Company considers all highly liquid investments
with  an  original  maturity  of  three  months  or less to be cash equivalents.

ADVERTISING  COSTS:  The  Company  expenses  all  advertising  costs as they are
incurred. Total advertising costs for fiscal 2002 and 2001 were approximately $0
and  $16,200,  respectively.

USE  OF  ACCOUNTING  ESTIMATES:  The  preparation  of  financial  statements, in
conformity with accounting principles generally accepted in the United States of
America,  requires  management to make estimates and assumptions that affect the
amounts  reported  in  the  financial  statements  and  accompanying  notes.
Accordingly,  actual  results  could  differ  from  those  estimates.

NEW ACCOUNTING PRONOUNCEMENTS: In April 2002, the FASB issued Statement No. 145,
"Rescission  of  FASB  Statements No. 4, 44, and 64, Amendment of FASB Statement
No.  13,  and Technical Corrections." FASB Statement No. 145 updates, clarifies,
and  simplifies  existing  accounting  pronouncements.  The  adoption  of  FASB
Statement  No.  145  has  not  had  a material impact on the Company's financial
statements.

In  June  2002,  the  FASB  issued  Statement  No.  146,  "Accounting  for Costs
Associated  with  Exit  or  Disposal Activities" which supercedes EITF No. 94-3,
"Liability Recognition for Certain Employee Termination Benefits and Other Costs
to Exit an Activity (including Certain Costs Incurred in a Restructuring)." FASB
Statement No. 146 requires that a liability for costs associated with an exit or
disposal  activity be recognized when the liability is incurred rather than when
a  company  commits  to  such an activity and also establishes fair value as the
objective  for initial measurement of the liability. The Company will adopt FASB
No.  146  for  exit or disposal activities that are initiated after December 31,
2002.  This  Statement  is  not  expected  to  have  an  impact on the Company's
financial  condition  or  results  of  operations.

In December 2002, the FASB issued Statement No. 148, "Accounting for Stock Based
Compensation-Transition  and  Disclosure."  FASB  Statement  No. 148 amends FASB
Statement 123, "Accounting for Stock-Based Compensation," to provide alternative
methods  of  transition for a voluntary change to the fair value based method of
accounting  for  stock-based  employee compensation. In addition, FASB Statement
No.  148 amends the disclosure requirements of FASB Statement No. 123 to require
prominent  disclosures in both annual and interim financial statements about the
method of accounting for stock-based employee compensation and the effect of the
method  used  on  reported  results.  The Company adopted FASB Statement No. 148
effective  December 1, 2002 and has provided the disclosures required under FASB
Statement  No.  148  as  follows:

     The  fair value of options granted was estimated at the date of grant using
     the  Black-Scholes  Valuation  Method  with the following assumptions; risk
     free  interest  rate  of approximately 8% and 7 % for fiscal 2002 and 2001,
     respectively,  no  expected  dividends, weighted average expected life of 5
     years  for fiscal 2002 and fiscal 2001, and volatility ranging from .28% to
     .38%  and  .09%  to  .38%  for  fiscal  2002  and  2001,  respectively.

     The  Company  applies  APB No. 25 and related interpretations in accounting
     for  stock  options  granted  to  employees.  Had  compensation  cost  been
     recognized  consistent  with SFAS No. 123, the Company's net loss, net loss
     attributable  to  common  shareholders,  net loss per common share, and net
     loss  attributable to common shareholders per share would have been reduced
     to  the  pro  forma  amounts  indicated  below.

                                      F-9
<PAGE>

<TABLE>
<CAPTION>

<S>                                                    <C>           <C>


                                                               Fiscal
                                                          2002           2001
                                                       ------------------------
Net loss, as reported                                  $(623,525)   $ (101,244)
Pro-forma net loss                                     $(624,337)   $ (129,401)
Pro-forma net loss per common share
   (basic and diluted)                                 $   (1.96)   $    (0.43)

</TABLE>


NOTE  4  -  SALE  OF  BUSINESS  UNITS

During  fiscal  2001,  the  Company's stockholders approved (with all the shares
held  by  the President and his affiliates voting with the majority of all other
outstanding  shares) the sale of substantially all of the net assets used by the
Company  in  the  conduct  of  its  retail  thrift store and charitable donation
collection  business  and  its web-site in development (the "Business Units") to
Thrift  Ventures  Inc.  ("Thrift Ventures"), a newly formed corporation owned by
Marc Douglas, the Company's former principal stockholder, former Chairman of the
Board,  former Chief Executive Officer and former President. On August 27, 2001,
the  Company  closed  the  sale  of  the  Business  Units to Thrift Ventures. As
consideration  for the purchase of these Business Units, Thrift Ventures paid to
the  Company  $1,175,000  in  the  form  of  a  three-year  promissory note (the
"Purchase  Note")  bearing interest at the rate of 8.0% per annum. The principal
amount  of  the  note  is  payable  in  installments  beginning  on  the  second
anniversary  date  of  the  note.  Accrued  interest  is  payable  in  quarterly
installments  beginning  on  the first anniversary date of the note. The note is
secured  by  a  security  interest in the Business Units sold. The excess of the
purchase  price  of  the Business Units over the carrying value of such Business
Units  amounted to $385,589 and has been accounted for as a capital contribution
in  the  accompanying  balance sheet and statement of stockholders' deficit (see
Note  6).


NOTE  5  -  INCOME  TAXES

The  provision  for  income  taxes  includes  the  following  components:

<TABLE>
<CAPTION>

<S>                                                        <C>                 <C>


                                                                       FISCAL
                                                           ------------------------------
                                                                2002               2001
                                                           -----------        -----------
Current:
   Federal                                                 $        --        $        --
   State                                                            --                 --
                                                           -----------        -----------
                                                                                       --
Deferred:
   Federal                                                          --             80,000
   State                                                            --              9,000
                                                           -----------        -----------
                                                                    --             89,000
                                                           -----------        -----------
Total provision                                            $        --        $    89,000
                                                           ===========        ===========


Deferred tax (assets) liabilities are comprised of the following:

                                      F-10
<PAGE>

                                                                       FISCAL
                                                           ------------------------------
                                                                2002              2001
                                                           -----------        -----------

Federal net operating loss carryforward                    $  (128,000)       $   (83,000)

State net operating loss carryforward                          (21,000)           (14,000)
                                                           -----------        ------------

Net deferred tax asset                                        (149,000)           (97,000)
                                                           -----------        -----------

Valuation allowance                                            149,000             97,000
                                                           -----------        -----------

Net deferred tax asset                                     $        --        $        --
                                                           ===========        ===========



   A reconciliation of income tax computed at the Company's statutory rate to
       income tax computed at the Company's effective rate is as follows:



                                                                       FISCAL
                                                           ------------------------------
                                                               2002               2001
                                                           -----------        -----------

U.S. federal income tax (benefit)
    computed at statutory rate                             $   (42,000)       $    (4,000)

State income tax (benefit), net of federal
    income tax (benefit)                                        (7,000)            (1,000)

Other                                                           (3,000)            19,000

Valuation allowance                                             52,000             75,000
                                                           -----------        -----------
                                                           $        --        $    89,000
                                                           ===========        ===========

</TABLE>

                                      F-11
<PAGE>

The  Company  has  a  net operating loss carryforward of approximately $394,000,
which  expires  at  various  dates  through  2022  to offset taxable income. The
Company  has placed a valuation allowance against its deferred tax assets due to
the  uncertainty  surrounding  the  realization  of  such  assets.  Management
periodically  evaluates  the  recoverability  of the deferred tax assets and the
level  of valuation allowance. On August 27, 2001, approximately $750,000 of the
recorded  valuation  allowance  was transferred to Thrift Ventures in connection
with the sale of the Business Units. Additionally, an adjustment was recorded in
the  fourth  quarter of the fiscal year ending in 2001, increasing the allowance
by  $95,000.  At  such  time as it is determined that it is more likely than not
that  these  deferred tax assets are realizable, the valuation allowance will be
reduced.

Subsequent  to  December  29,  2002,  certain  equity transactions resulted in a
change in control for federal income tax purposes, which limits the annual usage
of  the  Company's  net operating loss carryforward.  These limitations have not
been  calculated  as  of  May  23,  2003.


                                      F-12
<PAGE>
NOTE  6  --  STOCKHOLDERS'  DEFICIT

SERIES  A  PREFERRED  STOCK:  The  holder  of  the  Company's preferred stock is
entitled  to vote with the holders of the common stock on all matters, except as
required by law, with each share of preferred stock currently outstanding having
10  votes.  The  preferred  stock has a liquidation preference of $.10 per share
over the common stock. The preferred stock does not provide for the payment of a
stated  rate  of  dividends,  is  not  convertible  into common stock and is not
mandatorily  redeemable  by  the  Company.

STOCK  GRANTED  AS  PART  OF  DEBENTURE  SETTLEMENT:  In March 2000, the Company
completed  a  private  placement  of a 7% convertible debenture with a principal
amount  of $1,000,000 (the "Debenture"). In January 2001, a lawsuit was filed in
the  United  States  District  Court, Southern District of New York, against the
Company  and  other unnamed individuals. The plaintiffs, as alleged assignees of
the  original  purchaser  of  the  Debenture, alleged that the Company failed to
register  the  shares  of the Company's common stock issuable upon conversion of
the  Debenture  and  failed  to  pay  penalties due as a result of such failure.

On  March  16,  2001,  the  Company  entered  into  a settlement agreement which
provides  for  the  dismissal of the lawsuit, without prejudice, in exchange for
the  payment  by  the Company of $200,000 cash, the issuance of 20,000 shares of
common  stock valued at $32,000 (the fair market value as of March 16, 2001) and
the  delivery  of  a  three-year  10% promissory note in the principal amount of
$300,000  secured  by  a  security  interest  in  the  Company's  inventory  and
guaranteed  by  the  Company's  President.  As  a  result of the settlement, the
debenture  was deemed paid in full and satisfied. In connection with the sale of
the Business Units, Thrift Ventures assumed the obligation to pay the promissory
note.

In  consideration for personally guaranteeing the promissory note, the Company's
Board  of  Directors granted the President five-year warrants to purchase 50,000
shares  of  the  Company's  common stock at an exercise price of $.625 per share
(the  fair  market  value  of  the  common  stock  as  of  March  16,  2001).

All remaining capitalized expenses related to the Debenture not amortized (which
totaled  $130,410) were included in the calculation of the gain on the debenture
settlement.  The  gain  on  the  debenture  settlement  amounted  to  $408,552.

STOCK  GRANTED  TO  MARC DOUGLAS:  In May 2002, Thrift Ventures agreed to prepay
the  initial  interest  payment  of  $98,926  on the Purchase Note in four equal
monthly  installments  beginning  on May 31, 2002 and ending on August 27, 2002,
the original due date of the initial interest payment. Thrift Ventures agreed to
this  prepayment in order to provide the Company with additional working capital
with  which  to  pay  its  ongoing  expenses  from  the Company's public company
reporting requirements and other related corporate expenses. In consideration of
his  agreement  to make the prepayment, the Company's Board of Directors granted
to  Marc Douglas ("Douglas"), the controlling stockholder of Thrift Ventures and
the  Company's  former  principal  shareholder,  41,667  shares of the Company's
Common Stock, which had a fair value as of the date of grant (March 15, 2002) of
$.60  per  share.

MARC  DOUGLAS  STOCK  SALE:  On  October  28,  2002, the Company's then-majority
stockholder,  Marc  Douglas, entered into a Stock Purchase Agreement pursuant to
which  Douglas  agreed  to  sell,  through a series of transactions, all 250,000
shares  of  the Company's Series A Preferred Stock (the "Preferred Stock") owned
by him in exchange for a promissory note in the principal amount of $150,000 due
120 days from the closing.  The Preferred Stock sold by Douglas represented 100%
of  the  outstanding  Preferred  Stock.  In  connection  with  the  sale  of his
Preferred  Stock,  Douglas  cancelled  156,717 shares of Common Stock and 60,500
options  and warrants to acquire the Company's common stock owned by Douglas and
his  affiliates.  The  Company's  Board of Directors assigned to Douglas and his
affiliates  $675,000  of  the  outstanding  principal  balance of the $1,175,000
Purchase  Note  payable  to  the Company by an entity controlled by Douglas.  In
connection  with  this  transaction,  the  Company  entered  into  a  five-year
consulting  agreement with Douglas whereby he agreed to provide the Company with
advice  regarding  strategies  for  development  and  expansion of the Company's
business,  including with respect to mergers and acquisitions for the consulting
agreement.  The  closing  for  the  sale took place upon the satisfaction of all
closing  conditions  on  December  18, 2002.   On December 29, 2002, the Company
wrote  off  the  remaining $500,000 balance of the note receivable from Douglas.
This  balance  was  written  off  based  on  management's decision not to engage
Douglas  for  any  consulting  services  on  behalf of the Company subsequent to
December  29,  2002.

                                      F-13
<PAGE>

In  conjunction  with the sale of Douglas Preferred Stock, the then-current
directors  of  the  Company  resigned  from  the  Board and William Michael
Sessions  ("Sessions")  and John W. Meyers ("Meyers") were appointed to the
Board.  In  addition,  Sessions was appointed to serve as the Company's CEO
and  Secretary  and  Meyers was appointed to serve as the Company's COO and
Treasurer.

1996  STOCK  OPTION  PLAN:  The  Company  has adopted the 1996 Stock Option Plan
("1996  Plan")  under  which  options  to acquire up to 100,000 shares of Common
Stock may be granted.  In 2000, the 1996 Plan was amended to increase the number
of options that may be granted to 220,000. The 1996 Plan is designed to serve as
an  incentive  for  retaining  qualified  and  competent  employees,  directors,
consultants  and  independent contractors of the Company. The 1996 Plan provides
for  the  granting of both "incentive stock options " (as defined in Section 422
of  the  Code)  and  non-statutory  stock  options.

The  following  summarizes  the  activity  in  the  1996  Plan:

<TABLE>
<CAPTION>



<S>                                         <C>                 <C>                  <C>            <C>

                                                       Fiscal 2002                           Fiscal 2001
                                           ------------------------------------    ---------------------------------
                                                                  Average                              Average
                                               Shares          Exercise Price        Shares         Exercise Price
                                           ---------------    -----------------    ------------    -----------------
Stock options                                    86,408             $16.80             70,513            $28.10
Options granted                                   3,000             $ 5.00             19,600            $ 1.20
Options exercised                                    --                --                  --              --
Options cancelled                              (18,375)             $15.60             (3,705)           $35.60
Options at end of year                           71,033             $16.50             86,408            $16.80
At end of year:
Shares exercisable                               69,533             $16.80             67,008            $21.40
Weighted-average fair value of
    options granted during the year               3,000             $ 0.53                 --            $ 1.10


</TABLE>



The  Company  has  engaged  outside  legal counsel to review the Company's stock
option  plan  and determine the legal status of all outstanding stock options as
of  December  29,  2002.  Management  and the Company will honor all outstanding
stock  options  presented  for  exercise  pending  completion  of  this  review.
Accordingly,  no actions will be taken by the Board of Directors with respect to
outstanding  stock  options  as  of December 29, 2002 until this review has been
completed.


NOTE  7  --  RELATED  PARTY  TRANSACTIONS

During  fiscal  2001,  the  Company's stockholders approved (with all the shares
held  by  the President and his affiliates voting with the majority of all other
outstanding shares) the sale of the Company's Business Units to Thrift Ventures,
a  newly  formed  corporation  owned  by  Douglas,  the  Company's  principal
stockholder,  chairman  of  the board, Chief Executive Officer and President. On
August  27,  2001,  the  Company closed the sale of the Business Units to Thrift
Ventures.  See  Note  4.

During  2002, the Board of Directors agreed to begin reimbursing Thrift Ventures
for  certain services that had been provided to the Company on a cost-free basis
since the closing of the sale of the business units. These services have to date
included:  (a)  office  space  and  all  related  amenities  such as telephones,
copiers,  facsimile  machines  and office supplies; (b) all necessary accounting
and bookkeeping services related to the Company's public reporting requirements;
(c)  other  administrative  services,  such  as  receptionist  and  bill-paying
services;  and  (d)  the  assistance  of  Douglas  in  identifying  a  possible
acquisition  candidate  for  the  Company,  as  well as negotiating a definitive
agreement  and  completing  a transaction with such an acquisition candidate. In
exchange for Thrift Ventures' and Douglas' agreement to continue providing these
services  to  the  Company,  the  Company  reimbursed Thrift Ventures $5,000 per
month.  During 2002, $25,000 in reimbursements for these services to the Company
were  offset  against  interest amounts due to the Company from Thrift Ventures.

                                      F-14
<PAGE>

NOTE  8  -  COMMITMENTS AND CONTINGENCIES

The Company is from time to time involved in various pending or threatened legal
actions.  The litigation process is inherently uncertain and it is possible that
the  resolution  of  such  matters might have a material adverse effect upon the
financial  condition  of  the Company.  However, in the opinion of the Company's
management,  matters currently pending or threatened against the Company are not
expected  to  have  a  material  adverse effect on the financial position of the
Company.

The  Company  has recently become aware that some of the payments due to Douglas
under  the Stock Purchase Agreement dated October 28, 2002 have not been made by
the  parties'  responsible for those payments.  Even though the Company is not a
party to that Stock Purchase Agreement, and the Company has no obligations under
the  agreement,  if Douglas brought a legal action to rescind the Stock Purchase
Agreement  and  prevailed, then Douglas could potentially re-acquire the 156,717
shares  of  common  stock  he cancelled and re-acquire the 250,000 shares of the
Company's  Series  A  Preferred  Stock, which could result in a change of voting
control  of  the  Company.

NOTE  9  -  SUBSEQUENT  EVENTS

On  January  31,  2003,  the  Company  acquired 100% of the outstanding stock of
Kina'ole  Development Corporation, a Hawaii corporation.  Kina'ole is located in
Lihue,  Hawaii,  and  through  arrangements  with  dealerships  on each Hawaiian
island,  Kina'ole  plans  to  sell  manufactured homes to retail customers.  The
Company acquired the Kina'ole shares from Sessions and Meyers, both of whom were
officers  and  directors  of  the  Company  at  the time of the transaction.  In
exchange  for  Kina'ole's  shares,  the  Company issued Sessions and Meyers each
250,000  shares  of  the  Company's  Series  B  Convertible  Preferred  Stock.

The  Company's  Series  B  Convertible  Preferred  Stock  has  no voting rights.
Additionally,  if at any time at least 5% of Kina'ole's outstanding common stock
is  distributed  to  the  Company's  stockholders  on a pro rata basis, then the
Series  B  Convertible  Preferred  Stock  shall  automatically convert into that
number  of  shares  of  common  stock  of  Kina'ole  equal  to  90%  of the then
outstanding  common  stock  of Kina'ole (after giving effect to the distribution
described  above  and  this  conversion).

On  February  21, 2003, the Company entered into a Stock Purchase Agreement with
its  then-current  directors, Sessions and Meyers, and Mr. Scott Siegel, whereby
the Company agreed to issue 1,050,000 shares of common stock (1,000,000 has been
issued  to  date)  to  Mr.  Siegel,  and Sessions and Meyers transferred 250,000
shares of Series A Preferred Stock to Mr. Siegel, all in exchange for Mr. Siegel
agreeing  to  pay  approximately  $72,500 in outstanding Company liabilities and
$150,000 for outstanding amounts owed by Sessions and Meyers to Marc Douglas. On
March  5, 2003, Sessions and Meyers resigned as directors of the Company and Mr.
Siegel,  who  was  not  a  related  party  to  the  Company  at  the time of the
transaction,  became  an  officer  and director of the Company on March 5, 2003.

Subsequent  to  year  end,  250,000  shares  of  common  stock  were issued to a
consultant  for  services  performed  pursuant to a verbal consulting agreement.

                                      F-15
<PAGE>