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AGREEMENT AND PLAN OF MERGER OF FESTIVE WORLD LLC (A New York Limited Liability Company) and CASTLE & XXXXXX HOLDINGS, INC. (A Delaware Corporation) AGREEMENT AND PLAN OF MERGER, dated as of December __, 2003, by and between Festive World LLC, a New York Limited Liability Company (hereinafter may be known as "Festive World"), and Castle and Xxxxxx Holdings, Inc., a Delaware corporation (hereinafter known as "Castle & Xxxxxx" or the "Surviving Corporation"). W I T N E S S E T H Festive World is a Limited Liability Company duly organized and existing under the laws of the State of New York. Castle & Xxxxxx, is a corporation duly organized and existing under the laws of the State of Delaware on June 12, 2003 under the name FestiveWorld Corp. The authorized number of units of Festive World is 20,000 Common Units. The authorized number of shares of Surviving Corporation is Twenty Six (26,000,000) Million shares of which Twenty Five (25,000,000) Million shares shall be Common Stock, $.0001 par value per share and One (1,000,000) Million shares shall be Preferred Shares, $.0001 par value per share. The Boards of Directors of Festive World and the Surviving Corporation deem it advisable for the mutual benefit of Festive World, the Surviving Corporation, and their respective shareholders or unit holders, that Festive World be merged with and into the Surviving Corporation and have approved this Agreement and Plan of Merger (the "Agreement"). NOW, THEREFORE, in consideration of the premises and of the mutual covenants, agreements and provisions hereinafter contained, the parties hereto agree that, in accordance with the applicable laws of the States of New York and Delaware, Festive World shall be, at the Effective Date of the Merger (as hereinafter defined), merged with and into the Surviving Corporation, which shall be the surviving corporation, and that the terms and conditions of such merger and the mode of carrying it into effect shall be as follows: ARTICLE I Merger 1.1 On the Effective Date of the Merger, Festive World shall be merged with and into Surviving Corporation. The separate existence of Festive World shall cease and the Surviving Corporation shall continue in existence and, without other transfer, succeed to and posses all the properties, rights, privileges, immunities, powers, purposes and franchises, of a public, as well as of a private nature, and shall be subject to all of the obligations, liabilities, restrictions, disabilities and duties of Festive World and Surviving Corporation, all without further act or deed, as provided in Section 259 of the Delaware General Corporation Law. 1.2 All rights of creditors and all liens upon the property of either Festive World or Surviving Corporation shall be preserved unimpaired by the Merger, and all debts, liabilities, obligations and duties, including, but not limited to, the obligations of Festive World pursuant to any existing guarantees, leases, stock options or other contracts or agreements, of either Festive World or the Surviving Corporation shall, on the Effective Date of the Merger, become the responsibility and liability of Surviving Corporation, and may be enforced against it to the same extent as if said debts, liabilities, obligations and duties had been incurred or contracted by it. All corporate acts, plans (including but not limited to stock option plans), policies, arrangements, approvals and authorizations of Festive World, its unit holders, board of directors, officers and agents, which were valid and effective immediately prior to the Effective Date of the Merger, shall be taken for all purposes as the acts, plans, policies, arrangements, approvals and authorizations of the Surviving Corporation and shall be as effective and binding thereon as the same were with respect to Festive World. 1.3 Prior to the Effective Date of the Merger, Festive World and Surviving Corporation shall take all such action as shall be necessary or appropriate in order to effectuate the Merger. In case at any time after the Effective Date of the Merger Surviving Corporation shall determine that any further conveyance, assignment or other documents or any further actions necessary or desirable to vest in or confirm to Surviving Corporation full title to all the properties, assets, rights, privileges and franchises of Festive World, the officers and directors of Festive World, at the expense of Surviving Corporation, shall execute and deliver all such instruments and take all such action as Surviving Corporation may determine to be necessary or desirable in order to vest in and confirm to Surviving Corporation title to and possession of all such properties, assets, rights, privileges and franchises, and otherwise to carry out the purposes of this Agreement. -2- ARTICLE II Terms and Conditions of the Merger The terms and conditions of the Merger, including the manner and basis of converting the common units of Festive World into shares of capital stock of Surviving Corporation shall be as follows: 2.1 Certificate of Incorporation. From and after the Effective Date of the Merger and until thereafter amended as provided by law, the Certificate of Incorporation of Surviving Corporation in effect on the date hereof, as set forth in Exhibit B shall be the Certificate of Incorporation of Surviving Corporation. 2.2 By-Laws. The By-laws of Festive World and/or the Surviving Corporation, as the case may be, in effect on the Effective Date of the Merger shall continue in force and be the By-laws of the Surviving Corporation until altered, amended or repealed. 2.3 Directors and Officers. The directors and officers of Festive World in office on the Effective Date of the Merger shall continue in office as, and be and constitute, the directors and officers of Surviving Corporation, each to hold office as provided by the By-laws until his successor shall have been elected and shall have qualified or until his earlier death, resignation or removal. 2.4 Conversion of Outstanding Shares, Common Units, Rights and Options. The manner and basis of converting the common units, shares, rights and options to purchase shares of Festive World into shares, rights and options to purchase shares of the Surviving Corporation, and the cancellation and retirement of shares of Surviving Corporation, shall be as follows: 2.4.1 Each common unit of Festive World issued and outstanding, or held in the treasury of Festive World, on the Effective Date of the Merger shall forthwith and without the surrender of stock certificates or any other action, be converted into 3,527,801 fully paid and non-assessable shares of Common Stock, par value $ .0001 per share, of Surviving Corporation, issued and outstanding or held in the treasury of Surviving Corporation, as the case may be. 2.4.2 No options or rights to purchase common units of Festive World are currently outstanding. 2.5 Dividends. The holders of common units of Festive World shall be entitled to receive from Surviving Corporation (i) those dividends, if any, which were declared by the Board of Directors of Festive World prior to, but not yet paid, as of the Effective Date of the Merger and (ii) those dividends which may be declared by the Board of Directors of Surviving Corporation subsequent to the Effective Date of the Merger pursuant to the Certificate of Incorporation of Surviving Corporation, and no holder of common units of Festive World shall be entitled to any other dividends which might otherwise accrue on or prior to the Effective Date of the Merger. -3- ARTICLE III Procedures Regarding Stock Certificates From and after the Effective Date, each outstanding stock certificate theretofore representing common units of Festive World shall represent 1 share of Common Stock of the Surviving Corporation. Each holder of a certificate or certificates theretofore representing common units of Festive World may, but shall not be required to, surrender the same to Surviving Corporation for cancellation and exchange or transfer, and such holder or his transferee shall be entitled to receive certificates representing 1 share of the Common Stock of Surviving Corporation for each common unit of Festive World represented by the certificates surrendered. Until so surrendered for cancellation and exchange or transfer each outstanding certificate which, prior to the Effective Time, represented common units of Festive World, shall be deemed and treated for all purposes to represent the ownership of 1 share of the Common Stock of Surviving Corporation as though such surrender had taken place. ARTICLE IV Effective Date This Agreement shall be submitted to the stockholder of Surviving Corporation and the unit holders of Festive World at meetings which shall be convened on or prior to December __, 2003, or such other dates as may be agreed on by the parties, as provided by the applicable laws of the States of New York and Delaware. If this Agreement is duly authorized and adopted by the requisite votes of the holder of Common Stock of Surviving Corporation and holders of common units of Festive World and this Agreement is not terminated pursuant to the provisions of Article V hereof, then a certificate of merger shall be filed in accordance with the laws of the State of Delaware and a certificate of merger shall be filed in accordance with the laws of the State of New York. The Merger shall become effective upon the filing of the certificates of merger with the Secretaries of State of the States of New York and Delaware (the "Effective Date of the Merger"). ARTICLE V Approval of Shareholders and Unit Holders - Termination 5.1 This Agreement shall be submitted to the unit holders of Festive World and the stockholders of Surviving Corporation as provided by law, and it shall take effect and be deemed and be taken to be the Agreement and Plan of Merger of Festive World and Surviving Corporation upon the approval or adoption thereof by the unit holders of Festive World and the stockholder of Surviving Corporation, in accordance with the requirements of the laws of the State of New York and the State of Delaware, and upon the execution, filing and recording of such documents and the doing of such other acts and things as shall be required for accomplishing the merger under the provisions of the applicable statutes of the State of New York and of the State of Delaware. -4- 5.2 At any time prior to the filing of the certificates of merger with the Secretary of State of the States of Delaware and New York, this Agreement may be terminated by the board of directors of either Festive World or Surviving Corporation, notwithstanding the approval of this Agreement by either or both of the unit holders of Festive World and the stockholders of Surviving Corporation, if for any reason the board of directors of Festive World or Surviving Corporation determines that it is inadvisable to proceed with the Merger, including, without limitation, giving consideration to the number of shares for which appraisal rights have been exercised and the cost to Festive World thereof. 5.3 In the event of the termination and abandonment of this Agreement pursuant to the provisions of Section 5.2, this Agreement shall become null and void and have no effect, without any liability on the part of either Festive World or Surviving Corporation or any of their respective unit holders, stockholders, directors or officers. ARTICLE VI Certain Agreements of Surviving Corporation 6.1 Surviving Corporation, as the surviving corporation, hereby agrees that it may be served with process in the State of New York in any proceeding for the enforcement of any liability or obligation of Festive World or of the rights of dissenting unit holders of Festive World. 6.2 Surviving Corporation, as the surviving corporation, hereby irrevocably appoints the Secretary of the State of New York as its agent to accept service of process in any action or proceeding described in Section 6.1. 6.3 Surviving Corporation, as the surviving corporation, hereby agrees that it will promptly pay to dissenting unit holders, if any, of Festive World the amount, if any, to which such dissenting unit holders shall be entitled pursuant to the laws of the State of New York. ARTICLE VII Miscellaneous 7.1 This Agreement may be executed in any number of counterparts, each of which shall be an original, but such counterparts shall together constitute but one and the same instrument. -5- 7.2 The headings of the several articles herein have been inserted for convenience of reference only and are not intended to be a part or to affect the meaning or interpretation of this Agreement. IN WITNESS WHEREOF, each of Festive World and Surviving Corporation, pursuant to authority duly given by resolutions adopted by its Board of Directors has caused these presents to be executed in its name by its President or a Vice-President and its corporate seal to be affixed and attested by its Secretary and Treasurer. FESTIVE WORLD LLC. (New York Limited Liability Company) Attest: /s/ Xxxxxxxxxxx Xxxx By:______________________________ Xxxxxxxxxxx Xxxx, President CASTLE & XXXXXX HOLDINGS, INC. (Delaware Corporation) (Corporate Seal) Attest: /s/ Xxxxxxxxxxx Xxxx By:______________________________ Xxxxxxxxxxx Xxxx, President