Kay makes sure that Miguel is preoccupied with her and the baby so that he can't spend any time at all with Charity. Miguel wants to do the right thing and struggles with paying Kay and the baby's medical bills. Meanwhile, Jessica and Kay give Grace the cold shoulder and tell her they don't want her around. Ivy makes matters worse when she demands Grace give back the key to the Bennett house.
Julian tells Eve he loves her -- always has, always will. However, Julian knows that he must be with Rebecca to protect Eve. Touched, Eve tells Julian that she's concerned about what he's giving up for her. She admits that she loves him every bit as much as he loves her.
Gwen and Sheridan bond from their common experience of losing a child. They try to console each other, but are consumed with grief. Meanwhile, Antonio and Luis go at each other over Sheridan. Antonio accuses Luis of betraying him by stealing his wife.
Back in her old bedroom in Harmony, Whitney sheepishly admits to Eve how foolish she feels about trusting Chad. Simone arrives and blasts her sister, then shocks Eve by wishing aloud that Whitney hadn't survived the shooting. Little Ethan inadvertently creates an awkward situation for his namesake by begging Ethan to play with him and his mom. Pilar tries to forge a truce between her embattled sons but Antonio refuses to forgive and forget. A vengeful Gwen bitterly informs Sheridan that she won't rest until she's made Theresa pay for causing her baby's death. Despite his pledge to cut Theresa out of his life, Ethan can't resist spending time with her and her son as he feels the void left by Sarah's tragic demise. Fox guesses the real reason his father is wedding Rebecca. Eve nearly lets her own secret pain show as she encourages Whitney to remain true to her feelings. Luis and Antonio both vow to have Sheridan for their very own. Rebecca advises Julian to stop moping about Eve and give her a chance to make him happy instead. Eve admits to an intrigued Whitney that she loved another man before she met T.C. Sheridan tells Gwen she's still torn between the two Lopez-Fitzgerald men in her life.
Liz gets under Eve's skin when she torments her sister about being in love with Julian and never being able to have him. Meanwhile, TC is planning a surprise for his family and tells Fox he's welcome to be part of it. Rebecca sickens Julian by planning an elaborate wedding for them that will make all of Harmony sit up and take notice.
Kay reaches out to Tabitha hoping she can come up with a plan to help her get Miguel back into her life. Kay fears that Miguel and Charity will always be together. Meanwhile, Miguel and Charity are trying to tune out the rest of the world and enjoy the Christmas season. An Angel comes to life in the Bennett house.
Gwen becomes furious when she finds out that Theresa actually has her wedding ring! How could Ethan let her get her hands on that? Gwen is so upset that she tells Ethan she never wants to see him again. It's over between them. Jessica is upset about her family troubles until Reese comes back to town and lifts her spirits.
Tabitha enjoys needling Charity about Miguel's permanent bond with Kay. Sam and Ivy bump into Grace at the skating rink as she poses for a family photo with David and a beaming John. Kneeling beside the tiny casket, Gwen has a vision of her daughter at age eight and imagines a joyous Christmas with Sarah and Ethan, then pictures their happy family through the years as the girl grows to adulthood. Though Theresa eagerly assumes that Ethan is coming back to her, he abruptly sets her straight by declaring that their relationship is at an end. Miguel promises Kay he'll share the workload with her in the care of their infant daughter. Ivy warns Grace she has no intention of losing Sam ever again. Rebecca orders Julian to help carry out her plan of revenge. Kay exults when Miguel cancels plans with a disappointed Charity in order to spend more time with little Maria. Ivy renews a blackmail threat to keep Eve in line. Theresa pleads with Ethan to reconsider but he bids her farewell.
Luis is duped into believing that the baby belongs to Beth. He knows he should spend quality time with Beth and his son, but he doesn't want to leave Sheridan alone. Sheridan tells Luis that this is the right thing to do and urges him to go to Beth. Luis reluctantly agrees, but his heart isn't in it.
Eve reaches out to her friend, Sheridan and tells her she's there for her if she needs her. Meanwhile, Liz and Antonio complain to each other about how their siblings have betrayed them. Theresa and Whitney discuss their lost loves and which one of them should go after Fox. Fox admits that he's hopelessly in love with Whitney.
Charity gets through to Gwen and she softens her position on Ethan. Maybe there is a way they can reconcile what has happened in the past and have a future together. Ethan promises that Theresa is out of their lives and he'll be devoted to her. Rebecca presses Julian to press for custody of his child with Theresa. Rebecca wants to leave her with nothing.