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Jeremy tells Nick all about Jimmy Koenig, the former Pack enforcer that they learned (last episode) has been hired to kill them. Apparently Jimmy was BAD ASS. In fact, shortly after Nick was born, his (now dead) dad Tonio took baby Nick and tried to start a life with Nick's mom (rather than raise Nick in the Pack, which is Pack law). Tonio's dad sent Jimmy to collect Tonio and Nick, which he did, but not before forcing Tonio to kill some Mutts. Just to scare him and teach him a lesson. Dude is nuts. Also, Jimmy sort of looks like Richard Belzer.
In an abandoned warehouse - the kind that only exists in TV shows - Daniel Santos and LeBlanc (the psycho werewolf with the glasses) plot against the Pack. Amber, Zachary Cain's girlfriend, is there with them and learns Zachary is dead. She's extremely upset. It should also be noted that Santos is holding captive one Joey Stillwell - son of Pack ally Dennis Stillwell (the dude Santos had killed and whose eyes he gave Elena at the end of Episode #6).
Anyway, the Pack moves to intercept Jimmy Koenig at the same abandoned factory and a huge fight breaks out. Koenig nearly kills Jeremy, but Nick saves him - using the same technique Koenig forced Nick's dad, Tonio, to murder Mutts with all those years ago. LeBlanc joins the fray and even shoots Elena before she gets away. We should note that while hiding from Santos, and bleeding from the gunshot wound, Elena almost transformed into a wolf but stopped herself. We later learn this is a big deal that no one has done before.
Santos, furious with LeBlanc for getting involved, cages him. Amber offers to free LeBlanc if he bites her and turns her into a wolf. He does bite her, but the result is not exactly what she expected - she ends up mutating into this weird half-wolf, half-woman thing and dies. LeBlanc just smiles.
Back at Stately Stonehaven Manor, Elena's shook up by getting shot (no duh). Clay comforts her and they end up having sex. Elena feels major guilt. She gets a call from Philip's sister, Diane, reminding Elena that her photography show is opening the next day. Elena tells Jeremy she needs to return to Toronto to attend the show. Jeremy refuses to let her go alone - he's ordering Clay to accompany her as a bodyguard.
Back in Toronto, Philip remains suspicious of Elena. After all, in that wolf video, he saw Elena's clothes and telltale necklace in the woods. What was she doing there? He confronts Logan, who Elena was supposedly "running" with that night. Logan covers and says that they ended up going skinny dipping (Which is sort of weird, even to do with your "cousin"). Philip seems to buy it.
Rachel and Logan learn they are having a baby boy. Logan is freaked - not only does this mean the kid will be a werewolf, but Pack law neccessitates that he must take the baby from its mother and raise the baby with the Pack (see the Nick-Tonio flashback above). He struggles with what to do but tells no one. But someone obviously knows, because he receives an anonymous package with a rattle and the note "It's a boy!" attached. Who knows his secret?