The episode opens with Megan waking alone in her bed, getting up to find Don curled up in his daughter's empty bed. She tells her husband that whatever's bothering him, he needs to slow down. Don sighs, but is still clearly reeling from Sally walking in on his tryst with Sylvia. He pours some orange juice and takes a small vodka bottle from his jacket to mix in. Megan hurries in to find she ruined breakfast and now has to run to work, but implores Don to stay home and sleep off his hangover.
Ken Cosgrove goes on a hunting party with executives from Chevy. The executives hear their prey, quickly turning his way with shotguns aimed just over his head, and accidentally shoot Ken in the face at near point blank range.
Back at his apartment, Don is taking it easy in front of the television, when he gets a call from Betty. She informs him that Sally doesn't want to visit her father on the coming weekend, and moreover that she suddenly wants to go to boarding school. Betty is unaware what is behind their daughter's change in attitude, but Don offers to pay whatever the cost of the school may be. He asks Betty to tell Sally "that Megan... we both miss her."
Peggy, Ted and the crew in creative go over materials on the Ocean Spray account. Peggy and Ted both do impersonations of a Kennedy-esque Ocean Spray executive, giggling at each other while Mike and the rest of creative look on. They take a break and Mike is pleased to get a break from their inside jokes.
Megan returns home to see a cleaned up Don looking in much better spirits. They get a call from Harry on the west coast, excited that Sunkist is suddenly eager to move into television promotion and possibly boost their ad expenditures. Don tells him to drop the account due to his previous pledge to Ted, as it runs into conflict with his Ocean Spray effort. Sick of Don getting pulled back to work on his day off, Megan takes her husband to "Rosemary's Baby" at the cinema. They are surprised to see Ted and Peggy in attendance after the movie ends. Ted claims it is work related, that Peggy wanted "a Japanese" in their commercial for children's aspirin and had cited the ending of the film as inspiration. Don eyes them suspiciously while Megan invites them both to dinner. Both politely decline, Peggy claiming she has a date and has to run.
When they return home, Megan is disappointed to see Don head straight for the bar and pour himself a drink. Don cites the disturbing movie and says it will help him sleep, while Megan brings up Ted and Peggy at the theater. Don wants to stay out of it while Megan is excited about the possible affair. Don decides to call Harry back in California, suddenly having second thoughts about his promise to Ted.
At the office the next morning, Pete is shocked to see Ken wearing an eyepatch and the right side of his face covered in buckshot scars. Pete laughs as Ken recounts the hunting accident, but Ken is miserable on the Chevy account and sees it as a possible way to bow out. Pete tells Ken the move is career suicide, but offers to take over the account.
Ted and Cutler meet with Don and Roger to learn the news about Harry's move on a massive Sunkist deal of $8 million. Ted is upset to learn that this would mean bowing out of the Ocean Spray deal, but Cutler offers to make the call to their executives himself. Ted also sees it as a message of sorts to their other clients that the firm lacks loyalty, and will drop accounts at the sight of dollar signs. They agree that going forward there needs to be more collaboration between the newly merged partners, rather than individually pursuing their own accounts with no regard to others. As the meeting ends, Ted tells Don that he thinks Peggy should head up the Sunkist campaign given her experience on Ocean Spray.
In Pete's office, his secretary walks in on Pete polishing his hunting rifle to let him know that Cooper wants to see him. He finds Ken and Bob already waiting, giving Bob a cold reception. Roger and Cutler join them to discuss Ken dropping the Chevy account, and they recount personal horror stories with past clients. The group agrees to let Pete take over with Bob as his second, which Pete is resistant toward. Cutler states that Bob's past experience on the account will convey the message that they are not dumping Chevy and that the service will remain the same. Bob excuses himself so that the group can discuss whether he stays on more openly, but they are insistent that either Bob stays or Pete goes. Outside the meeting, Bob inquires about Pete's attitude toward him. Pete recounts Bob's apparent confession of love, which Bob disputes was merely professional and personal admiration. The two share a tense handshake, telling Pete to watch what he says to people before loudly and cheerfully congratulating him.
Betty and Sally drive to her interview with the boarding school. They argue when Betty tries to inquire about why Sally wants to attend the school, wondering if it has to do with boys at her current school. Sally finally lies and tells her mother that she knows how important her education is to her adult life and wants to take it more seriously.
Back at the office, Pete talks to Duck Phillips over the phone about providing Bob career options in order to push him out of the agency. In Bob's office, he is incensed, yelling in Spanish (presumably to Manolo) over the phone and calling Pete a son of a bitch.
Don interrupts a meeting with Joan, Peggy and Ted discussing their plans for the St. John's television spot. Much like their earlier meeting with creative, Ted and Peggy laugh while Joan is less enthused. They pitch the ad, filmed from the baby's point of view, and the allusion to "Rosemary's Baby" -- Don is impressed, but also mindful of Ted and Peggy's infatuation with one another. After the two leave, Joan reveals that the concept will double their approved budget, and that Ted hasn't brought this up to the client.
Sally and Betty are in the middle of her boarding school interview, Betty putting over her daughter's career aspirations and academic performance. The interviewer sets up an overnight stay so that Sally can learn more about the facility and attend a few classes, but seems to eye Sally warily after her mother leaves.
Pete is surprised to find his mother at the office, even moreso to learn that she is planning an vacation to Europe with Manolo after Pete forbade her from seeing him. She tells him that Manolo had let her know of Pete's shoddy treatment of Bob.
Back at the boarding school, Sally meets with two of the students, ostensibly to learn about the living situation. However, the two girls blackmail her, saying that their review is integral to her acceptance to the school and chiding her for not bringing alcohol or cigarettes to bribe them with.
Don runs into Ted on his way out of the office. St. John's called him to halt casting after Don sent over the inflated budget for the new commercial. Ted is angry at Don for going behind his back but more disappointed that he will have to give the bad news to Peggy. Don agrees to back up the deflated Ted when they meet with St. John's the next morning.
Sally seems to be getting along with the girls at the boarding school, and we learn that she called a couple of old friends (Glen Bishop and Ronnie Lowell) to bring some liquor over as he crawls through the dorm window. They share drinks while Ronnie rolls a joint.
That evening, Pete gets a call from Duck regarding the personnel file he had sent over on Bob. Duck lets on that much of the material appears to be forged, from his college transcripts to possibly even his name. He also had contacted Bob's previous employer, learning from them that he was a man-servant to one of the account executives there before he disappeared one day.
At the apartment, Don quietly drinks in front of the television, ignoring Megan when she calls him to bed. Back at the boarding school, Sally and the girls learn more about her visiting friends, laughing that one of the girls drank and smoked too much. Mandy and Glen flirt and leave the room, which opens the door for Ronnie to awkwardly come on to a less-than-forthcoming Ronnie. Sally complains to Glen that Ronnie tried to force himself on her. The two boys fight while Sally smiles at Glen coming to her defense. After Glen and Ronnie leave, Mandy sees Sally instigating a fight between the two boys as evidence that she likes to instigate drama, and Sally seems to be firmly in the good graces of the bad girls club.
The next morning, Don waits in the boardroom for Peggy, Ted and the St. John's representatives. Ted presents the case for the new commercial to the St. John's rep, who shoots down much of what he pitches and is furious about the new budget beingsprung on him out of nowhere. Don interjects, saying that Ted is hesitant to reveal the real reason behind the new direction, insinuating to everyone in the room that it has to do with Peggy and Ted's relationship before lying that it was former partner Frank Gleason's last idea before he passed away. Cutler backs Don up as Ted and Peggy both breathe sighs of relief. This seems to soften the St. John's executive, who agrees that the idea is a fitting tribute to the man who they had worked with for years, and agrees to push the budget to $25,000. Ted and Don are left alone, and Ted insists that his perceived relationship with Peggy had nothing to do with agreeing to the new commercial. Don tells him to get it together, that Ted is embarrassing himself and people in the office are talking.
Pete confronts Bob in his office about his past. Pete wonders how Bob managed to get hired with clearly falsified documents, and Bob reveals that Pete was actually integral toward getting him the job. Bob is certain that Pete's confrontation is a shakedown, as asks for a day to get his affairs in order and he will leave voluntarily. However, Pete seems more interested in keeping Bob on board, though with restrictions and significant leverage over the mystery man going forward. His final request is to get Manolo out of his mother's life once and for all, but Bob insists once again that Manolo doesn't go for women.
Betty and Sally drive back from the boarding school. Sally is once again giving her mother the silent treatment, and Betty reveals that the recruiter is hopeful that Sally will choose their school. Sally is pleased, and lights her mother a cigarette. Betty sees that her daughter wants to smoke also, and lets Sally light up as well, saying that she's sure Don has given her beer. Betty frowns when Sally responds that her father has never given her anything.
Back at the office, Peggy learns that Ted has gone home for the day after she had requested a meeting with him. She goes to confront Don over his actions. Don purports to have done what he did in order to cover for both of them, while Peggy thinks Don hates Ted because he's everything Don is not. Peggy angrily tells Don that his actions have killed everything, from the alleged affair to the ad, and calls him a monster. Don curls up on his couch in the same way he was curled up on his daughter's bed, as the episode ends in the same way it began.