Nathan and Claire were hiding out in Mexico. In order to earn some money, Nathan challenged some guys to a shot contest. He eventually lost, but Claire stepped in and won the cash because her condition makes it impossible to get drunk (that sucks).
The main point of the trip, though, was father/daughter bonding. Nathan admitted, in his drunken state, that his plan had gotten way out of hand, while also telling Claire how much he regretted giving her away. By the end, these two had formed a new bond and left Mexico together, intent on fixing everything.
Peter and Angela also salvaged their relationship. They were hiding out in a church, as Angela opened up about her regrets and Peter saw that she still donated items to the church. Maybe she wasn't such a lost cause after all? After avoiding capture by Danko's men - thanks to HRG pretending as though he didn't see them - Angela finally fell asleep and dreamed up a plan: they needed to reunite with Nathan and Claire and then track down Angela's sister.
The coolest part of the episode involved Sylar and Danko. The former offered to help the latter round up all the Heroes, as Sylar appeared to have a new glint in his eye, new excitement over this purpose. Danko agreed to the partnership, as he was stuck trying to chase down a shape shifter (a dude that could take the form of anyone he came in contact with). Sylar eventually helped Danko track the shifter to a club, where things got extra cool:
The shifter took on the form of Sylar, but Danko shot and killed him. He then allowed Sylar to take his ability, though he did so without giving the guy the usual forehead scar. How come? So later in the hour, HRG could watch as this shifter was zipped up in a body bag... looking exactly like Sylar! In other words: the world now thinks Sylar is dead! It's a fact Sylar and Danko celebrated together as the episode ends. This new partnership has loads of scary potential.
Source: TV Fanatic