This episode introduces Gus Fring and Victor, played by Giancarlo Esposito and Jeremiah Bitsui respectively.
[1] Combo Ortega is selling drugs on a street corner outside Heisenberg's territory when he notices two rival dealers staring him down; he is then killed by a young boy working for them.
Skinny Pete, spooked by Combo's death and Badger's recent brush with the law, decides to quit the drug trade.
Jesse is distraught that he got Combo killed, and that night tells Jane Margolis to leave his apartment so that he does not harm her recovery when he smokes meth.
The next day, Walt waits at a local chicken restaurant called Los Pollos Hermanos, where the distributor has arranged to meet them; Jesse comes in late, still high, and leaves quickly afterward.
Although the distributor maintains he is unwilling to work with a drug addict, Walt assures him that Jesse can be relied on and that their product is the best.
Ted admits that he has evaded taxation on millions of dollars by under-reporting revenue to keep the company afloat and support its employees.