Karen and Lucas come clean to Keith about what they know about Dan. Dan is beside himself with laughter over the whole thing. Keith is such an emotional wreck he throws a car part threw a window at the dealership towards Dan. Lucas decides to keep living with Dan to try and find out more about what he is up to.
Nathan goes to look for Haley. Along the way he relives memories of their marriage that are really sweet. We didn't get to see much of their married life before Haley left and I liked seeing these memories. But when he shows up she doesn't want to leave and tells Nathan they may have made a mistake when they got married and he leaves without saying goodbye. And in a very sad scene we see Nathan take off his wedding ring.
Nicki is back in town and is trying to get Jenny back. Jake considers running, but doesn't want to leave Peyton.
We find out that Felix is the one who painted "dyke" on Peyton's locker (not a really big surprise) and he gets kicked out of school and sent off to military school. Brooke breaks up with him when she finds out and Anna tells him about herself which he doesn't want to hear and walks away.