The Mandarin and his prisoner Tony Stark converse in his castle about the Mandarin's construction of the giant android called Ultimo.
Iron Man Story -"Ultimo Lives!"
Tony Stark has been kidnapped by the Mandarin, since he's about to unleash something he calls Ultimo onto the world, and couldn't find Iron Man to see him take over the world. Unfortunately, when he was captured the Mandarin threw Tony's briefcase into his castle moat, thinking that it could contain an explosive, when it actually contains the Iron Man Armour. Tony decides to stall for time, and asks the Mandarin what Ultimo is. Mandarin explains that Ultimo is a gigantic android, which he built in an extinct volcano. He then has a flashback to when he finally finished creating Ultimo, how when turned on the switch to activate Ultimo, Ultimo absorbed more energy than he was expected to, making him more powerful than he had thought. The Mandarin then says to Tony that he'll reign supreme from this day on.
The Mandarin then turns to his control panel, where he sees some Chinese soldiers about to attack his castle, since he refuses to serve them. Whilst his attention is on the screen, Tony starts backing up in the hope that he can escape and reach his armour, but the Mandarin notices straight away. He then blasts Tony with one of his rings, knocking him down some stairs, and assumes that Tony is killed by the fall. However, the chestplate of the Iron Man armour manages to save Tony, by acting as a shock-proof vest. Tony then hears giant footsteps, and runs and dives into the moat, looking for his briefcase.
Meanwhile, the Chinese soldiers which Mandarin saw on his screen have arrived and are ready to attack his castle, but before they can, they encounter Ultimo, who has emerged from the volcano where he was built. Despite the best efforts of the Chinese, their guns do nothing against Ultimo, who then starts shooting lasers from his eyes at them. Iron Man then appears, but when he sees Ultimo's sheer size and the power of his laser beams, he wonders how he can defeat something so powerful. Unknown to Iron Man, back in America Senator Byrd is shutting down Tony Stark's factory, as he's ordered him to come before Congress, but hasn't arrived.
Captain America Story- "If a Hostage should Die!"
At the start of this issue, Steve Rogers is watching a documentary about Captain America in his World War II days. The documentary shows Captain America distraught and panicky, and the commentator wonders why Captain America was acting like that on the day that the Allies managed to wrest the Nazi's control of Paris. Steve says to himself that whilst it was a day of victory for everyone else, it was the day of one of the most tragic losses in his life. He then thinks back to World War II, when he was with a woman who loved him, and fought beside him from time to time. Unfortunately, Captain America's duty called, and whilst he was away, the unknown woman was kidnapped by the Nazis, and taken with some other prisoners to be executed.
Moments before they were due to be shot, the Allies managed to arrive in Paris to stop the Nazis. However, when Captain America came to the prison where his girlfriend had been captured, he found out that she had been taken by the Gestapo. Unfortunately, whilst Captain America wanted to look for her, everyone else was celebrating, and this was captured on camera, explaining the documentary at the start.