This issue features two stories told in parallel columns; for convenience's sake I’ll cover the Cap half then the USAgent part.
Captain America enters a barn in New Jersey, investigating the mystery of the rampaging machines from issue #351; this place is the last lab of the villain Machinesmith. Cap finds no sign of occupancy but recovers the villain’s robot head and returns to base. He meets with Fabian Stankowicz and offers him a position as Avengers inventor.
Cap is summoned to examine a robot discovered in Massachusetts; it is the long-lost Fourth Sleeper. Cap arranges to take the thing back to Avengers Island for safekeeping….
Cap arrives at the Island lab and Fabian is surprised to see some old enemies in stasis—various robots and androids that fought the Avengers. The Sleeper, only feigning inactivation, suddenly comes to life and attacks Cap. During the battle, Machinesmith’s head reactivates and mocks Cap, gloating over this latest trap. The monster is formidable but Cap with his shield and acrobatic ability manages to defeat it. But many questions are still unanswered….
Battle Star enters a morgue in Washington, investigating the mystery of John Walker’s death from issue #351; this place contains the body of the Watchdog assassin. Lemar finds the killer’s costume is a fake and takes it with him as he returns to base. He contacts Valerie Cooper of the Commission on Superhuman Activities and shares his suspicions.
General Haywerth is summoned to examine a suit of battle armor unveiled at Stane International; it is the long-unused Iron Monger armor. Haywerth arranges to take the thing back to the Army base for his mysterious purpose….
Commission members arrive at Fort Meade and are surprised to see a new hero—the U.S. Agent. The Iron Monger (with a human occupant) is activated and, as part of the demonstration, attacks U.S. Agent. During the battle, Haywerth explains to the Commission that the Agent is John Walker, whose death was faked to rebrand him as a martyr. Now, with extensive plastic surgery, brainwashing, and a new identity, (plus, Cap's Captain costume), he is a new hero for the country. The opponent is formidable but U.S. Agent with his shield and acrobatic ability manages to defeat him. But many questions are still unanswered….