The Battle of New York caused Humans in general to realize that "we are not alone", as the Chitauri attacked the citizens of New York City; the Avengers, super-powered beings, were necessary to quell the assault. The fact that "super beings" were necessary to do what Humanity could not do alone hit Michael Peterson hard and made him feel inadequate, especially after he lost his job and his wife left him. He was becoming financially destitute and disheartened when his son Ace wanted the "Heroes of New York" Collection that Mike could not afford.
The Centipede Project approached Peterson, promising him a better life, and made him a test subject of the Centipede Device, an amalgam of different superpower causing agents, including Extremis. Debbie was saved by Peterson when another test subject exploded from the concoction. However, Debbie was ungrateful; she wanted Peterson dead to keep S.H.I.E.L.D. from discovering the project.
S.H.I.E.L.D. had discovered the project though and sought Peterson for questioning, but the Extremis within him was slowly causing insanity.
Phil Coulson and Grant Ward arrived at Union Station, and Coulson tried to convince Michael Peterson to surrender himself. Peterson punched the door off of Skye's Van and tried to escape with Skye and Ace Peterson into the building. Skye was able to distract him by attacking a group of men and making a run for him. Ace was moved aside by his father to protect him, who easily defeated the men attacking him thanks to his strength.
Coulson found Ace and had a police officer to take him outside. Ward attacked Peterson from behind, but Peterson easily defeated the S.H.I.E.L.D. agent and followed Skye. Debbie sent an assassin disguised as a policeman to kill Peterson, and the assassin started to shoot him on sight. Coulson ordered Ward to only shoot Peterson if absolutely needed.
On the second floor balcony, Skye tried to convince Peterson that S.H.I.E.L.D. could help him, but the assassin approached for behind and shoot Peterson with a shotgun and make him fall to the ground floor of the station. May arrived and defeated the assassin before he could kill Skye. Coulson approached Peterson, with evident signs of the Extremis side effects, and they discussed the possible outcome of the situation. Peterson assured that being a good person should matter in the outcome, and Coulson reminded him of his son Ace needed him. Peterson replied that his son was another thing that had been taken from him, just like his wife, his house or his job.
Coulson was able to convince Peterson to surrender by saying he was counting on him becoming a hero just before Peterson was hit by a bullet. Jemma Simmons ran in to check on Peterson, as Ward shot him with the newly developed Night-Night Gun that Leo Fitz brought to him. Simmons smiled as a sign that their plan worked, and Peterson's explosion had been prevented without harming him.
Michael Peterson was recruited by S.H.I.E.L.D. and trained diligently to be an agent, using Captain America as a role model; Mike promised himself that the next time his son Ace saw him, Ace would view him as a hero. Ace was sent to live with his aunt Mindy Peterson and cousin Kisha. Coulson's Team went to its next assignment in Peru, not realizing that the Centipede Project, who relocated to Hong Kong to continue its work, was a part of HYDRA, the greatest enemy of S.H.I.E.L.D.