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Alison undergoes successful surgery and Billy agrees to care for her when she returns home from the hospital. They both become frightened by how much they have come to care about each other. Jake and Jo observe that the necklace Billy plans to give to Alison for Christmas is more than a "friendship" present. He disagrees, but decides not to give it to her after she makes him agree to a "no presents" pact (because she is short on cash). She fears that she has hurt his feelings. She later apologizes and he gives it to her. They admit that they have become confused by their feelings. Jo and Jake try to overcome their unhappy memories of Christmas. He is excited about making a fresh start, but she remains cynical and wants to ignore the holiday. She also tries to push him away, but they end up having a hot make out session. Michael is depressed when he and Kimberly can't save a young gunshot victim, but his spirits are revived after delivering a baby for the first time. He invites her to the Christmas party, as Jane is out of town. Rhonda flies to Aspen with Terrence for the holidays. Matt makes up with his father.