Opening up Marvel’s Phase Two, the next wave of movies following the Avengers, we check in on Iron Man in the aftermath of the Battle of New York.
In the past, Tony Stark makes friends with botanist Maya, and an enemy of Aldrich Killian and his new think tank: AIM.
In the present day, Tony is dealing with his near death on the other side of an alien wormhole by going into overdrive making new Iron Man suits in his basement, losing sleep, and having panic attacks. He’s concerned about a series of attacks and threatening communications by the terrorist Mandarin, but the US government Mandarin is targeting doesn’t want Iron Man or the Avengers getting involved in what they see as a government issue. Instead they are relying on James Rhodes War Machine, now rebranded as the Iron Patriot, to fight the threat.
When Killian tries to recruit Pepper and Stark Enterprises for his new Extremis project, and is rejected, Happy decides that Killian’s associate is shady, and starts to tail him. He witnesses a shady business deal and confronts the henchman, Savin, but this literally sets off the guy he came to meet, causing a massive explosion that puts Happy in the hospital, and that the Mandarin takes credit for. Iron Man is furious that his friend was hurt and decides to call out the Mandarin himself, inviting him to visit him at his home.
Tony starts investigating the Mandarin attacks and finds a similar one that was unclaimed in Tennessee, but he’s interrupted by the arrival of Maya, asking him for help. Before he can find out why the house is attacked by the Mandarin’s helicopters and blown off the cliff into the ocean. Tony manages to use his latest prototype suit to get Pepper and Maya to safety, and recovers the suit just in time to secretly fly away before he passes out.
He wakes up in Tennessee, just outside of his destination, as the suit runs out of power. With no way back and the world assuming he is dead in the attack he sets about repairing the suit and investigating the local bombing. With some investigation and a fight against a couple of AIM’s Extremis soldiers, with some help from a local kid, he determines that the Mandarin “attacks” are coverups for Extremis experiments gone wrong. When it works the participants gain superhuman powers, regeneration, and can burn through metal. When it doesn’t the subject will violently explode. He uses the data he’s found to track the Mandarin to Florida, and with his suit still recharging goes into battle with makeshift weapons.
During his assault on the Mandarin’s compound Tony discovers that the Mandarin is actually just a front, a paid actor, and that it is really AIM itself, and specifically Killian, that is behind everything. Unfortunately he is quickly captured. Meanwhile, Pepper and Maya have been bonding after the attack, but Maya betrays her and reveals that she’s also been working for Killian, and they plan to use Pepper as leverage to get Tony to help them fix the flaws in their formula for Extremis. They also trick Iron Patriot into a trap, capturing him to steal his suit.
Maya approaches the captured Tony, pleading for his help in fixing Extremis, but Killian ups the ante by injecting it into Pepper, being held at a secret location. When Maya protests Killian shoots her and leaves to put another scheme into motion. He forces Rhody out of the Patriot suit and gives it to Savin to sneak him onto Air Force One to kidnap the President. Fortunately the Iron Man suit is finally fully charged, and flies into action, coming to join Tony and bust him out. He and Rhodes contact the Vice President to warn him, but they get no help, and rush off to try to save the President, but they are too late. Tony manages to rescue the other people from the plane before it blows, but loses his suit again in the process.
They manage to track Killian to a moored oil tanker, where he is planning to have “the Mandarin” kill the President, putting the Vice President into office. With the VP and the Mandarin in his pocket he’ll control the war on terror from behind the scenes. Fortunately repairs on the house have finally uncovered access to the basement, so Tony calls in an army of Iron Man suits to help him and Rhody take on Killian and the Extremis soldiers. Rhody manages to save the President and recover his suit to get him to safety while Tony repeatedly tries to take out a very durable Killian. Killian finally falls when Pepper, loaded with Extremis herself, manages to blow him up. Relieved that Pepper has managed to survive, Tony decides to start over and blows up all of his suits, manages to remove the Extremis from Pepper’s system, and decides to finally get the shrapnel removed from his chest.
TLDR: Tony Stark, shaken after the Battle of New York, finds new purpose in fighting the terrorist Mandarin, but it’s only a cover for mistakes in the experimental Extremis superhuman program by AIM. Tony stops AIM’s founder, Killian, from killing the president.