At the prince's bachelor pad in London, Falstaff asks Hal what time of day it is. Hal tells his boy that it shouldn't matter to Falstaff, who spends all his time boozing, eating, and visiting brothels. Falstaff agrees with his pal's assessment and the two continue to joke around.
Falstaff says that, when Hal is king, he hopes he'll take it easy on Falstaff and other thieves that "work" at night. The two continue with the witty banter and trade insults and Hal makes an allusion to Falstaff hanging.
Falstaff tells Hal that a Lord of the Council was talking smack about Prince Hal to Falstaff on the street the other day but Falstaff blew him off. Falstaff jokes that Prince Hal has corrupted him and made him wicked.
Hal suggests stealing a "purse" tomorrow. (Not your granny's white, vinyl handbag that's full of tic-tacs. Hal's talking about the kind that's full of gold coins and carried by men.)
Ned Poins rolls up to Hal's crib. The men greet each other and talk another round of trash (like when Poins implies that Falstaff sold his soul to the devil for a cold chicken leg and a cup of wine).
Poins says tomorrow, at 4 o'clock, a group of travelers will ride by Gad's Hill on their way to Canterbury – the guys should meet up tomorrow and rob them since the travelers will be carrying a lot of cash.
When Falstaff asks the prince if he's in, Hal plays coy and says something like, "Who me? A thief?"
Falstaff teases Hal and says he's a wimp if he doesn't join his pals.
Falstaff says nighty night to his friends, leaving Poins and Hal alone to plan an elaborate prank on Falstaff. Tomorrow, after Falstaff, Peto, and Bardolph rob the travelers at Gads Hill, Hal and Poins will jump out of the bushes (wearing disguises, of course) and rob Falstaff of his stolen loot. This will be hilarious because Falstaff is sure to lie about the whole thing afterward.
Prince Hal agrees and says he'll meet Poins in Eastcheap tomorrow night.
Poins leaves and Hal delivers a shocking speech to the audience. He says he's not really a degenerate – he's just acting that way for now. Eventually, he's going to stage a dramatic reformation (from wild child to honorable prince) that will amaze everyone.
We interrupt this program with a history snack: By the time Shakespeare wrote Henry IV Part 1, folklore surrounding the historic Prince Hal was firmly established. He was remembered fondly as a wild prince who turned into a beloved ruler, King Henry V. Shakespeare got the idea for "wild Prince Hal" from popular stories and a play called The Famous Victories of Henry V (c. 1594). The opening scene of Famous Victories shows the prince and his cronies counting their loot after robbing the king's receivers.