Ser Lancel informs Tyrion that Cersei plans to send Prince Tommen away from King's Landing.
Tyrion schemes with Bronn to have Bywater cutoff Cersei's men and replace them with his own—this way, Tommen will still be safe. Make that safer, since Tyrion will surround him with less cowardly, more loyal soldiers.
Tyrion rides to Chataya's brothel to use the secret passage but loses patience and goes straight to Shae's mansion.
Tyrion and Shae enjoy some skoodilypooping, and then Varys shows up to inform Tyrion that Ser Cortnay Penrose is dead. Stannis is now RSVPing for an invasion of King's Landing.
Shae wants to go with Tyrion and be his lady, but Tyrion believes that impossible, so instead, he plans to sneak her into the Red Keep to work as a scullion.
Shae isn't fond of the idea, and the couple has a fight. Tyrion explains that he married a prostitute once, and his father nullified the marriage and then did something awful to Tyrion and his one-time bride. Let's just say it was pretty heinous.
While riding out with Varys, the eunuch suggests that Tyrion put Shae in the service of Lady Tanda as a maidservant—she'd be safer than in the kitchen and less likely to come across a spy, too.
While everyone is sharing past secrets, Varys gets in on the action.
He tells Tyrion how he was part of a traveling actors group when his master sold him to a conjuror. The man removed Varys's manhood and fed it to a fire to summon some daemonic creature.
Left in the streets to die, Varys swore he'd do anything to survive. To this day, he still doesn't know whether that presence in the fire was real or imaginary.
Tyrion asks Varys if their father will make it to battle Stannis, or if Littlefinger was successful, but Varys doesn't know.
Tyrion laughs. When it's all said and done, the only thing that can protect the crown and people of King's Landing from Stannis is the dwarf they all despise so much.