The group watches the lost tapes, in which Jim Jacobs, the leader of Heaven's Veil, describes how he uncovered the secret to eternal life though alchemy. They learn that Karen is Sarah's mother. Ann and Nick return, revealing that Ed has died in a car accident. Later tapes depict Jim experimenting with dangerous drugs to help him cross over to the spirit realm. During one trance, he possesses a cult member and announces that he has freed the first of three bindings from her soul. Ghosts kill and possess Nick when he leaves to restart the house's generator; he rejoins the others and kills Ann when they are alone. Nick and Ann, now possessed, return together to continue watching the tapes. In the tapes, Jim poisons himself during further experiments, removing the second binding from his soul, then returning once an antidote is applied to him.
