That was at the end of season 2. He had him all lined up in his crosshairs and his car horn started beeping. When he went to his car he found a note that said “don’t”.

That was from Gus. As Mike told Gus in their most recent discussion, “I told you I wouldn’t kill him, I never promised to be his body guard”. Mike was aware that Nacho
wanted to kill Hector. He tried to give Nacho advice on how to not get caught with his plan tk poison Hector.

http://youtu.be/uYR4-f7mvYI