SpongeBob SquarePants wakes up from a dream where he has been appointed the manager of the Krusty Krab, excited that he believes today to be the day it will come true. Because today is the Grand Opening Ceremony of the Krusty Krab 2! He goes through his early morning cleanliness routine, and heads out the door to the ceremony, but not before checking by at Squidward's first. Meanwhile, Plankton is ranting about how unfair it is that Mr. Krabs is opening a new restaurant and he, Plankton, has never even had one customer. That is until, Karen informs him about unused Plan Z, which is his most diabolical plan yet, and he sets off to put it into action. Meanwhile, Mr. Krabs unveils the new manager of the Krusty Krab 2— Squidward. This doesn't stop SpongeBob from making a scene though, not out of rage, but out of confusion. He walks home in a depression before the entire set is demolished and set on fire by Patrick
, who was planning on celebrating with SpongeBob, and has no idea what's going on now that he's driven everybody out.
That night, Plankton flies to the undersea castle of King Neptune, where Neptune's daughter, Mindy, is trying to persuade him to try some love and compassion instead of cruel and harsh punishments. After lecturing his daughter on the importance of ruling the sea, Neptune realizes that his crown has been stolen, and goes into a frenzy while Plankton flies away from the castle with the crown in his stubby hands. He flies past Goofy Goober's Ice Cream Party Boat, where SpongeBob is trying to pull himself together, and almost accomplishes it until the untimely arrival of Patrick. SpongeBob informs Patrick of what he missed, and starts to go home before he hears Patrick order a Triple Gooberberry Sunrise. Desperate for a measure to cheer himself up, SpongeBob stays for one. Then another. Then ten more. Needless to say, he and Patrick end up getting drunk and passing out over ice cream
SpongeBob awakes in the morning loopy and droopy from last night having a G-Rated Hangover
. He realizes he's late for work and speeds off to the Krusty Krab 2, full of spite and hatred towards his boss. But he's not the only one heading there. King Neptune is riding over on his chariot, and Mr. Krabs exposes himself at once, thinking Neptune's there for spending. Unfortunately, he's not, and immediately calls him out for a note Plankton left there, stating that Mr. Krabs stole the crown. Out of fear, Mr. Krabs explains that anyone would vouch for him, only for SpongeBob, still in hangover mode, to stumble through the door. Unaware of the consequences of his actions, SpongeBob calls Mr. Krabs a big jerk in front of King Neptune. This is enough for Neptune to finally attack Krabs, restoring SpongeBob to his rightful senses, and telling him that he won't let him burn Mr. Krabs. Neptune is ready to fry them both, but Mindy steps in and asks her dad to give SpongeBob a chance to reclaim the crown, which is now in the forbidden town of Shell City. SpongeBob accepts this chance to save his boss, and with Patrick at his side, the two speed off in the Patty Wagon, an emergency promotional vehicle, on the road to Shell City.
Neptune leaves with Mr. Krabs frozen wear he stood, so that he won't go anywhere. While Mr. Krabs is like this, Plankton finds it pretty easy to slip by him and take the secret Krabby Patty formula. He takes it back to the Chum Bucket, and begins with rapid marketing. Eventually, SpongeBob and Patrick come to the county line, where their car is stolen, but their spirits are high for he rest of the day. After Karen points out to Plankton that the duo could stop his plan from working, he informs her that he hired a homicidal predator to hunt them down and do what he must do. Fortunately for them, he hasn't crossed their path yet, but they are getting rather tired without their car. That is until they come across a biker club with the car parked just outside. In an elaborate and highly not well thought out plan, sheer luck reunites SpongeBob and the key, and the two can continue their journey on wheels.
Back in Bikini Bottom, Plankton has out done himself, and everybody in town has come to the Chum Bucket to buy Krabby Patties with free Chum Bucket bucket helmets with purchase. Of course, this plan is more than just becoming a successful business man. When everyone in town has a bucket helmet on, Plankton is able to start phase two of his plan, and with the single click of a button, the helmets take over the minds of every one wearing them, and force them to do his bidding. This is all, of course, unbeknownst to SpongeBob and Patrick, who come across an ice cream stand, which they immediately flock to. Unfortunately, this is no ordinary stand; it's actually a giant fish that lures in its prey using the stand as a cover up. SpongeBob and Patrick narrowly escape, but lose the car again, this time for good, and now they must face a larger obstacle, and giant, dangerous, hazardous, monster infested trench.
Before they go down, however, Princess Mindy stops them and offers some encouragement. This, however, quickly goes south, as the two break down at the information of Plankton's take over. There's no other way, she has to trick them with her "mermaid magic". She has them close their eyes, and she puts some sea weed under their noses to fool them into thinking that their men. With their sudden bursts of maturity, the two jump down into the trench, convinced that they're now invincible. But as far as things go in the trench, they're pretty much correct. They make it through (in song) while various hazards come within mere inches to keeping them as a meal, but they hardly even notice. In fact, they eventually have a slap dance contest, which ends up winning the monsters
friendship, and they let them through he trench unharmed.
Once out of the trench, Shell City is as good as theirs. That is, until they're stopped by Dennis, the assassin Plankton sent to get rid of them. But before he can step on them with his absurdly spiky cletes, he himself is stepped on by a giant, live action boot
. At first SpongeBob sees it as a friend who saved their lives, but is quickly taken aback when it reveals itself as the cyclops that guards Shell City, and the two are taken captive. When they awake, they are trapped inside a wall of psychic energy (a glass fishbowl). It is then revealed that the cyclops owns a gift shop where he sells marine sundries. The two see him make a humorous diorama of "Alexander Clam Belle" right before he takes them out and places them under a heat lamp for drying. The two have a sad moment where they think they failed in ever reaching Shell City, but Patrick reads the sign of the gift shop which is actually Shell City. The two have a last look around to find the crown, which is standing on a table next to them, and sing one last chorus of the Goofy Goober song before shedding a tear apiece, and completely drying up, becoming no more than a live action starfish and sponge with clothes.
Their tears slide down the table that they're (presumably) dead bodies are laying and meet in-between them, forming a heart, before sliding down all the way off and down an electrical chord and into an outlet, causing the fire sprinklers to go off, instantly restoring them to their full and healthy state. They escape the cyclops, get the crown, and run out of the shop and onto the beach. Their means of getting back to Bikini Bottom, however, are looking pretty grim, and it is at that very moment that King Neptune is on his way over to the Krusty Krab 2 to perform the execution of Mr. Krabs. But with one last hope, David Hasselhoff comes running towards them on the beach, volunteering to take them there. They ride the Hasselhoff back to Bikini Bottom, but not before shaking of Dennis (who survived being stepped on) one last time. Once they get to the island seen at the beginning of the theme song, SpongeBob fears that they won't be able to float down in time, which is when Hasselhoff uses his pecks to shoot them straight down to the bottom of the ocean reflecting the fiery beam coming out of Neptune'strident just before it makes contact with Mr. Krabs.
With the crown back, you'd think that everything would be fine, right? Wrong. Plankton releases the umbrella to keep the rain off of his parade, which happens to be a giant bucket helmet right on top of King Neptune's bald head. Plankton orders all his helmet zombies after the three people still not in his control (aside from the still frozen Mr. Krabs), and they're cornered in the Krusty Krab 2. Plankton monologues for a bit, but before he can order the final attack on the three, SpongeBob breaks out in an ultimate rock song, which is powerfull enough to shoot beams out of the end of his guitar and free the people from Plankton's helmets. In an attempt to escape, Plankton is stampeded and eventually sent to jail. King Neptune returns Mr. Krabs to normal, the citizens are free from Plankton's evil helmets, and SpongeBob is finally appointed manager of the Krusty Krab 2