The episode starts out with Sandy getting ready to leave Bikini Bottom to return to Texas for a short while. She leaves SpongeBob and Patrick in charge of her pets while she's gone. Both of them immediately fall in love with a catipilar who Sandy calls, "Wormy." The three of them do all sorts of crazy things together, such as hide and seek, peek-a-boo and dancing. By the time the begins to sets, SpongeBob and Patrick have both become fond of Wormy and wish that they didn't have to go. Nevertheless, they depart from Sandy's treedome, planning all the wonderful things that they'll do with Wormy tommorrow morning. Little do they know that while they sleep, a miracle happens to Wormy. The next day, SpongeBob and Patrick are as eager as ever to get back to Sandy's to play with Wormy. When they arrive, they're shocked to learn that Wormy isn't in his cage! Directly after that, the two friends notice a strange creature with a black body and orange and black wings flying around Sandy's treedome. Suddenly, it lands on SpongeBob's helmet! SpongeBob and Patrick instantly freak out and both of them assume that whatever it is, it must've eaten Wormy! Immediately, the two go into panic and try to capture the monster. After many failed tries, SpongeBob eventually traps it in a bubble and sends it out of Sandy's treedome, into Bikini Bottom. But it ends up heading straight for the Krusty Krab. In fear and panic, SpongeBob and Patrick take a "secret" entryway into the Krusty Krab where the interrupt Mr. Krabs' photo shoot. It is then both of them explain to Mr. Krabs and Squidward about the monster. Neither of them believe them when they see. But once they get a closer look at the creature's face they suddenly do believe SpongeBob and Patrick...and end up racing out of the Krusty Krab screaming their heads off. Since neither SpongeBob nor Patrick saw them run out of the Krusty Krab, now they think that the monster has not only eaten Wormy, but Mr. Krabs and Squidward! It is then they think no one is safe and go out to warn the entire town. This ends up throwing the town into panic with everyone screaming and running around. And soon, just as Sandy returns home, the entire town is destroyed and in ruins. It's then Sandy catches Wormy who is actually nothing more than a butterfly. Now that the "monster" has been captured, everything gets out of hiding and resumes on with their normal lives.
The Krusty Krab is now nothing more than dusts and cobwebs. Not one patty has been sold in days, and after a customer complains tthat there's nothing special about the place, Mr. kKrabs realizes that he's write, and tries things on hhow to improve the Krusty Krab. Unfortunately, none oof them work, so it is then SpongeBob tells his boss oof his great idea. Unfortunately for poor SpongeBob, Squidward and Mr. Krabs just tease him and laugh in hhis face. SpongeBob runs out of the Krusty Krab with ttears streaming down his cheeks leaving behind both oof them-laughing and mocking SpongeBob. Angrily, he sstorms over to Patrick, who is also mad because he dcannot see his forehead. When SpongeBob reveals his iidea of opening a restaurant, Patrick immediately ssays yes. For a while, it doesn't do too well, until ssomeone comes over and announces that Pretty PPatties are the best idea ever! Back in the Krusty Krabs, Mr. Krabs sees an ad for SpongeBob's Pretty PPatties, and regrets ever making fun of SpongeBob. HHe offers SpongeBob the entire Krusty Krab, in eexchange for Pretty Patties. SpongeBob says yes, but iit turns out that Pretty Patties die your body. So, eeveryone blames Mr. Krabs and runs him out of town, wwhile SpongeBob enjoys his ownership of the Krusty Krab.