In Eric's bedroom, he and Donna are studying together but then begin making out... a little later, as they're putting their clothes back on, they both agree that they need to get some work done, and start to study again, but the studying rapidly deteriorates into making out again... a little later, as they come out of Eric's closet, Eric says that they really have to get to work. They sit down on the bed, and Eric starts reading his text book, pondering what to write for the essay; Donna makes a comment about the essay, which Eric ignores; Donna becomes angry that he ignored her input for the essay, and they start to argue about the US/Russia arms race (the topic of their paper) and Eric tries to defuse the situation by trying to make out with Donna, but she pushes him off the bed.
[Scene change: Eric falls, while Donna jumps in the air.]
In Eric's bedroom, Donna tells Eric that he can't just ignore her ideas, and that he's wrong; Eric suggests a "study break" but Donna says no, she's not in the mood. Eric asks why not, and wonders if it's because he's disagreeing with her, then asks if she's holding out on him, and tells her that it won't work. Donna says that she's not holding out, but if she were, it ~would~ work; Eric decides to go on the offensive and tells Donna that she can't cut him off because he's cutting her off. Donna tells him that he'll cave before she does.
In the Forman basement, Kelso tells the guys that he saw a UFO; Hyde and Fez both laugh at him. Kelso tells them that he wants to go to the field tonight and look for more UFOs.
[Scene change: Kelso jumps in the air.]
In the Forman driveway, Kitty comes out and asks Red what the horrible noise is; he tells her that it's Bob, cutting a tree down. Kitty comments that it could be dangerous for Bob to do that alone; just then, Bob yells "timber!" and the tree falls directly towards Red... Red is in a casket; he sits up and says that Bob killed him. Kitty tells him that Bob feels super bad about it. Red looks around the empty room and asks where all his friends are; Kitty informs him that he has no friends, and Red sadly realizes that he should have been nicer during his lifetime, then lies back down in his casket... Bob runs over to see if Red is okay, and says that it was an accident. Red hugs him and tells Bob that he's glad that he's his friend.
[Scene change: Red looms towards the camera.]
In the Forman basement, Hyde and Eric are on the sofa; in a split screen with the back porch where Donna and Jackie are, they have a conversation. Both Donna and Eric say that they're holding out on the other, and it's been three days and they're about to cave. Hyde tells Eric that if he caves, Donna will own him; Jackie tells Donna that when Eric caves, she'll own him because sex is how women control men. Hyde tells Eric that sex is how women control men, and he suspects that women like sex too, which Eric finds hard to believe.
In the Forman kitchen, Hyde sits at the table making a mountain out of mashed potatoes; Kitty tells him that this is a close encounter of the potato kind. Red comes in, smiling and happy, and suggests that they have a party for all their friends. Kitty is shocked, but agrees that it's a good idea. Kitty says that he doesn't think that he's ever heard Red use the words "fun" "party" and "friends" in the same sentence, but Hyde says he has, for instance, when Red would say, "Hey Eric, I had fun ruining your party for you and your friends."
In Eric's room, Donna comes in wearing her winter coat; she takes it off and is wearing a sexy red sweater underneath. Eric thinks that she's hot, so to fight back, he uses "the look" on her. Donna starts to crumble, but then "drops" her pencil on the floor and bends over in front of Eric to pick it up. They open their books, and Eric starts blowing in her ear, so she puts her hand on his thigh. They're both on the edge of frustration, when Kitty comes in and tells Donna that she's wanted on teh phone; Donna runs out, and Eric puts the text book in his lap and tells Kitty that everything is fine.
[Scene change: Kelso and Jackie jump in the air.]
In a field, Kelso starts humming the music from Close Encounters of the Third Kind; Fez and Hyde join him. Leo shows up; they ask what he's doing there, but he doesn't know. Kelso points out some lights, and says that it's the UFO; Fez says taht it's an airplane. Leo tells the guys that he saw a UFO once, and it told him to have a good year. Hyde asks if he saw it while he was at a football game; Leo asks how he knew? and the guys all laugh. Leo then tells them that it wasn't a good year at all, it was a terrible year.
In the Forman living room, Red and Kitty are having a party; Bob talks to Tony, then tells Red that he was telling Tony about the near-miss with the tree. Bob says that it makes you think, and Red agrees, then tells Tony that it made him think about how Tony had never returned his hedge clippers. Tony admits that he lent them to his brother-in-law; Red tells him it's not like he stole them, he just took them and never returned them. They share an uncomfortable laugh together.
In the Pinciotti kitchen, Donna asks Midge if she and Bob have ever had an argument that crossed over into other parts of the relationship? Midge doesn't understand, so Donna makes the question plainer and asks if Midge has ever not had sex with Bob in order to win an argument, or get him to do something. Midge is shocked that she can do that, and decides to start immediately, so that she can get her bathroom painted. Donna is worried that it might hurt the relationship, but Midge can only think about the bathroom.
[Scene change: Donna jumps in the air.]
In the Forman living room, Red is talking to someone who is telling him a bad joke; Red imagines... his funeral, and he's lying in the casket. The room is full of people, including the party guest who is still telling bad jokes, and Tony, who is borrowing things. Red wants quiet; Kitty comes by and tells him that he's the corpse of the year, and asks if he's having fun? Red tells Kitty that life is too short to spend with people who annoy you, and kicks everyone out of the house.
In the Forman basement, Leo comes in with Kelso's pictures of the UFOs in the field, and starts showing them, then tells Kelso that he really likes the naked ones of Kelso as they're much more interesting. The guys all crowd around to see the pictures, but Kelso grabs them and runs out. Leo tells Fez and Hyde that it's okay, because he has a second set, and they start looking through those.
In Eric's bedroom, Eric tells Donna that they have to do the report for school; Donna says that the Cold War was a stand-off in which neither side got what it wanted; Eric agrees that each side was really only hurting itself. Donna says that the whole thing is incredibly frustrating for both sides; they agree to call it off: Donna tells Eric that he wins and they start kissing, but Eric snickers and then tells Donna that he can't believe that she caved, and he can't wait to tell Hyde. Donna tells Eric that she's suddenly not in the mood, but Eric says that they're already past the point of no return. Donna informs him that there is no point of no return for girls, and heads for the door. Eric calls her back, and asys taht he gives in and she wins; Donna says "good, cause I was just bluffing." They start to kiss...
[End credits: Still shots of Kelso with his shirt off, in various poses.]