With the recent death of a fellow Leopard Lodge member, Howard fears that he may be ousted as Grand Poohbah for not attracting any new members other than Potsie during his five-year reign. He gets Fonzie, Chachi, and Roger to join as pledges, and they have to follow the orders of Potsie during their initiation.
Fonzie meets a beautiful woman, Nancy Haley, at his garage while listening to the radio in a beat-up 1955 Chevy. He takes the woman home, but when he goes back to return her purse, an older woman tells him that the Haleys moved out ten years ago when their daughter was killed in an automobile accident.
Howard decides that it is necessary to build a second bathroom after he's forced to shave at the dining room table. To save money, he decides to allow Fonzie's students to build the room. Howard doesn't realize that the room will take all semester to complete, and this hurts his plan to make a killing in whisper-quiet toilets. He fires Fonzie and the students and says he'll finish the bathroom himself.
In an attempt to help Fonzie move on after his break-up with Ashley, Potsie, Chachi, and Roger take him on a retreat to a singles resort. However, to get him to go, they tell him they're going to a sporting camp. When they arrive at the lake, Fonzie discovers what the resort is all about and says he's going to leave. He ends up staying which puts a damper on the rest of the guys' fun.