Chris and Sergeant Mark are held hostage, and their only hope for rescue rests in the hands of Swagmaster.
The blooper opens with Chris heading to Sergeant Mark's for an unknown reason. Upon reaching Mark's office, Chris finds him held captive by Butt Ninja and The Terrorist and is held a hostage, hoping that Swagmaster6969696969 would get him out of his situation. Elsewhere, Swagmaster is looking for a beer at a drinks machine and finds only pop: in particular, Coke, Coke Zero, Diet Coke, Sprite and Solo. Believing it's actual drugs, he chooses Coke Zero, only to be asked to pay $1.95 more. Fed up, Swagmaster gives the machine a rocket launcher, causing it to fly through the air and landing and crushing Greg. Swagmaster realizes his mistake and mourns the drink machine, instead Admiral Greg is unsatisfied with the situation. This shows how much Swagmaster doesn't care about his coworkers.
After waiting for Chris and flirting with a female worker, the Terrorist announces his plan to destroy the spaghetti factory starting with Mark and Chris unless it gives him the money vault. But Chris announces that the hostage situation is actually a swag party, hoping that it would trick Swagmaster into coming. It works as Swagmaster is utterly jealous and tries to find their location. However, he comes across an ill-gotten friend in the form of a homosexual whom he met in a gay night club he arrived at due to being drugged, blowing him up with a rocket launcher to avoid speaking to him ever again.
Back at the hostage area, the Terrorist explains why the two are important: Mark is the leader of security, and Chris apparently knows codes to nuclear rockets that Mark accidentally left to him, only for them to turn into Swagmaster's hands thinking it was a porn stash. He is called by Swagmaster on his MLP-theme-ring-toned cell phone to ask how he can get to the swag party, posing as 'Lady McFag', and as he talks to him in a threatening manner, the Terrorist hangs up on him, causing Swagmaster to step up his violence and start shooting up his forces. Chris is confidant that he'll 'be his worst nightmare' until Swagmaster reveals he knew the rocket codes. The Terrorist sends Butt Ninja to retrieve him, as Butt Ninja tricks Swagmaster into eating a shroom. The resulting effects cause him to hallucinate in the setting of the SM64 Bloopers where he meets SMG4 and Mario, who think he is a pedophile and pull a gun on him. Though he claims peace, Luigi arrives, and Swagmaster, thinking he is Greg, attacks him as SMG4 and Mario are blind to the violence before them. When the Terrorist is alerted, he arrives at the drugged Swagmaster as he hallucinates him as Peach. Though he is slapped into being sober again, and falls down in shock, wondering if what he was touching was women or man boobies.
Swagmaster is held at gunpoint by the Terrorist and threatened to give the nuclear rocket codes, but he doesn't remember them at all. Not believing him, he threatens Mark's life, tough Swagmaster only treats him as a hostage sacrifice, as he is shot when he gets the codes wrong. Then when the Terrorist threatens Chris, Swagmaster responds by engorging his big pingas into a fist called the 'Mega Swagalicious Pingas' that punches the Terrorist, who flees. Though he tries, he is then cornered to a wall and blasted into oblivion, possibly killing him. Then the blooper ends with the two of them and Butt Ninja having a swag party, while a dying Mark is drugged with a mushroom and sees Mario dancing naked and says 'Jackpot :D'.
- When Chris says "Suprise Mofo" his text is red like Swagmaster69696969696's, instead of white.
- The Terrorist announces that he wants to know where the facility's money vault is, but later he says that he wants the code for the nucular rockets.
- This is the first time the SM64 layout of the Mushroom Kingdom is featured in a Guards N' Retards blooper.
- This is the first time SMG4, Peach and Luigi meet Swagmaster6969696969. This is also the first time Sergeant Mark meets Mario.
- This is the 200th viewable episode overall.
- When the cell phone rings, the ringtone is the 1983 My Little Pony theme song.
- It's possible that the phone belongs to Chris, as Swagmaster seems to know the number and possibly called him to gain access to the non-existent Swag Party.