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Dean Loward decides to let James graduate in order to be rid of him. Zach, Karen and Larry rent a dilapidated Frat House with incoming freshmen Victoria, Maxwell and Olga, and throw a farewell party for James. But will James really be able to leave college life and his merry band of friends?

On the morning after the party, Olga, Victoria and Maxwell wake to confront their actions of the night before. James discovers that his ex-wife, Layla, has enrolled as a student, while Larry gets paired up with his former girlfriend, Ciara, in film class. Dean Loward remains determined to get rid of James, and puts obstacles in the way of his success.

James' business students resurrect an old campus bar as their class project. Erin tries to use the campus by-laws to get James thrown off campus, but fails. James and Layla come to the realization that they must make new starts, and say a final, physical farewell.

The sale of "Vantastic" creates a rift between Zach and Karen, forcing them to seek guidance from a school counselor; James and Layla battle their feelings for one another; Ciara spends the day seeking the identity of her mysterious lesbian lover; the girls object to a male-oriented theme for the weekend's reunion bash at the bar and agree to a touch-football game to settle the issue.

Graduation is assured for Larry and Ciara when Victoria bravely outs herself by showing the purloined film; Olga confesses Mr. Wright's blackmail plot, and Larry tells her they can marry in Uzbekistan; Karen makes a career choice; Dawn and Maxwell get a big offer; Phylicia rekindles her affair with Dean Loward.