Last we left Happy!, Amanda had injected Nick's derriere with some kind of poison while Smoothie watched (and was probably in seventh heaven). Well, it didn't kill Nick, just addled his brains. Smoothie needs Nick alive. For what? To break his spirit. He locks Amanda up, and takes Nick to the Eggstravaganza.
Speaking of the Eggstravaganza, Hailey is there as well, and when she arrives is escorted by security past the line for the plebs, and into the VIP green room, where she is met by Orcus. Of course, Orcus didn't pitch the Hailey addition idea with Sonny in the development stage, so now he's got to win over the prima donna. After some sweet-talking, it's a go! Sonny's on board.
Meanwhile, Amanda gets to watch the whole show from inside a locked observation booth. It's not the best seat in the house, but it's also not crowded. She's locked in there with Happy, who makes a getaway through the keyhole, and somehow unlocks the plates inside, opening the door in the process. That's Amanda's cue to break out.
And Smoothie's taken Nick to watch the magic from closer to the stage. Nothing like comps. This is all part of Smoothie's plan to ruin Nick: make him watch his daughter kill Sonny. That's when Hailey takes the stage and sings her song to the packed house. It's like if Sia wrote a Disney tune, and gave it to a girl way too young to understand what it means to sing. Either way, she captivates the audience.
That's when the unexpected happens. Sonny inserted some undiscussed material into the show: a gun-toting bunny who terrorizes the audience. It's all part of Sonny's ploy to make himself the hero.
Happy shows up, finds Nick, and tries to jolt him from his stupor. So, he cracks open an imaginary cold one, and pours it down Sax's gullet. Because Sax believes in Happy, and all that Happy does and is, the beer becomes real too. Thing is: alcohol will dilute the poison in Sax's system and turn him into the functioning inebriate we've all come to love.
Back to Sonny, after vanquishing the bad Easter bunny, he takes things way too far, and opens the Easter bunny's head with a sledge hammer. That's one way to crack an egg. The kids love it. But then Hailey makes her second entrance of the day, this time with her co-star: a loaded handgun. Amanda and Nick are on-stage to try to discourage her from pulling the trigger. It doesn't work — she's out for vengeance. She lets fly a bullet in Sonny's direction. That's when Nick takes a running leap and stops the bullet with his chest. So Amanda has to finish the job: She opens fire on Sonny just as he steps downstage to greet his fans.
This totally screwed with Orcus' and Smoothie's plans. Nick's on the out, and a team of SWAT swarm the building and arrest Amanda. Nick has been sent to the Great Beyond, where there is a harem of women that just wants to pleasure him. He's OK with that. But Orcus shows up and reminds Nick that Smoothie is out there running free. That complicates Nick's plans. Orcus brings Nick back to life, on the condition that he now owns his soul. Done deal.
And Amanda's been sent to prison for first degree murder. So, Hailey is commended into the care of Merry, who's now with that cult task force, if you remember. Happy, meanwhile, is having a time. With Nick dead (so he thinks), Hailey not believing in him anymore, all the children dejected past the point of imaginary friends, and Bo Peep losing her sheep all over town, he's ready to give up. Happy soars into the sky and talks to God, who gives him a pep talk.
Six months later, Nick is recuperated, and has dropped in at Smoothie's house to put an end to their relationship. He gives Smoothie's head one twist for every twisted thing he ever did to Hailey.