Dr. Otto is a mysterious villain with a hand growing on top of his head. He is plotting world domination using his gloom beam, which can delete matter or memory and has the power to destroy the world. The bumbling hero Lance Sterling is the only one who can stop him, but his only clue is a riddle which reads: "When the money is scrambled to the very last cent, riots and hatred soon will commence. When all the world's commerce will be put in a bind, from the evil that lurks where the sun never shines. It is I, Dr. Otto von Schnick -ick-ick-ick, who has played on you this trick-ick-ick-ick." "But who's Dr. Otto?" you may well ponder, while all your magnetic cash is squandered. It's he who had an eye, and yet couldn't see. It's he who served bouillabaisse, when he was a she. It's he who gambled with brains, and a gun. It's he who had all, and yet had none. And to stop this horrible twisted trick, just exchange the poles of old Saint Nick. And if that doesn't do to save the day, put another quarter in and try another play."
Soon Lance and his girlfriend Doris drive by Dr Otto's lair when they have car trouble, caused by Dr. Otto's gloom beam. They set off to find a phone to call for a mechanic. They eventually wander into a day care, run by Dr. Otto, which trains the kids to be soldiers. After a few adventures they finally find Otto's lair and have a fight with the doctor. The lair explodes and it all appears to be over, though Dr. Otto apparently escaped. Lance and his friends push the car to a gas station, where the owner turns out to be Dr. Otto, disguised as a character who looks & talks like Ernest P. Worrell. Lance asks for gas, but Dr. Otto replies they didn't have any. Lance and gang push the car off screen and Dr. Otto lifts his hat to reveal a hand on top of his head and yells "Have a good day, knowwhatimean!"