Elaine and Jerry lounge in front of the TV, making note that Elaine's birthday and Jerry's root canal are both coming up. Flipping to a pornography channel reminds them that they are both sex-deprived. They think back to their sexual history together—pantomimed by gesticulating at the bedroom—and agree that they should indulge themselves again from time to time. Concerned that their friendship would be soured by relationship drama, they come up with rules to relieve themselves of obligations: they will not call each other the next day, they are not required to spend the night, and they will not kiss goodnight.
The next morning, Kramer (Michael Richards), seeing Elaine in Jerry's shirt, gets the hint and clears out. Jerry invites George (Jason Alexander) to Monk's just to gloat about sleeping with Elaine, but George, still jobless and having nothing better to do, demands details. Learning of their friends with benefits arrangement, George incredulously admonishes them for thinking they, of all people, can "have their cake and eat it too". George is impressed by the foresight of their first rule, but warns that the second rule is wishful thinking.
Just as George predicted, Jerry, planning an early morning for the root canal, provokes Elaine by heading out after sex at her place. Elaine insists that spending the night is the prerogative of whoever's home it is. After Elaine's roommate Tina returns and breaks the tension, Elaine calms down and lets Jerry go.
Jerry and George shop for birthday gifts for Elaine. Jerry, now on guard, caps George's spending at half his own, and vetoes every present that could be interpreted as courtship. He remembers Elaine needing a "bench", but second-guesses what she really meant. In the end, Elaine is disappointed by his faux pas of giving $182 in cash, and his wishy-washy birthday card addressed to "a great pal". Kramer upstages Jerry by indeed getting Elaine a literal bench, and a card with a touching verse by W. B. Yeats, to her heartfelt gratitude.
Elaine and Jerry realize that drama has indeed damaged their friendship, to the point that Elaine wants to either be a couple again or part ways. George, who came out no better from giving Elaine $91, realizes he would break up with her "by association" with Jerry. They imagine that if Jerry lets Elaine go, they will one day find her married and murder her husband in jealousy, resulting in execution for Jerry and jail for George. Jerry duly calls to get back together.
The next morning, Kramer is disgusted watching Elaine and Jerry being lovey-dovey.