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Set eight years after Banjo-Tooie, the game reintroduces Banjo and Kazooie by showing a retrospective video featuring Nintendo 64 clips of previous Banjo games with voice-over narration. The duo are eventually shown in Spiral Mountain, where they have grown immensely overweight after eight years of inactivity, eating pizza, playing video games and listening to the radio. Banjo and Kazooie discover Gruntilda's detached head returning to Spiral Mountain. They are about to fight when they are stopped, literally, by a new character named Lord of Games. Also known as L.O.G., he attempts to settle the conflict between the two by devising a series of worlds and challenges. He uses his powers to give Gruntilda an artificial body and to restore the duo's physical fitness, but not their moves from previous games.
L.O.G. transports the other characters to Showdown Town, his headquarters, and starts the contest. The winner would be set to own Spiral Mountain; the loser must endure eternal hardship at L.O.G.'s video game factory. While Banjo and Kazooie seek to win by completing the challenges, Gruntilda uses her powers and abilities to try to stop the duo. An army of mechanical Gruntbots also assist the witch in her goal. The game ends with Gruntilda and Banjo attempting to face a final duel when L.O.G. once again comes in to stop them. After L.O.G. sends Gruntilda off to toil away at his video game factory, he rewards Banjo and Kazooie by restoring their moves and giving them the deeds to Spiral Mountain. Gruntilda vows that bringing her to the factory was a mistake and that she will make her own video game.
