While the Quagmires keep up the search, the Baudelaires struggle to balance their studies with a punishing workout schedule, courtesy of Count Olaf.
Olaf is able to convince Nero to put the Baudelaires under a grueling exercise program, making the siblings run endless laps at night to prevent them from scheming against him, while also causing them to perform poorly in class from lack of sleep.
Due to their slumping grades, Nero threatens to expel the Baudelaires if they fail a comprehensive exam to be given in front of the entire school, but because they must still exercise under Olaf's program, they know they will likely fail. The Quagmires offer to help, and that night take their place during exercises; however, their identity is discovered, and while hiding in the library, they find the copy of the book on secret organizations and read up on the purpose of the spyglass before they are caught by the Hook-Handed Man.
The next day, with Mr. Poe in attendance, the Baudelaires readily pass the exam, and through it reveal Olaf's identity. Olaf and his gang then escape with the Quagmires, who try to shout the initials "V.F.D." from the backseat of Olaf's car. Meanwhile, Larry is rescued from the refrigerator with the help of Lemony's brother, Jacques, while Olivia walks off with the book on secret organizations that the Quagmires left behind.
