A youth program offers $20,000 to the most promising projects to get the successful applicants started. Kyle and Seth have developed an automatic gearing system for racing bikes, Loc has developed a website which attempts to reunite refugees separated from their families and Basia is an aspiring documentary maker. Then there are Clare and Patrick have driven all the way from Gunning with samples from their yabby breeding program and Katherine desperately wants the freedom to write and perform her own musical compositions. As the applicants go through the interview process, each with their own confidence or lack thereof, and the time to the final announcement of winners draws closer, they deal with the pressure in their own ways.
It's the first meeting at the Foundry and Garrett drills the new team on the rules and regulations of life at Head Start. There aren't many and they're pretty basic. The winners pick out their individual rooms and set about getting to know each other. Of course, there are a few teething problems.Loc wants to rectify the situation with the computer shop. Tran continues to hassle him for money and Loc tries to avoid him but is followed back to the Foundry.Kyle is stunned to learn that Terry and Posy want nothing more to do with him. Meanwhile, he gives Seth a peace offering, with a bit of help from Basia.An impromptu celebration might have consequences for Katherine when she gets drunk for the first time. Moira turns up and is unimpressed, giving not only Katherine, but an earful to Garrett as well.
Loc apologises to Clare for the damage to the yabby tanks, but Patrick isn't pleased and attempts to enforce his racist views. Loc makes extra cash to pay Tran back with by building a web site for Sacha. Patrick follows Loc to a meeting with Tran to see what Loc is up to but finds himself in too deep when Tran turns on him.Seth confides in Kyle about missing Katherine, who convinces him to go to her house to ask her out. When he gets there he meets Katherine's mother and finds out that she's leaving Head Start to pursue a performance career. And Basia is having difficulty getting Amanda to open up to her.
Garrett stirs up Kyle and Seth about their project at the breakfast meeting because he hasn't seen much activity on it. While at the velodrome for another series of bike trials, the boys encounter Terry who has developed a conspiracy theory as to why they were selected for the program instead of him.
After seeing posters in the street Seth has an idea for Katherine to hold a recital to showcase her music. Katherine reluctantly agrees and Garrett gives permission for it to be held at the warehouse.
Growing dissent within the group forces Garrett to suggest a little bonding exercise aboard a sailing ship, which turns out to be more turbulent than he could have ever imagined.
Kyle's secret relationship with Allot's wife reaches boiling point when Basia confronts her greatest fear.
Kyle naively welcomes Felice's advances and an affair ensues. Weaving her web, Felice convinces Allot to give the boys a chance. Allot goes to the Warehouse to have a look around and impressed, offers the boys a deal. Garret gives his approval and Kyle and Seth are ecstatic. Amanda receives her validated pilots licence and is enthusiastic about getting back in the air. Just as things settle down between Loc and Clare, Patrick delivers Loc an ultimatum. Break up with Clare or he will tell Garrett everything about his connection with Tran. A devastated Loc has to make a choice: his project or his relationship.
Basia's birthday rave offers the group a chance to relax and unwind, but when Basia finally decides to make her feelings known to Kyle, the night takes a turn for the worse.
Mounting a bike-a-thon for charity causes strain between Kyle and Basia, while Patrick arrives at a crossroad over his life in the city.
Things hot up at the Foundry when Garrett's daughter moves in. Loc realises the extent to which his site can help refugees.
Basia films Amanda without her consent and becomes faced with a moral dilemma and Seth's romantic involvement with Skye puts pressure on his friendship with Kyle.
Kyle finds himself in trouble as Skye tries to sabotage his partnership with Seth and Clare sets out to prove she can be successful without Patrick's help.
Tension mounts between Skye and Garrett, resulting in a surprising revelation. Meanwhile, Clare and the Yabbies become overnight celebrities.
Katherine hits the clubbing scene, and after playing some of her music for Basia she decides it's time to get her own music into some dance clubs while Clare is swamped with orders for yabbies since her TV appearance with Rod, and Seth's so preoccupied about Skye leaving that he forgets to fix a fault in the bike's gearing system. The resulting accident leaves Kyle unable to work and Seth has to take over as courier.
Rod asks for exclusive rights to Clare's yabbies, and Katherine's transformed herself and found her music niche, but is unsure of her next step.
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Head Start has a new recruit - Jade. She's a fashion designer who's not afraid to rub the gang the wrong way.
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Kyle and Seth have failed and are close to being kicked out of Head Start. Jade successfully launches her label in a fashion parade at the Foundry.
Pushing yourself to the limit takes on new meaning when a friend of Patrick's arrives from the country. Meanwhile, Kyle has to curb his jealousy when confronted with a short film Basia acted in - completely naked!
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Kyle has to juggle a near impossible situation: looking after his pregnant ex girlfriend while trying not to hurt his current one.
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Kyle makes the ultimate commitment to Posy. Patrick gets a nasty surprise when viewing the footage from Basia's 'behind the scenes' rock documentry.
Katherine must choose between Patrick and her career. Meanwhile, a newcomer, Aaron causes intrigue with his mysterious project.
Katherine sinks deeper into Jordan's clutches with a growing reliance on amphetamines and Patrick secures a deal exporting yabbies to Japan.
Aaron's doing the perfect job for the perfect couple - or is he? Basia learns that finishing a film is really only the beginning.
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Katherine arrives back unexpectedly from her promotional tour with a dark secret. Jade meets one of her fashion heroes.
Struggling to fit back into Head Start pushes Katherine to the brink. Kyle and Seth sell their gears to a big company.
Flushed with success, Kyle and Seth are forced to examine their friendship. The day of Katherine's court case arrives.
Patrick's world starts to crumble when he comes up against an extortion racket at a transport depot. Meanwhile, Basia discovers that she still has feelings for Kyle.
Basia is nominated for an award for her doco, she invites everyone especially Kyle. He says he would not miss it for the world. Basia wins but she is not in the mood to celebrate her trip to Canada because Kyle failed to turn up because his partner in the bar said, it's busy, it's your decision the bar or your ex girlfriend. He chose the bar. Basia is in bed when Kyle walks in and apologizes. She tells him to go away and leave her alone. She falls asleep crying.
Aaron after clinching the tender of landscaping for a big company sees that he will be working with his father, decides that he is not going to be controlled by his father. He says he will not be forced into doing it. After a lot of thinking he comes clean to Jade saying, he blamed his father for not doing his but it was actually fear. Jade tells him that it took courage to apply at Headstart and he was accepted. So why not to do this. He then accepts and signs the contract for the landscaping and decides he can get along with