After the initial cutscene and you gain control, go straight onto the stage and grab the first Letter to Santa. Head to the store and break the window, then grab the gun inside. So, things go down the drain and Clawz will show up, turning the residents into gingerbread men with weapons.
Start shooting them and making your way to where Clawz is located, then shoot his sleigh to make things go a little more wacky. It turns out that the real Santa appears and he has been downed, so rush over to revive him. He says that the holiday spirit is no longer present and asks for your help in bringing it back.
Go to the park and you’ll get the locations of various bells on your map. While fending off attacks from the gingerbread men, you have to ring the bells by either shooting them or walking up to them and pressing the button shown. At one point, you are given the choice between ringing one last bell or ringing them all.
Once you’re finished with that, Santa says to find the projector that was frozen in the lake by Clawz. When you get there, kill all of the enemies in the area, then break the ice by using something explosive or your Stomp power. Pick it out of the water with Telekinesis, then bring it to the theatre, placing it on the roof.
This will end up bringing Clawz’ sleigh down, but you can’t hurt him, as he has a shield around him that powers can’t even take away. To further power the projector, CID will appear at the top of the clock tower and you’ll need to protect him, so get over there and start killing any enemies that appear.
Once CID is finished and the enemies are cleared, jump to the roof and help with the antenna. Even if you keep choosing "no," you will agree to it in the end. Head back to the projector and turn it on, then you’ll have to fight with Clawz, who is basically a Warden from the main game. Deplete his health, then go up and press the button to finish him off, bringing an end to the mission.