Members of the Althing stand in shock as the huge warrior Kurse has just snapped the neck of the newly chosen king, Balder the Brave. Thor tells Agnar to touch the corpse with the Sword of Frey; he does and the body transforms to reveal the evil Malekith. Thor and the Warriors Three investigate the jail where Malkith had been kept and discover a cranky Loki, who had been overcome by Malekith and changed into his likeness. They free him and he skulks off. Thor and his companions set out in search of the real Balder, separating at a crossroads, each to explore one of the paths….
Interlude: gangster Thug Thatcher is released from prison, plotting revenge against Thor….
Meanwhile, Thor has encountered an old peddler woman who tells him of three lovely ladies held prisoner by the troll Slaggnbir. Following her directions, the Thunder God comes upon a mighty castle suspended hundreds of feet in the air. Approaching he discovers the remains of a recently dead troll; he then spies something shiny in the grass….
At his fortress, Loki, curious as to Balder’s fate, calls up images of the recent past in a crystal ball. He sees Balder encounter the same old peddler woman directing him to the troll’s castle. Being a hero, Balder climbs the rope ladder and enters the floating structure and finds the three lovely women bound. Balder challenges the troll to battle and Slaggnbir responds with a mighty charge. The hero uses the troll’s own recklessness against him, sending him through the castle wall to his death far below. Balder releases the three maidens and they show their gratitude by offering him gifts: a ring, a belt, and a neckpiece, all garnished with red jewels. As they talk, Balder slowly loses his memory of who he is and why he’s there. They rename him Annar and persuade him to remove Karnilla’s ring from his hand and toss it out the window…
…where Thor has now discovered it. Recognizing it, he flies to the castle to search for his friend—and he meets the three sinister lovelies….