Reinhard confides in Hildegard that his memories of Kircheis motivated him towards ceasefire talks. Yang discusses the situation with his staff. The death of Fischer basically cut off the legs from Yang's fleet. Yang decides to accept the ceasefire talks. Yang leaves Iserlohn with minimal military personnel and the politicians from El Facil. Fork's ship finds Yang's ship en route to the Imperial fleet. Behind Fork two Imperial destroyers fire on Fork, killing him. Back on Iserlohn, the crew receives word of an assassination attempt by Fork. The Imperial ships requests a meeting with Yang. The crew behind the ships are in reality Earth Cultists in disguise. Patrichev and many others are killed defending Yang. Schenkopp with his Rosen Ritter arrive on Yang's ship. Yang is shot in the leg.

Schumacher is caught by the Imperial police. Schumacher confesses that he thinks the last of the Earth cultists have landed on Phezzan. Julian and Reinhard exchange stories and political points on their trip to Phezzan. Reinhard's sister and wife tend to him as he lays bedridden. Oberstein releases a rumor that the Kaiser is getting well to drive out the remaining Terraists. Julian and friends notice the Earth cultists at the hotel and kill the last of the Terraists. Oberstein used himself as bait and died in place of the Kaiser. Reinhard is surrounded by all his admirals, family, and ministers as he prepares to die. Reinhard wants to leave his son with a friend equal to Kircheis and chooses Mittermeyer's adopted son. The Julian fleet members go their separate ways. On July 26th of Space Calendar 801, New Imperial Calendar 3, Reinhard dies. At the Mittermeyer estate young Felix reaches for the stars, echoing Reinhard's ambition.

Reuenthal returns to his office and assigns all domestic political matters to Elsheimer. Trüniht is killed by Reuenthal after they both discuss their ambitions and Reinhard. Reuenthal is visited by Elfriede von Kohlrausch and her baby. Reuenthal requests that she give the his son to Mittermeyer. On November 14th, Space Calendar 800, New Imperial Year 2, Reuenthal dies at the age of 33. Mittermeyer arrives on Heinessen, but is too late to meet with his old friend. Admiral Bergengrün, who also served under Kircheis commits suicide, after hearing of Reuenthal's death. Bergengrün had lost both his commanders to underhanded political schemes. Lang confesses to all his actions and implicates Rubinsky. Rubinsky is nowhere to be found.

The Rosenritter soldiers latch on to Flagship Brunhilde. The Imperial doctors reveal to the admirals that Reinhard has an unknown and incurable disease. General Schenkopp holds off the Royal guard with his soldiers. Reinhard prepares to meet with Julian, should Julian make it to his room. Bittenfeld frustrated with inactivity, rushes into the Merkatz fleet. Admiral Merkatz is killed in battle. Mashengo dies protecting Julian from gunfire. Schenkopp is fatally wounded in battle while Poplan fights off Reinhard's Imperial guard. Julian reaches Reinhard's room for negotiations. A truce is announced.

Julian finds Yang's body. The Yang staff return to Iserlohn. The crew of Iserlohn enter mourning. Julian tells Frederica about Yang's death. It is decided by Yang's remaining staff that Frederica will assume the role of political leader. Julian is considered to be the next military leader. Julian accepts the role of military leadership after talking with Frederica. Unrest within Iserlohn grows and there is talk of desertion. Admiral Murai speaks with Julian and gives him his resignation. Murai intends to fulfill his last task for Yang by taking all dissidents from Iserlohn with him as a desertion leader. The remaining leaders of El Facil abandon the Yang fleet.

Yang boards the Brunhilde and meets with Reinhard. Yang declines an offer by Reinhard to the position of Imperial Fleet Admiral, instead preferring to retire to a quiet life. Reinhard and Yang discuss government and philosophy. The treaty of Barlat is announced, formally ending hostilities. The concessions within the treaty increase civil unrest, public anger turns from the Empire to former Chairman Trüniht. Admiral Lennenkanpt is appointed Imperial consul of Heinessen. Julian, Mashengo, and Boris Konev prepare to visit Earth. June 20, 799 S.C. / 490 I.C.: The regent of the young Empress signs a declaration abdicating the throne to Reinhard. Beginning of the New Empire; year 1 of the New Imperial Calendar (N.I.C.).

Bucock's fleet advances through the Müller fleet while being pursued and surrounded by many others. Bucock's Alliance fleet is unable to charge and kill Rienhard. Hilde advises Reinhard to offer surrender to Bucock. Instead of accepting defeat, the Alliance officers toast to friendship and democracy. Afterwards, the Imperial fleet decimates all remaining Alliance ships. The Imperial victory celebration is cut short when news of Lutz's defeat at Iserlohn is received. The situation has changed for the Imperials if the plan was coordinated. The Imperial fleet would have cut off supply lines if Phezzan fell as well. With that possibility, Reinhard could have underestimated the importance of Iserlohn. Countering the panic, Hilde points out Yang would not have sacrificed his allies for a stall. The Imperial forces thus resumes their course for Heinessen.

The Imperial fleets adopt a tactic of attrition via rotations. The Müller fleet, Mittermeyer's subordinates, Bittenfeld and many other Admirals rotate on the battle line. Yang's fleet, with less that 20,000 ships left fights on with no rotations in manpower. Bittenfeld's elite troops cause a fatal blow to Yang's fleet. Admiral Fischer, the one in charge of Yang's fleet maneuvers is killed in battle. Reinhard passes out from sickness. A ceasefire is announced. The Yang fleet passes out in Iserlohn.

Julian answers complaints on Iserlohn. Reinhard visits many locations on Uruvasi. That evening the guards around the guest house act erratically. Lutz, Müller, and Reinhard's personal guards escape via car with a battalion of soldiers in pursuit. In the woods, the Reinhard entourage is attacked by soldiers and snipers. Eventually they meet up with the flagship Brunhilde. High Admiral Lutz stays behind to hold off the soldiers and is killed. Konev brings news of Reinhard escaping Uruvasi with only a single ship. Merkatz advises Julian on Reuenthal possible plans.

Mittermeyer's fleet catches up with Reuenthal's fleet as they head to Heinessen. Grillpalzer betrays Reuenthal's fleet and fires on his former allies. Reuenthal's flagship is hit by long distance artillery. Reuenthal is impaled in in the chest by a piece of metal. Reuenthal continues to order tactics as he becomes pale. Grillpalzer surrenders to Wahlen's fleet. Mecklinger discovers Terraism evidence on Uruvasi hidden by Grillpalzer. Mecklinger orders Grillpalzer arrested. Reuenthal returns to Heinessen with only 10% of his fleet remaining.

Bittenfeld is wary of the message and takes a cautious fleet formation. Yang takes advantage of the communications jamming between both sides of the corridor and tricks Mecklinger into withdrawing to the entrance of the Imperial side. The Bittenfeld fleet is lured into the corridor by Attenborough's fleet. Fahrenheit's fleet follows Bittenfeld, planning to overwhelm the Yang with numbers. Yang uses the superior numbers of the Imperials against them, forcing the Imperials to cluster together inside the tight corridor. High Admiral Fahrenheit is killed in battle preventing the complete destruction of the two Imperial fleets.

Attenborough's fleet lines the entrance of the corridor with mines. He plans to snipe the Imperial fleet as they come through small holes within the minefield. The Imperial fleet creates 5 entry holes through the minefield to establish a bridgehead. Steinmetz is killed in battle. The Imperial fleet movements are sluggish within the corridor. Reuenthal orders the Imperial fleet to feign a retreat. The Yang fleet approaches the Reinhard's flagship but is unable to penetrate the battle line. Both sides withdraw.

While commemorating a cemetery to the Imperial war fleet, an assassination attempt is made on Reinhard. It is revealed that the assassin's family was killed in the nuclear strike on Westerland during the Lippstadt conflict. Reinhard is shaken to the core by his own guilt and inaction during that time. Reinhard asks Hildegard to spend the night with him. The next morning Hildegard goes home to her estate flustered. Reinhard visits the Mariendorf estate, asking for Hilde's hand in marriage. Hildegard is unsure of his feelings towards her, thinking his actions may be due to Reinhard's own sense of obligation.

Julian, Poplan, and the remaining Rosen Ritter soldiers return to Iserlohn. The setting is mixed, a truce was given but the Julian fleet lost many important members. Julian and Kate decide to officially have a dating relationship. Both the Reinhard and Julian fleets arrive on Heinessen. Rubinsky kills himself in the hospital, setting off multiple bombs under Heinessenpolis tied to his brain waves. Reinhard and Julian discuss the next steps politically. It is agreed that Heinessen and its surrounding systems are to be given autonomy for the ownership of Iserlohn. They consider setting up a constitution for the Empire. Both Julian and Reinhard's staff prepare to leave to Phezzan.

Yang organizes his fleet for a blitzkrieg directly at Reinhard's flagship, the Brunhilde. Reinhard divides his fleet into multiple layers of ships, providing an rotation for each broken layer. Ivan Konev is killed in battle when his strike craft is lured into cruiser fire. Yang realizes that it has become an issue of endurance if Reinhard's fleet is continuously reforming the front line. The Alliance fleet tricks Reinhard's front line into entering an asteroid field. Reinhard is divided from his main force as that group is surrounded by Yang's fleet. Müller's fleet is the first to return, rescuing the Brunhilde and acting as a shield.

All military campaigns for both the Alliance and Empire are put on hold to celebrate the new year. Admiral Lutz starts receiving multiple conflicting launch and Iserlohn defense orders. Reinhard is furious at Lutz's refusal to launch. Lutz finally launches with all his forces, hoping to sandwich the El Facil fleet between him and Thor's Hammer. The Rosen Ritter disable the Thor's Hammer with a previously encoded computer lock down code. The enemy infantry forces are superior in numbers, but not in skill or morale. The Rossen Ritter eventually enter a backup control room and fire the Hammer at Lutz's returning fleet. January 14th, 800 S.C. / 2 N.I.C.: Iserlohn is once again under Yang's control.

Reuenthal plans to divide up his fleet into a formation which would surround incoming fleets. Mittermeyer arrives first, quickly attacking before Reuenthal tactical plans are set up. Mittermeyer uses quick fleet movement to prolong the battle and limit casualties. Over time, Bittenfeld and Wahlen's fleets arrive as well. Wahlen is nearly killed and loses his artificial arm. Bittenfeld's fleet formation is unstable due to it being 1/2 survivors from his fleet and the remainders Fahrenheit's fleet. Admiral Knapfstein is killed in battle. Eventually the battle becomes a war of attrition. As it is reported that Mecklinger is approaching the battlefield in the Rantemario system, Reuenthal orders a hasty retreat.

Paul von Oberstein, chief of staff of the Iserlohn fleet, is in trouble. He saw through Yang's plan, but his commander didn't listen to him, and he fled before the destruction of the fleet. The three chiefs of the Imperial fleet resign, but want to make him responsible of the defeat. Oberstein meets Reinhard and explains how, like him, he hates the high nobles and the Goldenbaum dynasty, and offer his help. Reinhard agrees and obtains his pardon by advising the Emperor to refuse the chiefs' resignations.

Thirty years ago, marquis Klopstock was exiled form the imperial court. He asks prince Braunschweig, the Emperor's son-in-law, to ask forgiveness on his behalf. Braunschweig invites him to his daughter's birthday party. Klopstock's real goal is to bring a bomb in order to kill the Emperor, who will be there. At the party, Reinhard clashes with baron Flegel. The bomb is taken away by accident and makes little damage. Klopstock commits suicide and all the incident is kept secret.

Yang is sent to Thernussen (Heinessen's second largest city) with his ward, Julian Minci, to attend a ceremony at the Military Academy. He meets Jessica Edwards, who is campaigning for the Peace Party candidate in an upcoming election. We learn that Yang, while being loyal to democracy, has no love for the current politicians. The P.K.C. sets a bomb in the Peace Party's headquarters, killing the candidate, but their plan backfires when Jessica, who is the new Peace Party candidate, wins a landslide victory.

End of the battle of Amlitzer: Yang's 13th Fleet keeps the Imperial Fleet at bay, allowing admiral Bucock to withdraw the remaining fleets. After that, Yang manages to escape destruction (once again). Meanwhile, the Emperor dies without appointing an heir. Reinhard teams up with premier Lichtenlade in order to crown Erwin Josef II, one of the late emperor's three grandchildren. Prince Braunschweig and marquis Littenheim, fathers of the two others, prepare to seek revenge. Back in the Free Planets Alliance, Trüniht is appointed temporary chairman of the High Council, Bucock commander-in-chief of the Fleet, and Yang commander of Iserlohn. he takes all his staff with him, plus Attenborough and a new officer, Julian Minci, and hopes to have Alex Cazellnu appointed as commissioner of the fortress. Meanwhile, in Phezzan, Rubinsky takes his orders from the Grand Bishop of the Earth Cult.

Julian Minci asks Frederica Greenhill how Yang became the "Hero of El Facil": 9 years ago. The Free Planets Alliance fleet, led by Arthur Lynch, fled the approaching Imperial Fleet, leaving 3 million people behind; Yang, one of the few officers left, organized the evacuation while the Alliance Fleet was defeated. Meanwhile, in the Empire, Reinhard thinks a civil war is about to break out; in order to avoid an intervention form the Alliance, he decides to infiltrate Lynch in the Alliance to stage a military coup. The move is hidden behind an exchange of 2 million prisoners of war. End of 796 S.C. / 487 I.C.

Prince Brauschweig and marquis Littenheim team up to overthrow the young Emperor and get rid of Reinhard. Count Franz von Mariendorf wants to join the conspiracy, but his daughter, Hildegard persuade him not to do so because a new order is rising under Reinhard. She goes to Reinhard and offer her family's allegiance. The high nobles create the Lippstadt League, led by Braunschweig and Littenheim; admiral von Merkatz agrees (although reluctantly) to command their military forces. April, 6, 797 S.C. / 488 I.C.: Reinhard strikes first and manages to arrest many conspirators, but Brauschweig and Littenheim flee and regroup most of their forces in the Geiesburg Fortress.

Yang announces R&R time before the final battle. Julian and Yang discuss the differing battle goals for both sides. The Alliance needs to kill Reinhard while the Empire needs to hold out long enough for reinforcements to trap the Alliance. Yang finally reciprocates Frederica's feelings and proposes marriage after the war is over. Frederica is thrilled at the idea. It is revealed that Yang felt a large amount of guilt at pursuing familial happiness with all the deaths he has caused. Both fleets engage each other cautiously; both sides suspect traps or tricks from the other.

Yang's fleet nears firing range of the Brunhilde, but a message from Heinessen declares a ceasefire. During the battle of Vermillion, Hildegard had convinced Mittermeyer fleet to take Heinessen. Hildegard is wary of Reuenthal's ambitions, but has Mittermeyer convince Reuenthal to join the Heinessen attack. In Hildegard's judgement, the battle of Vermillion would have concluded in Reinhard's death before the other fleets could return in time. Trüniht plans to surrender, while the other members of the Alliance government would prefer to fight and die. During the meeting, armed Earth Cult members rescue Trüniht. The surrender of the Alliance has divided Yang's staff, some preferring to ignore orders and kill Reinhard while others grudgingly accept the ceasefire. It is decided that a portion of Yang's staff will escape with Admiral Merkatz to a life of piracy.