Thor, his full strength now restored, continues his battle against the Destroyer, completely unaware that the soul of his lover, Sif, is trapped inside the mystical armor. As the battle rages, Thor tosses his hammer at the Destroyer; however, the device grabs it and uses it against its owner. Before the Destroyer can do any more damage, it suddenly drops to the ground, lifeless, leaving Thor to look to Asgard for answers about the Destroyer's attack on him.

While in that fabled land, Odin watches over his son and surmises that the soul within the Destroyer was removed from its body, rendering it inert. This proves to be true, as Karnilla has restored Sif's soul to her body in the land of the Norns to get Balder to agree to battle Ulik on her behalf. With Balder's wishes complied with, the brave warrior engages in a battle against the strongest of the Rock Trolls.

As Balder's battle against Ulik rages on, Thor is suddenly transported to Asgard from Earth, leaving the New York police to deal with the Destroyer's armor. Thor finds himself transported into Karnilla's castle, where she begs Thor to help Balder in his fight against Ulik. Thor gladly steps into battle, his hated foe in Balder's stead, and the two are locked in a furious battle.

While back on Earth, the police have managed to bring the Destroyer armor to the local precinct, where they try and decide what to do with it. Odin arrives shortly after in a mortal guise and tricks the police into thinking that he is a curator from a local museum who comes to examine the device. However, when the police get a call advising them that the man from the museum is running late, they rush into the room too late and find that Odin has disappeared with the Destroyer armor.

Back in Asgard, the battle between Thor and Ulik rages on. Forgotten in the din of battle, Loki watches close by, hoping to seize an opportunity to defeat Thor once and for all. Although Ulik fights with savage fury, Thor's superior battle prowess wins that day, with Thor knocking Ulik into the Abyss of Shadows, where the Thunder God hopes the Rock Troll will never return.

As the others cheer Thor's victory, it's only when Sif embraces Thor that the Thunder God realizes that his hammer has been stolen from his belt. Horrified, Thor recognizes that Loki is the only person not present and accounted for in the battle's aftermath, and his arch-nemesis has his most prized weapon.

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