England and the Dutch Republic are also invested in the Baltic Sea trade, and pressured to curtail Denmark's power by ending the Kalmar War before a decisive victory could be attained.

The Danes, while well-equipped and strong, have relied heavily on mercenary forces and Christian IV, low on funds, is finally amenable to persuasion in 1613.

With the intercession of England’s James I, the Treaty of Knäred is signed on January 20, 1613.

Denmark has reached its goal, restoring Norwegian control of Sweden's land route through Lapland by incorporating Lapland into Norway (and thus under Danish rule).

Further, Sweden has to pay a high ransom for two fortresses, one of them Alsborg, captured by Denmark (this will take six years to accomplish).

Sweden, however, achieves a major concession—the right of free trade through the Sound Strait, becoming exempt of the Sound toll (a right shared by Britain and Holland).