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The British look around them and see that their island is falling apart. The initial invasion destroyed large amounts of infrastructure and the civil war isn't helping. So they invite the German War ministry to peace talks and offer a Nazi-aligned(ish) government in exchange for a truce. The Germans say yes to the proposal, however, they have one demand of their own.
What is the demand of the Germans?
- That the British join the Axis.
- That the Nazies get to train the British army.
- That Scotland, Northern Ireland and Wales become independent Nazi states.
- That the British agree to be incorporated into the Reich at some later time.