The Finnish government received the first tentative peace conditions from the Soviet Union (through Stockholm) on 31 January 1940. By this point, the regime had greater claims before the start of the war. The demands were that Finland cede the Karelian Isthmus, including the city of Viipuri, and Finland's shore of Lake Ladoga. The Hanko Peninsula was to be leased to the Soviet Union for 30 years.
Finland rejected these demands and intensified its pleas to Sweden, France and the United Kingdom for military support by regular troops. The reports from the front still held out hope for Finland, anticipating a League of Nations intervention. Positive signals, however inconstant, from France and Britain, and more realistic expectations of troops from Sweden, for which plans and preparations had been made all through the 1930s, were further reasons for Finland not to rush into peace negotiations. (See Winter War § Foreign support for a detailed account.)
In February 1940, Finland's Commander-in-Chief marshal Mannerheim expressed his pessimism about the military situation, prompting the government to start peace negotiations on 29 February, the same day the Red Army commenced an attack against Viipuri (now Vyborg).
On 6 March, a Finnish delegation led by Prime Minister Risto Ryti travelled to Moscow. During the negotiations, the Red Army broke through the Finnish defence lines around Tali and were close to surrounding Viipuri.
The Peace Agreement was signed on the evening of 12 March, Moscow Time, i.e. 1 hour on March 13, Finnish time. The protocol appended to the treaty stipulated that the fighting should be ended at noon, Leningrad time (11:00 Finnish time), and the fighting continued until that time.