Algashon Nathaire, a powerful mystic theurge (cleric / mage) of Bane, befriends Sammaster (in or near Baldur's Gate) and the two begin to work together. Algashon sought to turn Sammaster away from Mystra and thereby steal for the Black Lord the secret of Mystra's silver fire.
Through the years together, Algashon whispers turn Sammaster toward bitterness, resentment, and evil. »
Algashon coerces Sammaster to attack Alustriel, intending to steal her silver fire through a vile ceremony while she was at a disadvantage. However, Alustriel called on Elminster and Laeral, and together the three Chosen killed Sammaster. Azuth then appears and strips Sammaster's body of its silver fire. After they depart, Algashon resurrects Sammaster who is now quietly mad but still blessed with long life and the ability to heal quickly.
In the years that follow, Sammaster draws on his own translation of Maglas's prophecy, Algashon's whisperings, and ancient tomes unearthed from ruins beneath the Anauroch and Raurin deserts. Sammaster and Algashon founded the first Dragon Cult cell in the city of Chondathan (now the Sembian city of Saerloon) and set about creating all manner of draconic undead. »
With Sammaster's apparent downfall, it leads to the first schism among the Followers of the Scaly Way - some followers remain loyal to the memory of the First Speaker and continue to operate openly, while others followed Algashon into secrecy and exile, first to Urmlaspyr and then west and north into the Western Heartlands and the North. Most cells are eventually forced by their enemies to follow Algashon into hiding or face extinction. This allows Algashon to return to Sembia and becomes the first of the Wearers of Purple. However, Algashon's view of the organization as primarily religious, commanding obedience to the Sacred Ones and Bane, soon clashed with the beliefs of the more pragmatic adherents, who saw the Dragon Cult as a means to further their own personal power. In time, the latter group found a leader in the archmage Tuelhalva Drakewings, but open skirmishing between the two sects soon force the Drakewings faction into hiding. »
After the recent defeat in Surkh, dissidents within the Cult of the Dragon begin to openly question Algashon's leadership and the weighty influence the church of Bane has had in Cult operations in the preceding years, with the mage Tuelhalva Drakewings becoming a particularly outspoken opponent of the god of tyranny's place in the Cult.
The Cult refocuses its efforts to expand in the North, creating at least 10 new cells in this time period. The only known failure of the Cult to infiltrate an area during this era is in Silverymoon. »
Factionalism within the Cult increases with most members joining either Algashon Nathaire's reformational Baneinfluenced camp or Tuelhalva Drakewings' pragmatic faction. »
Tuelhalva is sent south to Peleveran, a kingdom built along the Landrise of the Shaar, to investigate reports of an ancient undead dragon lurking in the catacombs beneath the capital city of Peleveria. Although he finds no dragons, Tuelhalva discovers the gathering evil of Gargauth and sees in the exiled archdevil the opportunity to break from the Sembian cell of the Dragon Cult and its Banite (Algashon) leadership.
Factionalism among the Cult causes most to join (reformational Bane-influenced) Algashon or (the pragmatic) Tuelhalva Drakewings. »
The Cult of the Dragon establishes a cell in Mourktar by a follower of Algashon. The Mourktar Cell achieves early success by convincing Alasklerbanbastos to embrace dracolichdom in the wake of Tchazzar's apparent ascension to divinity. »
Tuelhalva summons an avatar of Gargauth to the Realms and calls for like-minded pragmatic Cult of the Dragon members in Sembia to join them in Peleveran and form a new cell far from the influence of Algashon. With the help of Gargauth, Tuelhalva quickly conquers the realm of Peleveran (located south of Chessenta). Gargauth betrays Tuelhalva by whispering words of their success to Algashon. The Banite priest musters an army of dragons, dracoliches and Cult members to destroy them. Both Algashon and Tuelhalva are slain.
Because this battle unfolds during a continent-wide Rage of Dragons, few scholars realizes the destruction of Peleveran was the result of an interfactional battle within the Cult of the Dragon and not simply the larger Dracorage. »