An army of hobgoblins devastates the dwarf Duchy of Hunnabar, which is centered above the underground city of Kanaglym near present-day Dragonspear Castle. Phalorm's armies destroy the hobgoblins, but the elf king, Ruardh Lightshiver, is slain. »
The famed adventurer Daeros Dragonspear seizes a fortune in gems from a beholder lairing in the lost, subterranean city of Kanaglym, in the depths of what was once Phalorm's Duchy of Hunnabar, and decides to retire. The bearded half-dwarf chooses the lair of the copper dragon Halatathlaer as the site of his castle. Dwarves are welcomed at Dragonspear Castle, and soon the outer ward fills with small stone cottages and delvings beneath them. »