The Pack concluded that Klavdiya was not the source of the children's suffering; Felix was the culprit, invoking some evil power through his tin locket. Shakti found evidence in his room suggesting that the boy had killed Zaharia by throwing him from the window. They found Felix alone in the orphanage's dark attic, carving a wooden doll with a large kitchen knife. Ghalwin attempted to engage with him, but it became slowly apparent that another being was speaking through the boy.
The window's light blackened, the trapdoor slammed shut, and a Shadow Fiend tore free from Felix's body as he fell unconscious. In pure darkness, only Shakti could see the Demon, and the druid trained her moonbeam wherever it skittered along the walls and ceiling. The radiance burned the creature and released acrid smoke, but also began compromising the roof's structural integrity. The demon darted at Jarmo and carved through him with long smoky claws; the blood hunter could only save himself by invoking his stoneskin for the fourth time.
Desperate to track the fiend, Ghalwin turned to the Eye of Darkness and claimed her power, gaining temporary darkvision. He had Jarmo fling him upward as they had done in their boyhood, and smited the shadow demon mid-air in an absolutely Certified Anime Moment. The creature somehow the blow, however, and Ghalwin hit the ground then was scorched by his sister's moonbeam for his trouble. The fiend then dropped from the ceiling, drained much of Shakti's life, and repossessed Felix. Ghalwin healed his sister while Jarmo swung wide and blew a hole clean through the attic floor.
Felix stabbed Ireena before the group tackled him. The demon slipped into the bag of holding, retreated to its locket, and possessed the last person to have touched it: Ghalwin. The possessed paladin slashed at Ireena and made a break for it, but Shakti and Jarmo ran him down and knocked him out. Ireena carried Felix downstairs to the Headmistress while Shakti tended to her unconscious brother, with the demon remaining trapped in the locket. After a brief pause, Jarmo destroyed the trinket, and Ghalwin finally smote the demon as it re-emerged.
Killing the demon lifted its hold over Milivoj. The Pack revived him with one of the healing potions at his bedside and, over a short rest, heard his confession. He told them he had previously been approached by the coffin-maker Henrik van der Voort to steal Saint Andral's bones, and had initially refused. But when his illness worsened and he could no longer support the orphanage, desperation won out. He learned from Yeska where the bones were buried, plundered the tomb, and attempted to sell them to Henrik for seventy gold pieces; however, sicknness overtook him before the exchange was completed. In thanks for healing Milivoj and resolving the matter of Felix's possession, Headmistress Klavdiya gave the Pack her last remaining potion. She had acquired it from the Martikovs, who themselves purchased it from a hag north of Lake Zarovich, Jeny Greenteeth.
Deciding it was urgent to recover the bones, the party set off to confront Henrik. They passed through the town square, where a large gallows stood surrounded by wooden stockades. Men, women, and children sat in the stocks wearing plastered donkey heads and bearing various wounds. A group of guards led by a massive man with a devilish right arm moved through the square, and they heard whispers of his name: Izek Strazni. His guards tore down posters advertising the "Wolf's Head Jamboree" and replaced them with notices for an upcoming "Festival of the Blazing Sun".
The Pack kept their heads down and made for the Coffin Maker's Shop, which had been boarded up. Ghalwin sensed six undead presences on the second floor, but found the entrance locked. Henrik screamed at them to leave and refused all attempts at diplomacy; a frustrated Ghalwin smashed a window beside the side door. Shakti slithered through as a Wild Shaped snake and unbarred the door from within. Having committed to the break-in, they moved toward the stairs, but Henrik emerged and pleaded with them to go no further.
Everything the Pack had suspected was true; but Henrik was being held captive in his own home.