WARNING: SPOILERS AHEAD!!!

Your primary purpose in this section is to meet up with Gorion's friends Jaheira and Khalid, who can be found inside the Inn itself.

Outside:

Joia: Directly inside and to the left of the entrance to the Inn is a house where you can find Joia. She has a rather abrupt manner, but she asked you to retrieve her Flamedance Ring that was stolen by the hobgoblins. The only reward for returning the ring is 400 experience points and a +1 Reputation increase. She will leave the house however and you can search it for some additional stuff.

First Floor:

Khalid and Jaheira: On the first floor near the bar you will meet with the 2 friends mentioned in the letter you found on Gorion. Khalid and Jaheira asked to join forces and travel to Nashkel to look into the trouble in the mines.

Second Floor:

Unshey: A dwarven cleric who has suffered the loss of his Girdle of Piercing by some ogres that can be found at the Crossroads South of the Friendly Arm. You can either return the girdle to him for 800 experience points and 70 gold pieces or you can hang onto it for your own use.

Third Floor:

Landrin: Landrin is a gnome who has been forced to evacuate her house in Beregost due to a nasty spider infestation. She askes you to take care of it for her and to bring her the body of the largest spider as proof the task is done. (If you search her house, you will also find some boots and a botthle of wine that you can bring her for extra points and gold.) You will have to offer her the items one at a time, for which she will give you 125 gold pieces for each item and a total of 800 experience points.

Nobleman: A lone nobleman gives you his Golden Pantaloons and asked that you have them cleaned. If you return them to him, you get 100 experience points, but if you hang onto them, you can eventually use them in Baldur's Gate 2, the Throne of Bhaal expansion.

Assassins: A magic user by the name of Tarnesh attacks you right outside of the inn. If you allow him to attack you while there are Friendly Arm guards around, then you can quickly dispose of him with a reward of 120 experience points, 58 gold pieces and Magic Missile, Armor and Burning Hands scrolls.