You continue to follow Palehorn’s wooden medallion deeper into the mountain. As you round a corner you see a Kobold locking away some sort of treasure in a chest. He then slips into a pile of rubble through which small creatures can pass, but not medium ones without a squeeze.
As you approach, you soon find yourselves surrounded by Dragonkin Kobolds and Kobold minions. Their magic continually dazes you, making fighting them off difficult.
Eventually you defeat them and use their hiding holes as s place to take an extended rest.