D&D 5E Need advice on how to rationalize terms of surrender to a beholder...

[Klaudius Rex]

Does the party have any warning that their friend might be going mad? If you didn't drop any hints before they left, I'd recommend you do so before springing this on them.

Good point.

They have know that the Demonlords are on the loose and spreading madness everywhere. Fraz-Urb'Luu the demonlord of deceit, has been wreaking havoc on the nearby outpost of Mantol Dertih, where the characters are currently stationed. I must confess that i also thought it would be fun to allow the characters to have their much anticipated rematch against Xazax the Eyemonger beholder, by egging them on---I told them that Lorthuun, the friendly beholder that is allied with the characters, left Mantol Derith alone, lost in a trance, and uttering strange things like "the eye surgery is going to go well...the eye surgery is going to go well..." on and on. So, the players know that something went awry with him.

Xazax the Eyemonger and his deep gnome surgeon, Peebles, have been spying on Lorthuun mainly because Xazax is obsessed with taking the eyestalks from other beholders (like Lorthuun), and surgically grafting them onto his body. So in the first fight against Xazax, they were really trying to assault Xazax for plotting to kill their ally, Lorthuun. They lost that first match, and Xazax let them go, demanding that they come back with Lorthuun's eyestalks. They of course did no such thing, and instead, brought a larger force to for a rematch against Xazax, and still lost with 3 out of 6 players dead. So at this point, they are heading back essentially with their tails between their legs....

...only to find out that Lorthuun never left, affected by the madness, and attacks them. Id most likely have Lorthuun's madness convince him that he heard and believes the voices (Fraz-Urb'Luu, the demonlord) that the players are out to kill him.

If it goes down like this, the players will get yet a third chance to defeat a beholder (which is always fun in D&D), albeit at the price of killing their ally, Lorthuun. I will most likely try to create a nerfed, challenge appropriate beholder since the options in the Monster Manuel only give CR3 and CR13 beholders. There's got to be something in between that for a lv8 party.

What do you think?