We need more help if we are going to take down Clyde.

The Stick of Truth Don't gaze at it too long!

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Go to Kyle's house and head to the Elven Kingdom in the backyard. He will go over what they are facing at Clyde's Fortress, and tell you to go get the girls' help. Go to City Hall and talk to Annie Nelson. This is another multi-part quest. Walkthrough continues at Recruit the Girls.