Strange.
 

Hmm... Well I have a quest that im not sure about. I need 12 mercenaries from kingshead. I cant find any mercenaries.. in Kingshead.

I think they're all in the very top fort way above everything else, iys quite a trek to get up there.

They are near the back of Kingshead. In the fort at the top.

Aye, what they've said. Weren't we there yesterday? It's up near the jail. Anywho, I think you sometimes need to kill off some hired guns or assassins to get some spawning. I can show ya later if you'd like.

Yep, go to the top of the castle and there are usually two or threee up there. If not, kill off any assassins yuo find and just keep at it, the Mercenaries will eventually spawn at the assassin location. Takes time but really does bump up your reps :)