When you go all the way west from Exile (the city),there will be another city surrounded by water on the west andeast sides. Go all the way to the north and there will be a whitedot. Go over it. It will be a corpse. Take the ax.
In Formello (north of starting area, has a few bridgesnear it), there is a locked building next to the church. Use themage spell Unlock or Picklocks, or bash open the first door. Usethe same technique on the second locked door. Once through, searcharound the walls for a hidden door on the right side of room.There are four or five separate white encounter dots. Watch out-- do not proceed unless you have a high amount of health anda cleric in your party. The two dots readily accessible to you(one above, one below) are traps. Disarm them, then go on to thenext dot, in whichever direction chosen. The north one is allof the town's money. If you are well off and have moral issueswith stealing the hard working people's cash, then skip this one.When you land on it you will set off a previously unseen unstoppabletrap that will soak up some life and poison your leader. The samehappens with the one to the south. To the south you will get aNecklace Of Lifesaving. Also in the town is a nervous lady takingcare of the cows to the south. Unlock the door and search aroundthe southern walls. You can find a hidden door on the southeastarea of the wall.