Go in the building in the middle of town to meet Dr Kirmo, Lexis' friend. "What kinda greeting is that?"

Your guys will discuss remodeling your ship. The elf stole the plans though... go after her.

Tough puzzle #1. Go here for the solution

Tough puzzle #2. Go here for the solution

She'll be attacked though. You have no choice but to save her. The 4 gargoyles aren't hard. They have about 1000 HP each and can score from 30-100 points of damage. Be sure to unequip Lexis of all his good irreplaceable stuff before the fight (though it'll be a bit harder)

The elf will be ungrateful, this man will appear.

She'll tell you why she stole the plans : the labs release ooze and pollute the environment. Lexis will leave your party to go fix your problem.

Bad news. Amon's causing more trouble.

This has no relevance, I just felt like pointing out one of the errors the makers made. You'll be warped to Eserikto, the elf town.