Orphen (1998)

Orphen finds himself living in a quiet town and taking on a student - Majic Lin, his landlord's son. Life is quiet and fairly lazy until the day Cleao Everlasting comes home from boarding school, and stumbles into Orphen's quietly laid plans for the sword that sits on her family's mantle: the Sword Of Baltanders. It turns out that the sword is actually one of three magical artifacts that Orphen will need if he is to save Azalie, and, in fact, was the very sword Azalie used in her experiment that ended with her unfortunate transformation. Before he can obtain it, however, the Bloody August assaults the town looking for the sword. To find the other Baltander's relics, Orphen sets off with his apprentice, little miss Everlasting and two short-statured misfits.