Torch of Holy Flame

Torch of Holy Flame is a off-hand item. It gives bonuses to spirit and spell power. Sven Yorgen sends adventurers to forge a weapon capable of defeating Morbent Fel. Lightforge Ingots salvaged from the sunken elven destroyer, the Flying Osprey, are used in its creation. Morbent's Bane is another name for it during the quest to kill Morbent Fel.

At some point following Morbent Fel's death, the torch was broken and its pieces scattered throughout the Dawning Wood Catacombs. After it was reassembled, it was used once again to kill Morbent Fel who had returned as a lich.

Following Morbent Fel's second defeat, the Torch of Holy Flame has been placed by Commander Ladimore in front of the necromancer's home to dispel dark enchantments and keep the undead docile in the cemetery.

Some time after the Fourth War, a necromancer came to steal and corrupt the holy torch, before being stopped by Mathias Shaw and Flynn Fairwind who brought the holy torch back after purifying it in a moonwell of the Twilight Grove, bringing calm to the region and make the undead docile again.

Source
This item was a reward from Morbent Fel (quest).