Database storage location
Standard, at single place installations (personal and standard edition) the database file should be stored in a directory, which is backed up regularly. For this purpose we suggest the "my documents" or "document" directory, provided that it is backed up regularly.
In order to use Password Safe together in a team, that means as a central Password Safe, there are different possibilities, according ot the edition.
Professional Edition (or Enterprise Edition without server)
Copy or create the databases (*.ps7) in a network share. Then all clients can set up a connection via the client to the databases in the network share, via set up database.
Enterprise Edition with Enterprise server
The database itself does not lie in the network share, because access can be built up per TCP/IP via an IP address of the server. Direct access to the database file is not intended here.