NOTICE OF EXTRAORDINARY GENERAL MEETING IN KARO BIO AB (PUBL)

Shareholders in Karo Bio AB (publ) are hereby called to an extraordinary general
meeting on Wednesday, March 16, 2016 at 3:00 p.m. at Karo Bio’s offices at Novum
Research Park (level 8, elevator E), Hälsovägen 7 in Huddinge

Right to attend

Entitled to attend the extraordinary general meeting are those who are both
registered shareholders in the share register held by Euroclear Sweden AB at the
record date March 10, 2016 and have given notification to the company of their
intention to attend the extraordinary meeting not later than March 10, 2016, at
4.00 p.m.

Shareholders with nominee-registered shares must temporarily register their
shares in their own name with Euroclear Sweden to attend the meeting. Such
registration must be completed by March 10, 2016 and should be requested well in
advance to this date to the nominee of the shares.

Notification to attend

Notification to attend the meeting shall be submitted in writing to the address
Karo Bio AB, att: Henrik Palm, Novum, SE-141 57 Huddinge, Sweden, or by email to
henrik.palm@karobio.se. Name, personal identification number or corporate
identity number, phone number and number of shares held shall be included in the
notification to attend. Where applicable, the number of advisors (maximum two)
shall be stated. If a shareholder intends to be represented by proxy, power of
attorney and other authorization documents should be attached to the
notification. The original authorization documents must be able to be presented
at the meeting. Proxy forms are available from the company, at the company’s
website and will be sent to shareholders who provide their postal address.

Proposal for Agenda

 1. Opening of the meeting
 2. Election of chairman of the meeting
 3. Preparation and approval of the voting list
 4. Approval of the agenda
 5. Election of persons to confirm the minutes
 6. Determination as to whether the meeting has been duly convened
 7. Resolution on amendment of the articles of association
 8. Approval of the Board’s resolution on a new share issue (rights issue)
 9. Resolution on the authorization of the Board to resolve on a new share issue
at an over-subscription (over-allotment option)
10. Closing

Proposals of the Board

Item 7 – amendment of the articles of association issue

The Board proposes that Extraordinary General Meeting resolve to amend the
limits of the share capital in the Articles of Association from the current
minimum of SEK 5,000,000 and maximum of SEK 20,000,000 to the minimum of SEK
10,000,000 and maximum of SEK 40,000,000. Paragraph 4 of the Articles of
Association will accordingly have the following wording:

“The share capital shall comprise a minimum of SEK 10,000,000 and a maximum of
SEK 40,000,000."

The Board also proposes a name change from Karo Bio AB (publ) to Karo Pharma AB
(publ). The purpose is to give the company a name that better reflects the
combination of operational projects and sale of products on the market.

The Board of Directors proposes that the Articles of Association § 8 is changed,
by removing "16.00" .

A valid resolution in accordance with the Board’s proposal requires the support
of shareholders holding at least two-thirds of both the votes cast and the
shares represented at the Meeting.

Item 8 – Rights issue

The Board proposes that the meeting approves the resolution by the Board on
February 11, 2016 on a rights issue with preferential rights for the
shareholders in order to provide the company with rights issue proceeds
amounting to approx. MSEK 250 on the following terms.

The share capital shall be increased by a maximum of SEK 4 992 520,47 by the
issuance of a maximum of 12 481 439 new shares. The new shares shall be
subscribed for with preferential rights for the company’s shareholders in
proportion to the number of shares previously held, whereby four (4) existing
shares entitle to subscription for one (1) new share. The subscription price for
each new share shall be SEK 20.00.

The record date for the determination of which shareholders are entitled to
subscribe for new shares with preferential rights shall be March 23, 2016.
Subscription for new shares shall take place during the period from March 29,
2016 up to and including April 12, 2016, or such later date to be decided by the
Board. Subscription for shares by the exercise of subscription rights shall be
made by simultaneous cash payment. Subscription for shares without exercising
subscription rights shall be made on a separate subscription list and be paid in
cash within three (3) business days from the date when notice of allotment by
the Board has been sent to the subscriber, or such later date as the Board may
decide.

In the event that not all shares are subscribed for by the exercise of
subscription rights, the Board shall decide on allotment of shares without the
exercise of subscription rights up to the maximum amount of the rights issue.
Such allotment shall be made, firstly, to those who have subscribed for shares
by exercising subscription rights and who wish to subscribe for additional
shares, pro rata in proportion to their subscription by exercising subscription
rights, secondly, to others who have notified their interest to subscribe for
shares without exercising subscription rights, pro rata in proportion to their
subscription and, thirdly, to those who have guaranteed subscription for shares
pro rata in proportion to provided guarantees. For practical reasons, when
resolving on allotment, the Board may resolve that the above-mentioned allotment
will be made of a certain minimum number of shares only.

A valid resolution requires the support of shareholders with more than half of
the votes cast.

Item 9 – Over-allotment option

In order to meet a possible over-subscription in the rights issue, the Board
proposes that the Board within thirty days from the last subscription date in
the rights issue (however, not later than May 12, 2016), is authorized to
resolve on a new share issue of additionally in total 1,500,000 shares at an
subscription price of SEK 20.00 per share in order to enable that the company is
provided with additional rights issue proceeds of MSEK 30. At full subscription
of the rights issue, the over-allotment option is equivalent to approximately
2.4% of the share capital.

The reason for deviating from the shareholders’ preferential right is to provide
the company with additional rights issue proceeds at a possible over
-subscription of the rights issue (a so-called over-allotment option) and to be
able to increase the number of shareholders of the company. The new share issue
can take place without the preferential rights of the company’s shareholders in
accordance with the principles of allotment applicable to the rights issue.

A valid resolution requires the support of shareholders representing at least
two-thirds of the votes cast and the number of shares represented at the
meeting.

Available documents and information

The Board’s complete proposal and resolutions, respectively, together with other
documents in accordance with the Swedish Companies Act will be available at the
company and on the company’s website www.karobio.se as from February 24, 2016 at
the latest. Copies of the documents will be sent free of charge to shareholders
who so request and state their address.

Shareholders at the meeting are entitled to ask questions concerning the matters
to be dealt with at the meeting.

Number of shares and votes in the company

At the time of issue of this notice, the total number of shares and votes in the
company was 49,925,755. The company holds no treasury shares.

Huddinge in February 2016

Karo Bio AB (publ)

The Board of Directors


Karo Bio publishes this information according to the Swedish Securities Market
Act and/or the Swedish Financial Instruments Trading Act. The information was
submitted for publication on February 12, 2016, at 8.30 a.m. CET.