Notice for the Special Shareholders' Meeting - Karo Bio

Notice of Extraordinary General Meeting ofthe Shareholders of Karo Bio AktiebolagAn extraordinary general meeting of the shareholders of Karo Bio Aktiebolag (publ) willbe held on Friday October 14, 2005 at 1.00 p.m. at Näringslivets Hus, Storgatan 19,Stockholm, Sweden.I. RIGHT TO PARTICIPATE, NOTIFICATIONShareholders who wish to participate in the general meeting must be recorded in the shareregister kept by the Swedish Securities Register Centre (VPC AB) by Tuesday October 4,2005 and, further, must notify the company of their intention to participate in the meetingby no later than Monday October 10, 2005 at 4.00 p.m.Notification should be made in writing to Karo Bio AB, att: Eva Kruse, Novum,SE-141 57 Huddinge, Sweden, by fax + 46 8 774 52 80, or by e-mail tosgm@karobio.com. Notification can also be made on the company’s web sitewww.karobio.com/sgm. When notifying, the shareholders should state name,personal/corporate identity number (where applicable), address, telephone number ande-mail address. In the case of representatives participating in the meeting, proof of dueauthorization should be forwarded to the company in conjunction with the notification.One or two advisors may accompany a shareholder to the meeting, provided that theshareholder gives notice as to the number of such advisors.Shareholders whose shares are registered under the name of a nominee must temporarilyregister their shares in their own names to be entitled to participate in the meeting. Suchregistration must be in effect at the Swedish Securities Register Centre (VPC AB) no laterthan Tuesday October 4, 2005, which means that shareholders must notify their nomineewell in advance of that date.II.PROPOSED AGENDA1. Opening of the meeting2. Election of chairman at the meeting3. Preparation and approval of the voting list4. Approval of the agenda5. Election of persons to confirm the minutes6. The determination as to whether the meeting has been duly convened7. Resolution to approve the Board’s decision to issue new shares withpreferential rights for the shareholders8. Closing of the meeting.

f specified style indocument.2(2)III.PROPOSED RESOLUTIONSItem 7: Resolution to approve the Board’s decision to issue new shares withpreferential rights for the shareholdersOn September 28, 2005 the Board resolved – subject to the approval of the general meeting– that the share capital of the company shall increase by not more than SEK 92 895 354 byway of a new share issue of not more than 46 447 677 shares, each with a nominal value ofSEK 2. The shareholders shall have preferential rights to subscribe for the new shares. Foreach new share, payment of SEK 6 shall be made in cash. Each existing share entitles tothree subscription rights. Two subscription rights entitles to subscription of one new share.Subscription of shares on the basis of subscription rights shall be made by way ofsimultaneous cash payment during the period from and including October 27, 2005 up toand including November 10, 2005, with a right for the Board to extend the subscriptionperiod. Record date for the new share issue, on which shareholders shall be recorded inorder to be entitled to participate in the new share issue with preferential right, shall beOctober 24, 2005.Shares that have not been subscribed for with subscription rights shall be allotted by theBoard of Directors in its own discretion within the limits set by the highest amount of thenew share issue, whereby priority shall be given to those who have subscribed for shareson the basis of subscription rights. Shares that have not been subscribed for withsubscription rights shall be subscribed for on a special subscription form and be paid incash within three (3) banking days from the day when the allotment decision of the Boardhas been sent to the subscriber. The Board has a right to extend the time for payment.If full subscription is made on the basis of the company’s warrants 2001/2008 and2003/2011:A-D, the resolution shall be deemed to mean that the company’s share capitalshall be increased by an additional amount of not more than SEK 2 131 110 by way of anew share issue of not more than 1 065 555 additional new shares.IV.DOCUMENTSThe Board’s resolution under item 7 above in its entirety as well as documents inaccordance with Chapter 4 Section 4 of the Swedish Companies Act will be available atthe company’s offices in Huddinge and on the company’s web site www.karobio.com/sgmfrom October 7, 2005. Copies of all documents will be sent to shareholders that so requestand state their address or e-mail address. Copies of all documents will be available at thegeneral meeting.____________Huddinge in September 2005Karo Bio Aktiebolag (publ)The Board of Directors