After unintentionally insulting the king, Karl was banished from his homeland when he was just a boy. He would only be allowed to return if he completed an impossible task: find a dragon, tame it, and bring it to the king.
He traveled far across the ocean in his search (which is where he picked up the samurai aesthetic) and after years of searching, he found a huge gem-like dragon egg. But when he returned he found his homeland in ruin. Soon after his return, the egg hatched, and so he took up adventuring so he could afford to feed his new pet dragon. The two have been on many adventures since then, and Karl sees Malsogaal almost as his adopted son. The two are inseparable.
Additionally, in his adventures with Malsogaal, Karl was given a magical sword by a wizard smith. Its blade is invisible, that is, until it draws blood.