TEFRON LTD (The Company )

TEFRON LTD (The “Company”)

An Amended Immediate Report in accordance with the Securities Regulations (a Transaction between a Company and a Controlling Shareholder Therein), 2001, and in accordance with the Securities Regulations (Private Offering of Securities in a Listed Company), 2000, concerning the convening of an Extraordinary General Meeting of the shareholders of the Company

Name of the offerees and a concise description of the transaction and its principal terms:

On February 17, 2015, the Company signed an agreement with Litef Holdings Inc., a private company incorporated in Canada, who is among the controlling shareholders of the Company (hereinafter: "Litef"), according to which, Litef will invest a total of US 5 million dollars in the Company against an extraordinary private allocation of 4,672,897 ordinary shares of the Company of NIS 10 par value each (hereinafter: "Ordinary Shares") (hereinafter: the "Agreement"). The Company reported on the signing of the Agreement in an immediate report, on February 18, 2015, Reference No.: 2015-01-033661. On February 18, 2015, the Company's Board decided, pursuant to the approval of the Company's Audit Committee as at that day, to approve the engagement of the Company in the Agreement, which includes a transaction between the Company and Litef, as well as an allocation of shares to Litef, and all as detailed as follows.

On April 2, 2015, and pursuant to receiving the approval of the Company's Audit Committee and Board of Directors following their meetings dated April 1, 2015, the Company signed an agreement with Mazouz and Weisselberger Genesis Investment, Limited Partnership, Mr. Erez Rozenbuch and Mr. Tomer Hefetz (hereinafter: the "Additional Investors"), according to which at the closing date, each of the Additional Investors shall invest in the Company a sum of US 175,000 dollars, and in total a sum of US 525,000 dollars, against a private offering of 163,551 ordinary shares of the Company to each of the Additional Investors, and in total 490,653 ordinary shares (hereinafter: the "Additional Investment Agreement"), furthermore the Company signed on an amendment to the Agreement resulting from the Additional Investment Agreement. On May 18, 2015, the Company signed on an additional amendment to the Agreement resulting from the understandings the Company has reached with its financing banks. (hereinafter: the Agreement and the Additional Investment Agreement shall be called together" the "Private Offering").

The Private Offering is brought to the approval of General Meeting of the shareholders of the Company, for the following reasons:

a. The Private Offering is a transaction which includes an extraordinary private offering to Litef, who is among the controlling shareholders of the Company, and therefore it is brought for approval as an extraordinary transaction with a controlling shareholder in accordance with Section 270(4) and 275 of the Companies Law, 1999 (hereinafter: the "Companies Law ")1.

b. As at the date of the report, Litef and Nouvelle Intimes Seamless Inc., a private company incorporated in Canada (hereinafter: "Nouvelle") (Litef and Nouvelle shall be called hereinafter: "Nouvelle Group") jointly hold approximately 32.47% of the issued and paid up share capital of the Company and the voting rights therein and approximately 28.53% of the issued and paid up share capital of the Company and the voting rights therein on a fully diluted basis2. In the framework of the transaction, 4,672,897 Ordinary Shares of the Company shall be allocated to Litef, so that upon the closing of the transaction, the Nouvelle Group shall jointly hold approximately 57.71% of the issued and paid up share capital of the Company and the voting rights therein and approximately 53.53% of the issued and paid up share capital of the Company and the voting rights therein on a fully diluted basis. Since as at the date of this report, there is no other person who holds more than 45% of the issued and paid up share capital of the Company (regarding this matter, see the following paragraph entitled "Name of the controlling shareholder who has a personal interest and the nature of this matter"), the transaction is brought to the approval of the shareholders’ meeting of the Company also in accordance with Section 328(b)(1) of the Companies Law, as a private offering whose aim is to grant the shareholders of the Nouvelle Group more than 45% of the voting rights in the Company.

The principals of the Agreement and the Additional Investment Agreement:

The principals of the Agreement

As noted above, on February 17, 2015, the Company signed the Agreement. The principals of the Agreement are detailed as follows:

1. Litef shall invest a total of US 5 million dollars in the Company (hereinafter: the "Investment Amount") on the closing date (as this term is defined s follows), against the allocation of 4,672,897 Ordinary Shares of the Company, at a price of US 1.07 dollars per share. It is noted that the payment for each share is lower than its nominal value (NIS 10). Therefore, in accordance with Section 304(a) of the Companies Law, the Company shall convert part of its profits from premium on shares included in its equity as presented in the recent financial statements of the Company, into share capital, in an amount equal to the difference between the par value of each share issued (NIS 10), and the amount to be paid

1 For details regarding the controlling shareholders of the Company, as at this date, see below. 2 Calculation of the rate of holdings on a fully diluted basis was made as at April 2, 2015, excluding 99,740 ordinary shares of the Company held by a subsidiary of the Company and assuming the full exercise of the warrants (non-negotiable) to employees, consultants and officers of the Company as well as rights to shares, exercisable for 135,000 ordinary shares of the Company (after taking into account adjusting the amount to holders of option warrants due to the rights issue carried out by the Company in March 2010). for it (US 1.07 dollars). The calculation of the conversion of 10 NIS into US dollar will be carried out in accordance to the exchange rate of the US dollar, as listed at the time of the payment of the consideration.

2. Nouvelle and Messrs. Ben and Martin Lieberman, who are amongst the controlling shareholders of the Company, signed on 30 December 2010, a commitment not to compete with the Company in the field of seamless products for a limited period of 5 years as of the date of signing such non-competition letter of commitment, and all as detailed in the letter of commitment (hereinafter: the “Letter of Commitment”). In the framework of the Agreement it was agreed upon that Litef would join as a party to the Letter of Commitment and it will remain in force as long as Nouvelle, Messrs. Ben and Martin Lieberman, and Litef, each on its own, will be amongst the controlling shareholders of the Company.

The closing of the transaction has been set to a date no later than five business days after the fulfillment of all the conditions precedent as specified in the Agreement, including:

a. An approval, in accordance with the provisions of the law, of the Company’s engaging in the Agreement including an approval to allocate the shares in accordance to the Agreement by the Company’s Audit Committee and Board of Directors (who have granted their approval during their meeting on February 18, 2015), as well as by the meeting of the Company’s shareholders, that is convened according to this report, by a special majority pursuant to Section 275 of the Companies Law. It shall be noted that for the purpose of accompanying the negotiations with the controlling shareholder, the Company's Board has established a special and independent committee whose members are the members of the Audit Committee of the Company, and it has accompanied the negotiations with the controlling shareholder and approved the terms of the Agreement on February 12, 2015.

b. The approval of the Stock Exchange regarding the registration for trading of the shares to be allocated under the Agreement.

c. The Company's engagement with its financing banks, Bank Leumi Le-Israel Ltd., Bank Hapoalim Ltd. and Israel Discount Bank Ltd. (hereinafter: the "Banks") in an agreement to amend the existing financing agreement of the Company (hereinafter: the "Financing Agreement") regarding the following topics:

(1) Refinancing of the Company's long-term loans in the amount of sixteen million US dollars into long term loans with a repayment term of 10 8 years, which will be repaid in equal annual principal repayments as detailed as follows: a sum of US 1.7 million dollars in 2015, a sum of US 1.65 million dollars in each of the years as of 2016 and until 2022 (inclusive), and a repayment of US 2.75 million dollars in the first quarter of 2023. (2) Increasing the existing Banks' short-term credit lines (a credit line of 9.75 million US dollars) and increasing the agreed-upon amount of the factoring limits (a factoring limit of 2.5 million US dollars), in an amount equal to 150% of the Investment Amount (i.e. US 7.5 million dollars), when the ratio between the amount of the increase of the credit line and the amount of increase in the factoring limits, and out of the amount stated above, the amount of the immediate increase in the aforementioned limits and the increase that will depend on the Company's sales growth, will be subject to an agreement between the Company and Litef. in the sum of US 9.75 million dollars to a sum of US 11.75 million dollars (hereinafter: "the “ Base Limit”. The Base Limit might be increased by an additional amount of up to US 3.5 million dollars, depending on the sales of the Company, as detailed as follows:

a. During each quarter there shall be an examination of the Company’s sales on a cumulative basis in the last four quarters. In the event these sales shall exceed the sum of US 95 million dollars (hereinafter: the "Base Sales"), then the Base Limit shall increase by a sum equal to 30% of the sum of the increase in the sales which has exceeded the Base Sales. In any event the credit limit shall not exceed the sum of US 15.25 million dollars.

b. The aforementioned examination in sub-clause a above, shall be carried out on a quarterly basis in comparison to the Base Sales, and as a result of such examination the credit limit might also be decreased in comparison to the previous quarter, as applicable. In any event, the credit limit, as a result of such decrease, shell not be less than the Base Limit.

(3) Cancellation of the mechanisms for the early repayment of the long-term loans set out in the Financing Agreement.

(4) The investments that will be carried out by the Company as of January 1, 2015, shall not exceed, each year during the period of long-term loans, an amount equal to the Investment Amount plus the free EBITDA (the annual EBITDA less payments of principal and interest and financing costs for the Banks and tax payments) on an accumulated basis, less the investments carried out by the Company since the beginning of 2015 on an accumulated basis. The Company shall not carry out investments in fixed assets, exceeding the following amounts on a cumulative basis: a. The Investment Amount that shall be invested in the Company in shareholders’ equity in accordance with the Private Offering. b. An amount exceeding, as of the beginning of 2015, the amount of the aggregate balance of the Company's EBITDA, less payments of principal and interest on loans and taxes paid, while starting as of 2018 (inclusive), it shall be deducted each year of the said aggregate balance, an additional sum of 50% of the current maturities of the payments to the Banks (principal and interest) of the following year. Investments, as aforementioned, shall also be subject to the following terms: a. Every single investment during the course of the year, in an amount exceeding US 5 million dollars, will be subject to a prior examination carried out by the aforementioned Banks. b. The aggregate investments during the course of the year shall not exceed a sum of US 7 million dollars. (5) No change in the financial covenants currently existing in the Financing Agreement despite the increase in the equity resulting from the investment, except, as the change may be required in the framework of increasing the credit lines limits as specified in clause (2) above. Regarding the financial covenants currently existing in the Financing Agreement with the Banks, see the Company's immediate report dated March 27, 2014 (Reference No.: 2014-01-027357).

The Company is in discussions with the Banks in order to reach an agreement with them which will allow On May 18, 2015 the Company and the subsidiaries Macro Clothing Ltd. and Hi-Tex founded by Tefron Ltd., engaged in an amendment to the Financing Agreement with the Banks, which allows the existence of all the conditions precedent described in the previous clauses (1) - (5). however at this stage it has not yet been completed. If the Company reaches an agreement with the Banks, it shall return and report on such matter.For further details, see the Company's immediate report dated May 18, 2015 (Reference No.: 2015-01-021879 ).

d. In the event that, for whatever reason, all of the aforementioned conditions precedent will not be completed until May 2131, 2015, then the Agreement will be cancelled, and neither of the parties to the Agreement shall have any complaint and/or claim of any kind whatsoever, against the other.

The principals of the Additional Investment Agreement

As noted above, on April 2, 2015, the Company signed the Additional Investment Agreement, the principals of which are detailed as follows: 1. At the closing date, the Additional Investors shall invest each a sum of US 175,000 dollars, and in total a sum of US 525,000 dollars, against an allocation of 490,653 of the Company's ordinary shares (163,551 ordinary shares to each of the Additional Investors), so that for each share the Additional Investors shall pay a sum of US 1.07 dollars. It shall be noted that the price per each share is lower than its nominal value (NIS 10). Therefore, in accordance with Section 304(a) of the Companies Law, the Company shall convert part of its profits from premium on shares included in its equity as presented in the recent financial statements of the Company, into share capital, in an amount equal to the difference between the par value of each share issued (NIS 10), and the amount to be paid for it (US 1.07 dollars). The calculation of the conversion of 10 NIS into US dollar will be carried out in accordance to the exchange rate of the US dollar, as listed at the time of the payment of the consideration.

2. The date for closing the Additional Investment Agreement has been set to the date of closing the transaction with Litef, and in any event no later than May 2131, 2015 or to a deferred date as it shall be agreed upon between the Company and Litef (subject to the fact that the closing date shall be postponed to a date after August 31, 2015, then the Additional Investors shall hold the right to terminate the Agreement), and all after the fulfillment of all the conditions precedent, as detailed in the Agreement, amongst which are the following:

a. The Approval, in accordance to the provisions of any law, of the Private Offering, including the approval of the allocation of the shares according to the Agreement and the Additional Investment Agreement, of the Company's Audit Committee and Board (that granted their approval on February 18, 2015 and April 1, 2015), as well as by the meeting of the Company’s shareholders, that is convened according to this report, by a special majority pursuant to Section 275 of the Companies Law.

b. The approval of the Stock Exchange regarding the registration for trading of the shares to be allocated under the Agreement.

b. The closing of the transaction according to the Agreement.

Name of the controlling shareholder who has a personal interest and the nature of that interest

To the best knowledge of the Company, as at the date of this report, Nouvelle Group and Mivtach Shamir Holdings Ltd. (hereinafter: "Mivtach Shamir"), are a party to a shareholders' agreement under which the parties will use their power as shareholders in certain matters, including the appointment of directors of the Company, in a manner according to which each party obligates to support a specified number of candidates proposed by the other party to fill the position of director of the Company (hereinafter: the "Shareholders Agreement"). As at April 2, 2015, Mivtach Shamir and Nouvelle Group , jointly hold approximately 43.92% of the issued and paid up share capital of the Company and voting rights therein and approximately 38.59% of the issued and paid up share capital of the Company and the voting rights therein on a fully diluted basis3. For more details, see Clause 3 of Part A of this immediate report. Litef has a personal interest in the said engagement since it is a party to the Agreement.

3 See Footnote 2. Nouvelle has a personal interest in the said engagement since Litef and Nouvelle jointly hold shares of the Company. Mivtach Shamir has a personal interest in the aforementioned engagement since it is a party to the shareholders agreement.

Name of the directors who may be considered as having a personal interest and the nature of that interest Director Brahm Gelfand may have a personal interest due to his business connections with the Nouvelle Group. Director Guy Shamir, the son of Meir Shamir who is the controlling shareholder of Mivtach Shamir, may have a personal interest due to the personal interest Mivtach Shamir might have (regarding this matter see the aforementioned paragraph entitled “name of the controlling shareholder who has a personal interest and the nature of that interest”). Director Avi Ziegelman has asked to handle the approval of the matter of engaging in the Agreement, as if he has a personal interest in the engagement.

Conditions of the securities offered, their quantity and the percentage they constitute of the issued and paid up share capital of the Company As part of the private offering the Offerees are offered, 5,163,550 Ordinary Shares of the Company that will be allocated on the closing date (hereinafter: the "Allocated Shares"). The Allocated Shares will be equal in their rights to the existing ordinary shares in the issued and paid up capital of the Company. The Allocated Shares shall constitute, immediately after the allocation, approximately 43.5% of the issued and paid up share capital of the Company and voting rights therein.

The consideration for the offered securities The consideration for the Allocated Shares allocated to the Offerees amounts to US 5,525 thousand dollars (US 1.07 dollars per share), and it will be paid in cash against an allocation of 5,163,550 Ordinary Shares of the Company on the closing date. The closing price of one share in dollars on the Stock Exchange as at March 2, 2015, was US 1.14 dollars compared to the price per share in the private offering which is US 1.07 dollars, a price lower by approximately 6.1% compared to the price on the Stock Exchange as aforementioned.

Convening of an Extraordinary General Meeting of the shareholders of the Company

A notice is hereby given concerning the convening of an Extraordinary General Meeting of the shareholders of the Company, which will be held on Monday, May 1825, 2015, at 09:00 a.m. Israel time) at the offices of Zahavi, Blau & Co., Law Offices & Notary, located at 96 Yigal Alon St., Tel Aviv. For inquiries call: 04-9900881.

The topic on the General Meeting’s agenda: Approval of engaging in the Agreement. The required majority The required majority at the General Meeting for the purpose of approving the resolution on the agenda, is an ordinary majority which is greater than half of the shareholders’ votes attending the vote, except for abstaining votes, and as long as one of the following is fulfilled: (a) counting the votes of the majority at the General Meeting shall include at least a majority of all the votes of the shareholders who do not have a personal interest in the approval of the transaction, who are participating in the vote; in counting all of the votes of the aforesaid shareholders, abstaining votes would not be taken into consideration; (b) The total opposing votes from among the shareholders referred to in sub-clause (a) above, shall not be greater than two percent of the total voting rights in the Company. Prior to the vote regarding the resolutions on the agenda, every shareholder who wishes to participate in the vote shall be required to give notice to the Company whether or not he has a personal interest in the resolution as aforesaid, or if not. If the shareholder did not give notice as aforesaid, he shall not vote in regards with the aforesaid resolution and his vote shall not be counted.

The record date for the purpose of determining the eligibility of the shareholders to participate and vote at the General Meeting

The record date for determining the eligibility of a shareholder of the Company to participate and vote at the General Meeting, is the end of trade day on Thursday, April 16, 2015 (hereinafter: the “Record Date”).

In accordance with the Companies Regulations (Proof of Ownership of a Share for the purpose of Voting at a General Meeting) 2000, (hereinafter: “Proof of Ownership Regulations”), a shareholder in whose favor a share is registered with a member of the Tel Aviv Stock Exchange Ltd., and that share is included amongst the shares of the Company registered in the Register of Shareholders in the name of a nominee company and he wishes to vote at the General Meeting, shall submit to the Company a confirmation from the said member of the Stock Exchange with whom his title to the share is registered, with respect to his ownership of the share, on the Record Date, in accordance with Form 1 in the Addendum to the Proof of Ownership Regulations.

If you are an owner of an “American Share”, meaning: a Company’s share that is not an “Israeli Share”, as defined as follows, in order to vote at the Meeting, please see the voting instructions detailed on the voting card which can be found on the Company’s internet site whose address is: www.tefron.com.

“ An Israeli Share”- A Company’s share that fulfills one of the following: (a) The share is registered in the Company’s Israeli shareholder register (for the purpose of clarity, a Company’s share which is registered in the Company’s American shareholder register, that is managed by the American Stock Transfer & Trust Company, is not “an Israeli Share”); or (b) the share is registered with a member of the Stock Exchange ( of Tel Aviv Stock Exchange Ltd.) in the shareholder’s favor, and the aforesaid share is included in the shares registered on the Company’s Israeli shareholder register in the name of the Registration Company of Bank Hapoalim Ltd.

The quorum for opening the deliberation at the General Meeting is two (2) shareholders or more (whose shares have been fully paid) attending the Meeting in person or via a proxy or via a voting card, per item, and holding at least twenty five (25%) of the voting rights in the Company. If half an hour has passed from the time that was scheduled for the meeting and a quorum hasn’t been established, the meeting shall be deferred for the exact same day of the week and hour in the forthcoming week, or to a different day, hour and place as determined by the chairman of the meeting, with the agreement of the majority of the shareholders with voting rights attending themselves or via a proxy or via a voting card, and voting in the matter of the date of the postponed meeting. The quorum in the postponed meeting shall be two (2) shareholders attending the meeting in person or via a proxy or via a voting card, per item, and holding at least twenty five (25%) of the voting rights in the Company.

The shareholders may vote regarding the resolution on the meeting’s agenda, in person or via a proxy. The proxy appointment statement form must be carried out according to the Company’s regulations.

The appointment statement must be delivered to the chairman of the meeting or to the Company’s offices (to the CFO of the Company, Mr. Eliezer Parnafes), so that it would arrive to the Company’s offices at least two hours prior to the convening of the meeting. Thec of the meeting shall have the authority to receive appointment statements which were delivered even after the aforementioned appointed time and till the beginning of the meeting.

A shareholder is entitled to vote regarding the resolution on the meeting’s agenda, through a voting card. For this purpose, the vote of a shareholder who voted via a voting card shall be considered as if the shareholder was present and participated in the meeting. Voting via a voting card, in regards to a shareholder seeking to vote via a voting card in lieu of participating in the meeting in person or by a proxy, shall be carried out using the second part of the voting card attached to this report. The voting card and the documents required to be attached to it as detailed in the voting card, shall be delivered to the Company’s offices no later than 72 hours prior to the time appointed for the convening of the meeting. For this purpose, the date of submittal is the date on which the voting card and the documents required to be attached to it, reached the Company’s offices.

A shareholder participating in the vote in regards with the resolution on the meeting’s agenda, shall notify the Company prior to his voting – and if the voting is via a voting card – he shall make his markings on the second part of the voting card, on the designated section, whether he is considered as a controlling shareholder of the Company and/or having personal interest in approving the resolution, as detailed above, or if not. If the aforementioned shareholder failed to notify as aforesaid, his vote shall not be counted.

The voting cards and appointment statements that have been received by the Company until the date of this amended report shall remain in force for the purpose of the general meeting convened on May 25, 2015, unless the shareholder shall notify the Company otherwise.

The addresses of the websites of the Securities Authority and the Tel Aviv Stock Exchange Ltd. where one can find the voting card and the position statements, as their meaning in Section 88 of the Companies Law, are: the ISA distribution site http://www.magna.isa.gov.il (hereinafter the “Distribution Site”); and the website of the Tel Aviv Stock Exchange Ltd. http://maya.tase.il. The shareholders are entitled to approach the Company directly and receive from it the voting card and the position statements.

A Stock Exchange member shall sent via email, at no cost, a link to the voting card and position statements on the Distribution Site, to every shareholder who is an unlisted shareholder and whose shares are listed with the aforesaid Stock Exchange member, unless the shareholder has notified the Stock Exchange member that he is not interested in receiving such a link, as long as the notification was given in regards of a specific securities account and on a date prior to the Record Date or that he is interested in receiving voting cards in the mail, for a certain cost.

A shareholder whose shares are listed with a Stock Exchange member is entitled to receive the proof of ownership from the Stock Exchange member, with whom his stocks are listed, at the Stock Exchange member’s branch or by mail to his mailing address, paying only the postage fees, if he has asked for it. A request in this matter would be given in advance for a specific securities account.

The last date for delivering the position statements is no later than 10 days after the Record Date, meaning until Sunday, April 26, 2015. The Company does not permit voting via the internet.

Reviewing the documents A copy of this immediate report together with the addendums thereto shall be made available for review at the Company's offices Sunday to Thursday during normal working hours, after prior arrangement by telephone: 04-9900818, and this until the date of convening the meeting to approve the resolution on the agenda as well as on the Securities Authority website at the address: www.magna.isa.gov.il

Date: April 2May 18, 2015 TEFRON LTD

(The “Company”)

April 2May 18, 2015

To: To: Securities Authority Tel-Aviv Stock Exchange Ltd. www.isa.gov.il www.tase.co.il

Dear Sirs, Re: An Amended Immediate Report in accordance with the Securities Regulations (a Transaction between a Company and a Controlling Shareholder Therein), 2001, and in accordance with the Securities Regulations (Private Offering of Securities in a Listed Company), 2000, concerning the convening of an Extraordinary General Meeting of the shareholders of the Company

The Company hereby submits an immediate report in accordance with Regulation 4 of the Securities Law (Private Offering of Securities in a Listed Company), 2000, (hereinafter: “Private Offering Regulations”) and in accordance with Regulation 3 of the Securities Law (Transaction between a Company and a Controlling Shareholder Therein), 2001 (hereinafter: “Transaction with a Controlling Shareholder Regulations”), regarding a transaction of the Company with a controlling shareholder thereof, Litef Holdings Inc., a private company incorporated in Canada (hereinafter: “Litef"),regarding an extraordinary private offering of 4,672,897 ordinary shares of the Company of NIS 10 par value each (hereinafter: "Ordinary Shares") to Litef and regarding a private offering of 490,653 ordinary shares to additional investors as detailed as follows.

According to the aforesaid, the Company announces the convening of an Extraordinary General Meeting of the Company, which will be held on Monday, May 1825, 2015, at 09:00 am at the offices of Zahavi, Blau & Co., Advocates, 96 Yigal Alon St., Tel Aviv

1. Preface

On February 17, 2015, the Company signed an agreement with Litef, according to which Litef will invest a total of US 5 million dollars in the Company against an extraordinary private offering of 4,672,897 Ordinary Shares (hereinafter: the "Agreement" or the “Transaction”). The Company reported on the signing of the Agreement in an immediate report, on February 18, 2015, Reference No.: 2015-01-033661.

On February 18, 2015, the Company's Board of Directors decided, after obtaining the approval of the Audit Committee of the Company on the same day, to approve the engagement of the Company in an agreement, which includes a transaction between the Company and Litef as well as the allocation of shares to Litef, all as set forth in Clause 2 as follows. On April 2, 2015, and pursuant to receiving the approval of the Company's Audit Committee and Board of Directors following their meetings dated April 1, 2015, the Company signed an agreement with Mazouz and Weisselberger Genesis Investment, Limited Partnership (hereinafter: "Genesis"), Mr. Erez Rozenbuch and Mr. Tomer Hefetz (hereinafter: the "Additional Investors"), according to which they shall invest in the Company a sum of US 525,000 dollars (in equal parts), against a private offering of 490,653 ordinary shares (hereinafter: the "Additional Investment Agreement"), furthermore the Company signed on an amendment to the Agreement resulting from the Additional Investment Agreement. On May 18, 2015, the Company signed on an additional amendment to the Agreement resulting from the understandings the Company has reached with its financing banks. (hereinafter: the Agreement and the Additional Investment Agreement shall be called together" the "Private Offering").

The Private Offering is brought for the approval of the General Meeting of the shareholders of the Company, for the reasons set forth below:

a. The Private Offering is a transaction which includes an extraordinary private offering to Litef, who is among the controlling shareholders of the Company, and therefore it is presented for approval as an extraordinary transaction with a controlling shareholder in accordance with Section 270(4) and 275 of the Companies Law 1999 (hereinafter: the "Companies Law ")4.

b. As at the date of this report, Litef and Nouvelle Intimes Seamless Inc., a rivate company incorporated in Canada (hereinafter: "Nouvelle") (Litef and Nouvelle shall be called hereinafter: "Nouvelle Group") jointly hold approximately 32.47% of the issued and paid up share capital of the Company and the voting rights therein and approximately 28.53% of the issued and paid up share capital of the Company and the voting rights therein on a fully diluted basis5. In the framework of the Transaction, 4,672,897 Ordinary Shares of the Company shall be allocated to Litef, so that upon the closing of the Transaction, the Nouvelle Group shall jointly hold approximately 57.71% of the issued and paid up share capital of the Company and the voting rights therein and approximately 53.53% of the issued and paid up share capital of the Company and the voting rights therein on a fully diluted basis. Since as at the date of this report, there is no other person who holds more than 45% of the issued and paid up share capital of the Company (regarding this matter, see also Clause 3 as follows), the Transaction is brought to the approval of the meeting of the shareholders of the Company also in accordance with Section 328(b)(1) of the Companies Law, as a private offering whose aim is to grant the shareholders of the Nouvelle Group more than 45% of the voting rights in the Company.

2. The principals of the Agreement and the Additional Investment Agreement:

The principals of the Agreement:

As aforementioned, on February 17, 2015, the Company signed the Agreement. The principles of the Agreement are detailed as follows:

4 For details regarding the controlling shareholders of the Company, as at this date, see Clause 3 as follows. 5 Calculation of the rate of holdings on a fully diluted basis was made as at April 2, 2015, excluding 99,740 ordinary shares of the Company held by a subsidiary of the Company and assuming the full exercise of the warrants (non-negotiable) to employees, consultants and officers of the Company as well as rights to shares, exercisable for 135,000 ordinary shares of the Company (after taking into account adjusting the amount to holders of option warrants due to the rights issue carried out by the Company in March 2010). 2.1 On the closing date (as this term is defined as follows) Litef will invest in the Company a total of US 5 million dollars (hereinafter: the "Investment Amount"), against an allocation of 4,672,897 Ordinary Shares of the Company, so Litef shall pay for each share a price of US 1.07 dollars. It is noted that the payment for each share is lower than its nominal value (NIS 10). Therefore, in accordance with Section 304(a) of the Companies Law, the Company shall convert part of its profits from premium on shares included in its equity as presented in the recent financial statements of the Company, into share capital, in an amount equal to the difference between the par value of each share issued (NIS 10), and the amount to be paid for it (US 1.07 dollars). The calculation of the conversion of 10 NIS into US dollar will be carried out in accordance to the exchange rate of the US dollar, as listed at the time of the payment of the consideration.

2.2 Nouvelle and Messrs. Ben and Martin Lieberman, who are amongst the controlling shareholders of the Company, signed on 30 December 2010, a commitment not to compete with the Company in the field of seamless products for a limited period of 5 years as of the date of signing such non-competition letter of commitment, and all as detailed in the letter of commitment (hereinafter: the “Letter of Commitment). In the framework of the Agreement it was agreed upon that Litef would join as a party to the Letter of Commitment and it will remain in force as long as Nouvelle, Messrs. Ben and Martin Lieberman, and Litef, each on its own, will be amongst the controlling shareholders of the Company.

2.3 The closing of the Transaction has been set to a date no later than five business days after the fulfillment of all the conditions precedent (hereinafter: the “Closing Date”) as specified in the Agreement, including:

a. An approval, in accordance with the provisions of the law, of the Company’s engagement in the Agreement including an approval to allocate the shares in accordance to the Agreement by the Company’s Audit Committee and Board of Directors (who have granted their approval during their meeting on February 18, 2015), as well as by the meeting of the Company’s shareholders, that is convened according to this report, by a special majority pursuant to Section 275 of the Companies Law. It shall be noted that for the purpose of accompanying the negotiations with the controlling shareholder, the Company's Board has established a special and independent committee whose members are the members of the Audit Committee of the Company, and it has accompanied the negotiations with the controlling shareholder and approved the conditions of the Agreement on February 12, 2015.

b. The approval of the Stock Exchange regarding the registration for trading of the shares to be allocated under the Agreement. c. The Company's engagement with its financing banks, Bank Leumi Le-Israel Ltd., Bank Hapoalim Ltd. and Israel Discount Bank Ltd. (hereinafter: the "Banks") in an agreement to amend the existing financing agreement of the Company (hereinafter: the "Financing Agreement") regarding the following topics:

(1) Refinancing of the Company's long-term loans in the amount of sixteen million US dollars into long term loans with a repayment term of 10 8 years, which will be repaid in equal annual principal repayments as detailed as follows: a sum of US 1.7 million dollars in 2015, a sum of US 1.65 million dollars in each of the years as of 2016 and until 2022 (inclusive), and a repayment of US 2.75 million dollars in the first quarter of 2023..

(2) Increasing the Banks' existing short-term credit lines (a credit line of 9.75 million US dollars) and increasing the agreed-upon amount of the factoring limits (a factoring limit of 2.5 million US dollars), in an amount equal to 150% of the Investment Amount (i.e. US 7.5 million dollars), when the ratio between the amount of the increase of the credit line and the amount of increase in the factoring limits, and out of the amount stated above, the amount of the immediate increase in the aforementioned limits and the increase that will depend on the Company's sales growth, will be subject to an agreement between the Company and Litef. in the sum of US 9.75 million dollars to a sum of US 11.75 million dollars (hereinafter: "the “Base Limit”. The Base Limit might be increased by an additional amount of up to US 3.5 million dollars, depending on the sales of the Company, as detailed as follows:

c. During each quarter there shall be an examination of the Company’s sales on a cumulative basis in the last four quarters. In the event these sales shall exceed the sum of US 95 million dollars (hereinafter: the "Base Sales"), then the Base Limit shall increase by a sum equal to 30% of the sum of the increase in the sales which has exceeded the Base Sales. In any event the credit limit shall not exceed the sum of US 15.25 million dollars.

d. The aforementioned examination in sub-clause a above, shall be carried out on a quarterly basis in comparison to the Base Sales, and as a result of such examination the credit limit might also be decreased in comparison to the previous quarter, as applicable. In any event, the credit limit, as a result of such decrease, shell not be less than the Base Limit. (3) Cancellation of the mechanisms for the early repayment of the long-term loans set out in the Financing Agreement.

(4) The investments that will be carried out by the Company as of January 1, 2015, shall not exceed, each year during the period of long-term loans, an amount equal to the Investment Amount plus the free EBITDA (the annual EBITDA less payments of principal and interest and financing costs for the Banks and tax payments) on a cumulative basis, less the investments carried out by the Company since the beginning of 2015 on a cumulative basis. The Company shall not carry out investments in fixed assets, exceeding the following amounts on a cumulative basis: c. The Investment Amount that shall be invested in the Company in shareholders’ equity in accordance with the Private Offering. d. An amount exceeding, as of the beginning of 2015, the amount of the aggregate balance of the Company's EBITDA, less payments of principal and interest on loans and taxes paid, while starting as of 2018 (inclusive), it shall be deducted each year of the said aggregate balance, an additional sum of 50% of the current maturities of the payments to the Banks (principal and interest) of the following year. Investments, as aforementioned, shall also be subject to the following terms: c Every single investment during the course of the year, in an amount exceeding US 5 million dollars, will be subject to a prior examination carried out by the aforementioned Banks. d. The aggregate investments during the course of the year shall not exceed a sum of US 7 million dollars.

(5) No change in the financial covenants currently existing in the Financing Agreement despite the increase in the equity resulting from the investment, except, as the change may be required in the framework of increasing the credit lines’ limits as specified in clause (2) above. Regarding the financial covenants currently existing in the Financing Agreement with the Banks, see the Company's immediate report dated March 27, 2014 (Reference No. 2014-01-027357).

On May 18, 2015 the Company and the subsidiaries Macro Clothing Ltd. and Hi-Tex founded by Tefron Ltd., engaged in an amendment to the Financing Agreement with the Banks, which allows The Company is in discussions with the Banks in order to reach an agreement with them which will allow the existence of all the conditions precedent described in the previous clauses (1) - (5). however at this stage it has not yet been completed. If the Company reaches an agreement with the Banks, it shall return and report on such matter. For further details, see the Company's immediate report dated May 18, 2015 (Reference No.: 2015-01-021879).

2.4 In the event that, for whatever reason, all of the aforementioned conditions precedent will not be completed until May 2131, 2015, then the Agreement will be cancelled, and neither of the parties to the Agreement shall have any complaint and/or claim of any kind whatsoever, against the other.

The principals of the Additional Investment Agreement

2.5 As noted above, on April 2, 2015, the Company signed the Additional Investment Agreement, the principals of which are detailed as follows:

2.6 At the closing date, the Additional Investors shall invest each a sum of US 175,000 dollars, and in total a sum of US 525,000 dollars, against an allocation of 490,653 of the Company's ordinary shares (163,551 ordinary shares to each of the Additional Investors), so that for each share the Additional Investors shall pay a sum of US 1.07 dollars. It shall be noted that the price per each share is lower than its nominal value (NIS 10). Therefore, in accordance with Section 304(a) of the Companies Law, the Company shall convert part of its profits from premium on shares included in its equity as presented in the recent financial statements of the Company, into share capital, in an amount equal to the difference between the par value of each share issued (NIS 10), and the amount to be paid for it (US 1.07 dollars). The calculation of the conversion of 10 NIS into US dollar will be carried out in accordance to the exchange rate of the US dollar, as listed at the time of the payment of the consideration.

2.7 The date for closing the Additional Investment Agreement has been set to the date of closing the transaction with Litef, and in any event no later than May 2131, 2015 or to a deferred date as it shall be agreed upon between the Company and Litef (subject to the fact that the closing date shall be postponed to a date after August 31 2015, then the Additional Investors shall hold the right to terminate the Agreement), and all after the fulfillment of all the conditions precedent, as detailed in the Agreement, amongst which are:

a. The Approval, in accordance to the provisions of any law, of the Private Offering, including the approval of the allocation of the shares according to the Agreement and the Additional Investment Agreement, of the Company's Audit Committee and Board (that granted their approval on February 18, 2015 and April 1, 2015), as well as by the meeting of the Company’s shareholders, that is convened according to this report, by a special majority pursuant to Section 275 of the Companies Law.

b. The approval of the Stock Exchange regarding the registration for trading of the shares to be allocated under the Agreement. b. The closing of the transaction according to the Agreement.

3. The Company’s controlling shareholders and the nature of their personal interest

To the best knowledge of the Company Nouvelle Group and Mivtach Shamir Holdings Ltd. (hereinafter: "Mivtach Shamir"), are a party to a shareholders' agreement under which the parties will use their power as shareholders in certain matters, including the appointment of directors of the Company, in a manner according to which each party obligates to support a specified number of candidates proposed by the other party to fill the position of director of the Company (hereinafter: the "Shareholders Agreement"). Therefore, Mivtach Shamir and Nouvelle Group are considered as jointly holding approximately 43.92% of the issued and paid up share capital of the Company and voting rights therein and approximately 38.09% of the issued and paid up share capital of the Company and the voting rights therein on a fully diluted basis. As detailed as follows:

Percentage the Shares Percentage the Constitute of the Shares Constitute Quantity of Capital and Voting Name of Shareholder of the Capital and Shares Rights of the Company Voting Rights of the on a Fully Diluted Company6 Basis7

Litef Holdings Inc.8 1,577,619 23.52 20.67 Intimes Nouvelle Seamless 600,000 8.95 7.86 Inc.9

6 Calculated excluding 99,740 ordinary shares of the Company which are held by a subsidiary of the Company, and which were acquired by the subsidiary prior to the entering into effect of the Israeli Companies Law. In practice, the Company’s subsidiary has undertaken not to exercise the voting rights and its rights of the share capital with respect to such Company’s shares, as aforementioned. Accordingly, the above calculation was carried out while excluding the holdings of the subsidiary of both the Company’s share capital and the voting rights. 7 See Footnote 5. 8 To the best knowledge of the Company, Litef Holdings Inc. is a private company incorporated in Canada and controlled by Messrs. Martin Lieberman and Ben Lieberman (amongst the shareholders of Nouvelle, see Footnote 9, as follows), in equal parts. 9 To the best knowledge of the Company, Nouvelle is a private company incorporated in Canada and controlled by Lamour Hosiery Manufacturing Inc. (hereinafter: “Lamour). Lamour’s shares are held as follows: 75% held by Canada Inc. 153367 which is held through the family trust of the late Mr. Aharon Lieberman. The beneficiaries of the trust fund are the late Mr. Aharon Lieberman’s children, Messrs. Ben, Martin, Helen and Lauren Lieberman; 25% held by Samlieb Holdings Inc. which is held through the late Sam Lieberman trust fund (the late Aharon Lieberman’s brother). The beneficiaries of the trust fund are the late Sam Lieberman’s children, Messrs. Michael, Larry, David and Paul Lieberman. 10 According to the report of the holdings of interested parties in Mivtach Shamir, dated February 5, 2015 (Reference No. 2015-01-025495): Mr. Meir Shamir holds approximately 35.8% of the voting rights and the rights in the share capital of Mivtach Shamir Holdings Ltd. (approximately 35.8% on a fully diluted basis), Leon Recanati holds Percentage the Shares Percentage the Constitute of the Shares Constitute Quantity of Capital and Voting Name of Shareholder of the Capital and Shares Rights of the Company Voting Rights of the on a Fully Diluted Company Basis Mivtach Shamir Holdings 768,171 11.45 10.06 Ltd.10 Total: 2,945,790 43.92 38.59

Litef has a personal interest in the said engagement since it is a party to the Agreement.

Nouvelle has a personal interest in the said engagement since Litef and Nouvelle jointly hold shares of the Company. Mivtach Shamir has a personal interest in the aforementioned engagement since it a party to the shareholders agreement. The Additional Investors are not a party to the controlling shareholders agreement and they do not hold and/or shall hold shares jointly and/or jointly with any of the controlling shareholders. Their personal interest in the engagement of each of the Additional Investors is solely due to the fact they are offerees in a private offering. 4. Names of the offerees and their being an interested party

The Offeree Litef is, a private company incorporated in Canada who is controlled by Messrs. Martin and Ben Lieberman. Litef is an interested party since it is a party to the Agreement and since it continues to be a part of Nouvelle Group, the controlling shareholders of the Company, who after the closing of the Transaction shall hold together approximately 57.71% of the issued and paid up share capital of the Company and voting rights therein and approximately 53.53% of the issued and paid up share capital of the Company and voting rights on a fully diluted basis. For details regarding the holdings of Litef in particular, and the

approximately 8.37% of the voting rights and the rights in the company's share capital (approximately 8.37% on a fully diluted basis), Yecheskel Dovrat holds approximately 0.02% of the voting rights and the share capital rights (approximately 0.02% on a fully diluted basis), the Clal Group holds approximately 8.63% of the voting rights and the share capital rights (approximately 8.63% on a fully diluted basis), Ashtrom Properties Ltd. holds approximately 8.77% of the voting rights and the share capital rights (approximately 8.77% on a fully diluted basis), the Menorah Group holds approximately 7.26% of the voting rights and the share capital rights (approximately 7.26% on a fully diluted basis), the Excellence Group holds approximately 2.86% of the voting rights and the share capital rights (approximately 2.86% on a fully diluted basis), the Phoenix Group holds approximately 2.68% of the voting rights and the share capital rights (approximately 2.68% on a fully diluted basis), and Epsilon holds approximately 0.04% of the voting rights and the share capital rights (approximately 0.04% on a fully diluted basis). According to the Mivtach Shamir’s report of the holdings of interested parties therein, Mivtach Shamir is controlled by Mr. Meir Shamir (35.8%).

10 Nouvelle Group in general, in the issued and paid up share capital of the Company, as at this date, see Clause 3 above.

The Offeree Genesis is a limited partnership registered in Israel. The general partner therein is Mazouz Weisselberger Investments Ltd. (hereinafter: the "General Partner"). The shareholders in the General Partner are Messrs. Weisselberger Ofir and Mazouz Ariel. After the allocation of the offered shares and on a fully diluted basis, Genesis shall not become an interested party of the Company as defined in the regulations of a private offering, since as a result of the execution of the allocation as aforementioned, Genesis shall not become a substantial shareholder as this term is defined in Sections 1 and 270(5) of the Companies Law.

The Offeree, Mr. Erez Rozenbuch is a private person, holding an Israeli citizenship. After the allocation of the offered shares and on a fully diluted basis, Mr. Rozenbuch shall not become an interested party of the Company as defined in the regulations of a private offering, since as a result of the execution of the allocation as aforementioned, he shall not become a substantial shareholder as this term is defined in Sections 1 and 270(5) of the Companies Law.

The Offeree, Mr. Tomer Hefetz is a private person, holding an Israeli citizenship. After the allocation of the offered shares and on a fully diluted basis, Mr. Hefetz shall not become an interested party of the Company as defined in the regulations of a private offering, since as a result of the execution of the allocation as aforementioned, he shall not become a substantial shareholder as this term is defined in Sections 1 and 270(5) of the Companies Law.

5. Terms of the securities offered, their quantity and the percentage they will constitute of the voting rights and the issued and paid up share capital of the Company after the allocation

As part of the Private Offering Litef and the Additional Investors are offered jointly, 5,163,550 Ordinary Shares of the Company that will be allocated on the Closing Date (hereinafter: the "Allocated Shares"). The Allocated Shares will be equal in their rights, in every respect, to the existing Ordinary Shares in the issued and paid up share capital of the Company immediately upon their allocation (for details regarding the rights that accompany the Company’s shares see Chapter 4 of the Company’s shelf prospectus dated May 28, 2012 (Reference No. 2012-01-137499)).

The Allocated Shares shall constitute, immediately after their allocation, approximately 43.5% of the issued and paid up share capital of the Company and voting rights therein and approximately 40.35% of the issued and paid up share capital of the Company and voting rights therein on a fully diluted basis11.

The Allocated Shares shall be registered in the name of a nominee company.

11 See Footnote 5. 6. The Company's issued share capital, the quantity and percentage of the holdings of the Offerees, the interested parties in the Company and the total holdings of the other shareholders before and after the Private Offering and on a fully diluted basis

6.1 As at April 1, 2015, the Company's registered share capital includes 20,000,000 ordinary shares of NIS 10 par value each and the issued share capital of the Company includes 6,806,47612 ordinary shares of NIS 10 par value each.

6.2 As follows is a detail account of the quantity and percentage of holdings of the Offerees, the interested parties in the Company and the total holdings of the other shareholders in the issued and paid up shared capital of the Company and voting rights therein, as at April 2, 2015, immediately following the Private Offering and immediately following the Private Offering on a fully diluted basis, as detailed as follows: Name of the As at April 2, 2015 After the allocation After the allocation on a shareholder (before the allocation) fully diluted basis**

12 Out of the aforementioned shares, 99,740 shares are shares that are held by a subsidiary (indirectly), as detailed in Footnote 6 above. % of share % of share Type of Type of Number of % of share capital and capital and securities and securities and ordinary capital and voting voting quantity quantity shares voting rights rights* rights* Litef Holdings 1,577,619 6,250,516 23.52% 52.66% 6,250,516 48.85% Inc.13 ordinary shares ordinary shares

Mazouz and Weisselberger 69,000 232,551 232,551 Genesis Investment, 1.03% 1.96% 1.82% ordinary shares ordinary shares Limited Partnership14

113,000 276,551 Erez Rozenbuch15 1.68% 2.33% 276,551 2.16% ordinary shares ordinary shares 97,343 260,834 260,834 Tomer Hefetz 1.45% 2.2% 2.04% ordinary shares ordinary shares Intimes Nouvelle 600,000 600,000 8.95% 5.05% 600,000 4.69% Seamless Inc.16 ordinary shares ordinary shares Mivtach Shamir 768,171 768,171 11.45% 5.47% 768,171 6.0% Holdings Ltd.17 ordinary shares ordinary shares Rimon Investment 458,752 458,752 6.84% 3.86% 458,752 3.58% Master Fund LP18 ordinary shares ordinary shares Tefron Holdings 99,740 99,740 0% 0% 99,740 0% (98) Ltd.19 ordinary shares ordinary shares

13 See Footnote 8. 14 See Section 4.

15 113,000 ordinary shares of the Company are held through Erez Rozenbuch Advocates, a company wholly-owned by the offeree, Mr. Erez Rozenbuch

16 See Footnote 9. 17 See Footnote 10. 18 To the best knowledge of the Company the interested parties in Rimon Investment Master Fund LP are as follows: Zvi Limon, is the managing partner in the management company that manages this partnership, Rimon Management Z.T. (2005) Ltd. (Company I.D. 513738831) and holds 33% of the voting rights; Dan Tocatly owns 33% of the voting rights, and Ziv Gil owns 33% of the voting rights in the company. 19 A private company, wholly-owned (indirectly) by the Company, holds 99,740 ordinary shares of the Company, which were purchased by the subsidiary (indirectly) prior to the entering into effect of the Israeli Companies Law – 1999. In practice, the Company’s subsidiary (indirectly) has undertaken not to exercise the voting rights or its rights in the share capital with respect to such shares, as aforementioned. Accordingly, the calculation of the rates of the holdings in this report was carried out while excluding the holdings of the subsidiary (indirectly) both in regards with the Company’s share capital and voting rights therein. 47,605 47,605 Arnon Tieberg20 0% 0% 47,605 0.37% options options 150,000 150,000 Gil Shimon21 0% 0% 150,00022 1.17% options options * See Footnote 6 above. ** See Footnote 5 above. 7. The consideration for the offered securities

The consideration for the Allocated Shares allocated to Litef and the Additional Investors amounts to US 5,525 thousand dollars, and it will be paid in cash on the Closing Date, against an allocation of 5,163,550 Ordinary Shares of the Company (each share shall be allocated for US 1.07 dollars per share).

8. The manner of determining the consideration

The consideration in the Agreement was determined in negotiations between the Company and Litef, in the framework of the negotiations between the management of the Company (accompanied by the special committee of the Board of Directors that was established for this purpose) and Litef, it was agreed upon that the share price to be determined shall be the higher of the following averages, as at the date of signing the Agreement: (1) the average share price of the Company’s share in US dollar on the Stock Exchange (the share price in US dollars is also listed on the Stock Exchange and is determined by translating the share price in NIS into US dollar, in accordance with the exchange rate of the dollar) during the six months preceding the date of the Agreement, (2) the average share price of the Company’s share in US dollar on the Stock Exchange during the three months preceding the date of signing the Agreement (3) the average share price of the Company’s share in US dollar on the Stock Exchange during the 30 trading days preceding the date of signing the Agreement. The reference to the share price in US dollars is determined due to the fact that the Company's financial statements are presented in US dollars.

Accordingly, on the date of signing the Agreement the aforementioned averages were examined (respectively: US 0.94 dollars, US 1.01 dollars and US 1.07 dollars) and it was determined that the highest average of the three shall constitute the consideration to be paid for each share allocated to Litef, i.e. 1.07 US dollars. The consideration in the Additional Investment Agreement is identical to the consideration for Litef's shares.

9. Personal interest in the consideration

Regarding the personal interest of Litef, Nouvelle and Mivtach Shamir - see Clause 3 above.

20 The chairman of the Company’s Board of Directors. 21 The Company’s CEO. 22 Under the theoretical assumption of exercising each option into one ordinary share of the Company, while taking into account that the shares to be issued in the exercise of the options will reflect only the value of the benefit (CashLess). Director Brahm Gelfand may have a personal interest because of his business connections with the Nouvelle Group.

Director Guy Shamir, son of Mr. Meir Shamir, the controlling shareholder of Mivtach Shamir, may have a personal interest due to the personal interest Mivtach Shamir may have (see Clause 3 above).

Director Avi Zigelman has asked to handle the approval of the matter of engaging in the Agreement, as if he has a personal interest in the engagement.

10. Details regarding the average share price

The average share price of the Company’s share on the Tel Aviv Stock Exchange during the six months preceding the date of the publication of the report is US 0.94 dollars. The closing price of the Company’s share in US dollar on the Stock Exchange on February 17, 2015 (immediately before the date of signing the Agreement) was US 1.32 dollars. The closing price of the Company’s share in US dollar on the Stock Exchange on February 18, 2015 (immediately before the Board’s decision regarding the approval of the Agreement) was US 1.31 dollars. The closing price of the Company’s share in US dollar on the Stock Exchange on March 2, 2015 (immediately before the publication of this report) was US 1.14 dollars, in comparison to the share price in the Private Offering which is US 1.07 dollars, which is lower in 6.1% compared to the price on the Stock Exchange, as aforesaid.

11. The goals of the consideration

The Company will use the consideration it will receive against the allocation of shares, in accordance with the decisions of the Company’s Board of directors, as they will be made from time to time.

12. The approvals and meeting the conditions, required to execute the allocation pursuant to the Private Offering

The approvals and meeting the conditions, required to execute the allocation of shares pursuant to the Private Offering.

a. The approval of the Tel Aviv Stock Exchange regarding the registration for trading of the shares allocated pursuant to the Private Offering.

b. The approval of the Company’s Audit Committee that was granted at its meeting dated February 18, 2015 and April 1, 2015.

c. The approval of the Company’s Board of Directors that was granted at its meeting dated February 18, 2015 and April 1, 2015. d. The approval of the General Meeting of the shareholders of the Company which is scheduled to convene for this purpose on May 1825, 2015, as detailed in this report.

e. Amending the Company's Financing Agreement, as detailed in Sub-clause 2.3(c) above. The Company is in discussions with the Banks in order to reach an agreement with them which will allow the fulfillment of all of the aforesaid in the previous Sub-clause 2.3(c) above; however at this stage it has not yet been completed. If the Company reaches an agreement with the Banks, it shall return and report on such matter.

Subject to receiving all the approvals and the fulfillment of all the aforementioned conditions until May 2131, 2015, the shares will be allocated pursuant to the Private Offering, within 5 business days of the date of receiving all the approvals and the fulfillment of all of the aforementioned conditions.

It is further noted that for the purpose of accompanying the negotiations with Litef, the Company’s Board has established a special and independent committee whose members are the members of the Audit Committee of the Company, and it has accompanied the negotiations with Litef and approved the conditions of the Agreement on February 12, 2015 (hereinafter: the “Special Committee”).

13. Details of agreements between Litef and other shareholders of the Company

See Clause 3 above.

14. Details of similar transactions between the Company and the controlling shareholders that have been signed during the past two years or that are still in effect

On December 29, 2010, the Company’s shareholders meeting approved the engagement of the Company in a number of agreements with the Nouvelle Group and other shareholders of the Company. As part of the agreements that were approved, as aforementioned, by the General Meeting of the shareholders of the Company, the Company's engagement in a non- competition agreement was approved in regards with Nouvelle and Messrs. Ben and Martin Lieberman regarding the Company, whereby they have undertaken not to compete with the Company in the field of seamless products for a period of 5 years as of the date of signing the Letter of Commitment, i.e. by December 30, 2015. For further details, see the Company's immediate report dated November 24, 2010 (Reference No.: 2010-01-6918151).

15. Exclusion or limitation applicable while carrying out transactions with the allocated securities in the framework of the Transaction

A restriction of resale shall be applicable to the Offerees for a period of 6 months and for an additional period of six quarters, all in accordance with the provisions of Section 15c of the Securities Law, 1968, and with the provisions of Section 5 of the Securities Regulations (details regarding Sections 15a to 15c of the Law), 2000. 16. Reasons of the Audit Committee and the Board of Directors for the approval of the Private Offering

At the Company’s Audit Committee and Board’s decisions to approve the Agreement and the Additional Investment Agreement, including the Private Offering, which were unanimously, it was noted that:

a. The process of fundraising including fundraising according to the Additional Investment Agreement is essential for the Company in order to increase the Company's flexibility in its ongoing business management and its financial strength especially in light of its obligations to its financing Banks.

b. The sum of the additional investment shall help the Company to reach an agreement with its financing banks; reaching such an agreement is a condition precedent in the Agreement.

c. The possibility of fundraising from the controlling shareholder in a Private Offering is the quickest and most effective possibility for raising the capital, especially in light of the Company’s circumstances since there is no shareholder holding more than forty-five percent of the voting rights in the Company.

d. The Company’s Audit Committee and Board of Directors believe that the mechanism to determine the share price, according to which the price will be determined as the highest of the three average price per share at the Stock Exchange listed on the date of signing the Agreement: (1) the average share price of the Company’s share in US dollars during the six months preceding the date of signing the Agreement , (2) the average share price of the Company’s share in US dollars during the three months preceding the date of signing the Agreement (3) the average share price of the Company’s share in US dollars during the 30 trading days preceding the date of signing the Agreement - is a fair and reasonable mechanism. As a result, the Company's share price (US 1.07 dollars) that has been determined in the framework of the Agreement is fair and reasonable.

e. In light of the aforementioned reasons, the Company’s Audit Committee and Board believe that the engagement in the Transaction is for the benefit of Company.

17. Names of the directors who have participated in the deliberations of the Audit Committee and the Board

The directors who have participated in the deliberation of the Audit Committee regarding the approval of the Agreement at its meeting on February 18, 2015, and regarding the approval of the Additional Investment Agreement at its meeting dated April 1, 2015, are Messrs. Eli Admoni (external director), Aviram Lahav (external director), Yossi Shachak and Eytan Stiassnie, all of whom have no personal interest in approving the Agreement. The directors have participated in the deliberation of the Board at its meeting on February 18, 2015, and at its meeting dated April 1, 2015, are Messrs. Arnon Tieberg (chairman of the Board), Eli Admoni (external director), Aviram Lahav (external director), Yossi Shachak and Eytan Stiassnie, all of whom have no personal interest in approving the Agreement.

Part B – Convening of a an Extraordinary General Meeting

18. Convening of an Extraordinary General Meeting and the date thereof

A notice is hereby given concerning the convening of an Extraordinary General Meeting of the shareholders of the Company, which will be held on Monday, May 1825, 2015 at 09:00 a.m. (Israel time) at the offices of Zahavi, Blau & Co., Law Offices & Notary, 96 Yigal Alon St., Tel Aviv. For inquiries call: 04-9900881.

19. The following resolution is on the agenda of the Company’s General Meeting:

The approval of the Company’s engagement in the Agreement.

20. The required majority

The required majority, at the General Meeting, for the purpose of approving the resolution on the meeting’s agenda, is an ordinary majority which is greater than half of the shareholders’ votes attending the voting, except for abstaining votes, and as long as one of the following is fulfilled: (a) counting the votes of the majority at the General Meeting shall include at least a majority of all the votes of the shareholders who do not have a personal interest in the approval of the transaction, who are participating in the vote; in counting all of the votes of the aforesaid shareholders, abstaining votes would not be taken into consideration; (b) The total opposing votes from among the shareholders referred to in sub-clause (a) above, shall not be greater than two percent of the total voting rights in the Company.

Prior to the vote regarding the resolutions on the agenda, every shareholder who wishes to participate in the vote shall be required to give notice to the Company whether he has a personal interest in the resolution as aforesaid, or if not. If the shareholder did not give notice as aforesaid, he shall not vote in regards with the aforesaid resolution and his vote shall not be counted.

21. Quorum and postponed meeting

The quorum for opening the deliberation at the General Meeting is two (2) shareholders or more (whose shares have been fully paid) attending the meeting in person or via a proxy or via a voting card, per item, and holding at least twenty five (25%) of the voting rights in the Company.

If half an hour has passed from the time that was scheduled for the meeting and a quorum hasn’t been established, the meeting shall be deferred to the exact same day of the week and hour in the forthcoming week, or to a different day, hour and place as determined by the chairman of the meeting, with the agreement of the majority of the shareholders with voting rights attending themselves or via a proxy or via a voting card, and voting in the matter of the date of the postponed meeting. The Company shall announce the deferral of the meeting and its date through an immediate report. The quorum in the postponed meeting shall be two (2) shareholders attending the meeting in person or via a proxy or via a voting card, per item, and holding at least twenty five (25%) of the voting rights in the Company.

22. The record date for the purpose of determining the eligibility of the shareholders to participate and vote at the General Meeting

The record date for determining the eligibility of a shareholder of the Company to participate and vote at the General Meeting, is the end of trade day on Thursday, April 16, 2015 (hereinafter: the “Record Date”).

If you are an owner of an “American Share”, meaning: a Company’s share that is not an “Israeli Share”, as defined as follows, in order to vote at the meeting, please see the voting instructions detailed on the voting card which can be found on the Company’s internet site whose address is: www.tefron.com.

“ An Israeli Share”- A Company’s share that fulfills one of the following: (a) The share is registered in the Company’s Israeli shareholder register (for the purpose of clarity, a Company’s share which is registered in the Company’s American shareholder register, that is managed by the American Stock Transfer & Trust Company, is not “an Israeli Share”); or (b) the share is registered with a member of the Stock Exchange (of Tel Aviv Stock Exchange Ltd.) in the shareholder’s favor, and the aforesaid share is included in the shares registered on the Company’s Israeli shareholder register in the name of the Registration Company of Bank Hapoalim Ltd.

23. Voting card and position statements

23.1 The Shareholders may vote regarding the resolution on the meeting’s agenda, in person or via a proxy. The proxy appointment statement must be carried out according to the Company’s Regulations.

23.2 The appointment statement must be delivered to the chairman of the meeting or to the Company’s offices (to the CFO of the Company, Mr. Eliezer Parnafes), so that it would arrive to the Company’s offices at least two hours prior to the convening of the meeting. The chairman of the meeting shall have the authority to receive appointment statements which were delivered even after the aforementioned appointed time and until the beginning of the meeting.

23.3 A shareholder is entitled to vote regarding the resolution on the meeting’s agenda, via a voting card. For this purpose, the vote of a shareholder who voted via a voting card shall be considered as if the shareholder was present and participated in the meeting. Voting via a voting card, in regards to a shareholder seeking to vote via a voting card in lieu of participating in the meeting in person or via a proxy, shall be carried out while using the second part of the voting card attached to this report. The voting card and the documents required to be attached to it as detailed in the voting card, shall be delivered to the Company’s offices no later than 72 hours prior to the time appointed for the convening of the meeting. For this purpose, the date of submittal is the date on which the voting card and the documents required to be attached to it, reached the Company’s offices.

23.4 A shareholder participating in the vote in regards with the resolution on the meeting’s agenda, shall notify the Company prior to his voting – and if the voting is via a voting card – he shall make his markings on the second part of the voting card, on the designated section, whether he is considered a controlling shareholder of the Company and/or having personal interest in approving the resolution, or if not. If the aforementioned shareholder failed to notify as aforesaid, his vote shall not be counted.

23.5 The addresses of the websites of the Securities Authority and the Tel Aviv Stock Exchange Ltd. where one can find the voting card and the position statements, as their meaning in Section 88 of the Companies Law, are: the ISA distribution site http://www.magna.isa.gov.il (hereinafter the “Distribution Site”); and the website of the Tel Aviv Stock Exchange Ltd. http://maya.tase.il. The shareholders are entitled to approach the Company directly and receive from it the voting card and the position statements.

23.6 A Stock Exchange member shall sent via email, at no cost, a link to the voting card and position statements on the Distribution Site, to every shareholder who is an unlisted shareholder and whose shares are listed with the aforesaid Stock Exchange member, unless the shareholder has notified the Stock Exchange member that he is not interested in receiving such a link, as long as the notification was given in regards of a specific securities account and on a date prior to the Record Date or that he is interested in receiving voting cards in the mail, for a certain cost.

23.7 A shareholder whose shares are listed with a Stock Exchange member is entitled to receive the proof of ownership from the Stock Exchange member, with whom his stocks are listed, at the Stock Exchange member’s branch or by mail to his mailing address, paying only the postage fees, if he has asked for it. A request in this matter would be given in advance for a specific securities account.

23.8 The last date for delivering the position statements is no later than 10 days after the Record Date, meaning until Sunday, April 26, 2015.

23.9 The Company does not permit voting via the internet.

23.10 The voting cards and appointment statements that have been received by the Company until the date of this amended report, shall remain in force for the purpose of the general meeting convened on May 25, 2015, unless the shareholder shall notify the Company otherwise.

24. Jurisdiction of the Securities Authority

Pursuant to the provisions of Section 10 of the Transaction with a Controlling Shareholder Regulations and Section 17 of the Private Offering Regulations, within 21 days of filing this report, the Securities Authority may order the Company to provide, within a determined period of time, an explanation, particulars of information and documents relating to the Transaction which is the subject of this report, and instruct the Company to amend this report in such manner and such date determined thereby.

If such an instruction to amend the report was given as aforesaid, the ISA may instruct to postpone the date of the General Meeting to a date occurring no less than 3 business days and no more than 21 days as of the date of publication of the amendment of this report. If such an instruction regarding the postpone of the date of the General Meeting was given, the Company shall publish an immediate report regarding such instruction.

25. Reviewing the documents

A copy of this immediate report together with the addendums thereto shall be made available for review at the Company's offices Sunday to Thursday during normal working hours, after prior arrangement by telephone: 04-9900818, and this until the date of convening the meeting to approve the resolution on the agenda as well as on the Securities Authority website at the address: www.magna.isa.gov.il

26. The Company’s representatives for handling the immediate report The Company’s representatives for handling the immediate report are attorney Itzchak Blau and Karin Appel of the attorney offices Zahavi, Blau & Co., Law Offices & Notary, 96 Yigal Alon St., Tel Aviv, Tel: 03-6252000, Fax: 03-6252020.

Respectfully,

Gil Shimon, CEO Eliezer Parnafes, CFO Tefron Ltd.