On August 7, 2012 the completion of the 2012 Annual Meeting of Shareholders of Sigma Designs, Inc. the Board of Directors of the company appointed Maury Austin to serve as a director. The Board also appointed Mr. Austin as a member of the Audit Committee, Compensation Committee and Corporate Governance and Nominating Committee. Mr. Austin will serve as the Chairman of the Audit Committee.

Mr. Austin's appointment to the Board was made pursuant to the terms of a settlement agreement dated August 2, 2012 by and among the company and Potomac Capital Partners III, L.P. and certain entities and natural persons listed on Exhibit A of the Settlement Agreement and their affiliates. Mr. Austin's appointment was a result of a collaborative process conducted by the Board and Potomac to identify a qualified, mutually agreeable fifth director. Except for the Settlement Agreement, there were no arrangements or understandings pursuant to which Mr. Austin was appointed as a director, and there have been no related party transactions between Mr. Austin and the company.