FUNimation Channel and Optical Entertainment Network Sign Distribution Agreement

-- Houston residents to have access to top-rated anime programming
through FUNimation Entertainment's 24-hour, digital channel --

FORT WORTH, TX -- June 29, 2006 -- FUNimation Entertainment, a
wholly-owned subsidiary of Navarre Corporation (NASDAQ: NAVR) and the market
share leader for home video sales of Japanese animation in the United
States, announced today that the company has finalized a distribution
agreement with Optical Entertainment Network (OEN), the leading provider of
IPTV and broadband services optimized for fiber-to-the-home (FTTH). The
agreement makes the FUNimation Channel part of the FISION service,
OEN's line-up of 400 IPTV channels, and available to Houston area
residents. The FUNimation Channel is a 24-hour digital channel featuring
programming from top anime brands in the United States and will be added to
OEN's FISION lineup in the fall of 2006.

“We are excited with the progress that the FUNimation Channel has made
in the last few months,” said Gen Fukunaga, president and CEO of
FUNimation Entertainment. “Optical Entertainment has designed an offering
that will provide the Houston area with a great line-up of alternative
programming. Houston area residents will now be able to get top-rated
anime programming through our 24-hour digital channel.”

“FUNimation's top rated anime programming will be a great addition to
our existing line-up of channels and we are thrilled by their belief in
our offerings,” said Jo-lynn Foo, VP of Programming at OEN. “Offering
high quality programming is critical and we believe that the
top-quality anime product will be very successful for us.”

OEN created FISION, the first and only integrated service for IPTV,
Internet, Voice, Video-On-Demand (VOD) and other broadband applications,
specifically to deliver on the superior video quality and virtually
unlimited bandwidth of FTTH technology and the only service to make all of
its content available for license to other communities in the US and
abroad. OEN has acquired programming agreements for IPTV distribution
from top television networks and will deliver 400 television channels,
including over 50 channels of High Definition Television (HDTV) to
subscribers, the most channels deployed anywhere to date.

FUNimation is working with OlympuSAT, a leading distributor of
independent digital programming networks, for the distribution of the
FUNimation Channel. OlympuSAT is the exclusive distributor of the FUNimation
Channel, which is now available to video service providers across the

About Navarre Corporation
Navarre Corporation (NASDAQ: NAVR) is a publisher and distributor of
physical and digital home entertainment and multimedia products,
including PC software, CD audio, DVD and VHS video, video games and
accessories. Since its founding in 1983, the company has established distribution
relationships with customers across a wide spectrum of retail channels
which includes mass merchants, discount, wholesale club, office and
music superstores, military and e-tailers nationwide. The company
currently provides its products to over 18,000 retail and distribution center
locations throughout the United States and Canada. Navarre has expanded
its business to include the licensing and publishing of home
entertainment and multimedia content, primarily through the acquisitions of
Encore Software, Inc., BCI Eclipse Company, LLC, FUNimation Productions,
Ltd. and The FUNimation Store, Ltd. For more information, please visit the
company's web site at

About FUNimation Entertainment
FUNimation® Entertainment, a wholly-owned subsidiary of Navarre
Corporation (NASDAQ: NAVR), is the leading company for home video sales of
Japanese animation in the United States. FUNimation is known for acquiring
top-rated anime series from Japan and for developing some of North
America's most popular anime series. The company has a proven formula for
launching and advancing brands, and manages a full spectrum of rights
for most of its brands including broadcasting, licensing, production,
internet, and home video sales and distribution.

About Optical Entertainment
Optical Entertainment Network is a Houston, Texas based company
providing the first major market deployment of Video, Internet and Voice to
residential and commercial customers over a system specifically designed
to optimize fiber-to-the-home (FTTH) technology. OEN has signed the
largest number of IPTV carriage agreements to date, acquired directly
with programming networks and has developed a business model that will
enable it to license content to other FTTH communities around the US and
overseas. The company is a platinum member of the FTTH Council. More
information can be found at the company's website at

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