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Filed pursuant to Rule 424(b)(3)
File No. 333-09231
PROSPECTUS
NAVARRE CORPORATION
180,000 Shares of Common Stock
This is a Prospectus for up to 180,000 shares of no par value common stock of
Navarre Corporation ("Navarre" or the "Company") that may be offered by the
shareholders named in this Prospectus (the "Selling Shareholders"). The
180,000 shares of common stock are issuable upon the exercise of a warrant
that Navarre rendered to Hamilton Investments, Inc. ("Hamilton") on December
16, 1993, in connection with Hamilton underwriting Navarre's initial public
offering. Hamilton received a five-year warrant entitling it to purchase
90,000 shares of Navarre common stock for $7.80 per share.
On June 21, 1996, Navarre declared a two-for-one stock split on its common
stock. Under the terms of the warrant, Hamilton became entitled to purchase
180,000 shares, and its exercise price was halved to $3.90 per share.
Hamilton has transferred the right to purchase some of the shares underlying
its warrant to the Selling Shareholders.
Navarre will receive proceeds from the sale of the shares by the Selling
Shareholders only if the Selling Shareholders exercise their warrants to
purchase the common stock covered by this Prospectus. Navarre will bear all
expenses of the offering other than underwriting discounts and commissions
that the Selling Shareholders may incur in connection with the sale of their
shares. Navarre and the Selling Shareholders have agreed to indemnify each
other against certain liabilities including liabilities arising under the
Securities Act of 1933.
Navarre's common stock is quoted on the Nasdaq National Market under the
symbol "NAVR."
On November 24, 1998, the last reported sale price of Navarre's common
stock on the Nasdaq National Market was $5.0625.
This Investment Involves a High Degree of Risk. You should purchase common
stock only if you can afford a total loss of your investment. SEE "RISK
FACTORS" BEGINNING ON PAGE 2 OF THIS PROSPECTUS.
The Selling Shareholders have advised Navarre that they intend to sell their
shares from time to time in transactions on the Nasdaq National Market at
prices prevailing at the time of the sale. They have also advised Navarre
that, as of the date below, they have made no arrangement with any brokerage
firm for the sale of their shares. The Selling Shareholders may be deemed to
be "underwriters" within the meaning of the Securities Act, in which case any
commissions received by a broker or dealer may be deemed to be underwriting
commissions or discounts under the Securities Act.
THE SECURITIES AND EXCHANGE COMMISSION OR STATE SECURITIES COMMISSION HAVE
NOT APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR ACCURATE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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THE DATE OF THIS PROSPECTUS IS NOVEMBER 25, 1998
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THE COMPANY
Navarre, a Minnesota corporation formed in 1983, is a major distributor of
music, software and interactive CD-ROM and digital versatile disc ("DVD")
products. Through its subsidiary, Net Radio Corporation, Navarre also owns
and operates NetRadio Network, a leading audio content provider on the
Internet. Navarre sells music, software and DVDs to retailers, wholesalers
and rackjobbers.
The Company operates through two principal divisions, its Computer Products
Division and its Music Products Division. The only major distributor to
distribute both music and software, the Company is recognized as an industry
leader in the distribution of consumer software in addition to being
recognized as a leader in the distribution of independent music labels and
their artists. The Company's product line contains over 30,000 (SKUs of
compact discs, cassettes, personal computer software and interactive CD-ROM
software as well DVDs sold to over 500 customers with over 9,000 locations
throughout the United States. The Company's broad base of customers include
(i) wholesale clubs, (ii) mass merchandisers, (iii) computer specialty
stores, (iv) music specialty stores and (v) book stores. The Company also
ships directly to consumers to fill orders generated by NetRadio Network.
NetRadio Network was one of the first Internet-only radio networks and is
currently one of the largest Internet broadcasters of originally programmed
audio content.
The Company's executive offices are located at 7400 49th Avenue North, New
Hope, Minnesota 55428 and its phone number is (612) 535-8333.
RISK FACTORS
This Prospectus contains forward-looking statements based on current
expectations which involve risks and uncertainties. Actual results and the
timing of certain events may differ materially from those projected in such
forward-looking statements due to a number of risk factors, including those
set forth below. Navarre has tried, wherever possible, to identify these
forward-looking statements by using words such as "believe," "anticipate,"
"estimate," "expect" and similar expressions. Navarre undertakes no
obligation to release publicly the results of any revisions to any such
forward-looking statements that may be made to reflect events or
circumstances after the date of this Prospectus or to reflect the occurrence
of unanticipated events.
Investing in Navarre common stock is very risky. You should be able to bear
a complete loss of your investment. In addition to the other information in
this Prospectus, you should consider, among other things, the following risk
factors carefully in deciding whether to invest in Navarre's common stock
NAVARRE DEPENDS UPON A FEW SIGNIFICANT CUSTOMERS
In each of the past several years, Navarre has had one or more customers that
has accounted for ten percent or more of the Company's net sales. During the
fiscal year ended March 31, 1998, sales to three customers, CompUSA,
Musicland Stores Corporation and Best Buy, each represented more than ten
percent of net sales. The Company competes with other companies for the
business of each of its customers and there can be no assurance that the
Company will continue to recognize a significant amount of revenue from
sales to any specific customers. If the Company is unable to continue to sell
its products to all or any of these three customers or is unable to continue
to maintain its sales to these customers at their current levels, and is
unable to find other customers to replace the list sales, there might be an
adverse impact on the Company's revenues and future profitability.
NAVARRE'S BUSINESS CAN BE SEASONAL
Much of the Company's business is seasonal in nature with a higher percentage of
sales during the second half of the calendar year. As a distributor of products
ultimately sold at retail, the Company's business is affected by the pattern of
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seasonality common to other suppliers of retailers, particularly the holiday
selling season. Historically, more than 70% of the Company's sales and a
substantial portion of the Company's profits have been in the third and
fourth quarters of the calendar year. Due to the lower level of sales during
the off periods, the Company has historically incurred losses during these
periods. Because of this seasonality, if the Company experiences a weak
holiday season, it could significantly affect the Company's profitability for
the entire year.
NAVARRE DEPENDS UPON BANK BORROWINGS TO SUPPORT ITS BUSINESS
The Company has relied upon bank borrowings to finance its expansion,
primarily for inventory and accounts receivable financing and currently has a
$45.0 million credit facility in place. The Company believes that it may be
necessary for it to acquire additional bank financing in the future depending
upon the growth of its business and the possible financing of acquisitions.
If the Company is unable to obtain additional bank financing, its future
growth and profitability would be adversely affected. Under the terms of the
Company's credit facility, borrowings are dependent upon the eligibility of
accounts receivable and inventory, and certain other covenants in the
discretion of the bank.
NAVARRE'S INDUSTRY TYPICALLY EXPERIENCES LOW INDUSTRY MARGINS
Competition in the prerecorded music and personal computer software
distribution industry is often based on price, and distributors such as the
Company generally experience low gross and operating margins. Consequently,
the Company's profitability is highly dependent upon achieving expected sales
levels as well as effective cost and management controls. Any erosion in the
Company's gross profit margins could affect the Company's ability to maintain
profitability.
NAVARRE IS DEPENDENT UPON ITS MANAGEMENT TEAM
Eric H. Paulson, the Company's President and Chief Executive Officer, and
Charles E. Cheney, its Executive Vice President and Chief Financial Officer,
have been with the Company since its inception in 1983 and since 1985,
respectively. Although the Company has invested a substantial amount of time
and effort in developing its total management team, the loss of either Mr.
Paulson or Mr. Cheney could have a material adverse effect upon the Company.
The Company carries "key person" insurance on the life of Mr. Paulson in the
amount of $1.0 million, one-half of which is pledged to cover any existing
indebtedness to the bank.
NAVARRE MAY HAVE ADDITIONAL SIGNIFICANT WORKING CAPITAL NEEDS
As a distributor of prerecorded music and personal computer software
products, the Company purchases products directly from manufacturers for
resale to retailers. As a result, the Company has significant working
capital requirements, the majority of which are to finance inventory and
accounts receivable. These working capital needs will expand as inventory
and accounts receivable increase in response to the Company's growth. Future
growth will likely require additional working capital. Although the Company
has obtained financing sufficient to meet its requirements to date, there can
be no assurance that the Company will be able to obtain additional financing
upon favorable terms if required in the future.
NAVARRE DEPENDS UPON RECORDING ARTISTS
A portion of the sales of the Company's Music Products Division are made
pursuant to exclusive distribution agreements. The continued growth and
success of the Company depends partly upon its ability to procure and retain
these agreements and sell the underlying recordings. In addition, the
Company is dependent upon these artists and labels to generate additional
quality recordings. In order to procure future marketing agreements, the
Company regularly reviews artists. There are no assurances that the Company
will sign such artists to distribution agreements or that it will be able to
sell recordings under existing distribution agreements. Further, there can
be no assurance that any current distribution agreements will be renewed or
that current agreements will not be terminated.
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TECHNOLOGY DEVELOPMENTS MAY ADVERSELY AFFECT DISTRIBUTION
Prerecorded music and personal computer software have traditionally been
marketed and delivered on a physical delivery basis. Traditionally all the
Company's revenues have been generated from sales to retail and wholesale
channels. If in the future these products are increasingly marketed and
delivered through technology transfers, such as "electronic downloading" to a
retail store or consumer's home, through the Internet or another delivery
mechanism, then retail and distribution could be revolutionized. Although
the Company has begun to participate in Internet fulfillment, its sales in
this area have been limited. If this type of sales of prerecorded music and
personal computer software became widespread, it could have a material
adverse impact on the Company.
RETURNS AND INVENTORY OBSOLESCENCE POSE RISKS TO NAVARRE
The Company maintains a significant investment in product inventory and, like
other companies in this industry, experiences a relatively high level of
product returns as a percentage of revenues. The Company's agreements with
its suppliers generally permit the Company to return products that are in the
suppliers' current product listing. Adverse financial or other developments
with respect to a particular supplier could cause a significant decline in
the value and marketability of its products, and could make it difficult for
the Company to return products to such a supplier and recover its initial
product acquisition costs. Such an event could have a material adverse
effect upon the Company's business and financial results. The Company
maintains a sales return reserve based on its trailing twelve months
experience of sales returns by product line and small inventory obsolescence
reserve. The Company has historically experienced an actual return rate
range of 13% to 20%, depending upon the product, which the Company believes
is in line with the industry experience. Although the Company's past
experience indicates that these levels are adequate to cover potential
returns in these areas, there can be no assurance that these reserves are
adequate or will be adequate in the future. The Company also takes a portion
of its product offerings on consignment in order to lessen its exposure to
this risk.
WHOLESALERS AND RETAILERS MAY CHANGE THEIR METHODS OF DISTRIBUTION
The success of the Company's current sales strategy depends upon its
wholesale and retail customers' continued purchasing of products through the
Company rather than directly from manufacturers, through other distributors
or through other means of distribution. These customers and retailers are
constantly searching for ways to lower costs in an attempt to maintain
competitive prices and meet the pricing demands of consumers. The Company's
business could be adversely affected if its customers decide to purchase
directly from manufacturers, other distributors or other distribution
channels rather than from the Company.
COMPETITION
The prerecorded music and personal computer software distribution industry is
highly competitive. The Company's competitors include other national and
regional distributors as well as certain suppliers that sell directly to
retailers. Certain of these competitors have substantially greater financial
and other resources than the Company. The ability of the Company to
effectively compete in the future depends upon a number of factors, including
its ability to (i) obtain exclusive national distribution contracts and
licenses with independent labels and manufacturers, (ii) maintain its margins
and volume, (iii) expand its sales through a varied range of products and
personalized services, (iv) anticipate changes in the marketplace including
technological developments, and (v) maintain operating expenses at an
appropriate level.
NAVARRE'S MAJORITY-OWNED SUBSIDIARY NET RADIO
In March 1997, the Company, which had an equity interest in Net Radio,
completed an acquisition of all of the outstanding stock of Net Radio in an
effort to increase its presence in the marketplace as a content provider on
the Internet, and to become a publisher and distributor on an international
basis in both music and interactive CD-ROM. Navarre currently owns
eighty-five percent (85%) of the outstanding shares of Net Radio Corporation.
Net Radio owns and operates the NetRadio Network, an Internet-only radio
network. Net Radio has operated at a loss since the Company acquired it,
and Navarre has
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continued to supply NetRadio's working capital needs. There can be no
assurance that Navarre will recoup its investment in NetRadio.
POSSIBLE VOLATILITY OF STOCK PRICE
The stock markets have experienced price and volume fluctuations, resulting
in changes in the market prices of the stock of many companies which may not
have been directly related to the operating performance of those companies.
In addition, the market price of the Company's common stock has fluctuated
significantly since April 1996. The Company believes that factors such as
indications of the market's acceptance of the Company's products and failure
to meet market expectations, as well as general volatility in the securities
markets, could cause the market price of Navarre's common stock to fluctuate
substantially.
PREFERRED STOCK DIVIDEND
On May 1, 1998, the Company issued its Preferred Stock to accredited
investors in a private placement for aggregate consideration of $20.0
million. The Preferred Stock was issued at a price of $13.125 per share and
is convertible into five shares of common stock at any time after June 30,
1998. The holders of the Preferred Stock are entitled to receive cumulative
dividends of 10% per annum payable quarterly beginning July 1, 1998. The
Company's obligation to pay this dividend may adversely affect the Company's
revenues and future profitability.
YEAR 2000
The Company is evaluating the potential impact of what is commonly referred
to as the Year 2000 issue, concerning the inability of certain information
systems to properly recognize and process dates containing the year 2000 and
beyond. The Company has established a Year 2000 team working with every
operational area throughout the Company, and this team has worked with
management to commence the following steps: (i) implementing a Year 2000
Assessment and Testing Plan for all internal information systems and other
systems that contain micro-controllers that may be affected by the Year 2000
date change; (ii) implementing a Year 2000 Assessment and Testing Plan for
all Company products; (iii) communicating with third parties that supply
product to the Company to ensure that they are addressing the Year 2000
issue; and (iv) contingency and disaster recovery planning to ensure Year
2000 problem resolution.
The Company has identified and tested the systems it believes are critical
and the test results indicate that these systems are Year 2000 compliant or
will become Year 2000 compliant with additional software upgrades. The
Company expects to complete testing and establish compliance with respect to
all of systems and products by December 31, 1998, subject to possible
equipment upgrades during 1999 and ongoing communications with third parties.
Regardless of the Year 2000 compliance of the Company's systems and
products, there can be no assurance that the Company will not be adversely
affected by the failure of third parties to become Year 2000 compliant.
To date the Company has not incurred any material expenditures in connection
with identifying or evaluating year 2000 compliance issues. The Company has
incurred the majority of its costs from the opportunity cost of time spent by
employees of the Company evaluating Year 2000 compliance matters generally.
At this time, the Company does not possess information necessary to estimate
the potential financial impact of Year 2000 compliance issues relating to its
non-management information systems, products, vendors, customers and third
parties. Such impact, including the effect of a Year 2000 business disruption
could have a material adverse impact of the Company's financial condition and
results of operations.
Because the Company is still in the discovery and evaluation process of
assessing its overall Year 2000 exposure, it cannot at this time state with
certainty that the Year 2000 issues will not have a material adverse impact
on its financial condition, results of operations and liquidity. Although
the Company considers them unlikely, the Company believes that the following
situations make up the Company's "most reasonably likely worst case Year 2000
scenarios": (i) disruption of a significant
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customer's ability to accept products or pay invoices, (ii) disruption of
suppliers, (iii) disruption of the Company's management information systems
and (iv) disruptions of the Company's non-management information systems.
While the Company recognizes the need for contingency planning, the Company
has not yet developed any specific contingency plans for potential Year 2000
disruptions. The Company does anticipate developing contingency plans for
its most critical areas, but details of such plans will depend on the
Company's final assessment of the problem as well as the evaluation and
success of its remedial efforts.
USE OF PROCEEDS
The Company will only receive proceeds from sales of the shares if the
Selling Shareholders exercise warrants to purchase 180,000 shares of Common
Stock at $3.90 per share. If all warrants are exercised, the Company will
receive aggregate proceeds of $702,000. There can be no assurance that any
of the warrants will be exercised. If any of the warrants are exercised, the
Company intends to use the proceeds for working capital purposes.
SELLING SECURITY HOLDERS
In connection with the Company's initial public offering in December, 1993,
the Company issued to its underwriter Hamilton, a five-year warrant to
purchase 90,000 shares of Common Stock exercisable at $7.80 per share. On or
about June 21, 1996, the Company declared a two-for-one stock split. As a
consequence of the stock split, the shares represented by the Hamilton
warrant doubled to 180,000 and the exercise price was reduced to $3.90 per
share. Hamilton has transferred some of the shares represented by its
warrant to the Selling Shareholders set forth below.
The following table sets forth certain information with respect to the
beneficial ownership of the Company's common stock by all Selling
Shareholders.
<TABLE>
<CAPTION>
NUMBER OF SHARES OF MAXIMUM NUMBER NUMBER OF SHARES
COMMON STOCK UPON OF SHARES TO BE BENEFICIALLY OWNED
NAME EXERCISE OF WARRANT SOLD(1) AFTER OFFERING(1)
---- ------------------- --------------- ------------------
<S> <C> <C> <C>
Hamilton Investments, Inc. . . .144,000. . . . . . . . . .144,000 . . . . . . .0
Mark Bartholomay(2). . . . . . . .7,200. . . . . . . . . . .7,200 . . . . . . .0
Goeffrey S. Parker(2). . . . . . .7,200. . . . . . . . . . .7,200 . . . . . . .0
Randy L. Hines(2). . . . . . . . .5,400. . . . . . . . . . .5,400 . . . . . . .0
Douglas McConnell(2) . . . . . . .5,400. . . . . . . . . . .5,400 . . . . . . .0
Terry T. Stewart(2). . . . . . . .5,400. . . . . . . . . . .5,400 . . . . . . .0
William M. Gerstner(2) . . . . . .2,700. . . . . . . . . . .2,700 . . . . . . .0
Joseph W. Kacergis(2). . . . . . .2,700. . . . . . . . . . .2,700 . . . . . . .0
- -----------------------------------------------------------------------------------------
Total 180,000 180,000 0
</TABLE>
____________________
(1) Assumes all warrant shares are exercised and sold.
(2) Transferees of Hamilton who acquired their shares in an authorized transfer
under the warrant issued to Hamilton.
PLAN OF DISTRIBUTION
The Selling Shareholders have advised the Company that they may sell their
shares from time to time in one or more transactions (which may include block
transactions) on Nasdaq at market prices prevailing at the time of the sale
or at prices otherwise negotiated. The Selling Shareholders may, without
limitation, sell their shares by one or more of the following: (i)
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a block trade in which the broker or dealer so engaged will attempt to sell
the securities as agent but may position and resell a portion of the block as
principal to facilitate the transaction; (ii) purchases by a broker or dealer
as principal and resale by such broker or dealer for its account pursuant to
this Prospectus; and (iii) ordinary brokerage transactions and transactions
in which the broker solicits purchasers.
The Selling Shareholders have also advised the Company that, as of the
Prospectus' date, they have made no arrangement with any broker for the sale
of their shares. Underwriters, brokers or dealers may participate in such
transactions as agents and may, in such capacity, receive brokerage
commissions from the Selling Shareholders or purchasers of such securities.
Such underwriters, brokers or dealers may also purchase shares and resell
such shares for their own account in the manner described above. The Selling
Shareholders and such underwriters, brokers or dealers may be considered
"underwriters" as that term is defined by the Securities Act of 1933,
although the Selling Shareholders disclaim such status. Any commissions,
discounts or profits received by such underwriters, brokers or dealers in
connection with the foregoing transactions may be deemed to be underwriting
discounts and commissions under the Securities Act of 1933.
INTERESTS OF NAMED EXPERTS AND COUNSEL
The validity of the issuance of the common stock offered by this Prospectus
will be passed upon for the Company by Lindquist & Vennum P.L.L.P.,
Minneapolis, Minnesota.
The consolidated financial statements of Navarre Corporation at March 31,
1998 and 1997, and for each of the fiscal years or periods ended March 31,
1998, 1997 and 1996 appearing in Navarre Corporation's Annual Report on Form
10-K for the year ended March 31, 1998, have been audited by Ernst & Young
LLP, independent auditors, as set forth in their report. The consolidated
financial statements are incorporated by reference in reliance upon the
authority of such firm as experts in accounting and auditing.
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
The Company's Bylaws provide for indemnification of directors to the full
extent permitted by the Minnesota Business Corporation Act. Minnesota
Statutes Section 302A.521 provides that a Minnesota corporation shall
indemnify any director, officer employee or agent of the corporation made or
threatened to be made a party to a proceeding, by reason of the former or
present official capacity of the person, against judgments, penalties, fines,
settlements, and reasonable expenses incurred by the person in connection
with the proceeding if certain statutory standards are met. "Proceeding"
means a threatened, pending or completed civil, criminal, administrative,
arbitration or investigative proceeding, including one by or in the right of
the Company.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
registrant pursuant to the foregoing provisions, the registrant has been
informed that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is
therefore unenforceable.
AVAILABLE INFORMATION
The Company files annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission (the
"Commission"). You can inspect and copy these reports and information at the
public facilities maintained by the Commission at Judiciary Plaza, Room 1024,
450 Fifth Street, N.W., Washington, D.C. 20549, and are also available at the
Commission's Regional Offices at 7 World Trade Center, 13th Floor, New York,
New York 10048, and Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material also can be obtained at
prescribed rates from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549.
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The Commission also maintains a website that contains reports, proxy and
information statements and other information regarding the Company. The
address of the Commission's website is http://www.sec.gov.
Navarre common stock is quoted on the Nasdaq National Market ("Nasdaq"). The
Company has filed with the Commission a Registration Statement under the
Securities Act of 1933, as amended, with respect to the shares offered by
this Prospectus. This Prospectus does not contain all of the information set
forth in the Registration Statement and its exhibits, certain parts of which
were omitted as permitted by the rules and regulations of the Commission.
Such additional information may be obtained from the Commission's principal
office in Washington, D.C. Statements contained in this Prospectus or in
any document incorporated in this Prospectus by reference as to the content
of any contract or other document referred to are not necessarily complete,
and in each instance reference is made to the copy of such contract or other
document filed as an exhibit to the Registration Statement or each other
document, each such statement is qualified in all respects by such reference.
No person is authorized to give information or to make any representations,
other than those contained or incorporated by reference in this Prospectus,
in connection with this offering, and, if given or made such information or
representations must not be relied upon as having been authorized by the
Company. This Prospectus does not constitute an offer to sell or a
solicitation of an offer to buy any securities other than the registered
securities to which it relates. This Prospectus does not constitute an offer
to sell or a solicitation of an offer to buy any securities in any
jurisdiction to any person to whom it is unlawful to make such an offer or
solicitation in such jurisdiction. Neither the delivery of this Prospectus
nor any sale made hereunder shall under any circumstances, create any
implication that there has been no change in the affairs of the Company since
the date of this Prospectus, or that the information contained or
incorporated by reference in this Prospectus is correct as of any time
subsequent to its date.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, filed with the Commission by the Company under the
Exchange Act (File No. 0-22982) are incorporated by reference in this
Prospectus:
(i) The Company's Report on Form 10-K for the year ended March 31,
1998;
(ii) The Company's Report on Form 10-Q for the quarter ended September
30, 1998;
(iii) The Company's Report on Form 10-Q for the quarter ended June 30,
1998;
(iv) The Company's Current Report on Form 8-K dated May 15, 1998;
(v) The Company's definitive Proxy Statement dated May 29, 1998 for
its Special Meeting of Shareholders held June 19, 1998;
(vi) The Company's definitive Proxy Statement dated July 30, 1998 for
its Annual Meeting of Shareholders held September 3, 1998; and
(vii) The description of the Company's Common Stock as set forth in the
Company's Registration Statement on Form 8-A dated November 1993
including any amendments or reports filed for the purpose of
updating such information.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15 of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the securities covered by this Prospectus
shall also be deemed to be incorporated by reference in this Prospectus from
the date of filing of such documents or reports. Any statement contained in
a document incorporated or deemed to be incorporated by reference shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained in this Prospectus or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
This Prospectus incorporates documents by reference which are not presented
or delivered with this Prospectus. Such documents (other than exhibits to
such documents, unless such exhibits are specifically incorporated by
reference to such
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documents) are available, without charge, to any person, including any
beneficial owner, to whom this Prospectus is delivered, on written or oral
request, to Navarre Corporation, 7400 49th Avenue North, New Hope, Minnesota
55428, Attention: Investor Relations, or by telephone at (612) 535-8333.
--------------------
This Prospectus, including the information incorporated by reference,
contains forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. Actual results could differ significantly from those projected or
contemplated in the forward-looking statements as a result, in part, of the
risk factors set forth elsewhere in this Prospectus. In connection with the
forward-looking statements which appear in these disclosures, prospective
purchasers of the Company's Common Stock offered hereby should carefully
review all of such risk factors.
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