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DWVS News InComm Agrees to Acquire DataWave for $0.62 Per Share

WAYNE, N.J.--(BUSINESS WIRE)--DataWave Systems Inc. (OTCBB: DWVS), the leading provider of prepaid and stored-value delivery systems in Canada with operations in the United States, announced that its stockholders have approved the proposed acquisition of DataWave by InComm Holdings, Inc. in an all-cash merger transaction valued at approximately $36 million. 99.6% of more than 40 million votes were cast in favor of the merger. The DataWave stockholders approved the transaction at the company’s annual meeting, held on December 14, 2006.

Under the terms of the approved merger transaction, InComm will acquire DataWave, which will become a wholly-owned subsidiary of InComm, and DataWave will cease to be a public company and its stock will no longer be publicly traded. Closing of the merger transaction is subject to satisfaction of other closing conditions, and is anticipated to occur on January 2, 2007. The cash consideration payable to DataWave shareholders is subject to working capital adjustments and an indemnification holdback.

About InComm

InComm is an innovator in prepaid products and point-of-sale technology specializing in retail prepaid services, subscriber services and payment solutions that are changing the way consumers purchase. InComm provides the most robust product portfolio in the industry including wireless airtime, financial debit cards, gift cards, music downloads, ring tones, games, long-distance cards, online games, broadband, digital television as well as bill payment solutions. InComm partners with consumer brand leaders around the world to provide more than 145,000 retail locations the products and services their customers demand. Since 1992, InComm's patented technology has made the buying process easier for consumers while streamlining the selling process for product and retail partners. To learn more about InComm, visit www.incomm.com or call 1.800.352.3084. InComm is headquartered in Atlanta with offices in Canada, Colorado, Texas, Florida, New Jersey, Puerto Rico and the United Kingdom.

About DataWave (www.datawave.com)

DataWave has been an innovator and developer of prepaid and stored-value programs and merchandising solutions since it was founded in 1994. DataWave pioneered systems that allow for point-of-sale activation of high value, high shrinkage products, such as cash cards, prepaid phone cards and prepaid wireless time. These systems work equally well over the Internet, through intelligent freestanding vending machines and POSA terminals, or with various card activation devices, including cash registers.

Additional Information about the Merger

In connection with the proposed merger of DataWave and InComm Holdings, DataWave has filed relevant materials with the SEC, including a proxy statement. SHAREHOLDERS OF DATAWAVE ARE URGED TO READ THESE MATERIALS FOR IMPORTANT INFORMATION ABOUT THE MERGER. The proxy statement and other relevant materials (when they become available) and any other documents filed by DataWave with the SEC may be obtained free of charge at the SEC’s website at www.sec.gov.

This press release contains “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Words such as “expect”, “believe”, “anticipate”, “may”, “will”, “plan”, “intend”, “estimate”, “could”, and other similar expressions are intended to identify these forward-looking statements. Examples of forward-looking statements in this release include the expected timing of closing the merger, DataWave does not assure the future results or outcome of the matters described in forward-looking statements; rather, these statements merely reflect current expectations of the approximate outcomes of the matters discussed. These statements by DataWave are subject to certain risks, including, among others, the ability of the parties to perform their obligations under the merger agreement, general economic conditions, reactions from customers and suppliers from the announcement of the merger, and other risks detailed from time to time in the Company’s periodic reports filed with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, which are available at the SEC website at www.sec.gov.

"DataWave" is a registered trademark of the Company. All other trademarks and trade names referred to are the property of their respective owners.