DataWave
OTC Bulletin Board : DWVS

September 26, 2005 07:29 ET

DataWave Expands Supplier Relationship with HDS Retail North America to include the U.S. Market; New Agreement Supports Strategy to Rapidly Penetrate U.S. Market

WAYNE, N.J.--(CCNMatthews - Sep 26, 2005) -

DataWave Systems Inc. (OTCBB: DWVS), a premier provider of electronic distribution for the prepaid and stored value markets, today announced that it has expanded its supplier agreement with Hachette Distribution Services Inc. (HDS Retail) beyond Canada to now include the U.S. market as well. HDS' American sister company, Curtis Circulation Company, is the top magazine distributor in America, supplying a network of independent wholesalers and managing the sale of represented titles to the largest American retailing chains. Under the agreement, DataWave will be the exclusive supplier of Point-of-Sale Activation (POSA) technology for Hachette Distribution Services' nearly 300 stores in airports, hotels and commercial kiosks across Canada and the United States.

Josh Emanuel, Chairman and Chief Executive Officer, stated, "We look forward to supplying the entire solution for HDS' POSA needs in both the U.S. and Canadian markets. Our success and experience with the Canadian program made DataWave the best choice for our client. DataWave has already deployed its solutions at more than 60 locations across the U.S., including New York, Chicago and California. Our POSA program will allow stores to sell prepaid long distance, wireless and eventually other prepaid and stored value products which will increase the category sales."

Kathy Keates, Category Manager of HDS Retail North America, commented, "We already had a very successful relationship with DataWave for our Canadian market, so when we decided to expand the prepaid products and services to the U.S., DataWave was our first choice. DataWave tailored a competitive long distance program to our corporate needs and accompanied it with a wireless program, driving sales growth in the calling card category. Data Wave's point of sale activated merchandise eliminates the risks we had experienced when carrying live product, while allowing us detailed reporting and improved inventory control. Data Wave's customer service and commitment to the program made this new North American launch a success."

Mr. Emanuel continued, "Our state-of-the art proprietary technologies resolve vital issues for retailers associated with inventory risk and shrinkage, yet 90% of our transaction volume is still within Canada. This represents an enormous untapped opportunity within the U.S. Our expanded relationship with HDS further illustrates our strategy to leverage our dominant position within Canada to rapidly penetrate the sizeable U.S. market."

About Hachette Distribution Services

Hachette Distribution Services, a subsidiary of Lagardere, aims to provide access to a wide range of ideas and cultural products. The world leader in print media distribution, Hachette Distribution Services operates the top international chain of retail outlets for cultural, multimedia and entertainment products (3,800 stores) under internationally known banner names (Relay, Virgin) and brands with a strong local identity (Payot, Le Furet du Nord).

About DataWave

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.

This press release contains forward-looking statements and projections concerning DataWave's plans, strategies, expectations, predictions and financial projections concerning the Company's future activities and results of operations and other future events or conditions, which are "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. Statements in this press release, and elsewhere, that look forward in time or include anything other than historical information involve risks and uncertainties that may affect the Company's actual results of operations. These statements by the Company are subject to certain risks, including, among others, future demand for its products and brand, competition from other businesses providing similar products, the ability to maintain profitability and control expenses and the Company's ability to successfully execute its business strategy. These and other risks and uncertainties are discussed in more detail 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 eh 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.

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