NOTE PURCHASE AGREEMENT

     NOTE  PURCHASE  AGREEMENT,  dated as of  December  21,  2005,  by and among
Integrated  Technologies  & Systems,  Inc.,  a British  Virgin  Islands  company
("Seller"),  Sigma  Opportunity  Fund, LLC, a Delaware limited liability company
("Purchaser"), and Integrated Data Corp., a Delaware corporation ("IDC").

     WHEREAS,  Seller is the beneficial owner of a Promissory Note (the "Note"),
dated  February 1, 2005, in the aggregate  principal  amount of $600,000,  which
Note is  convertible  into 7,500,000  shares (the  "Datawave  Shares") of common
stock ("Common Stock") of Datawave Systems Inc. (the "Company");

     WHEREAS,  IDC, an  affiliate  of the  Company,  acquired  the Note from the
Company for investment  without a view to distribution in partial  consideration
of the termination of a license to certain of the  intellectual  property of the
Company;

     WHEREAS,  Seller,  an  affiliate  of IDC,  acquired  the Note  from IDC for
investment  without a view to distribution in  consideration of the repayment of
certain loans made from Seller to IDC;

     WHEREAS,  subsequent to the acquisition of the Note by Seller from IDC, the
Company requested Seller to transfer the Note to Purchaser;

     WHEREAS,  Seller and IDC  believe  that it is in the best  interest  of the
Company, IDC and Seller to transfer the Note to Purchaser;

     WHEREAS, the Seller now desires to sell to Purchaser and Purchaser
desires to purchase from the Seller the Note on the terms and subject to the
conditions set forth in this Agreement;

     NOW, THEREFORE, the parties hereto hereby agree as follows:

Section 1.  Sale of Note.
            ------------

     1.1. Sale and Purchase of Note. At the Closing,  upon the terms and subject
          -------------------------
to the conditions  contained in this  Agreement,  Seller shall sell to Purchaser
and Purchaser shall purchase from Seller all right, title and interest in and to
the Note for a purchase price of ONE MILLION FIVE HUNDRED THOUSAND  ($1,500,000)
DOLLARS (the  "Purchase  Price").  In the event that the Datawave  Shares become
registered for resale by Purchaser,  Purchaser shall pay to Seller an additional
$475,000  within  twenty  days  after  the  effectiveness  of  the  registration
statement registering such shares for resale (the "Contingent Purchase Price")

     1.2.  Closing.  The closing of the sale and purchase of the Note shall take
           -------
place  simultaneously  with the execution and delivery of this  Agreement at the
offices of Moomjian & Waite, LLP at 100 Jericho  Quadrangle,  Jericho,  New York
11753,  or at such other time and place as Purchaser  and Seller shall  mutually
agree (the "Closing").


<PAGE>

1.3. Deliveries at the Closing. At the Closing:
     -------------------------

     (a) Purchaser  shall deliver the Purchase  Price to Seller by wire transfer
to such account as Seller may designate to Purchaser prior to the Closing.

     (b)  Seller  shall  deliver to  Purchaser  (i) the Note,  together  with an
assignment  thereof  assigning  the Note to  Purchaser,  and (ii) an  opinion of
Seller's  counsel as to the  availability of an exemption from the  registration
requirements under the Securities Act of 1933 (the "Securities Act") in the form
mutually agreed.

     (c) The  Company and  Purchaser  shall  execute and deliver a  Registration
Rights  Agreement  (the  "Registration  Rights  Agreement") in the form mutually
agreed.

Section 2.  Representations and Warranties of Purchaser.
            -------------------------------------------

     Purchaser hereby represents and warrants to Seller as follows:

     2.1.  Authorization.  Purchaser  has  all  requisite  corporate  power  and
           -------------
authority to execute,  deliver and perform this  Agreement and the  transactions
contemplated hereby, and the execution, delivery and performance by Purchaser of
this Agreement has been duly authorized by all requisite action by Purchaser and
this  Agreement,  when executed and delivered by Purchaser,  constitutes a valid
and binding obligation of Purchaser, enforceable against Purchaser in accordance
with its terms, subject to applicable  bankruptcy,  insolvency,  reorganization,
fraudulent  conveyance,  moratorium or other similar laws  affecting  creditors'
rights and remedies  generally,  and subject,  as to enforceability,  to general
principles  of  equity  (regardless  of  whether  enforcement  is  sought  in  a
proceeding at law or in equity).

     2.2. Investment  Representations.  Purchaser hereby represents and warrants
          ---------------------------
to Seller as follows:

          (a) Available Information.  Purchaser acknowledges that it is familiar
              ---------------------
with the business,  management,  operations,  financial condition and affairs of
the Company and is therefore able to evaluate the merits and risks of a purchase
of the Note.

          (b) Restricted Securities. Purchaser understands and agrees that, when
              ---------------------
acquired by the Purchaser pursuant to the Agreement, the Note will be restricted
within the meaning of the  Securities  Act, and may not be sold,  transferred or
otherwise  disposed  of  without  registration  under the  Securities  Act or an
exemption therefrom.

          (c) Legend.  Purchaser  understands and acknowledges that the Note and
              ------
the  certificates  representing  the Datawave Shares upon conversion of the Note
shall bear a legend  substantially  as follows until (i) such  securities  shall
have been  registered  under the Act;  or (ii) in the opinion of counsel for the
Company such  securities may be sold without  registration  under the Securities
Act as well as any applicable "Blue Sky" or state securities laws:

          "THE   SECURITIES REPRESENTED  BY  THIS  INSTRUMENT HAVE  NOT BEEN
          BEEN REGISTERED  UNDER THE SECURITIES ACT OF 1933, AS


                                       2
<PAGE>


          AMENDED,  OR THE  SECURITIES  LAWS OF ANY STATE,  AND  MAY NOT  BE
          SOLD, TRANSFERRED,  ASSIGNED, PLEDGED OR HYPOTHECATED  UNLESS  AND
          UNTIL REGISTERED UNDER SUCH ACT AND/OR APPLICABLE STATE SECURITIES
          SECURITIES LAWS, OR UNLESS THE CORPORATION HAS RECEIVED AN OPINION
          OF  COUNSEL  OR  OTHER  EVIDENCE,  REASONABLY  SATISFACTORY TO THE
          CORPORATION  AND  ITS  COUNSEL,  THAT  SUCH  REGISTRATION  IS  NOT
          REQUIRED."

          (d) Investment.  The Note and, until  effectiveness  of a registration
              ----------
statement registering the Datawave Shares for resale by Purchaser,  any Datawave
Shares to be acquired by  Purchaser,  will be acquired for  investment  purposes
only  for  Purchaser's  own  account  and not  with a view  to the  distribution
thereof.

          (e) Accredited Investor. Purchaser is an "Accredited Investor" as that
              -------------------
term is defined in Rule 501 of  Regulation D  promulgated  under the  Securities
Act.  Purchaser  is able to bear the  economic  risk of the purchase of the Note
pursuant  to  the  terms  of  this  Agreement,  including  a  complete  loss  of
Purchaser's investment in the Note.

          (f) Financial  Experience.  The Purchaser represents that by reason of
              ---------------------
Purchaser's  business or  financial  experience  or the  business  or  financial
experience of Purchaser's  professional  advisors who are unaffiliated  with and
who are not  compensated  by either  Seller or the Company or any  affiliate  or
selling agent of either Seller or the Company, directly or indirectly, Purchaser
has the capacity to protect  Purchaser's  own interests in  connection  with the
transactions contemplated by this Agreement.

     Purchaser understands that the foregoing representations and warranties are
to be relied  upon by Seller  as a basis for  exemption  of the sale of the Note
under the Securities Act and under the securities laws of all applicable  states
and for other  purposes.  Purchaser  warrants that the  information  provided to
Seller is true and correct as of the date hereof.

Section 3.  Representations  and  Warranties  and  Covenants  of Seller and IDC.
            -------------------------------------------------------------------

     Seller and IDC hereby jointly and severally represent, warrant and covenant
to Purchaser as follows:

     3.1.  Ownership of Note.  The Note is solely owned by Seller,  beneficially
           -----------------
and of  record,  free and  clear  of any and all  liens,  encumbrances,  claims,
charges  and  assessments,  and  Seller has the full and sole  right,  power and
authority to sell, transfer and deliver the Note. The Note is not subject to any
options or contractual restrictions with respect to transferability.

     3.2. Authorization.  Seller and IDC each have all requisite corporate power
          -------------
and  authority  to  execute,   deliver  and  perform  this   Agreement  and  the
transactions contemplated hereby, and the execution, delivery and performance by
Seller  and IDC of this  Agreement  has been duly  authorized  by all  requisite
action by Seller and IDC and this  Agreement,  when  executed  and  delivered by
Seller and IDC,  constitutes  a valid and binding  obligation of Seller and IDC,
enforceable  against  Seller and IDC in  accordance  with its terms,  subject to
applicable

                                       3

<PAGE>



bankruptcy,  insolvency,  reorganization,  fraudulent conveyance,  moratorium or
other  similar laws  affecting  creditors'  rights and remedies  generally,  and
subject,  as to  enforceability,  to general principles of equity (regardless of
whether enforcement is sought in a proceeding at law or in equity).

     3.3. Approvals and Consents. No action, approval, consent or authorization,
          ----------------------
including, but not limited to, any action, approval, consent or authorization by
any governmental or  quasi-governmental  agency,  commission,  board, bureau, or
instrumentality  is  necessary  or  required  as to  Seller  or IDC in  order to
constitute  this  Agreement as a valid,  binding and  enforceable  obligation of
Seller and IDC in accordance with its terms.

     3.4 Board of  Directors.  It is  contemplated  that a designee of Purchaser
         -------------------
will be  nominated  to the Board of  Directors  of the  Company.  IDC and Seller
acknowledge  that,  absent a reasonable basis to vote otherwise,  each will vote
the shares of Common Stock held by them in favor of the nominees to the board of
directors recommended by management of the Company.

     3.5 Guarantee.  In the event that the Note is for any reason required to be
         ---------
transferred  back to Seller or the Datawave  Shares  underlying the Note for any
reason  unable to be registered  for resale by Purchaser,  IDC, or another party
designated by IDC and  acceptable to  Purchaser,  shall  transfer or cause to be
transferred to Purchaser 7,500,000 shares of Common Stock (subject to adjustment
for stock splits,  stock dividends,  reorganizations  and the like) which may be
transferred  to  Purchaser  pursuant  to  an  appropriate  exemption  under  the
Securities  Act and that may be registered  for resale by  Purchaser.  Upon such
transfer of shares,  Purchaser shall transfer the Note back to Seller. The party
transferring  such shares,  if other than  Seller,  shall be entitled to receive
from Seller a  proportionate  amount of the Purchase  Price paid by Purchaser to
Seller and the  Contingent  Purchase  Price to be paid by Purchaser.  IDC agrees
that,  until  such time as the  Datawave  Shares  are  registered  for resale by
Purchaser,  it shall  retain a minimum  of  7,500,000  shares  of  Common  Stock
(subject to  adjustment  as provided  above)  that would be so  transferable  to
Purchaser.

     3.6  Registration  Expenses.  Seller  agrees  that it shall  pay all of the
          ----------------------
out-of-pocket  expenses of the Company  incurred in connection with  preparation
and  filing  of  the  registration   statement  to  be  filed  pursuant  to  the
Registration Rights Agreement and any amendments or supplements thereto.

Section 4. Indemnification.
           ---------------

          (a) Seller and IDC agree to indemnify and hold harmless Purchaser (and
its officers,  employees,  partners, agents, affiliates and controlling parties)
from and  against  any and all  losses,  liabilities,  damages,  claims,  suits,
actions,  judgments  or  causes of  action,  assessments,  costs  and  expenses,
including without limitation interest,  penalties,  reasonable  attorneys' fees,
any  and  all  reasonable  expenses  incurred  in  investigating,  preparing  or
defending  against  any  litigation,  commenced  or  threatened,  or  any  claim
whatsoever,  and  any  and  all  amounts  paid in  settlement  of any  claim  or
litigation,  asserted  against,  resulting  to,  imposed  upon,  or  incurred or
suffered by  Purchaser,  as a result of third party claims  resulting or arising
from any inaccuracy in or breach or nonfulfillment of or any alleged  inaccuracy
in or  breach  or  nonfulfillment  of any of

                                       4
<PAGE>



the representations,  warranties,  covenants or agreements made by Seller or IDC
in this Agreement;  provided, however, that the indemnity agreement contained in
                    --------  -------
this  Subsection  4(a) shall not apply to amounts paid in settlement of any such
      ----------------
loss, claim, damage, liability, or action if such settlement is effected without
the consent of Seller or IDC (which consent shall not be unreasonably  withheld,
conditioned or delayed).

          (b) Purchaser  agrees to indemnify  and hold  harmless  Seller and IDC
(and its officers,  employees,  partners,  agents,  affiliates  and  controlling
parties)  from and  against any and all losses,  liabilities,  damages,  claims,
suits, actions, judgments or causes of action, assessments,  costs and expenses,
including without limitation interest,  penalties,  reasonable  attorneys' fees,
any  and  all  reasonable  expenses  incurred  in  investigating,  preparing  or
defending  against  any  litigation,  commenced  or  threatened,  or  any  claim
whatsoever,  and  any  and  all  amounts  paid in  settlement  of any  claim  or
litigation,  asserted  against,  resulting  to,  imposed  upon,  or  incurred or
suffered by Seller or IDC as a result of third party claims resulting or arising
from any inaccuracy or any alleged  inaccuracy in or breach or nonfulfillment of
any of the  representations,  warranties,  covenants or  agreements  made by the
Purchaser in this Agreement,  provided,  however,  that the indemnity  agreement
contained in this  Subsection 4(b) shall not apply to amounts paid in settlement
                   ---------------
of any such loss,  claim,  damage,  liability,  or action if such  settlement is
effected  without  the  consent of the  Purchaser  (which  consent  shall not be
unreasonably withheld, conditioned or delayed).

Section 5.   Brokers and Finders.
             --------------------

     No party hereto shall be obligated to pay any commission,  brokerage fee or
finder's fee based on any alleged  agreement or  understanding  between any such
party and a third  person in respect of the  transactions  contemplated  hereby.
Each party hereto  hereby agrees to indemnify the other against any claim by any
third person for any commission, brokerage or finder's fee or other payment with
respect to this Agreement or the transactions  contemplated  hereby based on any
alleged  agreement or  understanding  between such party and such third  person,
whether express or implied from the actions of such party.

Section 6.   Recitals Incorporated.
             ---------------------
     The recitals of this  Agreement are  incorporated  herein by this reference
and made a material part of this Agreement.  IDC and Seller severally  covenant,
as such  recitals  relate to them,  that the  recitals  are a true and  complete
description of the events leading to the sale of the Note hereunder.

Section 7.   Successors and Assigns.
             ----------------------

     This  Agreement  shall bind and inure to the benefit of the parties  hereto
and their respective successors and assigns.

                                       5

<PAGE>


Section 8.   Entire Agreement.
             ----------------

     This  Agreement,  including  any and all  exhibits  and  schedules  hereto,
contains  the entire  understanding  of the parties  with respect to the subject
matter hereof and supersedes all prior agreements and  understandings  among the
parties with respect thereto.

Section 9.   Notices.
             -------

     All notices,  demands and requests of any kind to be delivered to any party
in  connection  with this  Agreement  shall be in writing and shall be deemed to
have   been   duly   given   if    personally    delivered   or   if   sent   by
internationally-recognized overnight courier or by registered or certified mail,
return receipt requested and postage prepaid, addressed as follows:

          (a) if to Purchaser, to:

                         Sigma Opportunity Fund, LLC
                         c/o Sigma Capital Advisors, LLC
                         800 Third Avenue
                         Suite 1701
                         New York, New York 10022
                         Telecopier: (212) 937-3558
                         Attention: Thom Waye

                         with a copy to:

                         Moomjian & Waite, LLP
                         100 Jericho Quadrangle
                         Suite 225
                         Jericho, NY 11753
                         Telecopier: (516) 937-5050
                         Attention: Kevin W. Waite, Esq.

          (b) if to Seller, to:

                         Integrated Technologies & Systems Ltd.
                         The London Representatives Offices
                         Sungold Administration, Suite 4, 1st Floor,
                         4 Morie Street
                         London. SE18 1SL. United Kingdom
                         Telecopier:  44 20 8875 1856
                         Attention : John Faraday

                         with a copy to:

                         Anslow & Jaclin, LLP
                         195 Route 9 South, Suite 204


                                       6

<PAGE>


                         Manapalan, NJ 07726
                         Telecopier:  (732) 577-1188
                         Attention:  Gregg Jaclin, Esq.

          (c) If to IDC, to:

                         Integrated Data Corp.
                         220 Commerce Drive, Suite 300
                         Fort Washington, PA  19034-2411
                         Telecopier:  484-212-4141
                         Attention:  David C. Bryan

or to such  other  address  as the party to whom  notice is to be given may have
furnished to the other parties to this  Agreement in writing in accordance  with
the provisions of this Section. Any such notice or communication shall be deemed
to have been received (i) in the case of personal delivery,  on the date of such
delivery,  (ii) in the case of  nationally-recognized  overnight courier, on the
next business day after the date when sent and (iii) in the case of mailing,  on
the third business day following that on which the piece of mail containing such
communication is posted.

Section 10.  Amendments.
             ----------

     This Agreement may not be modified or amended,  or any of the provisions of
this Agreement waived, except by written agreement of all parties hereto.

Section 11.  Governing  Law; Waiver of Jury Trial.
             ------------------------------------

               (a) All questions concerning the construction, interpretation and
validity of this  Agreement  shall be governed by and  construed and enforced in
accordance with the domestic laws of the State of New York without giving effect
to any choice or conflict of law  provision or rule (whether in the State of New
York or any other  jurisdiction) that would cause the application of the laws of
any  jurisdiction  other  than the  State of New  York.  In  furtherance  of the
foregoing,  the  internal  law of  the  State  of  New  York  will  control  the
interpretation   and  construction  of  this  Agreement,   even  if  under  such
jurisdiction's choice of law or conflict of law analysis, the substantive law of
some other jurisdiction would ordinarily or necessarily apply.

               (b) BECAUSE DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL
TRANSACTIONS  ARE MOST QUICKLY AND  ECONOMICALLY  RESOLVED BY AN EXPERIENCED AND
EXPERT  PERSON  AND THE  PARTIES  WISH  APPLICABLE  LAWS TO APPLY  (RATHER  THAN
ARBITRATION  RULES),  THE PARTIES  DESIRE  THAT THEIR  DISPUTES BE RESOLVED BY A
JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE,  TO ACHIEVE THE BEST COMBINATION
OF THE BENEFITS OF THE JUDICIAL  SYSTEM AND OF  ARBITRATION,  THE PARTIES HERETO
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,  SUIT OR  PROCEEDING  BROUGHT TO
ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES  UNDER THIS  AGREEMENT OR ANY DOCUMENTS
RELATED HERETO.

                                       7

<PAGE>

Section 12.  Submission to Jurisdiction.
             --------------------------

     Any legal  action or  proceeding  with  respect  to this  Agreement  may be
brought in the courts of the State of New York and the United  States of America
located in the City of New York, New York and, by execution and delivery of this
Agreement,  the parties  hereby  accept for  themselves  and in respect of their
properties,  generally and  unconditionally,  the  jurisdiction of the aforesaid
courts. The parties hereby irrevocably waive, in connection with any such action
or proceeding,  any objection,  including,  without limitation, any objection to
the venue or based on the grounds of forum non conveniens, which they may now or
hereafter  have  to the  bringing  of any  such  action  or  proceeding  in such
respective jurisdictions.  The parties hereby irrevocably consent to the service
of process of any of the aforementioned  courts in any such action or proceeding
by the  mailing of copies  thereof by  registered  or  certified  mail,  postage
prepaid, to them at the address set forth herein.

Section 13.  Severability.
             ------------

     It is the desire  and intent of the  parties  that the  provisions  of this
Agreement be enforced to the fullest extent permissible under the law and public
policies  applied  in  each   jurisdiction  in  which   enforcement  is  sought.
Accordingly,  in the event that any provision of this Agreement would be held in
any jurisdiction to be invalid, prohibited or unenforceable for any reason, such
provision, as to such jurisdiction,  shall be ineffective,  without invalidating
the  remaining  provisions  of this  Agreement  or  affecting  the  validity  or
enforceability  of  such  provision  in any  jurisdiction.  Notwithstanding  the
foregoing,  if such  provision  could  be more  narrowly  drawn  so as not to be
invalid, prohibited or unenforceable in such jurisdiction,  it shall, as to such
jurisdiction,   be  so  narrowly  drawn,   without  invalidating  the  remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.

Section 14.  Counterparts.
             ------------

     This Agreement may be executed in any number of counterparts, and each such
counterpart of this Agreement shall be deemed to be an original instrument,  but
all such  counterparts  together shall  constitute but one agreement.  Facsimile
counterpart signatures to this Agreement shall be acceptable and binding.

Section 15.  Headings.
             --------

     The section and  paragraph  headings  contained in this  Agreement  are for
reference  purposes  only  and  shall  not  affect  in any  way the  meaning  or
interpretation of this Agreement.

Section 16.  Expenses.
             --------

     Each party hereto shall pay its own expenses  incurred in the  preparation,
negotiation  and  execution  of  this  Agreement  and  the  consummation  of the
transactions  contemplated  hereby and  thereby,  including  without  limitation
expenses for legal and accounting  services;  provided,  however,  Seller hereby
                                              --------   -------
agrees to reimburse Purchaser in the amount of $75,000 for its expenses

                                       8
<PAGE>


incurred  in  connection  with the  purchase  of the Note.  Such  amount  may be
withheld from the Contingent Purchase Price.

Section 17.  Survival.
             --------

     The warranties, representations, and covenants of Seller, IDC and Purchaser
contained in or made pursuant to this Agreement  shall survive the execution and
delivery  of this  Agreement  and the Closing and shall in no way be affected by
any  investigation  of the  subject  matter  thereof  made  by or on  behalf  of
Purchaser or Seller.

Section 18.  Further Assurances.
             ------------------

     From and after the date of this Agreement, the parties agree to execute and
deliver  any  additional  documents,  instrument  and other  writings  as may be
reasonably  necessary  to effect the transfer of the Note from the Seller to the
Purchaser, including any documents required by the Company's counsel.

Section 19.  Preparation of Agreement.
             ------------------------

     Each  party to this  Agreement  acknowledges  that:  (i) the  party had the
advice of, or  sufficient  opportunity  to obtain the advice of,  legal  counsel
separate and  independent of legal counsel for any other party hereto;  (ii) the
terms of the transactions contemplated by this Agreement are fair and reasonable
to  such  party;  and  (iii)  such  party  has  voluntarily   entered  into  the
transactions  contemplated  by this Agreement  without duress or coercion.  Each
party  further  acknowledges  that such party was not  represented  by the legal
counsel  of  any  other  party  hereto  in  connection  with  the   transactions
contemplated  by this  Agreement,  nor was it under any belief or  understanding
that such legal counsel was representing  its interests.  Each party agrees that
no  conflict,  omission or ambiguity in this  Agreement,  or the  interpretation
thereof,  shall be presumed,  implied or otherwise  construed  against any other
party to this  Agreement  on the basis  that  such  party  was  responsible  for
drafting this Agreement.

                                    * * * * *

                                       9
<PAGE>


     IN WITNESS  WHEREOF,  each of the  undersigned  has duly executed this Note
Purchase Agreement as of the date first written above.


                               INTEGRATED TECHNOLOGIES & SYSTEMS LTD.


                               By:  /s/John Faraday
                                  ------------------------------------
                               Name: John Faraday
                               Title: President & CEO


                               SIGMA OPPORTUNITY FUND, LLC
                               By: Sigma Capital Advisors, LLC, managing member

                               By:/s/Thom Waye
                                  -------------------------------------
                                  Name: Thom Waye
                                  Title: Manager

                               INTEGRATED DATA CORP.


                               By: /s/ David C. Bryan
                                  --------------------------------------
                                  Name: David C. Bryan
                                  Title: President & CEO


                                       10
>