NEW JERSEY TAX:

Express Systems & Peripherals is a New Jersey Domestic For-Profit Corporation registered by the State of New Jersey Department of the Treasury on July 21, 1995.

Express Systems & Peripherals holds a valid Reseller's Permit: #223-394-414/000

Buyers located in New Jersey are subject to NJ State Sales Tax.

Orders shipping to New Jersey are also subject to NJ State Sales Tax.

If you are Tax Exempt, please E-mail or Fax (732-928-6208) us your Tax Exempt Certificate and we will credit your Invoice. If you have any questions please call (800) 222-0172 with any questions.

CALIFORNIA TAX:

Express Systems & Peripherals is a California Foreign For-Profit Corporation registered by the California State Board of Equalization (BOE) and is authorized to collect State and Local Use Taxes.

Express Systems & Peripherals holds a valid California Reseller's Permit: #SC OHB 103-224496

Buyers located in California are subject to California State Sales Tax.

Orders shipping to California are also subject to California State Sales Tax.

If you are Tax Exempt, please E-mail or Fax (732-928-6208) us your Tax Exempt Certificate and we will credit your Invoice. If you have any questions please call (800) 222-0172 with any questions.

PENNSYLVANIA NOTICE AND REPORT LAW:
This law went into effect February 1, 2018.

***UPDATE - For 2019 - Express Systems & Peripherals has chosen Option 1: Sales Tax Registration.***

January 2019, E.S.P. Inc. registered for a seller's permit in Pennsylvania.

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What does this mean?

Express Systems & Peripherals holds a valid Reseller's Permit: #67637257

Buyers located in Pennsylvania are subject to PA State Sales Tax.

Orders shipping to Pennsylvania are also subject to PA State Sales Tax.

If you are Tax Exempt, please E-mail or Fax (732-928-6208) us your Tax Exempt Certificate and we will credit your Invoice. If you have any questions please call (800) 222-0172 with any questions.

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***FOR 2018 - Express Systems & Peripherals has elected for Option 2: Notice & Reporting Requirements.***

Beginning March 1, 2018 - customers of Express Systems will be notified of their Tax Requirements in accordance with Pennsylvania Notice and Report Law.

A summary of the law and its requirements is below:

Remote Sellers A remote seller is a seller that does not maintain a place of business in Pennsylvania and makes sales directly to
individual and business customers in Pennsylvania.

Mandatory Election
A remote seller that makes taxable sales totaling $10,000 or more to Pennsylvania customers in the previous calendar year must
elect one of two options by March 1, 2018:

Option 1 - Register to collect and remit Pennsylvania sales tax.
Option 2 - Comply with Pennsylvania’s notice and reporting requirements.

An election made on or before March 1, 2018 will be in effect through June 30, 2019.
The remote seller must complete REV-1830 (Annual Marketplace Sales Election Form) to make the election.

An election to comply with the notice and reporting requirement may be changed at any time to an election to collect and remit
sales tax.

Failure to file an election will be treated by the Department of Revenue as an election to comply with the notice and reporting
requirements.

Option 1 - Sales Tax Registration

If a remote seller elects to collect and remit sales tax, then it is required to register for a sales tax license.
A sales tax license can be obtained at this web address:

https://www.pa100.state.pa.us/Registration.htm.

Collections are to begin April 1, 2018 for the current election cycle.

Option 2 - Notice and Reporting Requirements

If a remote seller elects to comply with the notice and reporting requirements, it must take the following actions starting
April 1, 2018:

1. Post a notice on the sales forum that states:

Pennsylvania sales or use tax may be due in connection with the purchase and delivery of tangible personal property to
Pennsylvania individuals and businesses.

The purchaser is required to file a use tax return if tax is due in connection with the purchase and delivery in the
Commonwealth.

This notice is required pursuant to the provisions of the Tax Reform Code of 1971. 72 P.S. § 7213.2.

2. Provide a written notice on all invoices, order forms, sales receipts or similar documents, whether in
paper or electronic form, to each purchaser at the time of each sale that states:

Pennsylvania sales tax was not collected on this sale. Therefore, you may be required to remit use tax directly to the
Commonwealth on your purchase if the items are subject to Pennsylvania sales tax. Please visit this link to learn
more about your use tax obligations under Pennsylvania law.

No statement that sales or use tax is not imposed on a transaction may be made by a remote seller, unless the
transaction is exempt from sales and use tax, pursuant to Article II of the Tax Reform Code or other applicable Commonwealth law.

3. Provide an annual report to the purchaser that states:

A remote seller making an election to comply with the notice and reporting requirements must submit an annual report
by January 31 of each year to the purchaser that includes the following.

Express Systems & Peripherals did not collect sales tax in connection with your transactions. You may be required
to remit use tax to the Pennsylvania Department of Revenue. Following is a list by date, type and purchase price
of each product, purchased or leased by the purchaser from this remoter seller, and delivered to a location within this Commonwealth.

[Insert list]

Please visit this link to learn more about your use tax obligations under Pennsylvania law.

[Name of remote seller] is required to submit an annual report to the Department of Revenue that includes the
name of the purchaser and total dollar amount of the purchases from this remote seller.

This report shall be mailed by first class mail, in an envelope prominently marked with words indicating that important tax
information is enclosed, to the purchaser’s billing address, if known, or if unknown, to the purchaser’s shipping address.
If the purchaser’s billing and shipping address are unknown, the report shall be sent electronically to the purchaser’s last
known email address with a subject heading indicating that important tax information is being provided.

4. Provide an annual report to the Pennsylvania Department of Revenue A remote seller making an election
to comply with the notice and reporting requirements must submit an annual report by January 31 of each year to the
Department of Revenue that includes the following:

• The purchaser’s name, billing address, delivery address and, if different, the purchaser’s last known mailing address.

• The total dollar amount of purchases from this remote seller.

Instructions for filing these reports with the department are provided under Technical Information.

A report required under this section shall be submitted by an officer of the remote seller and shall include a statement made under
penalty of perjury by the officer that the remote seller made reasonable efforts to comply with the notice and reporting requirements
of this part.

Each failure to comply with the notice and reporting requirements can result in a penalty of $20,000 per violation, per year, or 20
percent of total Pennsylvania sales during the previous 12 months, whichever is less.

https://www.pa100.state.pa.us/Registration.htm.

https://www.revenue.pa.gov/GeneralTaxInformation/Tax%20Types%20and%20Information/SUT/MarketPlaceSales
/Pages/Remote-Sellers.aspx

NEW YORK TAX:

Express Systems & Peripherals is a New Jersey Domestic For-Profit Corporation registered by the State of New Jersey Department of the Treasury on July 21, 1995.

As of January 2019, Express Systems & Peripherals holds a valid New York Registration#: PENDING

Buyers located in New York are subject to NY State Sales Tax.

Orders shipping to New York are also subject to NY State Sales Tax.

If you are Tax Exempt, please E-mail or Fax (732-928-6208) us your Tax Exempt Certificate and we will credit your Invoice. If you have any questions please call (800) 222-0172 with any questions.

Due to the recent Supreme Court Ruling: SOUTH DAKOTA v. WAYFAIR,
INC., ET AL. all online orders, regardless of the bill to or the ship to may be subject to State and Local Sales Tax.

***Please note that this is a very recent development and Express Systems & Peripherals is working diligently to ensure our compliance with the emerging tax laws spawning from this Supreme Court Ruling.

Please ensure that all orders, regardless of the bill to or ship to are accompanied by valid tax certificates. If your company does not have a valid resellers permit or valid tax exemption, your order may be charged Sales Tax.***

Explanation:

Economic Nexus is the new term when determining whether or not online sales are subject to state and local taxes.

Now, not only does physical presence (such as a location, employee or inventory), but “economic” presence in a state creates sales tax nexus.

Due to the Wayfair ruling, even if you do not have a physical presence in a state, if you pass a state’s economic threshold for total revenue or number of transactions in that state, you’re legally obligated to collect and remit sales tax to that state. State laws on economic nexus vary.

A summary of the Supreme Court Case is below:

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SOUTH DAKOTA v. WAYFAIR, INC., ET AL.
Should this Court abrogate Quill's sales-tax-only, physical-presence requirement?
Majority Opinion: Justice Kennedy

In two earlier cases the Court held that an out-of-state seller’s liability to collect and remit the tax to the consumer’s State depended on whether
the seller had a physical presence in that State, but that mere shipment of goods into the consumer’s State, following an order from a catalog,
did not satisfy the physical presence requirement. National Bellas Hess, Inc. v. Department of Revenue of Ill., 386 U. S. 753 (1967);
Quill Corp. v. North Dakota, 504 U. S. 298 (1992).

The central dispute is whether South Dakota may require remote sellers to collect and remit the tax without some additional connection to the State. (p.10)

Quill puts both local businesses and many interstate businesses with physical presence at a competitive disadvantage relative to remote sellers.
Remote sellers can avoid the regulatory burdens of tax collection and can offer de facto lower prices caused by the widespread
failure of consumers to pay the tax on their own. (p.12-13)

Rejecting the physical presence rule is necessary to ensure that artificial competitive advantages are not created by this Court’s precedents.
This Court should not prevent States from collecting lawful taxes through a physical presence rule that can be satisfied only if there is an
employee or a building in the State. (p. 13)

Modern e-commerce does not align analytically with a test that relies on the sort of physical presence defined in Quill. (p. 14)

This Court should not maintain a rule that ignores these substantial virtual connections to the State. (p. 15).

The physical presence rule it defines has limited States’ ability to seek long-term prosperity and has prevented market participants
from competing on an even playing field. (p. 17)

Decision: For these reasons, the Court concludes that the physical presence rule of Quill is unsound and incorrect.
The Court’s decisions in Quill Corp. v. North Dakota, 504 U. S. 298 (1992), and National Bellas Hess, Inc. v. Department of Revenue of Ill., 386 U. S. 753 (1967), should be, and now are, overruled. (p. 22)

The judgment of the Supreme Court of South Dakota is vacated, and the case is remanded for further proceedings not inconsistent
with this opinion. (p. 23-24)

Reference:
The Supreme Court of the United States (October 2017). SOUTH DAKOTA v. WAYFAIR, INC., ET AL. No. 17–494.
Argued April 17, 2018—Decided June 21, 2018. Retrieved from:
https://www.supremecourt.gov/opinions/17pdf/17-49...

The following states have enacted Notice and Report Laws; and as a result, any orders with economic nexus in these states (bill to or ship to), and/or physical nexus in these states may be subject to State and Local Sales tax or state reporting laws:

• Alabama - Alabama Senate Bill 86 “notice and report” law went into effect July 1, 2017.

• Colorado - This law went into effect July 1, 2017.

• Kentucky - This law went into effect July 1, 2013.

• Louisiana - This law went into effect July 1, 2017.

• Oklahoma - This law went into effect in April 2018.

• Pennsylvania - This law went into effect February 1, 2018. ***E.S.P. Inc. is registered as a PA Seller and is authorized to collect Sales and Use Tax for PA orders (Bill To and/or Ship To)***

• Rhode Island - This law went into effect August 17, 2017.

• South Dakota - This law originally went into effect July 1, 2011. Supreme Court Case SOUTH DAKOTA v. WAYFAIR, INC., ET AL. held that this law was permissible.

• Tennessee - This law went into effect March 26, 2012.

• Vermont - This law went into effect July 1, 2017.

• Washington - This law went into effect January 1, 2018.