Note 1. Organization and Description of Business

SoundThinking, Inc. (the “Company”) brings the power of digital transformation to law enforcement and security personnel by providing precision-policing and security solutions, combining data-driven solutions and strategic advisory services for law enforcement, security teams and civic leadership. As of September 30, 2026, the Company had approximately 313 customers and to date has worked with approximately 2,100 agencies to help drive more efficient, effective, and equitable public safety outcomes.

The Company’s SafetySmart™ platform includes seven data-driven tools consisting of (i) its flagship product, ShotSpotter®, the leading outdoor gunshot detection, location and alerting system trusted by 170 cities and 21 universities and corporations as of September 30, 2026, (ii) CrimeTracer™, an agency-wide crime data and intelligence platform that enables investigators, analysts, patrol officers and command staff to search through more than one billion criminal justice records from across jurisdictions, leverage dashboards and artificial intelligence (“AI”)-assisted tools to generate tactical leads and quickly make intelligent connections to solve crimes, (iii) CaseBuilder™, a one-stop investigative management system for tracking, reporting, and collaborating on cases, (iv) ResourceRouter™ that directs the deployment of patrol and community anti-violence resources in an objective way to help maximize the impact of limited resources and improve community safety, (v) PlateRanger™ powered by Rekor®, an advanced license plate recognition (“ALPR”) and vehicle identification solution that leverages AI and machine learning to enhance investigative efficiency and provide real-time data sharing for law enforcement, (vi) Field Agent, an AI layer that transforms public safety data into actionable intelligence, and (vii) SafePointe™, an AI-based weapons detection system designed to provide discreet, high throughput screening that complements physical security measures without compromising visitor experience. The Company offers its solutions on a software-as-a-service subscription model to its customers. These solutions may operate independently or together as an integrated platform that connects detection, data analysis, resource deployment and case management workflows.

ShotSpotter for Campus and ShotSpotter for Corporate, are typically smaller-scale deployments of ShotSpotter vertically marketed to universities, corporate campuses, and key infrastructure centers to mitigate risk and enhance security by notifying authorities of outdoor gunfire incidents, saving critical minutes for first responders to arrive. In 2019, the Company created a technology innovation unit, SoundThinking Labs, to expand its efforts supporting innovative uses of its technology to help protect wildlife and the environment. In the first quarter of 2025, the Company rolled out a perimeter-based sniper gunshot detection solution targeting utility substations, with initial pilots aimed at utility customers, conducted through SoundThinking Labs. Additionally, the Company provides maintenance and support services and professional software development services to two customers, through sales channel intermediaries.

The Company’s principal executive offices are located in Fremont, California. The Company has six wholly owned subsidiaries.

Pending Merger Transaction

On September 28, 2026, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Transom Signal AcquireCo, LLC, a Delaware limited liability company (“Parent”), and Transom Signal MergerSub, Inc., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”). Parent and Merger Sub are affiliates of Transom Capital Group, LLC. Pursuant to the Merger Agreement, Merger Sub commenced a tender offer (the “Offer”) to purchase any and all outstanding shares of the Company's common stock for consideration of $8.00 per share in cash, without interest, plus one non-transferable contingent value right (“CVR”) per share, which represents the contractual right of the holder to receive a contingent cash payment of up to $3.00 per CVR, without interest and less any applicable tax withholding, upon the achievement of certain specified revenue milestones.

The CVR represents a non-transferable contractual contingent right to receive a cash payment of up to $3.00 per CVR, without interest and less any applicable tax withholding, upon the achievement of certain specified revenue milestones for the Company’s fiscal year commencing January 1, 2027 and ending December 31, 2027 and, for certain other specified, limited revenues, a period of 120 days thereafter (the “Milestone Period”), as follows:

The Company's Board of Directors unanimously approved the transaction and recommended that stockholders tender their shares in the offer. Following the completion of the Offer and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, Parent, Merger Sub and the Company will, pursuant to Section 251(h) of the General Corporation Law of the State of Delaware, as amended (“DGCL”), without a vote of the Company stockholders, effect a merger of Merger Sub with and into the Company (the “Merger” and together with the Offer and the other transactions contemplated by the Merger Agreement, the “Transactions”), with the Company surviving as a wholly owned subsidiary of Parent, and the Company will cease to be a publicly traded company.

The Merger Agreement contains customary representations, warranties, covenants, non-solicitation provisions, and termination rights. Under certain circumstances, including termination to enter into a superior proposal, the Company may be required to pay a termination fee of $4.5 million.

During the three and nine months ended September 30, 2026, the Company recognized $5.1 million and $7.1 million of acquisition-related expenses, respectively, which were included in general and administrative operating expenses on the Company's unaudited condensed consolidated statements of operations.