Crossroads Systems has sold its core product to a Canadian company and is looking for a buyer for a patent portfolio.
Austin-based Crossroads said StrongBox Data Solutions will pay $1.85 million in cash for its entire product business and related assets. The agreement includes the company's entire product portfolio and maintenance business, including its StrongBox and Sphinx storage solutions.
As part of the agreement, 27 Crossroads employees will transition to StrongBox Data Solutions.
Crossroads said it also signed an agreement with Aqua Licensing to market and sell a patent portfolio that consists of 138 patents and pending patents.
"We believe the sale of our product business is clearly in shareholders' best interests as it significantly reduces our cash burn," Richard Coleman, CEO of Crossroads, said in a statement. "Going forward we will focus our efforts and resources on vigorously defending our intellectual property and identifying additional IP monetization opportunities."
Crossroads was founded in 1996 as a developer of software to connect and protect data enterprise storage and cloud computing.
Today it is an intellectual property licensing company that has licensed patents to more than 50 companies since 2000.
The company has struggled financially over the past few years, and its share price has fallen more than 75 percent this year.
Shares were trading at 24 cents a share at midday on Wednesday.