Editor's note: Company officials have clarified the potential for layoffs disclosed in a filing with the state. An earlier version of this story stated the company would cease operations and employment at two local facilities. While those operations may shut down completely, they may also be sold as ongoing operations to another owner.

Everything But The House told Ohio regulators it could lay off much of its local workforce: 230 employees at facilities in Blue Ash and Linwood as the company seeks to sell assets.

The filings made to the state of Ohio come after the online consignment retailer disclosed Wednesday it had sought legal protection of its assets through a legal move similar to bankruptcy called an "assignment for the benefit of creditors."

Under the process, an assignee (similar to a bankruptcy trustee) has assumed control of the company's operations and assets.

While Everything But The House continues to operate as an ongoing business, it will cease to exist as it is currently incorporated, the company told Ohio officals. Once the court proceedings are completed in the next four to six weeks, EBTH will be sold or liquidated.

Specifically, the company will be: sold and continue operating as EBTH; sold and operate under a new name; or cease operations with remaining assets liquidated, the company disclosed to Ohio officials.

Because Everything But The House will no longer be an independent company under its current ownership, it has issued a notice to state officials disclosing 240 of its local employees will no longer work for it by late August.

"The language around termination is technical/legal: It’s important to understand that in an asset sale... all employees are terminated because the original entity (EBTH) no longer exists, and then they are all hired as employees of the new legal entity," said company spokesman John Williams.

The company told Ohio officials it is "aggressively" seeking a buyer, but conceded Everything But The House may not be successful and ultimately liquidate.

EBTH disclosed to Ohio officials it had been seeking further investments in its business for six months. It was unsuccessful getting more money to operate the business despite conversations with more than 100 potential investors.

"Of course, if the company does not find a buyer, then all operations will cease," Williams said.

The layoffs could begin in mid-August and affect 160 workers at its Blue Ash distribution center and 70 workers at its Wilmer Avenue facility in Cincinnati.

Court records say the struggling company, which once had more than 1,000 workers, now only employs 350.

The Over-The-Rhine based dot.com declined to say why, adding the process would take four to six weeks. The company declined to say where it sought legal protection, but the filing was later disclosed to be in a Delaware court (EBTH is incorporated in the state of Delaware).

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Court documents obtained by The Enquirer indicate EBTH defaulted on an operating line of credit, on which it owes $5 million. The secured creditor is demanding payment.

Under the process, an assignee (similar to a bankruptcy trustee) has assumed control of the company's operations and assets.

The assignee has begun the process of "selling substantially all of the assets..." to pay off the creditors, according to court records.

It is unclear if Everything But The House will be sold off for parts or if the business survives and is sold to another company or investors.

Court records say company officials explored several options but ultimately chose court protection.

"(The) board of directors extensively explored, with the aid of seasoned professionals, options to maximize value for constituents," court records said. "For various reasons, none of these options were viable."

The company said Wednesday that it would make "no immediate changes to operations or employment."

But the Ohio Department of Job and Family Services posted the layoff notices later Wednesday.

Local legal experts say an assignment for the benefit of creditors or "ABC" is a less expensive and less cumbersome way than bankruptcy court to protect company assets amid a significant threat to the company – such as a creditor or investor dispute.

Once labeled Ohio's most valuable startup, Everything But The House was founded in 2007 and grew rapidly until a major restructuring and management change in 2018. Executives said earlier this month the money-losing company's fortunes were rebounding.

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