The Bella Vita restaurant overlooking Geist Marina serves up one of the most serene settings in central Indiana. Owner Henri Najem and his wife, Shelley, work hard behind the scenes to provide diners with upscale Italian food in a relaxed atmosphere.

Their own lives are anything but relaxed these days, as the severe economic slump strains finances. It's the same pressure scores of Indiana restaurant operators are feeling. The Najems have responded by cutting costs and being hands-on. "We work our butts off now," Henri Najem, 46, said.

Yet his bankers are nervous. In January, Muncie-based First Merchants Bank sued, saying the Najems had defaulted on a nearly $230,000 loan that was supposed to be paid off last November. The suit seeks to foreclose on the restaurant real estate, which serves as collateral.

"What had happened is, the note came up for renewal. They really wanted me to pay it off, but I didn't have the money to pay it off," Najem said.

"I think banks have become more conservative in their lending," he added. "They look at their risk profile, and they don't like the catering business or the restaurant business."

The good news for Najem is it looks like the bank will settle. He said he is finalizing a deal under which he will pay down some of the principal in return for extending the terms.

Phil Fowler, an attorney representing First Merchants, confirmed the parties are discussing a settlement, but he said there's no deal yet.

Najem said the loan stems from his catering operations, one piece of his restaurant holdings. He's in the process of selling a restaurant he owns in Kentucky. He continues to own a moderately priced Bella Vita restaurant in New Castle he opened last year in a partnership with Indianapolis businessman Tim Durham.

These days, Najem, said, "it's back to the basics." He said he spends a lot of time in the Geist restaurant's kitchen, and his wife is a fixture to customers in the front of the restaurant.

It's not the trajectory Najem appeared to be on early this decade, when he hit the jackpot on an investment in Brightpoint Inc., the wireless phone wholesaler.

He and Durham were part of a group that bet big on the stock when the company appeared on the verge of financial collapse. When it sprang back, Durham made about $30 million. Najem, who cashed in earlier in the stock's run, figures he made $1.2 million — money he tapped five years ago to renovate and upgrade the former Blue Heron to create the Geist restaurant.

Money's tighter now. Last October, Najem found himself in the Henry County Jail in New Castle on felony check deception charges stemming from a gambling foray in Las Vegas. Investigators say he had insufficient funds in his checking account to cover nearly $45,000 in "casino markers," a form of gambling credit.

The debt was quickly paid and the charges dropped, said Bernie Zadrowski, chief deputy district attorney in the Bad Checks Unit in Clark County, Nev.

Najem, who had been in Las Vegas for a convention, called the episode humiliating.

"They kept extending the line of credit on me, which was a big mistake on my part," he said.

Durham settles lawsuits

Durham has settled five lawsuits filed in January that alleged he defaulted on more than $208,000 in promissory notes.

Under settlements recently filed in Hamilton Superior Court, Durham, 46, agreed to make good on everything he owes, plus interest and attorneys' fees, but with payments stretched out through June.

All the plaintiffs were investors who were severing ties with Obsidian Enterprises, Durham's leveraged-buyout firm. Court records show Durham signed the notes in June 2008 and made the first required payment in September, but defaulted on the December payment.

Plaintiffs included Robert Kasper, managing principal of the wealth-management firm Windsor Group; Larry Greenwalt and Tom Sponsel, principals of the CPA firm Greenwalt Sponsel & Co.; Michael K. Miles of Miles Capital Advisors; Brian Williams of the venture capital firm Hopewell Ventures; and Williams' father, Jerry Williams, who is of counsel to the law firm Taft Stettinius & Hollister.