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Geist restaurateur buffeted by financial squalls

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Greg Andrews
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.

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  • WHAT WAS DURHAM THINKING?
    What was Durham thinking when he settled those lawsuits up in Hamilton County? Apparently it did not trickle through his Rolls Royce brain that he was headed to prison for many, many years. Talk about denial.
  • My thoughts
    Henri really is a decent guy, he works his butt off. Shelly is a terrible person though.
    • Poor Treatment is Common at Bella Vita
      It is a shame in these times, when every restaurant owner is doing everything they can to sustain business, that owner, Shelley Najem treats everyone so poorly. She never learned the meaning of customer retention.
      I have heard from employees, that not only are they fearful for their jobs, but are embarassed by the way she treats many of the customers. It is a wonder they have any business left. Be glad you didn't have your event there, it would of been more of the same from her.
    • Bella Vita owners should be more humble
      I had been to Bella Vita a few times and enjoyed the food and atmosphere. I decided to book my reception in the balcony and had visited and spoke with the owner, Shelly, may times on the phone and in person.

      This evening my fiancee and I brought 3 friends to "show off" the place and to drop off our deposit check for the reception. We figured it might be busy, so we made a reservation for 7 pm. We arrived 3-4 minutes before 7 pm and waited for over 1 hr before we were seated! Now I know it is prom season, and the place was busy, but ONE HOUR after the reservation? Regardless, we waited and our hostess was very sympathetic and apologized several times. We told her we understood, that it was not her fault, and that we were just excited to eat!

      We placed our order soon after being seated. The appetizers did not come until 1/2 hour after we placed them. Mind you, there was a total of 1 1/2 hrs from the time of our reservation and the time that we received our APPETIZER. By this time, our guests were starving! Again, we were patient and tried to tell ourselves that the place was just "busy" and perhaps Shelly would offer an apology and maybe some small discount/dessert as a small token to show our guests that the restaurant was busy and not completely inconsiderate and disorganized.

      After dinner, my fiancee approached Shelly, reminded her that he is the groom of the bride who paid the deposit earlier in the evening, and that we had 3 friends come with us tonight to "show off" the place. He told Shelly that we waited 1 1/2 hrs to get our appetizers when we had a reservation and that we were a little bit concerned about making sure that there was not as long as a wait for our wedding reception. My fiancee is a very calm and sweet guy and was just hoping to express his concern with her. In no way did he disrespect her or raise his voice. Shelly then gave an excuse, refused to appologize and handed the check back to my fiancee. She told him that she had another couple who was interested in the date reserved and that she would "just call them to let them know the day was now open." She walked off before my fiancee could say anything else.

      My overall thoughts: How could someone do this to a bride 4 months before the reception date? We brought our friends to show them how great the place was and instead we had an 1 hour wait past our reservation time and EVEN WORSE, the manager showed absolutely no remorse or apology for the poor service. I left the place disappointed, embarassed and in tears.

      Not only was my evening ruined, but now I have to find another venue with only 4 months to go. My opinion- the hostess and some of the servers were great and very humble. The owner could really learn from them.
      • Buddies!!
        Whate do you bet Ole Timmy funneld some money from some Fair to take care of that!!!!

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      1. Cramer agrees...says don't buy it and sell it if you own it! Their "pay to play" cost is this issue. As long as they charge customers, they never will attain the critical mass needed to be a successful on company...Jim Cramer quote.

      2. My responses to some of the comments would include the following: 1. Our offer which included the forgiveness of debt (this is an immediate forgiveness and is not "spread over many years")represents debt that due to a reduction of interest rates in the economy arguably represents consideration together with the cash component of our offer that exceeds the $2.1 million apparently offered by another party. 2. The previous $2.1 million cash offer that was turned down by the CRC would have netted the CRC substantially less than $2.1 million. As a result even in hindsight the CRC was wise in turning down that offer. 3. With regard to "concerned Carmelite's" discussion of the previous financing Pedcor gave up $16.5 million in City debt in addition to the conveyance of the garage (appraised at $13 million)in exchange for the $22.5 million cash and debt obligations. The local media never discussed the $16.5 million in debt that we gave up which would show that we gave $29.5 million in value for the $23.5 million. 4.Pedcor would have been much happier if Brian was still operating his Deli and only made this offer as we believe that we can redevelop the building into something that will be better for the City and City Center where both Pedcor the citizens of Carmel have a large investment. Bruce Cordingley, President, Pedcor

      3. I've been looking for news on Corner Bakery, too, but there doesn't seem to be any info out there. I prefer them over Panera and Paradise so can't wait to see where they'll be!

      4. WGN actually is two channels: 1. WGN Chicago, seen only in Chicago (and parts of Canada) - this station is one of the flagship CW affiliates. 2. WGN America - a nationwide cable channel that doesn't carry any CW programming, and doesn't have local affiliates. (In addition, as WGN is owned by Tribune, just like WTTV, WTTK, and WXIN, I can't imagine they would do anything to help WISH.) In Indianapolis, CW programming is already seen on WTTV 4 and WTTK 29, and when CBS takes over those stations' main channels, the CW will move to a sub channel, such as 4.2 or 4.3 and 29.2 or 29.3. TBS is only a cable channel these days and does not affiliate with local stations. WISH could move the MyNetwork affiliation from WNDY 23 to WISH 8, but I am beginning to think they may prefer to put together their own lineup of syndicated programming instead. While much of it would be "reruns" from broadcast or cable, that's pretty much what the MyNetwork does these days anyway. So since WISH has the choice, they may want to customize their lineup by choosing programs that they feel will garner better ratings in this market.

      5. The Pedcor debt is from the CRC paying ~$23M for the Pedcor's parking garage at City Center that is apprased at $13M. Why did we pay over the top money for a private businesses parking? What did we get out of it? Pedcor got free parking for their apartment and business tenants. Pedcor now gets another building for free that taxpayers have ~$3M tied up in. This is NOT a win win for taxpayers. It is just a win for Pedcor who contributes heavily to the Friends of Jim Brainard. The campaign reports are on the Hamilton County website. http://www2.hamiltoncounty.in.gov/publicdocs/Campaign%20Finance%20Images/defaultfiles.asp?ARG1=Campaign Finance Images&ARG2=/Brainard, Jim

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