Yet another Nashville-based restaurant enterprise is facing financial difficulties.

General Electric Capital Corp. filed suit yesterday in Nashville's federal court against Vivid Restaurant Concepts LLC, which operates seven upscale casual restaurants in three states, including Amerigo locations on West End Avenue and in Brentwood.

The financing firm claims Vivid is in default on $8.5 million in loans issued in the past two years to finance a management buyout and brand expansion. GE says the borrower failed to make its monthly payment for November and did not respond to a demand letter seeking $154,000 in payment to cover the delinquency.

The lawsuit, asks the court to appoint a receiver who would "preserve and protect" the restaurants until they can be sold off. It names Kevin T. O'Halloran, a turnaround expert with Newbridge Management LLC in Atlanta, as its candidate to serve as receiver.

GE says Amerigo's parent "has recently indicated its revenues are decreasing" and that it cannot make its scheduled monthly payments as required under the terms of the loan. The lender argues that the amount Vivid owes is greater than the value of the restaurants it has pledged as collateral.

"Indeed, if Vivid's business operations cease and any of the properties 'go dark,' GECC will not receive the profits and revenue from the collateral, and the collateral will lose significant value which cannot be recaptured," the complaint states.

Todd Napier, a spokesman for Vivid, told that none of its restaurants are in imminent danger of closure. "What's taking place doesn't affect the daily operation of any of the restaurants," Napier said. "The company is working to restructure the terms of the loan, and both parties have agreed for an outside, non-related party to help set up new terms."

Asked whether O'Halloran is the outside party in question, Napier said he did not know. The person being brought in, he said, "will be involved in the operations, but will not be taking over the operations."

Charlie Cook of Adams & Reese LLP is representing GE Capital, along with three attorneys from the Denver office of national law firm Kutak Rock LLP.

The flagship Amerigo Italian bistro at 20th Avenue and West End opened in 1987. Longtime Nashville restaurateurs David Blackburn and Paul Schramkowski formed Vivid in late 2006 to purchase the chain, with backing from New York investment firm Northwood Ventures. The new owners opened Amerigo units in Knoxville and Louisville in 2007.

Vivid's troubles follow a rash of bad news at local restaurant companies across the dining spectrum in the past couple of months:

• A vendor sued fast-food chain Back Yard Burgers Inc. in November, claiming the company owed it $1.1 million and asserting that BYB was in financial trouble.
• A group of lenders sued Taco Bell franchisee American Hospitality Corp. in November over its alleged default on loans totaling $14.4 million. American Hospitality has since filed to reorganize under Chapter 11 of the bankruptcy code. In a filing last week, one of the lenders argued that "an effective reorganization is not possible" and that it should be allowed to seize the collateral to its loans – 24 of the company's 77 restaurants.
• The Tangredi family's Nashville restaurants have been involved in several legal actions, including a claim by American Express that family members took part in a $1.1 million fraud conspiracy.
• Under pressure from an activist investment firm as his company's stock slumped, O'Charley's Chairman and CEO Greg Burns last week announced his retirement.
• Amid a sales decline, the CEO of Cracker Barrel operator CBRL Group told investors: “We don’t see a lot of catalysts out there for industry improvement” in 2009.