diff --git a/src/basic_memory/cli/app.py b/src/basic_memory/cli/app.py
index ea749735..d6e74f9a 100644
--- a/src/basic_memory/cli/app.py
+++ b/src/basic_memory/cli/app.py
@@ -63,11 +63,12 @@ def app_callback(
     # Run initialization for commands that don't use the API
     # Skip for 'mcp' command - it has its own lifespan that handles initialization
     # Skip for API-using commands (status, sync, etc.) - they handle initialization via deps.py
-    api_commands = {"mcp", "status", "sync", "project", "tool"}
+    # Skip for 'reset' command - it manages its own database lifecycle
+    skip_init_commands = {"mcp", "status", "sync", "project", "tool", "reset"}
     if (
         not version
         and ctx.invoked_subcommand is not None
-        and ctx.invoked_subcommand not in api_commands
+        and ctx.invoked_subcommand not in skip_init_commands
     ):
         from basic_memory.services.initialization import ensure_initialization
 
diff --git a/src/basic_memory/cli/commands/command_utils.py b/src/basic_memory/cli/commands/command_utils.py
index 5f34cf8f..286c0430 100644
--- a/src/basic_memory/cli/commands/command_utils.py
+++ b/src/basic_memory/cli/commands/command_utils.py
@@ -42,23 +42,45 @@ async def _with_cleanup() -> T:
     return asyncio.run(_with_cleanup())
 
 
-async def run_sync(project: Optional[str] = None, force_full: bool = False):
+async def run_sync(
+    project: Optional[str] = None,
+    force_full: bool = False,
+    run_in_background: bool = True,
+):
     """Run sync operation via API endpoint.
 
     Args:
         project: Optional project name
         force_full: If True, force a full scan bypassing watermark optimization
+        run_in_background: If True, return immediately; if False, wait for completion
     """
 
     try:
         async with get_client() as client:
             project_item = await get_active_project(client, project, None)
             url = f"{project_item.project_url}/project/sync"
+            params = []
             if force_full:
-                url += "?force_full=true"
+                params.append("force_full=true")
+            if not run_in_background:
+                params.append("run_in_background=false")
+            if params:
+                url += "?" + "&".join(params)
             response = await call_post(client, url)
             data = response.json()
-            console.print(f"[green]{data['message']}[/green]")
+            # Background mode returns {"message": "..."}, foreground returns SyncReportResponse
+            if "message" in data:
+                console.print(f"[green]{data['message']}[/green]")
+            else:
+                # Foreground mode - show summary of sync results
+                total = data.get("total", 0)
+                new_count = len(data.get("new", []))
+                modified_count = len(data.get("modified", []))
+                deleted_count = len(data.get("deleted", []))
+                console.print(
+                    f"[green]Synced {total} files[/green] "
+                    f"(new: {new_count}, modified: {modified_count}, deleted: {deleted_count})"
+                )
     except (ToolError, ValueError) as e:
         console.print(f"[red]Sync failed: {e}[/red]")
         raise typer.Exit(1)
diff --git a/src/basic_memory/cli/commands/db.py b/src/basic_memory/cli/commands/db.py
index 93a421cd..a878252c 100644
--- a/src/basic_memory/cli/commands/db.py
+++ b/src/basic_memory/cli/commands/db.py
@@ -1,13 +1,50 @@
 """Database management commands."""
 
 import asyncio
+from pathlib import Path
 
 import typer
 from loguru import logger
+from rich.console import Console
+from sqlalchemy.exc import OperationalError
 
 from basic_memory import db
 from basic_memory.cli.app import app
-from basic_memory.config import ConfigManager, BasicMemoryConfig, save_basic_memory_config
+from basic_memory.config import ConfigManager
+from basic_memory.repository import ProjectRepository
+from basic_memory.services.initialization import reconcile_projects_with_config
+from basic_memory.sync.sync_service import get_sync_service
+
+console = Console()
+
+
+async def _reindex_projects(app_config):
+    """Reindex all projects in a single async context.
+
+    This ensures all database operations use the same event loop,
+    and proper cleanup happens when the function completes.
+    """
+    try:
+        await reconcile_projects_with_config(app_config)
+
+        # Get database session (migrations already run if needed)
+        _, session_maker = await db.get_or_create_db(
+            db_path=app_config.database_path,
+            db_type=db.DatabaseType.FILESYSTEM,
+        )
+        project_repository = ProjectRepository(session_maker)
+        projects = await project_repository.get_active_projects()
+
+        for project in projects:
+            console.print(f"  Indexing [cyan]{project.name}[/cyan]...")
+            logger.info(f"Starting sync for project: {project.name}")
+            sync_service = await get_sync_service(project)
+            sync_dir = Path(project.path)
+            await sync_service.sync(sync_dir, project_name=project.name)
+            logger.info(f"Sync completed for project: {project.name}")
+    finally:
+        # Clean up database connections before event loop closes
+        await db.shutdown_db()
 
 
 @app.command()
@@ -15,30 +52,52 @@ def reset(
     reindex: bool = typer.Option(False, "--reindex", help="Rebuild db index from filesystem"),
 ):  # pragma: no cover
     """Reset database (drop all tables and recreate)."""
-    if typer.confirm("This will delete all data in your db. Are you sure?"):
+    console.print(
+        "[yellow]Note:[/yellow] This only deletes the index database. "
+        "Your markdown note files will not be affected.\n"
+        "Use [green]bm reset --reindex[/green] to automatically rebuild the index afterward."
+    )
+    if typer.confirm("Reset the database index?"):
         logger.info("Resetting database...")
         config_manager = ConfigManager()
         app_config = config_manager.config
         # Get database path
         db_path = app_config.app_database_path
 
-        # Delete the database file if it exists
-        if db_path.exists():
-            db_path.unlink()
-            logger.info(f"Database file deleted: {db_path}")
+        # Delete the database file and WAL files if they exist
+        for suffix in ["", "-shm", "-wal"]:
+            path = db_path.parent / f"{db_path.name}{suffix}"
+            if path.exists():
+                try:
+                    path.unlink()
+                    logger.info(f"Deleted: {path}")
+                except OSError as e:
+                    console.print(
+                        f"[red]Error:[/red] Cannot delete {path.name}: {e}\n"
+                        "The database may be in use by another process (e.g., MCP server).\n"
+                        "Please close Claude Desktop or any other Basic Memory clients and try again."
+                    )
+                    raise typer.Exit(1)
 
-        # Reset project configuration
-        config = BasicMemoryConfig()
-        save_basic_memory_config(config_manager.config_file, config)
-        logger.info("Project configuration reset to default")
-
-        # Create a new empty database
-        asyncio.run(db.run_migrations(app_config))
-        logger.info("Database reset complete")
+        # Create a new empty database (preserves project configuration)
+        try:
+            asyncio.run(db.run_migrations(app_config))
+        except OperationalError as e:
+            if "disk I/O error" in str(e) or "database is locked" in str(e):
+                console.print(
+                    "[red]Error:[/red] Cannot access database. "
+                    "It may be in use by another process (e.g., MCP server).\n"
+                    "Please close Claude Desktop or any other Basic Memory clients and try again."
+                )
+                raise typer.Exit(1)
+            raise
+        console.print("[green]Database reset complete[/green]")
 
         if reindex:
-            # Run database sync directly
-            from basic_memory.cli.commands.command_utils import run_sync
-
-            logger.info("Rebuilding search index from filesystem...")
-            asyncio.run(run_sync(project=None))
+            projects = list(app_config.projects)
+            if not projects:
+                console.print("[yellow]No projects configured. Skipping reindex.[/yellow]")
+            else:
+                console.print(f"Rebuilding search index for {len(projects)} project(s)...")
+                asyncio.run(_reindex_projects(app_config))
+                console.print("[green]Reindex complete[/green]")
diff --git a/src/basic_memory/repository/sqlite_search_repository.py b/src/basic_memory/repository/sqlite_search_repository.py
index 3fd12235..66a39ccf 100644
--- a/src/basic_memory/repository/sqlite_search_repository.py
+++ b/src/basic_memory/repository/sqlite_search_repository.py
@@ -27,17 +27,15 @@ class SQLiteSearchRepository(SearchRepositoryBase):
     """
 
     async def init_search_index(self):
-        """Create FTS5 virtual table for search.
+        """Create FTS5 virtual table for search if it doesn't exist.
 
-        Note: Drops any existing search_index table first to ensure FTS5 virtual table creation.
-        This is necessary because Base.metadata.create_all() might create a regular table.
+        Uses CREATE VIRTUAL TABLE IF NOT EXISTS to preserve existing indexed data
+        across server restarts.
         """
         logger.info("Initializing SQLite FTS5 search index")
         try:
             async with db.scoped_session(self.session_maker) as session:
-                # Drop any existing regular or virtual table first
-                await session.execute(text("DROP TABLE IF EXISTS search_index"))
-                # Create FTS5 virtual table
+                # Create FTS5 virtual table if it doesn't exist
                 await session.execute(CREATE_SEARCH_INDEX)
                 await session.commit()
         except Exception as e:  # pragma: no cover
diff --git a/tests/mcp/clients/test_clients.py b/tests/mcp/clients/test_clients.py
index 333f9fa6..35300ba9 100644
--- a/tests/mcp/clients/test_clients.py
+++ b/tests/mcp/clients/test_clients.py
@@ -1,7 +1,7 @@
 """Tests for typed API clients."""
 
 import pytest
-from unittest.mock import AsyncMock, MagicMock
+from unittest.mock import MagicMock
 
 from basic_memory.mcp.clients import (
     KnowledgeClient,
diff --git a/tests/repository/test_search_repository.py b/tests/repository/test_search_repository.py
index 9b167a77..d19c994f 100644
--- a/tests/repository/test_search_repository.py
+++ b/tests/repository/test_search_repository.py
@@ -107,6 +107,48 @@ async def test_init_search_index(search_repository, app_config):
         assert table_name == "search_index"
 
 
+@pytest.mark.asyncio
+async def test_init_search_index_preserves_data(search_repository, search_entity):
+    """Regression test: calling init_search_index() twice should preserve indexed data.
+
+    This test prevents regression of the bug fixed in PR #503 where
+    init_search_index() was dropping existing data on every call due to
+    an unconditional DROP TABLE statement.
+
+    The bug caused search to work immediately after creating notes, but
+    return empty results after MCP server restarts (~30 minutes in Claude Desktop).
+    """
+    # Create and index a search item
+    search_row = SearchIndexRow(
+        id=search_entity.id,
+        type=SearchItemType.ENTITY.value,
+        title=search_entity.title,
+        content_stems="regression test content for server restart",
+        content_snippet="This content should persist across init_search_index calls",
+        permalink=search_entity.permalink,
+        file_path=search_entity.file_path,
+        entity_id=search_entity.id,
+        metadata={"entity_type": search_entity.entity_type},
+        created_at=search_entity.created_at,
+        updated_at=search_entity.updated_at,
+        project_id=search_repository.project_id,
+    )
+    await search_repository.index_item(search_row)
+
+    # Verify it's searchable
+    results = await search_repository.search(search_text="regression test")
+    assert len(results) == 1
+    assert results[0].title == search_entity.title
+
+    # Re-initialize the search index (simulates MCP server restart)
+    await search_repository.init_search_index()
+
+    # Verify data is still there after re-initialization
+    results_after = await search_repository.search(search_text="regression test")
+    assert len(results_after) == 1, "Search index data was lost after init_search_index()"
+    assert results_after[0].id == search_entity.id
+
+
 @pytest.mark.asyncio
 async def test_index_item(search_repository, search_entity):
     """Test indexing an item with project_id."""
diff --git a/tests/test_project_resolver.py b/tests/test_project_resolver.py
index 1d4b4e66..2383a213 100644
--- a/tests/test_project_resolver.py
+++ b/tests/test_project_resolver.py
@@ -1,6 +1,5 @@
 """Tests for ProjectResolver - unified project resolution logic."""
 
-import os
 import pytest
 from basic_memory.project_resolver import (
     ProjectResolver,