2 issues to address: (1) dependency on one employee and (2) dealing with a difficult employee. Both are addressed below.

(1) Ask yourself why you feel dependent on this employee. If it is merely because of what he does, then finding an alternative is not too hard. It may mean spreading the work between other people (you included), and it may mean others being busier for a while. Consider what you can outsource or automate, or hire a temp to cover. That is better than allowing toxic attitudes in the workplace.
If it is because of knowledge he has or relationships he has with clients, start working right now to change that. Find ways to capture and share information, make sure your clients associate positive experiences with the company as well as the people. If your employees capture knowledge in their heads then start new procedures to manage a CRM Or system to keep client files up to date.
Never let an employee hold your business hostage.

(2) Dealing with a difficult employee - there are good tips here already. I don't know how close your relationship with this person is but remember that the workplace is not the back-yard: loyalty is rewarded but loyalty is not the same as longevity or seniority. If he is causing damage to your business, that is not loyalty.
Have a clear conversation, talk about the work issues: is he dropping the ball? Is he not doing what is expected? Is he not performing to your required business standards? Ask him if there is something he doesn't understand, or if he wants more training. In essence: when you speak with him come to the table with solutions. If he refuses each one, then give him his warning and be explicit about what that means.

Best of luck with this difficult situation!