Marr. of Honer

I. BACKGROUND

Thomas (Tom) and Penny Honer (Penny) were married in 1982 and separated in 2009. During their long marriage, Tom and Penny1 together purchased and built up several grocery stores, two of which remained primary marital assets at the time of their separation: Harvest Market in Fort Bragg and Harvest Market at Mendosa’s in Mendocino (Mendosa’s). The Honers opened Harvest Market in 1985 and acquired Mendosa’s in 2006. The businesses were held by Cypress Holdings, Inc. (Cypress Holdings), an S corporation. Tom was and is president and CEO of Cypress Holdings and Penny was Vice President. The Honers’ markets found success by specializing in an upscale niche for specialty foods and natural and organic products. Tom managed the grocery stores, while Penny designed the logo, decorated the markets, and took care of administrative tasks, such as payroll, billing, advertising, employee training, and customer relations. She also computerized their operations and participated in entertaining business contacts. Cypress Holdings paid Tom a base salary of $260,000 per year for his work in the markets, and he also earned $18,600 as a director of a bank. Penny did not draw a salary…