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The terms of the trust should specify whether or not matters such as proxy voting, tender offers ,and other shareholder matters should be handled by the legal owner (trustee) or another fiduciary or passed through to the beneficial owner (participant). If passed through to the participant, the participant would then direct the trustee concerning any action to take or not take with respect to the matter.

I thought that the whole thing that made the magic of a Rabbi Trust work was that, by subjecting the trust assets to the claims of the sponsor's creditors, it was all treated as having a substantial risk of forfeiture, so mere vesting did not create any tax liability for the person covered. Is this not so?

1. Transition Period Actually, the plans never need to merge. The "transition" rule simply provides relief from having to count *all* employees of the controlled group for coverage testing of each of the plans - until the end of the transition period (subject to being able to pass coverage individually on the day before the merger took place). If the plans can pass coverage after the end of the transition period, or can pass coverage on an aggregated basis after the end of the transition period, they can remain "un-merged." Nothing in the Code ever requires plans to merge - it just has various testing implications depending on who is covered by each of the plans, and what the (testable) benefits are in each plan. 2. VCP First, see above. The plans may be able to remain separate (or be tested on an aggregate basis) and still be viable. Second, your concern of tainting the clean plan is valid. Consider instead of merging the plans (if necessary), simply freezing the dirty plan while seeking the IRS's blessing of the VCP filing, and letting all the employees participate in the other ("clean") plan - amended however the employer sees fit. When (and if) the IRS rules on the VCP application, the "dirty" plan can be cleaned up and merged into the other plan.

Depends on whether the document excludes compensation prior to entry.

My main concern in reading David's post and then this one is that they might not make it obvious enough for a non-expert to recognize the heavy dose of sarcasm. In case there is any doubt, those items described as not involving any risk are, in fact, definitely possible sources of risk arising from the proposed strategy. What do they say about lending money to a friend or family? As one quote points out, "Thanksgiving Dinner tastes better when nobody at the table owes money to another person at the table."