Merging 2 NQ plans

[alexa]

We took over a company early 2016 (stock purchase) which has an NQ plan which is employee deferral only, no employer contribution (I'll call this NQ Plan 2). Eligible employees are Associate Director or above (currently 90 are eligible, about 25 defer)

We also have a current NQ plan for 10 Executives (directly report to CEO that is employer only contributions (10% of base pay). I'll call this NQ Plan 1. Currently none of the NQ Plan 2 participate in NQ Plan 1. 1 of the NQ Plan 2 employees (reports directly to the CEO and otherwise satisfies NQ Plan 1 eligibility and we would like him to be added to NQ Plan 1 effective 1/1/18

We do not offer current Assocate Director or above any NQ plan except for the 10 executives

Both plans have rabbi trusts. Distribution payout options are different 

It was decided to merge the 2 plans 1/1/2018.Does anyone foresee any issues with the merger?

What would the steps be to merge the plans? 

An option we are considering is perhaps to freeze NQ Plan 2 instead of merging it into NQ Plan 1 eff 1/1/18. Business case is current employees at Assoc. Director level do not have access to an NQ arrangement . We are past the transition period of the stock purchase agreement

Any issues to consider here?

Can we terminate NQ Plan 2 and force distribution of all benefits? The current payout options are lump sum or installment payments. 

My recollection is that if you terminate one  NQ plan must terminate all?

Any tax issues with merging, freezing or terminating plan?

Thanks in advance for any insights.

Lexy

[alexa]

Update to above:

NQ Plan 1 allows for both base salary & bonus deferral as well.

NQ Plan 2 has base salary & bonus deferral and supplemental profit sharing contributions (this is an excess of the profit sharing of 5% of profit sharing in qualified DC plan that may be reduced in the qualified plan due to annual contribution limits). This supplmental profit sharing contribution of 5% of pay in the qualified plan ends 12/31/17 

[XTitan]

Do you really need to merge the plans?  I frequently see multiple plans record kept as if it is a single plan, but separate plan documents control.  That way, changes to plan documents don't inadvertently create delays to the distribution payments (e.g. changing the threshold for qualifying for installments to be consistent may trigger the 1 year/5 year rule).  This seems to be common when one plan is frozen for new deferrals as is contemplated here.  

If you are doing a termination and liquidation, note that NQ Plan 1 and 2 are not aggregated as NQ Plan 2 is a elective account balance plan and NQ Plan 1 is a non-elective account balance plan.  You lost the ability to do the termination and liquidation under the change in control exception since it's been longer than 12 months.  The only way to terminate the NQ Plan 2 is under the voluntary termination and liquidation provisions (the 1 year/2 year/3 year rules) and it would affect any other elective account balance plans (if any).