The first pilot, a certificated helicopter flight instructor, was providing primary helicopter flight instruction to the second pilot, a certificated commercial airplane pilot. The first pilot said that while in a stable 3-foot hover above ground, he asked the second pilot to relinquish control of the helicopter so he could demonstrate a maneuver. During the transfer of control, the cyclic slipped from the first pilot's hand, and the cyclic traveled to a full forward position. The helicopter pitched nose down, and the main rotor blades struck the ground. The helicopter subsequently rolled to the right, and sustained substantial damage to the main rotor drive system, main rotor blades, and fuselage. A postaccident inspection of the helicopter revealed that the second pilot had inadvertently selected the cyclic trim system to the full forward position. The operator reported that there were no preaccident mechanical anomalies with the helicopter.