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PS, maybe someone else on this board knows, but I don't. With a 401(a) plan, the plan sponsor generally has the power to amend the plan into another type of plan (but not from DB to DC or vice versa), or to cause the plan to be merged into another plan. Here, you're talking really about terminating the K plan and requiring rollovers to the IRAs. Of course, the employer could suggest to the employees that they do that, but I am unaware of an ability to require it. Why does the plan sponsor care? When the K plan terminates everyone will be fully vested, of course. Why is it important to the plan sponsor that the SIMPLE start out with the K dollars, rather than just starting afresh and letting participants roll to their SIMPLE IRAs if they want?

Yes, but make sure your plan document allows for in-kind distributions so that nothing has to be sold to cash/re-purchased. And keep an eye out for any RMD concerns, as well!

Loans are not a protected benefit, and eliminating the availability of loans is not a prohibited cutback. 1.411(d)-4(d)(4)