Yes
No. BUT this is only the case if the employees are eligible solely because they met the LTPT criteria, and only if the employer elects to exclude LTPTEs from the application of ADP/ACP, 401(a)(4), 410(b), and the 401(k)/(m) safe harbors.
See 1.401(k)-5(f)(1) of the proposed regulations:
https://www.federalregister.gov/d/2023-25987/p-230