Asset Sale - Buyer Assumption

[sdix401k]

So I have a situation where Company B will be doing an asset purchase of all of Company A's employees. Company B is new structure of Company A. So an assumption of the plan is presumed to be fine.

The issue is that the new Company B will actually consist of Company B and C with employees going to different companies both B and C. There is no issue in setting up another plan with the same provisions as the assumed plan for Company C.

My question is does there need to be corporate event- transaction to do a asset transfer or trust to trust transfer of some of the participant accounts from the assumed plan to a new plan for Company C after the asset sale is done?

Should this be done during the asset sale. It just does not make sense to me to have an assumption and at the same time split the plan assets. It seems to me there should be an order to follow.

Step 1 - Assume the plan by the buyer

Step 2 - Trust to Trust Transfer for those employees of Company C

The other option would be to do an asset transfer from the Company A Plan to new Plans set up for Company B and C. ( All three plans would be exactly the same. Plan is 100% vested already.) In this scenario we would have to terminate Company A's plan after transfer.

Other than Board Resolutions and language needed in the asset sale agreement I do not think a 5310-a is needed.

Any thoughts on either scenario?

[QDROphile]

I thought purchasing employees went out sometime in the 1860s