Company sold division - year end profit share question

[pmacduff]

Here is background:  client sold a portion of Company in May of 2016 and a large group of employees transferred to the new Company and were treated as termed under the old for payroll, benefits, etc.  The original plan remains in effect though much smaller.  (Partial termination rules applied)  Original plan has last day rule for profit share but does allow that termed participants who meet early (age 55 and 10 yrs) or normal (age 65) retirement will receive an allocation regardless of hours worked.    So....original Company intends to make a profit share for 2016.  Are those participants who went to the other Company that fall in to the "early" or "normal" retirement categories eligible to share in the profit share for the old Company?  I thought yes at first but then the question was asked because they did not actually "retire" but rather went to work for the other Company.    Thanks in advance.

[ESOP Guy]

Read the definition of early and normal retirement in the document it will answer this question. 

If it is like most plans I see the definition will be ANY termination after being a given age and/or service. 

Rarely does it define it any other way.  So my guess (and it is a guess at this point) is you will find upon careful reading of the document that they did retire. 

[K2]

And there are implications for coverage testing as well.  What is the correct treatment of all of those spun-off employees?  Are they 'non benefiting' but in your test denominator?