Failing to enroll eligible participants

[Guest ANNEBV]

Company A has a 401(k) plan. Company X acquired 100% of Company A in 1999. The intention was to close Company A's operations and terminate Company A's plan in 1999. However, as of today, Company A is still in operation (& still fully owned by Company X) and the plan was never terminated. Furthermore, newly eligible employees at Company A were not allowed to enter the Company A 401(k) plan during the latter portion of 1999 and for all of 2000 (and thus far in 2001, for that matter).

So, basically, despite being acquired in 1999, nothing has changed at Company A...except that Company A has not been operating it's plan in compliance with it's terms.

What is the best correction method/approach for failing to allow otherwise eligible participants to join the plan?