New plan, owner only?

I'm just not feeling comfortable about this one and would appreciate other's thoughts.

Company M is an LLC taxed as partnership.  Two owners, 50/50. Only one of the owners (Owner A) is actively working for Company M, the other owner works for a different company.  Owner A also owns 91% of Company K.  I'm told Company K has no employees.  Company M only has one employee (Owner A), all others are independent contractors receiving 1099's.  It is a software development firm and the website shows 12 people as "employees"  (supposedly all but the owner are 1099 contractors).  Owner A also has a owner-only 401(k) plan with an investment firm and wants to open a cash balance plan with us. 

Also found out that Owner A established residence in NY and very recently became a US citizen.  He has since returned to France and wants to use his address in France for the plan document and 5500.

It's been difficult to get details on this, so my comfort level is low.  Other questions I should be asking or information I should request?

Any help is appreciated!

Company M as the sponsoring entity will provide their registered physical address for the Doc & 5500.  The trustee must be a US entity, either the other owner or a corporate trustee will likely fill that role.  Owner A may well qualify as a US Citizen, but his primary residence in a foreign country fogs that status a bit.

Unless it will be a participating employer, Company K can likely be ignored as there is no controlled group with Company M, however you will want to rule out Affiliated Service Group as well; or make sure you can treat it as such so you can include it in A's compensation as well.

The 1099 contractors are likely questionable.  I would have him complete IRS Form SS-8(not to be filed, but for your purposes only), or separately have him answer the questions in Part II, III, & IV.  There are a few key indicators in there, one of which they already violate by publicly advertising them as "employees".

Thank you so much for your information, Nate!

I'd run this past an ERISA attorney