If a company with an existing SIMPLE IRA plan (previous owner and one employee) were purchased mid-year, what are the options for funding a SIMPLE IRA going forward? We received information that indicated the following, but wanted some confirmation:

For 2011:
Existing plan would continue to be funded as directed under existing plan document for the previous owner and one employee by the new company.
The new owner would not be able to participate for 2011. He could fund a traditional IRA only?
Provide notice to employees that current plan will terminate 12/31/2011 and new plan will commence 1/1/2012

For 2012:
New owner and all eligible employees would be able to participate in the new Simple IRA plan.
Previous owner and employee could transfer their existing Simple IRA accounts into the new Simple IRA or leave as is.