Forms and Signatures in Acrobat Reader

I am trying to create a form that can be filled out and signed in Acrobat Reader. I am creating the form in Adobe Pro 9 and have No Security set for the document and have enabled the extended features in Adobe Reader under the 'Advanced' menu. The document security does indicate that signing and filling in forms is 'allowed'.
When the form is then opened in Reader X, when the "Sign" menu is selected, the user is receiving the error message that the document's security settings do not allow for signing of this document and it must be printed.
Does anyone have any idea what I am missing?

Please verify the following:
1. The system date on your machine.
2. The PDF properties post opening the PDF in Adobe Reader. If possible please post as screenshot of the same.
3. If you are getting a panel in Adobe Reader X with the label "Extended".
4. If you are on the latest version of Adobe Reader i.e. 10.1.4.

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