Ur steps almost okay, though please go for this with GUI setup first….The actual steps is here
1. Administrator must enable password checking on each server with which these users authenticate. To do this, open each Server document in the Domino Directory (names.nsf) and next to the Check Passwords on Notes in the Security section, select Enabled.
2. Save and Restart that server
NOTES: Make sure that Administration Process is set up in the Notes domain.
Now open People view of the NAB, on the Administration Server
a. Select Check Password in the Administration section of each user’s Person document.
b. In Public NAB, selected Person document(s) from the Actions menu, select Set Password Fields
c. Select Check password
d. Next Required Change Interval, enter the number of days and next to Grace Period, indicates the number of days after a required change and save these changes
Remember, always allow Address Book and Admin4 replication.
e. Now run admin4.nsf, this helps to generate a Set Password Information text
NOTE: If a user attempts to use a with an old password and accesses the home server, a warning message will display.
For more clear info :