<PAGE>

                                                                    EXHIBIT 10.9


                 PUTNAM FLEXIBLE 401(K) AND PROFIT SHARING PLAN

                               PLAN AGREEMENT #001


This is the Plan Agreement for a Putnam nonstandardized prototype 401(k) plan
with optional profit sharing plan provisions. Please consult a tax or legal
advisor and review the entire form before you sign it. If you fail to fill out
this Putnam Plan Agreement properly, the Plan may be disqualified. By executing
this Plan Agreement, the Employer establishes a 401(k) and profit sharing plan
and trust upon the terms and conditions of Putnam Basic Plan Document #07, as
supplemented and modified by the provisions elected by the Employer in this Plan
Agreement. This Plan Agreement must be accepted by Putnam in order for the
Employer to receive future amendments to the Putnam Flexible 401(k) and Profit
Sharing Plan.

                                    * * * * *



1.   Employer Information. The Employer adopting this Plan is:
     --------------------

     A.   Employer Name:     Benthos, Inc.
          --------------     -------------

     B.   Employer Identification Number:     04-2381876
          -------------------------------     ----------

     C.   Employer Address:     49 Edgerton Drive
          -----------------     -----------------
                                N. Falmouth, MA 02556
                                ---------------------

     D.   SIC Code:             3815
          ---------             ----

     E.   Employer Contact:     Name: Kathryn Busa -- Human Resources
          -----------------     -------------------------------------

                                      Frank Dunne -- CFO
                                      ------------------

                                Phone #: 508-563-1000
                                         ------------


     F.   Fiscal Year: October 1 through September 30
          ------------ ---------         ------------
                      (month/day)        (month/day)

     G. Type of Entity (check one):
          ---------------------------

          [X] Corporation    [ ] Partnership       [ ] Subchapter S Corporation

          [ ] Sole proprietorship      [ ]     Other _____

     H.   Plan Name: Benthos, Inc. 401(k) Retirement Plan
          ---------  ------------------------------------

     I.   Plan Number: 002 (complete)
          -----------    -
<PAGE>

2.   Plan Information.
     ----------------

     A.   Plan Year. Check one:
          ---------
          [ ]  (1) The Calendar Year

          [X]  (2) The Plan Year will be the same as the Fiscal Year of the
                   Employer shown in 1.F. above. If the Fiscal Year of the
                   Employer changes, the Plan Year will change accordingly.

          [ ]  (3) The Plan Year will be the period of 12 months beginning on
                   the first day of ___________ (month) and ending on the
                   last day of________ (month).

          [ ]  (4) A short Plan Year commencing on ____________ (month/day/year)
                   and ending on ____________ (month/day/year) and immediately
                   thereafter the 12-consecutive month period commencing on
                   _____________ (month/day).

          The Plan Year will also be your Plan's Limitation Year for purposes of
          the contribution limitation rules in Article 6 of the Plan.

     B.   Effective Date of Adoption of Plan.

          (1) Are you adopting this Plan to replace an existing plan?

               [X]    (a) Yes     [ ]    (b) No

          (2)  If you answered Yes in 2.B(1) above,  the Effective Date of your
               -------------------
               adoption of this Replacement Plan will be the first day of the
               current Plan Year unless you elect a later date in (2)(b) below.
               Please complete the following:


                                    (a) July 1,1987
                                        -----------
                         Original Effective Date of the Plan you are Replacing

                                    (b) July 1,1999
                                        -----------
                         Effective Date of this Replacement Plan

          (3)  If you answered No in 2B(1) above, the Effective Date of your
               ------------------
               adoption of this Plan will be the day you select below (not
               before the first day of the current Plan Year, and not before the
               day your Business began):

                       (a) The Effective Date is: ______________
                                                  month/day/year


                                       2
<PAGE>

     C.   Identifying Highly Compensated  Employees.  Check either (1) or (2).

          [X]   (1) The Plan will use the regular method under Plan Section
                    2.58(a) for identifying Highly Compensated Employees.

                    If you selected this option and your Plan Year is the
                    calendar year, do you wish to make the regular method's
                    "calendar year election" for identifying your Highly
                    Compensated Employees?

                    [ ]  (a) Yes   [ ]  (b) No

          [ ]   (2) The Plan will use the simplified method under Plan
                    Section 2.58(b) for identifying Highly Compensated
                    Employees.

3.   Eligibility for Plan Participation (Plan Section 3.1). Employees will be
     ------------------------------------------------------
     eligible to participate in the Plan when they complete the requirements you
     select in A, B, C and D below.

     A.   Classes of Eligible Employees. The Plan will cover all employees who
          -----------------------------
          have met the age and service requirements with the following
          exclusions:

          [ ]  (1) No exclusions. All job classifications will be eligible.

          [X]  (2) The Plan will exclude employees in a unit of Employees
               covered by a collective bargaining agreement with respect to
               which retirement benefits were the subject of good faith
               bargaining, with the exception of the following collective
               bargaining units, which will be included: ____.

          [X]  (3) The Plan will exclude employees who are non-resident aliens
               without U.S. source income.

          [ ]  (4) Employees of the following Affiliated Employers (specify):

                   -------

                   -------

          [X]  (5) Leased Employees

          [X]  (6) Employees in the following other classes (specify):
               commission salespeople
               ----------------------

               temporary employees
               -------------------


                                       3
<PAGE>

     B. Age Requirement (check and complete (1) or (2)):
        ---------------

        [ ]   (1)  No minimum age required for participation

        [X]   (2) Employees must reach age 19 (not over 21) to participate
                                           --

     C. Service Requirements.
        ---------------------

        (1)  Elective Deferrals. To become eligible, an employee must complete
             ------------------
             (choose one):

             [X] (a) No minimum service required.

             [ ] (b) One 6-month Eligibility Period

             [ ] (c) One _____-month Eligibility Period (must be less than 12)

             [ ] (d) One 12-month Eligibility Period

        (2)  Employer Matching Contributions:  To become eligible, an employee
             -------------------------------
             must complete (choose one):

             [ ] (a) No minimum service required.

             [ ] (b) One 6-month Eligibility Period

             [ ] (c) One _____-month Eligibility Period (must be less than 12)

             [X] (d) One 12-month Eligibility Period

             [ ] (e) Two 12-month Eligibility Periods (may only be chosen if
                     you adopt the vesting schedule under item 9.A(3)(a) to
                     provide 100% full and immediate vesting of Employer
                     Matching Contributions).

             [ ] (f) Not applicable. The Employer will not make Employer
                     Matching Contributions.

        (3)  Profit Sharing  Contributions.  To become  eligible,  an employee
             -----------------------------
             must complete (choose one):

             [ ] (a) No minimum service required.

             [ ] (b) One 6-month Eligibility Period

             [ ] (c) One _____-month Eligibility Period (must be less than 12)

             [X] (d) One 12-month Eligibility Period



                                       4
<PAGE>

               [ ]  (e) Two 12-month Eligibility Periods (may only be chosen
                    if you adopt the vesting schedule under item 9.A(3)(a) to
                    provide for 100% full and immediate vesting of Profit
                    Sharing Contributions)

               [ ]  (f) Not applicable. The Employer will not make Profit
                    Sharing Contributions.

          (4)  If the Employer acquired a business on or before the Effective
               Date of this Plan and the Eligibility Periods selected in (1),
               (2) and (3) for former employees of that acquired business will
               include the former employees' periods of employment with that
               business, list the business below. Any acquired business which
               had a plan which the Employer now maintains must be listed below.


               --------


               --------

          (5)  If the Employer acquires a business after the Effective Date, the
               Eligibility Periods for an employee of the acquired business will
               be the periods selected in (1), (2) and (3) beginning on (check
               (a) or (b)):

               [ ]  (a) the date the employee began work with the acquired
                    business.

               [X]  (b) the date of the acquisition (i.e., the date the employee
                    begins work for the Employer).

          (6)  Hours of Service for Eligibility Periods.
               ----------------------------------------

               (a)  6-Month Eligibility Period. To receive credit for a 6-month
                    Eligibility Period, an employee must complete 6 months of
                    service, during which he completes at least:

                    [ ]  (i) 500 Hours of Service

                    [ ]  (ii)  _____ Hours of Service (under 500)

               (b)  12-Month Eligibility Period. To receive credit for a 12-
                    ---------------------------
                    month Eligibility Period, an employee must complete 12
                    months of service, during which he completes at least:

                    [X]  (i) 1,000 Hours of Service

                    [ ]  (ii) _____ Hours of Service (under 1,000)



                                       5
<PAGE>

               (c)  Other Eligibility Period. To receive credit for the
                    ------------------------
                    Eligibility Period selected in 3.C(1)(c), 3.C(2)(c) and/or
                    3.C(3)(c) above, an employee must complete during it at
                    least:

                    [ ] (i) _____ Hours of Service (under 1000)


          (7)  Method of Crediting Hours of Service For Eligibility and Vesting.
               ----------------------------------------------------------------
               Hours of Service will be credited to an employee by the following
               method (check one):

               [X]  (a) Actual hours for which an employee is paid

               [ ]  (b) Any employee who has one actual paid hour in the
                    following period will be credited with the number of Hours
                    of Service indicated (check one):

                    [ ]  (i)   Day (10 Hours of Service)

                    [ ]  (ii)  Week (45 Hours of Service)

                    [ ]  (iii) Semi-monthly payroll period (95 Hours of Service)

                    [ ]  (iv)  Month (190 Hours of Service)

          (8)  Entry Dates. Each employee in an eligible class who completes the
               -----------
               age and service requirements specified above will begin to
               participate in the Plan on (check one):

               [ ]  (a) The first day of the month in which he fulfills the
                    requirements.

               [X]  (b) The first of the following dates occurring after he
                    fulfills the requirements (check one):

                    [ ]  (i)   The first day of the month following the date he
                               fulfills the requirements (monthly).

                    [X]  (ii)  The first day of the first, fourth, seventh and
                               tenth months in a Plan Year (quarterly).

                    [ ]  (iii) The first day of the first month and the seventh
                               month in a Plan Year (semiannually).

               [ ]  (c) Other: _____ (May be no later than (i) the first day of
                    the Plan Year after which he fulfills the requirements, and
                    (ii) the date six months after the date on which he fulfills
                    the requirements, which ever occurs first.)

                                       6
<PAGE>

D.   (For New Plans Only) Will all eligible Employees as of the Effective Date
     be required to meet the age and service requirements for participation
     specified in B and C above?

    [ ] (a) Yes


    [ ] (b) No. Eligible Employees will be eligible to become Participants
            as of the Effective Date even if they have not satisfied (check one
            or both):

            [ ]  (i)  the age requirement.

            [ ]  (ii) the service requirement.

4.   Contributions.
     -------------
     A.   Elective Deferrals (Plan Section 5.2). Your Plan will allow employees
          -------------------------------------
          to elect pre-tax contributions under Section 401(k) of the Code. You
          must complete this part A.


          (1)  A Participant may make Elective Deferrals for each year in an
               amount not to exceed (check one):

               [X] (a) 15% of his Earnings
                       --

               [ ] (b) _____% of his Earnings not to exceed $_____ (specify a
                   dollar amount)

               [ ] (c) $_____ (specify a dollar amount)

          (2)  Will a Participant be required to make a minimum Elective
               Deferral in order to make Elective Deferrals under the Plan?
               (check one and complete as applicable)

               [X] (a)  No.

               [ ] (b)  Yes. The minimum Elective Deferral will be ____% of the
                        Participant's Earnings.

          (3)  A Participant may begin to make Elective Deferrals, or change the
               amount of his Elective Deferrals, as of the following dates
               (check one):

               [ ]  (a) First business day of each month (monthly).

               [X]  (b) First business day of the first, fourth, seventh and
                        tenth months of the Plan Year (quarterly).

               [ ]  (c) First business day of the first and seventh months of
                        the Plan Year (semiannually).

               [ ]  (d) First business day of the Plan Year only (annually).

               [ ]  (e) Other: ______


                                       7
<PAGE>

          (4)  Will Participants be permitted to make separate Elective
               Deferrals of bonuses, even if bonuses have otherwise been
               excluded from Compensation for the purpose of Elective Deferrals
               under 7.A(l)?

               [ ]   (a)  Yes     [X]    (b)  No


     B.   Employer Matching Contributions. (Plan Section 5.8). Complete this
          -------------------------------
          part B only if you will make Employer Matching Contributions under the
          Plan.


          (1)  The Employer will contribute and will allocate to each Qualified
               Participant's Employee Matching Account an Employer Matching
               Contribution on the basis set forth below:

               [X]  (a) Discretionary matching contributions. (The Employer may
                        select this option in addition to option (b) if the
                        Employer wishes to have the option to make discretionary
                        matching contributions in addition to fixed matching
                        contributions.)

               [ ]  (b) Fixed matching contributions.

                        [ ]   (i) based on Elective Deferrals:

                              [ ] (A) _____% of Elective Deferrals


                              [ ] (B) _____% of Elective Deferrals up to
                                      _____% of Earnings.

                              [ ] (C) _____% of Elective Deferrals up to
                                      _____% of Earnings and _____% of Elective
                                      Deferrals over that percentage of Earnings
                                      and up to _____% of Earnings. (The third
                                      percentage number must be less than the
                                      first percentage number.)

                              [ ] (D) _____% of Elective Deferrals up to
                                      $_______  of Elective Deferrals.

                              [ ] (E) _____% of Elective Deferrals up to
                                      $_______ of Elective Deferrals and ___% of
                                      Elective Deferrals over that dollar
                                      amount and up to $______ of Elective
                                      Deferrals. (The last percentage must be
                                      less than the first percentage).


                                       8
<PAGE>

                    [ ]  (ii)  based on after-tax Participant Contributions:

                         [ ]   (A) _____% of Participant Contributions

                         [ ]   (B) _____% of Participant Contributions up
                                   to _____% of Earnings.

                         [ ]   (C) _____% of Participant Contributions up
                                   to _____% of Earnings and _____% of
                                   Participant Contributions over that
                                   percentage of Earnings and up to ______ % of
                                   Participant Contributions. (The third
                                   percentage must be less than the first
                                   percentage)

                         [ ]   (D)  _____% of Participant Contributions up
                                   to $_____ of Participant Contributions.

                         [ ]   (E) _____% of Participant Contributions up
                                   to $_____ of Participant Contributions and
                                   _____% of Participant Contributions over that
                                   dollar amount and up to $_____ of Participant
                                   Contributions. (The last percentage must be
                                   less than the first percentage).

          (2)  Qualified Participant. In order to receive an allocation of
               ---------------------
               Employer Matching Contributions for a Plan Year, an Employee must
               be a Qualified Participant for that purpose. Select below either
               (a) alone, or any combination of (b), (c) and (d).

               [ ]  (a) To be a Qualified Participant eligible to receive
                        Employer Matching Contributions for a Plan Year,
                        an Employee must (check (i) or (ii)):

                        [ ] (i)   Either be employed on the last day of
                                  the Plan Year, complete more than 500 Hours
                                  of Service in the Plan Year, or retire, die
                                  or become disabled in the Plan Year.

                        [ ] (ii)  Either be employed on the last day of
                                  the Plan Year or complete more than 500
                                  Hours of Service in the Plan Year.

               Stop here if you checked (a). If you did not check (a), check
               (b), (c) or (d), or any combination of (b), (c) and (d).


                                       9
<PAGE>

               To be a Qualified Participant eligible to receive Employer
               Matching Contributions for a Plan Year, an Employee must:

               [X]    (b)  Be credited with 1 (choose 1, 501 or 1,000) Hours of
                                            -
                           Service in the Plan Year.

               [ ]    (c)  Be an Employee on the last day of the Plan Year.

               [X]    (d)  Retire, die or become disabled during the Plan Year.

          (3)  Will the Employer have the option of making all or any portion of
               its Employer Matching Contributions in Employer Stock?

               [ ]     (a)   Yes             [X]      (b)       No

     C.    Profit Sharing Contributions. (Plan Sections 4.1 and 4.2)
           ----------------------------

          (1)  Profit Limitation.  Will Profit Sharing Contributions to the Plan
               -----------------
               be limited to the current and accumulated profits of your
               Business? Check one:

               [ ]     (a)   Yes             [X]      (b)       No

          (2)  Amount. The Employer will contribute to the Plan for each Plan
               ------
               Year (check one):

               [X]    (a)  An amount chosen by the Employer from year to year

               [ ]    (b)  _____% of the Earnings of all Qualified Participants
                           for the Plan Year
               [ ]    (c)  $_____ for each Qualified Participant per_____ (enter
                           time period, e.g. payroll period, plan year)

          (3)  Allocations to Participants
               ---------------------------

               (a)  Allocation to Participants. Profit Sharing Contributions
                    --------------------------
                    will be allocated:

               [X]    (i) Pro rata (percentage based on compensation)

               [ ]    (ii) Uniform Dollar amount

               [ ]    (iii) Integrated With Social Security (complete (b) and
                            (c) below)

               (b)  Integration with Social Security. (Complete only if you have
                    --------------------------------
                    elected in 4.C(3)(a) to integrate your Plan with Social
                    Security.) Profit Sharing Contributions will be allocated to
                    Qualified Participants as you check below:


                                       10
<PAGE>

               [ ]  (i)  Profit Sharing Contributions will be allocated
                         according to the Top-Heavy Integration Formula in Plan
                         Section 4.2(c)(l) in every Plan Year, whether or not
                         the Plan is top-heavy.

               [ ]  (ii) Profit Sharing Contributions will be allocated
                         according to the Top-Heavy Integration Formula in Plan
                         Section 4.2(c)(1) only in Plan Years in which the Plan
                         is top-heavy. In all other Plan Years, contributions
                         will be allocated according to the Non-Top-Heavy
                         Integration Formula in Plan Section 4.2(c)(2).

          (c)  Integration Level.  (Complete only if you have elected in
               ------------------
               4.C(3)(a) to integrate your Plan with Social Security.) The
               Integration Level will be (check one):

               [ ] (i)   The Social Security Wage Base in effect at the
                         beginning of the Plan Year.

               [ ] (ii)  _____% (not more than 100%) of the Social
                         Security Wage Base in effect at the beginning of the
                         Plan Year.

               [ ] (iii) $_____  (not more  than the  Social  Security  Wage
                         Base).

               Note:  The Social Security Wage Base is indexed annually to
               ----
                      reflect increases in the cost of living.

          (4)  Qualified Participants. In order to receive an allocation of
               ----------------------
               Profit Sharing Contributions for a Plan Year, an Employee must be
               a Qualified Participant for this purpose. Select below either (a)
               alone, or any combination of (b), (c) and (d).

               [ ] (a) To be a Qualified Participant eligible to receive
                       an allocation of Profit Sharing Contributions for a Plan
                       Year, an Employee must (check (i) or (ii)):

                       [ ] (i)  Either be employed on the last day of the Plan
                                Year, complete more than 500 Hours of Service in
                                the Plan Year, or retire, die or become disabled
                                in the Plan Year.

                       [ ] (ii) Either be employed on the last day of the Plan
                                Year or complete more than 500 Hours of Service
                                in the Plan Year.

               Stop here if you checked (a). If you did not check (a), check
               (b), (c) or (d), or any combination of (b), (c) and (d).


                                       11
<PAGE>

               To be a Qualified Participant eligible to receive an allocation
               of Profit Sharing Contributions for a Plan Year, an Employee
               must:

               [X] (b) Be credited with 1,000 (choose 1, 501 or 1,000)
                                        -----
                       Hours of Service in the Plan Year.

               [X] (c) Be an Employee on the last day of the Plan Year.

               [X] (d) Retire, die or become disabled during the Plan Year.

     D.   Participant Contributions (Plan Section 4.6).  Will your Plan allow
          -------------------------------------------
          Participants to make after-tax contributions?

               [ ]  (1)  Yes     [X]    (2)  No


     E.   Qualified Matching Contributions (Plan Section 2.61). Skip this part E
          ----------------------------------------------------
          if you will not make Qualified Matching Contributions. N/A

          (1)  Qualified Matching Contributions will be made with respect to
               (check one):

               [ ]   (a)  Elective Deferrals made by all Qualified Participants
                          (as defined in 4.B(2))

               [ ]   (b)  Elective Deferrals made only by Qualified Participants
                          (as defined in 4.B(2)) who are not Highly Compensated
                          Participants


          (2)  The amount of Qualified Matching Contributions made with respect
               to a Participant will be:

               [ ]   (a)  discretionary

               [ ]   (b)  fixed (check and complete (i), (ii) or (iii))

                          [ ]   (i)  _____% of Elective Deferrals

                          [ ]   (ii) _____% of Elective  Deferrals that do not
                                     exceed _____% of Earnings

                          [ ]   (iii) _____% of Elective Deferrals that do not
                                      exceed $________.


                                       12
<PAGE>

     F.   Qualified Nonelective Contributions (Plan Section 2.62): Skip this
          -------------------------------------------------------
          part F if you will not make Qualified Nonelective Contributions. N/A

          (1)  Qualified Nonelective Contributions will be made on behalf of
               (check either (a) or (b) and either (c) or (d)):

               [ ] (a) All Participants

               [ ] (b) Only Participants who are not Highly Compensated
                       Employees who also, for the Plan Year for which the
                       Qualified Nonelective Contributions are made

               [ ] (c) Are Qualified Participants (as defined in 4.C(4))

               [ ] (d) Made Elective Deferrals

          (2)  The amount of Qualified Nonelective Contributions for a Plan Year
               will be (check one):

               [ ] (a)   _____% (not over 15%) of the Earnings of
                         Participants on whose behalf Qualified Nonelective
                         Contributions are made

               [ ] (b)   An amount determined by the Employer from year to
                         year, to be shared in proportion to their Earnings by
                         Participants on whose behalf Qualified Nonelective
                         Contributions are made

     G.   Forfeitures

          (1)  Employer Matching Contributions. Forfeitures of Employer Matching
               -------------------------------
               Contributions will be used as follows (check and complete (a) or
               (b)):

               [ ]  (a) Applied to reduce the following contributions required
                    of the Employer (check (i) and/or (ii)):

                    [ ]  (i) Employer Matching Contributions

                    [ ]  (ii) Profit Sharing Contributions

               [X]  (b) Reallocated as follows (check (i) or (ii)):

                    [X]  (i) As additional Employer Matching Contributions

                    [ ]  (ii) As additional Profit Sharing Contributions


                                       13
<PAGE>

          (2)  Profit Sharing Contributions. Forfeitures of Profit Sharing
               Contributions will be used as follows (check (a) or (b)):

               [ ] (a) Applied to reduce the following contributions
                       required of the Employer (check (i) and/or (ii)):

                       [ ]    (i)   Profit Sharing Contributions

                       [ ]    (ii)  Employer Matching Contributions

               [X] (b) Reallocated as additional Profit Sharing Contributions

5.   Top-Heavy Minimum Contributions (Plan Section 14.3). Skip paragraphs A and
     ---------------------------------------------------
     B below if you do not maintain any other qualified plan in addition to this
     Plan.

     A.   For any Plan Year in which the Plan is Top-Heavy, the Top-Heavy
          minimum contribution (or benefit) for Non-Key employees participating
          both in this Plan and another qualified plan maintained by the
          Employer will be provided in (check one):

          [ ]  (1) This Plan      [ ]  (2)  The other qualified plan

     B.   If you maintain a defined benefit plan in addition to this Plan, and
          the Top-Heavy Ratio (as defined in Plan Section 14.2(c)) for the
          combined plans is between 60% and 90%, you may elect to provide an
          increased minimum allocation or benefit pursuant to Plan Section 14.4.
          Specify your election by completing the statement below:

          The Employer will provide an increased (specify contribution or
          benefit)_____ in its (specify defined contribution or defined
          benefit)_____ plan as permitted under Plan Section 14.4.

6.   Other Plans.  You must complete this section if you maintain or ever
     -----------
     maintained another qualified plan in which any Participant in this Plan is
     (or was) a participant or could become a participant. The Plan and your
     other plan(s) combined will meet the contribution limitation rules in
     Article 6 of the Plan as you specify below:

     A.   If a Participant in the Plan is covered under another qualified
          defined contribution plan maintained by your Business, other than a
          master or prototype plan (check one):

          [ ] (1)   The provisions of Section 6.2 of the Plan will apply
                    as if the other plan were a master or prototype plan.

          [ ] (2)   The plans will limit total annual additions to the
                    maximum permissible amount, and will properly reduce any
                    excess amounts, in the manner you describe below.

                    ---------

                    ---------


                                       14
<PAGE>

     B.   If a Participant in the Plan is or has ever been a participant in a
          defined benefit plan maintained by your Business, the plans will meet
          the limits of Article 6 in the manner you describe below:

          ---------

          If your Business has ever maintained a defined benefit plan, state
          below the interest rate and mortality table to be used in establishing
          the present value of any benefit under the defined benefit plan for
          purposes of computing the top-heavy ratio:

                    Interest rate: ______%
                    Mortality Table: ______

7.   Compensation (Plan Section 2.8).
     -------------------------------

     A.   Amount.
          ------

           (1) Elective Deferrals and Employer Matching Contributions.
               ------------------------------------------------------
               Compensation for the purposes of determining the amount and
               allocation of Elective Deferrals and Employer Matching
               Contributions will be determined as follows (choose either (a) or
               (b), and (c) and/or (d) as applicable).

               [X] (a)  Compensation will include Form W-2 earnings as
                        defined in Section 2.8 of the Plan.

               [ ] (b)  Compensation will include all compensation
                        included in the definition of Code Section 415
                        Compensation in Plan Section 6.5(b) of the Plan.

               [X] (c)  In addition to the amount provided in either (a) or
                        (b) above, Compensation will also include any amounts
                        withheld from the employee under a 401(k) plan,
                        cafeteria plan, SARSEP, tax sheltered 403(b)
                        arrangement, or Code Section 457 deferred compensation
                        plan, and contributions described in Code Section 41
                        4(h)(2) that are picked up by a governmental employer.

               [X] (d)  Compensation will also exclude the following amount
                        (choose each that applies):

               [X]  (i)   overtime pay.

               [ ]  (ii)  bonuses.

               [X]  (iii) commissions.

               [X]  (iv)  other pay (describe): services of a type
                                                ------------------
                          customarily performed by outside contractors
                          --------------------------------------------


               [ ]  (v)   compensation in excess of $ ______


                                       15
<PAGE>

               (2)  Profit Sharing Contributions.  Compensation for the purposes
                    ----------------------------
                    of determining the amount and allocation of Profit Sharing
                    Contributions shall be determined as follows (choose either
                    (a) or (b), and (c) and/or (d), as applicable).

                    [X]  (a) Compensation will include Form W-2 earnings as
                             defined in Section 2.8 of the Plan.

                    [ ]  (b) Compensation will include all compensation included
                             in the definition of Code Section 415 Compensation
                             in Section 6.5(b) of the Plan.

                    [X]  (c)  In addition to the amount provided in either (a)
                              or (b) above, compensation will also include any
                              amounts withheld from the employee under a 401(k)
                              plan, cafeteria plan, SARSEP, tax sheltered 403(b)
                              arrangement, or Code Section 457 deferred
                              compensation plan, and contributions described in
                              Code Section 414(h)(2) that are picked up by a
                              governmental employer.

                    [X]  (d)  Compensation will also exclude the following
                              amounts (choose each that applies):

                              [ ]  (i)   overtime pay

                              [X]  (ii)  bonuses

                              [X]  (iii) commissions

                              [X]  (iv)  other pay (describe): services of a
                                         type customarily performed by outside
                                         contractors

                              [ ]  (v)   compensation in excess of $ ______

                         Note: No exclusion under (d) may be selected if
                         Profit Sharing Contributions will be integrated
                         with Social Security under 4.C(3)(a)(iii). In
                         addition, no exclusion under (d) will apply for
                         purposes of determining the top-heavy minimum
                         contribution if the Plan is top-heavy.


     B.   Measuring Period. Compensation will be based on the Plan Year.
          ----------------
          However, for an Employee's initial year of participation in the Plan,
          Compensation will be recognized as of:

          [ ]  (1) the first day of the Plan Year.

          [X]  (2) the date the Participant enters the Plan.


                                       16
<PAGE>

8.   Distributions and Withdrawals.

     A.   Retirement Distributions.
          ------------------------

          (1)  Normal Retirement Age (Plan Section 7.1). Normal retirement age
               ----------------------------------------
               will be the later of 59 1/2 (not over age 65) or _____  (not more
                                    ------
               than 5) years of participation in the Plan.

          (2)  Early Retirement (Plan Section 7.1). Select one:
               -----------------------------------

               [X] (a) No early retirement will be permitted.

               [ ] (b) Early retirement will be permitted at age ______ .

               [ ] (c) Early retirement will be permitted at age ______
                       with at least ____ __ Years of Service.

          (3)  Annuities (Plan Section 9.3). Will your Plan permit distributions
               ---------------------------
               in the form of a life annuity? You must check Yes if this Plan
               replaces or serves as a transferee plan for an existing Plan that
               permits distributions in a life annuity form.

               [ ]  (a)  Yes      [X]  (b)  No

     B.   Hardship Distributions (Plan Section 12.2). Will your Plan permit
          hardship distributions?

          [ ]  (1)  No

          [X]  (2)  Yes. Indicate below from which Accounts hardship
                    withdrawals will be permitted (check all that apply):

               [X]  (a)  Elective Deferral Account

               [X]  (b)  Rollover Account

               [ ]  (c)  Employer Matching Account

               [ ]  (d)  Employer Contribution Account (i.e. Profit Sharing
                         Contributions)


     C.   Withdrawals after Age 59 1/2 (Plan Section 12.3). Will your Plan
          ------------------------------------------------
          permit employees over age 59 1/2 to withdraw amounts upon request? You
          must check Yes if this Plan replaces an existing Plan that permits
          withdrawals after age 59 1/2.

          [X]   (1)   Yes        [ ] (2)   No




                                       17
<PAGE>

     D.   Withdrawals following Five Years of Participation or Two Years after
          --------------------------------------------------------------------
          Contribution (Plan Section 12.4). Will your Plan permit employees to
          --------------------------------
          withdraw amounts from the vested portion of their Employer Matching
          Contribution Accounts and Employer Contribution Accounts (i.e., Profit
          Sharing Contributions) if either (i) the Participant has been a
          Participant for at least five years, or (ii) the amount withdrawn from
          each of these Accounts is limited to the amounts that were credited to
          that Account prior to the date two years before the withdrawal? You
          must check yes if this Plan replaces a Plan which permits withdrawals
          in these circumstances.

          [ ]  (1)     Yes   [X]    (2)  No


     E.   Loans (Plan Section 12.5).  Will your Plan permit loans to employees
          -------------------------
          from the vested portion of their Accounts?

          [ ]  (1)  No

          [X]  (2)  Yes. Indicate below whether loans will be permitted for any
                    reason or only on account of hardship:

               [X]  (a)  Any reason.

               [ ]  (b)  Hardship only.

     F.   Automatic Distribution of Small Accounts (Plan Section 9.1). Will your
          -----------------------------------------------------------
          Plan automatically distribute vested account balances not exceeding
          $3,500, within 60 days after the end of the Plan Year in which a
          Participant separates from employment?

          [X]   (1)   Yes        [ ] (2)   No


9.   Vesting (Plan Article 8)
     ------------------------

     A.   Time of Vesting (select (1) or (2) below and complete vesting
          -------------------------------------------------------------
          schedule).
          ---------

          [X]  (1)   Single Vesting Schedule:

               The vesting schedule selected below will apply to both Employer
               Matching Contributions and Profit Sharing Contributions.

          [ ]  (2)  Dual Vesting Schedules:

               The vesting schedule marked with an "MC" below will apply to
               Employer Matching Contributions and the vesting schedule marked
               with a "PS" below will apply to Profit Sharing Contributions.

                                       18
<PAGE>
          (3)  Vesting Schedules:

<TABLE>
<CAPTION>

          [ ]  (a)  100% vesting immediately upon participation in the Plan.

          [X]  (b)  Five-Year Graded Schedule:
<S>                                                <C>          <C>          <C>         <C>       <C>
                    Vested Percentage                   20%        40%          60%        80%       100%
                    Years of Service                    1          2            3          4         5

          [ ]  (c)  Seven-Year Graded Schedule:

                    Vested Percentage                   20%        40%          60%        80%       100%
                    Years of Service                    3          4            5          6         7

          [ ]  (d)  Six-Year Graded Schedule:

                    Vested Percentage                   20%        40%          60%        80%       100%
                    Years of Service                    2          3            4          5          6

          [ ]  (e)  Three-Year Cliff Schedule:

                    Vested Percentage                   0%         100%
                    Years of Service                    0-2        3

          [ ]  (f)  Five-Year Cliff Schedule:

                    Vested Percentage                   0%         100%
                    Years of Service                    0-4        5

          [ ]  (g)  Other Schedule (must be at least as favorable as Seven-Year Graded
                    Schedule or Five-Year Cliff Schedule):
</TABLE>

                    (i) Vested Percentage _____% _____% _____% _____% _____%

                    (ii) Years of Service ______ ______ ______ ______ ______

          (4)  Top Heavy Schedule:

               (a) If you selected above an "Other Schedule," specify in the
                   space below the schedule that will apply in Plan Years that
                   the Plan is top-heavy. The schedule you specify must be at
                   least as favorable to employees, at all years of service, as
                   either the Six-Year Graded Schedule or the Three-Year Cliff
                   Schedule. The top-heavy vesting schedule will be:

                                       19
<PAGE>

                    [ ] (i) the same "Other Schedule" selected above

                    [ ] (ii) the following schedule:

                    Vested Percentage _____% _____% _____% _____% _____%

                    Years of Service _____ _____ ______ _____ _____

                    [ ] (iii) Six-Year Graded Schedule

                    [ ] (iv) Three-Year Cliff Schedule

                 (b) If the Plan becomes top-heavy in a Plan Year, will the top-
                     heavy vesting schedule apply for all subsequent Plan Years?
                     N/A

                    [ ]    (i)      Yes      [ ]      (ii)     No

B.    Service for Vesting (select (1) or (2), and complete (3)).
      ---------------------------------------------------------

      [X] (1)  All of an employee's service will be used to determine his Years
               of Service for purposes of vesting

      [ ] (2)  An employee's Years of Service for vesting will include all years
               except (check all that apply):

          [ ]  (a) (New plan) service before the effective date of the plan

          [ ]  (b) (Existing plan) service before the effective date of the
                   existing plan

          [ ]  (c) Service before the Plan Year in which an employee reached age
                   18

          (3)  Will an employee's service for a business acquired by the
               Employer that was performed before the acquisition be included in
               determining an employee's Years of Service for vesting?

               [ ]  (a)  Yes  [X]  (b)  No

               List below any business acquired on or before the Effective Date
               for which an employee's service will be included in determining
               an employee's Years of Service for vesting. Service of an
               employee for a predecessor employer (which includes an acquired
               business) whose plan the Employer maintains must be included as
               service for the Employer under this Plan. Therefore, also list
               below any predecessor employer whose plan the Employer maintains:

                       --------

                       --------

                       --------

                                       20
<PAGE>

     C.   Hours of Service for Vesting. The number of Hours of Service required
          ----------------------------
          for crediting a Year of Service for vesting will be (check one):

          [X]  (1)  1,000 Hours of Service

          [ ]  (2)  _____ Hours of Service
                    (under 1,000)

          Hours of Service for vesting will be credited according to the method
          selected under 3.C(6).

     D.   Year of Service Measuring Period for Vesting (Plan Section 2.52). The
          ----------------------------------------------------------------
          periods of 12 months used for measuring Years of Service will be
          (check one):

          [X]    (1)  Plan Years

          [ ]    (2)  12-month Eligibility Periods

     Note: If you are adopting this Plan to replace an existing plan, employees
     will be credited under this Plan with all service credited to them under
     the plan you are replacing.

10. Investments (Plan Sections 13.2 and 13.3).
    -----------------------------------------

     A.   Available Investment Products (Plan Section 13.2). The investment
          -------------------------------------------------
          options available under the Plan are identified in the Service
          Agreement or such other written instructions between the Employer and
          Putnam, as the case may be. All Investment Products must be sponsored,
          underwritten, managed or expressly agreed to in writing by Putnam. If
          there is any amount in the Trust Fund for which no instructions or
          unclear instructions are delivered, it will be invested in the default
          option selected by the Employer in its Service Agreement with Putnam,
          or such other written instructions as the case may be, until
          instructions are received in good order, and the Employer will be
          deemed to have selected the option indicated in its Service Agreement,
          or such other written instructions as the case may be, as an available
          Investment Product for that purpose.

     B.   Instructions (Plan Section 13.3). Investment instructions for amounts
          --------------------------------
          held under the Plan generally will be given by each Participant for
          his own Accounts and delivered to Putnam as indicated in the Service
          Agreement between Putnam and the Employer. Check below only if the
          Employer will make investment decisions under the Plan with respect to
          the following contributions made to the Plan. (Check all applicable
          options.)

     C.
          [ ] (1) The Employer will make all investment decisions with respect
                  to all employee contributions, including Elective Deferrals,
                  Participant Contributions, Deductible Employee Contributions
                  and Rollover Contributions.

                                       21
<PAGE>

          [ ] (2)  The Employer will make all investment decisions with respect
                   to all Employer contributions, including Profit Sharing
                   Contributions, Employer Matching Contributions, Qualified
                   Matching Contributions and Qualified Nonelective
                   Contributions.

          [ ] (3)  The Employer will make investment decisions with respect to
                   Employer Matching Contributions and Qualified Matching
                   Contributions.

          [ ] (4)  The Employer will make investment decisions with respect to
                   Qualified Nonelective Contributions.

          [ ] (5)  The Employer will make investment decisions with respect to
                   Profit Sharing Contributions.

          [ ] (6)  Other (Describe. An Employer may elect to make investment
                   decisions with respect to a specified portion of a specific
                   type of contribution to the Plan.): ______

                   _______

                   _______


     C.   Changes. Investment instructions may be changed (check one):
          -------
          [X] (1)  on any Valuation Date (daily)

          [ ] (2)  on the first day of any month (monthly)

          [ ] (3)  on the first day of the first, fourth, seventh and tenth
                   months in a Plan Year (quarterly)

     D.   Employer Stock. (Skip this paragraph if you did not designate Employer
          --------------
          Stock as an investment under the Service Agreement.)

          (1)  Voting. Employer Stock will be voted as follows:
               ------
               [ ]  (a)  In accordance with the Employer's instructions.

               [ ]  (b)  In accordance with the Participant's instructions.
                         Participants are hereby appointed named fiduciaries for
                         the purpose of the voting of Employer Stock in
                         accordance with Plan Section 13.8.

          (2)  Tendering. Employer Stock will be tendered as follows:
               ---------
               [ ]  (a)  In accordance with the Employer's instructions.

               [ ]  (b)  In accordance with the Participant's instructions.
                         Participants are hereby appointed named fiduciaries for
                         the purpose of the tendering of Employer Stock in
                         accordance with Plan Section 13.8.

                                       22
<PAGE>

11.  Administration.
     --------------

     A.   Plan Administrator (Plan Section 15.1). You may appoint a person or a
          --------------------------------------
          committee to serve as Plan Administrator. If you do not appoint a Plan
          Administrator, the Plan provides that the Employer will be the Plan
          Administrator.

          The initial Plan Administrator will be (check one):

          [ ] This person: _____

          [X] A committee composed of these people:

               Kathryn Busa
               ------------

               Francis E. Dunne, Jr.
               ---------------------

               John L. Coughlin
               ----------------

     B.   Recordkeeper (Plan Section 15.4). Unless Putnam expressly permits
          --------------------------------
          otherwise, you must appoint Putnam as Recordkeeper to perform certain
          routine services determined upon execution of a written Service
          Agreement between Putnam and the Employer. The initial Record keeper
          will be:


          Putnam Fiduciary Trust Company
          ------------------------------
          Putnam Retail 401(k) B-2-B
          --------------------------
          859 Willard St.
          ---------------
          Quincy, MA 02269-9110
          ---------------------

12.  Determination Letter Required. You may not rely on an opinion letter issued
     -----------------------------
     to Putnam by the National Office of the Internal Revenue Service as
     evidence that the Plan is qualified under Section 401 of the Internal
     Revenue Code. In order to obtain reliance with respect to qualification of
     the Plan, you must receive a determination letter from the appropriate Key
     District Office of Internal Revenue. Putnam will prepare an application for
     such a letter upon your request at a fee agreed upon by the parties.

     Putnam will inform you of all amendments it makes to the prototype plan. If
     Putnam ever discontinues or abandons the prototype plan, Putnam will inform
     you. This Plan Agreement #001 may be used only in conjunction with Putnam's
     Basic Plan Document #07.

                                   * * * * *

     If you have any questions regarding this Plan Agreement, contact Putnam at:

                       Putnam Defined Contribution Plans
                             One Putnam Place B2B
                              859 Willard Street
                               Quincy, MA 02269
                             Phone: 1-800-752-5766

                                       23
<PAGE>

                                   * * * * *

                         EMPLOYER'S ADOPTION OF PUTNAM
                    FLEXIBLE 401(k) AND PROFIT SHARING PLAN

The Employer named below hereby adopts a PUTNAM FLEXIBLE 401(k) AND PROFIT
SHARING PLAN, and appoints Putnam Fiduciary Trust Company to serve as Trustee of
                           ------------------------------
the Plan. The Employer acknowledges that it has received copies of the current
prospectus for each Investment Product available under the Plan, and represents
that it will deliver copies of the then current prospectus for each such
Investment Product to each Participant before each occasion on which the
Participant makes an investment instruction as to his Account. The Employer
further acknowledges that the Plan will be acknowledged by Putnam as a Putnam
Flexible 401(k) and Profit Sharing Plan only upon Putnam's acceptance of this
Plan Agreement.

Investment Options
------------------

The Employer hereby elects the following as the investment options available
under the Plan:

   Putnam Money Market Fund -- A           Putnam Income Fund -- A
   -----------------------------           -----------------------
   Putnam Growth & Income Fund II -- A     Putnam International Growth Fund -- A
   -----------------------------------     -------------------------------------
   Putnam Investors Fund -- A              Putnam Vista Fund -- A
   --------------------------              ----------------------


The following investment option shall be the default option: Putnam Money Market
                                                             -------------------
Fund -- A (select the default option from among the investment options listed
---------
above).

Benthos, Inc.
Employer signature(s) to adopt Plan:                Date of signature:

 /s/ John L. Coughlin                                   5/12/99
-----------------------------                     --------------------

 /s/ Francis E. Dunne, Jr.                              5/12/99
-----------------------------                     --------------------

 /s/ Kathryn Busa                                       5/12/99
-----------------------------                     --------------------


Please print name(s) of authorized person(s) signing above:

John L. Coughlin, President & CEO
----------------------------------------
Francis E. Dunne, Jr., Treasurer
----------------------------------------
Kathryn Busa, Human Resources Manager
----------------------------------------

A new Plan must be signed by the last day of the Plan Year in which the Plan is
to be effective.

                                       24
<PAGE>

                                   * * * * *

            ACCEPTANCE OF PUTNAM FIDUCIARY TRUST COMPANY AS TRUSTEE


The Trustee accepts appointment in accordance with the terms and conditions of
the Plan, effective as of the date of execution by the Employer set forth above.

Putnam Fiduciary Trust Company, Trustee

By: /s/ James Brockelman
   ----------------------------------------------

                                       25
<PAGE>

                                   * * * * *



                              ACCEPTANCE BY PUTNAM

Putnam hereby accepts this Employer's Plan as a prototype established under
Putnam Basic Plan Document #07.

Putnam Mutual Funds Corp.

By: /s/ Paulette C. Amisano
   ----------------------------------------------

                                       26
<PAGE>

                                                    7 Shattuck Road
                                                    Andover, Massachusetts 01810
PUTNAM  INVESTMENTS

                            FIRST AMENDMENT TO THE
                     BENTHOS, INC. 401(k) RETIREMENT PLAN

 Benthos, Inc. (the "Employer") having heretofore adopted the Benthos, Inc.
 401(k) Retirement Plan, a prototype plan document consisting of the Plan
 Agreement #001 and the Putnam Basic Plan Document #07 (the "Plan") effective as
 of July 1, 1999, pursuant to the power reserved to the Employer in Section 17.1
 of the Plan, hereby amends the Plan Agreement as set forth below.

 1. Subsection D. of Section 9., of the Plan Agreement is hereby amended
    effective July 1, 1999, by striking said subsection in its entirety and by
    substituting the following new paragraph in lieu thereof:

      "D. Year of Service Measuring Period for Vesting (Plan Section 2.52). The
          ----------------------------------------------------------------
          periods of 12 months used for measuring Years of Service will be
          (check one):

          [ ]  (1)  Plan Years

          [X]  (2)  12-month Eligibility Periods

      Note:  If you are adopting this Plan to replace an existing plan,
      employees will be credited under this Plan with all service credited to
      them under the plan you are replacing."


    In all other respects, the Plan provisions remain in full force and effect.

    IN WITNESS, WHEREOF, the Employer has caused the First Amendment to the Plan
    to be duly executed in its name and behalf and its corporate seal to be
    affixed as of the date signed below.

    ATTEST:


    Benthos, Inc.                         Putnam Fiduciary Trust Company

    By: /s/ F.E. Dunne, Jr.               By: /s/ Tina Campbell
       --------------------                  --------------------

    Title: Treasurer                      Title: VP Compliance & Consulting
          --------------------                  -----------------------------

    Date: 9/28/99                         Date: 10/1/99
         --------------------                  --------------------


                            BOSTON . LONDON . TOKYO

                                       27