EXHIBIT 10.7

MERCURY COMPUTER SYSTEMS, INC.

ANNUAL EXECUTIVE BONUS PLAN—INDIVIDUAL PERFORMANCE

SECTION 1

BACKGROUND, PURPOSE, AND DURATION

1.1 Effective Date . The Plan is effective as of July 28, 2009.

1.2 Purpose of the Plan . The Plan is intended to increase shareholder value and the success of the Company by motivating Participants to (a) perform to the best of their abilities, and (b) achieve the Company’s objectives. The Plan’s goals are to be achieved by providing Participants with the opportunity to earn incentive bonuses for the achievement of “management by results” individual performance goals.

1.3 Documents Constituting the Company’s Annual Executive Bonus Plan . There are two separate components of the Company’s Annual Executive Bonus Plan: (i) this Plan, and (ii) the Company’s plan titled “Annual Executive Bonus Plan—Corporate Financial Performance.”

SECTION 2

DEFINITIONS

The following words and phrases shall have the following meanings unless a different meaning is plainly required by the context:

“ Actual Bonus ” means, as to any Performance Period, the actual annual bonus (if any) payable to a Participant for the Performance Period pursuant to Section 4.3.

“ Affiliate ” means any corporation or other entity controlled by the Company.

“ Board ” means the Board of Directors of the Company.

“ Cause ” means (a) the willful and continued failure by the Participant (other than any such failure resulting from (i) the Participant’s incapacity due to physical or mental illness, (ii) any such actual or anticipated failure after the issuance of a notice of termination by the Participant for Good Reason, or (iii) the Company’s active or passive obstruction of the performance of the Participant’s duties and responsibilities) to perform substantially the duties and responsibilities of the Participant’s position with the Company after a written demand for substantial performance is delivered to the Participant by the Board, which demand specifically identifies the manner in which the Board believes that the Participant has not substantially performed such duties or responsibilities, (b) the conviction of the Participant by a court of competent jurisdiction for felony criminal conduct or a plea of nolo contendere to a felony, or (c) the willful engaging by the Participant in fraud, dishonesty or other misconduct which is demonstrably and materially injurious to the Company or its reputation, monetarily or otherwise. No act, or failure to act, on the Participant’s part shall be deemed “willful” unless committed or omitted by the Participant in bad faith and without a reasonable belief that the Participant’s act or failure to act was in, or not opposed to, the best interest of the Company.

“ Code ” means the Internal Revenue Code of 1986, as amended. Reference to a specific section of the Code or regulation thereunder shall include such section or regulation, any valid regulation promulgated thereunder, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation.

“ Committee ” means the Compensation Committee of the Board or any successor committee to the Compensation Committee.

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“ Company ” means Mercury Computer Systems, Inc., a Massachusetts corporation, or any successor thereto.

“ Disability ” means total and permanent disability as defined in section 22(e)(3) of the Code, provided that the Committee, in its sole discretion, may determine whether a permanent and total disability exists in accordance with uniform and non-discriminatory standards adopted by the Company from time to time.

“ Employee ” means any employee of the Company or an Affiliate, whether such employee is so employed at the time that the Plan is adopted or becomes so employed subsequent to the adoption of the Plan.

“ Fiscal Year ” means the fiscal year of the Company.

“ Good Reason ” for termination by the Participant of the Participant’s employment means the Participant has complied with the Good Reason Process following the occurrence (without the Participant’s express written consent) of any one of the following events:

a. a material adverse change in the Participant’s status or position with the Company, including without limitation any adverse change in the Participant’s status or position as a result of a material diminution of the Participant’s duties or responsibilities, or the assignment to the Participant of any duties or responsibilities which are inconsistent with such status or position, or any removal of the Participant from, or any failure to reappoint or reelect the Participant to, such position;

b. a material reduction in the Participant’s base salary; or

c. the Company requiring the Participant to be based at an office that is greater than fifty (50) miles from where the Participant’s office is currently located, except for required travel on the Company’s business to an extent substantially consistent with the business travel obligations that the Participant undertook on behalf of the Company prior to such change in office location.

If the Participant has a change-in-control agreement with the Company, Good Reason shall have the meaning assigned to such term in the change-in-control agreement.

“ Good Reason Process ” shall mean that (a) the Participant reasonably determines in good faith that a “Good Reason” event has occurred; (b) the Participant notifies the Company in writing of the first occurrence of the Good Rea