Exhibit 10.1

Cascade Microtech, Inc.

2007 Executive Compensation Plan

for the Six-Month Period Ending December 31, 2007

Participants

 

Eric Strid    Chief Executive Officer and President Steven Sipowicz    Chief
Financial Officer, Vice President of Finance, Treasurer and Corporate Secretary
John Pence    Vice President and General Manager, Engineering Products Division
Willis Damkroger    Vice President and General Manager, Production Products
Division

Performance Criteria

Bonuses for these participants are calculated on a percentage of their base
salary based on attainment of planned levels of net income, operating income and
divisional revenue. Determinations as to whether the performance targets have
been met are made quarterly.

This table lists the portion of the total bonus payout that is based on the
different performance measures, for each executive:

 

     Corporate and Division Metrics 80%     Individual
Metrics
20%        Net
income     Operating
income     Engineering
products
revenue     Production
products
revenue     Quarterly
Objectives  

Chief Executive Officer

   30 %   30 %   10 %   10 %   20 %

Chief Financial Officer

   30 %   30 %   10 %   10 %   20 %

VP Engineering Products

   —       60 %   20 %   —       20 %

VP Production Products

   —       60 %   —       20 %   20 %

The payout for the operating income and net income portion will be:

 

•  

100% payout for achievement of 100% of the planned consolidated operating income
and net income (“target”)

 

•  

Linear for operating income and net income beginning at minimum dollar level to
100% payout at 100% of target to 200% payout cap at maximum dollar level and
higher

 

•  

Zero for operating income and net income below minimum dollar level

The payout for the product line revenue portion will be:

 

•  

100% payout for achievement of 100% of the planned respective consolidated
product line revenue (“target”)

 

•  

Linear from 0% payout for product line revenues at 50% of target to 200% payout
cap at 150% of target and higher

 

•  

Zero for product line revenues below 50% of target

The payout for objectives will be proportional to the fraction of objectives
completed. The CEO is the final arbiter of such completion status. A set of
objectives is formulated by a consensus of the management team for each
executive at the beginning of each quarter.