Document:

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                                                                   Exhibit 10.13

CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

                                LICENSE AGREEMENT

         This Agreement is entered into as of July 21,1999 (the "Effective
Date") between CASCADE MICROTECH, INC., an Oregon corporation ("CASCADE"), and
ELECTROGLAS, INC., a Delaware corporation ("ELECTROGLAS"), and is as follows:

                                    RECITALS

         A. CASCADE and ELECTROGLAS have entered into a Joint Development
Agreement as of June 18, 1999 (the "Joint Development Agreement"), pursuant to
which CASCADE has incorporated certain of its technology into ELECTROGLAS
fully-automatic probers used in production processes by semiconductor
fabrication plants, so as to enhance the performance of such probers in the
parametric testing of wafers.

         B. This Agreement constitutes a portion of the parties' performance
under the terms of the Joint Development Agreement.

         Accordingly, the parties agree as follows:

                                 1. DEFINITIONS

         In this Agreement, unless the context otherwise requires, the following
terms shall have the following meanings:

         1.1 "Licensed Technology"

                                      -1-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

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         "Licensed Technology" means CASCADE's low leakage, low noise parametric
probing technology related to "Licensed Technology" means CASCADE's low leakage,
low noise parametric probing technology related to chucks, cabling, and
shielding more particularly set forth in Exhibit A to the Joint Development
Agreement and including: (1) all related patented technology, process
techniques, and know how developed by CASCADE prior to and throughout the term
of the Joint Development Agreement; and (2) all related non patentable
modifications, adjustments or enhancements that CASCADE makes, during the term
of this Agreement to either purchased components or the Licensed Technology. The
Licensed Technology excludes technology related to probes and probe cards.

         1.2 "Licensed Trademarks"

         "Licensed Trademarks" means the trademarks FEMTOGUARD, ATTOGUARD,
MICROCHAMBER and INNER GROUND PLANE.

         1.3 "Fully-Automatic Prober"

         "Fully-Automatic Prober" means a prober having an automatic wafer
loader, automatic pad to probe alignment system, and probe card ring carrier,
and having no microscope, microscope mount,.or individual probe positioners.

         1.4 "Production Market"

         "Production Market" means the market for probers which are used to test
wafers having devices intended for sale in the ordinary course of business, for
production use.

         1.5 "Process Integration Market"

         "Process Integration Market" means the market for probers usually used
to test wafers for the purpose of process development or improvement.

         1.6 "Engineering Laboratory Market"

                                      -2-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

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         "Engineering Laboratory Market" means the market for probers which are
usually used to test wafers for the purpose of product or process design or
development, not for production use.

         1.7 "Parametric Prober"

         "Parametric Prober" means any Fully-Automatic Prober which incorporates
any of the Licensed Technology, including without limitation any current and
future generations of such probers for testing 200 mm or 300 mm wafers.

         1.8 "Field of Use"

         "Field of Use" means the Production Market and Process Integration
Market, but excludes the Engineering Laboratory Market.

                                   2. LICENSE

         CASCADE grants to ELECTROGLAS a worldwide license to use the Licensed
Technology and Licensed Trademarks to enable ELECTROGLAS to manufacture, market,
and sell any Parametric Prober within the Field of Use. ELECTROGLAS shall not
sublicense the rights granted herein, and shall not use the Licensed Technology
or Licensed Trademarks other than as permitted by this Agreement. An exception
to the foregoing right to manufacture shall be with respect to any upper guard
structure in any Parametric Prober manufactured or marketed in Japan. CASCADE
shall sell any such upper guard structure to ELECTROGLAS at cost (not including
the royalty payable to the Japanese licensor) for incorporation into any
Parametric Prober manufactured or marketed in Japan during the term of this
Agreement.

                           3. PAYMENTS BY ELECTROGLAS

         In return for the rights granted in Section 2 hereof, ELECTROGLAS shall
make the following payments to CASCADE:

                                      -3-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

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         3.1 Concurrently with the execution of this Agreement, a license fee
payment in the amount of One Million Five Hundred Thousand Dollars
($1,500,000);

         3.2 Within ten (10) days after both parties have received the notice
required by Section 3.1 of the Joint Development Agreement with respect to
Parametric Prober Two described therein, an additional license fee payment of
Five Hundred Thousand Dollars ($500,000);

         3.3 In addition, throughout the term of this Agreement, royalty
payments based on each sale or lease by ELECTROGLAS of any Parametric Prober to
a party other than CASCADE, as follows:

         (a) [**] Dollars($[**]) for each 200 mm Parametric Prober sold or
leased on or before July 31, 2007, and [**] Dollars ($[**]) for each 200 mm
Parametric Prober sold or leased thereafter;

         (b) [**] Dollars($[**]) for each larger-than-200 mm Parametric
Prober sold or leased on or before July 31, 2011, and [**] Dollars($[**]) for
each larger-than-200 mm Parametric Prober sold or leased thereafter;

         (c) For any Parametric Prober not covered by at least one valid
claim of a patent included within the Licensed Technology, the royalty
payments in Sections 3.3(a) and 3.3(b) will be reduced by [**] Percent ([**]%);
a claim of any patent within the Licensed Technology shall be deemed to
be invalid from the time that there shall be a final judgment of a Federal
Court from which no appeal is, or can be, timely taken holding such claim
invalid;

         (d) Sections 3.3(a) and 3.3(b) shall be subject to a downward
adjustment in the event that CASCADE imposes changes in the Licensed Technology
which reduce the performance of future Parametric Probers to the extent agreed
to by the parties pursuant to Section 1.4 of the Joint Development Agreement;

                                      -4-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

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         (e) It is not intended that any royalty will be payable on equipment
provided for demonstration purposes in a manner consistent with accepted
practice in the industry. A royalty will be payable on former demonstration
equipment that is subsequently sold or leased other than for demonstration
purposes.

                          4. PAYMENT DATES AND REPORTS

         Reports shall be made by ELECTROGLAS to CASCADE quarterly within thirty
(30) days after the first days of January, April, July, and October of each
calendar year, specifying the numbers of Parametric Probers, by model, which are
subject to the royalty payments required by Section 3.3 for the preceding
three-month period. Each report shall be accompanied by a payment for the amount
due CASCADE under Section 3.3 for the three-month period covered by the report.
ELECTROGLAS agrees to keep full, accurate and complete records pertaining to the
sale, lease, or other disposition of each Parametric Prober, and to permit
CASCADE or its duly-authorized agent to inspect such records during ordinary
business hours on ten (10) days' notice.

                                 5. EXCLUSIVITY

         5.1 The rights granted to ELECTROGLAS in Section 2 with respect to the
Licensed Technology shall be exclusive, with respect to the Production Market
only, for an initial [**]([**]) year period after the Effective Date of this
Agreement. Thereafter, in order for ELECTROGLAS to retain such exclusivity,
ELECTROGLAS must have made minimum royalty payments under Section 3.3 to CASCADE
as follows:

<TABLE>
<CAPTION>

[**] ([**]) YEAR PERIOD               MINIMUM ROYALTY PAYMENTS
FOLLOWING EFFECTIVE DATE          FOR EACH [**] ([**]) YEAR PERIOD
------------------------          -----------------------------

<S>                               <C>
[**] and [**]                         $   [**]
[**] and [**]                         $   [**]
[**] and [**]                         $   [**]

</TABLE>

                                      -5-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

Each [**] ([**]) year period thereafter                              $[**]

         In the event ELECTROGLAS has failed to pay CASCADE at least the
foregoing minimum royalty payments within thirty (30) days after the end of
any applicable [**] ([**]) year period, then CASCADE shall have the right,
but not the obligation, to make all of the rights granted to ELECTROGLAS in
Section 2 nonexclusive by giving ELECTROGLAS written notice of CASCADE's
intention to do so. Provided, however, that if within 30 days of
such written notice ELECTROGLAS at its option pays CASCADE, the deficit
between the total royalty payments actually paid for the applicable [**] ([**])
year period and the foregoing minimum royalty payments for such [**] year
period, then such notice shall be ineffective. Any royalty payments actually
paid in excess of the minimum royalty payments, for the [**] ([**]) year
period immediately preceding the [**] ([**]) year period for which such a
deficit occurs, shall be credited against such deficit.

         5.2 The exclusivity defined in Section 5.1 shall continue without any
requirement for minimum royalty payments after such time as CASCADE has received
license fees and royalty payments under Sections 3.1, 3.2 and 3.3 totaling
[**] Dollars ($[**]).

         5.3 Section 5.1 shall be subject to a downward adjustment in the event
that CASCADE imposes changes in the Licensed Technology which reduce the
performance of future Parametric Probers to the extent agreed to by the parties
pursuant to Section 1.4 of the Joint Development Agreement.

                    6. RIGHTS WITH RESPECT TO NEW TECHNOLOGY
                       NOT WITHIN THE LICENSED TECHNOLOGY

                                      -6-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

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         With respect to technology of CASCADE not within the Licensed
Technology, ELECTROGLAS shall have the right to obtain from CASCADE a
nonexclusive license, to manufacture, market, and sell Fully-Automatic Probers
within the Field of Use, using patentable low noise, low leakage technology
applicable to chucks, cabling, and shielding (but not to probes or probe cards)
if CASCADE licenses such technology to a third party. The terms and conditions
of such license shall otherwise be at least as favorable to ELECTROGLAS as
CASCADE provides in such license of the same technology to such third party.

                             7. SALES AND MARKETING

         The parties shall use their reasonable best efforts to present a
nonthermal version of the Parametric Prober at Semicon West, 1999, and shall
work together in developing a marketing strategy. ELECTROGLAS intends to market
the Parametric Prober within the Field of Use, while CASCADE intends to market
and sell non-full-featured versions of the Parametric Prober in the Engineering
Laboratory Market and the Process Integration Market. The parties shall meet
semiannually to review sales and marketing information including, but not
limited to, unit sales, selling price of the competition, marketing strategy,
and the need for product improvement or new technology.

                            8. PRODUCTION AND SERVICE

         ELECTROGLAS will build, service, and provide spare parts for the
Parametric Prober. After the first ten (10) installed units, ELECTROGLAS shall
assume primary responsibility for application support with respect to
installations. CASCADE and ELECTROGLAS will jointly ensure that ELECTROGLAS
application engineers have adequate training to provide first-tier application
support with respect to installations; for CASCADE, such training shall be
limited to three (3) man

                                      -7-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

months per year during the first three (3) years of this Agreement. CASCADE
shall also provide one (1) man month of application support to Electroglas for
the first two (2) years of this Agreement, during which time ELECTROGLAS shall
pay for travel expenses for CASCADE personnel providing such application,
support. Thereafter, CASCADE shall provide application support to Electroglas at
its normal billable rate and under the same terms and conditions as CASCADE
provides with other products for such services. ELECTROGLAS shall provide goods
and services to its customers under the same terms and conditions as ELECTROGLAS
provides with other products. Each party will market ELECTROGLAS service
contracts with their respective versions of the Parametric Prober.

                               9. QUALITY CONTROL

ELECTROGLAS expressly recognizes the importance to CASCADE, to customers, and to
potential customers, of maintaining high, uniformly-applied standards with
respect to the nature and quality of Parametric Probers which utilize the
Licensed Trademarks, and their packaging, advertising and promotional materials.
ELECTROGLAS agrees that the quality of Parametric Probers utilizing the Licensed
Trademarks hereunder, and their packaging, advertising and promotional
materials, shall be at least as high as that of the probers currently sold by
ELECTROGLAS. ELECTROGLAS will cooperate with CASCADE in making any changes
necessary to maintain such quality. ELECTROGLAS further agrees that it shall
produce, package and sell such Parametric Probers in compliance with all
applicable laws and government regulations and good manufacturing practices
prevailing in the industry.

                          10. PROSECUTION OF INFRINGERS

                                      -8-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

         For the duration of the exclusive rights described in Section 5,
ELECTROGLAS, at its sole discretion and expense and for its sole benefit, shall
have the right to prosecute infringement within the Field of Use of any patent
within the Licensed Technology which is incorporated in an ELECTROGLAS
Parametric Prober. ELECTROGLAS shall have the right to join CASCADE as a
complainant in such suit, but shall indemnify CASCADE against liability by
reason of such joinder. If ELECTROGLAS does not prosecute any such infringement
for six (6) months after written notice given by CASCADE, then CASCADE may
thereafter prosecute such infringement at its own expense and for its own
'benefit to the exclusion of ELECTROGLAS. ELECTROGLAS may be joined as a
complainant in such latter suit but shall be indemnified by CASCADE against
liability by reason of such joinder. Each party hereby irrevocably consents to
being joined as a complainant pursuant to this Section.

                              11. TERM OF AGREEMENT

         11.1 Unless sooner terminated under Section 12, the term of this
Agreement shall begin on the Effective Date, and shall expire at the earlier of:

         (a) The expiration of all CASCADE patents within the Licensed
         Technology;

         (b) On [**]; or

         (c) At such time as CASCADE has received license fees and royalty
payments under Sections 3.1, 3.2 and 3.3 totaling [**] Dollars($[**]).

         11. 2 If this Agreement expires pursuant to Section 11. 1, the rights
granted in Section 2 shall survive such expiration, subject to Section 9, with
no further requirement for royalty payments under this Agreement. Moreover, if
this Agreement expires pursuant to Section 11. 1 (c), the rights granted

                                      -9-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

in Sections 5.2 and 10 with respect to exclusivity shall likewise survive such
expiration with no further requirement for royalty payments under this
Agreement.

                            12. TERMINATION FOR CAUSE

         In the event ELECTROGLAS shall fail promptly to make any payment
provided for in this Agreement when the same becomes due, then CASCADE may at
any time thereafter, while such default or condition continues, at its option
terminate this Agreement by giving ELECTROGLAS at least thirty (30) days'
written notice of such termination, stating with particularity in such notice
the default or condition alleged to have occurred; provided that such
termination shall not become effective if, within such thirty (30) day period of
notice, ELECTROGLAS shall correct such default or condition. Time is of the
essence of this Agreement. Upon the termination of this Agreement for cause
pursuant to this section, ELECTROGLAS shall not thereafter use the Licensed
Technology or Licensed Trademarks, except that upon any such termination
ELECTROGLAS shall have the right to complete the manufacture of any Parametric
Prober which is in the course of manufacture at the time of ELECTROGLAS' receipt
of notice of termination atid to sell or permit the sale of such Parametric
Prober so completed or held in stock by it'at the time such notice is received,
subject to the payments and the observance of the other conditions specified in
this Agreement. No termination of this Agreement for any reason shall relieve
the parties from any payment, report, records inspection or other obligation
with respect to any period prior to the effective date of such termination.

                          13. CONFIDENTIAL INFORMATION

         The provisions of Section 4 of the Joint Development Agreement are
hereby incorporated by reference.

                                      -10-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

                              14. WARRANTY OF TITLE

         CASCADE warrants and represents to ELECTROGLAS that CASCADE is the sole
and exclusive owner of all proprietary rights included in the Licensed
Technology, and has not entered into any agreement or understanding with any
other party in conflict herewith.

                                  15. SURVIVAL

         The provisions of Sections 1, 2, 5, 9, 10, 11, 12, 14, and 18 shall
survive the expiration or termination of this Agreement to the extent necessary
to satisfy the conditions of Sections 5, 11 and 12. The provisions of Sections
13 and 17 shall survive the expiration or termination of this Agreement for any
reason.

                                16. ASSIGNABILITY

         Each parties' right under this Agreement shall generally be assignable
together with its business relating to the Licensed Technology, provided that
the assignee accepts all obligations owed to the nonassigning party. Assignment
shall not be permitted to a direct competitor of ELECTROGLAS within the
Production Market, or to an affiliate of such direct competitor. In addition,
any material breach of this Agreement by the assignee, which remains uncorrected
after thirty (30) days' written notice by ELECTROGLAS specifying such breach,
shall result in ELECTROGLAS receiving a fully paid-up nonexclusive license from
the date of such breach. Otherwise, no assignment of the respective rights of
the parties under this Agreement is permitted without the written consent of the
other party.

                                17. MISCELLANEOUS

         The provisions of Section 7 of the Joint Development Agreement are
hereby incorporated by reference.

                                      -11-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

                        18. PATENT AND TRADEMARK NOTICES

         18. 1. Each party agrees, to the extent practical, to properly affix a
statutory patent notice to all of its products covered by any patent licensed
pursuant to this Agreement. CASCADE will supply ELECTROGLAS with written
identifications of the products that should bear such notices, reasonable
instructions for affixing the notices, and copies of the notices desired to be
affixed.

         18.2. All uses of any of the Licensed Trademarks by ELECTROGLAS shall
include any notice designations legally required or useful for enforcement of
the rights in the mark, as requested from time-to-time by CASCADE upon
reasonable notice to ELECTROGLAS. In addition, any product, advertising, product
literature or product documentation using any of the Licensed Trademarks shall
include a notice naming any such mark or marks so used and indicating that such
marks are trademarks of CASCADE.

         IN WITNESS WHEREOF, the undersigned have executed this License
Agreement as of the Effective Date first referenced above.

"ELECTROGLAS"                                  "CASCADE"

ELECTROGLAS, INC.,                             CASCADE MICROTECH, INC.,
a Delaware corporation                         an Oregon corporation

By    /s/ CURT WOZNIAK                      By   /s/ ERIC W. STRID
  --------------------------------------       ------------------------
    Curt Wozniak,                              Eric W. Strid,
    Chief Executive Officer                    Chief Executive Officer

                                      -12-

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.<PAGE>

                                                                  Exhibit 10.14

CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

                            PATENT LICENSE AGREEMENT

                                     between

                           Micronics Japan Co., Ltd.;

                           Hewlett-Packard Japan Ltd.;

                                       and

                          Cascade Microtech Japan, Inc.

<PAGE>

                                Table of Contents

1.       DEFINITIONS...........................................................3

         1.1      "LICENSED PATENTS"................................3
         1.2      "LICENSED PRODUCTS"...............................3
         1.3      "AFFILIATE".......................................3

2.       GRANT OF LICENSE......................................................3

3.       PAYMENT AND REPORTS...................................................4

         3.3a     MINIMUM ROYALTIES.................................4
         3.3b     ADDRESSES FOR PAYMENTS AND REPORTS................5

4.       WARRANTY AND DISCLAIMER...............................................5

5.       TERM AND TERMINATION..................................................6

6.       GENERAL...............................................................6

<PAGE>

                                    AGREEMENT

         This Agreement is made by and between MICRONICS JAPAN CO., LTD., a
corporation of Japan having a principal place of business at 2-6-8 Hon-Cho,
Kichijoji, Musashino-Shi, Tokyo, Japan ("MJC"); HEWLETT-PACKARD JAPAN, LTD., a
corporation of Japan having a principal place of business at 9-1, Takakura-Co,
Hachioji-Shi, Tokyo, Japan ("HPJ"); and CASCADE MIROTECH JAPAN, INC., a
corporation of Japan having a principal place of business at Sumitomo Aobadai
Hills, 4-7-7 Aobadai, Megura-Ku, Tokyo, Japan ("CMJ").

         This Agreement shall become effective as of the date (hereinafter the
"EFFECTIVE DATE") it has been signed by all parties.

         WHEREAS, MJC AND HPJ jointly own or control, and have the rights to
license certain patent applications relating to electric circuit measurement
apparatuses; and both of MJC and HPJ desire to grant and CMJ desires to accept a
non-exclusive license under those rights;

         THEREFORE, the parties agree as follows:

1.       DEFINITIONS

1.1      "LICENSED PATENTS" means a pending patent application Tokugan Hei
5-177572 (Tokkai Hei 7-84003) filed with Japanese Patent Office on June 25, 1993
and all divisions and conversions thereof, which are all unexpired and not
finally rejected or finally held invalid by the Japanese Patent Office or a
court of final jurisdiction.

1.2      "LICENSED PRODUCTS" means CMJ's products in the field of electric
circuit measurement apparatuses such as parametric probing systems manufactured
or used or sold in Japan which manufacture or use or sale is covered by one or
more claims of a LICENSED PATENT issued or pending in Japan, provided that any
such pending LICENSED PATENT must ultimately be granted with one or more issued
claims covering such manufacture, use or sale.

1.3      "AFFILIATE" means any entity which controls CMJ, which is controlled by
CMJ, or which is controlled by an entity which controls CMJ.

2.       GRANT OF LICENSE

2.1      MJC and HPJ hereby grant to CMJ and its AFFILIATEs a non-exclusive
worldwide license, without the right to sublicense, under the LICENSED PATENTS
to make, have made, use, lease, sell or otherwise transfer the LICENSED
PRODUCTS. No license is granted by MJC and HPJ under this Agreement, either
directly or by implication, under any patent other than the LICENSED PATENTS.

2.2      The license granted in Section 2 of this Agreement shall take effect on
the EFFECTIVE DATE of this Agreement.

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

3.       PAYMENT AND REPORTS

3.1      As consideration for the license granted in this Agreement, CMJ
shall pay, to MJC [**] Japanese yen ((Y)[**]) per each LICENSED PRODUCT sold,
leased or otherwise disposed of by CMJ or its AFFILIATEs, and to HPJ [**]
Japanese yen ((Y)[**]) per each LICENSED PRODUCT sold, leased or otherwise
disposed of by CMJ or its AFFILIATEs, as of and subsequent to December 15,
1995. Such payment shall be made as set forth in paragraphs 3.1a, 3.2, 3.2a,
3.3 and 3.3a.

3.1a     Only one royalty shall be payable with respect to any LICENSED PRODUCT
which may be subject to royalty by utilization of more than one LICENSED PATENT.

3.2      In consideration of the payments made as provided for bellow, and
effective as of the date of receipt by both of MJC and HPJ of such payments, MJC
and HPJ will release CMJ, its AFFILIATEs, and all purchasers and users of
LICENSED PRODUCTS from all claims or liability for past infringement of the
LICENSED PATENTS, from the dates specified in Paragraphs 3.2a. No royalty shall
be due on products which are not LICENSED PRODUCTS as this term is defined in
Paragraph 1.2, above.

3.2a     Within sixty (60) days after the date a patent is granted in Japan to
MJC and HPJ upon the pending application of MJC and HPJ by the Japanese Patent
Office as identified in Paragraph 1.1, CMJ shall pay to MJC and HPJ royalties
computed in accordance with the provision of Paragraphs 3.1 and 3.1a, above,
without interest, for all manufacture and sales of LICENSED PRODUCTS in Japan
during the period from December 15, 1995 to the date such patent aforesaid is
granted.

3.3      For royalties accrued after the date a patent is granted in Japan to
MJC and HPJ upon the pending application of MJC and IIPJ as identified in
Paragraph 1.1, a Payment Period will be each half fiscal year of CMJ (one being
January 1st through June 30th and the other being July 1st through December
31st) during the term of this Agreement. Each payment shall be preceded by a
report from CMJ to MJC and HPJ setting forth the bases of the computation of
royalties and the amounts payable.

         CMJ shall be liable for interest on any overdue payment at a rate of
10% per year.

3.3a     MINIMUM ROYALTIES

         Should royalties in Paragraph 3.3 accrued during a fiscal year,
computed in accordance with the provision of Paragraph 3.1. be zero, CMJ
shall pay to MJC [**] Japanese yen ((Y)[**]) for the fiscal year within sixty
(60) days after the last day of the fiscal year.

3.4      ADDRESSES FOR PAYMENTS AND REPORTS

3.4a     Payments and reports to MJC will be forwarded directly to the
following address:

         Micronics Japan Co., Ltd.

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

         General Affairs Department
         2-6-8, Kichijoji Hon-Cho, Musashino-Shi,
         Tokyo, 180 Japan

3.4b     Payments and reports to HPJ will be forwarded directly to the following
address:

         HEWLETT-PACKARD JAPAN, LTD.,
         Hachioji Semiconductor Test Division
         c/o Tadanori Furutsuki
         9-1, Takakura-Cho, Hachioji-Shi
         Tokyo, 192 Japan

3.5      CMJ shall keep adequate records to accurately determine the payments
due under this Agreement. Once each calendar year and upon reasonable advance
written notice to CMJ, MJC and HPJ may have an independent auditor audit the
applicable records of CMJ, at expense on both of MJC and CMJ, to verify the
accuracy of the royalty calculations. All such records shall be treated as
Confidential Information by said independent auditor and shall not be disclosed
to MJC and HPJ except insofar as necessary to verify to MJC and HPJ the accuracy
of CMJ's payments to MJC and HPJ. Should any payment be underpaid by at least
10%, then the CMJ shall pay the reasonable expense of such audit. Any
underpayment or overpayment shall be included or credited with the next payment
under this Agreement.

3.6      Any sum of money paid by CMJ hereunder shall not be refunded for any
reason, whatsoever, except as otherwise provided hereunder or where both parties
agree that an overpayment occurred through mistake.

3.6a     Should any LICENSED PATENT be finally rejected or finally held invalid
by the Japanese Patent Office or the court of final jurisdiction, MJC and HPJ
shall refund to CMJ any sum of royalties paid for sales of LICENSED PRODUCT
subsequent to such final holding where such sum was paid solely by reason of
said LICENSED PATENT.

4.       WARRANTY AND DISCLAIMER

4.1      MJC and HPJ warrant that they have the right to grant the license set
forth in Section 2 hereof. MJC and HPJ make no other representations or
warranties, express or implied, nor do MJC and HPJ assume any liability in
respect to any infringement of patents or other rights of third parties due to
CMJ's operation under the license granted herein, nor do MJC and HPJ assume any
responsibility for enforcement of the LICENSED PATENTS against third parties.

5.       TERM AND TERMINATION

5.1      Unless sooner terminated as hereinafter provided, the term of this
Agreement shall be from the EFFECTIVE DATE hereof until the expiration date of
the last to expire of the LICENSED PATENTS.

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

5.2a     MJC and HPJ may forthwith terminate this Agreement by written notice of
termination to CMJ, in the event that CMJ becomes insolvent, or voluntarily or
otherwise enters into liquidation or bankruptcy, or has a receiver or trustee
appointed to administer its property or affairs.

5.2b     If CMJ should, at anytime, fail to pay any fee or royalty or breach any
material provision of this Agreement and such failure should not be cured within
sixty (60) days after written notice from MJC and HPJ to CMJ specifying the
nature of the default, MJC and HPJ shall have the right to terminate this
Agreement by giving written notice to CMJ, and upon the giving of such notice,
such license shall terminate forthwith.

5.3      Any termination pursuant to this Section shall not relieve CMJ of any
obligation or liability accrued hereunder prior to such termination, and such
termination shall not affect in any manner any rights of any of MJC and HPJ
under this Agreement, or rescind or give rise to any right to rescind anything
done by CMJ or any payments made or other consideration given to MJC or HPJ
hereunder prior to the time such termination becomes effective.

5.4      In the event of termination of this Agreement, all rights and
obligations which by their nature survive the expiration or termination of this
Agreement shall remain in effect, including specifically the confidentiality
provisions contained in Paragraph 6.9 and the warranty provisions contained in
Section 4.

6.       GENERAL

6.1      This Agreement constitutes the entire agreement between the parties
relating to the subject matter of this Agreement, and supersede all prior
proposals, agreements, representations and other communications between the
parties with respect to the subject matter of this Agreement.

6.2      No change in the provisions of this Agreement shall be valid unless in
writing and signed by all parties.

6.3      The laws of Japan shall be employed for construction and interpretation
of this Agreement and determination of the legal relations between the parties
hereunder.

6.4      With regard to any dispute arising out of this Agreement, the parties
shall first attempt to settle the same by means of amicable, sensible and
generally reasonable discussions and/or negotiation held between the parties.

6.5      Neither party may assign this Agreement to any party at any time
without written consent of the other, except that this Agreement may be assigned
by either party to any person, corporation or other business entity succeeding
to such party's entire business in the LICENSED PRODUCTS, provided such assignee
shall, without delay, accept in writing the provisions of this Agreement and
agree to become in all respects bound thereby.

6.6      The failure or delay of either party in exercising any of its rights
hereunder, including any rights with respect to a breach or default by the other
party, shall in no way operate as a waiver of

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

such rights or prevent the assertion of such rights with respect to any
later breach or default by the other party.

6.7      Should any provision of this Agreement be held to be unenforceable,
such ruling shall not affect the validity and enforceability of the remaining
provisions of this Agreement.

6.8      Any notice or acceptance provided for in this Agreement shall be in
writing and shall be deemed to have been given on the date such communication is
deposited in certified or registered first class mail, in an appropriately
stamped envelope, addressed:

         To MJC:           Micronics Japan Co., Ltd.
                           Research and Development Center
                           Development Control Section
                           MHC Bldg.
                           8-7-3, Shimorenjaku, Mitaka-Shi,
                           Tokyo, 181 Japan
                           Phone:  +81-422-45-0710

         To HPJ:           Hewlett-Packard Japan, Ltd.
                           Hachioji Semiconductor Test Division
                           9-1, Takakura-Cho, Hachioji-Shi
                           Tokyo, 192 Japan
                           Attention:  Kenzo Ishiguro
                           Phone:  +81-426-60-2158

         To CMJ:           Cascade Microtech Japan, Inc.
                           Sumitomo Aobadai Hills Bldg.
                           7-7 Aobadai 4-chome, Meguro-ku,
                           Tokyo, 163 Japan
                           Attention:  Naoya Koiso
                           Phone:  +81-3-5478-6100

6.9      The parties agree that the terms of this Agreement are confidential and
each party shall use the same degree of care to prevent disclosure of the terms
of this Agreement to third parties as it uses to protect its own confidential
information of similar nature. Any advertising or publicity concerning this
Agreement, including press releases, which mentions the other party by name
shall be agreed upon by both parties in writing prior to any release,
notwithstanding the foregoing, either party may disclose the terms of this
Agreement to a bona fide prospective successor to such party's entire business
in the LICENSED PRODUCTS.

6.10     The headings used in this Agreement are for reference and convenience
only and shall not be used in interpreting the provisions of this Agreement.

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

<PAGE>

6.11     Nothing contained in this Agreement shall be deemed to grant, either
directly or by implication, estoppel, or otherwise, any license under patents or
other intellectual property rights other than as specifically provided in
Section 2 of this Agreement.

IN WITNESS WHEREOF, this Agreement is hereby executed by a duly authorized
representative of each party.

     MICRONICS JAPAN CO., LTD.                 HEWLETT-PACKARD JAPAN, LTD.

By   /S/ Yoshiei Hasegawa            By    /S/ Minoru Ebihara
     --------------------------         ----------------------------------------
         Yoshiei Hasegawa                         Minoru Ebihara
         ----------------------               ----------------------------------
         Typed Name                               Typed Name

                                                  General Manager
         President                      Hachioiji Semiconductor Test Division
         ----------------------               ----------------------------------
         Title                                    Title

         July 28, 1997                            July 23, 1997
         ----------------------               ----------------------------------
         Date                                     Date

     CASCADE MICROTECH JAPAN, INC.

By   /S/ Naova Koiso
   ---------------------------
         Naova Koiso
         -----------------------
         Typed Name

         General Manager
         -----------------------
         Title

         July 14, 1997
         ----------------------
         Date

[**] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION.  CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT
TO THE OMITTED PORTIONS.

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