EXHIBIT 10.26
                                      LEASE



DATED:    April 10, 1998

BETWEEN:  PACIFIC REALTY ASSOCIATES, L.P.,
          a Delaware limited partnership, hereinafter referred to as "LANDLORD"

AND:      CREDENCE SYSTEMS CORPORATION,
          a California corporation, hereinafter referred to as         "TENANT"


     Tenant  wishes to lease from  Landlord the  following  described  property,
hereinafter referred to as "the Premises":

     A total of approximately  183,315 square feet of warehouse and office space
comprised of approximately 71,265 square feet of office space located in a three
(3) story office building ("Space One") and approximately 112,050 square feet of
warehouse and  manufacturing  space  located in two (2)  connected  single story
buildings  ("Space Two")  located at Five Oaks West Business  Park, on Pine Farm
Road in Hillsboro, Oregon (and generally as located on the attached Exhibit A.)

     Landlord leases the Premises to Tenant for a term of 182 months  commencing
February 1,  1999 and  continuing  through  March 31,  2014.  Base rent shall be
according to the following schedule:

--------------------------------------------------------------------------------
                                                                       Total
Estimated                                   Base Rent    Amortized    Base Rent
Period***                                   Per Month      Amount     Per Month
--------------------------------------------------------------------------------
February 1, 1999 through March 31, 1999    $91,881.00*        $0.00   $91,881.00
--------------------------------------------------------------------------------
April 1, 1999 through March 31, 2004      $150,318.00**  $14,347.00  $164,665.00
--------------------------------------------------------------------------------
April 1, 2004 through March 31, 2009      $165,350.00**  $14,347.00  $179,697.00
--------------------------------------------------------------------------------
April 1, 2009 through March 31, 2014      $181,848.00**       $0.00  $181,848.00
--------------------------------------------------------------------------------
     * This rental amount assumes that  possession of only the Space Two portion
of the Premises has been delivered.

     ** This rental amount assumes that possession of both the Space One and the
Space Two portions of the Premises have been delivered.

     ***  Subsequent  to Tenant's  occupancy  of both Space One and Space Two, a
lease  amendment  shall be executed by both Landlord and Tenant  confirming  the
lease commencement date, the lease termination date, adjusted rental amounts and
any other provisions as appropriate.

     Rent for the first month of the Lease term shall be paid upon  execution of
this Lease. All rent,  including base rent together with the charges,  taxes and
expenses to be paid to Landlord  specified in Paragraphs 3  and 4 of this Lease,
is  payable  in advance on the first day of each  calendar  month.  If  Landlord
consents,  Tenant may occupy the Premises prior to such  commencement  date upon
payment of rent on a prorated basis and compliance with all terms of this Lease.

     Delivery of possession of Space Two shall establish the commencement of the
182 month lease  term.  Delivery  of  possession  of Space Two shall be 120 days
after the date the Space Two shells are  sufficiently  complete  that Tenant can
commence Space Two tenant improvements pursuant to Paragraph 23.4 of this Lease.
Such date is estimated to be  October 1,  1998.  If such date will be earlier or
later than October 1,  1998,  Landlord shall provide Tenant with sixty (60) days
advance  written notice of the actual date.  Notwithstanding  the foregoing,  if
Landlord fails to deliver Space Two on or before  October 1,  1998 or to provide
such notification on or before January 1, 1999, Tenant may rescind this Lease by
notice in  writing  to  Landlord  on or before  January 15,  1999.  Delivery  of
possession  of Space  One  shall  be on  April 1,  1999.  However,  delivery  of
possession  of Space One shall  occur when Space One is occupied by Tenant or is
ready  to be  occupied  by  Tenant  with all work to be  performed  by  Landlord
substantially completed. No notice shall be required


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from  Landlord if Space One is ready on April 1,  1999 or on the first  business
day thereafter.  If it appears that such date will be earlier than or later than
April 1,  1999,  then Landlord  shall provide  Tenant with ten (10) days advance
written notice of same. If Landlord is unable to deliver possession of Space One
to Tenant because of strikes,  acts of God, or any other cause beyond Landlord's
control,  then Tenant may take possession  within ten (10) days of when Landlord
notifies Tenant that Space One is ready for  possession,  and rent for Space One
shall  commence  on the first day that  Tenant  takes  possession  of Space One.
Tenant  shall owe no rent on either  Space One or Space Two until  such space is
ready for  possession.  Landlord  shall  have no  liability  for such  delays in
delivery  of  possession,  and neither  party shall have the right to  terminate
except that  Landlord may cancel this Lease  without  liability if permission to
construct,  use, or furnish  necessary  utilities  to the  Premises is denied or
revoked by any governmental agency or public utility with such authority.

     This  Lease is  subject  to the  following  additional  terms to which  the
parties agree:

     1. USE OF THE PREMISES.

        1.1.  Tenant shall use the premises  only for the purpose of  conducting
the following business:

        Light manufacturing,  assembly, testing, warehousing and distribution of
finished testing equipment and general office related thereto.

        If such use is prevented by any law or governmental  regulation,  Tenant
may use the Premises for other uses allowed under law or governmental regulation
subject to the reasonable approval of Landlord.

        1.2. In connection with its use, Tenant shall at its expense comply with
all  applicable  laws,  ordinances,  and  regulations  of any public  authority,
including  those  requiring  alteration  of the  Premises  because  of  Tenant's
specific use; shall create no nuisance nor allow any objectionable liquid, odor,
or noise to be emitted  from the  Premises;  shall  store no  gasoline  or other
highly combustible  materials on the Premises which would violate any applicable
fire code or regulation nor conduct any operation that will increase  Landlord's
fire  insurance  rates for the  Premises;  and shall not  overload the floors or
electrical  circuits of the Premises.  Landlord  shall have the right to approve
the  installation  of any  power-driven  machinery  by Tenant  and may  select a
qualified electrician whose opinion will control regarding electrical circuits.

        1.3.  Tenant may erect a sign  stating its name and  business or product
after first securing  Landlord's  written approval of the size,  color,  design,
wording,  location,  and method of  attachment  and all  necessary  governmental
approvals.  No signs  shall be  painted on either the Space One or the Space Two
buildings  or project  above the height of either the Space One or the Space Two
buildings.  All signs  installed by Tenant shall be removed upon  termination of
this Lease with the sign location restored to its former state.

        1.4. Tenant shall make no alterations, additions, or improvements to the
Premises or change the color of the exterior  without  Landlord's  prior written
consent  and  without  a  valid  building   permit  issued  by  the  appropriate
governmental  agency.  Upon  termination  of this Lease,  any such  alterations,
additions,   or  improvements  (including  without  limitation  all  electrical,
lighting,  plumbing,  heating and air-conditioning  equipment,  doors,  windows,
partitions,  drapery,  carpeting,  shelving,  counters,  and physically attached
fixtures)  shall at once become part of the realty and belong to Landlord unless
the terms of the applicable consent provide otherwise.

    2.  SECURITY DEPOSIt. None Required.

    3.  UTILITY CHARGES; MAINTENANCE.

        3.1. Tenant shall pay when due all charges for electricity, natural gas,
water, garbage collection, janitorial service, sewer, and all other utilities of
any kind  furnished  to the Premises  during the lease term.  If charges are not
separately metered or stated, Landlord shall apportion the utility charges on an


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equitable   basis.   Landlord  shall  have  no  liability   resulting  from  any
interruption of utility services caused by fire or other casualty, strike, riot,
vandalism,  the making of necessary repairs or improvements,  or any other cause
beyond Landlord's  reasonable  control.  Tenant shall control the temperature in
the Premises to prevent freezing of any sprinkler system.

        3.2. Landlord shall repair and maintain the roof,  gutters,  downspouts,
exterior walls, building structure, foundation, exterior paved areas, curbs, and
landscaping of the Premises in good  condition.  Except for such  obligations of
Landlord, Tenant shall keep the Premises neatly maintained and in good order and
repair.  Tenant's  responsibility  shall include  maintenance  and repair of the
electrical system, plumbing, drainpipes to sewers,  air-conditioning and heating
systems,  overhead and personnel  doors,  and the  replacement  of all broken or
cracked  glass with glass of the same  quality.  Tenant  shall  refrain from any
discharge that will damage the sewers serving the Premises.

        3.3. If the  Premises  have a separate  entrance,  Tenant shall keep the
sidewalks abutting the Premises or the separate entrance free and clear of snow,
ice, debris, and obstructions of every kind.

     4. TAXES, ASSESSMENTS, AND OPERATING EXPENSES.

        4.1. In conjunction with monthly rent payments,  Tenant shall each month
pay a sum representing  Tenant's  proportionate share of real property taxes and
operating expenses for the Premises.  Such amount shall annually be estimated by
Landlord  in good faith to reflect  actual or  anticipated  costs.  At  periodic
intervals  during the term hereof and upon  termination of this Lease,  Landlord
shall  compute  its actual  costs for such  expenses  during  such  period.  Any
overpayment by Tenant shall be credited to Tenant,  and any deficiency  shall be
paid by Tenant within  thirty (30) days after  receipt of Landlord's  statement.
Landlord's records of expenses for taxes and operating expenses may be inspected
by Tenant at reasonable times and intervals.

        4.2. Tenant's proportionate share of real property taxes shall mean that
percentage of the total  assessment  affecting the Premises which is the same as
the  percentage  which  the  rentable  area of the  Premises  bears to the total
rentable area of all buildings  covered by the tax  statement.  If in Landlord's
reasonable  judgment  this  method of  allocation  results  in an  inappropriate
allocation  to Tenant,  Landlord  shall select some other  reasonable  method of
determining Tenant's  proportionate share. If the local assessment authority has
ascribed specific values to each of the buildings covered by the tax statements,
those values shall be used in computing  Tenant's relative share of the assessed
real property taxes.

        4.3. Real property taxes charged to Tenant  hereunder  shall include all
general real property taxes assessed  against the Premises or payable during the
lease term, installment payments on Bancrofted special assessments, and any rent
tax,  tax on  Landlord's  interest  under this Lease,  or any tax in lieu of the
foregoing,  whether  or not any such tax is now in  effect.  Tenant  shall  not,
however, be obligated to pay any tax based upon Landlord's net income.

        4.4.  Operating  expenses  charged to Tenant hereunder shall include all
usual and necessary costs of operating and  maintaining the Premises,  Building,
and any surrounding common areas including,  but not limited to, the cost of all
utilities or services not paid directly by Tenant, property insurance,  property
management,  maintenance and repair of landscaping, parking areas, and any other
common  facilities.  Operating  expenses  shall not include roof  replacement or
correction of structural  deficiencies  of either the Space One or the Space Two
buildings.

     5. PARKING AND STORAGE AREAS.

        5.1. Tenant, its employees, and customers shall have the exclusive right
to use  any  private  parking  spaces  immediately  adjacent  to or  part of the
Premises. Tenant shall control the use of such parking spaces so that there will
be no unreasonable  interference  with the normal traffic flow, and shall permit
no parking on any landscaped or unpaved surface.  Under no  circumstances  shall
trucks serving the Premises be permitted to block streets.

        5.2.  Tenant  shall not  store any  materials,  supplies,  or  equipment
outside in any  unapproved  or  unscreened  area.  If Tenant  erects any visible



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barriers for storage areas,  Landlord shall have the right to approve the design
and  location  of the  barriers.  Trash and  garbage  receptacles  shall be kept
covered at all times.

     6. TENANT'S INDEMNIFICATION; LIABILITY INSURANCE.

        6.1.  Tenant  shall not allow any liens to attach to the  Premises  as a
result of its  activities.  Tenant shall  indemnify and defend Landlord from any
claim, liability, damage, or loss arising out of any activity on the Premises or
within  either  the Space One or the Space Two  buildings  or the  common  areas
serving either the Space One or the Space Two buildings,  by Tenant, its agents,
or invitees or resulting  from Tenant's  failure to comply with any term of this
Lease.

        6.2.  Tenant shall carry  general  liability  insurance on an occurrence
basis with combined  single limits of not less than  $2,000,000.  Landlord shall
have the right to require  Tenant to increase this minimum  liability  insurance
limit by such  reasonable  amounts  as may be  required  to  adequately  protect
Landlord and Tenant in the future as a result of general  increases in liability
awards in the courts but in no event shall Landlord be allowed to require Tenant
to carry more than  $7,000,000 of liability  insurance.  Such insurance shall be
provided by an insurance carrier reasonably  acceptable to Landlord and shall be
evidenced by a certificate  delivered to Landlord stating that the coverage will
not be canceled or materially  altered  without ten (10) days'  advance  written
notice to Landlord.  Landlord  shall be named as an  additional  insured on such
policy,   but  only  with  respect  to  the  indemnity   granted  by  Tenant  in
Paragraph 6.1 above.

    7.  PROPERTY DAMAGE; SUBROGATION WAIVER.

        7.1. If fire or other casualty  causes damage to either the Space One or
the Space Two buildings in an amount  exceeding  fifty percent (50%) of the full
construction-replacement  cost  of  either  the  Space  One  or  the  Space  Two
buildings,  respectively,  Landlord may elect to terminate  this Lease as of the
date of the damage by notice in writing to Tenant  within thirty (30) days after
such date. Otherwise,  Landlord shall promptly repair the damage and restore the
Premises to their former condition as soon as practicable.  Rent shall be abated
during the period for that portion of the Premises not reasonably usable for the
use permitted by this Lease because of such damage and required repairs.

        7.2.  Landlord shall be responsible  for insuring both the Space One and
the Space Two  buildings,  and Tenant  shall be  responsible  for  insuring  its
personal property and trade fixtures located on the Premises.

        7.3. Landlord and Tenant each hereby releases the other, and the other's
partners, officers,  directors, agents and employees, from any and all liability
and  responsibility  to the releasing party and to anyone claiming by or through
it or under it, by way of subrogation or otherwise,  for all claims,  or demands
whatsoever  which arise out of damage or destruction  of property  occasioned by
perils which can be insured by an All Risk  Property  Insurance  Coverage  Form.
Landlord  and  Tenant  grant  this  release  on behalf of  themselves  and their
respective  insurance  companies and each  represents  and warrants to the other
that it is authorized by its respective insurance company to grant the waiver of
subrogation  contained in this  Paragraph 7.3.  This release and waiver shall be
binding upon the parties  whether or not  insurance  coverage is in force at the
time of the loss or destruction of property referred to in this Paragraph 7.3.

    8.  CONDEMNATION.

        If a  condemning  authority  takes  the  entire  Premises  or a  portion
sufficient  to render the  remainder  unsuitable  for Tenant's  use, then either
party may elect to terminate this Lease  effective on the date that title passes
to the  condemning  authority.  Otherwise,  Landlord  shall  proceed  as soon as
practicable to restore the remaining Premises to a condition  comparable to that
existing  at the time of the taking.  Rent shall be abated  during the period of
restoration to the extent the Premises are not reasonably usable by Tenant,  and
rent shall be reduced for the  remainder  of the term in an amount  equal to the
reduction in rental value of the Premises caused by the taking. All condemnation
proceeds for the land and buildings shall belong to Landlord  however Tenant may
separately  pursue a claim for award for business  interruption  and  relocation
costs.


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    9.  ASSIGNMENT AND SUBLETTING.

        9.1.  Tenant shall not assign its  interest  under this Lease nor sublet
the  Premises  without  first  obtaining  Landlord's  consent in writing,  which
consent shall not be unreasonably withheld or delayed.  Landlord will consent to
assignment  if the party to which the  Tenant's  interest in this Lease shall be
assigned has a financial capacity at the time of assignment,  as demonstrated by
audited financial statements of both Tenant and Assignee,  at least equal to the
financial  capacity of Tenant and  Assignee  will use the  Premises for a lawful
purpose not  materially  different from the ordinary use of the Premises or uses
for which the  Premises  are  adapted or for which they were  constructed,  or a
purpose approved by Landlord  pursuant to  Paragraph 1.1.  If the party to which
the  Tenant's  interest in this Lease  shall be assigned  does not meet the test
called  for in  the  preceding  sentence  Landlord  may  withhold  its  consent.
Landlord's  prior consent shall not be required for any assignment,  sublease or
other  transfer  of  Tenant's  interest  in the  Premises  or the  lease  to any
corporation with which Tenant may merge or consolidate or become affiliated as a
parent,  subsidiary,  holding company otherwise, or to an entity in which Tenant
has a controlling  interest.  A subsequent  public offering and sale of stock in
Tenant's  business,  or a transfer  of any amount of  Tenant's  stock  shall not
constitute a change in ownership of Tenant or an assignment of this Lease.  This
provision  shall apply to all  transfers by operation of law or through  mergers
and changes in control of Tenant.  No  assignment  shall  relieve  Tenant of its
obligation to pay rent or perform other  obligations  required by this Lease and
no one assignment or subletting shall be a consent to any further  assignment or
subletting.

        9.2. Subject to the above limitations on transfer of Tenant's  interest,
this Lease shall bind and inure to the benefit of the parties,  their respective
heirs, successors, and assigns.

    10. DEFAULT.

        Any of the  following  shall  constitute  a default by Tenant under this
Lease:

        10.1.  Tenant's failure to pay rent or any other charge under this Lease
within ten (10) days after it is due,  or failure to comply  with any other term
or condition  within  twenty (20) days  following  written  notice from Landlord
specifying the noncompliance.  If such noncompliance  cannot be cured within the
twenty (20) day period,  this provision  shall be satisfied if Tenant  commences
correction  within  such period and  thereafter  proceeds in good faith and with
reasonable diligence to effect compliance as soon as possible.

        10.2. Tenant's insolvency;  assignment for the benefit of its creditors;
Tenant's  voluntary  petition in bankruptcy or adjudication as bankrupt,  or the
appointment of a receiver for Tenant's properties.

    11. REMEDIES FOR DEFAULT.

        In case of default as described in  Paragraph 10  above,  Landlord shall
have the right to the following remedies which are intended to be cumulative and
in addition to any other remedies provided under applicable law:

        11.1.  Terminate this Lease without relieving Tenant from its obligation
to pay damages.

        11.2.  Retake  possession  of the  Premises  by summary  proceedings  or
otherwise,  in which case  Tenant's  liability  to Landlord  for  damages  shall
survive the tenancy. Landlord may, after such retaking of possession,  relet the
Premises upon any reasonable  terms.  No such reletting shall be construed as an
acceptance of a surrender of Tenant's leasehold interest.

        11.3.  Recover  damages  caused by Tenant's  default which shall include
reasonable  attorneys' fees at trial and on any appeal  therefrom.  Landlord may
sue periodically to recover damages as they occur throughout the lease term, and
no action for accrued damages shall bar a later action for damages  subsequently
accruing.  Landlord may elect in any one action to recover  accrued damages plus
damages  attributable to the remaining term of the Lease equal to the difference
between  the rent  under  this  Lease  and the  reasonable  rental  value of the
Premises for the  remainder of the term,  discounted  to the time of judgment at
the rate of six (6%) percent per annum.


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        11.4.  Make any payment or perform any obligation  required of Tenant so
as to cure Tenant's default, in which case Landlord shall be entitled to recover
all amounts so expended  from Tenant,  plus  interest at the rate of ten percent
(10%) per annum from the date of the expenditure.

    12. SURRENDER ON TERMINATION.

        12.1.  On expiration or early  termination  of this Lease,  Tenant shall
deliver all keys to Landlord,  have final  utility  readings made on the date of
move out, and  surrender  the Premises  clean and free of debris inside and out,
with  all  mechanical,  electrical,  and  plumbing  systems  in  good  operating
condition,  all signing removed and defacement corrected, and all repairs called
for under this Lease  completed.  The  Premises  shall be  delivered in the same
condition as at the  commencement of the term,  subject only to depreciation and
wear from ordinary  use.  Tenant shall remove all of its  furnishings  and trade
fixtures  that remain its  property and restore all damage  resulting  from such
removal.  Failure to remove said property  shall be an  abandonment of same, and
Landlord may dispose of it in any manner without liability.

        12.2. If Tenant fails to vacate the Premises when required, Landlord may
elect  either to treat  Tenant as a tenant  from month to month,  subject to all
provisions  of this Lease except the provision for term, or to eject Tenant from
the Premises and recover damages caused by wrongful holdover.

    13. LANDLORD'S LIABILITY.

        13.1.  Landlord  warrants that so long as Tenant complies with all terms
of this Lease it shall be entitled to peaceable  and  undisturbed  possession of
the  Premises  free from any  eviction  or  disturbance  by  Landlord or persons
claiming through Landlord.

        13.2.  All  persons  dealing  with  Pacific  Realty   Associates,   L.P.
("Partnership")  must look solely to the property and assets of Partnership  for
the  payment of any claim  against  Partnership  or for the  performance  of any
obligation of  Partnership  as neither the general  partner,  limited  partners,
employees,   nor  agents  of  Partnership  assume  any  personal  liability  for
obligations  entered  into on  behalf of  Partnership  (or its  predecessors  in
interest) and their respective  properties shall not be subject to the claims of
any person in respect of any such liability or obligation.  As used herein,  the
words "property and assets of partnership" exclude any rights of Partnership for
the payment of capital  contributions or other  obligations to it by the general
partner or any limited partner in such capacity.

    14. MORTGAGE OR SALE BY LANDLORD; ESTOPPEL CERTIFICATES.

        14.1.  This Lease  is  and  shall be  prior to any  mortgage  or deed of
trust ("Encumbrance") recorded after the date of this Lease and affecting either
the Space One or the Space Two  buildings and the land upon which both the Space
One and the Space Two buildings are located.  However,  if any lender holding an
Encumbrance  secured by either the Space One or the Space Two  buildings and the
land  underlying  either the Space One or the Space Two buildings  requires that
this Lease be subordinate to the Encumbrance, then Tenant agrees that this Lease
shall be subordinate to the  Encumbrance if the holder thereof agrees in writing
with Tenant that so long as Tenant performs its obligations  under this Lease no
foreclosure,  deed given in lieu of the  foreclosure,  or sale  pursuant  to the
terms  of the  Encumbrance,  or  other  steps  or  procedures  taken  under  the
Encumbrance  shall affect  Tenant's  rights under this Lease.  If the  foregoing
condition  is met,  Tenant  shall  execute the written  agreement  and any other
documents  required by the holder of the  Encumbrance to accomplish the purposes
of this paragraph.

        14.2. If  either  the  Space One or the Space  Two building is sold as a
result of foreclosure  of any  Encumbrance  thereon or otherwise  transferred by
Landlord or any  successor,  Tenant shall attorn to the  purchaser or transferee
according to the terms and conditions of this Lease,  and the  transferor  shall
have no further liability hereunder.

        14.3.  Either party shall within  twenty (20) days after notice from the
other  execute and deliver to the other party a certificate  stating  whether or
not this Lease has been modified and is in full force and effect and  specifying



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any  modifications or alleged breaches by the other party. The certificate shall
also  state the amount of  monthly  base rent,  the dates to which rent has been
paid in advance, and the amount of any security deposit or prepaid rent. Failure
to deliver the  certificate  within the specified time shall be conclusive  upon
the party of whom the  certificate was requested that the Lease is in full force
and effect and has not been modified  except as may be  represented by the party
requesting the certificate.

    15. DISPUTES - ATTORNEYS' FEES.

        In the event of any litigation arising out of this Lease, the prevailing
party  shall be  entitled to recover  from the other  party,  in addition to all
other relief provided by law or judgement,  its reasonable  costs and attorneys'
fees  incurred  both at and in  preparation  for trial and any appeal or review,
such  amount to be as  determined  by the  court(s)  before  which the matter is
heard.  Disputes  between the parties  which are to be litigated  shall be tried
before a judge without a jury.

    16. SEVERABILITY.

        If any provision of this Lease is  held to be  invalid, unenforceable or
illegal the remaining  provisions shall not be affected and shall be enforced to
the fullest extent permitted by law.

    17. INTEREST AND LATE CHARGES.

        Rent not paid within ten (10) days of when due shall bear  interest from
the date due until paid at the rate of eight percent (8%) per annum.

    18. GENERAL PROVISIONS.

        18.1.  Waiver by either party of strict  performance of any provision of
this Lease shall not be a waiver of nor prejudice the party's right otherwise to
require performance of the same provision or any other provision.

        18.2. Subject to the limitations on transfer of Tenant's interest,  this
Lease  shall bind and inure to the  benefit  of the  parties,  their  respective
heirs, successors, and assigns.

        18.3.  Landlord  shall have the right to enter upon the Premises  during
normal working hours after reasonable notice to Tenant, emergencies excepted, at
any time to determine  Tenant's  compliance  with this Lease,  to make necessary
repairs to the Premises,  or to show the Premises to any  prospective  tenant or
purchasers.  During  the last two  months  of the term,  Landlord  may place and
maintain upon the Premises notices for leasing or sale of the Premises.

        18.4.  If this Lease  commences or  terminates  at a time other than the
beginning  or end  of  one  of the  specified  rental  periods,  then  the  rent
(including  Tenant's share of real property  taxes, if any) shall be prorated as
of such date, and in the event of termination for reasons other than default all
prepaid rent shall be refunded to Tenant or paid on its account.

        18.5.  Either  party  shall  within  ten (10) days  following  the other
party's  written  request  deliver  to  the  other  party  a  written  statement
specifying the dates to which the rent and other charges have been paid, whether
the Lease is unmodified and in full force and effect, and any other matters that
may reasonably be requested by the other party.

        18.6.  Notices  between the  parties  relating to this Lease shall be in
writing,  effective when  delivered,  or if mailed,  effective on the second day
following mailing, certified mail, postage prepaid, to the address for the party
stated in this Lease or to such other  address  as either  party may  specify by
notice to the other.  Rent shall be payable to Landlord at the same  address and
in the same manner.

    19. ENVIRONMENTAL.

        19.1. DEFINITIONS.  The term "Environmental Law" shall mean any federal,
state or  local  statute,  regulation  or  ordinance  or any  judicial  or other
governmental  order  pertaining  to the  protection  of  health,  safety  or the


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environment.  The term "Hazardous  Substance"  shall mean any hazardous,  toxic,
infectious or radioactive substance,  waste and material as defined or listed by
any Environmental Law and shall include,  without limitation,  petroleum oil and
its fractions.

        19.2. USE OF HAZARDOUS SUBSTANCES.  Tenant shall not cause or permit any
Hazardous Substance to be spilled,  leaked, disposed of or otherwise released on
or under  the  Premises.  Tenant  may use and sell on the  Premises  only  those
Hazardous  Substances  typically used and sold in the prudent and safe operation
of the business  permitted by Paragraph 1  of this Lease.  Tenant may store such
Hazardous  Substances  on the  Premises,  but only in  quantities  necessary  to
satisfy  Tenant's  reasonably  anticipated  needs.  Tenant shall comply with all
Environmental  Laws and exercise the highest degree of care in the use, handling
and storage of Hazardous  Substances and shall take all practicable  measures to
minimize the quantity and  toxicity of  Hazardous  Substances  used,  handled or
stored on the Premises.

        19.3.  NOTICES.  Tenant shall immediately  notify Landlord upon becoming
aware of the  following:  (a) any spill,  leak,  disposal or other  release of a
Hazardous  Substance  on, under or adjacent to the  Premises;  (b) any notice or
communication  from a  governmental  agency or any other person  relating to any
Hazardous Substance on, under or adjacent to the Premises;  or (c) any violation
of any Environmental Law with respect to the Premises or Tenant's  activities on
or in connection with the Premises.

        19.4. SPILLS AND RELEASES.  In the event of a spill,  leak,  disposal or
other release of a Hazardous Substance on or under the Premises caused by Tenant
or any of its contractors,  agents or employees or invitees, or the suspicion or
threat of the  same,  Tenant  shall  (i)  immediately  undertake  all  emergency
response  necessary  to  contain,  cleanup  and  remove the  released  Hazardous
Substance,  (ii) promptly  undertake all  investigatory,  remedial,  removal and
other  response  action  necessary or  appropriate  to ensure that any Hazardous
Substances  contamination is eliminated to Landlord's  reasonable  satisfaction,
and (iii) provide  Landlord copies of all  correspondence  with any governmental
agency  regarding  the  release  (or  threatened  or  suspected  release) or the
response action, a detailed report  documenting all such response action,  and a
certification  that any  contamination  has been  eliminated.  All such response
action  shall be  performed,  all such  reports  shall be prepared  and all such
certifications  shall  be  made  by  an  environmental   consultant   reasonably
acceptable to Landlord.

        19.5.  CONDITION  UPON  TERMINATION.  Upon  expiration  of this Lease or
sooner  termination  of this  Lease for any  reason,  Tenant  shall  remove  all
Hazardous  Substances  and  facilities  used  for the  storage  or  handling  of
Hazardous  Substances  from the  Premises  and  restore  the  affected  areas by
repairing any damage caused by the  installation  or removal of the  facilities.
Following  such  removal,  Tenant shall  certify in writing to Landlord that all
such removal is complete.

        19.6.  ASSIGNMENT  AND  SUBLETTING.  Notwithstanding  the  provisions of
Paragraph 9 of this Lease, it shall not be unreasonable for Landlord to withhold
its  consent to any  assignment,  sublease  or other  transfer  of the  Tenant's
interest  in  this  Lease  if a  proposed  transferee's  anticipated  use of the
Premises  involves the generation,  storage,  use, sale,  treatment,  release or
disposal of any Hazardous Substance.

        19.7. INDEMNITY.

              19.7.1.  BY  TENANT.  Tenant  shall  indemnify,  defend  and  hold
harmless  Landlord,  its  employees and agents,  any persons  holding a security
interest in the Premises,  and the respective  successors and assigns of each of
them from and against any and all claims, demands, liabilities,  damages, fines,
losses,  costs  (including  without  limitation  the cost of any  investigation,
remedial,  removal or other response action required by  Environmental  Law) and
expenses  (including  without  limitation  attorneys'  fees and  expert  fees in
connection  with any  trial,  appeal,  petition  for  review  or  administrative
proceeding)  arising  out of or in any  way  relating  to  the  use,  treatment,
storage, generation, transport, release, leak, spill, disposal or other handling
of Hazardous  Substances  on the  Premises by Tenant or any of its  contractors,
agents or employees or invitees. Tenant's obligations under this paragraph shall
survive the expiration or  termination of this Lease for any reason.  Landlord's
rights  under this  paragraph  are in  addition  to and not in lieu of any other
rights or remedies to which  Landlord  may be entitled  under this  agreement or
otherwise.


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<PAGE>

             19.7.2. BY LANDLORD.  Landlord  shall indemnify,  defend  and  hold
harmless  Tenant and its employees and agents and the respective  successors and
assigns  of  each  of them  from  and  against  any  and  all  claims,  demands,
liabilities,  damages,  fines,  losses,  costs (including without limitation the
cost of any investigation,  remedial,  removal or other response action required
by Environmental Law) and expenses (including without limitation attorneys' fees
and expert fees in  connection  with any trial,  appeal,  petition for review or
administrative  proceeding)  arising out of or in any way relating to the actual
or alleged use, treatment, storage, generation, transport, release, leak, spill,
disposal or other handling of Hazardous  Substances on the Premises by Landlord,
or any of its contractors, agents or employees or by Landlord's previous tenants
of the Premises.  Landlord's  obligations under this paragraph shall survive the
expiration or  termination of this Lease for any reason.  Tenant's  rights under
this  paragraph  are in  addition  to and  not in lieu of any  other  rights  or
remedies to which Tenant may be entitled under this Agreement or otherwise.

    20. BROKER REPRESENTATION.

        Each  party  represents and  warrants  to the  other that it has  had no
dealings  with or in any way engaged the  services of any real estate  broker or
agent in connection with the negotiation or execution of this Lease.  Each party
hereby  agrees to indemnify  and hold the other party  harmless from and against
any  and  all  costs,   expenses  and  liabilities  for  commissions  and  other
compensation  claimed by any broker or agent in  connection  herewith  resulting
from breach of the representation and warranty contained in this paragraph.

    21. OPTION TO RENEW.

        If not then in  default,  Tenant  shall  have the option  to renew  this
Lease for two (2) additional  5-year terms by giving Landlord  written notice of
its intent to extend at least  180 days  prior to  expiration  of the  preceding
term. All provisions of this Lease shall apply during the extended term,  except
that rent for the renewal  period shall be an amount  agreed upon by the parties
at least ninety (90) days prior to commencement of the renewal period. If Tenant
elects not to exercise the first 5-year  option  period,  then the second 5-year
option period shall be null and void.

    22. DESIGN OF BUILDING SHELLS.

        Landlord  shall provide  improvements  consisting  of  site improvements
and the  building  shells  for Space One and Space Two.  The Space One  building
shall be designed by Curtis Beattie & Associates. Site improvements for both the
Space One and Space Two  buildings  and the Space Two  building  shells shall be
designed by Group Mackenzie.  Landlord may contract with additional  engineering
firms and design-build contractors as Landlord shall select.

        22.1. The Space One  building  shall  be designed and constructed  using
the  standards set forth in Exhibit B  attached  hereto.  The building  shell of
Space One shall,  from an exterior  appearance  and interior core  standpoint be
substantially in accordance with the floor plans and elevations  attached hereto
as Exhibit E.

        22.2. The Space Two buildings shall be  designed  and  constructed using
using the standards set forth in Exhibit C  attached hereto. The building shells
of Space Two shall, from an exterior appearance standpoint,  be substantially in
accordance with the floor plans and elevations attached hereto as Exhibit F. The
building  shells  of  Space  Two  will be  connected  by a  13,000  square  foot
connection  at a  location  west of the mid  point of the  long  axis of the two
building shells (the "Westerly  Connection") and a 7,800 square  foot connection
at a location east of the mid point of the long axis of the two building  shells
(the "Easterly Connection").

       22.3. The building  shells  (including  the interior  core of  Space One)
shall be designed and approved as follows:

             22.3.1.    Within ten (10) days  following  the full  execution  of
this  Lease  by  the  parties,   Landlord  shall  cause  preliminary  plans  and
specifications (the "Preliminary Review Documents") to be prepared and submitted
to Tenant for review and approval.  Said  Preliminary  Review Documents shall be
sufficiently detailed to indicate the exterior appearance of the buildings,  the


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<PAGE>

layout of the interior core elements of Space One, the location of major utility
elements in all  buildings  and on the site,  the general  description  of major
structural  elements  including  roof  structure,  location and size of overhead
doors for Space Two as well as a description of landscape elements for the site.
Tenant shall have five (5) business days  following  receipt of the  Preliminary
Review  Documents to review said  documents and provide review  comments  and/or
approval of the items proposed by Landlord. Following receipt of Tenant's review
comments  Landlord shall within five (5) business days make necessary changes to
conform the Preliminary  Review  Documents to Tenant's review  comments,  and in
areas not conformed,  provide to Tenant Landlord's  reason for  non-conformance.
Following receipt of the Preliminary  Review Documents,  Tenant shall thereafter
have five (5) business  days (the "Final  Review  Period") to review and approve
the revised  documents.  If final  revisions are not acceptable to Tenant by the
end of the Final Review Period, Tenant may, by giving written notice to Landlord
pursuant to  Paragraph 18.6,  terminate  this Lease,  whereupon  Tenant shall be
liable to Landlord for 50% of the cost  incurred by Landlord for all elements of
the Preliminary Review Documents, not to exceed $5,000.00.

              22.3.2.  Tenant shall have the option to cause to be designed  and
constructed a covered  walkway  connecting  Space One to Space Two (the "Covered
Walkway").  The cost of the design and construction of the Covered Walkway shall
be paid by  Tenant.  Tenant  may also  design  landscape  elements  between  the
Easterly  Connection  and the  Westerly  Connection.  The design of the  Covered
Walkway and the landscaped area between the connections  shall be subject to the
reasonable  approval of Landlord and if Landlord and Tenant  cannot agree on the
design of the Covered  Walkway  and/or the landscaped  area between,  and/or the
Easterly and Westerly  Connections,  the dispute shall be settled by arbitration
under Paragraph 24 of this Lease.

              22.3.3.  Following  approval of the Preliminary Review  Documents,
or in the case of  arbitration,  upon the decision by the  arbitrator,  Landlord
shall,  within fifteen (15) business  days,  cause  construction  documents (the
"Construction  Documents") to be commenced.  When prepared, Tenant shall receive
three (3) copies of the Construction  Documents and may within five (5) business
days following  receipt of such documents  provide to Landlord notice in writing
of any  contention by Tenant that the  Construction  Documents do not conform to
the approved  Preliminary  Review Documents.  If Tenant provides such notice and
Landlord refuses to comply with Tenant's request for changes to the Construction
Documents,  then the dispute may be submitted  by either  party for  arbitration
pursuant to Paragraph 24. A request for arbitration must be made within ten (10)
days following  Tenant's notice to Landlord of  non-conformance  provided for in
this  paragraph.  The  decision  of the  arbitrator  shall be binding  upon both
parties. The time taken for such arbitration shall be added to the time Landlord
has for delivery of the Premises.

              22.3.4. Following final approval of the Construction Documents  by
either mutual  agreement or by  arbitration,  Landlord shall promptly pursue the
issuance of all necessary  building permits and shall cause  construction of the
building  shells  to be  undertaken  by  contractors  selected  by  Landlord  at
Landlord's expense.

    23.  TENANT IMPROVEMENTS.

         23.1. Landlord  shall  be  responsible  for  construction   of   tenant
improvements  within   Space  One  in  accordance  with  the  approved Plans and
Specifications called for in this paragraph.  Exhibit D sets forth the standards
for the tenant  improvements to be constructed within Space One. Tenant shall be
responsible for construction of all tenant improvements to be constructed within
Space  Two.  The  tenant  improvements  within  Space One and Space Two shall be
funded through the allowance  provided for in  Paragraph 23.2  below.  All items
charged  against  the  Allowance  shall  be  pre-approved  by  Tenant  prior  to
construction of such items. All  improvements  shall be designed and constructed
using Landlord's  building  standard  finishes or alternate  materials  mutually
acceptable to both Tenant and Landlord. Tenant improvements shall be constructed
using industry standard materials  installed in a good and workmanlike manner by
qualified  craftsmen.  Said tenant  improvements shall be constructed from plans
and specifications (the "Plans and Specifications") prepared by an architectural
firm mutually acceptable to both Landlord and Tenant (the "Architectural  Firm")
which Plans and Specifications  shall be subject to applicable building codes as
interpreted by all governing jurisdictions, including City of Hillsboro, Oregon.



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<PAGE>

The Plans and Specifications  shall be approved by Landlord within ten (10) days
of  Landlord's  receipt  of  same,  which  approval  shall  not be  unreasonably
withheld.  Changes from  Landlord  approved  Plans and  Specifications  shall be
approved in writing by Landlord.

         23.2. Landlord shall provide Tenant with a tenant improvement allowance
of $3,212,375.00  (the  "Allowance") for all tenant  improvement work to be done
hereunder. The Allowance is based upon the following calculations:

<TABLE>
<S>                   <C>                           <C>                     <C>
Office Space:         $25.00 per square foot for -   71,265 square feet     $1,781,625.00
Manufacturing Space:  $15.00 per square foot for -   87,050 square feet     $1,305,750.00
Warehouse Space:       $5.00 per square foot for -   25,000 square feet     $  125,000.00
                                                    -------                  ------------
Total:                                              183,315 square feet     $3,212,375.00
</TABLE>

               All tenant improvements within Space One shall be charged against
the Allowance.  When Space One Plans and Specifications  have been bid, the cost
of the work shall be reviewed  and approved by Tenant  within ten (10)  business
days of receipt by  Tenant.  The cost of any  subsequent  changes  requested  by
Tenant or of additional work required which is not within the scope of the Plans
and  Specifications  shall be approved by Tenant prior to  commencement  of such
work. If the tenant improvements cannot be constructed within the balance of the
Allowance  remaining after the Space One tenant  improvement costs have been set
aside for  completion  of Space One,  Tenant  agrees to pay its Space Two tenant
improvement  contractor  the amount by which  this cost  exceeds  the  remaining
balance of the Allowance.

          23.3. Landlord  agrees to  amortize up to $1,000,000.00 of  additional
tenant  improvement  costs in excess of the Allowance over  120 months at twelve
(12%) percent  interest.  Amortization of $1,000,000.00  will result in a rental
increase of $14,347.00 (the  "Amortized  Amount") per month as shown in the rent
schedule on Page 1 of this Lease.

          23.4. Tenant shall, as  referenced in  Paragraph 23.2  above, contract
with  a  tenant  improvement   contractor  approved  by  Landlord,  to  complete
improvements  within Space Two in accordance with the Plans and  Specifications.
Tenant shall be responsible for payment of all contractor billings for such work
and will submit proof of such payments to Landlord.  Each proof of payment shall
be accompanied by a copy of the contractor's  most recent draw request presented
on AIA form number G702 or similar.  Landlord shall, within fifteen (15) days of
receipt of  Tenant's  proof of payment,  reimburse  Tenant for amounts up to the
remaining balance of the Allowance as referenced in  Paragraph 23.2  above, plus
any additional funds to be amortized pursuant to Paragraph 23.3 above.

          23.5. Should  Tenant elect to  have  Landlord  amortize an amount less
than  $1,000,000.00,  then the  Amortized  Amount shall be modified by the lease
amendment  referenced  on Page 1,  Line 30 of this Lease using the  amortization
schedule used to set the amortized amount.

          23.6. Landlord shall not charge Tenant any construction or development
fees nor charge any of its employees' time against the Allowance.  Any sums paid
to the  Architectural  Firm or other  consultants  and any out of  pocket  costs
incurred by Landlord as part of the tenant  improvement shall be charged against
the Allowance.

    24.  ARBITRATION OF DESIGN DISPUTE.

         24.1.  Tenant intends to construct a covered  walkway between Space One
and Space Two. Any dispute  regarding the design of the covered  walkway  and/or
the landscaped  area between the Easterly or Westerly  Connection or conformance
of the Space One or Space  Two  building  shell  Construction  Documents  to the
approved  Preliminary  Review  Documents  shall be  decided  by  arbitration  in
accordance with the then current Construction  Industry Arbitration Rules of the
American Arbitration  Association,  unless the parties mutually agree otherwise.
The arbitration  shall take place in Portland,  Oregon,  and shall be subject to
the arbitration statutes of the state of Oregon.  Disputes shall be decided by a
single arbitrator. This agreement to arbitrate shall be specifically enforceable
under the prevailing arbitration law.



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<PAGE>

         24.2.  Notice of the demand  for arbitration  shall be filed in writing
with the other party to this Agreement. The demand for arbitration shall be made
within ten (10) days following Tenant's notice to Landlord of the existence of a
dispute.

         24.3. The  decision  rendered  by  the arbitrator  shall  be final, and
judgment may be entered upon it in accordance  with  applicable law in any court
having jurisdiction thereof.

     IN WITNESS WHEREOF,  the parties hereto have executed this Agreement on the
respective  dates set opposite  their  signatures  below,  but this Agreement on
behalf of such  party  shall be deemed to have been  dated as of the date  first
above written.

                                 LANDLORD:

                                 PACIFIC REALTY ASSOCIATES, L.P.,
                                 a Delaware limited partnership

                                 By:   PacTrust Realty, Inc.,
                                       a Delaware corporation,
                                       its General Partner

          4/22                           /s/ SAM K. BRIGGS
Date:  -------------, 1998       By: ----------------------------------
                                       Sam K. Briggs
                                       Vice President

                                 Address for Notices/Rent Payments to Landlord:
                                 15350 S.W. Sequoia Parkway, #300-WMPC
                                 Portland, OR  97224


                                 TENANT:

                                 CREDENCE SYSTEMS CORPORATION,
                                 a California corporation


          APRIL 16                      /s/ W.R. BOTTOMS
Date:  --------------, 1998      By: ----------------------------------
                                 Name:  W.R. Bottoms
                                 Title: CEO



Date:  ________________, 1998    By:
                                 Name:
                                 Title:


                                 Address for Legal Notices to Tenant:



                                 Address for Invoices to Tenant:



                                 Tenant Employer Identification Number:






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Page 12 of 12                                                      Hillsboro, OR
<PAGE>

                                   EXHIBIT "A"



MAP OF FIVE OAKS WEST BUSINESS PARK
HILLSBORO, OREGON

Not to Scale.

<PAGE>

                                   EXHIBIT "B"


                          CREDENCE SYSTEMS CORPORATION
                    BUILDING SHELL DESCRIPTION AND DEFINITION
                           OFFICE BUILDING (SPACE ONE)
                          FIVE OAKS WEST BUSINESS PARK


                                 March 27, 1998


GENERAL -

The building architectural  features to meet ADA compliance  requirements at the
time of project  design.  Any design  changes  subsequent to Final  Construction
Documents shall be approved in writing by Tenant's designated representative.

SITEWORK -

All  site  improvements  required  for a  complete  and  operable  facility  are
included.  Sitework includes  utilities such as water,  sanitary sewer,  natural
gas,  power,  and phone system  conduits.  Sitework  also  includes  storm water
collection,   detention,  and  disposal;  asphalt  paving;  concrete  sidewalks;
landscaping; and site lighting.

BUILDING ENVELOPE -

The building  envelope includes shallow,  spread footing  foundations;  concrete
slab on grade;  composite steel and concrete upper floor structures;  steel roof
structure;  structural metal stud exterior wall framing;  exterior brick veneer;
and  exterior  aluminum  and glass window and  storefront  systems.  The roofing
system shall be constructed  using rigid  insulation  and built-up  roofing with
mineral cap sheet using a steel roof structure.

BUILDING INTERIOR IMPROVEMENTS -

     EXTERIOR   WALLS:   Exterior  walls  shall  be  insulated  with  R-19  batt
     insulation.  Vapor barrier and gypsum board shall be provided and installed
     under tenant improvement construction.

     CORRIDOR  AND COMMON  AREA  WALLS:  Shell  construction  includes  framing,
     insulation,  and finished gypsum board on the improved side of corridor and
     common area walls (rest rooms, stairs,  utility rooms, etc.).  Corridor and
     other common area  walls shall  be  constructed  using 3-5/8" metal  studs,
     3 1/2" fiberglass batt  insulation,  and 5/8" smooth finished gypsum board.
     Exposed  framing  and  insulation  will  remain  facing  areas  for  tenant
     improvements.

     BUILDING COLUMNS:  Building structural columns are left exposed under shell
     construction.

     INTERIOR  PARTITIONS:   Interior  partitions  are  not  included  in  shell
     construction.

     INTERIOR DOORS:  Common area interior doors shall be nominal 3'-0" by 9'-0"
     solid core ribbon sapele,  stained to a dark cherry wood finish  ("Building
     Standard Finish") in Timely II door frames,  factory painted to approximate
     door color ("Building Standard Frame"). Door hardware for common area doors
     to include 2 pair butts,  Schlage "D" series (or similar) lever latch,  and
     wall  stop for each  door.  Door  hardware  finish  to be  polished  brass.
     Interior   doors  for   tenant   areas  are  part  of  tenant   improvement
     construction.



N-CREDEN-B.DOC / SKB / LMH / Exhibit B                                     5Oaks
4/9/98
Page 1 of 3                                                        Hillsboro, OR

<PAGE>

     ACOUSTICAL  CEILINGS:  The acoustical  ceiling  suspension  system shall be
     installed in a 4' by 4' grid, and ceiling tile and remaining tee's supplied
     under building shell construction. Tenant improvement construction includes
     installation of 2' by 2' tegular edge ceiling tile (Armstrong Minatone #705
     Fissured) and necessary tee's in the building shell ceiling grid.

     PAINTING:  All common area interior walls and ceilings shall receive primer
     and two coats of finish paint on improved surfaces.  Painting within tenant
     areas is part of tenant improvement construction.

     FLOOR COVERINGS:  All improved common areas shall receive appropriate floor
     covering.  Carpet shall be provided at corridors  and stairs;  ceramic tile
     and carpet shall be provided in toilet rooms; and exposed,  sealed concrete
     will be provided in elevator  machine,  janitor,  fire sprinkler riser, and
     electrical  rooms.   Carpet  shall  be  Atlas  "Custom  Multituff,"  Bently
     "Mirano," or equal, over pad, at common area locations except for fire exit
     stairs. Fire exit stairs to receive 26 ounce direct glue loop carpet, Atlas
     "Oxford Place," or equal.  Wainscot wall tile in toilet rooms to be Daltile
     4 1/4" by 4 1/4" glazed  ceramic with  Group 2 color.  Floor tile in toilet
     rooms to be Daltile 2" by 2" unglazed  porcelain with Group 2 color.  Floor
     covering within tenant areas is part of tenant improvement construction.

     WINDOW   COVERINGS:   Window   coverings  are  not  included   under  shell
     construction.

     CABINETS AND MILLWORK: Cabinets and other special millwork are not included
     under shell construction.

     APPLIANCES: The cost of appliances such as dishwashers,  refrigerators, and
     microwave  ovens,  and vending  machines,  coffee  makers or other  similar
     equipment are part of tenant improvement costs.

     FURNITURE AND ACCESSORIES:  Furniture,  coat hooks,  desk partitions,  tack
     boards,  projection  screens,  fire  extinguishers and cabinets,  and other
     miscellaneous accessories shall be provided and installed by tenant.

     SIGNAGE: Toilet room signs are included. Toilet room signs to approximately
     8" by 8",  constructed  of  phenolic  base with white  raised  letters  and
     graphics.  Signs to be ADA compliant with Grade 2  Braille  feature.  Other
     interior and exterior signage shall be provided and installed by tenant.

     ELEVATORS:  Two (2) each, 3-stop hydraulic  elevators are included by Otis,
     Dover,  Schindler,  Montgomery,  or  equal.  Each car to have  3,000  pound
     capacity at 150 f.p.m. Doors, door frames and control panels to be finished
     in satin  bronze.  Interior  cab  panels to be  constructed  of wood  grain
     laminate. Interior cab ceiling to be mirror bronze finish with incandescent
     downlights. Cab protection blankets for moving are included.

     PLUMBING:  Shell  plumbing  work  includes  underslab  sanitary  sewer  and
     overhead  water  piping to  common  area  plumbing  fixtures.  Common  area
     plumbing  fixtures include water closets,  urinals,  and lavatories in main
     toilet rooms on each floor, a drinking fountain  (handicap  accessible) for
     each floor, one janitor sink, and one water heater. Each Men's room to have
     two (2)  wall-hung  urinals,  two (2) water  closets,  and two (2)  counter
     mounted  lavatories.  Each Women's room to have four (4) water  closets and
     two (2) counter  mounted  lavatories.  Two (2) "wet"  columns are  included
     within the tenant space. Wet columns include waste and vent piping and cold
     water only. Extension of plumbing within tenant areas is tenant improvement
     work.

     FIRE PROTECTION:  Building shell fire protection system includes service to
     the  building  and  overhead  sprinkler  piping.  Tenant  improvement  fire
     protection work includes the addition of "drops" to the area below ceilings
     and chrome, semi-recessed sprinkler heads. Special fire suppression systems
     such as intergen or  preaction  systems,  if  required,  are part of tenant
     improvement work.


-CREDEN-B.DOC / SKB / LMH / Exhibit B                                     5Oaks
4/9/98
Page 2 of 3                                                        Hillsboro, OR



<PAGE>

     H.V.A.C.:  Building shell construction includes a closed loop, water-source
     heat pump system with high  efficiency  cooling tower and boiler.  Roof-top
     cooling  tower has  approximately  200 ton  capacity.  Gas fired boiler has
     approximately 1,000,000 BTU (input) capacity. System includes DDC automated
     control  with  central  panel  operation  of energy  management  functions.
     Modulating  outside air supply and exhaust is managed by the DDC controller
     and  ducted to and from each zone.  Supply and return air main trunk  ducts
     and main water loop piping shall be provided  under the building shell HVAC
     work. Heat pumps,  thermostats,  duct extensions,  connections to the water
     loop,   and  supply  and  return  air  diffusers  are  tenant   improvement
     construction.  Special  computer  room,  conference  room,  and lunch  room
     cooling and ventilation, if required, are tenant improvement work.

     ELECTRICAL:   Building   shell   electrical   work   includes  a  1200 amp,
     277/480 volt, 3-phase, 4-wire main distribution panel with wires in conduit
     to electrical  distribution panels on each floor. Building shell electrical
     work also  includes  lighting  and  miscellaneous  convenience  outlets  in
     building  common areas  (i.e.,  toilet  rooms,  electrical  rooms,  stairs,
     utility rooms, etc.). Tenant improvement  electrical work includes breakers
     in shell electrical panels,  extension of power from the electrical room to
     the tenant space,  the addition of any tenant  subpanels  within the space,
     and furnishing and installation of lighting and power outlets.

     Three-tube  fluorescent  light fixtures with 18-cell parabolic lenses shall
     be supplied under building shell construction.  One fixture is included for
     each 90 square feet of tenant office area. Fixtures shall be stocked on the
     floor for installation and wiring under tenant improvement construction.

     Generators, uninterruptable power supplies, and special electrical work for
     computer and phone systems, if required, are tenant improvement work.

     FIRE ALARM:  Fire alarm system  includes  flow and tamper  switches for the
     sprinkler  system and smoke  detection  only as required  for  elevator and
     common area features. Fire alarm systems related to tenant improvements are
     not part of shell construction.

     SECURITY  SYSTEMS:  Security  systems  shall be provided  and  installed by
     tenant.

     TELEPHONE  AND COMPUTER  SYSTEMS:  Telephone,  data,  and  computer  system
     equipment and wiring shall be provided and installed by tenant.













N-CREDEN-B.DOC / SKB / LMH / Exhibit B                                     5Oaks
4/9/98
Page 3 of 3                                                        Hillsboro, OR

<PAGE>

                                  EXHIBIT "C"


                          CREDENCE SYSTEMS CORPORATION
                    BUILDING SHELL DESCRIPTION AND DEFINITION
                WAREHOUSE AND MANUFACTURING BUILDINGS (SPACE TWO)
                          FIVE OAKS WEST BUSINESS PARK


                                 April 10, 1998



SITEWORK -

All  site  improvements  required  for a  complete  and  operable  facility  are
included.  Sitework includes  utilities such as water,  sanitary sewer,  natural
gas,  power,  and phone system  conduits.  Sitework  also  includes  storm water
collection,   detention,  and  disposal;  asphalt  paving;  concrete  sidewalks;
landscaping; and site lighting.

BUILDING ENVELOPE -

The building  envelope includes shallow,  spread footing  foundations;  concrete
slab on grade;  steel and wood roof structure;  tilt-up concrete  exterior walls
with partial  brick veneer,  Mutual  Materials  "Inca" or similar;  and exterior
aluminum and glass window and storefront  systems,  U.S. Aluminum painted frames
with PPG insulated solarcool azurlite glass. The roof membrane shall be built-up
roofing with mineral cap sheet.

BUILDING SHELL -

     TENANT  ENTRIES AND  MAN-DOORS:  Tenant doors in aluminum  systems  include
     single  storefront  doors  with  push-pull  hardware  and  deadbolt  locks.
     Exterior  man-doors  in  concrete  and brick  walls shall be 3' x 7' hollow
     metal with  Schlage "D" series  lever  locks.  Special  access and security
     systems,  card lock entries, and other special door hardware,  if required,
     are part of tenant improvement work.

     EXTERIOR  WALLS:  Exterior  concrete walls within the building shall remain
     unpainted,  exposed  concrete.  Metal stud furring  and/or  insulation  for
     exterior concrete walls is part of tenant improvement work. Framed exterior
     walls  shall be  insulated  with R-19 batt  insulation.  Vapor  barrier and
     gypsum  board for framed  exterior  walls shall be provided  and  installed
     under tenant improvement construction.

     ROOF  STRUCTURE:  The roof structure  shall be  constructed  using open web
     steel  girders  and  joists,  wood  sub-purlins,  and  plywood  deck.  Roof
     structure  is insulated  with R-19  insulation  and shall  remain  exposed.
     Painting of roof structure and supporting elements,  if required,  shall be
     done under tenant improvement work.

     OVERHEAD DOORS: Four (4) each, 9' by 10' dock doors are included.  Exterior
     dock doors shall be steel sectional type, motor operated,  vertical or high
     lift  configuration.  Approximately  50 linear  feet  of  steel  canopy  is
     included  over the loading dock doors.  Canopy to extend  approximately  3'
     from  building  face. Up to four (4) drive-in  doors,  each 12' by 14', are
     included.  Drive-in doors shall be steel  sectional  type,  chain operated,
     vertical or high lift configuration and shall be located in concrete panels
     which do not have brick veneer facing.

     FLOORING: Warehouse floor shall be exposed, sealed concrete.

     PAINTING:  All exterior  concrete walls will be painted with exterior latex
     paint.  Exterior  masonry  walls to  receive  clear  sealer.  Interiors  of
     buildings shall remain unpainted.

     WINDOW   COVERINGS:   Window   coverings  are  not  included   under  shell
     construction.

N-Creden-c.doc / SKB / LMH / Exhibit C                                     5Oaks
5/26/98
Page 1 of 2                                                        Hillsboro, OR

<PAGE>


     PLUMBING:  One 4" diameter  sanitary  sewer  waste line shall be  installed
     under slab running the entire length of each building.  A 1-1/2"  insulated
     overhead  copper  water line shall be  installed  below the roof  structure
     directly above the sanitary sewer. Any other water,  waste, and vent piping
     and furnishing and installation of plumbing fixtures is tenant  improvement
     work. Air piping, gas piping,  process piping, and other special piping, if
     required, shall be part of tenant improvement work.

     FIRE PROTECTION:  Building shell fire protection system includes service to
     the buildings and overhead  sprinkler piping and heads. The system shall be
     designed for Ordinary Hazard, Group 2 occupancies.  Tenant improvement fire
     protection work includes the addition of "drops" to the area below ceilings
     and chrome, semi-recessed sprinkler heads. Special fire suppression systems
     such as intergen or  preaction  systems,  if  required,  are part of tenant
     improvement work.

     H.V.A.C.:   HVAC  systems  shall  be  installed  under  tenant  improvement
     construction.

     ELECTRICAL:  Building shell electrical work includes a 6000 Amp (2 building
     total), 277/480 Volt, 3-phase main electrical service. Site lighting in the
     vicinity  of the  buildings  shall  be  served  from the  shell  electrical
     service.  Tenant improvement electrical work includes distribution of power
     from the main building  service to tenant subpanels and the addition of any
     tenant  subpanels within the tenant space.  Generators and UPS systems,  if
     required,  are part of tenant  improvement work.  Interior  electrical work
     shall be installed under tenant improvement construction.

     FIRE  ALARM:  The  fire  alarm  system  includes  flow  and  tamper  switch
     monitoring  for the sprinkler  system only.  Fire alarm systems  related to
     tenant improvements are not part of shell construction.

     SECURITY  SYSTEMS:  Security  systems  shall be provided  and  installed by
     tenant.

     TELEPHONE  AND COMPUTER  SYSTEMS:  Telephone,  data,  and  computer  system
     equipment and wiring shall be provided and installed by tenant.









N-Creden-c.doc / SKB / LMH / Exhibit C                                     5Oaks
5/26/98
Page 2 of 2                                                        Hillsboro, OR

<PAGE>

                                   EXHIBIT "D"


                          CREDENCE SYSTEMS CORPORATION
                          TENANT IMPROVEMENT STANDARDS
                           OFFICE BUILDING (SPACE ONE)

                          FIVE OAKS WEST BUSINESS PARK

                                 April 10, 1998


GENERAL -

Items noted as "excluded"  are items which  Landlord will consider for inclusion
but are not included in a typical  improvement and do not generally fit within a
building standard tenant improvement allowance.

CONCRETE -

Existing  concrete slab on grade shall be sawcut,  removed,  and poured back for
underslab  utilities  as  necessary.  Existing  upper  floor slabs shall be core
drilled for utilities as necessary;  new penetrations in upper floor slabs shall
be sealed tight.

DEMISING WALLS -

Demising  walls are not  applicable to this project.  When used,  demising walls
shall  extend from floor level to the  underside of the ceiling  grid.  Demising
walls shall be constructed using 3-5/8" metal studs,  3-1/2" unfaced  fiberglass
batt  insulation,  and 5/8" smooth  finished gypsum board on each side. Raco FS4
black reveal header shall be used at  connection  of walls to ceiling.  4' wide,
3-1/2"  unfaced  fiberglass  batt  insulation  shall be provided  above ceiling,
centered over demising walls.

EXTERIOR WALLS -

Exterior  walls shall  receive 5/8" smooth  finished  gypsum board over existing
framing and thermal  insulation.  Raco FS4MB black recessed reveal molding to be
used at connections of walls to ceilings.

CORRIDOR AND COMMON AREA WALLS -

Corridor and other common area walls (rest rooms,  stairs,  utility rooms, etc.)
shall be constructed  using 3-5/8" metal studs,  3-1/2" unfaced  fiberglass batt
insulation,  and 5/8" smooth finished gypsum board each side. Shell construction
includes framing,  insulation, and finished gypsum board on the corridor side of
corridor  walls.  Tenant  improvement   construction   includes  furnishing  and
installation  of smooth finished gypsum board on the tenant side of corridor and
common area walls.

BUILDING COLUMNS -

Building  structural  columns  shall be furred with metal stud  framing and 5/8"
smooth  finished  gypsum board.  Building "wet" columns to be furred,  insulated
with high density sound insulation, and covered with 5/8" smooth finished gypsum
board.  Raco FS4MB black  recessed  reveal  molding to be used at connections of
columns to ceilings.

INTERIOR PARTITIONS -

Interior  partitions  shall extend from floor level to the  underside of ceiling
grid. Interior partitions shall be constructed using 3-5/8" metal studs and 5/8"
smooth  finished  gypsum board each side.  Raco FS4 black reveal header shall be
used at connection of walls to ceiling.




N-CREDEN-D.DOC/SKB/LMH/Exhibit D                                           5Oaks
4/10/98
Page 1 of 4                                                        Hillsboro, OR


<PAGE>

INSULATION -

3-1/2" unfaced fiberglass batt insulation shall be provided in walls surrounding
conference and lunch rooms.  Insulation  around private offices is excluded.  4'
wide, 3-1/2" unfaced fiberglass batt insulation shall be provided above ceiling,
centered above walls receiving insulation.

INTERIOR DOORS -

Interior doors shall be nominal 3'-0" by 9'-0" solid core ribbon sapele, stained
to a dark  cherry  wood finish  ("Building  Standard  Finish") in Timely II door
frames,  factory painted to approximate door color ("Building  Standard Frame").
Door  hardware to include 2 pair butts,  Schlage "AL" series (or similar)  lever
latch, and wall stop for each door. Door hardware finish to be polished brass.

RELITES -

Relites are not included for standard tenant  improvements.  When used,  relites
shall include 1/4" tempered glass in Timely II frames,  factory painted to match
door frames.

SUITE ENTRIES -

Suite entries are not applicable to this project.  When used,  suite entry shall
include a nominal  3'-0" by 9'-0"  solid core  ribbon  sapele  door,  stained to
Building  Standard Finish in Building  Standard Frame.  Door hardware to include
closer,  butts,  Schlage  "D" series (or  similar)  lever lock,  and stop.  Door
hardware  finish to be polished  brass.  Glass doors,  card entry  systems,  and
special access systems shall be supplied and installed by tenant.

FOLDING PARTITIONS AND OPERABLE WALLS -

Folding  partitions  and operable  walls are not  included  for standard  tenant
improvements.

ACOUSTICAL CEILINGS -

The acoustical  ceiling suspension system shall be installed in a 4' by 4' grid,
and ceiling tile and remaining tee's supplied under building shell construction.
Tenant area construction  includes installation of 2' by 2' tegular edge ceiling
tile  (Armstrong  Minatone #705  Fissured)  and necessary  tee's in the building
shell ceiling grid.

PAINTING -

All interior  walls shall receive  primer and two coats of finish  paint.  Paint
color is to match approved drawdowns.

WALL COVERING -

Vinyl,  fabric,  tile,  and other wall  coverings  are not included for standard
tenant improvements.

FLOOR COVERINGS -

Floor  covering  colors  shall be selected by Tenant  from  Landlord's  standard
finish  options.  Carpet shall be 30 oz. cut pile or 26 oz. level loop. Cut pile
carpet shall be installed on carpet pad.  Armstrong Exelon or equal VCT shall be
installed in lunch  rooms,  copy rooms,  storage  rooms,  and other  appropriate
locations.   Sheet  vinyl   flooring  is  not  included   for  standard   tenant
improvements.  Rubber base to be 4" in continuous lengths. Coved base to be used
in areas with resilient flooring; flat base to be used in carpeted areas. Quarry
or ceramic tiles, wood flooring, raised computer floors, and other special floor
finishes are not included for standard tenant improvements.

WINDOW COVERINGS -

Building Standard window covering  (off-white,  non-perforated,  vertical louver
blinds)  shall be provided at exterior  windows.  Window  coverings  on interior
relites are not included for standard tenant improvements.


N-CREDEN-D.DOC/SKB/LMH/Exhibit D                                           5Oaks
4/10/98
Page 2 of 4                                                        Hillsboro, OR


<PAGE>

CABINETS AND MILLWORK -

Cabinet work includes  lunch/break room upper and lower units and cabinets for a
work/copy room only.  Built-in desks,  shelving,  and furniture are not included
for standard  tenant  improvements.  Tenant cabinets to be constructed to A.W.I.
standards with plastic laminate tops,  fronts,  and sides,  color as selected by
Tenant  from  standard  high  pressure  laminates.  Cabinet  interiors  shall be
constructed  of melamine or standard low pressure  laminate.  Concealed  hinges,
heavy-duty drawer hardware,  and wire pulls shall be included for all drawers or
doors.  One (1) 4' x 4' plywood  phone board is included.  Wall  paneling,  wood
base,  shelving,  and other special millwork items are not included for standard
tenant improvements.

APPLIANCES -

Appliances such as dishwashers,  refrigerators, and microwave ovens, and vending
machines,  coffee  makers  or other  similar  equipment  shall be  supplied  and
installed by tenant.

FURNITURE AND ACCESSORIES -

Furniture,  coat hooks, desk partitions,  tack boards,  projection screens, fire
extinguishers  and  cabinets,  and  other  miscellaneous  accessories  shall  be
supplied and installed by tenant.

SIGNAGE -

Interior and exterior signage shall be supplied and installed by tenant.

PLUMBING -

Plumbing within a tenant space is not included for standard tenant improvements.
If tenant elects to have  plumbing,  it shall be connected to existing  plumbing
services.  Available tie-in locations include two (2) building "wet" columns and
the central utility room and rest room locations.  All above slab waste and vent
piping to be cast iron.  When used,  typical  lunch room sink to be Elkay CR2522
with Delta 100 faucet.

FIRE PROTECTION -

Fire  protection  system  shall be modified as required  for tenant  improvement
layout.  Building shell fire protection  system includes service to the building
and overhead sprinkler piping.  Tenant improvement fire protection work includes
the addition of "drops" to ceilings and chrome,  semi-recessed  sprinkler heads.
Special fire suppression  systems such as intergen or preaction  systems are not
included for standard tenant improvements.

H.V.A.C. -

Heating,  ventilation,  and air conditioning  systems shall be extended to serve
the tenant  improvement  layout.  The  building  shell  includes a closed  loop,
water-source  heat pump system with high  efficiency  cooling  tower and boiler.
System  includes DDC automated  control with central  panel  operation of energy
management  functions.  Modulating  outside air supply and exhaust is managed by
the DDC controller and ducted to and from each zone.  Supply and return air main
trunk ducts and main water loop  piping  shall be  provided  under the  building
shell HVAC work. Heat pumps,  thermostats,  duct extensions,  connections to the
water loop,  and supply and return air  diffusers  shall be added  under  tenant
improvement construction.  Tenant spaces to be connected to dedicated channel of
the DDC control  system with  programmable  override for after hour use.  Tenant
HVAC zones to be provided 1 each per approximate  1000 square feet. Each zone to
be  thermostatically  controlled.  Special  computer room,  conference room, and
lunch  room  cooling  and  ventilation  are not  included  for  standard  tenant
improvements.


-CREDEN-D.DOC/SKB/LMH/Exhibit D                                           5Oaks
4/10/98
Page 3 of 4                                                        Hillsboro, OR


<PAGE>

ELECTRICAL -

     Building  shell  electrical  work  includes  the main  building  electrical
     service  with wires in conduit to  electrical  distribution  panels on each
     floor.  Tenant  improvement  electrical  work  includes  breakers  in shell
     electrical  panels,  extension  of power  from the  electrical  room to the
     tenant space,  the addition of any tenant  subpanels  within the space, and
     furnishing and installation of lighting and power outlets.

     Lighting shall be provided  using 2' by 4' fluorescent  light fixtures with
     18-cell  parabolic  lenses.  Wattage available for lighting for each tenant
     space is governed by the State of Oregon Energy Code. Special architectural
     lighting (track lighting,  spot lighting,  down lights, wall sconces, etc.)
     and dual level switching are not included for standard tenant improvements.
     Lighting  lamps,  ballasts,  and  controls  shall  meet  electrical  energy
     consumption code requirements.  Duplex outlets shall be provided 1 each per
     120 square feet of Tenant area.

     Power  connections to Tenant desk partitions to be provided at wall, floor,
     or power pole locations only; wiring within desk partitions is not included
     for standard tenant  improvements.  Mud rings with pull strings to the area
     above  ceiling  shall be provided 1 each per 240 square feet of Tenant area
     for  Tenant  installed   telephone  and  data  wiring.   Cover  plates  and
     receptacles  for telephone and data wiring shall be provided by the Tenant.
     Generators, uninterruptable power supplies, and special electrical work for
     computer  and  phone   systems  are  not   included  for  standard   tenant
     improvements.

FIRE ALARM -

Fire alarm and smoke  detection  systems  shall be  provided  if required by the
local governing jurisdictions.

SECURITY SYSTEMS -

Security systems shall be provided and installed by tenant.

TELEPHONE AND COMPUTER SYSTEMS -

Telephone,  data, and computer system equipment and wiring shall be provided and
installed by tenant.
















N-CREDEN-D.DOC/SKB/LMH/Exhibit D                                           5Oaks
4/10/98
Page 4 of 4                                                        Hillsboro, OR

<PAGE>

                                  "EXHIBIT E"


                          CREDENCE SYSTEMS CORPORATION
                   BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                          OFFICE BUILDING (SPACE ONE)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - WEST ELEVATION AND PARTIAL SOUTH ELEVATION SECTIONS 1 & 2

<PAGE>

                                  "EXHIBIT E"


                          CREDENCE SYSTEMS CORPORATION
                   BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                          OFFICE BUILDING (SPACE ONE)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - EAST ELEVATION AND PARTIAL NORTH ELEVATION SECTIONS 1 & 2


<PAGE>

                                  "EXHIBIT E"


                          CREDENCE SYSTEMS CORPORATION
                   BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                          OFFICE BUILDING (SPACE ONE)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - FIRST FLOOR PLAN

<PAGE>

                                  "EXHIBIT E"


                          CREDENCE SYSTEMS CORPORATION
                   BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                          OFFICE BUILDING (SPACE ONE)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - SECOND FLOOR PLAN

<PAGE>


                                  "EXHIBIT E"


                          CREDENCE SYSTEMS CORPORATION
                   BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                          OFFICE BUILDING (SPACE ONE)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - THIRD FLOOR PLAN


<PAGE>

                                  "EXHIBIT F"


                          CREDENCE SYSTEMS CORPORATION
                    BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                WAREHOUSE AND MANUFACTURING BUILDINGS (SPACE TWO)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - SOUTH ELEVATION BLDG. 306
Plan diagram - SOUTH ELEVATION BLDG. 306

<PAGE>


                                  "EXHIBIT F"


                          CREDENCE SYSTEMS CORPORATION
                    BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                WAREHOUSE AND MANUFACTURING BUILDINGS (SPACE TWO)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - WEST ELEVATION BLDG. 305 AND 306
Plan diagram - EAST ELEVATION BLDG. 305 AND 306

<PAGE>


                                  "EXHIBIT F"


                          CREDENCE SYSTEMS CORPORATION
                    BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                WAREHOUSE AND MANUFACTURING BUILDINGS (SPACE TWO)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - FLOOR PLAN BUILDING 305

<PAGE>


                                  "EXHIBIT F"


                          CREDENCE SYSTEMS CORPORATION
                    BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                WAREHOUSE AND MANUFACTURING BUILDINGS (SPACE TWO)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - FLOOR PLAN BUILDING 306



<PAGE>

                                 LEASE AMENDMENT



DATED:     April 17, 1998

BETWEEN:   PACIFIC REALTY ASSOCIATES, L.P.,
           a Delaware limited partnership                              LANDLORD

AND:       CREDENCE SYSTEMS CORPORATION,
           a California corporation, hereinafter referred to as          TENANT



          By written  lease dated  April 10,  1998,  Tenant leased from Landlord
total  of  approximately  183,315 square  feet of  warehouse  and  office  space
comprised of approximately 71,265 square feet of office space located in a three
(3) story office building ("Space One") and approximately 112,050 square feet of
warehouse and  manufacturing  space  located in two (2)  connected  single story
buildings  ("Space Two")  located at Five Oaks West Business  Park, on Pine Farm
Road in Hillsboro,  Oregon (and generally as located on the attached Exhibit A).
Such  document is  hereinafter  referred to as the  "Lease."  The Lease  expires
March 31, 2014.

          Tenant now wishes to amend the Lease.

          NOW, THEREFORE, the parties agree as follows:

          1. Exhibit A shall be modified by the new Exhibit A which is attached
hereto.

          2. On Exhibit C,  the paragraph titled "SITEWORK" shall be modified to
include the following language:  "ASPHALT PAVING: 2-1/2" of asphalt paving shall
be provided over 6" crushed rock base in automobile  traffic and parking  areas,
and 3" of asphalt  paving  shall be provided  over 9" crushed rock base in truck
loading dock and maneuvering areas in accordance with the  recommendation of the
geotechnical engineer."

          3. On  Exhibit C,  the  paragraph  titled  "BUILDING  SHELL"  shall be
modified  to  include  the  following  language:  "CONCRETE  SLAB ON GRADE:  The
concrete  slab  on  grade  shall  be  5"  thick,   unreinforced  concrete,  with
compressive strength design of 3000 psi at 28 days. Seismic reinforcing steel is
included along the building perimeter if required by code.  Interior floor slabs
to be smooth trowel finished."

          4. The  following  language  shall be included in  Exhibit C:  "TENANT
IMPROVEMENTS - FLOOR SLAB RECESS:  A recessed floor slab shall be constructed if
requested by Tenant in the location  indicated on the attached C-1. The finished
surface of the  recessed  floor shall be 12" maximum  below the  adjacent  floor
surfaces. The recessed floor will be 5" thick, unreinforced concrete with smooth
trowel  finish.  Raised  floor  systems  are  not  included.   Tenant  shall  be
responsible for the cost of filling in the recess with smooth finished  concrete
upon lease termination or earlier vacation of the premises."

          5.  Paragraph  6.2.  shall  be  deleted  and  the  following  language
substituted:  "Tenant shall carry general  liability  insurance on an occurrence
basis with combined  single limits of not less than  $1,000,000.  Landlord shall
have the right to require  Tenant to increase this minimum  liability  insurance
limit by such  reasonable  amounts  as may be  required  to  adequately  protect
Landlord and Tenant in the future as a result of general  increases in liability
awards in the courts but in no event shall Landlord be allowed to require Tenant
to carry more than  $5,000,000 of liability  insurance.  Such insurance shall be
provided by an insurance carrier reasonably  acceptable to Landlord and shall be
evidenced by a certificate  delivered to Landlord stating that the coverage will
not be canceled or materially  altered  without ten (10) days'  advance  written
notice to Landlord.  Landlord  shall be named as an  additional  insured on such
policy,   but  only  with  respect  to  the  indemnity   granted  by  Tenant  in
Paragraph 6.1 above."

          6. Except as expressly  modified hereby,  all terms of the Lease shall
remain in full force and effect and shall continue through the existing term.



N-CREDENCE.DOC/SKB/LMH                                      5Oaks/304, 305 & 306
4/17/98
Page 1 of 2                                                        Hillsboro, OR


<PAGE>

          IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the respective dates set opposite their signatures  below, but this Agreement on
behalf of such  party  shall be deemed to have been  dated as of the date  first
above written.

                                 LANDLORD:

                                 PACIFIC REALTY ASSOCIATES, L.P.,
                                 a Delaware limited partnership

                                 By:   PacTrust Realty, Inc.,
                                       a Delaware corporation,
                                       its General Partner

          4/22                           /s/ SAM K. BRIGGS
Date:  -------------, 1998       By: ----------------------------------
                                       Sam K. Briggs
                                       Vice President



                                 TENANT:

                                 CREDENCE SYSTEMS CORPORATION,
                                 a California corporation


          APRIL 20                        /s/ W.R. BOTTOMS
Date:  --------------, 1998      By: ----------------------------------
                                 Name:  W.R. Bottoms
                                 Title: CEO










N-CREDENCE.DOC/SKB/LMH                                      5Oaks/304, 305 & 306
4/17/98
Page 2 of 2                                                        Hillsboro, OR

<PAGE>


                                  "EXHIBIT C-1"


                          CREDENCE SYSTEMS CORPORATION
                    BUILDING SHELL FLOOR PLANS AND ELEVATIONS
                WAREHOUSE AND MANUFACTURING BUILDINGS (SPACE TWO)
                          FIVE OAKS WEST BUSINESS PARK


Plan diagram - FLOOR PLAN BUIDLING 306







N-CREDEN-F.doc / SKB / LMH /Exhibit C-1                                    5Oaks
5/20/98
Page 1 of 1                                                        Hillsboro, OR