EXHIBIT 10.2

September 12, 2002

CONFIDENTIAL

Mr. Kevin T. Longe
15451 Village Drive
Lake Oswego, OR 97034

Re: Separation Agreement

Dear Kevin:

        As we have discussed, your employment with Electro Scientific
Industries, Inc. (“ESI” or the “Company”) has terminated effective at the close
of business on Septemebr 9, 2002 (the “Separation Date”). On the Separation Date
you were provided your final paycheck including pay for all accrued, unused or
otherwise unpaid vacation along with an earlier draft of this letter. This
letter supecedes the letter delivered to you on the Separation Date in its
entirety.

        In order to help you to transition to your next opportunity, the terms
of a Separation Agreement (the “Agreement”) are described below. Under this
Agreement, if you choose to accept it, you would receive severance compensation
of $125,000 (subject to applicable withholding) over the next 4 months as set
out below; and you would agree to the terms described below which include a
general release of claims.

A. Separation Agreement

1. Resignation

        By executing this Agreement, you resign your position as Vice
President-Sales, Marketing and Service and as an officer of ESI or any
affiliated company of ESI effective September 9, 2002.

2. Severance Pay

        If you accept the terms of this Agreement, you will receive severance
pay equivalent to $125,000 subject to taxes and other applicable withholding.
Payments will be made on regular Company paydays during this period (the
“Severance Period”) and end on the last Company payroll date prior to December
31, 2002

3. Benefits

  3.1 Health and Dental Benefits

        Your regular health and dental coverage will continue through September
30, 2002. As you may know, pursuant to COBRA, a federal law, you may, if
eligible, continue your group health benefits for a period of eighteen (18)
months from termination of your employment at your sole expense. Subject to the
terms of this Agreement, the Company will pay your COBRA premiums for coverage
through February 28, 2003, or until you find other employment through which you
are eligible receiving group medical health insurance coverage, which happens
first.

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Mr. Kevin T. Longe
September 12, 2002
Page – 2

You agree to immediately notify the Company in writing upon obtaining such other
employment during the Severance Period. You will receive additional information
explaining rates and your options under COBRA in separate correspondence.

  3.2 Other Qualified and Non-Qualified Plans and Programs

Except for health and dental benefits described above, effective upon your
execution of this Agreement, you will cease participation in all benefit plans
and programs of the Company, including, but not limited to, vacation and sick
leave programs and all employee stock programs.

  3.3 Stock Options and Grants

        Your rights under the Company’s Stock Incentive Plans with respect to
stock options and stock grants shall be as stated in the plan documents or
related agreements. For purposes of stock option vesting and exercise your
termination date will be the Separation Date. Please refer to the stock option
agreements and stock option plans previously provided to you for details on your
right to exercise currently vested stock options.

3.3 Deferred Compensation

        You will receive all amounts owed to you under the Company’s Deferred
Compensation Plan (subject to applicable taxes and withholding) in accordance
with the terms of the plan documents.

  3.4 No Other Benefits

        You will not receive any other employee benefits except those specified
herein. You acknowledge that you have no vested retirement benefits under any
retirement plan or agreement based on your service to the Company. You agree to
waive the right to participate in any Company employee benefit plan and to
receive other fringe benefits or separation benefits from ESI.

4. Release of Claims

        In consideration for these separation benefits you agree to fully
release the Company and its subsidiaries, related corporations, affiliates and
joint ventures, partnerships, predecessor and successor organizations and all
current and former partners, members, joint venturers, officers, directors,
employees, agents, insurers, shareholders, representatives and assigns from any
and all liability, damages or causes of action, direct or indirect, known or
unknown including, without limitation, all claims relating in any way to your
employment with the Company or the termination of that employment. This release
includes, but is not limited to, any claims for additional compensation,
benefits or wages in any form, damages, reemployment or reinstatement. This
release also includes, but is not limited to, all claims for relief or remedy
under any state or federal laws, including ERISA, 29 USC § 1001 et seq.,
Title VII of the Civil Rights Act of 1964, 42 USC § 2000e as amended, the Post
Civil War Civil Rights Acts, 42 USC §§ 1981-88, the Civil Rights Act of 1991,
the Equal Pay Act, the Age Discrimination in Employment Act, the Americans With
Disabilities Act, the Older Workers’ Benefit Protection Act, the Federal Family
and Medical Leave Act, the Worker Adjustment and Retraining Notification Act,
the Rehabilitation Act of 1973, the Uniformed Services Employment and
Reemployment Rights Act, the Fair Labor Standards Act, Executive Order 11246,
and all other laws and contract, tort or other common or statutory law theories
and all labor, employment or wage laws of Oregon or any other state.

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Mr. Kevin T. Longe
September 12, 2002
Page – 3

5. Voluntary Release

        You acknowledge that you have read the Agreement and understand that you
are releasing legal rights, including those identified in the release of claims
set forth above. You also acknowledge that, as consideration for executing this
Agreement, including the release of claims, you are receiving additional
benefits and compensation to which you would not otherwise be entitled. You are
advised that you may choose to seek review and advice regarding this Agreement
from an attorney.

6. Confidentiality and Non-Competition

  6.1 Preservation and Non-Use of Confidential Information

You agree not to discuss this Agreement except with your financial, tax, and
legal advisors and with members of your family, and not to discuss Confidential
Information obtained during your employment with the Company. For purposes of
this Agreement, “Confidential Information” means any and all confidential or
proprietary information concerning the Company or its affiliates, joint
venturers or other related entities, the disclosure of which could disadvantage
ESI or which derives value from the fact that it is not publicly known.
Confidential Information includes trades secrets as defined under the Uniform
Trades Secrets Act.

        You agree not to use Confidential Information, during the term of this
Agreement or after its termination, for any personal or business purpose, either
for your own benefit or that of any other person, corporation, government or
other entity.

        You also agree that you will not disclose or disseminate any
Confidential Information, directly or indirectly, at any time during the term of
this Agreement or after its termination, to any person, agency, or court unless
compelled to do so pursuant to legal process (e.g., a summons or subpoena) or
otherwise required by law and then only after providing the Company with prior
notice and a copy of the legal process.

  6.2 Non-Competition

        You agree that you will not for a period through September 9, 2003,
directly or indirectly, accept employment or enter into any business
relationship of any sort whatsoever (including, but not limited to, as a
consultant, vendor, partner, officer or director, but excluding passive stock
investments) with any customer or competitor of the Company or any entity with
which the Company has done business or with whom you know the Company intends to
do business within the twelve (12) months following the Separation Date. You
specifically acknowledge and agree that the terms of this provision are
reasonable in every respect and, in particular, because of the competitive and
specialized nature of the Company’s business, that it is reasonable not to
include any geographic limitation in this provision.

7. Dispute Resolution

        This Agreement shall be construed in accordance with and governed by the
statutes and common law of the state of Oregon. Any disputes arising in
connection with the terms or enforcement of this Agreement shall be resolved by
confidential mediation or binding arbitration in accordance with the procedures
of the American Arbitration Association or other procedures agreed upon by you
and the Company. The costs of mediation and arbitration shall be borne equally
by you and the Company.

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Mr. Kevin T. Longe
September 12, 2002
Page – 4

8. Acknowledgement

        You acknowledge that this Agreement contains the entire agreement and
understanding between you and the Company and supersedes and replaces all prior
negotiations and agreements concerning the subjects of this Agreement. You
acknowledge that (a) you have read the Agreement and understand the effect of
your release and that you are releasing legal rights; (b) you have had adequate
time to consider this Agreement (as set out below); (c) as consideration for
executing this Agreement, you have received additional benefits and compensation
of value to which you would not otherwise be entitled; and (d) you have been,
and hereby are, advised in writing to review this Agreement with legal counsel
of your choice.

9. Time for Consideration of Offer and Agreement

        You acknowledge that the Company provided you this Agreement on
September 13, 2002 and that this offer provided you with a period of twenty-one
(21) days from the date of receipt for your consideration of the offer (the
“consideration period”). In the event you have not executed this Agreement by
the expiration of the offer period on October 4, 2002, the offer shall expire.
You may execute this Agreement at any time during this consideration period.
This Agreement shall be effective on the date it is signed.

Sincerely,

ELECTRO SCIENTIFIC INDUSTRIES, INC.

By:  GARY M. KAPRAL
        ——————————————
        Gary M. Kapral
        Vice President

        I have read and understand the foregoing Agreement and, by signing
below, I voluntarily enter into this Agreement and understand that I am waiving
and releasing legal claims that I may have against the Company.

Accepted: September 18, 2002

Kevin T. Longe

/s/ KEVIN T. LONGE
———————————
Signature

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