EXHIBIT 10.34

AMENDMENT NO. 2

TO

LICENSE AGREEMENT

BETWEEN

MAYO FOUNDATION FOR MEDICAL EDUCATION AND RESEARCH

AND

ENTEROMEDICS, INC.

This Amendment No. 2 (the “Amendment No. 2”) is entered into as of January 4,
2011 (the “Execution Date of Amendment No. 2”) by and between Mayo Foundation
for Medical Education and Research, a Minnesota charitable corporation, located
at 200 First Street SW, Rochester, Minnesota 55905-0001 (“MAYO”), and
EnteroMedics, Inc., a private for-profit corporation located at 2800 Patton
Road, Roseville, Minnesota 55113 (“COMPANY”) and amends that certain License
Agreement by and between MAYO and COMPANY with an Effective Date as of
February 3, 2005 (the “License Agreement”) and Amendment No. 1 to the License
Agreement with an Execution Date of February 3rd, 2010 (“Amendment No. 1”) with
the effect of amending, restating and replacing the following provisions in
their entirety with the text set forth below:

2.02 MAYO KNOW-HOW COMMITMENT. For a period of five (5) years from the Effective
Date for the Obesity Device Group and the Vagal Blocking Device Group and for a
period of two (2) years from the Execution Date of Amendment No. 1 for Michael
Camilleri, M.D., Michael Sarr, M.D. and Michael Kendrick of the Phase II Mayo
Group and until December 31st, 2010 for William Sandborn, M.D. of the Phase II
Mayo Group, unless terminated earlier by either COMPANY or MAYO as provided for
in this Agreement, MAYO commits to the following:

 

(a) Subject to existing obligations to third parties, MAYO policies and for so
long as its members are employees of MAYO, the Obesity Device Group shall confer
with the COMPANY in the Field as follows: (i) exclusively for Product
Development for devices to treat obesity and nonexclusively for Product Testing;
and (ii) non-exclusively for Product Development and Product Testing with
COMPANY for Vagal Devices to treat gastrointestinal disorders other than obesity
(for example, pancreatitis and irritable bowel syndrome) and excluding obesity.

 

(b) Subject to existing obligations to third parties, MAYO policies and for so
long as its members are employees of MAYO, the Vagal Blocking Device Group shall
confer exclusively with the COMPANY for Product Development and nonexclusively
for Product Testing, all for Vagal Devices.

 

(c) Subject to existing obligations to third parties, MAYO policies and for so
long as its members are employees of MAYO, the Phase II Mayo Group shall confer
with the COMPANY in the Field as follows: (i) exclusively for Product
Development for devices to treat obesity and nonexclusively for Product Testing;
and (ii) non-exclusively for Product Development and Product Testing with
COMPANY for Vagal Devices to treat gastrointestinal disorders other than
obesity.

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(d) Subject to existing obligations to third parties, MAYO hereby grants COMPANY
a royalty-bearing, worldwide license to use the Know-How in the Field to
develop, make, use and sell COMPANY Products as provided below:

1. With respect to Obesity Device Group Know-How for:

 

  (a) Product Development, such license shall be exclusive for obesity devices
and non-exclusive for Vagal Devices for treating conditions other than obesity;
and

 

  (b) Product Testing, such license shall be non-exclusive.

2. With respect to the Vagal Blocking Device Group Know-How for:

 

  (a) Product Development, such license shall be exclusive; and

 

  (b) Product Testing, such license shall be non-exclusive.

3. With respect to the Phase II Mayo Group Know-How for:

 

  (a) Product Development, such license shall be exclusive for devices to treat
obesity and nonexclusive for Vagal Devices for treating other conditions other
than obesity; and

 

  (b) Product Testing, such license shall be non-exclusive.

COMPANY shall have the right to sublicense such know-how, but not any obligation
of MAYO to confer, on the same terms and conditions as set forth above with
respect to Licensed Patents.

 

(e) MAYO represents and warrants that to the best of internal patent counsel’s
knowledge as of the Effective Date and without a duty to inquire, MAYO is not
aware of any existing third party obligations that will materially interfere
with the Obesity Device Group, the Vagal Blocking Device Group or the Phase II
Mayo Group from conferring with COMPANY under Section 2.02, in accordance the
terms and conditions of this Agreement.

Each member of the Obesity Device Group, the Vagal Blocking Device Group and the
Phase II Mayo Group shall use reasonable efforts to attend meetings, achieve
specific Product Development objectives and milestones, and conduct Product
Testing, contributing on average among the individuals of the groups between 3-6
person hours per month as requested by COMPANY. Any time credited under this
Section shall not also be subject to compensation under any other agreement
including any agreement referenced under Section 3.14 of this Agreement.

3.06 KNOW-HOW RETAINER FEES: The COMPANY shall pay MAYO a minimum annual
retainer fee of One Hundred and Seventy-Five Thousand Dollars (US$175,000) for
the Obesity Device Group as partial compensation for its Know-How

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as specified in the payment schedule below. The COMPANY shall also pay MAYO an
additional minimum annual retainer fee of Seventy-Five Thousand Dollars
(US$75,000) for the Vagal Blocking Device Group as partial compensation for its
Know-How as specified in the payment schedule below. In 2010, the COMPANY shall
pay MAYO a minimum retainer fee of One Hundred Thousand Dollars (US$100,000) and
in 2011 Seventy-Five Thousand Dollars (US$75,000) for the Phase II Mayo Group as
partial compensation for its Know-How as specified in the payment schedule
below. The following payments shall be made within ten (10) days of the dates
listed:

 

Date

  

Retainer fee payment due MAYO

a) The Effective Date    One Hundred Twenty-Five Thousand Dollars (US$125,000);
b) November 1, 2005    One Hundred Twenty-Five Thousand Dollars (US$125,000); c)
January 1, 2006    One Hundred Twenty-Five Thousand Dollars (US$125,000); d)
July1, 2006    One Hundred Twenty-Five Thousand Dollars (US$125,000); f)
January 1, 2007    Two Hundred Fifty Thousand Dollars (US$250,000); g)
January 1, 2008    Two Hundred Fifty Thousand Dollars (US$250,000); h)
January 1, 2009    Two Hundred Fifty Thousand Dollars (US$250,000); i)
February 15, 2010    One Hundred Thousand Dollars (US$100,000); and j)
January 1, 2011    Seventy-Five Thousand Dollars (US$75,000).

3.15 Phase II Mayo GROUP MILESTONE PAYMENT. COMPANY shall pay MAYO Two Hundred
and Fifty Thousand Dollars (US$218,750) within twelve months after the first
commercial sale of the first Company Product after receipt of FDA approval for
such Company Product for providing Phase II Mayo Group Know-How; provided, that
if MAYO exercises its right to terminate the Phase II Mayo Group’s obligations
pursuant to Section 6.04(b), such payment shall be reduced to equal the product
of (i) the number of months that have elapsed since the Execution Date of this
Amendment No. 1 through the effective date of such termination, divided by
twenty-four (24), multiplied by (ii) $218,750 (in which case, it is agreed that
such payment shall not be due until twelve months after the first commercial
sale of the first Company Product after receipt of FDA approval for such Company
Product). It is a material breach of this agreement if such payment is not
received within ninety (90) days of achieving the milestone.

Except as expressly amended by this Amendment No. 2, all terms and conditions of
the License Agreement as previously amended by Amendment No. 1 shall remain in
full force and effect.

 

MAYO FOUNDATION FOR MEDICAL EDUCATION AND RESEARCH     ENTEROMEDICS, INC. By:  

/S/    STEVEN P. VAN NURDEN

    By:  

/S/    MARK B.KNUDSON, PH.D.

Name:   Steven P. Van Nurden     Name:   Mark B. Knudson Title:   Assistant
Treasurer     Title:   President and CEO Date:  

01-19-2011

    Date:  

1-17-2011