**EXHIBIT 10.29**

**CONSULTING AGREEMENT**

This Consulting Agreement (this“Agreement”) is entered into as of October 1, 2010 (the “Effective Date”), by and between EnteroMedics Inc. (the “Company”), a Delaware corporation, whose principal place of business is 2800 Patton Road, St. Paul,MN 55113, and Augustus Advisors, Inc. (the “Consultant”), whose address is 405 Alan Road Santa Barbara, CA, 93109. 

WHEREAS, the Consultant currently serves as a member of the Company’s Board of Directors; 

WHEREAS, the Company desires that the Consultant provide additional services to the Company as an independent contractor and theConsultant desires to provide such additional services as an independent contractor. 

NOW, THEREFORE, in consideration of themutual representations, promises and agreements contained herein, the adequacy and sufficiency of which are hereby acknowledged, the Company and the Consultant hereby agree as follows: 

1. Term of Agreement. The Company hereby engages the Consultant as a consultant, subject to the terms and conditions hereof, forthe period commencing as of the Effective Date and ending on January 31, 2011 (the “Term”), except as the Term may be extended by mutual written agreement of the parties hereto or earlier terminated as hereafter provided. The periodduring which the Consultant is performing services under this Agreement shall be referred to herein as the “Consulting Period.” 

2. Consulting Services. During the Consulting Period, the Consultant shall perform consulting services for the Company. Such consulting services are anticipated to include, but not limited to,working with Company management at a strategic level with respect to the Company’s commercialization planning, business and corporate development activities and investor relations. During the Term, the Consultant will devote up to 10 hours permonth to accomplishing his duties and responsibilities under this Agreement. Consultant shall make himself available in person for meetings and consultation with Company employees at the Company’s headquarters in St. Paul, Minnesota uponreasonable request. Consultant’s principal contact at EnteroMedics shall be Mark B. Knudson, Ph.D., and Consultant shall accept instructions/directions from and report to this contact person or any other designee specified by Dr. Knudson.Consultant must receive approval from Dr. Knudson before working more than 10 hours per month. 

3. IndependentContractor.

(a) The Consultant shall perform the consulting services described in Section 2 as an independentcontractor without the power to bind or represent the Company for any purpose whatsoever. Nothing herein contained shall be construed to constitute the parties hereto as partners or as joint venturers, or either as agent of the

other, or as employer and employee. The Consultant shall not present himself as an employee of the Company or any of its affiliates. 

(b) The Consultant shall not be entitled to participate in any employee benefit plans maintained by on behalf of the Company or any ofits affiliates during the Consulting Period. The Consultant hereby acknowledges his separate responsibility for all federal and state unemployment compensation taxes and business license fees, if applicable. 

4. Compensation.

(a) Consulting Fee. In remuneration for the consulting services to be performed under this Agreement by the Consultant during the Consulting Period, the Consultant shall receive a consulting feeequal to $175.00 an hour (the “Consulting Fee”). The Consulting Fee shall be in addition to, and not in lieu of, those fees or other remuneration to which the Consultant may be entitled pursuant to Company policies in his position asmember of the Board of Directors. Prior equity awards granted on or before February 8, 2010 will continue to vest in accordance with the terms of that equity award. 

5. Expenses. The Company will reimburse Consultant for actual incidental expenses (with no increase for handling or other mark-up) incurred in performing this Agreement, but such expenses shall notexceed one hundred dollars ($100) per month without the Company’s prior written consent. Travel expenses must be approved in advance by the Company. Consultant shall provide the Company with appropriate documentation for tax purposes for allexpenses paid by the Company. Consultant shall submit monthly invoices for time and expenses. 

6. Termination. Duringthe Term, this Agreement and the Consulting Period may be terminated at any time by the Company or the Consultant, with or without cause, upon thirty (30) days’ prior written notice to the other party. The Agreement may be terminated bythe Company immediately for any willful breach by Consultant of this Agreement or any willful misconduct or malfeasance by Consultant that may be detrimental or harmful to the Company. In the event of the termination of this Agreement pursuant tothis Section 6, the Company’s obligations under Section 4(a) shall cease on the effective date of such termination. In the event of the Consultant’s death or permanent disability, the Agreement and Consulting Period shallterminate. The provisions of this Section 6, as well as Sections 7, 8, 9 and 15 shall survive the expiration or termination of this Agreement and shall remain in full force and effect in accordance with the terms thereof. 

7. Exclusivity. Due to the confidential nature of the information which will be disclosed to Consultant in connection with hisperformance of the consulting services under this Agreement, Consultant shall not do any other consulting work for any other third party in the area of the Company’s products, services or Technology or for any competitor or potential competitorof the Company during the Term and for a period of six months thereafter without prior approval by the Company. The Company’s 

“Technology” shall include the Company’s proprietary VBLOCTM, vagal blocking therapy, and Maestro TM System or any similar device or related processes, products or servicesrelated to obesity management or treatment of gastrointestinal disorders, including, without limitation, the use of neuroblocking or neurostimulation to treat obesity, its associated co-morbidities, metabolic syndrome and gastrointestinal disorders.

8. Confidential Information; Non-Solicitation. The parties hereto recognize that a major need of the Company is topreserve its specialized knowledge, trade secrets, and confidential information. The strength and good will of the Company is derived from the specialized knowledge, trade secrets, and confidential information generated from experience with theactivities undertaken by the Company. The disclosure of this information and knowledge to competitors would be beneficial to them and detrimental to the Company. The Consultant acknowledges that the proprietary information, observations and dataobtained by him during the Consulting Period concerning the business or affairs of the Company are the property of the Company. By reason of being a member of the Company’s Board of Directors and through the services provided under thisAgreement, the Consultant has or will have access to, and has obtained or will obtain, specialized knowledge, trade secrets and confidential information about the Company’s operations. Therefore, the Consultant hereby agrees as follows,recognizing that the Company is relying on these agreements in entering into this Agreement: 

(a) The Consultant will not use,disclose to others, or publish or otherwise make available to any other party any inventions or any Confidential Information about the affairs of the Company, including but not limited to confidential information concerning the results of theCompany’s clinical trials and financial condition. “Confidential Information” shall include any information considered by the Company to be confidential and/or proprietary that is disclosed by the Company to Consultant, allconfidential information of third parties that is to be held as confidential by the Company, commercial or trade secrets about Company’s proprietary Technology, products, devices and methods, as well as information about the Company’sengineering designs, plans and standards, commercial plans, sales and marketing plans, techniques and reports, analytical techniques, technical information, employee information, or financial and business records, any of which contains proprietaryinformation created or acquired by the Company and which information is held in confidence by Company. Confidential Information does not include information which: (i) becomes generally available to the public, unless said ConfidentialInformation was disclosed in violation of a confidentiality agreement; or (ii) becomes available to the Consultant on a non-confidential basis from a source other than the Company or its agents, provided that such source is not bound by aconfidentiality agreement with the Company or has not breached a duty of confidentiality to the Company in disclosing such information. 

(b) During the Term and for twelve (12) months thereafter, the Consultant will not directly or indirectly through another entity (i) induce any employee of the Company to leave theCompany’s employ (unless the Board of Directors shall have authorized such employment and the Company shall have consented thereto in writing) or in any way interfere with the relationship between the Company and any employee

thereof or (ii) tortuously interfere with the Company’s business relationship with any supplier, customer, vendor, clinical trial sponsor or other business relation of the Company.

9. Intellectual Property; Works of Authorship. 

(a) Consultant agrees to disclose promptly to the Company all inventions, improvements, know-how, formulas, trade secrets, secretprocesses, technical information, or any other intellectual property (other than works of authorship) made or conceived, either alone or jointly with others, during the term of this Agreement and for six (6) months thereafter as a result of theservices provided pursuant to this Agreement or of the Confidential Information obtained by Consultant during the term of this Agreement or any extension thereof. Consultant agrees that the Company shall be the exclusive owner of the entire right,title, and interest in and to any and all such intellectual property, including any patent applications and any patents that may issue therefrom anywhere in the world. Consultant agrees to assign all right, title, and interest in and to suchintellectual property to the Company without further payment from the Company. Consultant also agrees that, upon the Company’s request and at the Company’s expense, Consultant will provide reasonable assistance to the Company inprosecuting, maintaining, and protecting patents covering any such intellectual property. 

(b) Any original work of authorshipincluding any written, pictorial, graphic or audiovisual work, sound recording, courseware design or architecture in any form including, but not limited to, computer generated files and code, created by the Consultant in the course of providingservices to the Company under this Agreement shall be deemed as “works made for hire” and be the sole property of the Company and the Company shall own all the rights including the rights to copyright in the work. To the extent that any ofthe foregoing does not qualify as a “work made for hire,” Consultant hereby irrevocably transfers, assigns and conveys the exclusive copyright ownership thereof to the Company, free and clear of any liens, claims or other encumbrances, tothe fullest extent permitted by law. Consultant agrees to execute all documents and perform all acts that the Company may reasonably request in order to assist the Company in perfecting its rights in and to the works developed under this Agreementanywhere in the world. The Company will reimburse Consultant for any expenses reasonably incurred by Consultant in so doing. 

(c) The obligations to assign inventions and copyrights to the Company shall not apply to any invention or copyrights for which noequipment, supplies, facility or trade secret information of the Company was used and which was developed entirely on the Consultant’s own time, and (1) which does not relate (a) directly to the business of the Company or (b) tothe Company’s actual or demonstrably anticipated research or development, or (2) which does not result from any work performed by the Consultant for the Company. 

10. Entire Agreement. This Agreement sets forth the entire agreement and 

understanding of the parties hereto with respect to the matters covered hereby and supersedes any prior agreement or understanding whether oral or written between the parties with respect to thematters covered hereby. Nothing in this Agreement shall be construed to grant Consultant any right of service on the Company’s Board of Directors or committee thereof. 

11. Notices. All notices required or permitted by this Agreement shall be in writing and may be delivered in person, sent by certified or registered mail, return receipt required, postage paid tothe addresses stated above or to such other address as either party may designate or by facsimile to such facsimile number as either party may designate. All mailing notices shall be deemed effective upon depositing in the mail. 

12. Waiver. The waiver of either party of a breach of any provision of this Agreement shall not operate as or be construed as acontinuing waiver or as a consent to or waiver of such subsequent breach. 

13. Modification. This Agreement may only bemodified in writing signed by both parties. 

14. Nonassignable. Since the consulting services to be provided under thisAgreement are personal, all duties to be performed by Consultant may not be assigned to any other individual or third party without the written consent of the Company. 

15. Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Minnesota, without regard to its principles of conflicts of laws. ANY RIGHTTO TRIAL BY JURY WITH RESPECT TO ANY CLAIM, ACTION, SUIT OR PROCEEDING ARISING OUT OF THIS AGREEMENT OR ANY OF THE MATTERS CONTEMPLATED HEREBY IS WAIVED BY THE COMPANY AND CONSULTANT. THE COMPANY AND CONSULTANT HEREBY SUBMIT TO THE EXCLUSIVEJURISDICTION OF THE FEDERAL AND STATE COURTS LOCATED IN HENNEPIN COUNTY, MINNESOTA, IN CONNECTION WITH ANY DISPUTE RELATED TO THIS AGREEMENT OR ANY OF THE MATTERS CONTEMPLATED HEREBY. 

16. Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provisionshall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms. 

17. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original andall of which together shall constitute one and the same instrument. 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and yearfirst above written. 

 
 ENTEROMEDICS, INC.By: 
/s/    MARK B. KNUDSON,PH.D.
Name: Mark B. Knudson, Ph.D.Title: President and Chief Executive Officer CONSULTANT 
/s/    NICHOLAS L. TETI,JR.
         Augustus Advisors, Inc.