(e) On March 31, 2008, Replidyne, Inc. (the “Company”) entered into retention bonus agreements with each of Donald Morrissey and Mark Smith (the “Retention Bonus Agreements”).

The Retention Bonus Agreements provide that Messrs. Morrissey and Smith are each eligible to earn both (i) a cash bonus in the amount of $100,000 (the “September Bonus”), provided that such employee remains employed by the Company through September 30, 2008, and (ii) a cash bonus in an amount of not less than $100,000 and not greater than $150,000, which final amount will be determined by the Board of Directors of the Company in its sole discretion, provided that such employee remains employed by the Company through the consummation of a strategic transaction. For purposes of the Retention Bonus Agreements, a strategic transaction is defined as, subject to the sole discretion of the Board of Directors of the Company, (i) a strategic alliance or partnership with an unaffiliated third party that relates to the development and commercialization of faropenem medoxomil or (ii) another strategic transaction to which the Company is a party.

In the event that the employment of Messrs. Morrissey or Smith with the Company is terminated by the Company without cause (as defined in such employee’s employment agreement with the Company) or by such employee for good reason (as defined in such employee’s employment agreement with the Company) prior to September 30, 2008, such employee will become entitled to the September Bonus.

The term of the Retention Bonus Agreements extends until the later to occur of (i) September 30, 2008 and (ii) ten days following the consummation of a strategic transaction, provided that the Company has made all required payments thereunder.

The Retention Bonus Agreements do not affect the terms of the employment agreements that the Company has entered into with each of Messrs. Morrissey and Smith, which remain in full force and effect.

Item 9.01		Financial Statements and Exhibits.

(d) Exhibits.

Exhibit		Description
10.1		Retention Bonus Agreement dated March 31, 2008 by and between the Company and Mark Smith
10.2		Retention Bonus Agreement dated March 31, 2008 by and between the Company and Donald Morrissey