Assumption Agreement and First Amendment to Loan And Security Agreement

Exhibit 10.4

Assumption Agreement and First Amendment

to

Loan And Security Agreement

THIS ASSUMPTION AGREEMENT AND FIRST AMENDMENT to Loan and Security Agreement (this “Amendment”) is entered into as of February 25, 2009, by and between SILICON VALLEY BANK (“Bank”), CARDIOVASCULAR SYSTEMS, INC. (formerly known as Replidyne, Inc.), a Delaware corporation, for itself and as successor to Existing Borrower (“Successor Borrower”), whose address is 651 Campus Drive, Saint Paul, MN 55112, and CSI MINNESOTA, INC. (formerly known as Cardiovascular Systems, Inc.), a Minnesota corporation (“Existing Borrower”), whose address is 651 Campus Drive, Saint Paul, MN 55112. (Successor Borrower and Existing Borrower are referred to herein, jointly and severally, as “Borrower”.)

Recitals

      A.  Bank and Existing Borrower have entered into that certain Loan and Security Agreement dated September 12, 2008 (as the same may from time to time be amended, modified, supplemented or restated in writing, the “Loan Agreement”).

      B.  Bank has extended credit to Existing Borrower for the purposes permitted in the Loan Agreement.

      C.  Existing Borrower and Successor Borrower have advised Bank that Existing Borrower shall merge into Successor Borrower, with Successor Borrower being the surviving corporation (the “Merger”).

      D.  Existing Borrower and Successor Borrower have requested that the Loan Agreement and other Loan Documents be amended and supplemented in order to allow Successor Borrower to become the borrower under the Loan Agreement and other Loan Documents.

      E.  Bank has agreed to so amend and supplement the Loan Agreement and other Loan Documents, but only to the extent, in accordance with the terms, subject to the conditions and in reliance upon the representations, warranties and agreements set forth below.

Agreement

      Now, Therefore, in consideration of the foregoing recitals and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, and intending to be legally bound, the parties hereto agree as follows:

1. Definitions. Capitalized terms used but not defined in this Amendment shall have the meanings given to them in the Loan Agreement.

2. Assumption. Effective immediately upon the Merger, Successor Borrower, without any further action, hereby assumes and agrees to perform for the benefit of Bank all of the “Obligations” (as defined in the Loan Agreement) of Existing Borrower, and Successor Borrower agrees to honor, perform and in all respects comply with all terms and provisions of all of the Loan Documents (including, without limitation, the Loan Agreement and the Term Loan B Promissory Notes) to the same extent as though Successor Borrower were named therein jointly and severally with Existing Borrower. Effective immediately upon the Merger, all references in the Loan Agreement to “Collateral” and “Obligations” shall be deemed to refer to all present and future Collateral and Obligations (as therein defined) of Successor Borrower as well as Existing Borrower, and all references in the Loan Documents to “Borrower” shall be deemed to refer to Successor Borrower for itself and as successor to Existing Borrower. For example and without limitation on the generality of the foregoing, (i) the term “Loan Documents” as defined in the Loan Agreement shall include agreements executed by Existing Borrower prior to the Merger as well as agreements executed by Successor Borrower, and (ii) Section 5.11 of the Loan Agreement which reads as follows:

No written representation, warranty or other statement of Borrower in any certificate or written statement given to Bank, as of the date such representation, warranty, or other statement was made, taken together with all such written certificates and written statements given to Bank, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates or statements not misleading (it being recognized by Bank that the projections and forecasts provided by Borrower in good faith and based upon reasonable assumptions are not viewed as facts and that actual results during the period or periods covered by such projections and forecasts may differ from the projected or forecasted results).

shall apply to such representations, warranties or other statements whether given by Successor Borrower upon or after the Merger or by Existing Borrower or Cardiovascular Systems, Inc. (fka Replidyne, Inc.) prior to the Merger.

3. No Offset or Counterclaim. Existing Borrower and Successor Borrower acknowledge that the Obligations are owing to Bank from Existing Borrower and, effective immediately upon the Merger, will be owing from Successor Borrower, without any defense, offset or counterclaim of any kind or nature whatsoever.

4. Grant of Security Interest. Without limiting the generality of the provisions of Section 2 above, effective immediately upon the Merger, as security for all Obligations, Successor Borrower grants to Bank a continuing security interest in, and pledges to Bank, all of the following, whether now owned or hereafter acquired, and wherever located: All of the “Collateral” (as defined in the Loan Agreement) of Successor Borrower. Effective

immediately upon the Merger, all references in the Loan Agreement to Collateral shall be deemed to refer to the Collateral of each of Existing Borrower and Successor Borrower.

5. Merger Consent. Reference is made to the Consent Regarding RMS Merger, dated February 25, 2009, entered into between Bank and Existing Borrower. Borrowers hereby confirm and agree to perform the covenants and conditions agreed to by Existing Borrower pursuant to such Consent.

6. Financial and Merger-Related Representations and Warranties. Borrowers represent and warrant that the financial statements and reports of Cardiovascular Systems, Inc. (fka Replidyne, Inc.) delivered to Bank and/or filed with the Securities and Exchange Commission fairly present in all material respects the financial condition and results of operations of Cardiovascular Systems, Inc. (fka Replidyne, Inc.). Borrowers represent and warrant that there has not been any deterioration in the financial condition of Cardiovascular Systems, Inc. (fka Replidyne, Inc.) that is not reflected in such financial statements and reports. Borrowers represent and warrant that they have delivered to Bank true and complete copies of the Agreement and Plan of Merger and Reorganization dated November 3, 2008, among Responder Merger Sub, Inc. (“Merger Sub”), Successor Borrower and Existing Borrower (the “Merger Agreement”), the “Company Disclosure Schedule” (as defined in the Merger Agreement), and the “Replidyne Disclosure Schedule” (as defined in the Merger Agreement), and all amendments, supplements and updates thereto. The representations and warranties of Merger