  Fractionalization is a hallmark of spin-liquid behavior; it typically leads
to response functions consisting of continua instead of sharp modes. However,
microscopic processes can enable the formation of short-distance bound states
of fractionalized excitations, despite asymptotic deconfinement. Here we study
such bound-state formation for the $Z_2$ spin liquid realized in Kitaev's
honeycomb compass model, supplemented by a kekule distortion of the lattice.
Bound states between flux pairs and Majorana fermions form in the Majorana band
gaps. We calculate the dynamic spin susceptibility and show that bound states
lead to sharp modes in the magnetic response of the spin liquid, with the
momentum dependence of the corresponding spectral weight encoding internal
symmetry of the bound state. As a byproduct, we also show that isolated fluxes
may produce Majorana bound states at exactly zero energy. Generalizations and
implications of the results are discussed.
