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| Stock-Based Incentive Plans | Note 7. Stock-Based Incentive Plans Stock-Based Plans On June 11, 2025, the Company’s shareholders approved the 2025 Director Incentive Plan and the Second A&R 2022 Plan. The 2025 Director Incentive Plan provides equity-based compensation to non-executive directors by making available a total of 300,000 shares for awards granted on or after the date on which the 2025 Director Incentive Plan was approved by the Company’s shareholders. The 2025 Director Incentive Plan is intended to be the successor to the 2015 Plan. No further awards may be made under the 2015 Plan, although any outstanding awards under the 2015 Plan will continue to remain in full force and effect. The Second A&R 2022 Plan provides for an aggregate of 2,200,000 shares that can be issued pursuant to awards granted on or after the date on which the Second A&R 2022 Plan was approved by the Company’s shareholders. The other terms of the Second A&R 2022 Plan, including its expiration date, remain unchanged from the A&R 2022 Plan. As of June 30, 2025, under the 2025 Director Incentive Plan, there were 261,983 shares available for future grants to LivaNova’s non-executive directors, and under the Second A&R 2022 Plan, there were 2,200,000 shares available for future grants to LivaNova’s employees. For the six months ended June 30, 2025, LivaNova issued stock-based compensatory awards to its employees and Board of Directors with terms approved by the Compensation and Human Capital Management Committee of LivaNova’s Board of Directors and LivaNova’s Board of Directors, respectively. The employee awards with service conditions generally vest ratably over three years for RSUs and four years for SARs, and are subject to forfeiture unless service conditions are met. The employee market performance-based awards that were issued cliff vest after three years, subject to the rank of LivaNova’s total shareholder return for the three-year period ending December 31, 2027, relative to the total shareholder returns of the S&P Healthcare Equipment Select Industry Index. The employee adjusted free cash flow and return on invested capital operating performance-based awards that were issued cliff vest after three years, subject to the achievement of certain thresholds of cumulative results for the three-year period ending December 31, 2027. The Board of Director RSU awards with service conditions generally vest ratably over one year. Compensation expense related to awards granted during 2025 for the three and six months ended June 30, 2025 was $2.1 million and $2.3 million, respectively. Stock-Based Compensation Expense The following table presents the amounts of stock-based compensation expense recognized in LivaNova’s condensed consolidated statements of income (loss) by type of arrangement (in thousands):
Stock-based compensation agreements issued for the six months ended June 30, 2025, representing potential shares and their weighted average grant date fair values by type, are as follows (shares in thousands, fair value in dollars):
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