Company: SXTPW
Filing Date: 2025-02-14
Form Type: S-1
Source: 0001213900-25-014334
Chunk: 301

Company: 60 DEGREES PHARMACEUTICALS, INC.
Filing Date: 2025-02-14
Form: S-1
Chunk 301
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 more of our outstanding common stock. |

| ● | In addition to the conversion of the debt, for a period commencing on January 1, 2022 and ending upon the earlier of 10 years after the Closing or the conversion or redemption in full of the Preferred Stock, Company shall pay Lender a royalty equal to 3.5% of the Company’s net sales (the “Royalty”), where “Net Sales” has the same meaning as in the Company’s license agreement with the U.S. Army for tafenoquine. Upon success of the Qualified IPO, the Company shall calculate the royalty payable to Knight at the end of each calendar quarter. The Company shall pay to Knight the royalty amounts due with respect to a given calendar quarter within fifteen (15) business days after the end of such calendar quarter. Each payment of royalties due to Knight shall be accompanied by a statement specifying the total gross sales, the net sales and the deductions taken to arrive to net sales. For clarification purposes, the first royalty payment will be performed following the above instructions, on the first calendar quarter in which the Qualified IPO takes place and will cover the sales for the period from January 1, 2022 until the end of said calendar quarter. |

The Company evaluated the January 9, 2023 exchange agreement in accordance with ASC 470-50 and concluded that the debt qualified for debt extinguishment because a substantial conversion feature was added to the debt terms. Upon extinguishment, the Company recorded a loss upon extinguishment in the amount of $ 839,887and elected to recognize the new debt under the ASC 825 fair value option until it is settled.

A reconciliation of the beginning and ending balances for the Convertible Knight Note, which is measured at fair value on a recurring basis using significant unobservable inputs (Level 3) is as follows for the year ended December 31, 2023:

| Promissory Notes, at fair value at December 
 31, 2022                                    
 Fair value                                  
 at modification date - January 9, 2023      |     | Convertible   
 Knight        
 Note, at fair 
 value         |           - 
  21,520,650 |   |
|:--------------------------------------------|:----|:--------------|------------:|:--|
| Fair                                        
 value - mark to market adjustment           |     |               |  (5,379,269 | ) |
| Accrued                                     
 interest recognized                         |     |               |   1,293,