Company: SXTPW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001013762-25-003343
Chunk: 1108

Company: 60 DEGREES PHARMACEUTICALS, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 4
Chunk 1108
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 of December 31, 2024, our derivative financial instruments consist of contingent payment arrangements.

We analyze all financial instruments with features of both liabilities
and equity under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic
No. 480, Distinguishing Liabilities from Equity (“ASC 480”), and FASB ASC Topic No. 815, Derivatives and Hedging
(“ASC 815”). Derivative liabilities are adjusted to reflect fair value at each reporting period, with any increase or decrease
in the fair value recorded in the results of operations, as a component of other income or expense as change in fair value of derivative
liabilities. We use a Monte Carlo simulation model or a probability-weighted expected return method to determine the fair value of these
instruments.

Upon conversion or repayment of a debt or equity
instrument in exchange for equity shares, where the embedded conversion option has been bifurcated and accounted for as a derivative
liability (generally convertible debt and warrants), we record the equity shares at fair value on the date of conversion, relieve all
related debt, derivative liabilities, and unamortized debt discounts, and recognize a net gain or loss on debt extinguishment, if any.

Equity or liability instruments that become subject
to reclassification under ASC Topic 815 are reclassified at the fair value of the instrument on the reclassification date.

Off-Balance Sheet Arrangements

During 2024 and 2023, we did not have any relationships
with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities that would have been
established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

57

JOBS Act Accounting Election

In April 2012, the JOBS Act was enacted. Section
107(b) of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided
in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. Thus, an emerging growth company
can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected
to avail ourselves of this exemption and, therefore, we will not be subject to the same new or revised accounting standards as other
public companies that are not emerging growth companies.

Recent Accounting Pronouncements

From time to time, the FASB