Company: SXTPW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001013762-25-003343
Chunk: 271

Company: 60 DEGREES PHARMACEUTICALS, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1A
Chunk 271
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 718, Compensation - Stock Compensation (“ASC 718”). We measure compensation for all share-based
payment awards granted to employees, directors, and nonemployees, based on the estimated fair value of the awards on the date of grant.
For awards that vest based on continued service, the service-based compensation cost is recognized on a straight-line basis over the
requisite service period, which is generally the vesting period of the awards. For service vesting awards with compensation expense recognized
on a straight-line basis, at no point in time does the cumulative grant date value of vested awards exceed the cumulative amount of compensation
expense recognized. The grant date is determined based on the date when a mutual understanding of the key terms of the share-based awards
is established. We account for forfeitures as they occur.

We estimate the fair value of all stock option
awards as of the grant date by applying the Black-Scholes option pricing model. The application of this valuation model involves assumptions,
including the fair value of the common stock, expected volatility, risk-free interest rate, expected dividends and the expected term
of the option. Due to the lack of a public market for our common stock prior to the IPO and lack of company-specific historical implied
volatility data, we base our computations of expected volatility on the historical volatility of a representative group of public companies
with similar characteristics of the Company, including stage of development and industry focus. The historical volatility is calculated
based on a period of time commensurate with the expected term assumption. We generally use the simplified method as prescribed by the
SEC Staff Accounting Bulletin Topic 14, Share-Based Payment, to estimate the expected term for stock options, whereby, the expected
term equals the midpoint of the weighted average remaining time to vest, vesting period and the contractual term of the options due to
our lack of historical exercise data. For certain options granted out-of-the-money, our best estimate of the expected term is the contractual
term of the award. The risk-free interest rate is based on U.S. Treasury securities with a maturity date commensurate with the expected
term of the associated award. The expected dividend yield is assumed to be zero as we have never paid dividends and have no current plans
to pay any dividends on our common stock. The assumptions used in calculating the fair value of share-based awards represent our best
estimates and involve inherent uncertainties and the application of significant judgment.

We recognize compensation expense for restricted
stock units (“RSUs”) with only service-based vest