Company: SXTPW
Filing Date: 2025-03-27
Form Type: S-1/A
Source: 0001013762-25-003353
Chunk: 108

Company: 60 DEGREES PHARMACEUTICALS, INC.
Filing Date: 2025-03-27
Form: S-1/A
Chunk 108
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 ended December 31, 2024 as we did not complete any debt financing transactions during the period. Change in Fair Value of Derivative Liabilities For the year ended December 31, 2024, we recognized a net gain on the change in fair value of derivative liabilities of $1,665,966 compared to a net loss of $37,278 for the year ended December 31, 2023. During the year ended December 31, 2024, derivative liabilities include the contingent milestone payment due to Knight upon a future sale of Arakoda or a Change of Control. The fair value of the contingent milestone payment is inversely related to the net present value of future investments in the Company and anticipated timing to profitability within our budget models. During the year ended December 31, 2023, derivative liabilities consisted of bridge shares, certain warrants, and embedded conversion features in our convertible notes, which were each converted or reclassified to equity upon the closing of our IPO. We use a probability-weighted expected return method or a Monte Carlo simulation model to estimate the fair value of these instruments. Loss on Debt Extinguishment For the year ended December 31, 2024, we did not recognize a gain or loss on debt extinguishment ($1,231,480 loss recognized during the year ended December 31, 2023). The decrease is related, in part to the conversion of the cumulative outstanding debt pursuant to the Knight Debt Conversion Agreement in January 2023, which was accounted for as a debt extinguishment, as well as losses recognized upon extinguishment of our interim bridge financing notes, all of which were settled or converted upon our IPO in July 2023. The net amount for the year ended December 31, 2023 was partially offset by a debt extinguishment gain of $223,077 recognized on conversion of the Xu Yu promissory note on the date of our IPO. Change in Fair Value of Promissory Note For the year ended December 31, 2023, we recognized a net gain of $5,379,269 related to the change in the fair value of the Convertible Knight Loan, which was held at fair value beginning on the modification date in January 2023. The gain relates to the mark to market adjustment recognized immediately prior to the automatic conversion of the outstanding debt obligation into our equity shares upon the closing of our IPO. We no longer have any debt obligations measured at fair value on a recurring basis, hence we recorded a $0 change in