Company: SXTPW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001013762-25-003343
Chunk: 1915

Company: 60 DEGREES PHARMACEUTICALS, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 8
Chunk 1915
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 derivative
liability (conversion feature) was marked to market on the settlement date, and the Company recognized a debt extinguishment loss of
$614,670 upon settlement, representing the difference between (i) the reacquisition price, consisting of cash and shares, and (ii) the
net carrying value of the debt including associated derivative liabilities on the date of conversion. As such, as of December 31, 2024
and 2023 there were no amounts outstanding under the 2022 and 2023 Bridge Notes.

Related Party Notes

During May 2022, the Company executed convertible
promissory notes with the Company’s Chief Executive Officer and a family member related to the Chief Executive Officer. The notes
were initially due at the earlier of one-year from the issuance date or the closing of an IPO (the “Related Party Notes”).
Upon the closing of the IPO, these notes were mandatorily convertible at a conversion rate determined at a 20% discount to the IPO price,
discussed further below. Additionally, each of these note holders received five-year (5) fully vested warrants upon the closing of the
IPO, with an exercise price of 90% of the IPO price. 

The Company performed an evaluation of the conversion
features embedded in the Related Party Notes and the warrants and concluded that such instruments qualified for treatment as derivative
liabilities under ASC 815 and required bifurcation from the host contract. See Note 8 for further details.

As a result of the completion of the IPO and
as required under the terms of the Related Party Notes, the entirety of the outstanding principal balance converted to 1,333 shares of
common stock at a conversion rate equal to 80% of the IPO price, fully satisfying the Company’s obligations with respect to the
principal amount. In addition, the Company made cash payments to the related party holders totaling $31,968 in full settlement of the
outstanding debt obligation. As such, as of December 31, 2024 and 2023 there were no amounts outstanding under the Related Party Notes.

Significant terms of the Bridge Notes and Related
Party Notes are summarized as follows:

     2022  Bridge Notes   Related  Party Notes   2023  Bridge Notes   Issuance date of promissory notes   May 2022    May 2022    May 2023   Maturity date of promissory notes