11. COMMITMENTS AND CONTINGENCIES Compensation of President and CEO. On November 5, 2012, the Company entered into a letter agreement with Darlene Horton, M.D., its President and Chief Executive Officer, pursuant to which Dr. Horton agreed to reduce her monthly salary to $ 100 effective November 1, 2012, and defer the balance of her $ 28,314 monthly base salary (the  Deferred Salary ) until such time as the Company completes an Interim Financing Event (defined below). The term  Interim Financing Event  means the consummation on or before December 31, 2013, of one or more transactions pursuant to which the Company shall have received, whether by a financing, strategic transaction or another means (or any combination thereof), an aggregate of at least $ 1,000,000 in gross proceeds. As of June 30, 2013, the Company has an accrual of $ 225,712 , representing approximately 8 months of Deferred Salary. On March 21, 2013, the Company entered into a letter agreement with Dr. Horton, which letter agreement amends certain compensation terms under her existing letter agreement dated August 3, 2012, as previously amended on November 5, 2012. Dr. Horton s existing letter agreement provided that if, prior to the date of a  compensation adjustment event,  the Company completed a Change of Control Transaction (as defined in the agreement) and Dr. Horton s employment was terminated by the Company (or any successor entity) without cause during the period beginning on the effective date of the Change of Control Transaction and ending on the six-month anniversary of such effective date, then she would have been entitled to receive a cash payment equal to 5 % of the applicable Change of Control Proceeds (as defined in the agreement). For purposes of the agreement, the term  compensation adjustment event  means the date on which the Company secures sufficient capital, whether by a financing or strategic transaction (or any combination thereof) or another means, in order to enable the Company to initiate and fund to completion a Phase