Exhibit 10.4


 


AMENDMENT TO INCENTIVE STOCK OPTION
AGREEMENT


 


This AMENDMENT TO INCENTIVE STOCK
OPTION AGREEMENT (this “Amendment”), dated as of                ,
2016, is made and entered into by and between PhaseRx, Inc., a Delaware corporation (the “Company”),
and                 (the “Participant”).
Terms used in this Amendment with initial capital letters that are not otherwise defined herein shall have the meanings ascribed
to such terms in the Incentive Stock Option Agreement by and between the Company and the Participant, dated                ,
2016 (the “Option Agreement”), and in the PhaseRx 2016 Long-Term Incentive Plan.


 


WHEREAS, pursuant to the Option
Agreement, the Company granted an option (the “Option”) to the Participant to purchase a total of                
(               ) full shares of Common
Stock of the Company at an Option Price equal to $               
per share; and


 


WHEREAS,
Section 24 of the Option Agreement provides that the Option Agreement can be amended by a writing signed by the parties thereto,
and the Company and the Participant now desire to amend the Option Agreement to revise the vesting provisions that would apply
in connection with a Change in Control.


 


NOW, THEREFORE,
in accordance with the terms of the Option Agreement, and for good and valuable consideration, the sufficiency of which is hereby
acknowledged, the Company and the Participant agree as follows:


 


		1.	Section 3 of the Option Agreement is
                                         amended by deleting the last paragraph of said Section and replacing it with the following
                                         new paragraph as follows:



 


In the event that a Change in
Control occurs, (i) fifty percent (50%) of the total Optioned Shares not previously vested shall become vested and exercisable
upon the effective date of the Change in Control and (ii) any remaining Optioned Shares not previously vested shall become fully
vested and exercisable on the date of the Participant’s Termination of Service by the Company without Cause (as defined
herein) if such Termination of Service occurs on or before the first anniversary of the Change in Control’s effective date.


 


		2.	Section 4(b) of the Option Agreement
                                         is amended by deleting said Section in its entirety and replacing it with the following
                                         new Section 4(b) as follows:



 


b.      
For purposes of this Agreement, “Cause” means the Participant’s Termination of Service by the
Company because of: (i) the Participant’s conviction of, or plea of nolo contendere to, a felony or crime involving moral
turpitude or (ii) the Participant’s breach of fiduciary duty which involves personal profit. Notwithstanding the foregoing,
in the case of any Participant who has entered into an employment agreement with the Company or any Subsidiary that contains the
definition of “cause” (or any similar definition), then during the term of such employment agreement the definition
contained in such employment agreement shall be the applicable definition of “cause” under the Agreement as to such
Participant if such employment agreement expressly so provides.


 


		3.	The Option Agreement, except as modified
                                         by this Amendment, shall remain in full force and effect.



 




     


     


    

 


IN WITNESS WHEREOF,
the Company and the Participant have executed, or caused to be executed, this Amendment effective as of the day and year first
written above.


 


	 	PhaseRx,
    Inc.
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 
	 	THE PARTICIPANT
	 	 
	 	[Name]	 


 






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