EX-10.9



 





Exhibit 10.9




J.P. MORGAN CHASE & CO.




STOCK OPTION PLAN




Effective January 18, 2001




Purposes.



The purposes of the J. P. Morgan Chase & Co. Stock Option Plan (the “Plan”) are to encourage key
employees of the Company to acquire a proprietary and vested interest in the growth and performance
of the Company, to retain their services, and to generate an increased incentive to contribute to
the Company’s future success and prosperity, thus enhancing the value of the Company for the
benefit of stockholders.



The purposes of the Plan are to be achieved through grants of stock options to be awarded to
Employees of the Company.




Article 1. Definitions.



For purposes of the Plan, the following terms shall have the meanings set forth below:



1.1 “Award” shall mean a stock option or stock appreciation right granted pursuant to the Plan.



1.2 “Board” shall mean the Board of Directors of the Corporation; provided that any action
taken by a duly authorized committee of the Board within the scope of authority delegated to such
committee by the Board shall be considered an action of the Board for purposes of this Plan.



1.3 “Code” shall mean the Internal Revenue Code of 1986, as from time to time amended.



1.4 “Committee” shall mean the Compensation and Management Development Committee of the Board or
any subcommittee thereof or any other Committee of the Board or subcommittee thereof performing
substantially similar duties.



1.5 “Common Stock” shall mean the common stock of the Corporation, $1 par value.





	 	6.	 	“Company” shall mean the Corporation and its Subsidiaries.




1.7
“Corporation” shall mean J. P. Morgan Chase & Co., and, except as otherwise specified in this
Plan in a particular context, any successor thereto, whether by merger, consolidation, purchase of
all or substantially all its assets or otherwise.




 









 






1.8 “Employee” shall mean any employee of the Company who is receiving compensation for services
rendered to the Company as an employee. By way of clarification, individuals who are not classified
as employees of the Company for purposes of the Company’s human resources information and payroll
systems on the actual date of an Award, including, without limitation, individuals employed by
temporary help firms or other staffing firms or who are treated as independent contractors by the
Company (whether or not deemed to be common law employees or leased employees), are not
“Employees.” In addition, in the event that any individual is re-classified as an employee for any
purpose by any action of any third party or as a result of any lawsuit, action or administrative
proceeding, such individual shall not be deemed an “Employee” under the Plan.



1.9 “Executive Officer” shall mean an Employee who is subject to the requirements of Sections 16(a)
and 16(b) of the Securities Exchange Act of 1934.



1.10 “Fair Market Value” shall mean, for each share of Common Stock, the average of high and low
sale prices of the Common Stock as reported on the New York Stock Exchange (the “NYSE”) composite
tape on the applicable date, or, if there are no such sale prices of Common Stock reported on the
NYSE composite tape on such date, then the average price of the Common Stock on the last previous
day on which high and low sale prices are reported on the NYSE composite tape; provided that
notwithstanding the foregoing, the Committee can select such other method of establishing “Fair
Market Value” as it deems reasonable and appropriate.



1.11 “Participant” shall mean an Employee who is selected by the Committee or its designatee to
receive an Award under the Plan; provided that no Award may be made to any Employee who is
an Executive Officer on the date of grant.



1.12 “Subsidiary” shall mean any corporation which at the time qualifies as a subsidiary of the
Corporation under the definition of “subsidiary corporation” in Section 424(f) of the Code, as
amended from time to time.





	 	13.	 	“Total Disability” shall mean a physical or mental incapacity, which would entitle the
individual to benefits under the long term disability program sponsored by a Subsidiary
employing such individual; provided that if an individual has not elected coverage
under the applicable program, the Committee shall determine, utilizing the criteria of such
program, whether the individual has incurred a Total Disability.





Article 2. Shares Subject to the Plan.



2.1 Shares of Common Stock which may be issued under the Plan may be authorized and unissued shares
of Common Stock or authorized and issued shares of Common Stock held in Treasury. Subject to
adjustment as provided in Article 10, the number of shares of Common Stock that may be granted
under the Plan shall be the number specified by the Committee from time to time.




 









 







Article 3. Award Dates; Eligibility.





	 	1.	 	Awards may be made on such dates as the Committee specifies.




3.2 The Committee shall designate the Employees eligible for an Award hereunder and number of
options awarded each such individual who shall be a Participant following delivery of the Award
agreement; provided that, the Committee may designate that the Director Human Resources or
other officers of the Corporation shall determine the Employee who are to be recipients of Awards
and the number of options to be awarded hereunder; provided that the Committee or its
designatee may specify different levels of Awards for different Employees; provided,
further, that no Executive Officer shall receive an Award under this Plan.




Article 4. Administration.



4.1 The Committee shall administer the Plan. The Committee may operate through subcommittees
established by it, consisting of not fewer than two members of the Committee. The Committee may
delegate any or all of its responsibilities and authorities hereunder to one or more officers or
employees of the Company. The Director Human Resources of the Corporation shall be deemed to have
been delegated all of the Committee’s responsibilities and authorities hereunder until such time,
if any, as the Committee shall determine to withdraw such delegation.



4.2 The Committee is authorized to interpret the Plan, to establish, amend, and rescind any rules
and regulations relating to the Plan, to determine the terms and provisions of any agreements
entered into hereunder, and to make all other determinations necessary or advisable for the
administration of the Plan. The Committee may correct any defect, supply any omission or reconcile
any inconsistency in the Plan or in any Award in the manner and to the extent it shall deem
desirable to carry the Plan or any such Award into effect. The determinations of the Committee or
its designatee in the administration of the Plan, as described herein, shall be final and
conclusive.



4.3 The validity, construction and effect of the Plan and any rules and regulations relating to the
Plan shall be determined in accordance with the laws of the State of New York and applicable laws
of the United States of America.




Article 5. Stock Options.



5.1 Any stock options granted under the Plan shall be in such form as the Committee may from time
to time approve and shall be subject to the terms and conditions provided herein and such
additional terms and conditions, as the Committee shall deem desirable. In particular, the
Committee may establish performance criteria that relate to the exercise of any award.



5.2 Stock options (other than incentive stock options) may be granted to any Participant. The
Committee shall establish the option price at the time each stock option is granted, which price in
the case of a nonqualified stock option shall not be less than 100% of the Fair Market Value of the
Common Stock on the date of grant.



5.3 Stock options under an Award may not be exercisable later than 10 years after their date of
grant. The option price of each share of Common Stock as to which a stock option is exercised shall
be paid in full at the time of such exercise. Such payment may be made at the sole discretion of
the Committee, pursuant to and in accordance with criteria and guidelines established by the
Committee as the same may be modified from time to time, (i) in cash, (ii) by tender of shares of
Common Stock already owned by the Participant, valued at Fair Market Value as of the date of
exercise, (iii) if authorized by the Committee, by withholding pursuant to the election of the
Participant from those shares that would


 









 





otherwise be obtained upon exercise of the option a number
of shares having a Fair Market Value equal to the option price, (iv) if authorized by the
Committee, by delivery of a properly executed exercise notice together with irrevocable
instructions to a securities broker (or, in the case of pledges, lender) approved by the Committee
(or telephonic instructions to the Company, having the same effect) to, (a) sell shares of Common
Stock subject to the option and to deliver promptly to the Corporation a portion of the proceeds of
such sale transaction on behalf of the exercising Participant to pay the option price, or (b)
pledge shares of Common Stock subject to the option to a margin account maintained with a broker or
lender, as security for a loan, and such broker or lender, pursuant to irrevocable instructions,
delivers to the Corporation the loan proceeds, at the time of exercise to pay the option price, or
(v) by any combination of (i), (ii), (iii) or (iv) above.




Article 6. Award Agreements.



6.1 Each Award under the Plan shall be evidenced by an agreement (which agreement need not be
executed by the option holder) setting forth the terms and conditions, as determined by the
Committee, which shall apply to such Award.




Article 7. Withholding.



7.1 The Company shall have the right to deduct from all amounts paid to any Participant in cash
(whether under this Plan or otherwise) any taxes required by law to be withheld therefrom. In the
case of payments of Awards in the form of Common Stock, at the Committee’s discretion the
Participant may be required to pay to the Company the amount of any taxes required to be withheld
with respect to such Common Stock, or, in lieu thereof, the Company shall have the right to retain
the number of shares of Common Stock the Fair Market Value of which equals the amount required to
be withheld. Without limiting the foregoing, the Committee may, in its discretion and subject to
such conditions as it shall impose, permit share withholding to be done at the Participant’s
election.




Article 8. Nontransferability.



8.1 No Award shall be assignable or transferable, and no right or interest of any Participant in
any Award shall be subject to any lien, obligation or liability of the Participant, except as
otherwise set forth in the Award agreement; provided that with respect to Awards, the
Committee may, in its sole discretion, permit certain Participants to transfer Awards to such
individuals or entities as the Committee may specify.




Article 9. No Right to Employment or Continued Participation in Plan.



9.1 No person shall have any claim or right to the grant of an Award prior to the date that an
Award agreement is delivered to such person and the satisfaction of the appropriate formalities
specified in the Award agreement, and the grant of an Award shall not be construed as giving a
Participant the right to be retained in the employ of the Company or to be eligible for any
subsequent Awards. Further, the Company expressly reserves the right to dismiss at any time a
Participant free from any liability or any claim under the Plan, except as provided herein or in
any agreement entered into hereunder.




Article 10. Adjustment of and Changes in Common Stock.



10.1 In the event of any change in the outstanding shares of Common Stock by reason of any stock
dividend or split, recapitalization, issuance of a new class of common stock, merger,
consolidation, spin-off, combination or exchange of shares or other similar corporate change, or
any distributions to


 









 





stockholders of Common Stock other than regular cash dividends, the Committee
may make such substitution or adjustment, if any, as it deems to be equitable, as to the number or
kind of shares of Common Stock or other securities issued or reserved for issuance pursuant to the
Plan, adjustments (including the number of shares and the exercise price) to outstanding Awards.




Article 11. Amendment.



11.1 The Board or the Committee may amend, suspend or terminate the Plan or any portion hereof at
any time.




Article 12. Unfunded Status of Plan.





	 	1.	 	The Plan is intended to constitute an “unfunded” plan for long-term incentive compensation.
Nothing herein shall be construed to give any Participant any rights that are greater than
those of a general unsecured creditor of the Corporation.





Article 13. Non-United States Locations.



13.1 Notwithstanding anything to the contrary in the Plan, the Plan as applied to Employees located
outside the United States and all Awards granted to such Employees shall be subject to applicable
laws, rules, regulations, orders and requirements from time to time in effect in such
jurisdictions, including those that may limit, restrict or prevent such Awards or the exercise of
any Award. The Corporation shall have no obligation to take any action required to comply with any
such laws, rules, regulations, orders or requirements in order to grant any Award to, or to make
any stock option exercisable by, any Employee. Notwithstanding anything herein to the contrary, the
Committee, in its discretion, may issue stock appreciation rights in lieu of options to Employees
located outside the United States when, in the opinion of the Committee, the grant of an option
would be in violation of local law or be administratively burdensome.




Article 14. Effective Date.



14.1 This Plan shall be effective on January 18, 2001.