EX-10.21






Exhibit 10.21




JPMORGAN CHASE & CO. LONG-TERM INCENTIVE PLAN

TERMS AND CONDITIONS OF JANUARY 20, 2009

STOCK APPRECIATION RIGHTS

OPERATING COMMITTEE




	 	 	 
	Award Agreement
	 	These terms and conditions are made part of the Award Agreement dated as of
January 20, 2009 (“Grant Date”) awarding Stock Appreciation Rights pursuant
to the terms of the JPMorgan Chase & Co. Long-Term Incentive Plan (“Plan”).
To the extent the terms of the Award Agreement (all references to which
will include these terms and conditions) conflict with the Plan, the Plan
will govern. The Award Agreement, the Plan and Prospectus supersede any
other agreement, whether written or oral, that may have been entered into
by the Firm and you relating to this award.

	 	 	 

	 	 	This award was granted on the Grant Date subject to the Award Agreement.
Unless you decline by the deadline and in the manner specified in the Award
Agreement, you will have agreed to be bound by these terms and conditions,
effective as of the Grant Date. If you decline the award, it will be
cancelled as of the Grant Date.

	 	 	 

	 	 	Capitalized terms that are not defined in the Award Agreement will have the
same meaning as set forth in the Plan.

	 	 	 

	 	 	JPMorgan Chase & Co. will be referred to throughout the Award Agreement as
“JPMorgan Chase,” and together with its subsidiaries as the “Firm.”

	 	 	 

	Form and Purpose of Award
	 	Stock Appreciation Rights represent the right, following exercise, to
receive (without payment), a number of shares of JPMorgan Chase Common
Stock, the Fair Market Value of which, as of the date of exercise, is equal
to the excess of the Fair Market Value of one share of such Common Stock on
such exercise date over the Exercise Price, multiplied by the number of
Stock Appreciation Rights being exercised. The Firm will retain from each
distribution the number of shares of Common Stock required to satisfy tax
withholding obligations.

	 	 	 

	 	 	The purpose of this award is, in part, to motivate your future performance
and to align your interests with those of the Firm and its shareholders.

	 	 	 

	Exercisable Dates/
Expiration
Date	 	Your award will become exercisable on the “Exercisable Dates” set forth in
your Award Agreement, provided that you are continuously employed by the
Firm from the date of grant through the relevant Exercisable Date or you
meet the requirements to allow your award to remain outstanding upon
termination of employment as described below, and subject to the following:

	 	 	 

	 	 	•   Although it is intended and expected that this award will become
exercisable as scheduled, the award may be reduced or cancelled or
Exercisable Dates may be deferred in the event that the Chief Executive
Officer (“CEO”) of JPMorgan Chase determines, as part of JPMorgan Chase’s
annual performance assessment process, based on the CEO’s assessment of
your performance and the performance of the Firm (which may include more
than one performance year), that you have not achieved satisfactory
progress toward your priorities or that the Firm has not achieved
satisfactory progress toward the Firm’s priorities for which you share
responsibility as a member of the Operating Committee. Such a determination
is subject to ratification by the Compensation and Management Development
Committee of the Board of Directors of JPMorgan Chase.

	 	 	 

	 	 	•   JPMorgan Chase reserves the right to cancel, or require repayment
of any gains you derived from the exercise of, all or any portion of this
award to the extent provided under the JPMorgan Chase Bonus Recoupment
Policy as in effect from time to time.

	 	 	 

	 	 	•   JPMorgan Chase reserves the right to cancel, or require repayment
of any gains you derived from exercise of, all or any portion of this award
if JPMorgan Chase determines that this award was based on materially
inaccurate performance metrics or on any misrepresentation by you.

	 	 	 

	 	 	•   If you are subject to Section 111 of the Emergency Economic
Stabilization Act of 2008 and any regulations or interpretations
promulgated thereunder, or any successor or other

















 






January 20, 2009 Stock Appreciation Rights — Operating Committee (continued)

 






	 	 	 
	 	 	applicable statute
affecting your compensation (“EESA or Other Applicable Law”), then any
payment of any kind provided for by this Award Agreement must comply with
EESA or Other Applicable Law, and this Award Agreement shall be interpreted
or reformed to so comply.

	 	 	 

	 	 	Your award will remain exercisable until the earlier of the tenth
anniversary of the Grant Date (the “Expiration Date”) or the date the award
is cancelled pursuant to this Award Agreement. No Stock Appreciation Right
may be exercised after its Expiration Date.

	 	 	 

	Termination of Employment
	 	Except as explicitly set forth below under “Job Elimination,” “Full Career
Eligibility” and “Death or Total Disability,” any Stock Appreciation Rights
outstanding under this award will be cancelled effective on the date your
employment with the Firm terminates for any reason.

	 	 	 

	 	 	•   Job Elimination:

	 	 	 

	 	 	In the event that the Director Human Resources of the Firm or nominee in
their sole discretion determine that the Firm terminated your employment
because your job was eliminated, and provided that you continue to provide
services in a cooperative and professional manner as requested by the Firm
until the date your employment terminates, then any Stock Appreciation
Rights that were exercisable on your termination date will remain
exercisable for the ninety-day period immediately following your
termination date, but in no event beyond the Expiration Date.

	 	 	 

	 	 	You will be required to timely execute and deliver a release of claims in
favor of the Firm, having such form and terms as the Firm shall specify, to
have all or any portion of your award remain exercisable after the
termination of your employment and you must certify compliance with the
above requirements on a form provided by the Firm in connection with an
exercise. If you fail to return the required release within the specified
deadline, your outstanding Stock Appreciation Rights will be cancelled.

	 	 	 

	 	 	•   Full Career Eligibility:

	 	 	 

	 	 	Any Stock Appreciation Rights that were exercisable as of the date of your
employment termination will remain exercisable for a two year period
following your termination date but in no event beyond the Expiration Date
in the event that:

	 	 	 

	 	 	•   you leave the Firm voluntarily, have completed at least five years
of continuous service with the Firm immediately preceding your termination
date, and

	 	 	 

	 	 	•   the sum of your age and Recognized Service (as defined below) on
your date of termination equals or exceeds 60, and

	 	 	 

	 	 	•   you provide at least 90 days advance written notice to the Firm of
your intention to voluntarily terminate your employment under this
provision during which notice period you provide such services as requested
by the Firm in a cooperative and professional manner and you do not perform
any services for any other employer, and

	 	 	 

	 	 	•   for the two year period following your termination date, you do not
(i) perform services in any capacity (including self-employment) for a
Financial Services Company (as defined below) or (ii) work in your
profession (whether or not for a non-Financial Services Company); provided
that you may work for a government, education or Not-for-Profit
Organization (as defined below).

	 	 	 

	 	 	After receipt of such advance written notice, the Firm may choose to have
you continue to provide services during the 90-day period or shorten the
length of the 90-day notice period at the Firm’s discretion, but to a date
no earlier than the date you would otherwise meet the age and service
requirements.

	 	 	 

	 	 	Additional advance notice requirements may apply in certain business units
(or equivalent organizational unit or department). (See “Special Notice
Period” below.)

	 	 	 

	 	 	You will be required to timely execute and deliver a release of claims in
favor of the Firm, having such form and terms as the Firm shall specify, to
have all or any portion of your award







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January 20, 2009 Stock Appreciation Rights — Operating Committee (continued)

 






	 	 	 
	 	 	remain exercisable after the
termination of your employment and you must certify compliance with the
above requirements on a form provided by the Firm in connection with an
exercise. If you fail to return the required release within the specified
deadline, your outstanding Stock Appreciation Rights will be cancelled

	 	 	 

	 	 	With respect to full career eligibility, you must notify JPMorgan Chase in
advance in writing if you are to perform services for any party or if you
are self-employed following the date of your termination of employment.
Failure to provide such notification could impact your right to exercise.

	 	 	 

	 
	 	•   Death or Total Disability:

	 	 	 

	 	 	If you die while employed by the Firm, or in the event your employment
terminates as a result of your permanent and total disability as defined in
the JPMorgan Chase & Co. Long Term Disability Plan (or for non-U.S.
employees the equivalent local country plan), then any Stock Appreciation
Rights that were exercisable as of the date of your termination will remain
exercisable for a two year period following your termination date but in no
event beyond the Expiration Date.

	 	 	 

	 	 	In the case of your total disability, you must notify JPMorgan Chase in
advance in writing if you are to perform services for any party or if you
are self-employed following the date of your termination of employment.

	 	 	 

	 	 	In the case of death, your beneficiary is the designated beneficiary on
file with the Human Resources Department, or if no beneficiary has been
designated or survives you, then your estate.

	 	 	 

	 	 	Any Stock Appreciation Rights that are not exercised within the applicable
two year period set forth above will be cancelled.

	 	 	 

	 
	 	•   Termination for Cause:

	 	 	 

	 	 	In the event your employment is terminated for Cause (as defined below), or
in the event that the Firm determines after the termination of your
employment that your employment could have been terminated for Cause, any
outstanding Stock Appreciation Rights as of your termination date will be
cancelled and you may be required to return to the Firm the value of
certain shares previously delivered to you. See “Remedies” for additional
information.

	 	 	 

	Restriction on Disposition
of Shares Derived from an
Exercise Under this Award
	 	If you exercise any part of your award before the fifth anniversary of the
Grant Date, then you may not sell, assign, transfer, pledge or encumber the
net number of shares of Common Stock derived from such exercise until the
fifth anniversary of the Grant Date. Notwithstanding the foregoing, this
restriction on disposition and transfer of shares shall not apply to your
beneficiary in the event of your death.

	 	 	 

	Your Obligations
	 	As consideration for the grant of this award, you agree to comply with and
be bound by the following:

	 	 	 

	•   Non-Solicitation of
Employees and Customers:

	 	During your employment by the Firm and for one year following the
termination of your employment (or if longer, the exercise period), you
will not directly or indirectly, whether on your own behalf or on behalf of
any other party, without the prior written consent of the Director Human
Resources of JPMorgan Chase: (i) solicit, induce or encourage any of the
Firm’s then current employees to leave the Firm or to apply for employment
elsewhere; (ii) hire any employee or former employee who was employed by
the Firm at the date your employment terminated, unless the individual’s
employment terminated more than six months before the date of hire or
because his or her job was eliminated; or (iii) solicit or induce or
attempt to induce to leave the Firm, or divert or attempt to divert from
doing business with the Firm, any then current customers, suppliers or
other persons or entities that were serviced by you or whose names became
known to you by virtue of your employment with the Firm, or otherwise
interfere with the







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January 20, 2009 Stock Appreciation Rights — Operating Committee (continued)

 






	 	 	 
	 	 	relationship between the Firm and such customers,
suppliers or other persons or entities. This does not apply to publicly
known institutional customers that you service after your employment with
the Firm without the use of the Firm’s confidential or proprietary
information.

	 	 	 

	 	 	These restrictions do not apply to authorized actions you take in the
normal course of your employment with the Firm, such as employment
decisions with respect to employees you supervise or business referrals in
accordance with the Firm’s policies.

	 	 	 

	•   Confidential
Information:

	 	You may not, either during your employment with the Firm or thereafter,
directly or indirectly use or disclose to anyone any confidential
information related to the Firm’s business, except as explicitly permitted
by the JPMorgan Chase Code of Conduct and applicable policies or law or
legal process. “Confidential information” shall have the same meaning for
the Award Agreement as it has in the JPMorgan Chase Code of Conduct.

	 	 	 

	•   Non-Disparagement:

	 	You may not, either during your employment with the Firm or thereafter,
make or encourage others to make any public statement or release any
information that is intended to, or reasonably could be foreseen to,
embarrass or criticize the Firm or its employees, directors or shareholders
as a group. This shall not preclude you from reporting to the Firm’s
management or directors or to the government or a regulator conduct you
believe to be in violation of the law or the Firm’s Code of Conduct or
responding truthfully to questions or requests for information to the
government, a regulator or in a court of law in connection with a legal or
regulatory investigation or proceeding.

	 	 	 

	•   Cooperation

	 	You agree to cooperate fully with and provide full and accurate information
to the Firm and its counsel with respect to any matter (including any
audit, tax proceeding, litigation or governmental proceeding with respect
to which you may have knowledge or information, subject to reimbursement
for actual, appropriate and reasonable expenses incurred by you.

	 	 	 

	•   Compliance with
Award Agreement:

	 	You agree that you will provide the Firm with any information reasonably
requested to determine compliance with the Award Agreement, and you
authorize the Firm to disclose the terms of the Award Agreement to any
third party who might be affected thereby, including your prospective
employer.

	 	 	 

	•   Special Notice
Period:

	 	If you are at or above the level of managing director, executive director
or vice president (or comparable title) of a business unit or equivalent
organizational unit or department (“business unit”) that requires as a
condition of your continued employment that you provide advance written
notice (“Special Notice Period”) of your intention to terminate your
employment for any reason, then as consideration for this Award, you shall
provide the Firm advance written notice of your election to terminate your
employment as specified by such business unit. In business units that
require this Special Notice Period, the current notice period is 90 days
for managing directors (or comparable title), 60 days for executive
directors (or comparable title) and 30 days for vice presidents (or
comparable title). Please note that in some cases, individuals may have
specific agreements providing for longer notice periods than those stated
above. In those cases, the longer notice period shall apply.

	 	 	 

	 	 	After receipt of such notice, the Firm may choose to have you continue to
provide services during the applicable Special Notice Period or may place
you on a paid leave for all or part of the applicable Special Notice
Period. During the Special Notice Period, you shall continue to devote
your full time and loyalty to the Firm by providing services in a
cooperative and professional manner and not perform any services for any
other employer and shall receive your base salary and certain benefits
until your employment terminates. You and the Firm may mutually agree to
waive or modify the length of the Special Notice Period.

	 	 	 

	 	 	Regardless of whether the Special Notice Period applies to you, you must
comply with the 90-day advance notice period described under “Full Career
Eligibility” in the event you wish to terminate employment under the Full
Career Eligibility provision.







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January 20, 2009 Stock Appreciation Rights — Operating Committee (continued)

 






	 	 	 
	Remedies
	 	In addition to the cancellation of the award as provided for in
“Termination of Employment” and “Termination for Cause,” if the Firm in its
sole discretion determines that (i) you are not in compliance with any of
the advance notice/cooperation requirements or employment restrictions
applicable to your termination of employment, or (ii) you have not returned
the applicable release of claims or other documents specified above within
the specified deadline, or (iii) you violated any of the provisions as set
forth above in “Your Obligations,” all outstanding Stock Appreciation
Rights under your award and any shares that are subject to the restriction
on disposition of shares described above will be immediately cancelled.

	 	 	 

	 	 	In addition, if you received shares under this award resulting from an
exercise during the one year prior to (i) the violation of any of the
provisions as set forth above in “Your Obligations” or (ii) the termination
of your employment for “Cause” as described under “Termination for Cause,”
including a later determination by the Firm that your employment could have
been terminated for Cause (in which case the one year will be measured from
your actual termination date), you will be required to pay the Firm
liquidated damages by returning to the Firm an amount equal to the gain on
exercise (as of the exercise date), less withholding taxes. Payment may be
made in shares of Common Stock or in cash.

	 	 	 

	 	 	You agree that this payment will be liquidated damages and is not to be
construed in any manner as a penalty. You acknowledge that a violation or
attempted violation of the obligations set forth herein will cause
immediate and irreparable damage to the Firm, and therefore agree that the
Firm shall be entitled as a matter of right to an injunction, from any
court of competent jurisdiction, restraining any violation or further
violation of such obligations; such right to an injunction, however, shall
be cumulative and in addition to whatever other remedies the Firm may have
under law or equity. In any action or proceeding by the Firm to enforce
the terms and conditions of this Award Agreement where the Firm is the
prevailing party, the Firm shall be entitled to recover from you its
reasonable attorneys’ fees and expenses incurred in such action or
proceeding.

	 	 	 

	Administrative Provisions
	 	Binding Agreement: The Award Agreement will be binding upon any successor
in interest to JPMorgan Chase, by merger or otherwise.

	 	 	 

	 	 	Not a Contract of Employment: Nothing contained herein constitutes a
contract of employment or continued employment. Employment is at-will and
may be terminated by either you or JPMorgan Chase for any reason at any
time. This award does not confer any right or entitlement to, nor does the
award impose any obligation on the Firm to provide, the same or any similar
award in the future.

	 	 	 

	 	 	Exercise Procedures/Withholding Taxes: The exercise of Stock Appreciation
Rights shall be in accordance with the Firm’s procedures for exercises of
such awards. The date of exercise shall be the date when the properly
completed notice of exercise is received and accepted by the Firm or its
designee in accordance with the Firm’s procedures.

	 	 	 

	 	 	Following each exercise, the Firm will retain from each distribution the
number of shares of Common Stock required to satisfy applicable tax
obligations (including, to the extent legally permissible, recovery by the
Firm of fringe benefit taxes). If, according to local country tax
regulations, a withholding tax liability arises at a time after the date of
exercise, JPMorgan Chase may implement any procedures necessary to ensure
that the withholding obligation is fully satisfied, including, but not
limited to, restricting transferability of the shares.

	 	 	 

	 	 	Assignment or Transfer: Except as otherwise provided in this Award
Agreement, ,Stock Appreciation Rights shall not be assignable or
transferable or subject to any lien, obligation or liability. You may make
a gift of unexpired, unexercised Stock Appreciation Rights, subject to the
Firm’s prior consent, to an immediate family member or a trust (or similar
vehicle) for the benefit of these immediate family members (or
beneficiaries) as defined below. JPMorgan







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January 20, 2009 Stock Appreciation Rights — Operating Committee (continued)

 






	 	 	 
	 	 	Chase may condition its prior
consent to receipt of an agreement by you and proposed transferee
containing such terms and conditions and undertakings as JPMorgan Chase
deems appropriate in its sole and absolute discretion. No attempted
transfer will be valid without the Firm’s prior consent. “Immediate family
members” include your parents, parents-in-law, children (including adopted
children), grandchildren, and siblings or a trust exclusively for the
benefit of one or more of these immediate family members. Your spouse is an
Immediate Family Member but only if Stock Appreciation Rights are
transferred to a trust (or similar vehicle) for the benefit of such spouse,
which trust includes one or more other Immediate Family Members as
beneficiaries.

	 	 	 

	 	 	Right to Set Off: The Firm may, to the maximum extent permitted by
applicable law, retain for itself funds or securities otherwise payable to
you pursuant to this award to satisfy any obligation or debt that you owe
to the Firm. Other than in the case of forfeiture or cancellation of an
award, the Firm may not retain such funds or securities until such time as
they would otherwise be distributable to you in accordance with the Award
Agreement.

	 	 	 

	 	 	Cancellation/Substitution: JPMorgan Chase may, in its sole discretion and
for any reason, cancel outstanding unexercised Stock Appreciation Rights
and substitute an equal number of non-qualified stock options to purchase
the same number of shares of common stock of JPMorgan Chase represented by
the cancelled Stock Appreciation Rights. Such substituted options shall
have the same exercise price, Expiration Date and other terms and
conditions that were applicable to the Stock Appreciation Rights; provided
that the method of exercise and the payment of exercise price, as well as
the method of payment of withholding taxes, may be changed by JPMorgan
Chase.

	 	 	 

	 	 	Change in Outstanding Shares: 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 will make an equitable
substitution or proportionate adjustment, in the number or kind of shares
of Common Stock or other securities issued or reserved for issuance
pursuant to the Plan and to any Stock Appreciation Rights (including but
not to limited to their Exercise Price) outstanding under this award for
such corporate events.

	 	 	 

	 	 	Interpretation/Administration: The Director Human Resources has sole and
complete authority to interpret and administer this Award Agreement,
including, without limitation, the power to (i) interpret the Plan and the
terms of this Award Agreement; (ii) determine the reason for termination of
employment and application of the post-employment obligations; (iii) decide
all claims arising with respect to this Award; and (iv) delegate such
authority as he deems appropriate. Any determination by the Director Human
Resources shall be binding on all parties.

	 	 	 

	 	 	Notwithstanding anything herein to the contrary, the Firm’s determinations
under the Plan and the Award Agreements are not required to be uniform. By
way of clarification, the Firm shall be entitled to make non-uniform and
selective determinations and modifications under Award Agreements and the
Plan.

	 	 	 

	 	 	Amendment: The Firm by action of its Director Human Resources reserves the
right to amend this Award Agreement in any manner, at any time and for any
reason so long as there has not been a change in control of JPMorgan
Chase, as such term is defined by the JPMorgan Chase Board of Directors
from time to time. After a change in control of JPMorgan Chase, this Award
Agreement may not be amended in any way that is adverse to your interests
without your prior written consent. This Award Agreement may not be amended
except in writing signed by the Director Human Resources JPMorgan Chase.

	 	 	 

	 	 	Severability: If any portion of the Award Agreement is found to be
unenforceable, any court of competent jurisdiction may reform the
restrictions (e.g. as to length of service, geographical area







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January 20, 2009 Stock Appreciation Rights — Operating Committee (continued)

 






	 	 	 
	 	 	or scope) to
the extent required to make the provision enforceable under applicable law.

	 	 	 

	 	 	Governing Law: By accepting this award, you are agreeing (i) to the
extent not preempted by federal law, the laws of the state of New York
(without reference to conflict of law principles) will apply to the award
and the Plan;(ii) to waive the right to a jury trial with respect to any
judicial proceeding brought in connection with this award; and (iii) that
any dispute related to this award shall be submitted to arbitration in
accordance with the rules of the American Arbitration Association, if so
elected by the Firm in its sole discretion.

	 	 	 

	Definitions
	 	“Cause” means a determination by the Firm that your employment terminated
as a result of your (i) violation of any law, rule or regulation (including
rules of self-regulatory bodies) related to the Firm’s business; (ii)
indictment or conviction of a felony; (iii) commission of a fraudulent act;
(iv) violation of the JPMorgan Code of Conduct or other Firm policies or
misconduct related to your duties to the Firm (other than an immaterial
and inadvertent violation or misconduct); (v) inadequate performance of
the duties associated with your position or job function or failure to
follow reasonable directives of your manager; or (vi) any act or failure to
act that is or might reasonably be expected to be injurious to the
interests of the Firm or its relationship with a customer, client or
employee.

	 	 	 

	 	 	“Financial Services Company” means a business enterprise that employs you
in any capacity (as an employee, contractor, consultant, advisor,
self-employed individual, etc. whether paid or unpaid) and engages in:

	 	 	 

	 	 	•   commercial or retail banking, including, but not limited to,
commercial, institutional and personal trust, custody and/or lending and
processing services, originating and servicing mortgages, issuing and
servicing credit cards;

	 	 	 

	 	 	•   insurance , including but not limited to, guaranteeing against
loss, harm damage, illness, disability or death, providing and issuing
annuities, acting as principal, agent or broker for purpose of the
forgoing;

	 	 	 

	 	 	•   financial, investment or economic advisory services, including but
not limited to, investment banking services (such as advising on mergers or
dispositions, underwriting, dealing in, or making a market in securities or
other similar activities), brokerage services, investment management
services, asset management services, and hedge funds;

	 	 	 

	 	 	•   issuing, trading or selling instruments representing interests in
pools of assets or in derivatives instruments;

	 	 	 

	 	 	•   advising on, or investing in, private equity or real estate, or

	 	 	 

	 	 	•   any similar activities that JPMorgan Chase determines in its sole
discretion constitutes financial services.

	 	 	 

	 	 	“Not-for-Profit Organization” means an entity exempt from tax under state
law and under Section 501(c) (3) of the Internal Revenue Code. Section
501(c) (3) includes entities organized and operated exclusively for
religious, charitable, scientific, testing for public safety, literary or
educational purposes, or to foster national or international amateur sports
competition or for the prevention of cruelty to children or animals.

	 	 	 

	 	 	“Recognized Service” means the period of service as an employee set forth
in the Firm’s applicable service-related policies.








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