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Preheat oven to 350°F. Bring chicken stock to boil in large saucepan. Stir in grits. Reduce heat to low; simmer 5 minutes, stirring occasionally.
Meanwhile, melt butter in large skillet on medium heat. Add onion; cook and stir 5 minutes or until tender. Remove from heat. Add grits, cheese, eggs, water, jalapeño pepper, red pepper and black pepper; mix well. Spoon into lightly greased 13x9-inch baking dish.
Bake 30 minutes or until set.