Term Sheet |
Term Sheet
to Product Supplement No. 32-IX Registration Statement No. 333-130051 Dated March 31, 2008; Rule 433 |
Structured |
JPMorgan Chase & Co. $ Principal Protected Notes Linked to a Weighted Basket Consisting of the S&P 500® Index, the Dow Jones EURO STOXX 50® Index, the Nikkei 225 Index and the S&P GSCI Excess Return Index due April 4, 2013 |
General
Key Terms
Basket: |
The notes are linked to a weighted basket consisting of the S&P 500® Index, the Dow Jones EURO STOXX 50® Index, the Nikkei 225 Index and the S&P GSCI Excess Return Index (each a Basket Index, and together, the Basket Indices). |
Component Weightings: |
The S&P 500® Index Weighting (S&P 500 Weighting) is 40%, the Dow Jones EURO STOXX 50® Index Weighting (EURO STOXX Weighting) is 20%, the Nikkei 225 Index Weighting (Nikkei 225 Weighting) is 20% and the S&P GSCI Excess Return Index Weighting (the S&P GSCI Commodity Weighting) is 20% (each a Component Weighting, and collectively, the Component Weightings). |
Payment at Maturity: |
At maturity, you will receive a cash payment, for each $1,000 principal amount note, of $1,000 plus the Additional Amount, which may be zero. |
Additional Amount: |
The Additional Amount per $1,000 principal amount note paid at maturity will equal $1,000 x the Basket Return x the Participation Rate; provided that the Additional Amount will not be less than zero. |
Participation Rate: |
At least 115%. The actual Participation Rate will be determined on the pricing date and will not be less than 115%. |
Basket Return: |
Ending Basket Level Starting Basket Level |
Starting Basket Level: |
Set equal to 100 on the pricing date, which is expected to be on or about April 1, 2008. |
Ending Basket Level: |
The Basket Closing Level on the Observation Date. |
Basket Closing Level: |
The Basket Closing Level on any trading day will be calculated as follows: |
100 x [1 + (S&P 500 Return * S&P 500 Weighting) + (EURO STOXX Return * EURO STOXX Weighting) + (Nikkei 225 Return * Nikkei 225 Weighting) + (S&P GSCI Commodity Return * S&P GSCI Commodity Weighting)] |
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Each of the S&P 500 Return, the EURO STOXX Return, the Nikkei 225 Return and the S&P GSCI Commodity Return reflects the performance of the relevant Basket Index, expressed as a percentage, from its closing level on the pricing date to its closing level on such trading day. For additional information, see Description of Notes Payment at Maturity in the accompanying product supplement no. 32-IX. |
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Observation Date: |
April 1, 2013* |
Maturity Date: |
April 4, 2013* |
CUSIP: |
[ ] |
* |
Subject to postponement in the event of a market disruption event and as described under Description of Notes Payment at Maturity in the accompanying product supplement no. 32-IX. |
Investing in the Principal Protected Notes involves a number of risks. See Risk Factors beginning on page PS-13 of the accompanying product supplement no. 32-IX and Selected Risk Considerations beginning on page TS-1 of this term sheet.
JPMorgan Chase & Co. has filed a registration statement (including a prospectus) with the Securities and Exchange Commission, or SEC, for the offering to which this term sheet relates. Before you invest, you should read the prospectus in that registration statement and the other documents relating to this offering that JPMorgan Chase & Co. has filed with the SEC for more complete information about JPMorgan Chase & Co. and this offering. You may get these documents without cost by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, JPMorgan Chase & Co., any agent or any dealer participating in this offering will arrange to send you the prospectus, each prospectus supplement, product supplement no. 32-IX and this term sheet if you so request by calling toll-free 866-535-9248.
You may revoke your offer to purchase the notes at any time prior to the time at which we accept such offer by notifying the applicable agent. We reserve the right to change the terms of, or reject any offer to purchase the notes prior to their issuance. In the event of any changes to the terms of the notes, we will notify you and you will be asked to accept such changes in connection with your purchase. You may also choose to reject such changes in which case we may reject your offer to purchase.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the notes or passed upon the accuracy or the adequacy of this term sheet or the accompanying prospectus supplements and prospectus. Any representation to the contrary is a criminal offense.
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Price to Public |
Fees and Commissions (1) |
Proceeds to Us |
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Per note |
$ |
$ |
$ |
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Total |
$ |
$ |
$ |
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(1) |
If the notes priced today, J.P. Morgan Securities Inc., which we refer to as JPMSI, acting as agent for JPMorgan Chase & Co., would receive a commission of approximately $20 per $1,000 principal amount note and may use a portion of that commission to allow selling concessions to other dealers of approximately $1.00 per $1,000 principal amount note. [The other dealers may forgo in their sole discretion, some or all of their selling concessions.] The actual commission received by JPMSI may be more or less than $20 and will depend on market conditions on the pricing date. In no event will the commission received by JPMSI, which includes concessions that may be allowed to other dealers, exceed $22.50 per $1,000 principal amount note. See Underwriting beginning on page PS-136 of the accompanying product supplement no. 32-IX. |
The notes are not bank deposits and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency, nor are they obligations of, or guaranteed by, a bank.
JPMorgan
March 31, 2008
ADDITIONAL TERMS SPECIFIC TO THE NOTES
You should read this term sheet together with the prospectus dated December 1, 2005, as supplemented by the prospectus supplement dated October 12, 2006 relating to our Series E medium-term notes of which these notes are a part, and the more detailed information contained in product supplement no. 32-IX dated March 31, 2008. This term sheet, together with the documents listed below, contains the terms of the notes and supersedes all other prior or contemporaneous oral statements as well as any other written materials including preliminary or indicative pricing terms, correspondence, trade ideas, structures for implementation, sample structures, fact sheets, brochures or other educational materials of ours. You should carefully consider, among other things, the matters set forth in Risk Factors in the accompanying product supplement no. 32-IX, as the notes involve risks not associated with conventional debt securities. We urge you to consult your investment, legal, tax, accounting and other advisers before you invest in the notes.
You may access these documents on the SEC website at www.sec.gov as follows (or if such address has changed, by reviewing our filings for the relevant date on the SEC website):
Our Central Index Key, or CIK, on the SEC website is 19617. As used in this term sheet, the Company, we, us or our refers to JPMorgan Chase & Co.
Selected Purchase Considerations
Selected Risk Considerations
An investment in the notes involves significant risks. Investing in the notes is not equivalent to investing directly in the Basket Indices or any of the component stocks of the Basket Indices (other than the S&P GSCI Excess Return Index) or the exchange-traded futures contracts included in the S&P GSCI Excess Return Index. These risks are explained in more detail in the Risk Factors section of the accompanying product supplement no. 32-IX dated March 31, 2008.
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JPMorgan
Structured Investments
Principal Protected Notes Linked to a Weighted Basket Consisting of the S&P 500® Index, the Dow Jones EURO STOXX 50® Index, the Nikkei 225 Index and the S&P GSCI Precious Metals Index Excess Return |
TS-1 |
The following table illustrates the payment at maturity (including, where relevant, the payment of the Additional Amount) for a $1,000 principal amount note for a hypothetical range of performance for the Basket Return from -80% to +80% and assumes a Participation Rate of 115%. The following results are based solely on the hypothetical example cited. You should consider carefully whether the notes are suitable to your investment goals. The numbers appearing in the table below have been rounded for ease of analysis.
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Ending |
Basket |
Basket Return x
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Additional |
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Principal |
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Payment at |
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180 |
80% |
92.00% |
$920.00 |
+ |
$1,000 |
= |
$1,920.00 |
170 |
70% |
80.50% |
$805.00 |
+ |
$1,000 |
= |
$1,805.00 |
160 |
60% |
69.00% |
$690.00 |
+ |
$1,000 |
= |
$1,690.00 |
150 |
50% |
57.50% |
$575.00 |
+ |
$1,000 |
= |
$1,575.00 |
140 |
40% |
46.00% |
$460.00 |
+ |
$1,000 |
= |
$1,460.00 |
130 |
30% |
34.50% |
$345.00 |
+ |
$1,000 |
= |
$1,345.00 |
120 |
20% |
23.00% |
$230.00 |
+ |
$1,000 |
= |
$1,230.00 |
110 |
10% |
11.50% |
$115.00 |
+ |
$1,000 |
= |
$1,115.00 |
105 |
5% |
5.75% |
$57.50 |
+ |
$1,000 |
= |
$1,057.50 |
100 |
0% |
0.00% |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
90 |
-10% |
N/A |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
80 |
-20% |
N/A |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
70 |
-30% |
N/A |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
60 |
-40% |
N/A |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
50 |
-50% |
N/A |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
40 |
-60% |
N/A |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
30 |
-70% |
N/A |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
20 |
-80% |
N/A |
$0.00 |
+ |
$1,000 |
= |
$1,000.00 |
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JPMorgan
Structured Investments
Principal Protected Notes Linked to a Weighted Basket Consisting of the S&P 500® Index, the Dow Jones EURO STOXX 50® Index, the Nikkei 225 Index and the S&P GSCI Precious Metals Index Excess Return |
TS-2 |
Hypothetical Examples of Amounts Payable at Maturity
The following examples illustrate how the total returns set forth in the table on the previous page are calculated.
Example 1: The level of the Basket increases from the Starting Basket Level of 100 to an Ending Basket Level of 120. Because the Ending Basket Level of 120 is greater than the Starting Basket Level of 100, the Additional Amount is equal to $230 and the final payment at maturity is equal to $1,230 per $1,000 principal amount note, calculated as follows:
$1,000 + ($1,000 x [(120-100)/100] x 115%) = $1,230
Example 2: The level of the Basket decreases from the Starting Basket Level of 100 to an Ending Basket Level of 60. Because the Ending Basket Level of 60 is lower than the Starting Basket Level of 100, the final payment per $1,000 principal amount note at maturity is the principal amount of $1,000.
Example 3: The level of the Basket increases from the Starting Basket Level of 100 to an Ending Basket Level of 110. Because the Ending Basket Level of 110 is greater than the Starting Basket Level of 100, the Additional Amount is equal to $115 and the final payment at maturity is equal to $1,115 per $1,000 principal amount note, calculated as follows:
$1,000 + ($1,000 x [(110-100)/100] x 115%) = $1,115
Historical Information
The following graphs show the historical weekly performance of each Basket Index as well as the Basket as a whole from January 3, 2003 through March 28, 2008. The graph of the historical Basket performance assumes the Basket level on January 3, 2003 was 100 and that each Basket Index had the component weightings specified in this term sheet on that date. The closing level of the S&P 500® Index on March 28, 2008 was 1315.22. The closing level of the Dow Jones EURO STOXX 50® Index on March 28, 2008 was 3641.05. The closing level of the Nikkei 225 Index on March 28, 2008 was 12820.47. The closing level of the S&P GSCI Excess Return Index on March 28, 2008 was 828.0755. We obtained the various index closing levels and other information below from Bloomberg Financial Markets, and accordingly, make no representation or warranty as to their accuracy or completeness.
The historical levels of each Basket Index and the Basket should not be taken as an indication of future performance, and no assurance can be given as to the closing level of any Basket Index on the Observation Date. We cannot give you assurance that the performance of the Basket Indices will result in the return of more than the principal amount of your notes.
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JPMorgan
Structured Investments
Principal Protected Notes Linked to a Weighted Basket Consisting of the S&P 500® Index, the Dow Jones EURO STOXX 50® Index, the Nikkei 225 Index and the S&P GSCI Precious Metals Index Excess Return |
TS-3 |