|
Supplemental
term sheet†
To
prospectus dated December 1, 2005,
prospectus
supplement dated October 12, 2006 and
product
supplement no. 34-VI dated February 28, 2008
 |
Supplemental
term sheet to
Product
Supplement No. 34-VI
Registration
Statement No. 333-130051
Dated
May 13, 2008; Rule 433
|
|
Structured
Investments
|
JPMorgan
Chase & Co.
$
Reverse
Exchangeable Notes due December 1, 2008
Linked
to the Common Stock of a Single Reference Stock
Issuer
|
General
|
·
|
This
supplemental term sheet relates to one (1) note offering. The notes
are
linked to one, and only one, Reference Stock.
|
|
·
|
The
notes are
designed for investors who seek an interest rate that is higher
than the
current dividend yield on the Reference Stock or the yield on a
conventional debt security with the same maturity issued by us
or an
issuer with a comparable credit rating. Investors should be willing
to
forgo the potential to participate in the appreciation of the Reference
Stock, be willing to accept the risks of owning the common stock
of the
Reference Stock issuer, and be willing to lose some or all of their
principal at maturity.
|
|
·
|
Investing
in
the notes is not equivalent to investing in the shares of the Reference
Stock issuer.
|
|
·
|
The
notes
will pay interest monthly at the fixed rate specified below. However,
the
notes do not guarantee any return of principal at
maturity.
Instead,
the payment at maturity will be based on the Final Share Price
of the
Reference Stock and whether the closing price of the Reference
Stock has
declined from the Initial Share Price by more than the Protection
Amount
during the Monitoring Period, as described
below.
|
|
·
|
Payment
at
maturity for each $1,000 principal amount note will be either a
cash
payment of $1,000 or delivery of shares of the Reference Stock
(or, at our
election, the Cash Value thereof), in each case, together with
any accrued
and unpaid interest, as described
below.
|
|
·
|
Minimum
denominations of $1,000 and integral multiples
thereof.
|
Key
Terms
|
Payment
at
Maturity:
|
The
payment
at maturity, in excess of any accrued and unpaid interest, is based
on the
performance of the Reference Stock. You will receive $1,000 for each
$1,000 principal amount note, plus any accrued and unpaid interest
at
maturity, unless:
(1)
the
Final
Share Price is less than the Initial Share Price; and
(2)
on
any day
during the Monitoring Period, the closing
price
of the
Reference Stock has declined, as compared to the Initial Share Price,
by
more than the Protection Amount.
If
the
conditions described in both (1) and (2) are satisfied, at maturity
you
will receive, in addition to any accrued and unpaid interest, instead
of
the principal amount of your notes, the number of shares of the Reference
Stock equal to the Physical Delivery Amount (or, at our election,
the Cash
Value thereof). Fractional shares will be paid in cash. The
market value of the Physical Delivery Amount or the Cash Value thereof
will most likely be substantially less than the principal amount
of your
notes, and may be zero.
|
|
Maturity
Date:
|
December
1, 2008*
|
|
Pricing
Date:
|
On
or about
May 27, 2008
|
|
Settlement
Date:
|
On
or about
May 30, 2008
|
|
Observation
Date:
|
November
25,
2008*
|
|
Interest
Payment Dates:
|
Interest
on
the notes will be payable monthly in arrears on the last calendar
day of
each month, except for the final interest payment, which shall be
payable
on the Maturity Date (each such date, an “Interest Payment Date”),
commencing June 30, 2008, to and including the Interest Payment Date
corresponding to the Maturity Date. See “Selected Purchase
Considerations — Monthly Interest Payments” in this term sheet for
more information.
|
|
Monitoring
Period:
|
The
period
from the Pricing Date to and including the Observation Date.
|
|
Physical
Delivery Amount:
|
The
number of
shares of the Reference Stock, per $1,000 principal amount note,
equal to
$1,000 divided by the Initial Share Price, subject to
adjustments.
|
|
Cash
Value:
|
The
amount in
cash equal to the product of (1) $1,000 divided by the Initial Share
Price
of the Reference Stock and (2) the Final Share Price of the Reference
Stock, subject to adjustments.
|
|
Initial
Share
Price:
|
The
closing
price of the Reference Stock on the Pricing Date. The Initial Share
Price
is subject to adjustments in certain circumstances. See “Description of
Notes — Payment at Maturity” and “General Terms of Notes —
Anti-dilution Adjustments” in the accompanying product supplement no.
34-VI for further information about these adjustments.
|
|
Final
Share
Price:
|
The
closing
price of the Reference Stock on the Observation
Date.
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|
Approximate
Tax Allocation of
Monthly
Coupon††
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||||||||||||
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Page
Number
|
Ticker
Symbol
|
Principal
Amount
|
Interest
Rate
|
Protection
Amount
|
Initial
Share
Price
|
CUSIP
|
Approximate
Monthly
Coupon
|
Interest
on
Deposit
|
Put
Premium
|
|||
|
Bank
of
America Corporation
|
TS-3
|
BAC
|
6.25%
(equivalent to 12.50% per annum)
|
20%
of the
Initial Share Price
|
48123MZ70
|
$10.42
|
22.40%
|
77.60%
|
||||
|
*
|
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.
34-VI.
|
|
†
|
This
supplemental term sheet supplements the term sheet dated May 6, 2008
to
product supplement no. 34-VI but does not supersede the term sheet.
|
|
††
|
Based
on one
reasonable treatment of the notes, as described herein under “Selected
Purchase Considerations — Tax Treatment as a Unit Comprising a Put
Option and a Deposit” and in the accompanying product supplement no. 34-VI
under “Certain U.S. Federal Income Tax Consequences” on page PS-28. The
allocations presented herein were determined as of May 5, 2008; the
actual
allocations will be determined as of the Pricing Date and may
differ.
|
Investing
in the Reverse Exchangeable Notes involves a number of risks. See “Risk Factors”
beginning on page PS-6 of the accompanying product supplement no. 34-VI and
“Selected Risk Considerations” beginning on page TS-2 of this supplemental 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
supplemental 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. 34-VI and this supplemental 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 SEC nor
any state securities commission has approved or disapproved of the notes or
passed upon the accuracy or the adequacy of this supplemental 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
|
|
|
Per
note
|
$
|
$
|
$
|
|
Total
|
$
|
$
|
$
|
|
(1)
|
In
no event
will the fees and commissions received by J.P. Morgan Securities
Inc.,
which we refer to as JPMSI, which include concessions to be allowed
to
other dealers, exceed $60.00 per $1,000 principal amount note. For
more
detailed information about fees, commissions and concessions, please
see
“Supplemental Underwriting Information” on the last page of this
supplemental term sheet.
|
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
May
13,
2008
Additional
Terms Specific to the Notes
This
supplemental term sheet relates to one (1) note offering. The purchaser of
a
note will acquire a security linked to the Reference Stock.
We
reserve the
right to withdraw, cancel or modify the offering and to reject orders in whole
or in part. While this note offering relates to only the Reference Stock
identified on the cover page, you should not construe that fact as a
recommendation of the merits of acquiring an investment linked to that Reference
Stock or as to the suitability of an investment in the notes.
You
should read
this supplemental 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. 34-VI
dated February 28, 2008. This
supplemental
term
sheet, together with the documents listed below, contains the terms of the
notes
and,
except as set forth in the next sentence,
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.
This supplemental term sheet supplements the term sheet dated May 6, 2008 to
product supplement no. 34-VI but does not supersede the term sheet. You may
rely
on the information contained in this term sheet or the term sheet dated May
6,
2008 and in the documents listed below in making your decision to invest in
the
notes. You
should
carefully consider, among other things, the matters set forth in “Risk Factors”
in the accompanying product supplement no. 34-VI, 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):
|
·
|
Product
supplement no. 34-VI dated February
28,
2008:
|
|
·
|
Prospectus
supplement dated October 12, 2006:
|
|
·
|
Prospectus
dated December 1, 2005:
|
Our
Central Index
Key, or CIK, on the SEC website is 19617. As used in this supplemental term
sheet, the “Company,” “we,” “us” or “our” refers to JPMorgan Chase &
Co.
Selected
Purchase Considerations
|
·
|
THE
NOTES OFFER A HIGHER INTEREST RATE THAN THE YIELD ON DEBT SECURITIES
OF
COMPARABLE MATURITY ISSUED BY US OR AN ISSUER WITH A COMPARABLE CREDIT
RATING —
The
notes will pay interest at the Interest Rate indicated on the cover
of
this supplemental term sheet. We believe that the Interest Rate is
higher
than the yield received on debt securities of comparable maturity
issued
by us or an issuer with a comparable credit rating. Because the notes
are
our senior unsecured obligations, any interest payment or any payment
at
maturity is subject to our ability to pay our obligations as they
become
due.
|
|
·
|
MONTHLY
INTEREST PAYMENTS —
The
notes offer monthly interest payments at the Interest Rate set forth
on
the cover of this supplemental term sheet. Interest will be payable
monthly in arrears on the last
calendar day of each month, except for the final interest payment,
which
shall be payable on the Maturity Date (each such date, an “Interest
Payment Date”), commencing June 30, 2008, to
and
including the Interest Payment Date corresponding to the Maturity
Date,
to the holders of record at the close of business on the date 15
calendar
days prior to the applicable Interest Payment Date. If an Interest
Payment
Date is not a business day, payment will be made on the next business
day
immediately following such day, but no additional interest will accrue
as
a result of the delayed payment.
|
|
·
|
THE
NOTES DO NOT GUARANTEE THE RETURN OF YOUR
PRINCIPAL —
Your
return
of principal at maturity is protected if the Final Share Price does
not
decline from the Initial Share Price or the closing price of the
Reference
Stock does not decline, as compared to the Initial Share Price, by
more
than the Protection Amount on any day during the Monitoring Period.
However,
if the Final Share Price declines from the Initial Share Price and
the
closing price of the Reference Stock on any day during the Monitoring
Period has declined by more than the Protection Amount, you could
lose the
entire principal amount of your
notes.
|
|
·
|
TAX
TREATMENT AS A UNIT COMPRISING A PUT OPTION AND A
DEPOSIT — You
should
review carefully the section entitled “Certain U.S. Federal Income Tax
Consequences” in the accompanying product supplement no. 34-VI.
We
and you
agree (in the absence of an administrative determination or judicial
ruling to the contrary)
to treat the
notes as units comprising a Put Option and a Deposit for U.S. federal
income tax purposes. We will determine the portion of each coupon
payment
that we will allocate to interest on the Deposit and to Put Premium,
respectively, and will provide that allocation in the pricing supplement
for the notes. If the notes had priced on May 5, 2008, of each coupon
payment, we would have treated the percentages specified on the cover
of
this supplemental term sheet as interest on the Deposit and as Put
Premium, respectively. The actual allocation that we will determine
for
the notes may differ from this hypothetical allocation, and will
depend
upon a variety of factors, including actual market conditions and
our
borrowing costs for debt instruments of comparable maturities on
the
Pricing Date. Assuming this characterization is respected, amounts
treated
as interest on the Deposit will be taxed as ordinary income while
the Put
Premium will not be taken into account prior to maturity or sale.
However,
there are other reasonable treatments that the Internal Revenue Service
(the “IRS”) or a court may adopt, in which case the timing and character
of any income or loss on the notes could be significantly and adversely
affected. In addition, on December 7, 2007, Treasury and the IRS
released
a notice requesting comments on the U.S. federal income tax treatment
of
“prepaid forward contracts” and similar instruments. While it is not clear
whether the notes would be viewed as similar to the typical prepaid
forward contract described in the notice, it is possible that any
Treasury
regulations or other guidance promulgated after consideration of
these
issues could materially and adversely affect the tax consequences
of an
investment in the notes, possibly with retroactive effect. The notice
focuses on a number of issues, the most relevant of which for holders
of
the notes are the character of income or loss (including whether
the Put
Premium might be currently included as ordinary income) and the degree,
if
any, to which income realized by Non-U.S. Holders should be subject
to
withholding tax. Both U.S. and Non-U.S. Holders should consult their
tax
advisers regarding all aspects of the U.S. federal income tax consequences
of an investment in the notes, including possible alternative treatments
and the issues presented by this notice. Purchasers who are not initial
purchasers of notes at the issue price should also consult their
tax
advisers with respect to the tax consequences of an investment in
the
notes, including possible alternative characterizations, as well
as the
allocation of the purchase price of the notes between the Deposit
and the
Put Option.
|
JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference Stock
Issuer
TS-1
Selected
Risk Considerations
An
investment in the notes involves significant risks. Investing in the notes
is
not equivalent to investing directly in the Reference Stock. These risks are
explained in more detail in the “Risk Factors” section of the accompanying
product supplement no. 34-VI dated February 28, 2008.
|
·
|
YOUR
INVESTMENT IN THE NOTES MAY RESULT IN A LOSS —
The
notes do not guarantee any return of principal. The payment at maturity
will be based on the Final Share Price and whether the closing price
of
the Reference Stock has declined from the Initial Share Price by
more than
the Protection Amount on any day during the Monitoring Period. Under
certain circumstances, you will receive at maturity a predetermined
number
of shares of the Reference Stock (or, at our election, the Cash Value
thereof). The market value of those shares of the Reference Stock
or the
Cash Value thereof will most likely be less than the principal amount
of
each note and may be zero. Accordingly,
you could lose up to the entire principal amount of your
notes.
|
|
·
|
YOUR
PROTECTION MAY TERMINATE ON ANY DAY DURING THE TERM OF THE
NOTES —
If,
on any
day during the Monitoring Period, the closing price of the Reference
Stock
declines below the Initial Share Price minus the Protection Amount,
you
will at maturity be fully exposed to any depreciation in the Reference
Stock. We refer to this feature as a contingent buffer. Under these
circumstances, and
if the Final
Share Price is less than the Initial Share Price, you will receive
at
maturity a predetermined number of shares of the Reference Stock
(or, at
our election, the Cash Value thereof) and, consequently, you will
lose 1%
of the principal amount of your investment for every 1% decline in
the
Final Share Price compared to the Initial Share Price. You will be
subject
to this potential loss of principal even if the price of the Reference
Stock subsequently recovers such that the Final Share Price is above
the
Initial Share Price minus the Protection Amount. If these notes had
a
non-contingent buffer feature, under the same scenario, you would
have
received the full principal amount of your notes plus accrued and
unpaid
interest at maturity. As a result, your investment in the notes may
not
perform as well as an investment in a security with a return that
includes
a non-contingent buffer.
|
|
·
|
YOUR
RETURN ON THE NOTES IS LIMITED TO THE PRINCIPAL AMOUNT PLUS ACCRUED
INTEREST REGARDLESS OF ANY APPRECIATION IN THE VALUE OF THE REFERENCE
STOCK —
Unless (i) the Final Share Price is less than the Initial Share Price
and
(ii) on any day during the Monitoring Period, the closing price of
the
Reference Stock has declined, as compared to the Initial Share Price,
by
more than the Protection Amount, for each $1,000 principal amount
note,
you will receive $1,000 at maturity plus any accrued and unpaid interest,
regardless of any appreciation in the value of the Reference Stock,
which
may be significant. Accordingly, the return on the notes may be
significantly less than the return on a direct investment in the
Reference
Stock during the term of the notes.
|
|
·
|
NO
OWNERSHIP RIGHTS IN THE REFERENCE STOCK —
As
a
holder of the notes, you will not have any ownership interest or
rights in
the Reference Stock, such as voting rights or dividend payments.
In
addition, the Reference Stock issuer will not have any obligation
to
consider your interests as a holder of the notes in taking any corporate
action that might affect the value of the Reference Stock and the
notes.
|
|
·
|
NO
AFFILIATION WITH THE REFERENCE STOCK ISSUER —
We
are not affiliated with the issuer of the Reference Stock. We assume
no
responsibility for the adequacy of the information about the Reference
Stock issuer contained in this supplemental term sheet or in product
supplement no. 34-VI. You should make your own investigation into
the
Reference Stock and its issuer. We are not responsible for the Reference
Stock issuer’s public disclosure of information, whether contained in SEC
filings or otherwise.
|
|
·
|
CERTAIN
BUILT-IN COSTS ARE LIKELY TO ADVERSELY AFFECT THE VALUE OF THE NOTES
PRIOR
TO MATURITY —
While
the payment at maturity described in this supplemental term sheet
is based
on the full principal amount of your notes, the original issue price
of
the notes includes the agent’s commission and the cost of hedging our
obligations under the notes through one or more of our affiliates.
As a
result, and as a general matter, the price, if any, at which JPMSI
will be
willing to purchase notes from you in secondary market transactions,
if at
all, will likely be lower than the original issue price and any sale
prior
to the maturity date could result in a substantial loss to you. This
secondary market price will also be affected by a number of factors
aside
from the agent’s commission and hedging costs, including those referred to
under “Many Economic and Market Factors Will Impact the Value of the
Notes” below.
|
The
notes are not
designed to be short-term trading instruments. Accordingly, you should be able
and willing to hold your notes to maturity.
|
·
|
LACK
OF LIQUIDITY — The
notes
will not be listed on any securities exchange. JPMSI intends to offer
to
purchase the notes in the secondary market but is not required to
do so.
Even if there is a secondary market, it may not provide enough liquidity
to allow you to trade or sell the notes easily. Because other dealers
are
not likely to make a secondary market for the notes, the price at
which
you may be able to trade your notes is likely to depend on the price,
if
any, at which JPMSI is willing to buy the notes.
|
|
·
|
POTENTIAL
CONFLICTS —
We
and our affiliates play a variety of roles in connection with the
issuance
of the notes, including acting as calculation agent. In performing
these
duties, the economic interests of the calculation agent and other
affiliates of ours are potentially adverse to your interests as an
investor in the notes. We and/or our affiliates may also currently
or from
time to time engage in business with the Reference Stock issuer,
including
extending loans to, or making equity investments in, the Reference
Stock
issuer or providing advisory services to the Reference Stock issuer.
In
addition, one or more of our affiliates may publish research reports
or
otherwise express opinions with respect to the Reference Stock issuer
and
these reports may or may not recommend that investors buy or hold
the
Reference Stock. As a prospective purchaser of the notes, you should
undertake an independent investigation of the Reference Stock issuer
that
in your judgment is appropriate to make an informed decision with
respect
to an investment in the notes.
|
|
·
|
HEDGING
AND TRADING IN THE REFERENCE STOCK —
While
the notes are outstanding, we or any of our affiliates may carry
out
hedging activities related to the notes, including in the Reference
Stock
or instruments related to the Reference Stock. We or our affiliates
may
also trade in the Reference Stock or instruments related to the Reference
Stock from time to time. Any of these hedging or trading activities
as of
the Pricing Date and during the term of the notes could adversely
affect
our payment to you at maturity.
|
|
·
|
MANY
ECONOMIC AND MARKET FACTORS WILL INFLUENCE THE VALUE OF THE
NOTES —
In addition
to the value of the Reference Stock and interest rates on any trading
day,
the value of the notes will be affected by a number of economic and
market
factors that may either offset or magnify each other and which are
set out
in more detail in product supplement no. 34-VI.
|
JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference Stock
Issuer
TS-2
The
Reference Stock
Public
Information
Bank
of America Corporation (“Bank of America”)
According
to its publicly available filings with the SEC, Bank
of America
provides a diversified range of banking and non-banking financial services
and
products domestically and internationally. The
common
stock of Bank of America, par value $0.01 per share, is listed on the New York
Stock Exchange, which we refer to as the Relevant Exchange for purposes of
Bank
of America in the accompanying product supplement no. 34-VI. Bank of America’s
SEC file number is 001-06523.
Historical
Information of the Common Stock of Bank of America
The
following graph
sets forth the historical performance of the common stock of Bank of America
based on the weekly closing price (in U.S. dollars) of the common stock of
Bank
of America from January 3, 2003 through May 2, 2008. The closing price of the
common stock of Bank of America on May 5, 2008 was $38.97. We obtained the
closing prices and other information below from Bloomberg Financial Markets,
without independent verification. The closing prices and this other information
may be adjusted by Bloomberg Financial Markets for corporate actions such as
public offerings, mergers and acquisitions, spin-offs, delistings and
bankruptcy. We make no representation or warranty as to the accuracy or
completeness of the information obtained from Bloomberg Financial Markets.
Since
its
inception, the price of the common stock of Bank of America has experienced
significant fluctuations. The historical performance of the common stock of
Bank
of America should not be taken as an indication of future performance, and
no
assurance can be given as to the closing prices of the common stock of Bank
of
America during the term of the notes. We cannot give you assurance that the
performance of the common stock of Bank of America will result in the return
of
any of your initial investment. We make no representation as to the amount
of
dividends, if any, that Bank of America will pay in the future. In any event,
as
an investor in the notes, you will not be entitled to receive dividends, if
any,
that may be payable on the common stock of Bank of America.
JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference Stock
Issuer
TS-3
Examples
of Hypothetical Payment at Maturity for a $1,000 Investment in the Notes Linked
to the Common Stock of Bank of America
The
following table
illustrates hypothetical payments at maturity on a $1,000 investment in the
notes linked to the common stock of Bank of America, based on a range of
hypothetical Final Share Prices of the Reference Stock and assuming that the
closing price of the Reference Stock declines in the manner set forth in the
column titled “Hypothetical lowest closing price during the Monitoring Period.”
The numbers appearing in the following table and examples have been rounded
for
ease of analysis. For this table of hypothetical payments at maturity, we have
also assumed the following:
|
·
|
the
Initial
Share Price:
|
$39.00
|
·
the Protection Amount: $7.80
|
|
·
|
the
Interest
Rate:
|
6.25%
(equivalent to 12.50% per annum)
|
|
Hypothetical
lowest
closing
price during the
Monitoring
Period
|
Hypothetical
Final
Share
Price
|
Payment
at Maturity
|
Total
Value of
Payment
Received
at
Maturity**
|
|
$39.00
|
$78.00
|
$1,000.00
|
$1,000.00
|
|
$19.50
|
$40.95
|
$1,000.00
|
$1,000.00
|
|
$39.00
|
$39.00
|
$1,000.00
|
$1,000.00
|
|
$31.20
|
$31.20
|
$1,000.00
|
$1,000.00
|
|
$19.50
|
$37.05
|
25
shares of
the Reference Stock or the
Cash
Value
thereof
|
$950.00
|
|
$19.50
|
$19.50
|
25
shares of
the Reference Stock or the
Cash
Value
thereof
|
$500.00
|
|
$9.75
|
$9.75
|
25
shares of
the Reference Stock or the
Cash
Value
thereof
|
$250.00
|
|
$0.00
|
$0.00
|
25
shares of
the Reference Stock or the
Cash
Value
thereof
|
$0.00
|
|
**
|
Note
that you
will receive at maturity any accrued and unpaid interest in cash,
in
addition to either shares of the Reference Stock (or, at our election,
the
Cash Value thereof) or the principal amount of your note in cash.
Also
note that if you receive the Physical Delivery Amount, the total
value of
payment received at maturity shown in the table above includes the
value
of any fractional shares, which will be paid in
cash.
|
The
following
examples illustrate how the total value of payments received at maturity set
forth in the table above are calculated.
Example
1:
The lowest closing price of the Reference Stock during the Monitoring Period
was
$19.50 but the Final Share Price is $40.95. Because
the Final
Share Price of $40.95 is greater than the Initial Share Price of $39.00, you
will receive a payment at maturity of $1,000 per $1,000 principal amount note.
Example
2:
The lowest closing price of the Reference Stock during the Monitoring Period
was
$19.50 and the Final Share Price is $37.05. Because
the Final
Share Price of $37.05 is less than the Initial Share Price of $39.00 and the
closing price of the Reference Stock declined by more than the Protection Amount
on at least one day during the Monitoring Period, you will receive the Physical
Delivery Amount, or at our election, the Cash Value thereof, at maturity.
Because the Final Share Price of the Reference Stock is $37.05, the total value
of your final payment at maturity, whether in cash or shares of the Reference
Stock, is $950.00.
Example
3:
The closing price of the Reference Stock does not decline, as compared with
the
Initial Share Price, by more than the Protection Amount on any day during the
Monitoring Period prior to the Observation Date. However, the closing price
of
the Reference Stock on the Observation Date is $19.50, a decline of more than
the Protection Amount. Because
the Final
Share Price of $19.50 is less than the Initial Share Price of $39.00 and the
Final Share Price has declined by more than the Protection Amount, you will
receive the Physical Delivery Amount, or at our election, the Cash Value
thereof, at maturity. Because the Final Share Price of the Reference Stock
is
$19.50, the total value of your final payment at maturity, whether in cash
or
shares of the Reference Stock, is $500.00.
Example
4:
The Final Share Price of $31.20 is less than the Initial Share Price of $39.00
but does not decline by more than the Protection Amount and the closing price
of
the Reference Stock does not decline by more than the Protection Amount on
any
day during the Monitoring Period. Because
the closing
price of the Reference Stock has not declined by more than the Protection
Amount, you will receive a payment at maturity of $1,000 per $1,000 principal
amount note, even though the Final Share Price of $31.20 is less than the
Initial Share Price of $39.00.
Regardless
of the performance of the Reference Stock or the payment you receive at
maturity, you will receive interest payments, for each $1,000 principal amount
note, in the aggregate amount of approximately $62.50 over the term of the
notes. If we had priced the notes on May 5, 2008, you would have received 25
shares of the Reference Stock or, at our election, the Cash Value thereof,
at
maturity, provided the Final Share Price declined from the Initial Share Price
and the closing price of the Reference Stock declined by more than the
Protection Amount from the Initial Share Price on at least one day during the
Monitoring Period. The actual number of shares of the Reference Stock, or the
Cash Value thereof, you may receive at maturity and the actual Protection Amount
applicable to your notes may be more or less than the amounts displayed in
this
hypothetical and will depend in part on the closing price of the Reference
Stock
on the Pricing Date.
JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference Stock
Issuer
TS-4
Supplemental
Underwriting Information
If
the notes linked to the common stock of Bank of America priced on May 6, 2008,
JPMSI, acting as agent for JPMorgan Chase & Co., would receive a commission
of approximately $35.81 per $1,000 principal amount note and would use a portion
of that commission to allow selling concessions to other dealers of
approximately $25.41 per $1,000 principal amount note. The concessions of
approximately $25.41 include concessions to be allowed to selling dealers and
concessions to be allowed to an arranging dealer. The actual commission received
by JPMSI may be more or less than $35.81 and will depend on market conditions
on
the Pricing Date. In no event will the commission received by JPMSI exceed
$60.00 per $1,000 principal amount note.
The
total aggregate principal amount of the notes being offered by this supplemental
term sheet may not be purchased by investors in this offering. Under these
circumstances, JPMSI will retain the unsold portion of the offering and has
agreed to hold the notes for investment for a period of at least 30 days. The
unsold portion of the notes will not exceed 15% of the aggregate principal
amount of the notes. Any unsold portion may affect the supply of notes available
for secondary trading and, therefore, could adversely affect the price of the
notes in the secondary market. Circumstances may occur in which our interests
or
those of our affiliates could be in conflict with your
interests.
See
“Underwriting”
beginning on page PS-34 of the accompanying product supplement no.
34-VI.
JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference Stock
Issuer
TS-5