JPMorgan Chase & Co.
J P MORGAN CHASE & CO (Form: FWP, Received: 01/30/2009 06:00:54)

February 2009

Preliminary Terms No. 4

Registration Statement No. 333-155535

Dated January 29, 2009

Filed pursuant to Rule 433


STRUCTURED INVESTMENTS
Opportunities in Equities

PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

PLUS offer leveraged exposure to a wide variety of assets and asset classes, including equities, commodities and currencies. These investments are designed to allow investors to capture enhanced returns relative to the asset’s actual positive performance. The leverage typically applies only for a certain range of price performance. In exchange for enhanced performance in that range, investors generally forgo performance above a specified maximum return. At maturity, an investor will receive an amount in cash that may be more or less than the principal amount based upon the closing value of the asset at maturity.

SUMMARY TERMS  
Issuer: JPMorgan Chase & Co.
Maturity date: March 26, 2010, subject to adjustment for certain market disruption events and as described under “Description of PLUS — Payment at Maturity” in the accompanying product supplement no. MS-1-A-III.
Underlying index: S&P 500 ® Index (the “Index”)
Aggregate principal amount: $
Payment at maturity: If final index value is greater than initial index value, for each $10 principal amount PLUS,
       $10 + leveraged upside payment
        In no event will the payment at maturity exceed the maximum payment at maturity.
  If final index value is less than or equal to initial index value, for each $10 principal amount PLUS,
       $10 x index performance factor
        This amount will be less than or equal to the stated principal amount of $10 per PLUS, but will not be less than zero.
Leveraged upside payment: $10 x leverage factor x index percent increase
Index percent increase: (final index value – initial index value) / initial index value
Initial index value: The index closing value of the underlying index on the pricing date
Final index value: The index closing value on the valuation date
Valuation date: March 23, 2010, subject to adjustment for certain market disruption events and as described under “Description of PLUS — Payment at Maturity” in the accompanying product supplement no. MS-1-A-III.
Leverage factor: 300 %
Index performance factor: final index value / initial index value
Maximum payment at maturity: $12.50 to $13.00 (125% to 130% of the stated principal amount) per PLUS
Stated principal amount: $10 per PLUS
Issue price: $10 per PLUS (see “Commissions and Issue Price” below)
Pricing date: February      , 2009 (expected to price on or about February 20, 2009)
Original issue date: February      , 2009 (5 business days after the pricing date)
CUSIP: 46625H449
Listing: The PLUS will not be listed on any securities exchange.
Agent: J.P. Morgan Securities Inc. (“JPMSI”)
Commissions and Issue Price: Price to Public (1)(2) Fees and Commissions (2)(3) Proceeds to Company
                                      Per PLUS $10 $0.20 $9.80
                                      Total $ $ $

(1)

The price to the public includes the estimated cost of hedging our obligations under the PLUS through one or more of our affiliates, which includes our affiliates’ expected cost of providing such hedge as well as the profit our affiliates expect to realize in consideration for assuming the risks inherent in providing such hedge. For additional related information, please see “Use of Proceeds” beginning on PS-14 of the accompanying product supplement no. MS-1-A-III.

(2)

The actual price to public and commissions for a particular investor may be reduced for volume purchase discounts depending on the aggregate amount of PLUS purchased by that investor. The lowest price payable by an investor is $9.95 per PLUS. Please see “Syndicate Information” on page 5 for further details.

(3)

JPMSI, acting as agent for JPMorgan Chase & Co., will receive a commission and will use all of that commission to allow selling concessions to Morgan Stanley & Co. Incorporated (“MS & Co.”) that will depend on market conditions on the pricing date. In no event will the commission received by JPMSI and the selling concessions to be allowed to MS & Co., exceed $0.20 per $10 principal amount PLUS. See “Underwriting” beginning on page PS-40 of the accompanying product supplement no. MS-1-A-III.

Investing in the PLUS involves a number of risks. See “Risk Factors” on page PS-6 of the accompanying product supplement no. MS-1-A-III and “Risk Factors” beginning on page 9 of these preliminary terms.

Neither the Securities and Exchange Commission (the “SEC”) nor any state securities commission has approved or disapproved of the PLUS or passed upon the accuracy or the adequacy of this document or the accompanying prospectus supplement and prospectus. Any representation to the contrary is a criminal offense.

The PLUS are not bank deposits and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency, nor are they obligations of, or guaranteed by, a bank. The notes are not guaranteed under the Federal Deposit Insurance Corporation’s Temporary Liquidity Guarantee Program.

Y OU SHOULD READ THIS DOCUMENT TOGETHER WITH THE RELATED PRODUCT SUPPLEMENT NO . MS-1-A-III, PROSPECTUS SUPPLEMENT AND PROSPECTUS , EACH OF WHICH CAN BE ACCESSED VIA THE HYPERLINKS BELOW , BEFORE YOU DECIDE TO INVEST .

Product supplement no. MS-1-A-III dated January 29, 2009: http://www.sec.gov/Archives/edgar/data/19617/000089109209000361/e34259_424b2.pdf
Prospectus supplement dated November 21, 2008: http://www.sec.gov/Archives/edgar/data/19617/000089109208005661/e33600_424b2.pdf
Prospectus dated November 21, 2008: http://www.sec.gov/Archives/edgar/data/19617/000089109208005658/e33655_424b2.pdf

The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in this offering will arrange to send you the prospectus if you request it by calling toll-free (866) 477-4776.



PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

Investment Overview
Performance Leveraged Upside Securities

The S&P 500 ® Index PLUS (the “PLUS”) can be used:

The PLUS are exposed on a 1:1 basis to the negative performance of the underlying index.

Maturity: 13 months
Leverage factor: 300%
Maximum payment at maturity: $12.50 to $13.00 (125% to 130% of the stated principal amount)
Principal protection: None

S&P 500 ® Index Overview

The S&P 500 ® Index, which is calculated, maintained and published by Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., consists of 500 component stocks selected to provide a performance benchmark for the U.S. equity markets. The calculation of the S&P 500 ® Index is based on the relative value of the float adjusted aggregate market capitalization of the 500 component companies as of a particular time as compared to the aggregate average market capitalization of the 500 similar companies during the base period of the years 1941 through 1943.

Information as of market close on January 28, 2009

Bloomberg Ticker Symbol: SPX
Current Index Level: 874.09
52 Weeks Ago: 1353.97
52 Week High (on 5/19/2008): 1426.63
52 Week Low (on 11/20/2008): 752.44

Underlying Index Historical Performance – End of Week Values
January 2, 2004 to January 23, 2009

February 2009 Page 2



PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

Key Investment Rationale

This 13 month investment offers 300% leveraged upside, subject to a maximum payment at maturity of $12.50 to $13.00 (125% to 130% of the stated principal amount).

Investors can use the PLUS to triple returns up to the maximum payment at maturity, while maintaining similar risk as a direct investment in the underlying index.

Leverage
Performance
The PLUS offer investors an opportunity to capture enhanced returns relative to a direct investment in the underlying index within a certain range of price performance.

Best Case Scenario

The underlying index increases in value and, at maturity, you will receive the maximum payment at maturity of $12.50 to $13.00 (125% to 130% of the stated principal amount).

Worst Case
Scenario

The underlying index declines in value and, at maturity, you will receive less than the stated principal amount by an amount proportional to the decline.


Summary of Selected Key Risks (see page 8)

February 2009 Page 3



PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

Fact Sheet

The PLUS offered are senior unsecured obligations of JPMorgan Chase & Co., will pay no interest, do not guarantee any return of principal at maturity and have the terms described in the product supplement no. MS-1-A-III, the prospectus supplement and the prospectus, as supplemented or modified by these preliminary terms. At maturity, an investor will receive for each stated principal amount of PLUS that the investor holds, an amount in cash that may be more or less than the stated principal amount based upon the closing value of the underlying index at maturity. The PLUS are senior notes issued as part of JPMorgan Chase & Co.’s Series E Medium-Term Notes program.

Expected Key Dates    
Pricing date: Original issue date (settlement date): Maturity date:
February   , 2009 (expected to price on or about February 20, 2009) February   , 2009 (5 business days after the pricing date) March 26, 2010 , subject to postponement due to a market disruption event and as described under “Description of PLUS — Payment at Maturity” in the accompanying product supplement no. MS-1-A-III.

Key Terms    
Issuer: JPMorgan Chase & Co.
Underlying index: S&P 500 ® Index (the “Index”)
Underlying index publisher: Standard & Poor’s, a Division of The McGraw-Hill Companies, Inc.
Issue price: $10 per PLUS (see “Syndicate Information” on page 5)
Stated principal amount: $10 per PLUS
Denominations: $10 per PLUS and integral multiples thereof
Interest: None
Payment at maturity: If final index value is greater than initial index value, for each $10 principal amount PLUS,
          $10 + leveraged upside payment
          In no event will the payment at maturity exceed the maximum payment at maturity.
  If final index value is less than or equal to initial index value, for each $10 principal amount PLUS,
          $10 x index performance factor
          This amount will be less than or equal to the stated principal amount of $10 per PLUS, but will not be less than zero.
Leveraged upside payment: $10 x leverage factor x index percent increase
Index percent increase: (final index value – initial index value) / initial index value
Leverage factor: 300%
Index performance factor: final index value / initial index value
Initial index value: The index closing value of the underlying index on the pricing date as published on Bloomberg under the ticker symbol “SPX” or any successor symbol.
Final index value: The index closing value of the underlying index on the valuation date as published on Bloomberg under the ticker symbol “SPX” or any successor symbol.
Valuation date: March 23, 2010, subject to adjustment for certain market disruption events.
Maximum payment at maturity: $12.50 to $13.00 (125% to 130% of the stated principal amount) per PLUS
Postponement of maturity date: If the scheduled maturity date is not a business day, then the maturity date will be the following business day. If the scheduled valuation date is not a trading day or if a market disruption event occurs on that day so that the valuation date as postponed falls less than three business days prior to the scheduled maturity date, the maturity date of the PLUS will be postponed until the third business day following the valuation date as postponed.
Risk factors: Please see “Risk Factors” on page 8.

February 2009 Page 4



PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM
General Information  
Listing: The PLUS will not be listed on any securities exchange.
CUSIP: 46625H449
Minimum ticketing size: 100 PLUS
Tax considerations :

You should review carefully the section entitled “Certain U.S. Federal Income Tax Consequences” in the accompanying product supplement no. MS-1-A-III. Subject to the limitations described therein, and based on certain factual representations received from us, in the opinion of our special tax counsel, Davis Polk & Wardwell, your PLUS should be treated as “open transactions” for U.S. federal income tax purposes. Assuming this characterization is respected, the gain or loss on your PLUS should be treated as long-term capital gain or loss if you hold your PLUS for more than a year, whether or not you are an initial purchaser of PLUS at the issue price. However, the Internal Revenue Service (the “IRS”) or a court may not respect this characterization or treatment of the PLUS, in which case the timing and character of any income or loss on the PLUS 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, such as the PLUS. The notice focuses in particular on whether to require holders of these instruments to accrue income over the term of their investment. It also asks for comments on a number of related topics, including the character of income or loss with respect to these instruments; the relevance of factors such as the nature of the underlying property to which the instruments are linked; the degree, if any, to which income (including any mandated accruals) realized by Non-U.S. Holders should be subject to withholding tax; and whether these instruments are or should be subject to the “constructive ownership” regime, which very generally can operate to recharacterize certain long-term capital gain as ordinary income that is subject to an interest charge. While the notice requests comments on appropriate transition rules and effective dates, 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 PLUS, possibly with retroactive effect. Both U.S. and Non-U.S. Holders should consult their tax advisers regarding the U.S. federal income tax consequences of an investment in the PLUS, including possible alternative treatments and the issues presented by this notice.

Subject to certain assumptions and representations received from us, the discussion in the preceding paragraph, when read in combination with the section entitled “Certain U.S. Federal Income Tax Consequences” in the accompanying product supplement, constitutes the full opinion of Davis Polk & Wardwell regarding the material U.S. federal income tax consequences of owning and disposing of PLUS.

Trustee: Deutsche Bank Trust Company Americas (formerly Bankers Trust Company)
Calculation agent: J.P. Morgan Securities Inc. (“JPMSI”)
Use of proceeds and hedging:

The net proceeds we receive from the sale of the PLUS will be used for general corporate purposes and, in part, by us or by one or more of our affiliates in connection with hedging our obligations under the PLUS.

For further information on our use of proceeds and hedging, see “Use of Proceeds” in the accompanying product supplement no. MS-1-A-III.

ERISA: See “Benefit Plan Investor Considerations” in the accompanying product supplement no. MS-1-A-III.
Contact: Morgan Stanley clients may contact their local Morgan Stanley branch office or Morgan Stanley’s principal executive offices at 1585 Broadway, New York, New York 10036 (telephone number (866) 477-4776).


Syndicate Information          
Issue price of the PLUS Commissions Principal amount of PLUS
for any single investor
$10.0000 $0.2000 <$999K
$9.9750 $0.1750 $1MM-$2.99MM
$9.9625 $0.1625 $3MM-$4.99MM
$9.9500 $0.1500 ≥$5MM

This offering summary represents a summary of the terms and conditions of the PLUS. We encourage you to read the accompanying product supplement no. MS-1-A-III, the prospectus supplement and prospectus for this offering, which can be accessed via the hyperlinks on the front page of this document.

February 2009 Page 5


PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

How PLUS Work

Payoff Diagram

The payoff diagram below illustrates the payment at maturity on the PLUS based on the following terms:

Stated principal amount: $10
Leverage factor: 300%
Hypothetical maximum payment at maturity: $12.50 (125% of the stated principal amount)

PLUS Payoff Diagram

How it works

February 2009 Page 6



PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

Payment at Maturity

At maturity, investors will receive for each $10 stated principal amount of PLUS that they hold an amount in cash based upon the value of the underlying index, determined as follows:

If the final index value is greater than the initial index value :

$ 10 + Leveraged Upside Payment:

subject to the maximum payment at maturity for each PLUS,

      Leveraged Upside Payment
Principal   Principal Leverage Index Percent Increase


If the final index value is less than or equal to the initial index value:

$ 10 × Index Performance Factor
     
Principal  
Index Performance Factor
$10 × final index value
initial index value

Because the index performance factor will be less than or equal to 1.0, this payment will be less than or equal to $10.

February 2009 Page 7


PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

Risk Factors

The following is a non-exhaustive list of certain key risk factors for investors in the PLUS. For further discussion of these and other risks, you should read the section entitled “Risk Factors” beginning on page PS-6 of the accompanying product supplement no. MS-1-A-III. We also urge you to consult your investment, legal, tax, accounting and other advisers before you invest in the PLUS.

Structure Specific Risk Factors


February 2009 Page 8



PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

the PLUS could differ materially and adversely from our description herein. 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, such as the PLUS. The notice focuses in particular on whether to require holders of these instruments to accrue income over the term of their investment. It also asks for comments on a number of related topics, including the character of income or loss with respect to these instruments; the relevance of factors such as the nature of the underlying property to which the instruments are linked; the degree, if any, to which income (including any mandated accruals) realized by Non-U.S. Holders should be subject to withholding tax; and whether these instruments are or should be subject to the “constructive ownership” regime, which very generally can operate to recharacterize certain long-term capital gain as ordinary income that is subject to an interest charge. While the notice requests comments on appropriate transition rules and effective dates, 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 PLUS, possibly with retroactive effect. Both U.S. and Non-U.S. Holders should consult their tax advisers regarding the U.S. federal income tax consequences of an investment in the PLUS, including possible alternative treatments and the issues presented by this notice. Non-U.S. Holders should note that they may be withheld upon at a rate of 30% unless they have submitted a properly completed IRS Form W-8BEN or otherwise satisfied the applicable documentation requirements. You should review carefully the section entitled “Certain U.S. Federal Income Tax Consequences” in the accompanying product supplement no. MS-1-A-III and consult your tax adviser regarding your particular circumstances.

Other Risk Factors

February 2009 Page 9


PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

Information about the Underlying Index

The S&P 500 ® Index. The S&P 500 ® Index, which is calculated, maintained and published by Standard & Poor’s, a division of The McGraw-Hill Companies, Inc. (“Standard & Poor’s), consists of 500 component stocks selected to provide a performance benchmark for the U.S. equity markets. The calculation of the S&P 500 ® Index is based on the relative value of the float adjusted aggregate market capitalization of the 500 component companies as of a particular time as compared to the aggregate average market capitalization of the 500 similar companies during the base period of the years 1941 through 1943. The S&P 500 ® Index is described under the heading “The S&P 500 ® Index” in the accompanying product supplement no. MS-1-A-III.

License Agreement between Standard & Poor’s and J.P. Morgan Securities Inc. “Standard & Poor’s ® ,” “S&P ® ,” “S&P 500 ® ” and “Standard & Poor’s 500” are trademarks of The McGraw-Hill Companies, Inc. and have been licensed for use by J.P. Morgan Securities Inc. See “The S&P 500 ® Index — License Agreement with S&P” in the accompanying product supplement no. MS-1-A-III.

Historical Information

The following table sets forth the published high and low closing values, as well as end-of-quarter closing values, of the underlying index for each quarter in the period from January 2, 2004 through January 28, 2009. The closing value of the underlying index on January 28, 2009 was 874.09. We obtained the information in the table below from Bloomberg Financial Markets, without independent verification. The historical values of the underlying index should not be taken as an indication of future performance, and no assurance can be given as to the level of the underlying index on the valuation date. The payment of dividends on the stocks that constitute the underlying index are not reflected in its level and, therefore, have no effect on the calculation of the payment at maturity.

S&P 500 ® Index High Low Period End
          2004      
         First Quarter 1,157.76 1,091.33 1,126.21
         Second Quarter 1,150.57 1,084.10 1,140.84
         Third Quarter 1,129.30 1,063.23 1,114.58
         Fourth Quarter 1,213.55 1,094.81 1,211.92
          2005      
         First Quarter 1,225.31 1,163.75 1,180.59
         Second Quarter 1,216.96 1,137.50 1,191.33
         Third Quarter 1,245.04 1,194.44 1,228.81
         Fourth Quarter 1,272.74 1,176.84 1,248.29
          2006      
         First Quarter 1,307.25 1,254.78 1,294.83
         Second Quarter 1,325.76 1,223.69 1,270.20
         Third Quarter 1,339.15 1,234.49 1,335.85
         Fourth Quarter 1,427.09 1,331.32 1,418.30
          2007      
         First Quarter 1,459.68 1,374.12 1,420.86
         Second Quarter 1,539.18 1,424.55 1,503.35
         Third Quarter 1,553.08 1,406.70 1,526.75
         Fourth Quarter 1,565.15 1,407.22 1,468.36
          2008      
         First Quarter 1,447.16 1,273.37 1,322.70
         Second Quarter 1,426.63 1,278.38 1,280.00
         Third Quarter 1,305.32 1,106.39 1,166.36
         Fourth Quarter 1,161.06 752.44 903.25
          2009      
         First Quarter (through January 28, 2009) 934.70 805.22 874.09

February 2009 Page 10



PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

Supplemental Plan of Distribution

We expect that delivery of the PLUS will be made against payment for the PLUS on or about the issue date set forth on the front cover of this preliminary terms, which will be the fifth business day following the pricing date of the PLUS (this settlement cycle being referred to as T+5). Under Rule 15c6-1 under the Securities Exchange Act of 1934, as amended, trades in the secondary market generally are required to settle in three business days, unless the parties to that trade expressly agree otherwise. Accordingly, purchasers who wish to trade PLUS on the pricing date or the succeeding business day will be required to specify an alternate settlement cycle at the time of any such trade to prevent a failed settlement and should consult their own advisors.

Subject to regulatory constraints, JPMSI intends to use its reasonable efforts to offer to purchase the PLUS in the secondary market, but is not required to do so.

We or our affiliate may enter into swap agreements or related hedge transactions with one of our other affiliates or unaffiliated counterparties in connection with the sale of the PLUS and JPMSI and/or an affiliate may earn additional income as a result of payments pursuant to the swap or related hedge transactions. See “Use of Proceeds” beginning on page PS-14 of the accompanying product supplement no. MS-1-A-III.

February 2009 Page 11



PLUS Based on the Value of the S&P 500 ® Index due March 26, 2010
Performance Leveraged Upside Securities SM

Where You Can Find More Information?

You may revoke your offer to purchase the PLUS 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 PLUS prior to their issuance. In the event of any changes to the terms of the PLUS, 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.

You should read this document together with the prospectus dated November 21, 2008, as supplemented by the prospectus supplement dated November 21, 2008 relating to our Series E medium-term notes of which these PLUS are a part, and the more detailed information contained in product supplement no. MS-1-A-III dated January 29, 2009.

This document, together with the documents listed below, contains the terms of the PLUS 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, stand-alone 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. MS-1-A-III, as the PLUS 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 PLUS.

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 document, the “Company,” “we,” “us,” or “our” refers to JPMorgan Chase & Co.

“Performance Leveraged Upside Securities SM ” and “PLUS SM ” are service marks of Morgan Stanley.

February 2009 Page 12