Amended
and restated term sheet†
To prospectus dated December 1, 2005, prospectus supplement dated October 12, 2006 and product supplement no. 49-III dated December 17, 2007 |
Amended
and Restated term sheet to
Product
Supplement No. 49-III
Registration
Statement No. 333-130051
Dated
April 8, 2008; Rule 433
|
Structured
Investments |
JPMorgan
Chase & Co.
$ 98% Principal Protected Notes Linked to the Performance of an Equally Weighted Basket of Four Currencies Relative to the U.S. Dollar due April 14, 2009 |
· |
The
notes are
designed for investors who seek exposure to the appreciation
of an equally
weighted basket of four currencies relative to the U.S. dollar
from the
pricing date through and including the final Ending Averaging
Date.
Investors should be willing to forgo interest payments while
seeking 98%
principal protection at maturity (2% of your initial principal
amount is
at risk).
|
· |
Cash
payment
at maturity of $980 plus the Additional Amount, as described
below.
|
· |
Senior
unsecured obligations of JPMorgan Chase & Co. maturing April 14,
2009††.
|
· |
Minimum
denominations of $50,000 and integral multiples of $1,000 in
excess
thereof.
|
· |
The
notes are
expected to price on or about April 9, 2008†††
and are
expected to settle on or about April 14,
2008.
|
Basket:
|
An
equally
weighted basket of four currencies (each a “Basket Currency,” and
together, the “Basket Currencies”) that measures the performance of the
Basket Currencies relative to the U.S. dollar (the “Basket”).
|
Basket
Currency Weights:
|
The
following
table sets forth the Basket Currencies, the Starting Spot Rate†
for each
Basket Currency, the applicable Reuters Page and the weighting
of each
Basket Currency:
|
Basket
Currency
|
Starting
Spot Rate*
|
Reuters
Page
|
Percentage
Weight of Basket
|
|
|
Indonesian
Rupiah (IDR)
|
|
ABSIRFIX01
|
25%
|
|
Malaysian
Ringgit (MYR)
|
|
ABSIRFIX01
|
25%
|
|
Philippine
Peso (PHP)
|
|
PDSPESO**
|
25%
|
|
Singapore
Dollar (SGD)
|
|
ABSIRFIX01
|
25%
|
*
The Starting
Spot Rate for each Basket
Currency
will be
equal to one divided by the amount of such Basket Currency per
U.S. Dollar
and will be determined by the calculation agent in good faith and
in a
commercially reasonable manner at approximately 11:00 a.m., New
York City
time, on the pricing date taking into account the quotient of one
divided
by either applicable intra-day trades or the rates displayed on
the
applicable Reuters page. For information about the risks related
to this
discretion, see “Selected Risk Considerations —
Potential
Conflicts” on page TS-3 of this amended and restated term
sheet.
**
To the right
of the caption “AM WT AVE”
|
Reference
Currency:
|
The
U.S.
dollar
|
Payment
at
Maturity:
|
At
maturity,
you will receive a cash payment, for each $1,000 principal amount
note, of
$980 plus the Additional Amount, which may be zero.
|
Partial
Principal Protection Percentage:
|
98%
principal
protection (2% of your initial principal amount is at
risk).
|
Additional
Amount:
|
The
“Additional Amount” per $1,000 principal amount note paid at maturity will
equal:
(1)
if the
Ending Basket Level is greater than the Upper Knock-In Level:
($1,000
x
Knock-In Rate) + [$1,000 x (Basket Return - Knock-In Rate) x Participation
Rate];
(2)
if the
Ending Basket Level is greater than or equal to the Lower Knock-In
Level
and less than or equal to the Upper Knock-In Level, ($1,000 x the
Knock-In
Rate); or
(3)
if the
Ending Basket Level is less than the Lower Knock-In Level,
zero.
Even
if
the Basket Return is positive, you will lose 2% of your initial
investment
at maturity if the Ending Basket Level is less than the Lower Knock-In
Level.
|
Participation
Rate:
|
At
least
100%. The actual Participation Rate will be determined on the pricing
date
and will not be less than 100%.
|
Knock-In
Rate:
|
At
least 10%.
The actual Knock-In Rate will be determined on the pricing date
and will
not be less than 10%.
|
Lower
Knock-In Level:
|
103
|
Upper
Knock-In Level:
|
At
least 110.
The actual Upper Knock-In Level will be determined on the pricing
date and
will not be less than 110.
|
Basket
Return:
|
Ending
Basket Level - Starting Basket Level
Starting
Basket Level
|
Starting
Basket Level:
|
Set
equal to
100 on the pricing date.
|
Ending
Basket
Level:
|
The
arithmetic average of the Basket Closing Levels on each of the
Ending
Averaging Dates.
|
Basket
Closing Level:
|
The
Basket
Closing Level on any currency business day will be calculated as
follows:
100
x [1 + (IDR Return * 1/4) + (MYR Return * 1/4) + (PHP Return *
1/4) +
(SGDReturn * 1/4)]
Each
of the
IDR Return, MYR Return, PHP Return and SGD Return reflects the
performance
of the respective Basket Currency, expressed as a percentage, from
the
Starting Spot Rate of the respective Basket Currency to the Spot
Rate of
such Basket Currency on such currency business day. The Spot Rate
of each
Basket Currency on a given date is equal to one divided by the
applicable
amount reported by Reuters Group PLC on page ABSIRFIX01 (for the
IDR
Return, the MYR Return and the SGD Return) or page PDSPESO (for
the PHP
Return), as applicable, at approximately 11:00 a.m., New York City
time,
on such date (each a “Spot Rate”), and is expressed as one divided by the
amount of Basket Currency per one Reference Currency.
For
additional information, see “Description of Notes — Payment at Maturity”
in the accompanying product supplement no. 49-III.
|
Ending
Averaging Dates††:
|
April
3,
2009, April 6, 2009, April 7, 2009, April 8, 2009 and April 9,
2009
|
Maturity
Date††:
|
April
14,
2009
|
CUSIP:
|
48123MR46
|
† |
This
amended and restated term sheet amends and restates and supersedes
the
term sheet related hereto dated April 4, 2008 to product supplement
no.
49-III ( the term sheet is available on the SEC website at http://www.sec.gov/Archives/edgar/data/19617/000114420408020782/v109806_fwp.pdf
in its entirety.
|
†† |
Subject
to
postponement as described under “Description of Notes — Payment at
Maturity” in the accompanying product supplement no.
49-III.
|
††† |
The
pricing
of the notes is subject to our special tax counsel delivering to
us their
opinion as described under “Selected Purchase Considerations — Taxed as
Short-Term Debt Instruments.
|
Price
to Public
|
Fees
and Commissions (1)
|
Proceeds
to Us
|
|
Per
note
|
$
|
$
|
$
|
Total
|
$
|
$
|
$
|
(1) |
Please
see
“Supplemental Underwriting Information” in this amended and restated term
sheet for information about fees and
commissions.
|
· |
Product
supplement no. 49-III dated December 17, 2007:
|
· |
Prospectus
supplement dated October 12, 2006:
|
· |
Prospectus
dated December 1, 2005:
|
· |
CURRENCY
BUSINESS DAY—
A
“currency
business day,” with respect to each Basket Currency, means (1) any day
other than a day on which banking institutions in The City
of New York are
authorized or required by law, regulation or executive
order to close and
(2) (i) with respect to the Indonesian Rupiah, a day on
which dealings in
foreign currency in accordance with the practice of the
foreign exchange
market occur in Jakarta, Indonesia and Singapore, (ii)
with respect to the
Malaysian Ringgit, a day on which dealings in foreign currency
in
accordance with the practice of the foreign exchange market
occur in Kuala
Lumpur, Malaysia and Singapore, (iii) with respect to the
Philippine Peso,
a day on which dealings in foreign currency in accordance
with the
practice of the foreign exchange market occur in Manila,
Philippines and
(iv) with respect to the Singapore Dollar, a day on which
dealings in
foreign currency in accordance with the practice of the
foreign exchange
market occur in Singapore.
|
Ending
Basket Level
|
Basket
Return
|
Knock-In
Rate
|
(Basket
Return - Knock-In Rate) x Participation Rate
(100%)
|
Additional
Amount
|
|
98%
of
Principal
|
|
Payment
at
Maturity
|
180.00
|
80.00%
|
10.00%
|
70.00%
|
$800.00
|
+
|
$980.00
|
=
|
$1,780.00
|
170.00
|
70.00%
|
10.00%
|
60.00%
|
$700.00
|
+
|
$980.00
|
=
|
$1,680.00
|
160.00
|
60.00%
|
10.00%
|
50.00%
|
$600.00
|
+
|
$980.00
|
=
|
$1,580.00
|
150.00
|
50.00%
|
10.00%
|
40.00%
|
$500.00
|
+
|
$980.00
|
=
|
$1,480.00
|
140.00
|
40.00%
|
10.00%
|
30.00%
|
$400.00
|
+
|
$980.00
|
=
|
$1,380.00
|
130.00
|
30.00%
|
10.00%
|
20.00%
|
$300.00
|
+
|
$980.00
|
=
|
$1,280.00
|
120.00
|
20.00%
|
10.00%
|
10.00%
|
$200.00
|
+
|
$980.00
|
=
|
$1,180.00
|
115.00
|
15.00%
|
10.00%
|
5.00%
|
$150.00
|
+
|
$980.00
|
=
|
$1,130.00
|
110.00
|
10.00%
|
10.00%
|
N/A
|
$100.00
|
+
|
$980.00
|
=
|
$1,080.00
|
105.00
|
5.00%
|
10.00%
|
N/A
|
$100.00
|
+
|
$980.00
|
=
|
$1,080.00
|
103.00
|
3.00%
|
10.00%
|
N/A
|
$100.00
|
+
|
$980.00
|
=
|
$1,080.00
|
102.00
|
2.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
100.00
|
0.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
90.00
|
-10.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
80.00
|
-20.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
70.00
|
-30.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
60.00
|
-40.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
50.00
|
-50.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
40.00
|
-60.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
30.00
|
-70.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
20.00
|
-80.00%
|
N/A
|
N/A
|
$0.00
|
+
|
$980.00
|
=
|
$980.00
|
· |
PRESERVATION
OF 98% OF YOUR PRINCIPAL AT MATURITY —
You
will
receive at least 98% of the principal amount of your notes if
you hold the
notes to maturity, regardless of the performance of the Basket.
Because
the notes are our senior unsecured obligations, payment of any
amount at
maturity is subject to our ability to pay our obligations as
they become
due.
|
· |
APPRECIATION
POTENTIAL —
If
the
Ending Basket Level is greater than or equal to the Lower Knock-In
Level
of 103, at maturity, for each $1,000 principal amount note, in
addition to
$980, you will receive a payment equal to $100 ($1,000 x Knock-In
Rate of
10%*), for a total payment at maturity of $1,080. If the Ending
Basket
Level is greater than the Upper Knock-In Level of 110*, at maturity,
for
each $1,000 principal amount note, in addition to the $1,080
payment
described above, you will receive a further payment equal to
[$1,000 x
(Basket Return - 10%*) x Participation Rate**].
|
· |
DIVERSIFICATION
AMONG THE BASKET CURRENCIES —
The
return
on the notes is linked to the performance of a basket of currencies,
which
we refer to as the Basket Currencies, relative to the U.S. dollar,
and
will enable you to participate in a potential increase in the
value of the
Basket during the period from the pricing date through and including
the
final Ending Averaging Date. The Basket derives its value from
an equally
weighted group of currencies consisting of the Indonesian Rupiah,
the
Malaysian Ringgit, the Philippine Peso and the Singapore
Dollar.
|
· |
TAXED
AS SHORT-TERM DEBT INSTRUMENTS — You
should
review carefully the section entitled “Certain U.S. Federal Income Tax
Consequences” in the accompanying product supplement no. 49-III. The
pricing of the notes is subject to delivery of an opinion of
our special
tax counsel, Davis Polk & Wardwell, that, although not entirely free
from doubt, the notes will be treated as “short-term” debt instruments.
The opinion will be subject to the limitations described in the
section
entitled “Certain U.S. Federal Income Tax Consequences” in product
supplement 49-III and will be based on certain factual representations
to
be received from us on or prior to the pricing date. No statutory,
judicial or administrative authority directly addresses the treatment
of
the notes or instruments similar to the notes for U.S. federal
income tax
purposes, and no ruling is being requested from the Internal
Revenue
Service with respect to the notes. As a result, certain aspects
of the tax
treatment of an investment in the notes are uncertain. Purchasers
who are
not initial purchasers of notes at the issue price should consult
their
tax advisers with respect to the tax consequences of an investment
in the
notes.
|
· |
YOUR
INVESTMENT MAY RESULT IN A 2% LOSS AT MATURITY —
The
return on the notes at maturity is linked to the performance
of the
Basket, and will depend on whether the Ending Basket Level is
less than,
or greater than or equal to the Lower Knock-In Level, and in
the latter
case, whether, and the extent to which, the Ending Basket Level
is also
greater than the Upper Knock-In Level. The Ending Basket Level
must be at
least 103% of the Starting Basket Level for you to receive more
than 98%
of the principal amount of your notes at maturity. Accordingly,
you could lose up to $20 for each $1,000 principal amount note
that you
invest in.
|
· |
EVEN
IF THE BASKET RETURN IS POSITIVE, THE NOTES MIGHT NOT PAY MORE
THAN 98% OF
THE PRINCIPAL AMOUNT AT MATURITY —
If
The
Ending Basket Level is less than the Lower Knock-In Level of
103, you will
receive only 98% of the principal amount of your notes at maturity,
even
if the Basket Return is positive but less than 3%. If
the Ending
Basket Level does not exceed the Lower Knock-In Level of 103,
the
Additional Amount will be zero. This will be true even if the
value of the
Basket was higher than the Lower Knock-In Level at some time
during the
term of the notes but later falls below the Lower Knock-In Level
on
any of the Ending Averaging Dates.
Because the
Ending Basket Level will be calculated based on the arithmetic
average of
the Basket Closing Levels on each of the Ending Averaging Dates,
the level
of the Basket at the maturity date or at other times during the
term of
the notes could be higher than the Ending Basket Level. This
difference
could be particularly large if there is a significant decrease
in the
level of the Basket during the latter portion of the term of
the notes or
if there is significant volatility in the Basket level during
the term of
the notes, especially on dates near any of the
Ending Averaging Dates.
You
will receive no more than $980 for each $1,000 principal amount
note at
maturity if the Basket Return is less than
3%.
|
· |
CURRENCY
MARKET RISK —
Any
positive Basket Return of more than 3% will depend on the aggregate
performance of the Basket Currencies relative to the U.S. dollar.
For
example, the value of any currency, including the Basket Currencies,
may
be affected by complex political and economic factors. The value
of each
Basket Currency, relative to the U.S. dollar, is, at any moment,
the
result of the interaction between many factors directly or indirectly
affecting economic or political developments in the originating
country
(or countries) of each Basket Currency and the United States,
including
economic and political developments in other
countries.
|
· |
THE
NOTES MIGHT NOT PAY AS MUCH AS AN INVESTMENT IN THE INDIVIDUAL
BASKET
CURRENCIES —
You
may
receive a lower payment at maturity than you would have received
if you
had invested in the Basket Currencies individually, a combination
of
Basket Currencies or contracts related to the Basket Currencies
for which
there is an active secondary
market.
|
· |
CHANGES
IN THE VALUE OF THE EQUALLY WEIGHTED BASKET CURRENCIES MAY OFFSET
EACH
OTHER —
Because
the
performance of the Basket is determined by the performance of
the
Indonesian Rupiah, the Malaysian Ringgit, the Philippine Peso
and the
Singapore Dollar relative to the U.S. dollar, your notes will
be exposed
to currency exchange rate risk with respect to Indonesia, Malaysia,
the
Philippines and Singapore. Movements in the exchange rates of
the Basket
Currencies may not correlate with each other. As a result, your
investment
in the notes may only yield a positive return if there occurs
a
broad-based rise in foreign currency values as compared to the
U.S. dollar
across diverse markets over the term of the notes. Therefore,
for example,
in calculating the Ending Basket Level, an increase in the Spot
Rate of
the Singapore Dollar may be moderated, or more than offset by,
lesser
increases or declines in the Spot Rate of the Philippine Peso.
|
· |
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 amended and restated 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, the price, if any, at which J.P. Morgan Securities Inc.,
which we
refer to as 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. The notes are not designed to be short-term
trading instruments. Accordingly, you should be able and willing
to hold
your notes to maturity.
|
· |
NO
INTEREST PAYMENTS —
As
a holder
of the notes, you will not receive interest
payments.
|
· |
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 and hedging our
obligations
under the notes. 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. For example, one
of JPMSI’s
duties as calculation agent involves determining the Starting
Spot Rate in
the manner set forth on the cover page of this amended and restated
term
sheet. The Starting Spot Rate may vary, and may vary significantly,
from
the rates displayed in publicly available sources at 11:00 a.m.,
New York
City time, on the pricing date. If the calculation agent determines
that
the Starting Spot Rate for one or more Basket Currencies exceeds
that
reflected in the publicly available information, each affected
Basket
Currency must achieve a higher level for you to receive more
than the
principal amount of your notes at maturity. JPMSI will not have
any
obligation to consider your interests as a holder of the notes
in making
this determination.
|
· |
MANY
ECONOMIC AND MARKET FACTORS WILL IMPACT THE VALUE OF THE NOTES
—
In
addition
to the level of the Basket on any 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, including:
|
·
|
the
expected
volatility in the Basket Currencies and the U.S.
dollar;
|
·
|
the
time to
maturity of the notes;
|
·
|
interest
and
yield rates in the market generally as well as in each of the
Basket
Currencies’ countries and in the United
States;
|
·
|
the
exchange
rate and the volatility of the exchange rate among each of the
Basket
Currencies;
|
·
|
changes
in
correlation between the Basket Currency exchange
rates;
|
·
|
suspension
or
disruption of market trading in any or all of the Basket Currencies
or the
U.S. dollar;
|
·
|
a
variety of
economic, financial, political, regulatory or judicial events;
and
|
·
|
our
creditworthiness, including actual or anticipated downgrades
in our credit
ratings.
|