Supplemental
amended and restated 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
amended and restated term sheet to
Product
Supplement No. 34-VI
Registration
Statement No. 333-130051
Dated
March 11, 2008; Rule 433
|
Structured
Investments |
JPMorgan
Chase & Co.
$
Reverse
Exchangeable Notes due June 30, 2008
Linked
to the Common Stock of a Single Reference Stock
Issuer
|
· |
This
supplemental amended and restated 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.
|
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:
|
June
30,
2008*
|
Pricing
Date:
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On
or about
March 26, 2008
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Settlement
Date:
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On
or about
March 31, 2008
|
Observation
Date:
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June
25,
2008*
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Interest
Payment Dates:
|
Interest
on
the notes will be payable monthly in arrears on the last calendar
day of
each month (each such date, an “Interest Payment Date”), commencing April
30, 2008, to and including the Interest Payment Date corresponding
to the
Maturity Date. See “Selected Purchase Considerations — Monthly Interest
Payments” in this supplemental amended and restated term sheet for more
information.
|
Monitoring
Period:
|
The
period
from the Pricing Date to and including the Observation Date.
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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.
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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.
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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.
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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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||||||||||
Page
Number
|
Ticker
Symbol
|
Principal
Amount
|
Interest
Rate
|
Protection
Amount
|
Initial
Share Price
|
CUSIP
|
Approximate
Monthly Coupon
|
Interest
on Deposit
|
Put
Premium
|
|
Freeport-McMoRan
Copper & Gold Inc.
|
TS-3
|
FCX
|
4.50%
(equivalent
to
18.00% per annum)
|
25.00%
of the
Initial Share Price
|
48123MYJ5
|
$15.00
|
15.94%
|
84.06%
|
* |
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 amended and restated term sheet supplements the amended
and
restated term sheet related hereto dated March 10, 2008 to product
supplement no. 34-VI but does not supersede the amended and restated
term
sheet. The amended and restated term sheet, in turn, amends and restates
and supersedes the term sheet related hereto dated March 7, 2008
to
product supplement no. 34-VI (the term sheet dated March 7, 2008
is
available on the SEC website at http://www.sec.gov/Archives/edgar/data/19617/000114420408014160/v106335_fwp.pdf)
in its
entirety.
|
†† |
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 March 7, 2008; the actual allocations will be determined
as of the Pricing Date and may
differ.
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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 amended and restated term
sheet.
|
· |
Product
supplement no. 34-VI dated February
28,
2008: http://www.sec.gov/Archives/edgar/data/19617/000089109208001279/e30509_424b2.pdf
|
· |
Prospectus
supplement dated October 12, 2006: http://www.sec.gov/Archives/edgar/data/19617/000089109206003117/e25276_424b2.pdf
|
· |
Prospectus
dated December 1, 2005:
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· |
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 amended and restated 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.
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· |
MONTHLY
INTEREST PAYMENTS —
The
notes offer monthly interest payments at the Interest Rate set forth
on
the cover of this supplemental amended and restated term sheet. Interest
will be payable monthly in arrears on the last
calendar day of each month (each such date, an “Interest Payment Date”),
commencing April 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 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.
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· |
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 March 7, 2008, of each
coupon
payment, we would have treated the percentages specified on the cover
of
this supplemental amended and restated 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.
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JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference
Stock
Issuer
|
· |
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.
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· |
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.
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· |
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.
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· |
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 amended and restated
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.
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· |
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 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, 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.
|
· |
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
|
JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference
Stock
Issuer
|
·
|
the
Initial
Share Price:
|
$100.00
|
·
the
Protection Amount: $25.00
|
||
·
|
the
Interest
Rate:
|
4.50%
(equivalent to 18.00% per annum)
|
Hypothetical
lowest closing price during the Monitoring Period
|
Hypothetical
Final Share Price
|
Payment
at Maturity
|
Total
Value of Payment Received at Maturity**
|
$100.00
|
$200.00
|
$1,000.00
|
$1,000.00
|
$50.00
|
$105.00
|
$1,000.00
|
$1,000.00
|
$100.00
|
$100.00
|
$1,000.00
|
$1,000.00
|
$75.00
|
$75.00
|
$1,000.00
|
$1,000.00
|
$50.00
|
$95.00
|
10
shares of
the Reference Stock or the Cash Value thereof
|
$950.00
|
$50.00
|
$50.00
|
10
shares of
the Reference Stock or the Cash Value thereof
|
$500.00
|
$25.00
|
$25.00
|
10
shares of
the Reference Stock or the Cash Value thereof
|
$250.00
|
$0.00
|
$0.00
|
10
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.
|
JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference
Stock
Issuer
|
JPMorgan
Structured Investments —
Reverse
Exchangeable Notes Linked to the Common Stock of a Single Reference
Stock
Issuer
|