May 3, 2002

Public Credit and Repackaged Securities(SM) (PCARS)(SM) Trust JPM Capital
Trust I Series 2002-2
c/o Wells Fargo Bank Minnesota, N.A., as trustee
213 Court Street, Suite 902
Middletown, CT 06457

Ladies and Gentlemen:

For  value  received,  The  Goldman  Sachs  Group,  Inc.  (the  "Guarantor"),  a
corporation  organized  under  the  laws  of  the  State  of  Delaware,   hereby
unconditionally  guarantees the prompt and complete payment when due, whether by
acceleration or otherwise,  of all obligations and  liabilities,  whether now in
existence  or  hereafter  arising of Goldman  Sachs  Capital  Markets,  L.P.,  a
subsidiary of the Guarantor and a limited  partnership  organized under the laws
of  the  State  of  Delaware   ("GSCM"),   to  PUBLIC   CREDIT  AND   REPACKAGED
SECURITIES(SM)  (PCARS)(SM)  TRUST  JPM  CAPITAL  TRUST  I  SERIES  2002-2  (the
"Counterparty")  arising out of or under the ISDA Master  Agreement  dated as of
May 3,  2002,  between  GSCM  and the  Counterparty  (the  "Obligations").  This
Guaranty is one of payment and not of collection.

The Guarantor  hereby waives notice of acceptance of this Guaranty and notice of
the Obligations, and waives presentment,  demand for payment, protest, notice of
dishonor or non-payment of the Obligations,  suit, or the taking of other action
by the Counterparty against GSCM, the Guarantor or others.

The  Counterparty  may at any time and from  time to time  without  notice to or
consent of the Guarantor and without  impairing or releasing the  obligations of
the Guarantor hereunder:  (1) agree with GSCM to make any change in the terms of
the  Obligations;  (2) take or fail to take any action of any kind in respect of
any security for the  Obligations;  (3) exercise or refrain from  exercising any
rights against GSCM or others in respect of the  Obligations;  or (4) compromise
or  subordinate  the  Obligations,  including any security  therefor.  Any other
suretyship defenses are hereby waived by the Guarantor.

The Guarantor  further  agrees that this Guaranty shall continue to be effective
or be  reinstated,  as the case  may be,  if at any  time  payment,  or any part
thereof, of any Obligations,  or interest thereon is rescinded or must otherwise
be restored or returned by the  Counterparty  upon the  bankruptcy,  insolvency,
dissolution or reorganization of GSCM.



<PAGE>

Public Credit and Repackaged Securities(SM) (PCARS)(SM) Trust JPM Capital
Trust I Series 2002-2
c/o Wells Fargo Bank Minnesota, N.A., as trustee
May 3, 2002
Page 2


This  Guaranty  shall  continue  in full force and effect  until the  opening of
business  on the fifth  business  day after the  Counterparty  receives  written
notice of termination from the Guarantor.  It is understood and agreed, however,
that  notwithstanding  any such termination this Guaranty shall continue in full
force and effect with respect to all Obligations  which shall have been incurred
prior to such termination.

The Guarantor may not assign its rights nor delegate its obligations  under this
Guaranty,  in  whole  or in part,  without  the  prior  written  consent  of the
Counterparty,  and any purported assignment or delegation absent such consent is
void,  except for an assignment and delegation of all of the Guarantor's  rights
and  obligations  hereunder in whatever  form the  Guarantor  determines  may be
appropriate  to a  partnership,  corporation,  trust  or other  organization  in
whatever  form that  succeeds  to all or  substantially  all of the  Guarantor's
assets and business and that assumes such obligations by contract,  operation of
law or otherwise.  Upon any such delegation and assumption of  obligations,  the
Guarantor  shall be  relieved  of and  fully  discharged  from  all  obligations
hereunder,  whether such  obligations  arose before or after such delegation and
assumption.

THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK WITHOUT  GIVING  EFFECT TO PRINCIPLES OF CONFLICTS
OF LAW. GUARANTOR AGREES TO THE EXCLUSIVE  JURISDICTION OF COURTS LOCATED IN THE
STATE OF NEW YORK, UNITED STATES OF AMERICA,  OVER ANY DISPUTES ARISING UNDER OR
RELATING TO THIS GUARANTY.

Very truly yours,

THE GOLDMAN SACHS GROUP, INC.



By:     /s/ Elizabeth Beshel
   --------------------------------
         Authorized Officer