EXHIBIT 99.(H).(12)

           iSHARES TRUST SUBLICENSE AGREEMENT FOR LEHMAN BOND INDICES

                  This Sublicense Agreement (the "Agreement") is made as of June
1, 2002 by and between Barclays Global Investors, N.A., a national banking
association organized under the laws of the United States ("BGI"), and iShares
Trust, a business trust established under the laws of the State of Delaware
("iShares").

                                    RECITALS

                  WHEREAS, pursuant to the INDEX LICENSE AGREEMENT dated
September 1, 2001 (the "License Agreement") between Lehman Brothers Inc., a
Delaware corporation, and BGI, BGI obtained a license to use in connection with
the "iShares Funds" (as that term is defined in the License Agreement) certain
bond indexes owned and managed by Lehman (the "Indexes"), along with associated
marks (the "Marks"); and

                  WHEREAS, BGI has the right pursuant to the License Agreement
to sublicense its rights thereunder to any iShares Fund; and

                  WHEREAS, iShares Trust wishes to use the Indexes in connection
with the establishment of a series of exchange traded funds (each, an "ETF"),
each based on a Index in connection with the identification and marketing of the
ETFs and in connection with making disclosures about the ETFs under applicable
laws, rules and regulations; and

                  WHEREAS, BGI wishes to grant a sublicense to iShares Trust for
the use of the Indexes and Marks;


                  NOW THEREFORE, the parties agree as follows:

        1. Grant of Sublicense. Subject to the terms and conditions of this
Agreement, BGI hereby grants to iShares Trust a sublicense to use the Indexes
(and associated data, information and Marks) listed on Exhibit A in the manner
set forth in, and subject to the terms of, the License Agreement.

        2. Performance of Obligations Under the License. iShares Trust will be
responsible for performing all of BGI's executory obligations under the License
Agreement (other than the payment of license fees), as such obligations relate
to use of the Indexes in connection with the formation and operation of iShares
Funds.

        3. Fees.  iShares Trust shall have no obligation to pay any sublicense
fees to BGI or Lehman under this sublicense agreement.

        4. Termination.  This Agreement shall terminate if (a) the License
Agreement terminates, or (b) BGI or a BGI Affiliate ceases to exercise
investment discretion over the iShares Trust in its capacity as manager,
investment adviser, trustee, or other comparable capacity. BGI shall notify
iShares Trust as soon as reasonably practicable of the occurrence of an

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event described in (a) above. Upon termination of this Agreement, iShares
Trust's right to use the Indexes shall terminate immediately.

        5. Indemnification. iShares Trust shall indemnify and hold harmless BGI,
its officers, employees, agents, successors, and assigns against all judgments,
damages, costs or losses of any kind (including reasonable attorneys' and
experts' fees) resulting from any claim, action or proceeding (collectively
"claims") that arises out of or relates to (a) the creation, marketing,
advertising, selling, and operation of the iShares Trust or interests therein,
or (b) any breach by BGI of its covenants, representations, and warranties under
the License Agreement caused by the actions or inactions of iShares Trust, or
(c) errors in the calculation of any Index, or delays in the dissemination of
any Index, or (d) any violation of applicable laws (including, but not limited
to, banking, commodities, and securities laws) arising out of the offer, sale,
operation, or trading of the iShares Trust or interests therein, except to the
extent such claims result from the negligence, gross negligence or willful
misconduct of BGI or its affiliates. The provisions of this section shall
survive termination of this Agreement.

        6. Assignment.  iShares will not make, or purport to make, any
assignment or other transfer of this Agreement. BGI may assign its rights and
obligations under this Agreement effective upon the giving of written notice to
iShares.

        7. Amendment.  No provision of this Agreement may be waived, altered, or
amended except by written agreement of the parties.

        8. Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof.

        9. Construction. Headings used in this Agreement are for convenience
only, and shall not affect the construction or interpretation of any of its
provisions. Each of the provisions of this Agreement is severable, and the
invalidity or inapplicability of one or more provisions, in whole or in part,
shall not affect any other provision. To the extent not preempted by federal
law, this Agreement shall be construed and interpreted under the laws of the
State of California.

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        10. Counterparts.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but such
counterparts together shall constitute only one instrument.

     IN WITNESS WHEREOF the parties have caused this Agreement to be
executed as of the date first above written, with intent to be bound hereby.

BARCLAYS GLOBAL INVESTORS, N.A.          iSHARES TRUST

By: /s/ Michael Latham                   By:  /s/ Susan Mosher
Name:   Michael Latham                   Name:  Susan Mosher
Title:  Managing Director                Title: Secretary


By: /s/ Bruce Lavine
Name:   Bruce Lavine
Title:  Principal

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              Exhibit A to Sublicense Agreement dated July 1, 2002

Lehman Indexes:

Lehman Brothers 1-3 year Treasury Index

Lehman Brothers 7-10 year Treasury Index

Lehman Brothers 20+ year Treasury Index

Lehman Brothers Treasury Index

Lehman Brothers Government/Credit Index

U.S. Credit Index

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