AMENDMENT No. 3 TO SUB-ADMINISTRATION AGREEMENT

Exhibit k(5)

EXECUTION COPY

AMENDMENT No. 3 TO
SUB-ADMINISTRATION AGREEMENT

     AMENDMENT No. 3, made as of this 1^st day of January, 2005, to the Sub-Administration Agreement dated as of May 23, 2000 among Hyperion Capital Management, Inc. (the “Company”), a Delaware corporation on behalf of the Hyperion 2005 Investment Grade Opportunity Term Trust, Inc., The Hyperion Total Return Fund, Inc., Hyperion Strategic Bond Fund, Inc., Lend Lease Hyperion Mortgage Opportunity Fund, Inc., Hyperion Strategic Mortgage Income Fund, Inc. and Hyperion Collateralized Securities Fund, Inc. (the “Funds”) and State Street Bank and Trust Company, a Massachusetts trust company (the “Bank”).

     WHEREAS, the Company, the Funds and the Bank have entered into a Sub-Administration Agreement for the provision by the Bank of certain administrative services to the Funds and the Trust and;

     WHEREAS, the Company wishes to add Quadrant Fund, Inc. (the “New Fund”) as a party to the Sub-Administration Agreement, and each of the New Fund, the Company, the Funds and the Bank wish to amend the Sub-Administration Agreement to (i) add the New Fund as a party thereto; and (ii) amend the Fee Schedule to include the New Fund;

     NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained, the parties hereto agree as follows:

	1.		The New Fund shall be added to the Sub-Administration Agreement as an additional party. The New Fund shall become subject to the provisions of the Sub-Administration Agreement to the same extent as the existing Funds, except to the extent that such provisions (including those relating to the compensation and expenses payable by the Funds) are hereby modified with respect to the New Fund in writing by the New Fund and the Bank.
	2.		The New Fund hereby makes all of the representations and warranties to the Bank contained in Section 4 of the Sub-Administration Agreement.
	3.		The Fee Schedule annexed hereto shall replace any prior fee schedule.
	4.		Schedule A annexed hereto shall replace any prior Schedule A.

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their officers designated below as of the date first written above.

	HYPERION CAPITAL MANAGEMENT, INC.
	By:		/s/ Xxxxxx X. Xxxxxxx
	Name:		Xxxxxx X. Xxxxxxx
	Title:		Chief Operating Officer

HYPERION 2005 INVESTMENT GRADE OPPORTUNITY TERM TRUST, INC.
THE HYPERION TOTAL RETURN FUND, INC.
HYPERION STRATEGIC BOND FUND, INC.
LEND LEASE HYPERION MORTGAGE OPPORTUNITY FUND, INC.
HYPERION STRATEGIC MORTGAGE INCOME FUND, INC.
HYPERION COLLATERIZED SECURITIES FUND, INC.

	By:		/s/ Xxxxxx X. Xxxxxxx
	Name:		Xxxxxx X. Xxxxxxx
	Title:		Treasurer
	QUADRANT FUND, INC.
	By:		/s/ Xxxxxx X. Xxxxxxx
	Name:		Xxxxxx X. Xxxxxxx
	Title:		Treasurer
	STATE STREET BANK AND TRUST COMPANY
	By:		/s/ Xxxx X. Xxxxxx
	Name:		Xxxx X. Xxxxxx
	Title:		Senior Vice President

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SUB-ADMINISTRATION AGREEMENT
HYPERION FUNDS

SCHEDULE A
Listing of Investment Funds and Authorized Shares

Investment Fund Authorized Shares

Hyperion 2005 Investment Grade Opportunity Term Trust, Inc.
The Hyperion Total Return Fund, Inc.
Hyperion Strategic Bond Fund, Inc.
Lend Lease Hyperion Mortgage Opportunity Fund, Inc.
Hyperion Strategic Mortgage Income Fund, Inc.
Hyperion Collateralized Securities Fund, Inc.
Quadrant Fund, Inc.

Amended as of January 1, 2005

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STATE STREET BANK AND TRUST COMPANY

FUND ADMINISTRATION COMPLEX FEE SCHEDULE
FOR HYPERION FUNDS

I.  Fees for Fund Administration Services:

The following fee schedule is for sub-administration services for the following Hyperion Funds: Hyperion 2005 Investment Grade Opportunity Term Trust Inc., The Hyperion Total Return Fund Inc., Hyperion Strategic Bond Fund, Inc., Lend Lease Hyperion Mortgage Opportunity Fund, Inc., Hyperion Strategic Mortgage Income Fund, Inc., Hyperion Collateralized Securities Fund, Inc. and Quadrant Fund, Inc. For these funds, the services include: Daily accounting oversight; IRS, SEC & Prospectus Compliance; financial reporting; expense budgeting & xxxx processing; SEC performance, board reporting and limited legal services¹. For these services, the Funds will be charged according to the following fee schedule:

		Annual Fee
Average Assets Break Point		Expressed in Basis Points: 1/100 of 1%
First $100 Million		9.00
Next $100 Million		7.00
Thereafter		5.00
Minimum Per Fund		$100,000

Fund Fees:

The total net assets of all Funds will be used to calculate the fee by multiplying the net assets of all Funds by the basis point fees in the above schedule. The minimum fee will be calculated by multiplying the minimum fee by the number of Funds to arrive at the total minimum fee. The greater of the basis point fee or the minimum fee will be accrued to each fund based on the pro-rata total net asset value of each Fund.

II.  Services Not Performed

This proposal specifically does not include the following services: proxy tabulation, assembling and distributing board books, telephone support for shareholders’ inquiries, tax preparation and filing, blue sky services and other services as outlined in the Sub-Administration Agreement and Fund Profile.

III.  Multiple Classes of Shares

An additional $10,000 annual fee will be applied for each class of shares, excluding the first class of shares, if more than one class of shares is operational in a Fund.

¹ Legal services are limited to the preparation, far review and approval by Hyperion and it’s outside legal counsel, of the following: initial fund registration statements on Form N-2, annual proxy statements and Forms X-0X.

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XXXXX XXXXXX BANK AND TRUST COMPANY

FUND ADMINISTRATION COMPLEX FEE SCHEDULE
FOR HYPERION FUNDS

IV.  Out of Pocket Expenses - Include, But May Not Be Limited To:

	•		Legal fees, audit fees and other professional fees
	•		Postage
	•		Supplies related to Fund records
	•		Travel and lodging for Board and Operations meetings
	•		Preparation of financial statements other than Annual and Semi-Annual Reporting, $3,000 per financial report.

V.  Special Arrangements

Fees for activities of a non-recurring nature such as reorganizations, and/or preparation of special reports will be subject to negotiation. Fees for a change in fund structure (i.e., Core and Feeder) are subject to negotiation.

VI. Term of the Contract

The parties agree that this fee schedule shall remain in effect until December 31, 2004 and from year to year thereafter until it is revised as a result of negotiations initiated by either party.

HYPERION CAPITAL MANAGEMENT, INC.		HYPERION 2005 INVESTMENT GRADE OPPORTUNITY
		TERM TRUST, INC.
		THE HYPERION TOTAL RETURN FUND, INC.
		HYPERION STRATEGIC BOND FUND, INC.
		LEND LEASE HYPERION MORTGAGE OPPORTUNITY
		FUND, INC.
		HYPERION STRATEGIC MORTGAGE INCOME FUND, INC.
		HYPERION COLLATERALIZED SECURITIES FUND, INC.
		QUADRANT FUND, INC.

By:		/s/ Xxxxxx X. Xxxxxxx				By:		/s/ Xxxxxx X. Xxxxxxx
Name:		Xxxxxx X. Xxxxxxx				Name:		Xxxxxx X. Xxxxxxx
Title:		Chief Operating Officer				Title:		Treasurer
Date:		January 1, 2005				Date:		January 1, 0000
XXXXX XXXXXX BANK AND TRUST COMPANY
By:		/s/ Xxxx X. Xxxxxx
Name:		Xxxx X. Xxxxxx
Title:		Senior Vice President
Date:		January 1, 2005

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