EXPENSE LIMITATION AND REIMBURSEMENT AGREEMENT
Exhibit
(k)(3)
AGREEMENT
made as of the [__] day of [____], 2010 by and among Partners Group Private
Equity (Institutional TEI), LLC, a Delaware limited liability company (the
“Fund”) and Partners Group (USA) Inc., a Delaware corporation (“Partners
Group”):
WITNESSETH:
WHEREAS,
the Fund is registered under the Investment Company Act of 1940 (the “1940 Act”)
as a non-diversified, closed-end, management investment company;
WHEREAS,
the Fund has been organized to invest substantially all of its capital into
Partners Group Private Equity (Offshore II), LDC (the “Offshore Fund”), a Cayman
Islands limited duration company, which in turn invests all or substantially all
of its assets in Partners Group Private Equity (Master Fund), LLC (the “Master
Fund”);
WHEREAS,
Partners Group acts as investment adviser to the Master Fund pursuant to an
Investment Management Agreement with the Master Fund dated as of January 1, 2009
(the “Investment Management Agreement”), pursuant to which it is paid an
investment management fee (the “Investment Management Fee”);
NOW,
THEREFORE, in consideration of the Fund’s investment in the Master Fund, the
Master Fund engaging Partners Group pursuant to the Investment Management
Agreement, and other good and valuable consideration, the parties to this
Agreement agree as follows:
1 Capitalized
terms not otherwise defined herein shall have the meanings ascribed to them in
the Fund’s Confidential Private Placement Memorandum as currently in
effect.
2. Partners
Group agrees to waive the Investment Management Fee and other fees payable to it
directly or indirectly by the Master Fund or the Fund, and to pay or absorb
expenses of the Fund (whether borne directly by the Fund or indirectly through
its interest in the Offshore Fund or indirect interest in the Master Fund) (a
“Waiver”) so that the Total Annual Expenses of the Fund (excluding taxes,
interest, brokerage commissions, other transaction-related expenses, any
extraordinary expenses of the Fund, any Incentive Allocation and any Acquired
Fund Fees and Expenses) will not exceed 2.30% of the net assets of the Fund on
an annualized basis (the “Expense Limitation”).
3. This
Agreement will have an initial term ending two (2) years from the date of
commencement of the Fund’s operations, and during such initial term neither
Partners Group nor the Fund may terminate this Agreement unless, at the time of
such termination, the Fund would be in compliance with the Expense Limitation
without giving effect to any Waiver. This Agreement will
automatically renew for consecutive one-year terms thereafter so long as the
Fund is an investor in the Master Fund (directly or through the Offshore Fund)
and Partners Group or an Affiliate thereof acts as investment manager of the
Master Fund or servicing agent of the Fund. Subject to the initial
sentence of this paragraph, any party may terminate this Agreement upon thirty
(30) days’ written notice to the other party.
4. The
Fund agrees to carry forward, for a period not to exceed (3) three years from
the date on which a Waiver is made by Partners Group, all fees and expenses in
excess of the Expense Limitation that have been waived, paid or absorbed by
Partners Group, and to repay Partners Group such amounts, provided the Fund is
able to effect such repayment and remain in compliance with the Expense
Limitation. To the extent that such repayment is due, it shall be
made as promptly as possible, in conjunction with the next succeeding payment of
Investment Management Fee to Partners Group. To the extent that the
full amount of such waived amount or expense paid cannot be repaid as provided
in the previous sentence within such applicable three-year period, such
repayment obligation shall be extinguished.
Exhibit
(k)(3)
5. If
this Agreement is terminated by the Fund, the Fund agrees to repay to Partners
Group any amounts payable pursuant to paragraph 4 that have not been previously
repaid and, subject to the 1940 Act, such repayment will be made to Partners
Group not later than (3) three years from the date on which a Waiver was made by
Partners Group (regardless of the date of termination of this Agreement), so
long as the Fund is able to effect such reimbursement and remain in compliance
with the Expense Limitation as if such Expense Limitation was still in
effect. If this Agreement is terminated by Partners Group, the Fund
agrees to repay to Partners Group any amounts payable pursuant to paragraph 4
that have not been previously repaid and, subject to the 1940 Act, such
repayment will be made to Partners Group not later than thirty (30) days after
the termination of this Agreement, so long as the Fund is able to effect such
reimbursement and remain in compliance with the Expense Limitation as if such
Expense Limitation was still in effect.
6. This
Agreement will be construed in accordance with the laws of the state of Delaware
and the applicable provisions of the 1940 Act. To the extent the
applicable law of the State of Delaware, or any of the provisions in this
Agreement, conflict with the applicable provisions of the 1940 Act, the
applicable provisions of the 1940 Act will control.
7. This
Agreement constitutes the entire agreement between the parties to this Agreement
with respect to the matters described in this Agreement.
[Signature
page follows]
Exhibit
(k)(3)
IN
WITNESS WHEREOF, the parties to this Agreement have executed this Agreement as
of the date first written above.
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By:
Xxxxx Xxxxxx
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Title:
President
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By:
Xxxxxx Xxxxxxxx
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Title:
Chief Compliance Officer
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PARTNERS
GROUP (USA) INC.
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By:
Xxxxx Xxxxxx
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Title:
President
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By:
Xxxxxx Xxxxxxxx
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Title:
Vice President & Secretary
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