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                                    EXHIBIT A

           COVER LETTER TO OFFER TO PURCHASE AND LETTER OF TRANSMITTAL

    IF YOU DO NOT WANT TO SELL YOUR LIMITED PARTNERSHIP UNITS AT THIS TIME,
     PLEASE DISREGARD THIS NOTICE. THIS IS SOLELY NOTIFICATION OF THE FUND'S
                                  TENDER OFFER.

December 24, 2008

Dear Hatteras Multi-Strategy TEI Institutional Fund, L.P. Partner:

     We are writing to inform you of important dates relating to a tender offer
by Hatteras Multi-Strategy TEI Institutional Fund, L.P. (the "Fund"). IF YOU ARE
NOT INTERESTED IN HAVING THE FUND REPURCHASE SOME OR ALL OF YOUR LIMITED
PARTNERSHIP UNITS (INCLUDING FRACTIONS THEREOF) ("UNITS") VALUED AS OF MARCH 31,
2009, PLEASE DISREGARD THIS NOTICE AND TAKE NO ACTION.

     The tender offer period will begin on December 24, 2008 and will end at
12:00 midnight, Eastern Standard Time, on JANUARY 26, 2009, AT WHICH POINT THE
TENDER OFFER WILL EXPIRE. The purpose of the tender offer is to provide
liquidity to Partners of the Fund that hold Units. Units may be presented to the
Fund for purchase only by tendering them during one of the Fund's announced
tender offers.

     Should you wish to tender all or some of your Units for purchase by the
Fund during this tender offer period, please complete and return the enclosed
Letter of Transmittal so that it is received by UMB Fund Services, Inc.
("UMBFS") no later than JANUARY 26, 2009. If you do not wish to have all or some
of your Units repurchased, simply disregard this notice. NO ACTION IS REQUIRED
IF YOU DO NOT WISH TO HAVE ANY OF YOUR UNITS REPURCHASED.

     If you would like to tender your Units, you should complete, sign and
either (i) mail (via certified mail, return receipt requested) or otherwise
deliver the Letter of Transmittal to Hatteras Multi-Strategy TEI Institutional
Fund, L.P., c/o UMB Fund Services, Inc. at P.O. Box 1623, Milwaukee, Wisconsin
53201-1623, Attention: Tender Offer Administrator; or (ii) fax it to UMBFS at
(816) 860-3138, Attention: Tender Offer Administrator (if by fax, please deliver
an original, executed copy promptly thereafter), so that it is RECEIVED BEFORE
12:00 MIDNIGHT, EASTERN STANDARD TIME, ON JANUARY 26, 2009.

     If you have any questions, please refer to the enclosed Offer to Purchase
document, which contains additional important information about the tender
offer, or call the Tender Offer Administrator at UMBFS at (800) 504-9070.

Sincerely,


Hatteras Multi-Strategy TEI Institutional Fund, L.P.