Lack of Diversification Clause Samples
The Lack of Diversification clause defines the parties’ acknowledgment and acceptance of risks associated with holding a concentrated investment portfolio, rather than spreading investments across multiple assets or sectors. In practice, this clause typically applies to investment agreements or fund documents, where an investor or fund manager may choose to focus on a limited number of securities or asset classes. Its core function is to clarify that the investor understands and accepts the increased risk of loss due to limited diversification, thereby allocating risk and reducing potential liability for the party managing the investments.
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Lack of Diversification. The Company’s proposed operations, even if successful, will in all likelihood result in the Company’s engaging in a business which is concentrated in only one industry. Consequently, the Company’s activities will be limited to the anti-counterfeiting industry. The Company’s inability to diversify its activities into a number of areas may subject the Company to economic fluctuations within a particular business or industry and, therefore, increase the risks associated with the Company’s operations.
Lack of Diversification. The development and operation of the Company is limited to a narrowly-focused business serving a single industry segment in a localized geographic area. Due to this lack of diversification, the Company may be subject to greater risk of loss from local, industry-specific or participant-specific risks than would be the case with a more diversified enterprise.
Lack of Diversification. The Company is formed solely for the purpose of developing, producing and exploiting the Picture. Therefore, the financial performance of the Company is solely dependent upon the success of its Picture. In addition, the financial performance of the investment in Company is dependent upon the ability of Company to complete the Picture in a timely and cost-effective manner, the ability of Company to obtain successful theatrical distribution of the Picture and the ultimate audience appeal of the Picture if and when completed.
Lack of Diversification. The Company's proposed business involving the proposed operation of establishments offering "female exotic entertainment" will not provide any diversification. If the Company is successful, all of the Company's business and assets will be concentrated in the same industry.
Lack of Diversification. The Partnership's fundamental purpose will be to operate the Lithotripsy Systems. Because the Partnership is dependent on only one line of business, it will have greater risks from unexpected service interruptions, equipment breakdowns, technological developments, kidney stone treatment medical breakthroughs, economic problems and similar matters than would be the case with a more diversified business.
Lack of Diversification. All of the Company's assets will be committed to the development and operation of the Business. As a result, the Company will lack diversification in its assets and the potential profitability of the Company (and therefore the Shares) will be limited solely to the profitability of the Business, which could be adversely affected by many factors, including, among other things, a downturn it the luxury activewear industry.
Lack of Diversification. The Partnership's principal purpose will be to continue to operate the Mobile Lithotripsy System. Because the Partnership is dependent on only one line of business and one Mobile Lithotripsy System, there will be greater risks from unexpected service interruptions, equipment breakdowns, technological developments, kidney stone treatment medical breakthroughs, economic problems and similar matters than would be the case with a more diversified business.
Lack of Diversification. The Company’s business activities will be to invest in the Property Owner, whose success will depend on the performance of the Property. Since the Company’s portfolio will be limited by the amount of available capital, it will be less diversified than other, diversified property owners with greater capital. The sole source of revenues to pay returns to investors will be revenues from the operation and eventual sale of the Property.
Lack of Diversification. The Company’s business is manufacture of paper. In view of the limited scope of its limited business, it may have greater risks from casualties, competition, economic problems and similar matters than would be the case with a more diversified company.
Lack of Diversification. At the present time, Buyer intends to invest only in dely-style restaurants and related food operations. As a result, changes in consumer preferences, including a change in consumer preferences for restaurants of the type operated by Buyer, may have a disproportionate and materially adverse impact on Buyer's business and its operating results.