Among the many issues and decisions faced by founders preparing for a price capital financing cycle, the definition of the form of financing documents to be used is generally not one of them. For more than a decade, most venture capital transactions have been based on or derivative of the National Venture Capital Association (NVCA) standard financing documents. Although each company and investment has its own unique characteristics, and you should always consult your lawyer before trying to raise capital, we offer in this article a high-level introduction to the five primary NVCA financing documents: (1) share purchase contract; (2) modified and revised founding certificate (assuming a Delaware company); (3) Investor Rights Agreement; (4) voting agreement; and (5) Right of first refusal and co-sale agreement. Please note that this is far from a comprehensive list of relevant provisions and provides only a preliminary overview of complex and differentiated agreements. In addition to the primary funding documents reviewed above, the NVCA has also updated its model management letter, the compensation agreement and the partnership agreement, as well as other related documents. For more information on NVCA legal documents and the impact of recent revisions, please contact Matthew Greenberg, James Jumper or Christopher Miller. Withdrawal rights: The standard document of the founding certificate has been amended to allow the delimitation of a high interest rate on the withdrawal price of the shares subject to an unmet withdrawal request by the company. This revision is intended to determine whether investors are bad players to prevent the issuer from reverting to Rule 506 for future offers or future sales in the same offer when the investor concerned is or becomes an economic owner at 20% of the issuer`s voting rights. The provision of a standard set of documents, adopted across the sector, allows parties involved in private capital transactions to focus on the general issues of the agreement rather than checking hundreds of pages of unknown documents. WASHINGTON, D.C.

– Continuing the National Venture Capital Association`s (NVCA) commitment to convene the entrepreneurial ecosystem and provide resources to support the creation of new businesses, NVCA today presented updates to its model legal documents. The first changes to the documents since 2014, the updates are the product of a group of insider and external consultants from venture capital firms.