NVCA's co-sale agreement lets a company buy first, investors follow

The record

The National Venture Capital Association publishes a model Right of First Refusal and Co-Sale Agreement, updated April 2026 per the document's own filename and listed on NVCA's model-legal-documents page as retrieved on 16 September 2026. The agreement runs among the company, its investors, and its 'Key Holders,' defined as the founders and other stockholders named on a schedule to the agreement. Its defined terms set out a sequence: a 'Right of First Refusal' is 'the right, but not an obligation, of the Company... to purchase some or all of the Transfer Stock with respect to a Proposed Key Holder Transfer,' and a 'Right of Co-Sale' is 'the right, but not an obligation, of an Investor to participate in a Proposed Key Holder Transfer' once stock the company did not buy is headed to an outside buyer.

What the documents establish

The agreement's operative sections establish the order of operations precisely: if a Key Holder proposes to transfer stock, the company gets first refusal; only stock 'not purchased' by the company and 'thereafter... to be sold to a Prospective Transferee' becomes subject to co-sale, at which point each investor 'may elect to exercise its Right of Co-Sale and participate on a pro rata basis.' A participating investor 'must give the selling Key Holder written notice... within 15 days.' The document also lists 'Exempt Transfers,' including a transfer by an entity Key Holder to its own equity holders, that fall outside both rights entirely. The model-legal-documents page adds only that this agreement is one document within NVCA's linked set, not that every financing uses it in unmodified form.

The operating read

Editorially, the sequence the document sets out matters more than either right alone: co-sale is a fallback that only activates after the company has already passed on its own purchase option, not a parallel right investors can exercise first. A founder planning any secondary sale of personal shares should expect the process to run through the company's refusal window and the 15-day co-sale notice period before a buyer can actually close, and should check the schedule of exempt transfers before assuming a family or estate-planning transfer needs to go through either process at all.

What to check before you decide

Before relying on this model's mechanics for an actual sale, check the following against the signed agreement.

• Has the company's board or the required investor threshold actually declined to exercise the Right of First Refusal on the specific shares being sold?
• Does the proposed transfer fall within one of the agreement's own Exempt Transfer categories, removing it from both rights?
• Have all Participating Investors' 15-day notice windows run, or been waived, before treating the sale as clear to close?

This is a description of NVCA's own model as retrieved on 16 September 2026, not of any specific company's negotiated agreement, which counsel drafts to fit that company's cap table and financing history.