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hi and welcome to ltd24ore.com business school today we are going to talk about what is a shareholders agreement its a contract between the shareholders that sets out the rights and responsibilities of the shareholders this agreement only applies to companies with more than one shareholder generally a shareholders agreement can set out how many shares do each shareholder or the rights and responsibilities applicable to different share class whether there are different classes of shares for example the class a shares can give full voting rights and dividends while class b shares can give just right to a dividend but not voting rights furthermore a shareholders agreement can set out whether or not the company is able to issue additional shares in the future and if so whether current or existing shareholders could have their shares diluted or whether they could buy more shares to keep their share percentage a shareholders agreement could also set out how new shareholders may join the com