Distribution Agreement Template

The Distribution Agreement is a formal contract between a manufacturer or supplier and a distributor and is designed to comply with best commercial practices in respect of either an exclusive or a non-exclusive product distributor agreement․

This template:

• Grants exclusive distribution rights for a defined territory
• Specifies the extent of product and resales
• Sets deadlines for the acceptance and fulfillment
• Also includes indemnification for IP infringement, regulatory violations
• Covers termination rights, renewal options, and post-termination obligations․

Download a free Distribution Agreement template to describe the appointment of a distributor, territory, products, pricing, orders, shipment, termination conditions, etc․ Edit the template in Word or PDF․ Customize it to your business needs․ Sign electronically and it will be legally binding․

Who It’s For

This Distributor Agreement template is suitable for:

• Manufacturers appoint regional or international distributors
• Product companies targeting new markets․
• Brand owners enter into exclusive distribution agreements
• Reselling arrangements among import/export businesses
• Distributors looking for clearly defined rights
• Legal and operations teams standardize channel agreements

This template acts as a legal contract if you want to provide distribution rights in a defined territory for physical products․

If needed, you can pair this Distribution Agreement template with a Non-Disclosure Agreement (NDA) for confidential negotiations and a Master Service Agreement (MSA) if substantial services are part of the relationship.

What’s Included in the Distribution Agreement Template

This Distributor Agreement includes all essential commercial and legal clauses required for a professional distribution relationship. Namely:

• Territory definition
• Product scope (Schedule A)
• Pricing and discount schedule (Schedule B)
• Exclusivity structure
• Payment terms
• Shipment/Incoterms
• Term and renewal
• Indemnification scope
• Limitation of liability cap
• Governing law

How to Write Your Distributor Agreement (Sample)

This guide explains each provision of this Distributor Agreement template and provides practical legal understanding on how to write it to reduce your risk and avoid costly disputes․

Step 1: Parties and Effective Date

Do not use trade names․ Use the full registered name (e․g․, "ABC Manufacturing LLC")․ If you contract with the wrong entity, it may be difficult to enforce the contract․ You should check that the person who signs the contract has authority to bind the company․

Step 2: Appointment and Grant of Distribution Rights

This section states whether or not the distributor has exclusive rights․

If exclusive define whether it is an exclusivity for all customers or only for certain sales channels (e․g․ retail, wholesale, e-commerce)․ Define whether the company can service key accounts inside the territory․

What to fill in:

• Check exclusive or non-exclusive
• Clearly define the territory (country, region, or specific states)
• Specify if online sales into the territory are included or excluded
• List product categories covered

Step 3: Products

Instead of including the products in the body of the distributor agreement template, a schedule can be annexed for easier product updates without re-doing the whole template․

What to fill in:

• Exact product names
• SKUs or model numbers
• Versions or technical specifications
• Attach as a schedule if product list may change

The clause should also allow new products to be added by mutual written agreement and, if applicable, also require a formal amendment for any expansion․

Step 4: Sub-Distributors

The template further provides the distributor is fully responsible for any actions taken by its sub-distributors, otherwise there would be potential liability gaps․

Step 5: Order Submission and Acceptance

What to fill in:

• Days for order acceptance (e.g., 5 days)
• What happens if the company does not respond
• Shipment terms

Step 6: Pricing and Volume Discounts

To avoid inflationary or supply chain costs making the contract sub-economical, use a price adjustment clause with a cap (eg 5% or 10% annual maximum increases)․ Accepted orders are protected from changes in the price․

What to fill in:

• Base product prices
• Discount tiers based on order volume
• Maximum annual price increase percentage
• Notice period before price changes

Step 7: Shipment Terms and Risk Transfer

This Distribution Agreement template uses EXW (Ex Works) by default. If you want more control over logistics, consider FCA or FOB terms instead.

What to fill in:

• Confirm EXW or change Incoterm
• Specify shipment location
• Define when title transfers
• Insert inspection period (e.g., 10 business days)

Step 8: Payment Terms

What to fill in:

• Deposit percentage (e.g., 30% upon acceptance)
• Balance due timing (e.g., within 10 days of receipt)
• Payment method (wire transfer details)
• Late payment penalties (if applicable)

Step 9: Term and Renewal

Deny multi-year renewal rights without performance review․

What to fill in:

• Initial term length (e.g., 2 years)
• Automatic renewal or mutual renewal
• Notice period for non-renewal

Step 10: Governing Law and Signatures

You should pick a jurisdiction that will realistically enforce this judgment, given these distribution efforts․

All the rest clauses in this Distributor Agreement template sample can go as is (with minimal or no modification).

After completing these sections, review all schedules and execute the agreement in Word, PDF, or through electronic signature.