A distribution service agreement is a contract between a supplying company with products to sell and a separate company that markets and sells them. To become a Manufacturer or Distributor you must complete a Manufacturer and.Distributor License Application (DSD10). The advantages of a written agreement may not outweigh the cost of disrupting a smoothly functioning distributor relationship. Generally, Virginia law does not require that contracts contain specific terms nor that mandatory terms be read into them. A license and distribution agreement is a legal, written contract between two parties who wish to share the rights to a brand, patent, or trademark.