Increasingly, software is being developed following agile approaches in a distributed setup. An agile setting is typically characterized by flexibility, in order to meet customer demands for continuous delivery of business value. Distributed setting brings about multiple demands for stability, in terms of a push for clear specification of requirements and design, and a big picture product definition. Therefore, implementing agile projects in a distributed setting result in an inherent conflict that needs to be reconciled. We conducted two case studies of agile distributed product development projects to examine the nature of conflict as well as mitigating mechanisms followed by the software teams. Our findings reveal that the domain of agile engagement, as well as the specific distributed team configuration determines the flexibility and stability dimension of the conflict respectively. Furthermore, the software teams achieve a balance between them through the project context characterized by role specification and boundary spanning.