UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
--------------
FORM 8-K
--------------
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) October 1, 2007
--------------
CHINA DIRECT, INC.
------------------
(Exact name of registrant as specified in its charter)
Florida 0-26415 13-3876100
---------------------------- ----------------- ------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
5301 North Federal Highway, Suite 120, Boca Raton, Florida 33487
--------------------------------------------------------------
(Address of principal executive offices) (Zip Code
Registrant's telephone number, including area code (561) 989-9171
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
Item 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION
UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
Effective October 1, 2007, CDI China, Inc. ("CDI China"), a Florida
corporation and wholly owned subsidiary of China Direct, Inc. ("China Direct"),
entered into a joint venture agreement (the "Agreement") with Shanxi Jinyang
Coal and Coke Group Co., Ltd. a Chinese limited liability company ("Jinyang
Group") and Runlian Tian, a Chinese limited liability company ("Runlian") which
own a 55% equity interest and 45% equity interest, respectively, of Shanxi
Jinyang Metal Chemical Co., Ltd. ("Jinyang Metal).
Under the terms of the Agreement, the parties will form and CDI China
will own 51% of CDI Pan Magnesium Co., Ltd., a Chinese limited liability company
and new joint venture foreign investment entity ("FIE") pursuant to the laws of
the Peoples Republic of China, with total registered capital of $13.23 million.
China Direct will contribute a total of $6.75 million as registered capital
which will be staged over the course of two years. The initial installment of
$2.035 million was provided by China Direct on October 1, 2007. Jinyang Group
and Runlian will contribute the assets of Jinyang Metal valued at $6.48 million.
CDI Pan Magnesium currently has a production capacity of approximately
6,000 tons of magnesium per year and is completing the construction of 2 new
facilities which will add an additional 12,000 tons annually in 2008.
Jinyang Group is the minority owner of CDI Magnesium Co., Ltd., a
Brunei corporation, and a majority owned subsidiary of CDI China, which was
formed to operate a newly constructed magnesium plant in Taiyuan, China. CDI
China acquired its majority interest in CDI Magnesium Co. Ltd. from Jinyang
Group in February 2007.
Financial statements required under Item 9.01 of Form 8-K will be
filed in an amended report in accordance with the requirements of the Form.
Item 7.01 REGULATION FD DISCLOSURE.
On October 1, 2007, China Direct issued a press release regarding this
transaction. A copy of the press release is attached hereto as Exhibit 99.1 and
incorporated by reference herein.
The information contained in the press release attached hereto is being
furnished and shall not be deemed filed for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise
subject to the liability of that Section, and shall not be incorporated by
reference into any registration statement or other document filed under the
Securities Act of 1933, as amended, or the Exchange Act, except as shall be
expressly set forth by specific reference in such filing.
Item 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits
99.1 Press Release dated October 1, 2007.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: October 4, 2007
CHINA DIRECT, INC.
By: /s/ David Stein
------------------------
David Stein
Chief Operation Officer