UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934

Filed by the Registrant x

Filed by a Party other than the Registrant o

Check the appropriate box:

FUSHI COPPERWELD, INC.

(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

(1) Amount Previously Paid: 

(2) Form, Schedule or Registration Statement No.:

(3) Filing Party:

(4) Date Filed:

 TYG Center Tower B, Suite 2601

Dongsanhuan Bei Lu, Bing 2

Beijing, PRC 100027

_________________________

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD ON JUNE 28, 2012

_________________________

TO THE STOCKHOLDERS OF FUSHI COPPERWELD, INC.:

You are cordially invited to attend the Annual Meeting of Stockholders of Fushi Copperweld, Inc., a Nevada corporation, to be held at the TYG Center Tower B, Suite 2601, Dongsanhuan Bei Lu Bing 2, Chaoyang District, Beijing, China on the 28th day of June, 2012, at 10:00 a.m. Beijing Standard Time (local time), or any adjournment thereof (the “Annual Meeting”), for the following purposes:

Your vote is important. You are requested to carefully read the Proxy Statement and accompanying Notice for a more complete statement of matters to be considered at the Annual Meeting.

IMPORTANT

Whether or not you expect to attend the Annual Meeting, you are respectfully requested by the Board of Directors to sign, date and return the enclosed proxy promptly, or follow the instructions contained in the Notice of Availability of Proxy Materials to vote on the Internet or by telephone. If you grant a proxy, you may revoke it at any time prior to the Annual Meeting or vote in person at the Annual Meeting. If you received this Proxy Statement in the mail, a return envelope is enclosed for your convenience.

PLEASE NOTE: If your shares are held in street name, your broker, bank, custodian, or other nominee holder cannot vote your shares in the election of directors or with respect to executive compensation unless you direct the nominee holder how to vote, by returning your proxy card or by following the instructions contained in the Notice of Availability of Proxy Materials to vote on the Internet or by telephone.

TYG Center Tower B, Suite 2601

Dongsanhuan Bei Lu, Bing 2

Beijing, PRC 100027

______________________________

 PROXY STATEMENT

FOR

ANNUAL MEETING OF STOCKHOLDERS

June 28, 2012

________________________________

PROXY SOLICITATION

Fushi Copperweld, Inc., a Nevada corporation (the “Company”), is soliciting proxies on behalf of the Board of Directors in connection with the annual meeting of stockholders, to be held at the TYG Center, Tower B, Suite 2601, Dongsanhuan Bei Lu, Bing 2, Chaoyang District, Beijing, China on the 28^th day of June, 2012, at 10:00 a.m. Beijing Standard Time (local time) or any adjournment thereof (the “Annual Meeting”), for the following purposes:

The Board of Directors set May 7, 2012, as the record date (the "Record Date") to determine those holders of common stock, par value $0.006 per share, of the Company (the “Common Stock”) who are entitled to notice of, and to vote at, the Annual Meeting. April 27, 2012, is the approximate date on which the proxy statement and form of proxy will first be made available to stockholders.

On or about May 14, 2012, the Company shall mail to all stockholders of record, as of the Record Date, a Notice of Availability of Proxy Materials (the “Notice”). Please carefully review the Notice for information on how to access the Notice of Annual Meeting, Proxy Statement, proxy card and Annual Report on www.proxyvote.com, in addition to instructions on how you may request to receive a paper or email copy of these documents. There is no charge to you for requesting a paper copy of these documents.

GENERAL INFORMATION ABOUT VOTING

Record Date; Outstanding Shares

Only stockholders of record at the close of business on the Record Date are entitled to receive notice of, and vote at our Annual Meeting. As of the Record Date, the Company will have outstanding 38,289,886 shares of Common Stock, being the only class of stock entitled to vote at the Annual Meeting.

Voting and Votes Required for Approval

Every stockholder of record is entitled to one vote, for each share held, on each proposal or item that comes before the Annual Meeting. There are no cumulative voting rights. By submitting your proxy, you authorize Mr. Li Fu, or any person designated as his substitute, to represent you and vote your shares at the Annual Meeting in accordance with your instructions. If the Annual Meeting is adjourned, Mr. Li Fu or his substitute, will be authorized to vote your shares at any adjournment or postponement of the Annual Meeting.

If you have received a printed copy of these materials by mail, you may simply complete, sign and return your proxy card in the enclosed return envelope that is provided.

In accordance with the rules and regulations adopted by the Securities and Exchange Commission (the “SEC”), instead of mailing a printed copy of our proxy materials to each stockholder of record, we may now furnish proxy materials to our stockholders on the Internet. If you received a Notice by mail, you will not receive a printed copy of the proxy materials, unless you request them. Instead, the Notice will instruct you as to how you may access and review all of the important information contained in the proxy materials via the Internet. The Notice also instructs you as to how you may submit your proxy on the Internet. If you received a Notice by mail and would like to receive a printed copy of our proxy materials, including a proxy card, you should follow the instructions for requesting such materials included in the Notice.

We provide Internet proxy voting to allow you to vote your shares on-line, with procedures designed to ensure the authenticity and correctness of your proxy vote instructions. However, please be aware that you must bear any costs associated with your Internet access, such as usage charges from Internet access providers and telephone companies.

Proposal 1: Election of Directors. Directors are elected by a plurality vote, and the seven nominees who receive the most votes will be elected. In the election of Directors, votes may be cast in favor of all nominees, to withhold voting with respect to all nominees, or to withhold voting with respect to specific nominees.

Proposal 2: Ratification of Appointment of Auditors. The affirmative vote of a majority of the shares of Common Stock that are voted either in person or represented by proxy is necessary for ratification of the appointment of our auditors. An abstention or a broker non-vote will not affect the outcome of a such vote with respect to Proposal 2.

Proposal 3: Advisory Vote To Approve Executive Compensation. The advisory vote is not binding on the Company, the Board of Directors, or management.. A majority of votes cast is necessary for approval of executive compensation. An abstention or a broker non-vote will not affect the outcome of a such vote with respect to Proposal 3.

Revocability of Proxies

If you attend the Annual Meeting, you may vote in person, regardless whether you have submitted a proxy. Any person giving a proxy may revoke it at any time before it is voted. A proxy may be revoked by:

Tabulation of Votes

The votes received by proxy will be tabulated and certified by our transfer agent Continental Stock Transfer. All other votes will be tabulated by an inspector of election at the meeting.

Voting by Street Name Holders

If you are the beneficial owner of shares held in "street name" by a broker, the broker, as the record holder of the shares, is required to vote those shares in accordance with your instructions. If you do not give instructions to the broker, the broker will nevertheless be entitled to vote the shares with respect to "routine” matters but will not be permitted to vote the shares with respect to "non-routine” matters (in which case, the shares will be treated as "broker non-votes").  Only Proposal No. 2 “Ratification of the Appointment of Auditors” is a routine item. If you fail to direct your broker how to vote on Proposal No. 1 “Election of Directors,” or Proposal No. 3 “Advisory Vote to Approve Executive Compensation,” your broker is not permitted to vote on your behalf.

Quorum; Abstentions; Broker Non-Votes

The required quorum for the transaction of business at the Annual Meeting is holders of a majority of the shares of Common Stock issued and outstanding and entitled to vote in person or by proxy. If you sign and return your proxy card, or submit your proxy on the Internet, your shares will be counted to determine whether the Company has a quorum, even if you abstain or fail to vote on any of the proposals listed on the proxy card.

 Under Nevada law, while broker non-votes (i.e., the votes of shares held by brokers as to which the underlying beneficial owners have given no voting instructions) and abstentions should be counted for purposes of determining the presence or absence of a quorum for the transaction of business, neither broker non-votes nor abstentions are required to be counted for purposes of determining the number of votes cast with respect to the particular proposal on which the broker has expressly not voted. We intend to treat broker non-votes and abstentions in this manner. Thus, a broker non-vote or abstention will make a quorum more readily obtainable, but the broker non-vote or abstention will not otherwise affect the outcome of the vote on a proposal.

Expenses of Soliciting Proxies

In addition to solicitations by mail, we may solicit proxies in person, by telephone, facsimile or e-mail. In the event that additional solicitation material is used, it will be filed with the SEC prior to its use. We will pay any expenses of soliciting proxies to be voted at the Annual Meeting.

Delivery of Documents to Stockholder Sharing an Address

Only one Notice of Internet Availability of Proxy Materials will be delivered to multiple stockholders sharing an address, unless we have received contrary instructions from one or more of the stockholders. Upon written or oral request, the Company will deliver a separate copy of the Notice of Internet Availability of Proxy Materials to a stockholder at a shared address to which a single copy of the Notice of Internet Availability of Proxy Materials was delivered. If you wish to receive a separate copy of the annual report or this proxy statement, please notify the Company by calling or sending a letter to the Secretary of the Company, c/o Fushi Copperweld, Inc., at the Company’s America’s Headquarter office located at 215 Centerview Drive, Suite 360, Brentwood, Tennessee 37027, U.S.A. The Company’s telephone number at the Tennessee location is +1.617.377.4183. Also, stockholders who share an address and receive multiple copies of the Notice of Internet Availability of Proxy Materials can notify the Company in writing or orally at the above provided address and telephone number and request that the Company deliver a single copy of these materials.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information as of April 20, 2012 with respect to the beneficial ownership of the Common Stock by (i) any person or group owning more than 5% of the Common Stock, (ii) each director, (iii) each executive officer, and (iv) all executive officers and directors as a group.

In determining beneficial ownership of the Common Stock, the number of shares shown includes shares that the beneficial owner may acquire upon exercise of derivative securities, such as warrants or options, within 60 days. In determining the percentage of Common Stock beneficially owned by a person on April 20, 2012, (a) the numerator is the number of shares of the Common Stock beneficially owned by such person, and (b) the denominator is the sum of (i) the total shares of Common Stock outstanding on April 20, 2012 which is 38,289,886, and (ii) the total number of shares that the beneficial owner may acquire upon exercise of the derivative securities. Unless otherwise stated, each beneficial owner has sole power to vote and dispose of the shares.

____________

* Less than one percent

 Changes in Control

We are not aware of any arrangements, including any pledge by a person of securities of the Company, the operation of which may at a subsequent date result in a change in control of the Company. 

PROPOSAL NO. 1

ELECTION OF DIRECTORS

Our Board of Directors presently consists of seven members. The Board of Directors has nominated the persons identified below for election as directors, to serve until the next annual meeting of stockholders or until a successor has been duly elected and qualified or until his or her earlier resignation, removal from office, death or incapacity. In the event that any nominee is unable or declines to serve as a director at the time of the Annual Meeting, the proxies will be voted for any nominee who shall be designated by the Board of Directors. Mr. Barry Raeburn, a current member of our Board of Directors, will not stand for re-election.

Section 4.03(a) of our By-laws gives power to our Board of Directors to change the number of directors of the Company by resolution, and Section 4.04 of our By-laws allows any vacancies, including those created by an increase in the number of directors, to be filled by a vote of the majority of remaining directors. Accordingly, the Board of Directors may do so from time to time between annual meetings of stockholders.

The following table sets forth the names and ages of all current directors and all persons nominated or chosen to become directors along with their current positions, offices and term:

Nominees

The following provides information with respect to the principal occupation or employment of the nominees, the name and principal business of the corporation or other organization in which such occupation or employment is carried on and other affiliations and business experience during the past five years has been furnished to us by the respective nominees:

Mr. Li Fu was appointed our Chairman and CEO on December 13, 2005. Since November 2009, Mr. Fu has served as our Co-Chief Executive Officer. Mr. Fu is a founder of Dalian Fushi, a Company predecessor, and has served as the Chief Executive Officer since the Company commenced operations in 2001. Mr. Fu graduated from the PLA University of Science and Technology with a degree in Engineering. Mr. Fu has (i) extensive operating and managerial experience in domestic and international businesses, specifically wire and cable company operations; (ii) leadership and communication skills; (iii) substantial experience in advancing growth strategies; and (iv) significant experience involving acquisitions. 

Mr. Joseph J. Longever was appointed as our Co-Chief Executive Officer on November 23, 2009. He served as Chief Commercial Officer of Fushi Copperweld from July 2009 to November 2009. Prior to Fushi Copperweld, he ran an independent consulting service which he founded in 2007. From 1999 to 2007 he held various Senior Management, Sales, Marketing and operations within Copperweld Bimetallics, which we acquired in 2007, including Vice President and Chief Operations Officer. Mr. Longever has also served as Executive Vice President and General Manager at Crest Manufacturing Company and held sales roles at Texas Instruments. Mr. Longever graduated from Nathaniel Hawthorne College with a bachelor of science degree in business administration. Mr. Longever has (i) extensive operating and managerial experience in domestic and international businesses, specifically wire and cable company operations; (ii) leadership and communication skills; (iii) substantial experience in advancing growth strategies, including acquisitions and strategic alliances; (iv) experience with major sales channels; (v) significant experience in organizational development and talent development; and (vi) broad experience in corporate governance. The Board believes Mr. Longever provides valuable insight and perspective on general strategic and business matters, stemming from his extensive executive and management experience within the bimetallics industry and Texas Instruments, Inc. 

Mr. Wenbing Christopher Wang has served as our President since January 21, 2008. He also served as our Chief Financial Officer from December 2005 to August 2009 and as our interim Chief Financial Officer from March 2010 to November 2010. Prior to Fushi, Mr. Wang worked for Redwood Capital, Inc., China Century Investment Corporation, Credit Suisse First Boston and VCChina in various capacities. Fluent in both English and Chinese, Mr. Wang holds an MBA in Finance and Corporate Accounting from Simon Business School of the University of Rochester and a bachelor of science degree from the University of Science and Technology, Beijing. During the past five years, Mr. Wang has also served as a director of China Integrated Energy, Inc. (OTC Pink:CBEH), General Steel Holdings (NYSE: GSI), Orient Paper, Inc. (NYSE Amex: ONP), Shengtai Pharmaceutical, Inc. (OTCBB: SGTI) and Energroup Holdings Corporation (Pink Sheets: ENHD). Mr. Wang has (i) extensive a strong financial background in investment banking and investment management; (ii) leadership and communication skills; (iii) extemsive experience in advancing growth strategies, including acquisitions and strategic alliances; and (iv) broad experience in corporate governance.

Mr. Feng Bai. Mr. Bai founded Lighthouse Consulting Ltd. in Hong Kong in February 2003 and has been its President since then. Mr. Bai has also been a Managing Director at Peak Capital Advisory Ltd. since 2007. Mr. Bai has been active in advising foreign corporations to invest and setup joint ventures in the PRC. Since 1999, Mr. Bai has been doing business in China mainly in consulting, investment and distribution. From 1997 to 1999, Mr. Bai was employed by the investment banking division of Banco Santander, focusing on clients and transactions in Asia. Mr. Bai received his MBA degree from Harvard Business School in 1997 and graduated from Babson College in 1993 with a bachelor of science degree in Finance/Investment and International Business Administration. Mr. Feng Bai has (i) a strong financial background in investment management; (ii) substantial experience in advancing growth strategies, including acquisitions and strategic alliance; and (iii) broad experience in corporate governance. Mr. Bai’s experience as a director of large, publicly-traded multinational corporations enables him to provide meaningful input and guidance to the Board and as Chairman of the Compensation Committee.

Mr. Jiping Hua. Most recently, Mr. Hua served as Chairman of China Optical & Electrical Cable Association, where he served since 1998 until his retirement in 2008, and is a preeminent expert in the wire and cable industry of the People’s Republic of China. Mr. Hua brings to Fushi Copperweld over 40 years of experience focused on the research and development of special cable and new materials applications. Mr. Hua was one of the major authors of the widely used textbook, “Information Transmission Line and Applications”. Over the years, Mr. Hua has been awarded the prestigious title of “Expert with Outstanding Contributions” by the Ministry of Electrical Industry of China and has been the recipient of National Special Allowance to Outstanding Scientists from the Chinese government. Mr. Hua was also a member of the 10^th Shanghai People’s Congress, former President of the 23^rd Research Institute of Electronics Industry, Fellow of the China Institute of Electronics (CIE), Senior Member of the Institute of Electrical and Electronics Engineers (IEEE) and Director of the Shanghai Science & Technology Veterans Association. Mr. Hua graduated from the Shanghai Jiao Tong University in 1962 with a bachelor of science degree in Electrical Engineering. Mr. Hua has (i) extensive experience in the wire and cable industry; (ii) substantial managerial experience; (iii) a background in telecommunications products; and (iv) broad experience in corporate governance.

Mr. John Francis “Jack” Perkowski. Mr. Perkowski is currently Managing Partner at JFP Holdings, a merchant banking firm he founded in January 2009 that is focused on China.  Prior to JFP Holdings, Mr. Perkowski served as Chairman and Chief Executive Officer of ASIMCO Technologies Limited for 15 years, one of the premier automotive component companies in the PRC, which he founded in February 1994. ASIMCO operates 17 manufacturing facilities in the PRC and has 52 sales offices throughout the country as well as regional offices in Detroit, Michigan, Tokyo, Japan and the United Kingdom. Mr. Perkowski brings to Fushi Copperweld over 30 years of investment banking experience, having held the positions of Managing Director at Paine Webber Inc., Partner of Kluge, Subotnick and Perkowski, Inc., an investment partnership in the United States, and Principal of Pacific Alliance Group, a hedge fund investing in Asia. Mr. Perkowski is the author of “Managing the Dragon: How I’m Building a Billion Dollar Business in China,” a sought after speaker on business in the PRC and author of numerous articles on the subject of the PRC and doing business in the PRC. Mr. Perkowski received an MBA from Harvard University’s Graduate School of Business Administration, graduating with highest distinction and named a Baker Scholar, and also graduated from Yale University, cum laude, where he was the recipient of the Gordon Brown Memorial Prize. Mr. Perkowski has (i) a strong financial background in investment banking and investment management; (ii) leadership and communication skills; (iii) substantial experience in advancing growth strategies, including acquisitions and strategic alliances; (iv) broad experience in corporate governance; and (v) substantial operating and management experience in manufacturing business. Mr. Perkowski’s extensive operational, financial, and executive management experience and understanding of corporate governance matters have proven to be valuable to our Board and in his positions as Chairman of the Audit Committee and Nominating Committee. 

Mr. Chongqi Huang. Mr. Huang currently sits as a member of the Chinese Academy of Engineering, the national academy of the People’s Republic of China for engineering. Mr. Huang was received a life-time appointment to the Chinese Academy of Engineering as an Academician in 1997 due his significant contributions to research and development within the wire and cable industry in China, specifically in relation to his work within electrical conductive materials and products. Mr. Huang also currently serves as Vice General Engineer at the Shanghai Electric Cable Research Institute (SECRI), where he has held various Engineering and Director positions since 1957. Founded in 1957, SECRI, the national first-rate scientific research institution in China originally under the direct control of the State Council, is now the centre of scientific research, design, test, information and trade affairs of the China Wire & Cable Industry. Mr. Huang received a degree from Northeastern University in Shengyang, Liaoning, where he focused his studies on non-ferrous metals.  Mr. Huang has (i) extensive scientific, commercial and managerial experience in domestic and international businesses; (ii) leadership and collaboration skills; and (iii) a wire and cable background with broad experience in bimetallic wire and cable products.

Family Relationships

There are no family relationships among our directors, nominees or executive officers.

THE BOARD OF DIRECTORS

Our Board of Directors held a total of two (2) meetings during the year ended December 31, 2011. In addition, the Board of Directors acted two (2) times by unanimous written consent during the same period. During the year ended December 31, 2011, our directors attended 100% of the meetings of the Board of Directors and meetings of the Board Committees. It is the policy of the Board of Directors that all directors attend our annual meetings of stockholders, in person, except for causes beyond the reasonable control of the director. Last year all directors attended.

The Company has adopted a Code of Business Conduct and Ethics (“Code”) and a Code of Ethics for the Principal Executive Officer and Senior Financial Officers. As described in the Code, the Company does not permit activities that give rise to conflicts of interest by directors, executive officers or employees. With regard to directors, our corporate governance guidelines establish directors’ duties to adhere to the Code, specifically including the policies on conflicts of interest expressed therein, and to avoid any action, position or interest that conflicts with an interest of the Company, or gives the appearance of a conflict.

Our Code is available on our website at www.fushicopperweld.com. Any amendment to, or waiver from, a provision of the Code of ethics will be posted on our website or in a report on Form 8-K.

BOARD LEADERSHIP STRUCTURE AND ROLE IN RISK OVERSIGHT

Currently, Mr. Li Fu holds the position as Co-CEO and chairman of the Board of Directors of the Company. The Board of Directors believes that the Company and its stockholders have been well served in the past and continue to be well served in the current business environment by this leadership structure. We believe that having the same person serve as both Chairman and Chief Executive Officer helps provide strong, unified leadership for our management team and Board of Directors As such, the board has not designated a lead director. Given the limited number of directors comprising the board, the directors call and plan their executive sessions collaboratively and, between board meetings, communicate with management and one another directly. The directors believe that they are equally capable of monitoring the Company’s operations and that delegating to a lead director functions in which they all participate might detract from rather than enhance performance of their responsibilities as directors.

The Board plays an active role, as a whole and also at the committee level, in overseeing the management of the Company’s risks. The Audit Committee of the Board of Directors regularly meets to review financial and operational items with management and the Company’s independent auditors. Although the Board does not regularly review formal reports from members of senior management and committees on areas of material risk to the Company, including operational, financial, legal, strategic and regulatory risks, the Company’s Board is in regular contact with Co-Chief Executive Officers, both of whom report directly to the Board and who supervise day to day risk management.

BOARD COMMITTEES

Committees of the Board of Directors

We currently have a standing Audit Committee, Compensation Committee and Nominating Committee. Each committee has a written charter approved by the Board of Directors. The following table shows the current membership of each committee.

Director Independence

The Board of Directors has determined that Messrs. Feng Bai, John F. Perkowsk, Jiping Hua, and our director nominee, Mr. Chongqi Huang, are independent under Rule 5605(a)(2) of the NASDAQ Listing Rules.

Audit Committee

The Board of Directors has an Audit Committee established in accordance with Section 3(a)(58) of the Securities Exchange Act of 1934 (the “Exchange Act”). Messrs. Perkowski, Bai and Hua serve on the Audit Committee. The Board of Directors has determined that each of the members of the Audit Committee is “independent,” as defined in Rule 5605(a)(2) of the NASDAQ Listing Rules and Rule 10A-3 under the Exchange Act relating to audit committees. In addition, the Board has determined that all members of the Audit Committee are financially literate and that Mr. Perkowski qualifies as an “audit committee financial expert” as defined by the Securities and Exchange Commission. Mr. Perkowski qualifies as an audit committee financial expert by means of having relevant experience for over 30 years in investment banking, as further described in his biographical information above.

The committee assists the Board of Directors in fulfilling its oversight responsibilities relating to:

·         our auditing, accounting and reporting practices;

·         the adequacy of our systems of internal controls;

·         and the quality and integrity of publicly reported financial disclosures.

In this role, the committee appoints the independent auditors and reviews and approves the scope of the audit, the financial statements and the independent auditors’ fees. The Audit Committee met ten (10) times during the year ended December 31, 2011, and the Chairman met quarterly with management and the external auditors prior to the release of our financial results.

The Audit Committee exercises the powers of the Board of Directors in connection with our accounting and financial reporting practices, and provides a channel of communication between the Board of Directors and independent registered public accountants.

Our Board of Directors has adopted a written charter for the Audit Committee which is available on our company’s website: www.fushicopperweld.com.

 REPORT OF AUDIT COMMITTEE

The information in this Audit Committee Report shall not be deemed to be “soliciting material” or to be “filed” with the Securities and Exchange Commission or to be subject to Regulation 14A or 14C as promulgated by the Securities and Exchange Commission, or to the liabilities of Section 18 of the Securities and Exchange Act of 1934.

The Committee oversees the Company’s financial reporting on behalf of the board of directors.  Management is responsible for the preparation, presentation and integrity of the financial statements, including establishing accounting and financial reporting principles and designing systems of internal controls over financial reporting.  The Company’s independent auditors are responsible for forming and expressing an opinion about whether the financial statements, which have been prepared by management with the oversight of audit committee, are presented fairly, in all material respects, in conformity with U.S. generally accepted accounting principles, as well as performing an audit of the effectiveness of internal control over financial reporting and expressing an opinion thereon based on their audit.

Management has represented to the Committee that the Company’s consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles. The Committee has reviewed and discussed the consolidated financial statements, including significant accounting policies applied by the Company in its consolidated financial statements, as well as alternative treatments, with management and KPMG, the Company’s independent registered public accounting firm. The Committee has discussed with the independent registered public accounting firm all matters required by the standards of the Public Company Accounting Oversight Board (the “PCAOB”), including those described in Statement on Auditing Standards No. 61, communication with Audit Committee as amended.

In addition, the Committee has received the letter from the independent registered public accounting firm required by the applicable PCAOB requirements concerning auditor independence, and the Committee has discussed with the independent registered public accounting firm their independence from the Company and its management. The Committee has also considered whether the independent registered public accounting firm’s provision of non-audit services to the Company could affect their independence. The Committee has concluded that the independent registered public accounting firm is independent from the Company and its management. The Committee has discussed with the Company’s independent registered public accounting firm the overall scope and plans for its audit.

In reliance on the reviews and discussions referred to above, the Committee recommended to the Board of Directors, and the Board of Directors approved the inclusion of the Company’s audited financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011, which was filed with the Securities and Exchange Commission on March 15, 2012.

Audit Committee

John Perkowski (Chair)

Feng Bai

Jiping Hua

Compensation Committee

The purpose of our compensation committee is to discharge the responsibilities of our Board of Directors relating to compensation of our executive officers and oversee and administer our executive compensation programs. The Committee seeks to ensure that the total compensation paid to our named executive officers is fair, reasonable and competitive. In addition, the Compensation Committee determines and approves the compensation of the Co-Chief Executive Officer’s and reviews and has the authority to approve recommendations from the Chief Executive Officer for the compensation of other senior executives, reviews and discusses the Company’s Compensation Discussion and Analysis with management, and produces a report on executive compensation for inclusion in the Company’s Annual Proxy Statement in compliance with applicable federal securities laws. The Compensation Committee also establishes policies dealing with various compensation and employee benefit plans for the Company. Specific responsibilities of our compensation committee include:

·         reviewing and recommending approval to our Board of Directors of compensation of our executive officers;

·         administering our stock incentive plan; and

·         reviewing and making recommendations to our Board with respect to incentive compensation and equity plans.

The members of the Compensation Committee currently are Messrs. Feng Bai, John Perkowski and Jiping Hua. The Committee meets at regularly scheduled times during the year and on an ad hoc basis as business needs necessitate. As part of his duties as the Committee Chair, Mr. Bai reports on Committee actions and recommendations to the Board of Directors. The Compensation Committee met one (1) time during 2011. In addition, the Compensation Committee acted one (1) time by unanimous written consent during the same period. The Compensation Committee charter is currently available on the Company’s website at www.fushicopperweld.com.

COMPENSATION COMMITTEE REPORT

The information in this Compensation Committee Report shall not be deemed to be “soliciting material,” or to be “filed” with the Securities and Exchange Commission or to be subject to Regulation 14A or 14C as promulgated by the Securities and Exchange Commission, or to the liabilities of Section 18 of the Securities and Exchange Act of 1934.

The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis set forth beginning on page 12 required by Item 402(b) of Regulation S-K with management. Based on such review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement on Schedule 14A.

Compensation Committee

Feng Bai (Chairman)

John Perkowski

JiPing Hua

Compensation Committee Interlocks and Insider Participation

None of the Compensation Committee members is, or was ever, an officer or employee of the Company or any of its subsidiaries, nor did any of the Compensation Committee members have any relationship requiring disclosure by the Company under any subsection of Item 404 of Regulation S-K promulgated by the SEC. During the last fiscal year, none of the executive officers of the Company served on the board of directors or on the compensation committee of any other entity, any of whose executive officers serve on the Board.

 Nominating Committee

The purpose of the Nominating Committee of the Board of Directors is to assist the Board of Directors in identifying and recruiting qualified individuals to become Board of Directors members and select director nominees to be presented for Board of Directors and/or stockholder approval. The members of the Nominating Committee currently are Messrs. Jiping Hua, Feng Bai and John Perkowski. The Nominating Committee did not meet during 2011. The Nominating Committee charter is currently available on the Company’s website at www.fushicopperweld.com.

 The Nominating Committee will consider qualified director candidates recommended by stockholders, if such recommendations for director are submitted in writing to the Corporate Secretary, c/o Fushi Copperweld, Inc. at 215 Centerview Drive, Suite 360, Brentwood, Tennessee 37027, U.S.A. Any stockholder wishing to nominate an individual for election to the Board must comply with the advance notice procedures described in the “Stockholders’ Proposals” section at the end of this proxy statement. The nomination must contain the following information about the nominee: name, age, business and residence addresses, principal occupation or employment, the number of shares of common stock held by the nominee, the information that would be required under SEC rules in a proxy statement soliciting proxies for the election of such nominee as a director, and a signed consent of the nominee to serve as a director of the Company, if elected. The Nominating Committee has not specified any minimum qualifications for serving on the Board. However, in its assessment of potential candidates, it will review the candidate’s character, business experience and understanding of our business environment, and ability to devote the time and effort necessary to fulfill his or her responsibilities, all in the context of the perceived needs of the Board at that time. “Diversity,” as such, is not a criterion that the Committee considers. There is no difference in the evaluation process for nominees recommended by a security holder.

EXECUTIVE COMPENSATION

Compensation Discussion And Analysis

Executive Compensation Philosophy and Objectives 

Compensation programs for the Company’s executive officers are designed to attract, retain and motivate employees who contribute to the achievement of corporate goals and objectives. Elements of executive compensation presently consist of base salaries, an annual cash incentive plan and equity compensation, such as stock options, in order to achieve a balance between cash and other compensation. Our compensation program for the individuals named in the Summary Compensation Table (the “named executive officers”) is designed and implemented to maximize value for shareholders over the long term by aligning incentive criteria with that of the long-term goals of the Company, while competing for talent in the rapidly changing and increasingly competitive marketplace. We believe that the quality of the Company’s talent is a key driver of long-term stockholder value. Establishing and maintaining executives’ long-term commitment to us is critical to the development of our product pipeline, as development of new products often takes three years or more, and time to market is critical to our business success.

The primary actions by the Committee in fiscal year 2011 were to insure that senior executives, key employees and consultants were provided incentives to meet the Company’s goals, increase profitability, and maximize value for shareholders over the long term. Furthermore, beginning in fiscal year 2010, the Committee implemented an annual cash incentive plan and amended the Executive Compensation Philosophy in order to accomplish its goals and to ensure that the executive compensation program is consistent with the Company’s direction, stated vision and culture. The Company remains committed to the following philosophy statements:

What is our compensation program designed to reward? 

The compensation program rewards superior financial, strategic and operational performance that is achieved in a manner consistent with the Company’s values. Results and how the results are attained are both critically important. Our executive officers are assessed on the basis of demonstrated results relative to their performance of pre-established goals, ability to assess and adapt to change in a timely and efficient manner, as well as demonstrated competencies and behavioral attributes.

Compensation Program Elements and Pay Level Determination 

What factors are considered in determining the amounts of compensation? 

The Compensation Committee believes that an effective executive compensation program should provide base annual compensation that is reasonable in relation to individual executive’s job responsibilities and reward the achievement of both annual and long-term strategic goals of our company. 

In making its decisions or recommendations regarding the amount of compensation, the Compensation Committee takes into account factors it deems relevant to the specific compensation component being considered, including: compensation paid by other business organizations of comparable size in the same industry and related industries; profitability; the attainment of annual individual and business objectives; an assessment of individual contributions and performance relative to others; and historic compensation awards. Any decision is made by members of the Compensation Committee jointly, and such authority is not delegated to anyone.

The specific items of corporate performance can be grouped into the categories listed below. The Company's performance levels for determining compensation differ by individual based on the individual’s roles, functions and responsibility within the Company.

The Committee considers the totality of the information presented (including external competitiveness, the performance review, Company performance, progress towards strategic objectives and internal equity) and applies its knowledge and discretion to determine the compensation for each executive officer. As a manufacturing company operating on three continents -- Dalian, Liaoning, China; Fayetteville, Tennessee; Liege, Belgium; and Telford, UK, the Committee also takes the local average of executives’ salary level into account in its compensation decisions. The Committee may reassess the proper level of equity and cash compensation in light of the Company’s improved profitability and shareholder value creation. Based on the foregoing objectives, the Committee has structured the Company’s annual cash and incentive-based cash and non-cash executive compensation to motivate executives to achieve the business goals set by the Company, to reward the executives for achieving such goals, and to retain the executives.

What is each element of compensation and why is it paid? 

Each of the elements serve an important role in supporting the Company’s  pay-for-performance philosophy and in realizing our compensation program objectives:

Base Compensation

The Company provides named executive officers and other employees with a base salary to compensate them for services rendered during the fiscal year. Base salary ranges for the named executive officers are determined for each executive based on his or her position and responsibility.

During its review of base salaries for executives, the Committee primarily considers:

Salary levels are typically considered annually as part of the company’s performance review process, as well as upon a change in job responsibility. The Committee considers the facts presented by each individual case including but not limited to the employee’s longevity with the Company, his or her educational background and experience, the particular responsibilities of his or her position, the compensation of others with similar background credentials and responsibilities, and his or her past level of performance, as well as prospective assumptions.  It is important for the Company to remain competitive with not only its domestic competition, but also its competitors participating in world markets.  Therefore, the Company attempts at all levels of management and operations to control costs such that the Company can strive for a relatively low-cost structure.  Merit-based increases to salaries are based on the Committee’s assessment of the individual’s performance. This element is important because, in our experience, prospective employees view salary levels as the most important determinant of where they choose to work.  In order to maintain an advantageous cost structure, it is necessary that the Company provide enhancement to base compensation when certain levels of profitability are achieved.

For 2011, the Committee did not adjust the base salary for our Co-Chief Executive Officer, Mr. Li Fu, for Co-Chief Executive Officer, Mr. Joseph J. Longever, President, Mr. Wenbing Christopher Wang, and Chief Financial Officer, Craig Studwell, from the prior year, remaining at $240,000, $225,000, $200,000, and $180,000, respectively.

Cash Bonus

Executive employment agreements establish an annual cash bonus, subject to overall performance and results on objectives as outlined by the Compensation Committee. Such bonuses are reviewed and confirmed at the beginning of each year by the Compensation Committee. In 2011, our named executive officers were entitled to receive up to the following cash bonus amounts: Mr. Fu — $240,000; Mr. Longever — $225,00; Mr. Wang — $200,000; and Mr. Studwell — $180,000. These bonuses were granted per the 2011 Cash Incentive Plan (described below) developed and approved by the Compensation Committee based on the achievement of certain corporate and financial objectives.

Performance Based Cash Incentive Plan

The 2011 Cash Incentive Plan is designed to tie executive pay to Company performance by incentivizing key executives to achieve our annual goals, including financial, operating and individual performance goals. Awards are paid by March 15 of the following year if the Compensation Committee determines the goals are achieved. The Compensation Committee also has the ability to increase an award up to a maximum of fifteen (15) percent of the target or to reduce an executive’s performance-based award.

We believe this program supports our compensation objective of motivating executives to achieve high levels of performance. Participation in the plan currently is limited to Executive Officers of the Company as selected by the Compensation Committee. All participants are assigned to a Plan Tier Level as set forth below.

Target awards for executives vary as a percent of base salary based on the executive’s position. Target and actual awards in dollars and as a percent of base salary (in effect on December 31, 2010) for 2011 incentive awards paid in 2012 were as follows:

For 2011, awards under the Executive Annual Incentive Plan reflect a focus on compensation for Company performance, with an allocation of 90 percent to corporate performance goals (earnings per share (“EPS”) and return on employed capital goals) and an allocation of 10 percent to individual performance criteria established for each executive.

Corporate Performance Goals. In 2011, the corporate performance goals established by the Compensation Committee for the 2011 Cash Incentive Plan were designed to reward participants for exceeding the Company’s budgeted operating results by emphasizing the achievement of EPS and return on employed capital targets. The Compensation Committee sets the ranges and targets taking into account management’s annual objectives and the way in which those annual objectives fit within the larger growth goals for the Company.

Earnings Per Share factor. The Compensation Committee concluded that EPS would be accorded a weight of 60 percent to align executives’ interests with shareholders’ interests and in recognition of the importance earnings have in influencing our future stock price. For 2011, the EPS performance goal consisted of a range of adjusted EPS results from $.80 per share to $1.75 or above, corresponding to payout factors ranging from 0 percent to 150 percent. The target level of adjusted EPS was $1.25 per share, corresponding to a 100 percent payout factor.

Actual 2011 adjusted EPS was $0.84, or $0.41 below the 2011 target of $1.25, resulting in an EPS factor equal to 100 percent, which was calculated according to the formula established by the Compensation Committee at the beginning of the year.

For 2011, the Earnings Per Share factor produced an overall corporate performance factor equal to 25 percent of target.

Return on Employed Capital factor. The weighting assigned to the Return on Employed Capital factor was 30 percent. Return on Employed Capital is defined as EBIT divided by total assets minus current liabilities. This goal consisted of a range of results from 7.3 percent to 22.7 percent or greater, corresponding to payout factors ranging from 0 to 150 percent. The target level of return on invested capital was set at 16.2 percent, which corresponds to a 100 percent payout factor.

Actual 2011 return on employed capital was 12.1 percent, resulting in a return on invested capital factor equal to 100 percent.

For 2011, the Return on Employed Capital factor produced an overall corporate performance factor equal to 25 percent of target.

Individual Performance Goals. For each Named Executive Officer in Tiers A, B or C, 10 percent of the annual cash incentive target award is based on individual performance goals. Generally, 2011 annual individual goals were based on the metrics regarding talent development, operating profit, and corporate governance.

Long-Term Equity Incentives

Long-term incentive awards are granted to the Company’s executives under the 2007 Stock Incentive Plan approved by stockholders in 2007 (“2007 Stock Incentive Plan”). Long-term incentive expected values for total incentive awards are based on a review of current market practices provided by the Company’s Human Resources Team. The actual grant for each executive is determined by the Compensation Committee taking into consideration individual performance, and to a lesser extent Company performance, within the context of market practices.

Historically, the individual performance factors taken into account for purposes of making long-term equity incentive awards by the Committee were generally similar as those outlined in the 2011 Cash Incentive Plan Individual Performance Factors. Company performance metrics such as earnings per share and return on employed capital are taken into account to a lesser extent as they are reflected in individual performance factors in considering long-term incentive awards.

Grants of stock options and restricted stock and other stock awards for executive officers have generally been made on an annual basis, typically on the date of the first meeting of the Compensation Committee. Awards also may be granted at the time of a special event, such as upon employment, a material event or a significant promotion. Option exercise prices and share awards of restricted stock are generally computed based on the fair market value of our common stock on the date of grant. Based on the timing of the previously scheduled Committee meeting and the Company’s earnings release, the Committee in its discretion may approve awards but delay the effectiveness of these awards until after the date of the earnings release to ensure that the award values reflect all material information about the Company.

Tax-deductibility of Compensation 

Section 162(m) of the Internal Revenue Code limits to $1 million the amount a company may deduct for compensation paid to its CEO or any of its four other named executive officers.This limitation does not, however, apply to compensation meeting the definition of “qualifying performance-based” compensation.

Management works with the Committee to assess alternatives to preserve the deductibility under Section 162(m) of compensation payments to the extent reasonably practicable, consistent with our compensation policies and as determined to be in the best interests of the Company and its stockholders. For 2011, the Company believes that the Compensation payments will meet the deductibility requirements of Section 162(m) of the Internal Revenue Code.

Retirement Plans and Social Benefits 

We maintain a pre-tax savings plan covering substantially all U.S. employees, which qualifies under Section 401(k) of the Internal Revenue Code. Under the plan, eligible employees, including executive management, may contribute a portion of their pre-tax salaries, subject to certain limitations. Under the laws of the PRC, we provide social and retirements benefits to executives and employees at our Dalian facility.

SUMMARY COMPENSATION TABLE

The following table shows the compensation (in $’000) paid to or earned by the named executive officers during the Company’s last three completed fiscal years.

Notes to Summary Compensation Table 

(1) Mr. Fu’s salary is paid in RMB using an exchange rate at the time of payment as provided by the People’s Bank of China. Mr. Fu receives labor-related benefits in conformance with PRC labor laws.

(2) Mr. Longever’s annual salary was $150,000 per year beginning with his employment in July 2009 and was then increased to $225,000 per year, effective with his appointment as Co-Chief Executive Officer on November 23, 2009.

(3) Mr. Studwell’s annual salary has been $180,000 per year since his employment, which commenced in October 2010.

4) We typically award such bonus compensation as a result of performance for the indicated year, but the amounts are calculated and paid in the following year.

(5) The Company records and reports stock-based compensation by measuring the cost of services received in exchange for an award of equity instruments based on the grant-date fair value of the award. That cost is recognized over the period during which services are received.

(6) Represents insurance premiums paid by the Company on behalf of the named executive officer.

The fair value of each option award is estimated on the date of grant using the Black-Scholes model using the following weighted-average assumptions (the date below is based on the grant date):

Grants of Plan-Based Awards During 2011

The Company did not issue stock or option awards to Executives and Directors in 2011.

Employment Agreements

On November 8, 2005Mr. Li Fu entered into an employment agreement with (the “Fu Employment Agreement”), which provided that Mr. Fu would serve as the Chief Executive Officer. The term of the Fu Employment Agreement is for a period of ten years unless terminated earlier as set forth in the Fu Employment Agreement. Mr. Fu’s salary during the term shall be $240,000 per year payable every two weeks and may be increased at the discretion of the Compensation Committee of the Board of Directors. The Company shall determine in its sole discretion to pay Mr. Fu any bonus amount above the salary set forth above. The Company may terminate Mr. Fu’s employment without cause but, in the event of such termination, the Company shall pay to Mr. Fu a lump sum equal to all remaining salary payments due under the Fu Employment Agreement for the period beginning on the date of termination and ending on the last day of the term. For purposes of calculating this severance payment, it shall be assumed that the salary will increase by 20% on each anniversary of the effective date, starting from the date of termination. The severance payment shall be payable to Mr. Fu within ten business days of the date of termination. The Fu Employment Agreement also contains covenants regarding non-competition and non-disclosure.

On November 23, 2009, Mr. Joseph Longever entered into an Executive Employment Agreement with the Company (the “Longever Employment Agreement”), which provided that Mr. Longever would serve as the Co-Chief Executive Officer. In accordance with the Longever Employment Agreement, the initial term of employment shall be for five years unless terminated earlier and shall be automatically extended for an additional one-year period upon the same terms and conditions unless a written notice of non-renewal is given by either party at least ninety (90) days before the expiration date of the then current term. Mr. Longever will receive an annual salary of no less than $225,000 per year, such salary to increase at the discretion of the Board of Directors of the Company. In addition to Mr. Longever’s annual base salary, he shall be entitled to participate in an annual cash bonus plan and equity incentive plans sponsored by the Company as may be established from time to time. Pursuant to the terms of the employment agreement and as approved by the Compensation Committee, Mr. Longever was issued an option to purchase 200,000 shares of the Company’s common stock, with an exercise price of $7.93 per share, and was awarded 50,000 shares of restricted stock, which restricted stock vests 20% per completed year of service. If Mr. Longever is terminated without Cause (as defined in the Longever Employment Agreement, but which definition includes occurrence of certain events within 30 days prior to or twelve months following the effective date of a Change in Control (as defined in the Longever Employment Agreement)) or Mr. Longever terminates the Longever Employment Agreement for Good Reason (as defined in the Longever Employment Agreement), and Mr. Longever executes and delivers a valid and effective release of all claims against the Company in a form and format prepared by the Company, Mr. Longever shall be entitled to receive (1) a lump sum cash payment in the amount of any accrued but unpaid salary as of his date of termination, (2) a lump sum cash payment equal to any accrued and unpaid bonus for any prior fiscal year, and (3) an amount equal to the sum of (a) 50% of his then current annual base salary and (b) 50% of the average annual cash bonus payments paid by the Company to Mr. Longever during the preceding three fiscal years; Mr. Longever is also entitled to continued medical and life insurance benefits for a period of six months following the date of termination. In the event of termination without Cause, Mr. Longever has a duty to mitigate the Company’s obligations to him, and any amounts earned by Mr. Longever during the six months following termination shall serve as an offset to the amounts due to him by the Company; there is no such duty to mitigate or offset the Company’s obligations in the event of resignation for Good Reason. In the event that Mr. Longever is terminated for Cause upon thirty days prior written notice, the Company shall pay him any accrued and unpaid salary and any accrued and unpaid bonus for any prior fiscal year. The Longever Employment Agreement also contains covenants regarding non-competition and non-disclosure.

On July 22, 2008, Mr. Wenbing Christopher Wang entered into an employment agreement with the Company (the “Wang Employment Agreement”), which provided that Mr. Wang would serve as the President and Chief Financial Officer of the Company. The initial two-year term of the Wang Employment Agreement was automatically extended for an additional two-year period. Mr. Wang’s base salary is no less than $200,000 per year, which salary may be increased at the discretion of the Board of Directors but in no event shall be decreased. The Board of Directors shall review Mr. Wang’s salary at least on an annual basis. In addition to the base salary, Mr. Wang is entitled to participate in the Company’s annual cash bonus and equity incentive plans. If Mr. Wang is terminated without Cause (as defined in the Wang Employment Agreement) or Mr. Wang terminates the Wang Employment Agreement for Good Reason (as defined in the Wang Employment Agreement), and Mr. Wang executes and delivers a valid and effective release of all claims against the Company in a form and format prepared by the Company, Mr. Wang shall be entitled to receive (1) a lump sum cash payment in the amount of any accrued but unpaid salary as of his date of termination, (2) a lump sum cash payment equal to any accrued and unpaid bonus for any prior fiscal year, (3) a lump sum cash payment equal to the pro rata amount of any bonus payable with respect to the fiscal year in which termination occurs and (4) an amount equal to the sum of (a) 50% of his then current annual base salary and (b) 50% of the average annual cash bonus payments paid by the Company to Mr. Wang during the preceding three fiscal years; Mr. Wang is also entitled to continued medical and life insurance benefits for a period of six months following the date of termination. In the event that Mr. Wang is terminated for Cause upon thirty days prior written notice, the Company shall pay him any accrued and unpaid salary and any accrued and unpaid bonus for any prior fiscal year. The Wang Employment Agreement also contains non-competition and non-disclosure covenants following any termination of Mr. Wang’s employment.

On October 19, 2010, Mr. Craig H. Studwell entered into an Executive Employment Agreement with the Company (the “Studwell Employment Agreement”), which provided that Mr. Studwell would serve as the Executive Vice President, Chief Financial Officer for a three year term. Mr. Studwell’s base salary shall be no less than $180,000 per year, which salary may be increased at the discretion of the Compensation Committee. The Compensation Committee shall review Mr. Studwell’s compensation at least on an annual basis. In addition to the base salary, Mr. Studwell is entitled to participate in the Company’s annual cash bonus and equity incentive plan. If Mr. Studwell is terminated without Cause (as defined in the Studwell Employment Agreement) or Mr. Studwell terminates the Studwell Employment Agreement for Good Reason (as defined in the Studwell Employment Agreement) and Mr. Studwell executes and delivers a valid and effective release of all claims against the Company in a form and format prepared by the Company, Mr. Studwell shall be entitled to receive a lump sum cash payment in the amount of (i) any accrued but unpaid salary as of his date of termination within thirty days of the termination, (ii) any accrued and unpaid bonus for any prior fiscal year, and (iii) an amount equal to the sum of (a) 50% of his then current annual base salary and (b) 50% of the average annual cash bonus payments paid by the Company to Mr. Studwell during the preceding three fiscal years, and such sum shall be payable in six (6) substantially equal monthly payments. Mr. Studwell is also entitled to continued medical and life insurance benefits for a period of six months following the date of termination. In the event that Mr. Studwell is terminated for Cause upon thirty days prior written notice, the Company shall pay him any accrued and unpaid salary and any accrued and unpaid bonus for any prior fiscal year. The Studwell Employment Agreement also contains covenants regarding non-competition and non-disclosure.

Assuming the employment of the Company’s named executive officers were to be terminated without Cause or for Good Reason, as of December 31, 2011 the following individuals would have been entitled to payments in the amounts set forth opposite their name in the below table;

Outstanding Equity Awards at Fiscal Year-End

The following table sets forth, for each named executive officer, information regarding unexercised stock options, unvested stock awards, and equity incentive plan awards outstanding as of December 31, 2011.

(1) The closing price of Fushi Copperweld stock on December 30, 2011 was $7.52

Option Exercises and Stock Vested

The following table sets forth aggregate information with respect to each executive officer regarding exercise of stock options and vesting of restricted stock for fiscal year 2011.

Pension Benefits Table

None

Nonqualified Defined Contribution and Other Nonqualified Deferred Compensation Plans Table

None

Equity Compensation Plan Information at December 31, 2011

The following tabular disclosure provides information as of December 31, 2011 regarding the Company’s common stock authorized for issuance under equity compensation plans.

We use a combination of cash and stock-based compensation to attract and retain qualified candidates to serve on our board of directors. Directors who also are employees of our company currently receive no compensation for their service as directors or as members of board committees. In setting non-employee director compensation, we consider the significant amount of time that directors dedicate to the fulfillment of their director responsibilities, as well as the competency and skills required of members of our board.

The current compensation schedule includes ( i) annual cash compensation of $15,000; (ii) options to purchase 50,000 shares of our common stock at exercise price equal to the grant day’s stock price, with 12,500 shares immediately vested and the balance vesting 4,687 shares each quarter for eight quarters; (iii) $1,000 per full board meeting attended; (iv) $500 per full committee meeting attended. The directors’ current compensation schedule has been in place since June 2007. The Audit Committee Chair receives additional annual compensation of $5,000.

The directors’ annual compensation year begins with the annual election of directors at the annual meeting of shareholders. Periodically, our board of directors reviews our director compensation policies and, from time to time, makes changes to such policies based on various criteria the board deems relevant. Non-employee directors are reimbursed for travel, lodging and other reasonable out-of-pocket expenses incurred in attending meetings of our board of directors and for meetings of any committees of our board of directors on which they serve.

SHAREHOLDER COMMUNICATIONS

We encourage shareholder communications to the Board of Directors and/or individual Directors. Shareholders who wish to communicate with the Board of Directors or an individual Director should send their written communications to The Board of Directors, c/o Fushi Copperweld, Inc., 215 Centerview Drive, Suite 360, Brentwood, Tennessee 37027, U.S.A.

TRANSACTIONS WITH RELATED PERSONS, PROMOTERS

AND CERTAIN CONTROL PERSONS

In December 2011, Mr. Li Fu advanced $2,000,000 to Fushi to facilitate timely payment of certain expenses of Fushi. The advance is non-interest bearing and was due on demand. In January 2012, the unused balance of $1,800,000 was repaid to Mr. Li Fu by Fushi in cash. The imputed interest of the advance was insignificant.

For the year ended December 31, 2011, 2010 and 2009, the Company rented an office of approximately 800 square meters in Beijing from Mr. Li Fu free of charge. The annual amount of rental fee based on quoted price for similar facilities was $278,505. The Company recognized an expense of $278,505 and a corresponding amount to additional paid in capital for the year ended December 31, 2011. The amount of rental fee based on quoted price for similar facilities was determined to be insignificant for the year ended December 31, 2010 and 2009.

Our board has not adopted a formal policy pertaining to review, approval and ratification of related party transactions, however, our independent directors will review, approve or ratify, when necessary, transactions with related parties on a case by case basis, and, if the proposed transaction is with an independent board member, such member will excuse himself from such review, approval or ratification when deliberating such transaction. The independent directors will consider whether the terms of the transaction are fair to us.

COMPLIANCE WITH SECTION 16(a) OF

THE SECURITIES EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the Company's directors and executive officers, and persons who own more than 10% of a registered class of the Company's equity securities, to file with the Securities and Exchange Commission initial reports of ownership and reports of changes in ownership of common stock and other equity securities of the Company. These insiders are required by Securities and Exchange Commission regulations to furnish the Company with copies of all Section 16(a) forms they file, including Forms 3, 4 and 5. To the Company's knowledge, based solely on review of the copies of such reports furnished to the Company and written representations that no other reports were required, during 2011, and to date, all Section 16(a) filing requirements applicable to its insiders were complied with.

THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE ELECTION AS A DIRECTOR OF EACH OF THE NOMINEES SET FORTH ABOVE. PROXIES SOLICITED HEREBY WILL BE VOTED "FOR" EACH DIRECTOR NAMED ABOVE UNLESS A VOTE AGAINST A NOMINEE OR AN ABSTENTION IS SPECIFICALLY INDICATED.

PLEASE NOTE: If your shares are held in street name, your broker, bank, custodian, or other nominee holder cannot vote your shares in the election of directors, unless you direct the holder how to vote, by marking your proxy card or by following the instructions on the proxy card to vote by telephone or Internet. 

PROPOSAL NO. 2

RATIFICATION OF APPOINTMENT OF AUDITORS

The Audit Committee has engaged KPMG to continue to serve as our independent auditor for the year ending December 31, 2012.  KPMG served as our independent auditors for the year ended December 31, 2011. We expect representatives from KPMG will be in attendance in person at the meeting with the opportunity to make a statement and/or respond to appropriate questions from shareholders present at the meeting.

We are asking the stockholders to ratify the appointment of KPMG as our independent public accounting firm for the year ending December 31, 2012. All proxies will be voted to approve the appointment unless a contrary vote is indicated on the enclosed proxy card.

Change of Independent Auditor

On January 24, 2011, we dismissed our former principal independent accountants, Frazer Frost, LLP (“Frazer”). On the same day, the Company engaged KPMG as its principal independent accountants for the year ended December 31, 2010, effective immediately upon the dismissal of Frazer. The decision to engage KPMG as the Company's principal independent accountants was approved by the Audit Committee of the Company's Board of Directors on January 10, 2011.

During the period from January 1, 2008 through the date of Frazer's dismissal, there were no disagreements with Frazer on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Frazer, would have caused Frazer to make reference to the subject matter of the disagreements in connection with its report on the financial statements for such period. None of the reportable events described under Item 304(a)(1)(v) of Regulation S-K occurred within the period from January 1, 2008 through December 31, 2009 or through the date of Frazer’s dismissal. Frazer issued a letter dated January 26, 2011 addressed to the Securities and Exchange Commission stating that it agrees with the above statements made by the Company.

On January 24, 2011, the Company engaged KPMG as its new principal independent accountants, effective immediately upon the dismissal of Frazer. The decision to engage KPMG as the Company's principal independent accountants was approved by the Audit Committee of the Company's Board of Directors on January 10, 2011. During the period from January 1, 2008 through December 31, 2009, and through the date of the KPMG’s engagement , the Company did not consult with KPMG regarding any of the matters or events set forth in Item 304(a)(2)(i) and (ii) of Regulation S-K.

Fees of Independent Auditors

Our independent accountants for the audit of our annual financial statements and audit of internal control over financial reporting for our fiscal year ended December 31, 2011 and 2010 was KPMG. Our independent accountants for the interim period reviews of our financial statements during 2010 was Frazer Frost, LLP (“Frazer”). The following table shows the fees billed to us by KPMG and Frazer: 

(1) Audit fees were for professional services rendered for the audit of our annual financial statements, audit of internal controls over financial reporting and the review of our quarterly financial statements. We were billed $1,245,500 and $285,000 for the fiscal year ended December 31, 2011 and 2010 by KPMG and Frazer, respectively.

(2) Fees paid to KPMG and Frazer related to tax compliance services.

(3) Fees paid to Frazer related to professional services rendered related to secondary stock offering in January 2010.

Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services

The Audit Committee is responsible for appointing, setting the compensation of and overseeing the work of the independent registered public accounting firm. In recognition of this responsibility, the Audit Committee has established a policy with respect to the pre-approval of audit, audit-related and permissible non-audit services and fees provided by the independent registered public accounting firm. The Audit Committee’s pre-approval policy requires that all audit, audit-related and permissible non-audit services and fees be either pre-approved or specifically approved by the Audit Committee. Pursuant to the pre-approval policy, one or more of the Audit Committee’s independent members may be delegated pre-approval authority, provided he or she reports those approvals at the next meeting of the Audit Committee. The term of any pre-approval granted by the Audit Committee with respect to a given service is 12 months. The payment of all fees in excess of pre-approved levels requires specific pre-approval by the Audit Committee. All audit and permissible non-audit services provided to us in 2011 were approved by the Audit Committee. In the event that we should require substantial non-audit services, the Board of Directors would approve such services and the fees therefore.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE “FOR” RATIFICATION OF THE APPOINTMENT OF THE INDEPENDENT ACCOUNTANTS.

PROPOSAL NO. 3

ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION

Pursuant to Securities Exchange Act Section 14A, we are submitting to stockholders an advisory vote to approve the compensation paid to the Company’s named executive offices, as disclosed under the caption Election of Directors—Executive Compensation, pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables, and narrative discussion.

The advisory vote is not binding on the Company, the Board of Directors, or management; if executive compensation is not approved by a majority of the votes cast, the Compensation Committee will take account of this fact when considering executive compensation in future years.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE “FOR” THE FOLLOWING ADVISORY RESOLUTION:

RESOLVED, that the compensation paid to Company’s named executive offices, as disclosed under the caption Election of Directors—Executive Compensation, pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables, and narrative discussion, be, and hereby is, approved.

OTHER INFORMATION

Important Notice Regarding Availability of Proxy Materials

The Company is making this Proxy Statement and the Company’s Annual Report available on the Internet instead of mailing a printed copy of these materials to each shareholder. Shareholders who received a Notice of Internet Availability of Proxy Materials (the “Notice”) by mail will not receive a printed copy of these materials other than as described below. Instead, the Notice contains instructions as to how shareholders may access and review all of the important information contained in the materials on the Internet, including how shareholders may submit proxies by telephone or over the Internet.

Stockholders' Proposals for Next Annual Meeting

Stockholder proposals intended to be included in the proxy statement for the next annual meeting must be received by Company by January 14, 2013. A stockholder of record may present a proposal for action at the 2013 Annual Meeting of Stockholders provided that we receive such proposal at our executive office no later than March 31, 2013. We anticipate that the 2013 Annual Meeting will be held in the second fiscal quarter of 2012. The proponent may submit a maximum of one (1) proposal of not more than five hundred (500) words for inclusion in our proxy materials for a meeting of security holders. At the 2013 Annual Meeting, management proxies will have discretionary authority, under Rule 14a-4 of the Securities Exchange Act of 1934, to vote on stockholder proposals that are not submitted for inclusion in our proxy statement unless received by us before March 31, 2013.

Other Business

The Board of Directors knows of no business other than that set forth above to be transacted at the meeting, but if other matters requiring a vote of the stockholders arise, the persons designated as proxies will vote the shares of common stock represented by the proxies in accordance with their judgment on such matters. If a stockholder specifies a different choice on the proxy, his or her shares of common stock will be voted in accordance with the specification so made.

Where You Can Find More Information

We file annual and quarterly reports, proxy statements and other information with the SEC.  Stockholders may read and copy any reports, statements or other information that we file at the SEC’s public reference rooms in Washington, D.C., New York, New York, and Chicago, Illinois.  Please call the SEC at 1-800-SEC-0330 for further information about the public reference rooms.  Our public filings are also available from commercial document retrieval services and at the Internet Web site maintained by the SEC at www.sec.gov. The Company’s Annual Report on Form 10-K is available on our website at www.fushicopperweld.com.

STOCKHOLDERS SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROXY STATEMENT TO VOTE THEIR SHARES AT THE ANNUAL MEETING.  NO ONE HAS BEEN AUTHORIZED TO PROVIDE ANY INFORMATION THAT IS DIFFERENT FROM WHAT IS CONTAINED IN THIS PROXY STATEMENT.  THIS PROXY STATEMENT IS DATED APRIL 27, 2012.  STOCKHOLDERS SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN THIS PROXY STATEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THAT DATE, UNLESS OTHERWISE DISCLOSED.

IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. WE URGE YOU TO FILL IN, SIGN AND RETURN THE FORM OF PROXY IN THE PREPAID ENVELOPE PROVIDED, NO MATTER HOW LARGE OR SMALL YOUR HOLDINGS MAY BE.

TYG Center Tower B, Suite 2601

Dongsanhuan Bei Lu, Bing 2

Beijing, PRC 100027

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned acknowledges receipt of the accompanying Notice of Annual Meeting and 2012 Proxy Statement and hereby appoints Li Fu, attorney and proxy, with full power of substitution and resubstitution, to vote all shares of the Common Stock, par value $0.006 per share of Fushi Copperweld, Inc., a Nevada corporation (the "Company"), held of record by the undersigned at the close of business on May 5, 2012 at the annual meeting of stockholders of the Company to be held at the TYYG Center Tower B, Suite 2601, Dongsanhuan Bei Lu, Bing 2, Chaoyang District, Beijing, China on the 28^th day of June, 2012, at 10:00 a.m. Beijing Standard Time (local time), and at any postponement or adjournment thereof, as indicated in this Proxy, and to vote, as designated on the reverse side, all shares of common stock of the Company which the undersigned would be entitled to vote if then and there personally present, on the matters set forth on the reverse side.

IF THIS PROXY IS PROPERLY DATED AND EXECUTED, THE SHARES REPRESENTED HEREBY WILL BE VOTED IN THE MANNER DIRECTED HEREIN AND, IN THE ABSENCE OF DIRECTION THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE BOARD OF DIRECTORS’ RECOMMENDATIONS.

PLEASE MARK, SIGN, DATE AND RETURN IMMEDIATELY. Please mark vote in box using blue or black ink only.

(Instruction: To withhold authority to vote for any individual nominee, write that nominee's name in the space provided above. The undersigned hereby confer(s) upon the proxy and each of them discretionary authority with respect to the election of directors in the event that any of the above nominees is unable or unwilling to serve)

(Continued and to be signed on the reverse side)

2. Ratification of the appointment of KPMG as the Company's independent auditor for the fiscal year ending December 31, 2011.

____ FOR ____ AGAINST ____ ABSTAIN

3. Advisory vote to approve executive compensation

____ FOR ____ AGAINST ____ ABSTAIN

4. As recommended by the Board of Directors, or in the absence of such recommendation in their own discretion, to vote upon such other business as may properly come before said meeting or any postponement or adjournment thereof.

Dated:____________, 2012

Please date this Proxy and sign exactly as the name(s) appears on the enclosed envelope and return the signed Proxy in the enclosed envelope. When shares are held by joint tenants, both should sign. When signing as attorney, executor, administrator, trustee or guardian, please give the full title. If a corporation, please sign in full corporate name by the president or other authorized officer. If a partnership, please sign in the partnership name by an authorized person.

o Please indicate by checking this box if you anticipate attending the Annual Meeting.

THIS PROXY CARD IS ONLY VALID WHEN SIGNED AND DATED. PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED ENVELOPE

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:

The Notice & Proxy Statement, Form 10-K and proxy card is/are available at www.proxyvote.com.