SC 13D/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934
(Amendment No. 3)*

Hollysys Automation Technologies Ltd.

(Name of Issuer)

Ordinary Shares, par value $0.001 per share

(Title of Class of Securities)

G45667105

(CUSIP Number)

Baiqing Shao
Floor 5, Building A7,
Ningbo New Material International Center
No. 2660 Yongjiang Road, Ningbo Hi-Tech Zone
Ningbo, Zhejiang Province
People’s Republic of China
Telephone: +86 (574) 87175756

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

June 29, 2021

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ☐

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

1	NAMES OF REPORTING PERSONS Ace Lead Profits Limited
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP	(a) ☐ (b) ☒(1)
3	SEC USE ONLY
4	SOURCE OF FUNDS PF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(e) or 2(f)	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION British Virgin Islands

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER	4,144,223(1)
	8	SHARED VOTING POWER
	9	SOLE DISPOSITIVE POWER	4,144,223(1)
	10	SHARED DISPOSITIVE POWER

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,144,223 ordinary shares (1)
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 6.8%(2)
14	TYPE OF REPORTING PERSON CO

(1) Ace Lead Profits Limited (“Ace Lead”) is wholly owned and controlled by Mr. Baiqing Shao (“Mr. Shao”) and Mr. Shao may be deemed to be a beneficial owner of the shares of Hollysys Automation Technologies Ltd., a British Virgin Islands company (the “Issuer”), held by Ace Lead Profits Limited.

(2) Percentage calculated based on 61,275,099 ordinary shares issued and outstanding as of March 31, 2021 as reported on the Issuer’s Form 6K filed on May 13, 2021.

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1	NAMES OF REPORTING PERSONS Baiqing Shao
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP	(a) ☐ (b) ☒(1)
3	SEC USE ONLY
4	SOURCE OF FUNDS PF
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(e) or 2(f)	☐
6	CITIZENSHIP OR PLACE OF ORGANIZATION People’s Republic of China

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER	4,309,223(1)
	8	SHARED VOTING POWER
	9	SOLE DISPOSITIVE POWER	4,309,223(1)
	10	SHARED DISPOSITIVE POWER

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,309,223 ordinary shares (1)
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	☐
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 7.0%(2)
14	TYPE OF REPORTING PERSON IN

(1) Includes 4,144,223 ordinary shares held by Ace Lead and 165,000 ordinary shares held by Mr. Shao individually.

(2) Percentage calculated based on 61,275,099 ordinary shares issued and outstanding as of March 31, 2021 as reported on the Issuer’s Form 6K filed on May 13, 2021.

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Introductory Note

This Amendment No. 3 to Schedule 13D (this “Amendment No. 3”) amends and supplements the Schedule 13D filed with the United States Securities and Exchange Commission (the “SEC”) on September 26, 2016, as amended by Amendment No. 1 filed with the SEC on December 7, 2020 and Amendment No. 2 filed with the SEC on January 29, 2021 (the “Schedule 13D”), relating to the ordinary shares, par value $0.001 per share (“Ordinary Shares”) of the Issuer. Capitalized terms used herein without definition shall have the meaning set forth in the Schedule 13D.

The information set forth in response to each separate Item below shall be deemed to be a response to all Items where such information is relevant. The information set forth in the Exhibits attached hereto is expressly incorporated herein by reference and the response to each Item of this statement is qualified in its entirety by the provisions of such Exhibits.

Item 3. Source and Amount of Funds or Other Consideration.

Item 3 of the Schedule 13D is hereby amended, in pertinent part, by the following:

Based on the number of Ordinary Shares issued and outstanding as of March 31, 2021 as reported on the Issuer’s Form 6-K filed on May 13, 2021, the Reporting Persons anticipate that an aggregate amount of approximately US$974,116,479.6 will be expended in acquiring all of the outstanding Ordinary Shares not currently held by the Reporting Persons at US$17.10 per Ordinary Share in cash (the “Per Share Offer Price”).

Item 4. Purpose of Transaction.

Item 4 of the Schedule 13D is hereby amended and supplemented, in pertinent part, by the following:

On June 29, 2021, the Consortium issued a press release (the “Consent Solicitation Statement”) announcing the commencement of a solicitation of consents from shareholders of the Issuer to support the Consortium’s proposed acquisition of the Issuer at $17.10 per Ordinary Share (the “Transaction”). The Per Share Offer Price represents a premium of 37% to the closing price of the Issuer’s shares on December 4, 2020 (the last trading day preceding the date of the Consortium’s initial acquisition proposal), a premium of 48% to the 90-day volume-weighted average price as of December 4, 2020, and a premium of 21% to the closing price of $14.16 on June 25, 2021.

By this public solicitation, the Consortium asks the shareholders of the Issuer as of June 24, 2021 to sign and return a shareholder consent card (the “Shareholder Consent Card”) to consent to the following resolutions: (a) the Per Share Offer Price is acceptable to the shareholders of the Issuer; (b) the board of directors of the Issuer (“Board”) will expeditiously enter into discussion with the Consortium with a view to enter into a definitive merger agreement in a timely manner in respect of the Transaction at the Per Share Offer Price; (c) that certain amended and restated rights agreement (the “Rights Agreement”) dated as of September 24, 2020 by and between the Issuer and Continental Stock Transfer & Trust Company shall be unexercisable in respect of the Transaction and any other actions taken by the Consortium in connection with the Transaction, including a tender offer (the “Tender Offer”) and the commencement, announcement or consummation thereof (collectively, “Consortium Actions”); (d) the Issuer shall not issue, or agree to issue, any shares with special rights or at a discount to the current market value of the Ordinary Shares without the prior approval of a resolution of the Issuer’s shareholders; and (e) each director of the Issuer shall take all other actions necessary or desirable to give effect to the foregoing resolutions, including taking all actions (or refraining from taking any actions, as the case may be) necessary to render all rights under the Rights Agreement unexercisable in respect of the Transaction, the Tender Offer or any other Consortium Action.

If shareholders holding more than 50% of the votes in respect of the issued and outstanding shares of the Issuer consent to the aforementioned resolutions, these resolutions will become effective pursuant to the Issuer’s articles of association and the BVI Business Companies Act 2004. The intention of these resolutions is, among others, to limit the Board’s power to invoke and exercise rights pursuant to the Rights Agreement in respect of the Transaction. These approved resolutions, even after becoming effective, do not constitute an approval and authorization of the Transaction by shareholders. Shareholders of the Issuer will be entitled to consider and vote upon the Transaction at a special shareholder meeting to be called by the Board following the execution of a definitive merger agreement between the Consortium and the Issuer in respect of the Transaction. The Consortium urged shareholders to return signed Shareholder Consent Card as soon as possible before July 22, 2021. Such signed Shareholder Consent Card will remain revocable until the Consortium obtains consents from shareholders holding more than 50% of the votes in respect of the issued and outstanding shares of the Issuer.

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The Consortium has set up a dedicated website at Hollysyspublicsolicitation.net to provide instructions as to how shareholders may submit consents, along with other relevant background information. The Consortium urges all shareholders to read the Consent Solicitation Statement and the contents on the website carefully. The Consortium has engaged Innisfree M&A Incorporated (“Innisfree”) as its proxy solicitor to assist the Consortium to solicit consents from shareholders of the Issuer. Innisfree’s contact details can be found at the dedicated website.

In the event that Consortium cannot timely obtain sufficient shareholder consents, the Consortium may abandon the Transaction. Unless the Transaction can be executed and consummated quickly, the fundamentals of the Issuer may soon no longer justify a purchase price of US$17.10 per Ordinary Share.

The Consortium strongly believes that the Transaction will avail its shareholders of a direct path to realizing immediate liquidity and a highly compelling premium for their shares, with far greater certainty than if the Issuer were to remain a publicly traded company.

The foregoing descriptions of the Consent Solicitation Statement is not complete and are qualified in its entirety by the text of such documents, which is attached as exhibit hereto and incorporated herein by reference. The contents on the website Hollysyspublicsolicitation.net and the Shareholder Consent Card to be mailed to large beneficial-owned shareholders are also incorporated herein by reference.

The Transaction may result in one or more of the actions specified in clauses (a)−(j) of Item 4 of Schedule 13D, including without limitation the acquisition or disposition of additional securities of the Issuer, a merger or other extraordinary corporate transaction involving the Issuer, a change to the present Board, a change to the present capitalization or dividend policy of the Issuer, the delisting of the Issuer’s securities from the NASDAQ Global Select Market, and a class of equity securities of the Issuer becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934.

Item 5. Interest in Securities of the Issuer.

Item 5 of the Schedule 13D is hereby amended and restated in its entirety as follows:

(a) – (b) The following table sets forth the beneficial ownership of Ordinary Shares for each of the Reporting Persons.

Reporting Person	Amount beneficially owned:			Percent of class(1):			Sole power to vote or direct the vote:		Shared power to vote or to direct the vote:		Sole power to dispose or to direct the disposition of:		Shared power to dispose or to direct the disposition of:
Ace Lead		4,144,223			6.8	%		4,144,223		0		4,144,223		0
Mr. Shao		4,309,223	(2)		7.0	%		4,309,223		0		4,309,223		0

(1) Percentage calculated based on 61,275,099 ordinary shares issued and outstanding as of March 31, 2021 as reported on the Issuer’s Form 6-K filed on May 13, 2021.

(2) Includes 4,144,223 Ordinary Shares held by Ace Lead and 165,000 Ordinary Shares held by Mr. Shao individually.

(c) Except for the transactions as described in Item 4 above, the Reporting Persons did not effect any transactions in the Issuer’s securities within the past 60 days.

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(d) Other than the Reporting Persons and certain former and current employees of the Issuer and its subsidiaries (and related parties of such employees), no other person is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the Reporting Persons’ securities of the Issuer.

(e) Not applicable.

Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Item 6 of the Schedule 13D is hereby amended and restated in its entirety as follows:

The Joint Filing Agreement, the Consortium Agreement, the Original Proposal, the New Proposal and the Consent Solicitation Statement, which have been filed as Exhibit 7.1 to Exhibit 7.5 of the Schedule 13D, respectively, are incorporated herein by reference in their entirety. In addition, the information set forth in Items 3, 4 and 5 of this Amendment No. 3 is incorporated by reference in its entirety into this Item 6. To the best knowledge of the Reporting Persons, except as provided herein, there are no other contracts, arrangements, understandings or relationships (legal or otherwise) among the Reporting Persons and between any of the Reporting Persons and any other person with respect to any securities of the Issuer, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or loss, or the giving or withholding of proxies, or a pledge or contingency, the occurrence of which would give another person voting power over the securities of the Issuer.

Item 7. Material to be Filed as Exhibits.

Exhibit No.	Description
5.	Consent Solicitation Statement to the shareholders of Hollysys Automation Technologies Ltd. issued on June 29, 2021.

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SIGNATURES

After reasonable inquiry and to the best of his and its knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct.

Dated: June 29, 2021

Ace Lead Profits Limited
By:	/s/ Baiqing Shao
	Baiqing Shao
	Director
/s/ Baiqing Shao
Baiqing Shao

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EX-5

Exhibit 5

Buyer Consortium Commences a Solicitation of Consents from

Shareholders of Hollysys Automation Technologies to

Seek Support on Shareholder Resolutions Regarding its

$17.10 Per Share in Cash Acquisition Proposal

June 29, 2021 12:24 AM Eastern Daylight Time

BEIJING--(BUSINESS WIRE)--The buyer consortium (the “Consortium”) consisting of CPE Funds Management Limited, Mr. Shao Baiqing, and Ace Lead Profits Limited today commenced a solicitation of consents from shareholders of Hollysys Automation Technologies Ltd. (NASDAQ: HOLI) (the “Company” or “Hollysys”) regarding the Consortium’s proposed acquisition of the Company. The Consortium is mailing a letter to large beneficial-owner shareholders through their banks and brokers, along with a WHITE consent card. It is also posting instructions for how registered shareholders may submit consents on the dedicated website at Hollysyspublicsolicitation.net.

Hollysys shareholders as of June 24, 2021 are eligible to submit consents. Shareholders with questions about how to submit consents should promptly contact Innisfree M&A Incorporated, the firm assisting the Consortium with the consent solicitation, at +1 (877) 750-9501 (toll-free from the U.S. and Canada), or at +1 (412) 232-3651 (from other locations), during the hours of 10:00 a.m-7:00 p.m. Eastern Standard Time, Monday-Friday, and 10:00 a.m.-2:00 p.m. Eastern Standard Time on Saturdays. Shareholders may also seek assistance by email to Innisfree at HOLIconsent@innisfreema.com.

The full text of the Consortium’s letter being mailed to Hollysys shareholders is as follows:

Dear Fellow Shareholder, We, the buyer consortium (the “Consortium” or “we”) consisting of CPE Funds Management Limited, Mr. Shao Baiqing, and Ace Lead Profits Limited, are soliciting consents from shareholders of Hollysys Automation Technologies Ltd. (NASDAQ: HOLI) (the “Company” or “Hollysys”) to advance the proposed acquisition (the “Proposed Acquisition”) of all outstanding ordinary shares of the Company not already owned by the Consortium at a price of $17.10 per share in cash (“Per Share Offer Price”) pursuant to the revised binding proposal (the “Acquisition Proposal”) submitted by us on January 29, 2021. The Per Share Offer Price represents a premium of 37% to the closing price of the Company’s shares on December 4, 2020 (the last trading day preceding the date of the Consortium’s initial acquisition proposal), a premium of 48% to the 90-day volume-weighted average price as of December 4, 2020, and a premium of 21% to the closing price of $14.16 on June 25, 2021.

This solicitation, if successful, will facilitate the Consortium’s efforts to proceed with the Proposed Acquisition despite the inaction of the board of directors of the Company (the “Board”). If shareholders holding more than 50% of the outstanding shares of the Company deliver their consents to the resolutions as provided in the consent card, such resolutions will become effective pursuant to the Company’s articles of association and the BVI Business Companies Act 2004. The intention of these resolutions is, among others, to limit the Board’s power to invoke and exercise rights pursuant to the Company’s existing “poison pill” in respect of the Proposed Acquisition. These approved resolutions, even after becoming effective, do not constitute an approval and authorization of the Proposed Acquisition by shareholders. Shareholders of the Company will be entitled to consider and vote upon the Proposed Acquisition at a special shareholder meeting to be called by the Board following the execution of a definitive merger agreement between the Consortium and the Company in respect of the Proposed Acquisition.

We Urge Shareholders to Take Immediate Actions - Time is of the Essence

Please review the instructions provided under the “How to Consent” section on the dedicated website at Hollysyspublicsolicitation.net to see how you will receive the consent materials, including the WHITE consent card. Please then submit your consent by following the instructions on the enclosed WHITE consent card by signing, dating and returning the enclosed WHITE consent card in the postage-paid envelope provided.

Given the urgency of the situation, please submit your signed WHITE consent card to us as soon as possible before July 22, 2021. Your executed consent will remain revocable until we obtain consents from shareholders holding more than 50% of the outstanding shares of the Company.

As detailed on the consent card, we seek your consent with regard to the following resolutions:

1. the Per Share Offer Price is acceptable to the shareholders of the Company;

2. the Board shall expeditiously enter into discussion with the Consortium with a view to enter into a definitive merger agreement in a timely manner in respect of the Proposed Acquisition at the Per Share Offer Price;

3. the Rights Agreement shall be unexercisable in respect of the Proposed Acquisition, the Tender Offer (as defined in the shareholder consent document) and Consortium Actions (as defined in the shareholder consent document);

4. the Company shall not issue (or agree to issue) any shares with special rights or at a discount to the current market value of the ordinary shares of the Company without the prior approval of a resolution of the Company’s shareholders; and

5. each director of the Company shall take all other actions necessary or desirable to give effect to the foregoing resolutions, including taking all actions (or refraining from taking any actions, as the case may be) necessary to render all rights under the Rights Agreement unexercisable in respect of the Proposed Acquisition, the Tender Offer or Consortium Action.

Why We Need Shareholders’ Support

Five months have passed since the Consortium submitted the Acquisition Proposal on January 29, 2021, and yet the Board has not provided any updates on its review of the Acquisition Proposal. Neither did the Board ever engage with the Consortium to discuss the Acquisition Proposal despite our frequent public urging to the Board to do so and multiple warnings to the Board of it breaching its fiduciary duties for not acting on the Acquisition Proposal.

In the meantime, the Board and management are running the Company into the ground. The Company’s operational and financial conditions have been in a downward spiral since the abrupt removal of previous management without cause in July 2020. A close look at the financial results of operations for the nine-month period ended March 31, 2021 reveals significantly deteriorating financial and operational conditions of the Company. For example:

● Net operating cash flow has fallen from a positive $33.4 million as of December 31, 2020 to a negative $6.4 million as of March 31, 2021, a shocking $40 million drop in just one quarter.

● Net operation cash inflow dwindled from $117.5 million for the first three quarters of fiscal year 2020 to $48.6 million for the same period of fiscal year 2021, an almost 60% drop.

● Revenue and gross margin all decreased compared to pre-pandemic periods in 2019, while total operating expenses jumped 48% compared to 2019.

● Net income in the quarter and the nine-month period ended March 31, 2021 reduced significantly by 44% and 33%, respectively, compared to the same periods in 2019.

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While the Company is being badly mismanaged, the Company has issued an astonishing number of shares to its management and board members, presumably for nominal consideration, at an accelerating pace. Based on the information disclosed in the Company’s quarterly financials, the Company issued 318,000 new shares in the second fiscal quarter of 2021 (from October 1, 2020 to December 31, 2020), and another 420,000 new shares in the most recent third fiscal quarter of 2021 (from January 1, 2021 to March 31, 2021) – 738,000 new shares in two quarters. By contrast, the Company only issued a total of 195,000 new shares for whole fiscal year 2020 (from July 1, 2019 to June 30, 2020).

Shareholders may be wondering how the Board can just “sit on” the Acquisition Proposal for five months doing NOTHING, while misusing the Company’s money and resources to its heart’s content and why the Consortium cannot simply acquire control of the Company by purchasing shares from the open market or launching a

tender offer.

In fact, this is because the Company has strongly and egregiously entrenched itself against shareholders’ interests. The Company has an active “poison pill” that prohibits anyone from becoming a shareholder of 15% or more of the outstanding shares without the Board’s approval. The pill on its face would be triggered even by the Consortium’s commencement or announcement of a tender offer, whether or not the Consortium ultimately accepts the shares. Additionally, after we submitted our initial acquisition proposal in December 2020, on January 7, 2021 the Board hastily passed, without shareholder approval, highly objectionable amendments to the Company’s already extremely board-friendly charter.

As such, the Acquisition Proposal cannot proceed unless shareholders are able to deliver a strong mandate to the Board that it must take immediate action to enable the Acquisition Proposal to move forward.

How You Can Support the Acquisition Proposal

Please submit your consent by following the instructions on the enclosed WHITE consent card by signing, dating and returning the WHITE consent card in the postage-paid envelope provided. Given the urgency of the situation, please return your signed WHITE consent card to us as soon as possible before July 22, 2021.

What Happens if the Consortium Obtains Insufficient Shareholder Consents

Although the Consortium is committed to consummating the Proposed Acquisition, we may have to abandon it if we cannot timely obtain sufficient shareholder consents. The Company’s value is diminishing rapidly. Unless the Proposed Acquisition can be executed and consummated quickly, the fundamentals of the Company may soon no longer justify a purchase price of $17.10 per share.

By way of example, on December 21, 2020, J.P. Morgan’s analysts report provided forecast of the company’s stock price at $16.10 per share. J.P. Morgan subsequently lowered it to $15 per share in its analysts report issued on March 30, 2021 and maintained its $15 per share forecast in its analysts report issued on May 14, 2021. Relatedly the Company’s stock price has been performing poorly, far below $17.10.

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Conclusion

We strongly believe that the Proposed Acquisition will avail each shareholder of a direct path to realizing immediate liquidity and a highly compelling premium for their shares, with far greater certainty than if the Company were to remain a U.S. publicly traded company with a poor management team who neither know how to operate the business nor care about the Company or its shareholders, during a time of persisting uncertain economic and U.S. regulatory environment.

At this critical time, we ask all shareholders to please stand up for your best interests and make your voices heard. Please deliver a mandate to the Board that it cannot ignore by submitting your consent using the WHITE consent card as soon as possible and in any event before July 22, 2021, in support of our efforts to advance the Proposed Acquisition.

Thank you for your support,

Shao Baiqing

Ace Lead Profits Limited

CPE Funds Management Limited

Shareholders with questions about how to submit their consent may contact:

INNISFREE M&A INCORPORATED

+1 (877) 750-9501 (toll-free from the U.S. and Canada) or

+1 (412) 232-3651 (from other locations)

(10:00 a.m.-7:00 p.m. Eastern Standard Time, Monday-Friday, and 10:00 a.m.-2:00 p.m. Eastern Standard Time, on Saturdays)

Shareholders may also inquire by email at HOLIconsent@innisfreema.com.

Contacts

Jinxiang Guo

Executive Director

CPE Funds Management Limited

Email: guojinxiang@cpe-fund.com

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