Document:

ex_174533.htm

EXHIBIT 10.01

 

GOODRICH PETROLEUM CORPORATION

2016 LONG TERM INCENTIVE PLAN

 

Grant of Shares

 

 

Grantee:

 

Grant Date:

 

 

	
			1.

				
			Grant of Shares. Goodrich Petroleum Corporation (the “Company”) hereby grants to you XXX Shares under the Goodrich Petroleum Corporation 2016 Long Term Incentive Plan (the “Plan”) on the terms and conditions set forth herein and in the Plan, which is incorporated herein by reference as a part of this Agreement. In the event of any conflict between the terms of this Agreement and the Plan, the Plan shall control. Capitalized terms used in this Agreement but not defined herein shall have the meanings ascribed to such terms in the Plan, unless the context requires otherwise. Upon vesting pursuant to Sections 2 or 3, you will be entitled to receive the vested amount of the Phantom Shares in shares of Common Stock of the Company.

			

 

	
			2.

				
			Regular Vesting. The Shares granted hereunder are comprised of (i) XXX performance-based Phantom Shares (the “Performance Vesting Phantom Shares”) which shall vest, or be forfeited, on XXX with a potential award ranging from no shares up to shares in accordance with the attached Performance-Based Payment Schedule (unless they vest prior to such date in accordance with Paragraph 3 below), and (ii) XXX Phantom Shares (the “Time Vesting Phantom Shares”) which shall vest on the anniversaries of XXX as follows:

			

 

	
			 

			Vesting Date

				
			Cumulative

			Vested Percentage

			
	
			1st Anniversary

				
			331⁄3%

			
	
			2nd Anniversary

				
			662⁄3%

			
	
			3rd Anniversary

				
			100%

			

 

Vesting with respect to a fractional share shall be rounded up to the next whole share. The Performance Vesting Phantom Shares and the Time Vesting Phantom Shares are referred to, collectively, in this Agreement as the “Phantom Awards.”

 

	
			3.

				
			Events Occurring Prior to Regular Vesting.

			

 

	 	
			(a)

				
			Death or Disability. If, prior to becoming fully vested in the Performance Vesting Phantom Shares or Time Vesting Phantom Shares hereby granted, you cease to be an employee of the Company as a result of your death or a disability that entitles you to benefits under the Company’s long-term disability plan, the Time Vesting Phantom Shares then held by you will automatically become fully vested upon such termination and the Performance Vesting Phantom Shares then held by you will automatically become vested at 100% of Target Payment (as such term is used in the attached Performance-Based Payment Schedule) upon such termination.

			

 

	 	
			(b)

				
			Other Terminations. If you terminate from the Company for any reason other than as provided in Paragraph 3(a), all unvested Phantom Awards then held by you automatically shall be forfeited without payment upon such termination.

			

 

	 	
			(c)

				
			Change of Control. All outstanding Phantom Awards held by you at the time of a Change of Control will automatically become fully vested upon the Change of Control. With respect to the Performance Vesting Phantom Shares described in Paragraph 2 above, the calculations under the Performance-Based Payment Schedule attached hereto shall be made at the time of such Change of Control if prior to December 10, 2022.

			

 

For purposes of this Agreement, your employment with a parent or Subsidiary of the Company shall be deemed to be employment with the Company.

 

	
			4.

				
			Stock Certificates. Upon vesting pursuant to Section 2 or Sections 3(a) or (c), the Company shall cause a stock certificate to be issued in your name for the shares of Common Stock that become vested. Settlement of Phantom Awards that vest pursuant to this Agreement will occur no later than 60 days following the applicable vesting event.

			

 

	
			5.

				
			Limitations Upon Transfer. The Phantom Awards and all other rights under this Agreement shall belong to you alone and may not be transferred, assigned, pledged, or hypothecated by you in any way (whether by operation of law or otherwise), other than by will or the laws of descent and distribution and shall not be subject to execution, attachment, or similar process. Upon any attempt by you to transfer, assign, pledge, hypothecate, or otherwise dispose of such rights contrary to the provisions in this Agreement or the Plan, or upon the levy of any attachment or similar process upon such rights, such rights shall immediately become null and void.

			

 

	
			6.

				
			Restrictions. By accepting this grant, you agree that any shares of Common Stock which you may acquire upon the vesting and payment of this award, if any, will not be sold or otherwise disposed of in any manner which would constitute a violation of any applicable federal or state securities laws, other applicable law or Company policies as determined by Company on advice of counsel chosen by the Company in its sole discretion. Notwithstanding any provision of this Agreement to the contrary, the issuance of Common Stock, if any, will be subject to compliance with all applicable requirements of federal, state, or foreign law with respect to such securities and with the requirements of any stock exchange or market system upon which the shares of Common Stock may then be listed. The Company may require you, as a condition of receiving the Common Stock, to give written assurances in substance and form satisfactory to the Company and its counsel to the effect that you are acquiring the Common Stock underlying the Phantom Awards for your own account for investment and not with any present intention of selling or otherwise distributing the same, and to such other effects as the Company deems necessary or appropriate to comply with federal and any applicable state and foreign securities laws. The Company intends to register the shares under the Plan on Form S-8 filed with the Securities and Exchange Commission. No shares will be issued hereunder if such issuance would constitute a violation of any applicable federal, state, or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the shares may then be listed. In addition, shares will not be issued hereunder unless (a) a registration statement under the Securities Act of 1933, as amended (the “Securities Act”) is at the time of issuance in effect with respect to the shares issued or (b) in the opinion of legal counsel to the Company, the shares issued may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance and sale of any shares subject to this Agreement will relieve the Company of any liability in respect of the failure to issue such shares as to which such requisite authority has not been obtained.

			

 

	
			7.

				
			Withholding of Tax. To the extent that the grant, vesting or settlement of Phantom Awards results in the receipt of compensation by you with respect to which the Company or an affiliate has a tax withholding obligation pursuant to applicable law, unless other arrangements have been made by you that are acceptable to the Company or such affiliate, you shall deliver to the Company or the affiliate such amount of money as the Company or the affiliate may require or determine to be advisable. No issuance of a share of stock shall be made pursuant to this Agreement until you have paid or made arrangements approved by the Company or the affiliate to satisfy in full the applicable tax withholding requirements of the Company or affiliate.

			

 

	
			8.

				
			Phantom Dividends. If during the period the Phantom Awards are held by you the Company pays a dividend on its Common Stock, you will be credited with additional Phantom Awards hereunder equal to the Fair Market Value of such dividends. Such additional Phantom Awards shall be subject to the same vesting provisions (including performance vesting provisions) and other provisions of this Agreement as if part of the tandem Phantom Award to which the phantom dividend relates and will be paid to you in Common Stock at the same time that the Phantom Awards associated with such phantom dividends are settled pursuant to this Agreement. For purposes of phantom dividends calculated on Performance Vesting Phantom Shares, such phantom dividends will be calculated on a number of Phantom Shares equal to 100% of the Target Payment (as such term is used in the attached Performance-Based Payment Schedule).

			

 

	
			9.

				
			Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, you agree, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, without limitation, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this and any other award made or offered by the Company. Electronic delivery may be via an electronic mail system of the Company or by reference to a location on a Company intranet to which you have access. You hereby consent to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and the Company agrees that your electronic signature is the same as, and shall have the same force and effect as, your manual signature.

			

 

	
			10.

				
			Binding Effect. This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and upon any person lawfully claiming under you.

			

 

	
			11.

				
			Entire Agreement. This Agreement constitutes the entire agreement of the parties with regard to the subject matter hereof, and contains all the covenants, promises, representations, warranties and agreements between the parties with respect to the Phantom Award granted hereby. Without limiting the scope of the preceding sentence, all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect. Any modification of this Agreement shall be effective only if it is in writing and signed by both you and an authorized officer of the Company.

			

 

	
			12.

				
			Independent Legal and Tax Advice. You have been advised, and you hereby acknowledge that you have been advised, to obtain independent legal and tax advice regarding this grant of a Phantom Award and the issues of Common Stock and eventual disposition of such Common Stock. The Board and the Company do not guarantee Common Stock potentially issued in connection herewith from loss or depreciation. 

			

 

	
			13.

				
			Governing Law. This grant shall be governed by, and construed in accordance with, the laws of the State of Texas, without regard to conflicts of laws principles thereof.

			

 

 

 

Please return this Agreement signed to the Company. The enclosed copy is for your records.

 

 

 

Agreed and accepted     Goodrich Petroleum Corporation

by Grantee

 

________________________     By: Leslee M. Ranly

          Name: Leslee M. Ranly                              Title: VP-Human Resources and AdministrationExhibit 4.16

    

    

    CHF Solutions, Inc.

    

    

    Description of Securities

    

    

    General

    

    

    CHF Solutions, Inc. is incorporated in the State of Delaware.  The following description summarizes the most important terms of our capital stock. This description is not complete, and we qualify it by referring to our certificate of
      incorporation, bylaws and certificate of designation of preferences, rights and limitations of Series F Preferred Stock and Series H Preferred Stock, copies of which have been incorporated by reference as exhibits to the Annual Report on Form 10-K of
      which this exhibit is a part, and to the applicable provisions of the Delaware General Corporation Law.

    

    

    Common Stock

    

    

    Dividends

    

    

    Holders of our common stock are entitled to receive dividends when and as declared by our board of directors out of funds legally available.

    

    

    Voting

    

    

    Holders of our common stock are entitled to one vote for each share on each matter properly submitted to our stockholders for their vote; provided however, that except as otherwise required by law, holders of our common stock will not be entitled
      to vote on any amendment to our certificate of incorporation (including any certificate of designation filed with respect to any series of preferred stock) that relates solely to the terms of a series of outstanding preferred stock if the holders of
      such affected series are entitled, either separately or together as a class with the holders of one or more other such series, to vote thereon by law or pursuant to our certificate of incorporation (including any certificate of designation filed with
      respect to any series of preferred stock).

    

    

    Subject to the voting restrictions described above, holders of our common stock may adopt, amend or repeal our bylaws and/or alter certain provisions of our certificate of incorporation with the affirmative vote of the holders of at least 66 2 ∕ 3 % of the voting power of all of the then-outstanding shares of our capital stock entitled to vote generally in the election of directors, voting together as a single
      class, in addition to any vote of the holders of a class or series of our stock required by law or our certificate of incorporation. Those provisions of our certificate of incorporation that may be altered only by the super-majority vote described
      above relate to:

    

    

    	 	
            •

          	
            the number of directors on our board of directors, the classification of our board of directors and the terms of the members of our board of directors;

          

    

    

    	 	
            •

          	
            the limitations on removal of any of our directors described below under “—Anti-Takeover Effects of Certain Provisions of Our Certificate of Incorporation and Bylaws and Delaware Law;”

          

    

    

    	 	
            •

          	
            the ability of our directors to fill any vacancy on our board of directors by the affirmative vote of a majority of the directors then in office under certain circumstances;

          

    

    

    	 	
            •

          	
            the ability of our board of directors to adopt, amend or repeal our bylaws and the super-majority vote of our stockholders required to adopt, amend or repeal our bylaws described above;

          

    

    

    	 	
            •

          	
            the limitation on action of our stockholders by written action described below under “—Anti-Takeover Effects of Certain Provisions of Our Certificate of Incorporation and Bylaws and Delaware Law;”

          

    
      
        

    

    	 	
            •

          	
            the choice of forum provision described below under “—Choice of Forum;”

          

    

    

    	 	
            •

          	
            the limitations on director liability and indemnification described below under the heading “—Limitation on Liability of Directors and Indemnification;” and

          

    

    

    	 	
            •

          	
            the super-majority voting requirement to amend our certificate of incorporation described above.

          

    

    

    Conversion, Redemption and Preemptive Rights

    

    

    Holders of our common stock do not have any conversion, redemption or preemptive rights pursuant to our organizational documents.

    

    

    Liquidation, Dissolution and Winding-up

    

    

    In the event of our liquidation, dissolution or winding up, holders of our common stock are entitled to share ratably in any assets remaining after the satisfaction in full of the prior rights of creditors and the aggregate of any liquidation
      preference pursuant to the terms of any certificate of designation filed with respect to any series of preferred stock, including our outstanding Series F Preferred Stock and Series H Preferred Stock.

    

    

    Preferred Stock

    

    

    We may issue any class of preferred stock in any series. Our board of directors has the authority to establish and designate series, and to fix the number of shares included in each such series and to determine or alter for each such series, such
      voting powers, designation, preferences, and relative participating, optional, or other rights and such qualifications, limitations or restrictions thereof. Our board of directors is not restricted in repurchasing or redeeming such stock while there
      is any arrearage in the payment of dividends or sinking fund installments. Our board of directors is authorized to increase or decrease the number of shares of any series subsequent to the issuance of shares of that series, but not below the number
      of shares of such series then outstanding. The number of authorized shares of preferred stock may be increased or decreased, but not below the number of shares thereof then outstanding, by the affirmative vote of the holders of a majority of the
      common stock, without a vote of the holders of the preferred stock, or of any series thereof, unless a vote of any such holders is required pursuant to the terms of any certificate of designation filed with respect to any series of preferred stock.

    

    

    Prior to issuance of shares of any series of preferred stock, our board of directors is required by Delaware law to adopt resolutions and file a certificate of designation with the Secretary of State of the State of Delaware. The certificate of
      designation fixes for each class or series the terms, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption for each class or
      series. Any shares of preferred stock will, when issued, be fully paid and non-assessable.

    

    

    Series F Convertible Preferred Stock.

    

    

    Our board of directors designated 18,000 shares of preferred stock as Series F convertible preferred stock, $0.0001 par value (“Series F Preferred Stock”).

    

    

    Liquidation. Upon any dissolution, liquidation or winding up, whether voluntary or involuntary, holders of Series F Preferred Stock will be entitled to receive distributions out of our assets, whether
      capital or surplus, of an amount equal to $0.0001 per share of Series F Preferred Stock before any distributions shall be made on the common stock or any series of preferred stock ranked junior to the Series F Preferred Stock.

    
      
        

    

    Dividends. Holders of the Series F Preferred Stock are entitled to receive dividends equal (on an “as converted to common stock” basis) to and in the same form as dividends actually paid on shares of our
      common stock when, as and if such dividends are paid on shares of our common stock. No other dividends will be paid on shares of Series F Preferred Stock.

    

    

    Conversion. Each share of Series F Preferred Stock is convertible, at any time and from time to time at the option of the holder thereof, into that number of shares of common stock determined by dividing
      $1,000 by the conversion price of $0.55 (subject to adjustment described below). This right to convert is limited by the beneficial ownership limitation described below.

    

    

    Forced Conversion. Subject to certain ownership limitations as described below and certain equity conditions being met, until such time that during any 20 of 30 consecutive trading days, the volume weighted
      average price of our common stock exceeds 300% of the conversion price and the daily dollar trading volume during such period exceeds $200,000 per trading day, we have the right to force the conversion of the Series F Preferred Stock into common
      stock.

    

    

    Beneficial Ownership Limitation. A holder shall have no right to convert any portion of Series F Preferred Stock, to the extent that, after giving effect to such conversion, such holder, together with such
      holder’s affiliates, and any persons acting as a group together with such holder or any such affiliate, would beneficially own in excess of 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of
      shares of common stock upon such conversion (subject to the right of the holder to increase such beneficial ownership limitation upon not less than 61 days prior notice provided that such limitation can never exceed 9.99% and such 61 day period
      cannot be waived). Beneficial ownership of the holder and its affiliates will be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. Holders of Series F
      Preferred Stock who are subject to such beneficial ownership limitation are and will remain responsible for ensuring their own compliance with Regulation 13D-G promulgated under the Securities Exchange Act of 1934, as amended, consistent with their
      individual facts and circumstances. In addition, pursuant to Rule 13d-3(d)(1) (i) promulgated under the Securities Exchange Act of 1934, as amended, any person who acquires Series F Preferred Stock with the purpose or effect of changing or
      influencing the control of our company, or in connection with or as a participant in any transaction having such purpose or effect, immediately upon such acquisition will be deemed to be the beneficial owner of the underlying common stock.

    

    

    Optional Redemption. Subject to the terms of the certificate of designation, the Company holds an option to redeem some or all the Series F Preferred Stock six months after its issuance date at a 200%
      premium to the stated value of the Series F Preferred Stock subject to the redemption, upon 30 days prior written notice to the holder of the Series F Preferred Stock. The Series F Preferred Stock would be redeemed by the Company for cash.

    

    

    Conversion Price Adjustment

    

    

    Subsequent Equity Sales. The Series F Preferred Stock has full ratchet price based anti-dilution protection, subject to customary carve outs, in the event of a down-round financing at a price per share
      below the conversion price of the Series F Preferred Stock. If during any 20 of 30 consecutive trading days the volume weighted average price of our common stock exceeds 300% of the then-effective conversion price of the Series F Preferred Stock and
      the daily dollar trading volume for each trading day during such period exceeds $200,000, the anti-dilution protection in the Series F Preferred Stock will expire and cease to apply.

    

    

    Stock Dividends and Stock Splits. If we pay a stock dividend or otherwise make a distribution payable in shares of common stock on shares of common stock or any other common stock equivalents, subdivide or
      combine outstanding common stock, or reclassify common stock, the conversion price will be adjusted by multiplying the then conversion price by a fraction, the numerator of which shall be the number of shares of common stock outstanding immediately
      before such event, and the denominator of which shall be the number of shares outstanding immediately after such event.

    
      
        

    

    Fundamental Transaction. If we effect a fundamental transaction in which we are the surviving entity, then upon any subsequent conversion of Series F Preferred Stock, the holder thereof shall have the right
      to receive, for each share of common stock that would have been issuable upon such conversion immediately prior to the occurrence of such fundamental transaction, the number of shares of our common stock and any additional consideration receivable as
      a result of such fundamental transaction by a holder of the number of shares of common stock into which Series F Preferred Stock is convertible immediately prior to such fundamental transaction. If we effect a fundamental transaction in which we are
      not the surviving entity or a reverse merger in which we are the surviving entity, then the surviving entity shall purchase the outstanding Series F Preferred Stock by paying and issuing, in the event that such consideration given to common
      stockholders is non-cash consideration, as the case may be, to such holder (or canceling such holder’s outstanding Series F Preferred Stock and converting it into the right to receive) an amount equal to the greater of (i) the cash consideration plus
      the non-cash consideration (in the form issuable to the holders of common stock) per share of the common stock in the fundamental transaction multiplied by the number of conversion shares underlying the shares of Series F Preferred Stock held by the
      holder on the date of the consummation of the fundamental transaction or (ii) 130% of the stated value of the Series F Preferred Stock then outstanding on the date immediately prior to the consummation of the fundamental transaction. Such amount
      shall be paid in the same form and mix (be it securities, cash or property, or any combination of the foregoing) as the consideration received by the common stock in such fundamental transaction. A fundamental transaction means: (i) our merger or
      consolidation with or into another entity, (ii) any sale or other disposition of all or substantially all of our assets in one transaction or a series of related transactions, (iii) any tender offer or exchange offer allowing holders of our common
      stock to tender or exchange their shares for cash, property or securities, and has been accepted by the holders of 50% or more of the outstanding common stock (iv) any reclassification of our common stock or any compulsory share exchange by which
      common stock is effectively converted into or exchanged for other securities, cash or property, or (v) consummation of a stock or share purchase agreement or other business combination with another person whereby such other person acquires more than
      50% of the outstanding shares of common stock.

    

    

    Voting Rights, etc. Except as otherwise provided in the Series F Preferred Stock certificate of designation or required by law, the Series F Preferred Stock has no voting rights. However, as long as any
      shares of Series F Preferred Stock are outstanding, we may not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series F Preferred Stock, alter or change adversely the powers, preferences or rights
      given to the Series F Preferred Stock, amend its certificate of designation, amend our certificate of incorporation or other charter documents in any manner that adversely affects any rights of the holders, increase the number of authorized shares of
      Series F Preferred Stock, or enter into any agreement with respect to any of the foregoing. The Series F Preferred Stock certificate of designation provides that if any party commences an action or proceeding to enforce any provisions of the
      certificate of designation, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action
      or proceeding. This provision may, under certain circumstances, be inconsistent with federal securities laws and Delaware general corporation law.

    

    

    Fractional Shares. No fractional shares of common stock will be issued upon conversion of Series F Preferred Stock. Rather, we shall, at our election, either pay a cash adjustment in respect of such final
      fraction in an amount equal to such fraction multiplied by the conversion price or round up to the next whole share.

    

    

    The Series F Preferred Stock was issued in book-entry form under a preferred stock agent agreement between American Stock Transfer & Trust as preferred stock agent, and us, and shall initially be represented by one or more book-entry
      certificates deposited with The Depository Trust Company, or DTC, and registered in the name of Cede & Co., a nominee of DTC, or as otherwise directed by DTC. There is no established public trading market for the Series F Preferred Stock, and the
      Series F Preferred Stock is not listed on The Nasdaq Capital Market, any other national securities exchange or any other nationally recognized trading system.

    
      
        

    

    Series H Convertible Preferred Stock

    

    

    Our board of directors has designated 11,517,269 shares of preferred stock as Series H convertible preferred stock, $0.0001 par value (“Series H Preferred Stock”).

    

    

    Liquidation. Upon any dissolution, liquidation or winding up, whether voluntary or involuntary, holders of Series H Preferred Stock will be entitled to receive distributions out of our assets, whether
      capital or surplus, of an amount equal to $0.0001 per share of Series H Preferred Stock before any distributions shall be made on the common stock or any series of preferred stock ranked junior to the Series H Preferred Stock, but after distributions
      shall be made on any outstanding Series F Preferred Stock and any of our existing or future indebtedness.

    

    

    Dividends. Holders of the Series H Preferred Stock will be entitled to receive dividends equal (on an “as converted to common stock” basis) to and in the same form as dividends actually paid on shares of
      our common stock when, as and if such dividends are paid on shares of our common stock. No other dividends will be paid on shares of Series H Preferred Stock.

    

    

    Conversion. Each share of Series H Preferred Stock is convertible, at any time and from time to time at the option of the holder thereof, into one share of common stock (subject to adjustment described
      below). This right to convert is limited by the beneficial ownership limitation described below.

    

    

    Forced Conversion. Subject to certain ownership limitations as described below and certain equity conditions being met, until such time that during any 20 of 30 consecutive trading days, the volume weighted
      average price of our common stock exceeds 300% of the conversion price and the daily dollar trading volume during such period exceeds $200,000 per trading day, we shall have the right to force the conversion of the Series H Preferred Stock into
      common stock.

    

    

    Beneficial Ownership Limitation. A holder shall have no right to convert any portion of Series H Preferred Stock, to the extent that, after giving effect to such conversion, such holder, together with such
      holder’s affiliates, and any persons acting as a group together with such holder or any such affiliate, would beneficially own in excess of 4.99% (or, upon the election by a holder prior to the issuance of any shares of Series H Preferred Stock,
      9.99%) of the number of shares of common stock outstanding immediately after giving effect to the issuance of shares of common stock upon such conversion (subject to the right of the holder to increase such beneficial ownership limitation upon not
      less than 61 days prior notice provided that such limitation can never exceed 9.99% and such 61 day period cannot be waived). Beneficial ownership of the holder and its affiliates will be determined in accordance with Section 13(d) of the Securities
      Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. Holders of Series H Preferred Stock who are subject to such beneficial ownership limitation are and will remain responsible for ensuring their own compliance with
      Regulation 13D-G promulgated under the Securities Exchange Act of 1934, as amended, consistent with their individual facts and circumstances. In addition, pursuant to Rule 13d-3(d)(1)(i) promulgated under the Securities Exchange Act of 1934, as
      amended, any person who acquires Series H Preferred Stock with the purpose or effect of changing or influencing the control of our company, or in connection with or as a participant in any transaction having such purpose or effect, immediately upon
      such acquisition will be deemed to be the beneficial owner of the underlying common stock.

    

    

    Conversion Price Adjustment

    

    

    Stock Dividends and Stock Splits. If we pay a stock dividend or otherwise make a distribution payable in shares of common stock on shares of common stock or any other common stock equivalents, subdivide or
      combine outstanding common stock, or reclassify common stock, the conversion price will be adjusted by multiplying the then conversion price by a fraction, the numerator of which shall be the number of shares of common stock outstanding immediately
      before such event, and the denominator of which shall be the number of shares outstanding immediately after such event.

    
      
        

    

    Fundamental Transaction. If we effect a fundamental transaction in which we are the surviving entity, then upon any subsequent conversion of Series H Preferred Stock, the holder thereof shall have the right
      to receive, for each share of common stock that would have been issuable upon such conversion immediately prior to the occurrence of such fundamental transaction, the number of shares of our common stock and any additional consideration receivable as
      a result of such fundamental transaction by a holder of the number of shares of common stock into which Series H Preferred Stock is convertible immediately prior to such fundamental transaction. A fundamental transaction means: (i) our merger or
      consolidation with or into another entity, (ii) any sale or other disposition of all or substantially all of our assets in one transaction or a series of related transactions, (iii) any tender offer or exchange offer allowing holders of our common
      stock to tender or exchange their shares for cash, property or securities, and has been accepted by the holders of 50% or more of the outstanding common stock (iv) any reclassification of our common stock or any compulsory share exchange by which
      common stock is effectively converted into or exchanged for other securities, cash or property, or (v) consummation of a stock or share purchase agreement or other business combination with another person whereby such other person acquires more than
      50% of the outstanding shares of common stock.

    

    

    Voting Rights, etc. Except as otherwise provided in the Series H Preferred Stock certificate of designation or required by law, the Series H Preferred Stock has no voting rights. However, as long as any
      shares of Series H Preferred Stock are outstanding, we may not, without the affirmative vote of the holders of a majority of the then outstanding shares of the Series H Preferred Stock, alter or change adversely the powers, preferences or rights
      given to the Series H Preferred Stock, amend its certificate of designation, amend our certificate of incorporation or other charter documents in any manner that adversely affects any rights of the holders, increase the number of authorized shares of
      Series H Preferred Stock, or enter into any agreement with respect to any of the foregoing. The Series H Preferred Stock certificate of designation provides that if any party commences an action or proceeding to enforce any provisions of the
      certificate of designation, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its attorneys’ fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action
      or proceeding. This provision may, under certain circumstances, be inconsistent with federal securities laws and Delaware general corporation law.

    

    

    Fractional Shares. No fractional shares of common stock will be issued upon conversion of Series H Preferred Stock. Rather, we shall, at our election, either pay a cash adjustment in respect of such final
      fraction in an amount equal to such fraction multiplied by the conversion price or round up to the next whole share.

    

    

    The Series H Preferred Stock was issued in book-entry form under a preferred stock agent agreement between American Stock Transfer & Trust as preferred stock agent, and us, and shall initially be represented by one or more book-entry
      certificates deposited with The Depository Trust Company, or DTC, and registered in the name of Cede & Co., a nominee of DTC, or as otherwise directed by DTC. There is no established public trading market for the Series H Preferred Stock, and the
      Series H Preferred Stock is not listed on The Nasdaq Capital Market, any other national securities exchange or any other nationally recognized trading system.

    

    

    Description of Outstanding Warrants

    

    

    As of February 28, 2020, there were warrants outstanding to purchase a total of 24,512,102 shares of our common stock, which expire between 2020 and 2025. Each of these warrants entitles the holder to purchase one share of common stock at prices
      ranging from $0.55 to $43,848 per common share, with a weighted average exercise price of $2.40 per share. Certain of these warrants have a net exercise provision under which its holder may, in lieu of payment of the exercise price in cash, surrender
      the warrant and receive a net amount of shares based on the fair market value of our common stock at the time of exercise of the warrant after deduction of the aggregate exercise price. Each of these warrants also contains provisions for the
      adjustment of the exercise price and the aggregate number of shares issuable upon the exercise of the warrant in the event of dividends, share splits, reorganizations and reclassifications and consolidations. Certain of these warrants provide that,
      subject to limited exceptions, a holder will not have the right to exercise any portion of its warrants if the holder, together with its affiliates, would beneficially own over 4.99% of our then outstanding common stock following such exercise;
      provided, however, that upon prior notice to us, the warrant holder may increase its ownership, provided that in no event will the ownership exceed 9.99%.

    
      
        

    

    Anti-Takeover Effects of Certain Provisions of Our Certificate of Incorporation and Bylaws and Delaware Law

    

    

    Certificate of Incorporation and Bylaws

    

    

    Certain provisions of our certificate of incorporation and bylaws may be considered to have an anti-takeover effect, such as those provisions:

    	 	
            •

          	
            providing for our board of directors to be divided into three classes with staggered three-year terms, with only one class of directors being elected at each annual meeting of our stockholders and the other classes continuing for the
              remainder of their respective three-year terms;

          

    

    

    	 	
            •

          	
            authorizing our board of directors to issue from time to time any series of preferred stock and fix the voting powers, designation, powers, preferences and rights of the shares of such series of preferred stock;

          

    

    

    	 	
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            prohibiting stockholders from acting by written consent in lieu of a meeting;

          

    

    

    	 	
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            requiring advance notice of stockholder intention to put forth director nominees or bring up other business at a stockholders’ meeting;

          

    

    

    	 	
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            prohibiting stockholders from calling a special meeting of stockholders;

          

    

    

    	 	
            •

          	
            requiring a 662∕3% super-majority stockholder approval in order for stockholders to alter, amend or repeal certain provisions of our certificate of
              incorporation;

          

    

    

    	 	
            •

          	
            requiring a 662∕3% super-majority stockholder approval in order for stockholders to adopt, amend or repeal our bylaws;

          

    

    

    	 	
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            providing that, subject to the rights of the holders of any series of preferred stock to elect additional directors under specified circumstances, neither the board of directors nor any individual director may be removed without cause;

          

    

    

    	 	
            •

          	
            creating the possibility that our board of directors could prevent a coercive takeover of our Company due to the significant amount of authorized, but unissued shares of our common stock and preferred stock;

          

    

    

    	 	
            •

          	
            providing that, subject to the rights of the holders of any series of preferred stock, the number of directors shall be fixed from time to time exclusively by our board of directors pursuant to a resolution adopted by a majority of the
              total number of authorized directors; and

          

    

    

    	 	
            •

          	
            providing that any vacancies on our board of directors under certain circumstances will be filled only by a majority of our board of directors then in office, even if less than a quorum, and not by the stockholders.

          

    

    

    Delaware Law

    

    

    We are also subject to Section 203 of the DGCL, which generally prohibits a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years following the date that the stockholder became
      an interested stockholder, unless:

    

    

    	 	
            •

          	
            prior to that date, our board of directors approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder;

          

    

    

    
      
        

    

    	 	
            •

          	
            upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of our voting stock outstanding at the time the transaction commenced, excluding for
              purposes of determining the number of shares outstanding (but not the outstanding voting stock owned by the interested stockholder) those shares owned by (i) persons who are directors and also officers and (ii) employee stock plans in which
              employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

          

    

    

    	 	
            •

          	
            on or subsequent to that date, the business combination is approved by our board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2 ∕ 3 % of the outstanding voting stock that is not owned by the interested stockholder.

          

    

    

    In general, Section 203 of the DGCL defines an interested stockholder as an entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled
      by any of these entities or persons.

    

    

    The above-summarized provisions of our certificate of incorporation and bylaws and the above-summarized provisions of the DGCL could make it more difficult to acquire us by means of a tender offer, a proxy contest or otherwise, or to remove
      incumbent officers and directors. These provisions are expected to discourage certain types of coercive takeover practices and takeover bids that our board of directors may consider inadequate and to encourage persons seeking to acquire control of us
      to first negotiate with our board of directors. We believe that the benefits of increased protection of our ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh the disadvantages of
      discouraging takeover or acquisition proposals because, among other things, negotiation of these proposals could result in an improvement of their terms.

    

    

    Choice of Forum

    

    

    Our Fourth Amended and Restated Certificate of Incorporation, as amended, provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the exclusive forum for any
      derivative action or proceeding brought on our behalf; any action asserting a breach of fiduciary duty; any action asserting a claim against us arising pursuant to the Delaware General Corporation Law; or any action asserting a claim against us that
      is governed by the internal affairs doctrine. These provisions would not apply to suits brought to enforce a duty or liability created by the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts have exclusive
      jurisdiction. Our Fourth Amended and Restated Certificate of Incorporation, as amended, will further provide that the federal district courts of the United States of America will be the exclusive forum for resolving any complaint asserting a cause of
      action arising under the Securities Act, subject to applicable law. Any person or entity purchasing or otherwise acquiring any interest in our securities shall be deemed to have notice of and consented to these provisions. Our exclusive forum
      provision will not relieve us of our duties to comply with the federal securities laws and the rules and regulations thereunder, and our stockholders will not be deemed to have waived our compliance with these laws, rules and regulations.

    

    

    The provisions of the Delaware General Corporation Law, our Fourth Amended and Restated Certificate of Incorporation, as amended, and our Second Amended and Restated Bylaws could have the effect of discouraging others from attempting hostile
      takeovers and, as a consequence, they may also inhibit temporary fluctuations in the price of our common stock that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in our
      management. It is possible that these provisions could make it more difficult to accomplish transactions that stockholders may otherwise deem to be in their best interests.

    
      
        

    

    Limitation on Liability of Directors and Indemnification

    

    

    Our certificate of incorporation limits the liability of our directors to the fullest extent permitted by Delaware law. Delaware law provides that directors of a corporation will not be personally liable for monetary damages for breach of their
      fiduciary duties as directors, except for liability for any:

    

    

    	 	
            •

          	
            breach of their duty of loyalty to us or our stockholders;

          

    

    

    	 	
            •

          	
            act or omission not in good faith or that involves intentional misconduct or a knowing violation of law;

          

    

    

    	 	
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            unlawful payment of dividends or redemption of shares as provided in Section 174 of the DGCL; or

          

    

    

    	 	
            •

          	
            transaction from which the directors derived an improper personal benefit.

          

    

    

    These limitations of liability do not apply to liabilities arising under federal securities laws and do not affect the availability of equitable remedies such as injunctive relief or rescission.

    

    

    Our bylaws provide that we will indemnify and advance expenses to our directors and officers to the fullest extent permitted by law or, if applicable, pursuant to indemnification agreements. They further provide that we may choose to indemnify our
      other employees or agents from time to time. Subject to certain exceptions and procedures, our bylaws also require us to advance to any person who was or is a party, or is threatened to be made a party, to any proceeding by reason of the person’s
      service as one of our directors or officers all expenses incurred by the person in connection with such proceeding.

    

    

    Section 145(g) of the DGCL and our bylaws also permit us to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in connection with their services to us, regardless of
      whether our bylaws permit indemnification. We maintain a directors’ and officers’ liability insurance policy.

    

    

    We entered into indemnification agreements with each of our directors and executive officers that provide, in general, that we will indemnify them to the fullest extent permitted by law in connection with their service to us or on our behalf and,
      subject to certain exceptions and procedures, that we will advance to them all expenses that they incur in connection with any proceeding to which they are, or are threatened to be made, a party.

    

    

    At present, there is no pending litigation or proceeding involving any of our directors or officers as to which indemnification is required or permitted, and we are not aware of any threatened litigation or proceeding that may result in a claim
      for indemnification.

    

    

    Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the
      opinion of the SEC this indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

    

    

    Transfer Agent and Registrar

    

    

    The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company LLC.

    

    

    Listing

    

    

    Our common stock trades on The Nasdaq Capital Market under the symbol “CHFS.”

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