The information in this preliminary prospectus is not complete and may be changed. The Selling StockholdersWe may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and the Selling Stockholders areit is not soliciting offersan offer to buy these securities in any statejurisdiction where the offer or sale of these securities is not permitted.
SUBJECT TO COMPLETION, DATED DECEMBER 27, 2019
AUGUST 6, 2020
PRELIMINARY PROSPECTUS
CHF SOLUTIONS, INC.
1,794,906 Shares
[ ] Units consisting of
Common Stock issuable upon exercise of WarrantsThis prospectus relates to the resale, from time to time, of (i) an aggregate of 575,830 shares of ourcommon stock and warrants (and shares of common stock underlying such warrants)
We are offering [ ] Units, with each Unit consisting of one share of common stock, par value $0.0001 per share, (the “Common Stock”) issuable upon exerciseand one warrant to purchase one share of our common stock (together with the shares of common stock purchaseunderlying such warrants, issued on October 25, 2019 (the “October the “Units”) at a public offering price of $[ ] per Unit. Warrants included in the Units have an exercise price of $[ ] per whole share (“Warrants”).
The Units will not be certificated and
(ii) an aggregate of 1,219,076the shares
of our Common Stock issuable upon exercise of common stock
purchaseand warrants
comprising the Units are immediately separable and will be issued
separately in this offering. The Warrants will be exercisable beginning on
November 6, 2019 (“November Warrants” together with the
October Warrants,effective date of our stockholders’ approval of either an increase in the
“Warrants”) by Bigger Capital Fund, LP (“Bigger Capital”), District 2 Capital Fund LP (“District 2”) and Hudson Bay Master Fund Ltd (“Hudson Bay,” and together with Bigger Capital and District 2, we collectively refernumber of our authorized shares of common stock or a reverse stock split, in either case, in an amount sufficient to
permit the
“Selling Stockholders”).We are not selling any securities under this prospectus and we will not receive proceeds from the sale of Common Stock by the Selling Stockholders. However, we may receive proceeds from the cash exercise in full of the Warrants, which, if exercised in cash atand will expire on the current applicable exercise price with respect to allfive year anniversary of the 1,794,906 sharesoriginal issuance date.
The price of
Common Stock, would resultour common stock on The Nasdaq Capital Market during recent periods will only be one of many factors in
gross proceedsdetermining the public offering price. Other factors to be considered in determining the public offering price include our history, our prospects, the industry in which we operate, our past and present operating results, the previous experience of
$2,023,925. We soldour executive officers, the
October Warrants to Bigger Capital and Hudson Bay under a purchase agreement (the “October Purchase Agreement”) dated October 23, 2019 for gross proceeds of approximately $660,000 on October 25, 2019. For a more detailed descriptiongeneral condition of the
October Warrants, see the section “Sale of Securities to Selling Stockholders”. Furthermore, we sold the November Warrants to the Selling Stockholders under a purchase agreement, dated November 4, 2019 (“November Purchase Agreement”). For a more detailed description of the November Warrants, see the section “Sale of Securities to Selling Stockholders”.We will pay the expenses of registering the shares of Common Stock offered by this prospectus, but all selling and other expenses incurred by each Selling Stockholder will be paid by such Selling Stockholder. The Selling Stockholders may sell the shares of our Common Stock offered by this prospectus from time to time on terms to be determinedsecurities markets at the time of sale through ordinary brokerage transactions or through any other means describedthis offering and discussions between the underwriters and prospective investors. The recent market price used throughout this prospectus may not be indicative of the final offering price. All unit, share, and warrant numbers included in this prospectus under “Planare based upon an assumed offering price and exercise price of Distribution.” The prices at which$ , the Selling Stockholders may sell shares will be determined by the prevailing marketclosing price for shares of our Common Stock or in negotiated transactions.
common stock on , 2020.
Our
Common Stockcommon stock trades on The Nasdaq Capital Market under the ticker symbol “CHFS”.
On December 18, 2019,See “Prospectus Summary—Recent Developments” in this prospectus for important information about the
last reported sale price per sharelisting of our
Common Stock was $0.724 per share. See “Description ofcommon stock on The Nasdaq Capital
Stock – Common Stock – Listing.”Market. We do not intend to list the Warrants to be sold in this offering on any stock exchange or other trading market.
Investing in our
Common Stockcommon stock involves a high degree of risk. Before making any investment in our
Common Stock,securities, you should read and carefully consider the risks described in this prospectus under the section of this prospectus entitled “Risk Factors”“Risk Factors” on page 57 of this prospectus.
Public offering price | | | | | | |
Underwriting discounts(2) | | | | | | |
Proceeds, before expenses, to CHF Solutions, Inc. | | | | | | |
(1)
| The public offering price and underwriting discount in respect of the Units corresponds to (i) a public offering price per share of common stock of $[ ] ($[ ] net of the underwriting discount) and (ii) a public offering price per warrant of $[ ] ($[ ] net of the underwriting discount). |
(2)
| We have agreed to pay certain expenses of the underwriters in this offering. We refer you to “Underwriting” on page 42 for additional information regarding underwriting compensation. |
Neither the Securities and Exchange Commission nor any state securities commission has approved or
disapproved of these securities or passed on the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.The underwriters have the option to purchase up to (i) [ ] additional shares of common stock, and/or (ii) additional warrants to purchase up to [ ] additional shares of common stock solely to cover over-allotments, if any, at the public offering price per share of common stock and the public offering price per warrant set forth above less the underwriting discounts and commissions. The over-allotment option may be used to purchase shares of common stock and/or warrants, or any combination thereof, as determined by the underwriters, but such purchases cannot exceed an aggregate of 15% of the number of shares of common stock and 15% of the Warrants sold in the primary offering. The over-allotment option is exercisable for 45 days from the date of this prospectus.
The underwriters expect to deliver the securities to purchasers on [ ], 2020.
Sole Book-Running Manager
Ladenburg Thalmann
Co-Manager
Maxim Group LLC
The date of this prospectus is
[ ��],
20 .2020
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You should rely only on the information contained in this prospectus orand any free-writing prospectus supplement or amendment thereto.that we authorize to be distributed to you. We have not, and the underwriters have not, authorized anyone to provide you with information different information.
from or in addition to that contained in this prospectus or any related free-writing prospectus. If anyone provides you with different or inconsistent information, you should not rely on it. We are offering to sell, and are seeking offers to buy, the securities offered by this prospectus only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the securities. Our business, financial conditions, results of operations and prospects may have changed since that date. You should also read and consider the information in the documents to which we have referred you under the caption “Where You Can Find Additional Information” in this prospectus.We have not, and the underwriter has not, done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to the offering of the securities and distribution of this prospectus outside the United States.
We obtained industry and market data used throughout and incorporated by reference into this prospectus through our research, surveys and studies conducted by third parties and industry and general publications. We have not independently verified market and industry data from third-party sources.
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ABOUT THIS PROSPECTUSThis prospectus relates to the resale by the Selling Stockholders of up to 1,794,906 shares of our Common Stock issuable upon exercise of the October Warrants and November Warrants, in each case as described below under “Sale of Securities to Selling Stockholders” and “Description of Capital Stock.” We are not selling any shares of Common Stock under this prospectus and will not receive any proceeds from the sale of shares of Common Stock by the Selling Stockholders.
This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (“SEC”). It omits some of the information contained in the registration statement and reference is made to the registration statement for further information with regard to us and the securities being offered
by the Selling Stockholders.hereby. You should review the information and exhibits in the registration statement for further information about us and the securities being offered hereby. Statements in this prospectus concerning any document we filed as an exhibit to the registration statement or that we otherwise filed with the SEC are not intended to be comprehensive and are qualified by reference to the filings. You should review the complete document to evaluate these statements.
You should read this prospectus, any documents that we incorporate by reference in this prospectus and the additional information described below under “Where You Can Find Additional Information” and “Information Incorporated By Reference” before making an investment decision. You should rely only on the information contained or incorporated by reference in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with additional, different or inconsistent information, you should not rely on it. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
You should not assume that the information in this prospectus or any documents we incorporate by reference herein is accurate as of any date other than the date on the front of such document. Our business, financial condition, results of operations and prospects may have changed since those dates.
WHERE YOU CAN FIND ADDITIONAL INFORMATION We file reports, proxy statements and other information with the SEC in accordance with the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our reports, proxy statements and other information filed with the SEC are available free of charge to the public over the Internet at the SEC’s website at
http://www.sec.gov. These documents may also be accessed on our website at
www.chf-solutions.com. Information contained in, or accessible through, our website is not a part of this prospectus.
INFORMATION INCORPORATED BY REFERENCE SEC rules allow us to “incorporate by reference” into this prospectus much of the information we file with the SEC, which means that we can disclose important information to you by referring you to those publicly available documents. The information that we incorporate by reference into this prospectus plus consolidated financial statements included in this prospectus is considered to be part of this prospectus. These documents may include Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as proxy statements. You should read the information incorporated by reference because it is an important part of this prospectus.
This prospectus incorporates by reference the documents listed below, other than those documents or the portions of those documents deemed to be furnished and not filed in accordance with SEC rules:
| • | our Quarterly ReportsReport on Form 10-Q for the quarter ended March 31, 2019,2020, filed with the SEC on May 9, 201914, 2020, and for the quarter ended June 30, 2019,2020, filed with the SEC on August 8, 2019, and for the quarter ended September 30, 2019, filed with the SEC on November 8, 20195, 2020; |
| • | our Current Reports on Form 8-K filed with the SEC on January 2, 2019, January 25, 201929, 2020, March 13, 201920, 2020, March 30, 2020, April 23, 2020, May 24, 20194, 2020, September 4, 2019May 12, 2020, September 27, 2019May 22, 2020, October 23, 2019June 19, 2020, November 4, 2019, December 6, 2019and December 20, 2019June 25, 2020; |
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| • | the information specifically incorporated by reference into our Annual Report on Form 10-K for the year ended December 31, 20182019 from our definitive proxy statement for the annual meeting of stockholders held on May 23, 2019,20, 2020, filed with the SEC on April 9, 201913, 2020;, and supplemented on May 22, 2020 and June 4, 2020 for the adjournment of the annual meeting of stockholders held on June 19, 2020; |
| • | the description of our common stock in our registration statement on Form 10 filed with the SEC on September 30, 2011, including any amendment or report filed for the purpose of updating such description; and |
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| • | the description of our Series A Junior Participating Preferred Stock, par value $0.0001 per share, in our registration statement on Form 8-A filed with the SEC on June 14, 2013. |
Any statement contained in any document incorporated by reference herein shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or any prospectus modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
We also incorporate by reference any future filings, other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed on such form that are related to such items, made with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, in each case, other than those documents or the portions of those documents deemed to be furnished and not filed in accordance with SEC rules, until the offering of the securities under the registration statement of which this prospectus forms a part is terminated or completed. Information in such future filings updates and supplements the information provided in this prospectus. Any statements in any such future filings will be deemed to modify and supersede any information in any document we previously filed with the SEC that is incorporated or deemed to be incorporated herein by reference to the extent that statements in the later filed document modify or replace such earlier statements.
Because we are incorporating by reference future filings with the SEC, this prospectus is continually updated and later information filed with the SEC may update and supersede some of the information included or incorporated by reference in this prospectus. This means that you must look at all of the SEC filings that we incorporate by reference to determine if any of the statements in this prospectus or in any document previously incorporated by reference have been modified or superseded.
These documents may also be accessed on our website at
www.chf-solutions.com. Information contained in, or accessible through, our website is not a part of this prospectus. We will provide without charge to each person, including any beneficial owners, to whom this prospectus is delivered, upon his or her written or oral request, a copy of any or all reports or documents referred to above which have been or may be incorporated by reference into this prospectus but not delivered with this prospectus, excluding exhibits to those reports or documents unless they are specifically incorporated by reference into those documents. You may request a copy of these documents by writing or telephoning us at the following address.
CHF Solutions, Inc.
12988 Valley View Road
Eden Prairie, Minnesota 55344
(952) 345-4200
ir@chf-solutions.comAttention: Claudia Drayton
Chief Financial Officer
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This summary highlights information contained elsewhere in this prospectus and does not contain all of the
information that you should consider in making your investment decision. Before deciding to invest in our securities, you should read this entire prospectus carefully, including our financial statements and related notes, the information in the section “Risk Factors” and our filings incorporated by reference herein to which we have referred you in the sections “Where You Can Find Additional Information” and “Information Incorporated by Reference.” Unless the context otherwise requires, references in this prospectus to the “Company,” “CHFS,” “we,the “registrant,” “we,” “us”, and “our” refer to CHF Solutions, Inc.We are a medical device company dedicated to changing the lives of patients suffering from fluid overload through science, collaboration, and innovative technology. The company is focused on developing, manufacturing, and commercializing
medical devices used in ultrafiltration therapy, including the Aquadex FlexFlow®
system for ultrafiltration therapy.and the Aquadex SmartFlow™ systems (collectively, the “Aquadex System”). The Aquadex
FlexFlow® systemSystem is indicated for temporary (up to eight hours)
ultrafiltration treatment of patients with fluid overload who have failed diuretic therapy andor extended (longer than 8
hours) ultrafiltration treatment ofhours in patients
withwho require hospitalization) use in adult and pediatric patients weighing 20kg or more whose fluid overload
who have failed diuretic therapy and require hospitalization.is unresponsive to medical management, including diuretics.
The Aquadex
FlexFlow System
The Aquadex
FlexFlow systemSystem is designed
and clinically proven to simply, safely, and precisely remove excess fluid (primarily excess salt and water) from patients suffering from fluid overload who have failed diuretic therapy. With the Aquadex
FlexFlow system,System, medical practitioners can specify and control the amount of fluid to be extracted at a safe, predictable, and effective
rate, in a process known as aquapheresis therapy.rate. The Aquadex
FlexFlow systemSystem has been shown to have no clinically significant impact on electrolyte balance, blood pressure or heart rate.
1(1) Unlike other forms of ultrafiltration, which typically require administration specifically by a nephrologist, the Aquadex
FlexFlow systemSystem may be prescribed by any physician and administered by a healthcare provider, both of whom have received training in extracorporeal therapies.
Benefits of the Aquadex
FlexFlow System
The Aquadex FlexFlow ultrafiltration systemSystem offers a safe approach to treating fluid overload and:
Provides complete control over rate and total volume of fluid removed by allowing a medical practitioner to specify the amount of fluid to be removed from each individual patient;
Aquapheresis therapy canCan be performed via peripheral or central venous access;
| • | Removes isotonic fluid (extracts sodium while sparing potassium and magnesium) 2(2); |
| • | Following ultrafiltration, neurohormonal activation is reset toward a more physiological condition and diuretic efficacy is restored 3(3); |
Provides highly automated operation with only one setting required to begin;
Utilizes a single-use, disposable auto-loading blood filter circuit that facilitates easy set-up;
The console guides medical practitioner through the setup and operational process; and
| • | Decreased hospital readmissions and duration 4(4) resulting in cost savings at 90 days 5(5). |
The Aquadex FlexFlow system consists of:
A console, a piece of capital equipment containing electromechanical pumps and an LCD screen;
| 2(2)
| Ali SS, et al. Congest Heart Fail. 2009; 15(1):1-4. |
| 3(3)
| Marenzi G, et al. J Am Coll Cardiol. 2001 Oct; 38(4): 963-968. |
| 4(4)
| Costanzo MR, et al. J Am Coll Cardiol. 2005 Dec 6; 46(11): 2047-2051. |
| 5(5)
| Costanzo MR, et al. Ultrafiltration vs. Diuretics for the Treatment of Fluid Overload in Patients with Heart Failure: A Hospital Cost Analysis. |