CHM - Microsoft Compiled HTML
CHM files are basically a folder with HTML files with images and everything, which has been compressed and indexed, so Microsofts Help Viewer application can decompress only the bits you are browsing. This makes it unusable by other web browsers than Microsoft Internet Explorer for Windows, or specialized CHM viewer applications.
File Juicer includes Stuart Caie's libmspack. With this you can extract CHM files into the html, images and other files which can be found compressed inside.
CHM files come from the Microsoft tools: Microsofts Help tools page