RESEARCH TRIANGLE
PARK, N.C., May 15, 2024 /PRNewswire/ -- Charles
& Colvard, Ltd. (Nasdaq: CTHR) (the "Company"), a globally
recognized fine jewelry company that specializes in moissanite and
lab grown diamonds, announced today that the Company's Board of
Directors has approved a one-for-ten (1:10) reverse split of the
Company's common stock, no par value per share (the "Reverse Stock
Split"), to be effective as of 12:01 a.m.
Eastern Time on May 17, 2024
(the "Effective Date"). The Reverse Stock Split is intended to
bring the Company into compliance with Nasdaq's $1.00 per share minimum bid price requirement for
continued listing. The Company expects its common stock to begin
trading on a split-adjusted basis on the Nasdaq Capital Market as
of the commencement of trading on May 17,
2024 with a new CUSIP number of 159765205. The ticker
symbol for the Company stock will remain "CTHR."
The Company's shareholders at a special meeting held on
May 7, 2024, approved a proposal to
amend the Company's Restated Articles of Incorporation to effect a
Reverse Stock Split at a ratio within a range from any whole number
between one-for-ten to one-for-fifteen, as determined by the Board
of Directors in its sole discretion. The Company filed the
Articles of Amendment to its Restated Articles of Incorporation
with the North Carolina Secretary
of State on May 14, 2024.
Information for Shareholders
The Reverse Stock Split will, as of the Effective Date, reduce
the number of the issued and outstanding shares of the Company's
common stock from approximately 30,344,955 to approximately
3,034,496. The total authorized number of shares of common stock
will remain the same. No fractional shares will be issued in
connection with the Reverse Stock Split, and fractional shares
resulting from the Reverse Stock Split will be rounded up to the
nearest whole share. The Company's common stock will continue to
have no par value per share. No further action on the part of
shareholders will be required to implement the Reverse Stock
Split.
The Company's transfer agent, Equiniti Trust Company, LLC
("Equiniti"), will act as its exchange agent for the Reverse Stock
Split. Equiniti will provide instructions to any shareholders
with physical stock certificates regarding the process for
exchanging their certificates for split-adjusted shares into
"book-entry form." Shares held by shareholders in "street name"
will have their accounts automatically credited by their brokerage
firm, bank or other nominee, as will any shareholders who held
their shares in book-entry form at Equiniti. Equiniti can be
reached at (877) 248-6417 or (718) 921-8317.
Impact on Equity Incentives
Proportionate adjustments will be made to the per-share exercise
price, grant price, purchase price and/or the number of shares
subject to all then outstanding stock options, restricted stock
units and other awards (collectively, the "Equity Awards") issued
under the Company's 2008 Stock Incentive Plan and 2018 Equity
Incentive Plan (each, a "Plan" and, collectively, the "Plans"),
which will result in a proportional decrease in the number of
shares of the Company's common stock reserved for issuance upon
exercise of such Equity Awards. The number of shares then
reserved for issuance under the Plans will be reduced
proportionately based upon the Reverse Stock Split. All share
and per share amounts in the Company's financial statements and the
notes thereto will be retroactively adjusted for all periods to
give effect to the Reverse Stock Split.
Additional information about the Reverse Stock Split can be
found in the Company's definitive proxy statement filed with the
Securities and Exchange Commission on April
8, 2024, a copy of which is available
at www.sec.gov or at https://ir.charlesandcolvard.com/
under the Financials tab.
About Charles & Colvard, Ltd.
Charles & Colvard, Ltd. (Nasdaq: CTHR) believes that fine
jewelry should be as ethical as it is exquisite. Charles &
Colvard is the original creator of lab grown moissanite (a rare
gemstone formed from silicon carbide). The Company brings
revolutionary gems and fine jewelry to market by using exclusively
Made, not Mined™ above ground gemstones and a dedication to
100% recycled precious metals. The Company's Forever One™
moissanite and Caydia® lab grown diamond brands provide
exceptional quality, incredible value and a conscious approach to
bridal, high fashion, and everyday jewelry. Charles & Colvard
was founded in 1995 and is based in North
Carolina's Research Triangle
Park region. For more information, please visit
www.charlesandcolvard.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Statements expressing expectations regarding our future
and projections relating to our products, sales, revenues, and
earnings are typical of such statements and are made under the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements include, but are not limited to,
statements about our plans, objectives, representations, and
contentions and are not historical facts and typically are
identified by use of terms such as "may," "will," "should,"
"could," "expect," "intend," "plan," "anticipate," "believe,"
"estimate," "predict," "continue," and similar words, although some
forward-looking statements are expressed differently.
All forward-looking statements are subject to the risks and
uncertainties inherent in predicting the future. You should be
aware that although the forward-looking statements included herein
represent management's current judgment and expectations, our
actual results may differ materially from those projected, stated,
or implied in these forward-looking statements as a result of many
factors including, but not limited to, (1) our business and our
results of operations could be materially adversely affected as a
result of general economic and market conditions; (2) our future
financial performance depends upon increased consumer acceptance,
growth of sales of our products, and operational execution of our
strategic initiatives; (3) we face intense competition in the
worldwide gemstone and jewelry industry; (4) we have historically
been dependent on a single supplier for substantially all of our
silicon carbide, or SiC, crystals, the raw materials we use to
produce moissanite jewels; if our supply of high-quality SiC
crystals is interrupted, our business may be materially harmed; (5)
constantly evolving privacy regulatory regimes are creating new
legal compliance challenges; (6) our information technology, or IT,
infrastructure, and our network has been and may be impacted by a
cyber-attack or other security incident as a result of the rise of
cybersecurity events; (7) we are subject to certain risks due to
our international operations, distribution channels and vendors;
(8) our business and our results of operations could be materially
adversely affected as a result of our inability to fulfill orders
on a timely basis; (9) we are currently dependent on a limited
number of distributor and retail partners in our Traditional
segment for the sale of our products; (10) we may experience
quality control challenges from time to time that can result in
lost revenue and harm to our brands and reputation; (11)
seasonality of our business may adversely affect our net sales and
operating income; (12) our operations could be disrupted by natural
disasters; (13) sales of moissanite and lab grown diamond jewelry
could be dependent upon the pricing of precious metals, which is
beyond our control; (14) our current customers may potentially
perceive us as a competitor in the finished jewelry business; (15)
if the e-commerce opportunity changes dramatically or if e-commerce
technology or providers change their models, our results of
operations may be adversely affected; (16) governmental regulation
and oversight might adversely impact our operations; (17) the
effects of COVID-19 and other potential future public health
crises, epidemics, pandemics or similar events on our business,
operating results, and cash flows are uncertain; (18) the execution
of our business plans could significantly impact our
liquidity and we might not be able to continue as a going
concern; (19) we are subject to arbitration, litigation and
demands, which could result in significant liability and costs, and
impact our resources and reputation; (20) the financial
difficulties or insolvency of one or more of our major customers or
their lack of willingness and ability to market our products could
adversely affect results; (21) negative or inaccurate information
on social media could adversely impact our brand and reputation;
(22) we rely on assumptions, estimates, and data to calculate
certain of our key metrics and real or perceived inaccuracies in
such metrics may harm our reputation and negatively affect our
business; (23) we may not be able to adequately protect our
intellectual property, which could harm the value of our products
and brands and adversely affect our business;
(24) environmental, social, and governance matters may impact
our business, reputation, financial condition, and results of
operations; (25) if we fail to evaluate, implement, and integrate
strategic acquisition or disposition opportunities successfully,
our business may suffer; (26) our failure to maintain compliance
with The Nasdaq Stock Market's continued listing requirements could
result in the delisting of our common stock; (27) some
anti-takeover provisions of our charter documents may delay or
prevent a takeover of our Company; and (28) we cannot guarantee
that our share repurchase program will be utilized to the full
value approved, or that it will enhance long-term stockholder value
and repurchases we consummate could increase the volatility of the
price of our common stock and could have a negative impact on our
available cash balance, in addition to the other risks and
uncertainties described in more detail in our filings with the U.S.
Securities and Exchange Commission (the "SEC"), including our
Annual Report on Form 10-K for the fiscal year ended June 30, 2023 and subsequent reports filed with
the SEC. Forward-looking statements speak only as of the date they
are made. We undertake no obligation to update or revise such
statements to reflect new circumstances or unanticipated events as
they occur except as required by the federal securities laws, and
you are urged to review and consider disclosures that we make in
the reports that we file with the Securities and Exchange
Commission, or SEC, that discuss other factors relevant to our
business.
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SOURCE Charles & Colvard, Ltd.
