CHARLES & COLVARD LTD

Item 1.01 Entry into a Material Definitive Agreement. As previously disclosed, on March 2, 2026, Charles & Colvard, Ltd., a North Carolina corporation (the “Company”), filed a voluntary petition for relief (the “Chapter 11 Case”) under Chapter 11 of Title 11 of the United States Code (“Chapter 11”) in the United States Bankruptcy Court for the Eastern District of North Carolina (the “Bankruptcy Court”). The case is styled as In re Charles & Colvard, Ltd. Also as previously disclosed, on April 15, 2026, the Company finalized negotiations of an Asset Purchase Agreement (the “JDP Purchase Agreement”) with Van Lang Jewelry LLC or its affiliate Jewelry Design Partners LLC (“JDP”), pursuant to which, subject to the terms and conditions set forth therein, including approval of the Bankruptcy Court, JDP agreed to acquire the assets of the Company (except for the Excluded Assets, as listed on Schedule 1 thereto) and assume certain liabilities (the “JDP Transaction”), for consideration of $1,500,000 (subject to a credit bid and offset against all of the indebtedness owed to JDP under the Section 364 Financing Loan Agreement dated March 24, 2026, by and between the Company and JDP (the “DIP Facility”)). A former member of the Company’s Board of Directors (the “Board”), Duc Pham, who resigned from the Board on March 25, 2026, is a Manager of JDP. Also as previously disclosed, on April 29, 2026, the Bankruptcy Court entered an Order (i) approving JDP as the “stalking horse” bidder with respect to the assets to be acquired under the JDP Purchase Agreement on the terms set forth in the Order, (ii) approving the “stalking horse” bidder to credit bid all or any portion of the outstanding DIP Obligations (as defined in the JDP Purchase Agreement) under the DIP Facility, as a part of the purchase price under the JDP Purchase Agreement, (iii) approving the credit bid provisions contemplated by the JDP Purchase Agreement, (iv) approving the stalking horse break-up fee and expense reimbursement as set forth in the JDP Purchase Agreement, and (v) approving the proposed bidding procedures. The Bankruptcy Court scheduled the final sale hearing for June 22, 2026, at 11:00 a.m. ET. The JDP Transaction was to be conducted pursuant to Bankruptcy Court-approved bidding procedures and was subject to (a) the receipt of a bid that meets the specifications set forth in the JDP Purchase Agreement and that constitutes, in the Company’s reasonable judgment, a higher or otherwise better offer from competing bidders, (b) approval of the sale by the Bankruptcy Court, and (c) the satisfaction of certain conditions to closing. On April 30, 2026, after approval of the Bankruptcy Court, the Company countersigned the JDP Purchase Agreement. On June 22, 2026, the Company held an auction pursuant to the bidding procedures approved by the Bankruptcy Court (the “Auction”). At the conclusion of the Auction, the Company determined the bid submitted by AJS Creations, Inc. (“AJS”) was the highest or otherwise best bid and designated AJS as the successful bidder for the Company’s assets (except for the Excluded Assets, as listed on Schedule 1 to the AJS Purchase Agreement (as defined below)). The Company also determined that the bid submitted by Light & Star USA Inc. (“Light & Star”) was the second highest or otherwise second-best bid and designated Light & Star as the back-up bidder for the Company’s assets (except for the Excluded Assets, as listed on Schedule 1 to the AJS Purchase Agreement). On June 22, 2026, the Company and AJS entered into an Overbid Purchase Agreement (the “AJS Purchase Agreement”), pursuant to which, subject to the terms and conditions set forth therein, AJS agreed to acquire specified assets related to the Company’s business and assume certain liabilities (the “AJS Transaction”), subject to the Bankruptcy Court’s approval, for cash consideration of $2,700,000. The AJS Purchase Agreement contains customary representations and warranties of the parties and is subject to a number of closing conditions, including, among others, (i) the accuracy of representations and warranties of the parties; (ii) the entry of an order approving the AJS Purchase Agreement and the transactions contemplated therein by the Bankruptcy Court; and (iii) compliance in all material respects with the obligations of the parties set forth in the AJS Purchase Agreement. Upon the consummation of the AJS Transaction, the JDP Purchase Agreement will terminate, and the Company will use a portion of the purchase price received from AJS to pay Van Lang Jewelry LLC a break-up fee of $45,000. On June 25, 2026, the Bankruptcy Court approved the AJS Purchase Agreement and the transactions contemplated therein. The AJS Purchase Agreement may be terminated by AJS or the Company under certain circumstances, including, among others, if the AJS Transaction is not consummated by July 7, 2026 (subject to specified extensions), or upon the occurrence of certain Bankruptcy Court actions. The foregoing description of the AJS Purchase Agreement is not complete and is qualified in its entirety by reference to the AJS Purchase Agreement, a copy of which is attached to this Current Report on Form 8-K as Exhibit 10.1 and is hereby incorporated herein by reference. Cautionary Note Regarding the Chapter 11 Case The Company cautions that trading in the Company’s common stock during the pendency of the Chapter 11 Case is highly speculative and poses substantial risks. Trading prices for the Company’s common stock may bear little or no relationship to the actual recovery, if any, by the holders of the Company’s common stock in the Chapter 11 Case. The Company expects that holders of the Company’s common stock may experience a significant or complete loss on their investment, depending on the outcome of the Chapter 11 Case. Accordingly, the Company urges extreme caution with respect to existing and future investments in its common stock. Cautionary Statements Regarding Forward-Looking Statements This Current Report on Form 8-K 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. These forward-looking statements typically can be 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, the Company’s 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, risks attendant to the bankruptcy process, including the Company’s ability to obtain court approval from the Bankruptcy Court with respect to motions or other requests made to the Bankruptcy Court throughout the course of Chapter 11; the effects of Chapter 11, including increased legal and other professional costs necessary to execute the Company’s restructuring process, on the Company’s liquidity (including the availability of operating capital during the pendency of Chapter 11); the effects of Chapter 11 on the interests of various constituents and financial stakeholders; the length of time that the Company will operate under Chapter 11 protection and the continued availability of operating capital during the pendency of Chapter 11; objections to the Company’s restructuring process or other pleadings filed that could protract Chapter 11; risks associated with the Company’s proposed restructuring plan; risks associated with third-party motions in Chapter 11; Bankruptcy Court rulings in the Chapter 11 process and the outcome of Chapter 11 in general; employee attrition and the Company’s ability to retain senior management and other key personnel due to the distractions and uncertainties; in addition to the other risks and uncertainties described in more detail in the Company’s filings with the U.S. Securities and Exchange Commission. Furthermore, such forward-looking statements speak only as of the date of this Current Report on Form 8-K. Except as required by applicable law, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results, later events or circumstances or to reflect the occurrence of unanticipated events.