Form 4: Director Goldman Receives CTHR Restricted Stock Award

Charles & Colvard Director Neal Goldman was granted 24,000 restricted stock units under the Fiscal 2026 Executive Incentive Program.

Summary

• Director Neal I. Goldman was granted 24,000 restricted stock units (RSUs) of Charles & Colvard, Ltd. (CTHR) on August 21, 2025.
• The grant is part of the Issuer's Fiscal 2026 Executive Incentive Program.
• The restricted stock is scheduled to vest quarterly over one year, commencing October 1, 2025.
• The first two tranches, originally set for October 1, 2025, and January 1, 2026, will both vest on January 1, 2026, totaling 12,000 shares.
• Goldman has an option to elect, within one week of the Issuer's Annual Report on Form 10-K filing for fiscal year ended June 30, 2025, to receive either 65% of the restricted stock (converting to common stock upon vesting) and 35% as a cash bonus, or 100% of the restricted stock (converting to common stock upon vesting).
• This election option can be changed for future vesting tranches no less than three months before such vesting event.
• Following this transaction, Goldman directly holds 111,777 shares of common stock and indirectly holds 12,000 shares of common stock via his IRA, in addition to the 24,000 restricted stock units.

Sentiment

Score: 7

Explanation: The grant of restricted stock to a director is a positive for corporate governance and incentive alignment, but it's a routine compensation event rather than a significant operational or financial development that would drastically alter the company's outlook.

Positives

• The grant of 24,000 restricted stock units to Director Neal I. Goldman aligns his interests with those of shareholders, promoting long-term value creation.
• The award is part of the Fiscal 2026 Executive Incentive Program, indicating a structured approach to executive compensation and motivation within the company.

Negatives

• NA

Risks

• NA

Future Outlook

The restricted stock award is designed to vest quarterly over one year, beginning October 1, 2025, with specific adjustments for the initial tranches. The reporting person has an election option regarding the mix of stock and cash for the award, which can be modified for future tranches.

Industry Context

This filing reflects standard executive compensation practices involving equity awards, common across various industries to align management incentives with shareholder value and promote long-term commitment.

Corporate Governance

Related Party Transactions

• The restricted stock award to Director Neal I. Goldman constitutes a related party transaction as part of his compensation package, which is a standard practice for executive and director incentives.

Stakeholder Impact

• Shareholders: Potential positive impact due to increased alignment of the director's interests with long-term shareholder value through equity ownership.
• Management/Employees: Reflects ongoing executive incentive programs, which can contribute to morale, retention, and performance motivation for key personnel.

Next Steps

• The reporting person is to elect between receiving 65% restricted stock/35% cash bonus or 100% restricted stock within one week of the Issuer's FY2025 10-K filing.
• Vesting of the restricted stock units will commence, with the first 12,000 shares vesting on January 1, 2026, and subsequent tranches vesting quarterly thereafter.

Key Dates

Recommendation

This Form 4 reports a routine restricted stock grant to a director as part of an incentive program. While it aligns management interests with shareholders, it does not present new material information that would fundamentally alter the investment outlook for Charles & Colvard, Ltd. Therefore, a 'hold' recommendation is appropriate, maintaining existing positions based on broader company fundamentals.

Keywords

CTHR, Charles & Colvard, Neal Goldman, Restricted Stock, Insider Transaction, Form 4, Equity Award, Director Compensation, Executive Incentive Program