Form of BLUE Proxy CardCharles & Colvard, Ltd. Proxy Card for Annual Meeting of
Shareholders (the "Annual Meeting")

THIS PROXY SOLICITATION IS BEING MADE BY

RIVERSTYX CAPITAL MANAGEMENT, LLC

RIVERSTYX FUND, LP

RIVERSTYX FUND GP, LLC

BENJAMIN O. FRANKLIN IV

MICHAEL R. LEVIN

LLOYD M. SEMS

THE BOARD OF DIRECTORS (THE "BOARD") OF CHARLES & COLVARD, LTD. IS NOT
SOLICITING THIS PROXY

The undersigned appoints [__], [__] and John Grau and each of them, attorneys
and agents with full power of substitution to vote all shares of Charles &
Colvard, Ltd., a North Carolina corporation (the "Company"), that the
undersigned would be entitled to vote at the Annual Meeting, including at any
adjournments or postponements thereof, with all powers that the undersigned
would possess if personally present, upon and in respect of the instructions
indicated herein, with discretionary authority, subject to applicable law, as to
any and all other matters that may properly come before the meeting or any
adjournment, postponement, or substitution thereof that are unknown to us a
reasonable time before this solicitation.

The undersigned hereby revokes any other proxy or proxies heretofore given to
vote or act with respect to said shares, and hereby ratifies and confirms all
action the herein named attorneys and proxies, their substitutes, or any of them
may lawfully take by virtue hereof. This proxy will be valid until the sooner of
one year from the date indicated on the reverse side and the completion of the
Annual Meeting (including any adjournments or postponements thereof).

With respect to Proposal 1, if this proxy is signed, dated and returned, it will
be voted in accordance with your instructions. If you do not specify how the
proxy should be voted, this proxy will be voted "FOR ALL" of the nominees in
Proposal 1 (the "Nominees"). In voting this proxy card, you will only be able to
vote on all of the five director seats up for election that will be voted on by
the holders of common shares of the Company. None of the matters currently
intended to be acted upon pursuant to this proxy are conditioned on the approval
of other matters.

INSTRUCTIONS: FILL IN VOTING BOXES "" IN BLACK OR BLUE INK

*Abstentions will be treated as shares that are present and entitled to vote and
therefore will count as votes against the proposals below.

We recommend that you vote "FOR ALL" of the Nominees in Proposal 1:

Proposal 1(a) - Election at the Annual Meeting of the individuals nominated by
Riverstyx.

PLEASE SIGN, DATE AND PROMPTLY RETURN THIS PROXY IN THE ENCLOSED RETURN ENVELOPE
THAT IS POSTAGE PREPAID IF MAILED IN THE UNITED STATES.