Important question! A "cold read" means the workshop instructor (the casting director) provides material, usually from the shows he or she may have worked on, that you then read "cold" (without much time to rehearse). Usually the instructor gathers each actor's headshot, and then assigns scenes, sometimes pairing actors together. You then will have 5-15 minutes to work on your scene, and then perform them for the instructor (see classroom vs 1-on-1 style for more info). Generally you should hold your sides while performing a cold read.
A "prepared material" workshop means you must bring in your own scene or monologue (be sure to check if the studio provides a reader) and perform for the instructor. Whether or not you hold your sides/script is entirely up to you, but prepared material should be just that- prepared. Some workshop studios require you to get your own scenes approved prior to your workshop. When registering always be sure to ask what that studio's policy is, as well as how to get your scene approved, if need be.