Item 2.03    Creation of a Direct Financial Obligation or an Obligation under an
             Off-Balance Sheet Arrangement of a Registrant

On April 20, 2020, a subsidiary of Sharp Compliance Corp. (the "Company") received loan proceeds of $2,183,187 under the Paycheck Protection Program ("PPP") under a promissory note from its existing commercial bank (the "PPP Loan"). The PPP, established as part of the Coronavirus Aid, Relief and Economic Security Act ("CARES Act"), provides for loans to qualifying businesses for amounts up to 2.5 times the average monthly payroll expenses of the qualifying business. The loans and accrued interest are forgivable after eight weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels.

The term of the Company's PPP Loan is two years. The annual interest rate on the PPP Loan is 1% and no payments of principal or interest are due during the six-month period beginning on the date of the PPP Loan (the "Deferral Period").

Under the terms of the CARES Act, PPP Loan recipients can apply for and be granted forgiveness for all or a portion of loans granted under the PPP. Such forgiveness will be determined, subject to limitations, based on the use of loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and the maintenance of its payroll levels. No assurance is provided that the Company will obtain forgiveness of the PPP Loan in whole or in part.

The PPP Loan requires the Company to comply with or to perform the terms, obligations, covenants or conditions contained in the Company's current Credit Agreement and Loan Agreement. Both the Credit Agreement and Loan Agreement contain affirmative and negative covenants that, among other things, require the Company to maintain a maximum cash flow leverage ratio and a minimum debt service coverage ratio. The Credit Agreement and Loan Agreement also contain customary events of the Company's default which, if uncured, may terminate the Credit Agreement or Loan Agreement and require, among other things immediate repayment of all indebtedness to the lenders.

The description of the PPP Loan contained herein is qualified in its entirety by reference to the PPP Loan, a copy of which is attached as Exhibit 10.1 (PPP Loan) to this current Report on Form 8-K and is incorporated herein by reference.


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Item 8.01. Other Events.

On April 21, 2020, Sharps Compliance Corp. (the "Company", "Sharps" or "we") issued a press release regarding its receipt of the proceeds of the PPP loan.

A copy of the press release issued by the Company is attached hereto as Exhibit 99.1.




Item 9.01.  Financial Statements and Exhibits.
(a)    Financial Information
Not applicable
(b)    Pro Forma Financial Information
Not applicable
(c)    Exhibits. The following exhibit is filed herewith:
Exhibit  Description
    99.1  Press Release, dated April 21, 2020

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