UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED)
June 22, 2006 (June 20, 2006)
Commission File No. 000-22390
SHARPS COMPLIANCE CORP.
(Exact Name Of Registrant As Specified In Its Charter)
Delaware 74-2657168
(State Or Other Jurisdiction Of (IRS Employer
Incorporation Or Organization) Identification No.)
9350 Kirby Drive, Suite 300
Houston, Texas 77054
(Address Of Principal Executive Offices)
Registrant's Telephone Number, Including Area Code)
713-432-0300
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
[GRAPHIC OMITTED]
Item 1.01. Entry into a Material Definitive Agreement.
On June 20, 2006, the Company's Board of Directors approved the accelerated
vesting of unvested stock options previously awarded to employees, officers, and
directors, as of June 30, 2006, in light of new accounting regulations that will
take effect on July 1, 2006. The Board took the action with the belief that it
is in the best interest of stockholders, as it will reduce the Company's
reported compensation expense in future periods.
As a result of the vesting acceleration, options to purchase 757,696 shares of
Sharps Compliance Corp. common stock, which would otherwise have vested
primarily over the next one to two years, will become exercisable immediately.
Based upon the closing stock price for the Company's common stock of $0.91 per
share on June 20, 2006, eighty-four percent (84%), or 637,696, of the total
accelerated common stock options are "in-the-money" and have exercise prices
ranging from $0.52 to $0.86 per share. Sixteen percent (16%), or 120,000, of the
total accelerated stock options are "under water" or "out-of-the-money" and have
exercise prices ranging from $0.95 to $1.15 per share. Of the accelerated
options, 328,408 options are held by executive officers (of which 228,408 are
"in-the-money"), 246,774 options are held by non-employee directors (all of
which are "in-the-money"), and 182,514 options are held by other employees (of
which 162,514 are "in-the-money"). In addition to the above, the vesting of
annual grants to non-employee directors totaling 260,000 stock options
(scheduled to be granted on June 28, 2006) will also be accelerated.
Under the recently issued Statement of Financial Accounting Standards No. 123R,
"Share-Based Payment" (SFAS 123R), the Company would be required to apply the
expense recognition provisions beginning July 1, 2006. As a result of the
acceleration, the Company expects to eliminate anticipated stock option expense
of approximately $230,000 in fiscal year 2007, $130,000 in fiscal year 2008, and
$55,000 in fiscal year 2009 on a pre-tax basis, based upon the Company's value
calculations using the Black-Scholes methodology. The acceleration is expected
to generate non-cash compensation expense of approximately $18,000 in the
current quarter ending June 30, 2006.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
99.1 Press Release dated June 22 , 2006
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
SHARPS COMPLIANCE CORP.
By: /s/ David P. Tusa
---------------------------------------
Executive Vice President , Chief
inancial Officer and Business
Development
Dated: June 22, 2006