Sprained my knee 4 mos ago and recently started getting sharp spasms, did it not heal properly or is there more damage?

Knee sprain. It is possible that your injury caused some other internal derangement in your knee, such as a meniscal tear or surface cartilage injury. You should consult your doctor for further evaluation and treatment.
Yes. If after 4 months you still have sharp pains you probably have more than just a sprain. It could be a tear of your meniscus and you should get an mri.