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): December 16, 2005 KENTUCKY BANCSHARES, INC. (Exact Name of Registrant as specified in Charter) Kentucky 33-96358 61-0993464 (State or other (Commission (IRS Employer jurisdiction of File Number) Identification No.) incorporation) P.O. Box 157, Paris, Kentucky 40362-0157 (Address of principal executive offices) (Zip code) (859)987-1795 (Registrant's telephone number, including area code) N/A (Former name or former address, if changed since last report.) 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 (17CFR230.425) ? 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 CFR 240.14d-2(b)) ? Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) INFORMATION TO BE INCLUDED IN THE REPORT Item 1.01. Entry into a Material Definitive Agreement With respect to compensation in 2006, the table below sets forth the salary of each of the named executive officers, effective as of January 1, 2006. The Board's Compensation Committee approved the salary of Mr. Prichard on December 16, 2005, and the President and CEO established the salary of Messrs. Woodford and Fryman on December 19, 2005. The Compensation Committee will grant the stock grants listed below effective January 3, 2006. Also, on December 16, 2005, the Compensation Committee approved targets for the Registrant's management incentive program for its executive officers. Based upon the Registrant's net income performance relative to 2006 budget, Mr. Prichard may earn up to 40% of his annual salary in bonus compensation. Based upon the Registrant's net income performance relative to 2006 budget, Messrs. Woodford and Fryman may earn up to 22.5% of their annual salary in bonus compensation; based upon their performance relative to individual performance measures established by the President and CEO, Messrs. Woodford and Fryman may earn up to an additional 7.5% of their annual salary in bonus compensation. 2006 Salary Stock Grants Buckner Woodford, Chairman $82,800 165 Louis Prichard, President and CEO $185,000 350 Norman J. Fryman, Director of Lending $118,279 165 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. KENTUCKY BANCSHARES, INC. Date: December 20, 2005 By /s/ Gregory J. Dawson___ Gregory J. Dawson Chief Financial Officer