Exhibit 10.1
Kentucky Bancshares, Inc.
2009 Stock Award Plan

SECTION 1
Purpose

The purpose of the Kentucky Bancshares, Inc. 2009 Stock Award Plan (the
"Plan") is to motivate and reward key employees, directors, advisory
directors, consultants and advisers by giving them a proprietary interest in
the Company's success.
SECTION 2
Definitions

As used in the Plan, the following terms shall have the meanings set
forth below:
"Award" shall mean any Option, Stock Appreciation Right, Restricted
Stock or Other Stock-Based Award.

"Award Agreement" shall mean any written or electronic notice of grant,
agreement, contract or other instrument or document evidencing any Award,
which may, but need not, be required to be executed, acknowledged or accepted
by a Participant.

"Board" shall mean the Board of Directors of the Company.

"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.

"Committee" shall mean, until otherwise determined by the Board, the
Compensation Committee of the Board.

"Common Stock" shall mean shares of common stock, no par value per
share, of the Company.

"Company" shall mean Kentucky Bancshares, Inc.

"Designated Beneficiary" shall mean the beneficiary designated by the
Participant, in a manner determined by the Board or Committee, to receive the
benefits due the Participant under the Plan in the event of the Participant's
death. In the absence of an effective designation by the Participant,
Designated Beneficiary shall mean the Participant's estate.

"Eligible Individual" shall mean (i) any person providing services as
an officer and/or director or advisory director of the Company or a
Subsidiary, whether or not employed by such entity, (ii) any employee of the
Company or a Subsidiary, including any director who is also an employee of
the Company or a Subsidiary, (iii) any officer or employee of an entity with
which the Company has contracted to receive executive, management or legal
services who provides services to the Company or a Subsidiary through such
arrangement, (iv) any consultant or adviser to the Company, a Subsidiary or
to an entity described in clause (iii) hereof who provides services to the
Company or a Subsidiary through such arrangement and (v) any person who has
agreed in writing to become a person described in clauses (i), (ii), (iii) or
(iv) within not more than 30 days following the date of grant of such
person's first Award under the Plan.

"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.

"Incentive Stock Option" shall mean an option granted under Section 6
of the Plan that is intended to meet the requirements of Section 422 of the
Code or any successor provision thereto.

"Nonqualified Stock Option" shall mean an option granted under Section
6 of the Plan that is not intended to be an Incentive Stock Option.

 "Option" shall mean an Incentive Stock Option or a Nonqualified Stock
Option.

"Other Stock-Based Award" shall mean any right or award granted under
Section 9 of the Plan.

"Participant" shall mean any Eligible Individual granted an Award under
the Plan.

"Person" shall mean any individual, corporation, partnership, limited
liability company, association, joint-stock company, trust, unincorporated
organization, government or political subdivision thereof or other entity.

"Restricted Stock" shall mean any restricted stock granted under
Section 8 of the Plan.

"Section 162(m)" shall mean Section 162(m) of the Code and all
regulations promulgated thereunder as in effect from time to time.

"Shares" shall mean the shares of Common Stock and such other
securities of the Company or a Subsidiary as the Board or Committee may from
time to time designate.

"Stock Appreciation Right" shall mean any right granted under Section 7
of the Plan.

"Subsidiary" shall mean (i) any corporation or other entity in which
the Company possesses directly or indirectly equity interests representing at
least 50% of the total ordinary voting power or at least 50% of the total
value of all classes of equity interests of such corporation or other entity
and (ii) any other entity in which the Company has a direct or indirect
economic interest that is designated as a Subsidiary by the Board or the
Committee.

SECTION 3
Administration and Delegation

(a)	 Administration.  The Board or Committee shall administer the
Plan. Subject to the terms of the Plan and applicable law, and in addition to
other express powers and authorizations conferred on the Board or Committee
by the Plan, the Board and the Committee shall each have full power and
authority to:
1.	designate Participants;
2.	determine the type or types of Awards to be granted to an
Eligible Individual;
3.	determine the number of Shares to be covered by, or with
respect to which payments, rights or other matters are to
be calculated in connection with, Awards;
4.	determine the terms and conditions of any Award;
5.	determine whether, to what extent, and under what
circumstances Awards may be settled or exercised in cash,
whole Shares, other whole securities, other Awards, other
property or other cash amounts payable by the Company upon
the exercise of that or other Awards, or canceled,
forfeited or suspended and the method or methods by which
Awards may be settled, exercised, canceled, forfeited or
suspended;
6.	determine whether, to what extent, and under what
circumstances cash, Shares, other securities, other Awards,
other property, and other amounts payable by the Company
with respect to an Award shall be deferred either
automatically or at the election of the holder thereof, the
Board or the Committee;
7.	interpret and administer the Plan and any instrument or
agreement relating to, or Award made under, the Plan;
8.	establish, amend, suspend or waive such rules and
regulations and appoint such agents as it shall deem
appropriate for the proper administration of the Plan; and
9.	 make any other determination and take any other action
that the Board or Committee deems necessary or desirable
for the administration of the Plan.
Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations and other decisions under or with respect to
the Plan or any Award shall be within the sole discretion of the Committee.
Such designations, determinations, interpretations and other decisions may be
made at any time and shall be final, conclusive and binding upon all Persons,
including the Company, any Subsidiary, any Participant, any holder or
beneficiary of any Award, any stockholder of the Company and any Eligible
Individual.
(b)	Delegation.  Subject to the terms of the Plan and applicable law,
the Board and the Committee may each delegate to one or more or their
members, or to one or more agents, such administrative duties as they may
deem advisable.  The Board or the Committee, or any person to whom either has
delegated duties as aforesaid, may employ one or more persons to render
advice with respect to any responsibility of the Board, the Committee, or
such person may have under the Plan.  The Board and the Committee may each
employ such legal or other counsel, consultants and agents as they may deem
desirable for the administration of the Plan and may rely upon any opinion or
computation received from any such counsel, consultant or agent.  Expenses
incurred by the Board and by the Committee in the engagement of such counsel,
consultant or agent shall be paid by the Company, or the subsidiary or
affiliate whose employees have benefitted from the Plan, as determined by the
Board or the Committee.
(c)	Board Action.  A majority of the whole Board shall constitute a
quorum, and the acts of a majority of the members of the Board present at a
meeting at which a quorum is present, or acts approved in writing by all of
the members of the Board, shall be the acts of the Board for purposes of any
action the Board takes permitted by this Plan.
SECTION 4
Eligibility

Any Eligible Individual shall be eligible to be granted an Award.

SECTION 5
Shares Available; Adjustment

(a)	 Shares Available for Awards. Subject to adjustment as provided
in Section 5(b):
1.	 Calculation of Number of Shares Available.
(i)	Subject to the other provisions of this Section 5(a),
the number of Shares with respect to which Awards
payable in Shares may be granted under the Plan shall
be 150,000 Awards that by their terms may be settled
only in cash shall not be counted against the maximum
number of Shares provided herein.
(ii)	The number of Shares that may be issued pursuant to
Incentive Stock Options may not exceed 100,000
Shares.
(iii)	To the extent any Shares covered by an Award are not
issued because the Award is forfeited or canceled or
the Award is settled in cash, such Shares shall again
be available for grant pursuant to new Awards under
the Plan.
(iv)	In the event that Shares are issued as Restricted
Stock or Other Stock-Based Awards under the Plan and
thereafter are forfeited or reacquired by the Company
pursuant to rights reserved upon issuance thereof,
such Shares shall again be available for grant
pursuant to new Awards under the Plan.
(v)	If the exercise price of any Option is satisfied by
tendering Shares to the Company, only the number of
Shares issued net of the Shares tendered shall be
deemed issued for purposes of determining the maximum
number of Shares available for issuance under Section
5(a)(i)(A).  However, all of the Shares issued upon
exercise shall be deemed issued for purposes of
determining the maximum number of Shares that may be
issued pursuant to Incentive Stock Options.
2.	Shares Deliverable Under Awards.  Any Shares delivered
pursuant to an Award may consist of authorized and unissued
Shares, Shares held by the Company or a Subsidiary and
Shares acquired in the open market or otherwise obtained by
the Company or a Subsidiary. The issuance of Shares may be
effected on a non-certificated basis, to the extent not
prohibited by applicable law or the applicable rules of any
stock exchange.
3.	Individual Limit. Any provision of the Plan to the contrary
notwithstanding, no individual may receive in any year
Awards under the Plan, whether payable in cash or Shares,
that relate to more than 5000 Shares.
4.	Use of Shares.  Subject to the terms of the Plan and the
overall limitation on the number of Shares that may be
delivered under the Plan, the Board and the Committee may
each use available Shares as the form of payment for
compensation, grants or rights earned or due under any
other compensation plans or arrangements of the Company or
a Subsidiary and the plans or arrangements of the Company
or a Subsidiary assumed in business combinations.
(b)	 Adjustments.  In the event that the Board or Committee
determines that any dividend or other distribution (whether in the form of
cash, Shares, Subsidiary securities, other securities or other property),
recapitalization, stock split, reverse stock split, reorganization, merger,
consolidation, split-up, spin-off, combination, repurchase or exchange of
Shares or other securities of the Company, issuance of warrants or other
rights to purchase Shares or other securities of the Company, or other
similar corporate transaction or event affects the Shares such that an
adjustment is determined by the Board or Committee to be appropriate to
prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the Plan, then the Board or Committee
shall, in such manner as it may deem equitable, adjust any or all of (i) the
number and type of Shares (or other securities or property) with respect to
which Awards may be granted, (ii) the number and type of Shares (or other
securities or property) subject to outstanding Awards, and (iii) the grant or
exercise price with respect to any Award and, if deemed appropriate, make
provision for a cash payment to the holder of an outstanding Award and, if
deemed appropriate, adjust outstanding Awards to provide the rights
contemplated by Section 10(b) hereof; provided, in each case, that with
respect to Awards of Incentive Stock Options no such adjustment shall be
authorized to the extent that such authority would cause the Plan to violate
Section 422(b)(1) of the Code or any successor provision thereto and, with
respect to all Awards under the Plan, no such adjustment shall be authorized
to the extent that such authority would be inconsistent with the requirements
for full deductibility under Section 162(m); and provided further that the
number of Shares subject to any Award denominated in Shares shall always be a
whole number.
SECTION 6
Stock Options

(a)	 Stock Options. Subject to the provisions of the Plan, the Board
and the Committee shall each have the authority to determine the Eligible
Individuals to whom Options shall be granted, the number of Shares to be
covered by each Option, the option price thereof, the conditions and
limitations applicable to the exercise of the Option and the other terms
thereof. The Board and the Committee shall each have the authority to grant
Incentive Stock Options, Nonqualified Stock Options or both. In the case of
Incentive Stock Options, the terms and conditions of such grants shall be
subject to and comply with such rules as may be required by Section 422 of
the Code, as from time to time amended, and any implementing regulations;
provided, however, that if, on the date of the grant of Incentive Stock
Options, the Eligible Individual to whom such grant is to be made (together
with persons whose stock ownership is attributed to such individual pursuant
to Code Section 424(d)) owns securities possessing more than ten percent of
the total combined voting power of all classes of stock of the Company or any
of its subsidiaries, the exercise price will not be less than 110% of the
fair market value of the Shares to which the Inventive Stock Option relates
determined as of the date of the grant, and such Incentive Stock Options are
not exercisable after the date five years from the date of the grant.
Notwithstanding the foregoing, no Eligible Individual may be granted
Incentive Stock Options which would result in Shares with an aggregate fair
market value (measured on the date of the grant) of more than $100,000 first
becoming exercisable in any one calendar year.
(b)	Exercise. Each Option shall be exercisable at such times and
subject to such terms and conditions as the Board or Committee may specify in
the applicable Award Agreement or thereafter, provided, however, that in no
event may any Option granted hereunder be exercisable after the expiration of
10 years after the date of such grant. The Board or the Committee may each
impose such conditions with respect to the exercise of Options, including
without limitation, any condition relating to the application of Federal or
state securities laws, as it may deem necessary or advisable. An Option may
be exercised, in whole or in part, by giving written notice to the Company,
specifying the number of Shares to be purchased. The exercise notice shall be
accompanied by the full purchase price for the Shares.
(c)	 Payment. The Option price shall be payable in United States
dollars and may be paid by (i) cash or cash equivalent; (ii) delivery of
shares of Common Stock, which shares shall be valued for this purpose at the
fair market value (valued in accordance with procedures established by the
Board or the Committee) as of the effective date of such exercise and, unless
otherwise determined by the Board or the Committee, shall have been held by
the optionee for at least six months; or (iii) in such other manner as may be
authorized from time to time by the Board or the Committee. Prior to the
issuance of Shares upon the exercise of an Option, a Participant shall have
no rights as a shareholder.
SECTION 7
Stock Appreciation Rights

(a)	 Stock Appreciation Rights. Subject to the provisions of the
Plan, the Board and the Committee shall each have authority to determine the
Eligible Individuals to whom Stock Appreciation Rights shall be granted, the
number of Shares to be covered by each Award of Stock Appreciation Rights,
the grant price thereof, the conditions and limitations applicable to the
exercise of the Stock Appreciation Right and the other terms thereof. Stock
Appreciation Rights may be granted in tandem with another Award, in addition
to another Award, or freestanding and unrelated to any other Award. Stock
Appreciation Rights granted in tandem with or in addition to an Option or
other Award may be granted either at the same time as the Option or other
Award or at a later time. Stock Appreciation Rights shall not be exercisable
after the expiration of 10 years after the date of grant.
(b)	 A Stock Appreciation Right shall entitle the holder thereof to
receive upon exercise, for each Share to which the Stock Appreciation Right
relates, an amount equal to the excess, if any, of the fair market value of a
Share on the date of exercise of the Stock Appreciation Right over the grant
price. Any Stock Appreciation Right shall be settled in cash, unless the
Board or the Committee shall determine at the time of grant of a Stock
Appreciation Right that it shall or may be settled in cash, Shares or a
combination of cash and Shares.
SECTION 8
Restricted Stock

(a)	 Grant of Restricted Stock. Subject to the provisions of the
Plan, the Board and the Committee shall each have authority to determine the
Eligible Individuals to whom Restricted Stock shall be granted, the number of
Shares to be covered by each Award of Restricted Stock and the terms,
conditions, and limitations applicable thereto. The Board and the Committee
shall also each have authority to grant restricted stock units. Restricted
stock units shall be subject to the requirements applicable to Other Stock-
Based Awards under Section 9. An Award of Restricted Stock may be subject to
the attainment of specified performance goals or targets, restrictions on
transfer, forfeitability provisions and such other terms and conditions as
the Board or Committee may determine, subject to the provisions of the Plan.
An award of Restricted Stock may be made in lieu of the payment of cash
compensation otherwise due to an Eligible Individual. To the extent that
Restricted Stock is intended to qualify as "performance-based compensation"
under Section 162(m), it must meet the additional requirements imposed
thereby.
(b)	 The Restricted Period. At the time that an Award of Restricted
Stock is made, the Board or Committee shall establish a period of time during
which the transfer of the Shares of Restricted Stock shall be restricted (the
"Restricted Period").  Each Award of Restricted Stock may have a different
Restricted Period. A Restricted Period of at least three years is required
with incremental vesting of the Award over the three-year period permitted.
However, if the grant or vesting of the Shares is subject to the attainment
of specified performance goals, a Restricted Period of at least one year with
incremental vesting is permitted. The expiration of the Restricted Period
shall also occur as provided in the Award Agreement in accordance with
Section 11(a) hereof.
(c)	 Escrow. The Participant receiving Restricted Stock shall enter
into an Award Agreement with the Company setting forth the conditions of the
grant. Certificates representing Shares of Restricted Stock shall be
registered in the name of the Participant and deposited with the Company,
together with a stock power endorsed in blank by the Participant. Each such
certificate shall bear a legend in substantially the following form:
 The transferability of this certificate and the shares of Common Stock
represented by it are subject to the terms and conditions (including
conditions of forfeiture) contained in the Kentucky Bancshares, Inc.
Stock Award Plan (the "Plan") and a notice of grant issued thereunder
to the registered owner by Kentucky Bancshares, Inc. Copies of the Plan
and the notice of grant are on file at the principal office of Kentucky
Bancshares, Inc.

(d)	Dividends on Restricted Stock. Any and all cash and stock
dividends paid with respect to the Shares of Restricted Stock shall be
subject to any restrictions on transfer, forfeitability provisions or
reinvestment requirements as the Board or the Committee may, in its
discretion, prescribe in the Award Agreement.
(e)	 Forfeiture. In the event of the forfeiture of any Shares of
Restricted Stock under the terms provided in the Award Agreement (including
any additional Shares of Restricted Stock that may result from the
reinvestment of cash and stock dividends, if so provided in the Award
Agreement), such forfeited shares shall be surrendered and the certificates
canceled. The Participants shall have the same rights and privileges, and be
subject to the same forfeiture provisions, with respect to any additional
Shares received pursuant to Section 5(b) or Section 10(b) due to a
recapitalization, merger or other change in capitalization.
(f)	 Expiration of Restricted Period. Upon the expiration or
termination of the Restricted Period and the satisfaction of any other
conditions prescribed by the Board or the Committee or at such earlier time
as provided in the Award Agreement or an amendment thereto, the restrictions
applicable to the Restricted Stock shall lapse and a stock certificate for
the number of Shares of Restricted Stock with respect to which the
restrictions have lapsed shall be delivered, free of all such restrictions
and legends, except any that may be imposed by law, to the Participant or the
Participant's estate, as the case may be.
(g)	 Rights as a Shareholder. Subject to the terms and conditions of
the Plan and subject to any restrictions on the receipt of dividends that may
be imposed in the Award Agreement, each Participant receiving Restricted
Stock shall have all the rights of a shareholder with respect to Shares of
stock during any period in which such Shares are subject to forfeiture and
restrictions on transfer, including without limitation, the right to vote
such Shares.
(h)	 Performance-Based Restricted Stock under Section 162(m). The
Board or the Committee shall determine at the time of grant if a grant of
Restricted Stock is intended to qualify as "performance-based compensation"
as that term is used in Section 162(m). Any such grant shall be conditioned
on the achievement of one or more performance measures. The performance
measures pursuant to which the Other Stock-Based Award shall vest shall be
any or a combination of the following: return on equity, earnings per share,
total earnings, earnings growth, return on capital, return on assets, an
economic value added measure, earnings before interest and taxes, sales
growth, gross margin return on investment,  share price (including, but not
limited to, growth measures and total shareholder return), net operating
profit, cash flow (including, but not limited to, operating cash flow and
free cash flow), cash flow return on investments (which equals net cash flow
divided by total capital), internal rate of return, increase in net present
value or expense targets, reduction of expenses, containment of expenses
within budget, reserve recognition, addition to reserves, of the Company or a
Subsidiary. For any performance period, such performance objectives may be
measured on an absolute basis or relative to a group of peer companies
selected by the Board or the Committee, relative to internal goals or
relative to levels attained in prior years. For grants of Restricted Stock
intended to qualify as "performance-based compensation," the grants of
Restricted Stock and the establishment of performance measures shall be made
during the period required under Section 162(m).
SECTION 9
Other Awards

(a)	 Other Stock-Based Awards. The Board and the Committee each is
hereby authorized to grant to Eligible Individuals an "Other Stock-Based
Award", which shall consist of an Award that is not an instrument or Award
specified in Sections 6 through 8 of this Plan, the value of which is based
in whole or in part on the value of Shares, including a restricted stock
unit.  Other Stock-Based Awards may be awards of Shares or may be denominated
or payable in, valued in whole or in part by reference to, or otherwise based
on or related to, Shares (including, without limitation, securities
convertible or exchangeable into or exercisable for Shares), as deemed by the
Board or the Committee consistent with the purposes of the Plan. The Board or
the Committee shall determine the terms and conditions of any such Other
Stock-Based Award and may provide that such awards would be payable in whole
or in part in cash. To the extent that an Other Stock-Based Award is intended
to qualify as "performance-based compensation" under Section 162(m), it must
be made subject to the attainment of one or more of the performance goals
specified in Section 9(b) hereof and meet the additional requirements imposed
by Section 162(m).  Other Stock-Based Awards will comply with the timing and
distribution requirements of Section 409A of the Code.
(b)	 Performance-Based Other Stock-Based Awards under Section 162(m).
The Board or the Committee shall determine at the time of grant if the grant
of an Other Stock-Based Award is intended to qualify as "performance-based
compensation" as that term is used in Section 162(m). Any such grant shall be
conditioned on the achievement of one or more performance measures. The
performance measures pursuant to which the Other Stock-Based Award shall vest
shall be any or a combination of the following: return on equity, earnings
per share, total earnings, earnings growth, return on capital, return on
assets, an economic value added measure, earnings before interest and taxes,
sales growth, gross margin return on investment,  share price (including, but
not limited to, growth measures and total shareholder return), net operating
profit, cash flow (including, but not limited to, operating cash flow and
free cash flow), cash flow return on investments (which equals net cash flow
divided by total capital), internal rate of return, increase in net present
value or expense targets, reduction of expenses, containment of expenses
within budget, reserve recognition, addition to reserves, of the Company or a
Subsidiary. For any performance period, such performance objectives may be
measured on an absolute basis or relative to a group of peer companies
selected by the Board or the Committee, relative to internal goals or
relative to levels attained in prior years. For grants of Other Stock-Based
Awards intended to qualify as "performance-based compensation," the grants of
Other Stock-Based Awards and the establishment of performance measures shall
be made during the period required under Section 162(m).
(c)	Equivalents. In the discretion of the Board or the Committee, an
Award, whether made as an Other Stock-Based Award under this Section 9 or as
an Award granted pursuant to Sections 6 through 8 hereof, may provide the
holder thereof with dividends or dividend equivalents, payable in cash,
Shares, Subsidiary securities, other securities or other property on a
current or deferred basis.  If paid on a deferred basis, then the timing and
distribution requirements of an Award or Other Stock-Based Award will apply
with Section 409A of the Code.
SECTION 10
Amendment or Discontinuance of Plan; Adjustment of Awards; Cancellation of
Awards

(a)	 Amendment or Discontinuance of the Plan. The Board may amend or
discontinue the Plan at any time; provided, however, that no such amendment
may
1.	 without the approval of the stockholders, (i) increase,
subject to adjustments permitted herein, the maximum number
of shares of Common Stock that may be issued through the
Plan, (ii) materially increase the benefits accruing to
Participants under the Plan, (iii) materially expand the
classes of persons eligible to participate in the Plan, or
(iv) amend Section 10(c) to permit a reduction in the
exercise price of Options; or
2.	 materially impair, without the consent of the recipient,
an Award previously granted.
(b)	 Adjustment of Awards Upon the Occurrence of Certain Unusual or
Nonrecurring Events.  The Board and the Committee is each hereby authorized
to make adjustments in the terms and conditions of, and the criteria included
in, Awards in recognition of unusual or nonrecurring events (including,
without limitation, the events described in Section 5(b) hereof) affecting
the Company, or the financial statements of the Company or any Subsidiary, or
of changes in applicable laws, regulations, or accounting principles,
whenever the Board or the Committee determines that such adjustments are
appropriate to prevent dilution or enlargement of the benefits or potential
benefits intended to be made available under the Plan.
(c)	 Cancellation. Any provision of this Plan or any Award Agreement
to the contrary notwithstanding, the Board or the Committee may cause any
Award granted hereunder to be canceled in consideration of a cash payment or
alternative Award made to the holder of such canceled Award equal in value to
such canceled Award.  Notwithstanding the foregoing, except for adjustments
permitted under Sections 5(b) and 10(b) no action by the Board or the
Committee shall cause a reduction in the exercise price of Options granted
under the Plan without the approval of the stockholders of the Company. The
determinations of value under this subparagraph shall be made by the Board or
the Committee.
SECTION 11
Provisions Applicable to All Awards

(a)	 Award Agreements. Each Award hereunder shall be evidenced by an
agreement or notice delivered to the Participant (by paper copy or
electronically) that shall specify the terms and conditions thereof and any
rules applicable thereto, including but not limited to the effect on such
Award of the death, retirement or other termination of employment or
cessation of consulting or advisory services of the Participant and the
effect thereon, if any, of a change in control of the Company.
(b)	Withholding.
1.	 A Participant shall be required to pay to the Company, and
the Company shall have the right to deduct from all amounts
paid to a Participant (whether under the Plan or
otherwise), any taxes required by law to be paid or
withheld in respect of Awards hereunder to such
Participant. The Board or the Committee may provide for
additional cash payments to holders of Awards to defray or
offset any tax arising from the grant, vesting, exercise or
payment of any Award.
2.	At any time that a Participant is required to pay to the
Company an amount required to be withheld under the
applicable tax laws in connection with the issuance of
Shares under the Plan, the Participant may, if permitted by
the Board or the Committee, satisfy this obligation in
whole or in part by delivering currently owned Shares or by
electing (the "Election") to have the Company withhold from
the issuance Shares, which Shares shall have a value equal
to the minimum amount required to be withheld. The value of
the Shares delivered or withheld shall be based on the fair
market value of the Shares on the date as of which the
amount of tax to be withheld shall be determined in
accordance with applicable tax laws (the "Tax Date").
3.	 Each Election to have Shares withheld must be made prior
to the Tax Date. If a Participant wishes to deliver Shares
in payment of taxes, the Participant must so notify the
Company prior to the Tax Date.
(c)	Transferability. No Awards granted hereunder may be transferred,
pledged, assigned or otherwise encumbered by a Participant except: (i) by
will; (ii) by the laws of descent and distribution; (iii) pursuant to a
domestic relations order, as defined in the Code, if permitted by the Board
or the Committee and so provided in the Award Agreement or an amendment
thereto; or (iv) if permitted by the Board or Committee and so provided in
the Award Agreement or an amendment thereto.  Options granted in tandem
therewith may be transferred or assigned (w) to Immediate Family Members, (x)
to a partnership in which Immediate Family Members, or entities in which
Immediate Family Members are the owners, members or beneficiaries, as
appropriate, are the partners, (y) to a limited liability company in which
Immediate Family Members, or entities in which Immediate Family Members are
the owners, members or beneficiaries, as appropriate, are the members, or (z)
to a trust for the benefit of Immediate Family Members; provided, however,
that no more than a de minimus beneficial interest in a partnership, limited
liability company or trust described in (x), (y) or (z) above may be owned by
a person who is not an Immediate Family Member or by an entity that is not
beneficially owned solely by Immediate Family Members. "Immediate Family
Members" shall be defined as the spouse and natural or adopted children or
grandchildren of the Participant and their spouses. To the extent that an
Incentive Stock Option is permitted to be transferred during the lifetime of
the Participant, it shall be treated thereafter as a Nonqualified Stock
Option. Any attempted assignment, transfer, pledge, hypothecation or other
disposition of Awards, or levy of attachment or similar process upon Awards
not specifically permitted herein, shall be null and void and without effect.
The designation of a Designated Beneficiary shall not be a violation of this
Section 11(c).
(d)	 Share Certificates. All certificates for Shares or other
securities delivered under the Plan pursuant to any Award or the exercise
thereof shall be subject to such stop transfer orders and other restrictions
as the Board or Committee may deem advisable under the Plan or the rules,
regulations, and other requirements of the Securities and Exchange
Commission, any stock exchange upon which such Shares or other securities are
then listed, and any applicable federal or state laws, and the Board or
Committee may cause a legend or legends to be put on any such certificates to
make appropriate reference to such restrictions.
(e)	 No Fractional Shares. No fractional Shares shall be issued or
delivered pursuant to the Plan or any Award, and the Board or Committee shall
determine whether cash, other securities or other property shall be paid or
transferred in lieu of any fractional Shares or whether such fractional
Shares or any rights thereto shall be canceled, terminated, or otherwise
eliminated.
(f)	 Deferral Permitted. Payment of cash or distribution of any
Shares to which a Participant is entitled under any Award shall be made as
provided in the Award Agreement. Payment may be deferred at the option of the
Participant if provided in the Award Agreement and such deferral complies
with the timing and distribution requirements of Section 409A of the Code.
SECTION 12
Miscellaneous

(a)	No Limit on Other Compensation Arrangements. Nothing contained in
the Plan shall prevent the Company from adopting or continuing in effect
other compensation arrangements, which may, but need not, provide for the
grant of options, stock appreciation rights and other types of Awards
provided for hereunder (subject to stockholder approval of any such
arrangement if approval is required), and such arrangements may be either
generally applicable or applicable only in specific cases.
(b)	 No Right to Employment. The grant of an Award shall not be
construed as giving a Participant the right to be retained in the employ of
or as a consultant or adviser to the Company or any Subsidiary or in the
employ of or as a consultant or adviser to any other entity providing
services to the Company. The Company or any Subsidiary or any such entity may
at any time dismiss a Participant from employment, or terminate any
arrangement pursuant to which the Participant provides services to the
Company or a Subsidiary, free from any liability or any claim under the Plan,
unless otherwise expressly provided in the Plan or in any Award Agreement. No
Eligible Individual or other person shall have any claim to be granted any
Award, and there is no obligation for uniformity of treatment of Eligible
Individuals, Participants or holders or beneficiaries of Awards.
(c)	Governing Law. The validity, construction, and effect of the
Plan, any rules and regulations relating to the Plan and any Award Agreement
shall be determined in accordance with the laws of the Commonwealth of
Kentucky.
(d)	 Severability. If any provision of the Plan or any Award is or
becomes or is deemed to be invalid, illegal, or unenforceable in any
jurisdiction or as to any Person or Award, or would disqualify the Plan or
any Award under any law deemed applicable by the Board or the Committee, such
provision shall be construed or deemed amended to conform to applicable laws,
or if it cannot be construed or deemed amended without, in the determination
of the Board or the Committee, materially altering the intent of the Plan or
the Award, such provision shall be stricken as to such jurisdiction, Person
or Award and the remainder of the Plan and any such Award shall remain in
full force and effect.
(e)	 No Trust or Fund Created. Neither the Plan nor any Award shall
create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Company and a Participant or any other
Person. To the extent that any Person acquires a right to receive payments
from the Company pursuant to an Award, such right shall be no greater than
the right of any unsecured general creditor of the Company.
(f)	 Compliance with Law. The Company intends that Awards granted
under the Plan, or any deferrals thereof, will comply with the requirements
of Section 409A of the Code and all regulations and guidance promulgated
thereunder, to the extent applicable.
(g)	 Headings. Headings are given to the subsections of the Plan
solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation
of the Plan or any provision thereof.
SECTION 13
Term of the Plan

 	Subject to Section 10(a), no Awards may be granted under the Plan later
than ten years after the date the Plan was adopted by the Board; provided,
however, that Awards granted prior to such date shall remain in effect until
such Awards have either been satisfied, expired or canceled under the terms
of the Plan or the individual Award Agreement, and any restrictions imposed
on Shares in connection with their issuance under the Plan have lapsed.

SECTION 14
Liability and Indemnification

(a)	No Liability.  No member of the Board or the Committee or any
officer or employee of the Company or its subsidiaries shall be personally
liable for any act or failure to act, decision or determination made in good
faith in connection with the Plan hereunder, except in circumstances
involving his or her bad faith, gross negligence or willful misconduct.  By
participating in the Plan, each Participant agrees to release and hold
harmless the Company and its subsidiaries (and their respective directors,
officers and employees), the Board and the Committee from and against any tax
liability, including, but not limited to, interest and penalties, incurred by
the Participant in connection with his or her receipt of an Award and the
payment and exercise thereof.
(b)	Indemnification.  Each person who is or has been a member of the
Board or Committee will be indemnified and held harmless by the Company
against and from: (a) any loss, cost, liability or expense (including, but
not limited to, attorneys' fees) that may be imposed upon or reasonably
incurred by him or her in connection with or resulting from any claim,
action, suit or proceeding to which he or she may be a party or in which he
or she may be involved by reason of any action taken or failure to act under
the Plan or any Award Agreement; and (b) any and all amounts paid by him or
her in settlement thereof, with the Company's prior written approval, or paid
by him or her in satisfaction of any judgment in any such claim, action, suit
or proceeding against him or her; provided, however, that he or she must give
the Company an opportunity, at the Company's expense, to handle and defend
such claim, action, suit or proceeding before he or she undertakes to handle
and defend the same on his or her own behalf.  The foregoing right of
indemnification is not exclusive of any other rights of indemnification to
which such persons may be entitled under the Company's Articles of
Incorporation or Bylaws, by contract, as a matter of law or otherwise, or
under any power that the Company may have to indemnify them or hold them
harmless.
SECTION 15
Effective Date of the Plan

	The Plan shall become effective on May 13, 2009, the date of its
adoption by the Company's shareholders.

******

	The foregoing is the full text of the Stock Award Plan adopted by the
shareholders of Kentucky Bancshares, Inc. on May 13, 2009.











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