UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 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): November 8, 2005
--------------------------------------------------------------------------------

                        UNITED TENNESSEE BANKSHARES, INC.
               (Exact Name of Registrant as Specified in Charter)


         Tennessee                  0-23551                     62-1710108
--------------------------------------------------------------------------------
(State or Other Jurisdiction of    (Commission              (I.R.S. Employer
Incorporation or Organization)     File Number)           Identification Number)


170 W. Broadway, Newport, Tennessee                           37821-0249
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                      (Zip Code)


       Registrant's telephone number, including area code: (423)623-6088

                                      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 (see General Instruction A.1. below):

[ ]  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 CFR 240.14d-2(b))

[ ]  Pre-commencement   communications   pursuant  to  Rule  13e-4(c)  under the
     Exchange Act (17 CFR 240.13e-4(c))

<PAGE>

Item 4.02  Non-Reliance on Previously  Issued Financial  Statements or a Related
Audit Report or Completed Interim Review.

     (b) On  November  8, 2005,  management  and the audit  committee  of United
Tennessee  Bankshares,  Inc.  ("UTBI"),  in  consultation  with its  independent
registered  public  accounting firm, Pugh & Company,  P.C.,  determined that the
Company did not correctly  record the expense  associated with the repurchase of
its common stock from  employees and directors for the years ended  December 31,
2003 and 2004 and the interim period ended June 30, 2005.

     UTBI has consistently applied APB Opinion No. 25 in accounting for its 1999
Stock Option Plan. When stock options were issued, the amount of the options and
the exercise  price was fixed,  and the exercise price was in excess of the fair
market value of the stock on the date granted.  Accordingly, UTBI did not record
any  compensation  cost when the stock  options were issued.  In 2003,  2004 and
2005,  stock options were exercised by employees and directors and the stock was
immediately repurchased by United Tennessee Bankshares, Inc. UTBI had previously
repurchased  stock  using its Stock  Option Plan Trust to provide for the shares
needed when the options were exercised. The cost of these repurchased shares was
recorded in a  contra-equity  account called "Stock Option Plan Contra  Account"
which  reduced  shareholders'  equity.  When the options were  exercised and the
stock  repurchased  in 2003,  2004 and 2005,  the cost  basis of the  shares was
adjusted in the Stock Option Plan Contra Account.  After further research of APB
Opinion No. 25 and related interpretation FIN 44, management has determined that
the amount of cash paid to employees and  directors  should have been charged to
expense, net of any statutory federal or state tax withholding and payroll taxes
paid from the proceeds.

     As a result, net income previously reported was overstated by the following
approximate amounts for the following periods:

         Year Ended December 31, 2003; between $325,000 and $350,000
         Year Ended December 31, 2004; between $275,000 and $300,000
         Six Month Period Ended June 30, 2005; between $75,000 and $100,000

     Total shareholders'  equity will not be affected by the restatement for the
amounts  shown  above.   The   restatements   will  change   components   within
shareholders' equity such as retained earnings, stock option plan contra account
and common  stock,  but the total for  shareholders'  equity  will remain at the
amounts previously reported.

     UTBI intends to restate its previously issued financial  statements for the
above-mentioned reporting periods.


Item 8.01 Other Events.

     UTBI  has  announced  that  its  Annual  Meeting  of the  Shareholders  was
adjourned on Thursday,  November 10, 2005. The management and audit committee of
UTBI,  in  consultation  with  the  Company's   independent   registered  public
accounting  firm, Pugh & Company,  P.C., have recently  determined that the UTBI
did not  correctly  record the expense  associated  with the  repurchase  of its
common stock from  employees and directors for the years ended December 31, 2003
and 2004 and the interim  period ended June 30,  2005,  and such expense will be
restated by UTBI.  The Company  wants to ensure that the  shareholders  have the
corrected  information  and  sufficient  time to evaluate their vote in light of
this information.

     UTBI will amend  certain of its filings  with the  Securities  and Exchange
Commission to reflect this corrected information.

     Revised proxy  materials and a new proxy will be mailed to  shareholders as
soon as reasonably possible.
<PAGE>


Item 9.01 Financial Statements and Exhibits.

         (d) Exhibit 99.1 - Press release dated November 11, 2005.






<PAGE>


                                   Signatures

     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 hereunto duly authorized.


                                        UNITED TENNESSEE BANKSHARES, INC.

Dated:   November 14, 2005              By:/s/ Richard G. Harwood
                                        -------------------------------------
                                        Richard G. Harwood
                                        President and Chief Executive Officer
                                        (Duly Authorized Representative)







<PAGE>


                                                                   EXHIBIT 99.1

For Immediate Release
November 11, 2005
Contact: Richard G. Harwood, President and CEO
Phone: (423) 623-6088


    United Tennessee Bankshares, Inc. Announces Adjournment of Annual Meeting

     UTBI  announced  today that its  Annual  Meeting  of the  Shareholders  was
adjourned on Thursday,  November 10, 2005. The management and audit committee of
UTBI,  in  consultation  with  the  Company's   independent   registered  public
accounting  firm, Pugh & Company,  P.C., have recently  determined that the UTBI
did not  correctly  record the expense  associated  with the  repurchase  of its
common stock from  employees and directors for the years ended December 31, 2003
and 2004 and the interim  period ended June 30,  2005,  and such expense will be
restated by UTBI.  The Company  wants to ensure that the  shareholders  have the
corrected  information  and  sufficient  time to evaluate their vote in light of
this information.

     UTBI has consistently applied APB Opinion No. 25 in accounting for its 1999
Stock Option Plan. When stock options were issued, the amount of the options and
the exercise  price was fixed,  and the exercise price was in excess of the fair
market value of the stock on the date granted.  Accordingly, UTBI did not record
any  compensation  cost when the stock  options were issued.  In 2003,  2004 and
2005,  stock options were exercised by employees and directors and the stock was
immediately repurchased by United Tennessee Bankshares, Inc. UTBI had previously
repurchased  stock  using its Stock  Option Plan Trust to provide for the shares
needed when the options were exercised. The cost of these repurchased shares was
recorded in a  contra-equity  account called "Stock Option Plan Contra  Account"
which  reduced  shareholders'  equity.  When the options were  exercised and the
stock  repurchased  in 2003,  2004 and 2005,  the cost  basis of the  shares was
adjusted in the Stock Option Plan Contra Account.  After further research of APB
Opinion No. 25 and related interpretation FIN 44, management has determined that
the amount of cash paid to employees and  directors  should have been charged to
expense, net of any statutory federal or state tax withholding and payroll taxes
paid from the proceeds.

     As a result, net income previously reported was overstated by the following
approximate amounts for the following periods:

         Year Ended December 31, 2003; between $325,000 and $350,000
         Year Ended December 31, 2004; between $275,000 and $300,000
         Six Month Period Ended June 30, 2005; between $75,000 and $100,000

     Total shareholders'  equity will not be affected by the restatement for the
amounts  shown  above.   The   restatements   will  change   components   within
shareholders' equity such as retained earnings, stock option plan contra account
and common  stock,  but the total for  shareholders'  equity  will remain at the
amounts previously reported.

     UTBI intends to restate its previously issued financial  statements for the
above-mentioned reporting periods.

     UTBI will amend  certain of its filings  with the  Securities  and Exchange
Commission to reflect this corrected information.

     Revised proxy  materials and a new proxy will be mailed to  shareholders as
soon as reasonably possible.
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 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): November 8, 2005
--------------------------------------------------------------------------------

                        UNITED TENNESSEE BANKSHARES, INC.
               (Exact Name of Registrant as Specified in Charter)

         Tennessee                  0-23551                     62-1710108
--------------------------------------------------------------------------------
(State or Other Jurisdiction of    (Commission              (I.R.S. Employer
Incorporation or Organization)     File Number)           Identification Number)

170 W. Broadway, Newport, Tennessee                           37821-0249
--------------------------------------------------------------------------------
(Address of Principal Executive Offices)                      (Zip Code)

       Registrant's telephone number, including area code: (423)623-6088

                                      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 (see General Instruction A.1. below):

[ ]  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 CFR 240.14d-2(b))

[ ]  Pre-commencement   communications   pursuant  to  Rule  13e-4(c)  under the
     Exchange Act (17 CFR 240.13e-4(c))
Item 4.02  Non-Reliance on Previously  Issued Financial  Statements or a Related
Audit Report or Completed Interim Review.

     (b) On  November  8, 2005,  management  and the audit  committee  of United
Tennessee  Bankshares,  Inc.  ("UTBI"),  in  consultation  with its  independent
registered  public  accounting firm, Pugh & Company,  P.C.,  determined that the
Company did not correctly  record the expense  associated with the repurchase of
its common stock from  employees and directors for the years ended  December 31,
2003 and 2004 and the interim period ended June 30, 2005.

     UTBI has consistently applied APB Opinion No. 25 in accounting for its 1999
Stock Option Plan. When stock options were issued, the amount of the options and
the exercise  price was fixed,  and the exercise price was in excess of the fair
market value of the stock on the date granted.  Accordingly, UTBI did not record
any  compensation  cost when the stock  options were issued.  In 2003,  2004 and
2005,  stock options were exercised by employees and directors and the stock was
immediately repurchased by United Tennessee Bankshares, Inc. UTBI had previously
repurchased  stock  using its Stock  Option Plan Trust to provide for the shares
needed when the options were exercised. The cost of these repurchased shares was
recorded in a  contra-equity  account called "Stock Option Plan Contra  Account"
which  reduced  shareholders'  equity.  When the options were  exercised and the
stock  repurchased  in 2003,  2004 and 2005,  the cost  basis of the  shares was
adjusted in the Stock Option Plan Contra Account.  After further research of APB
Opinion No. 25 and related interpretation FIN 44, management has determined that
the amount of cash paid to employees and  directors  should have been charged to
expense, net of any statutory federal or state tax withholding and payroll taxes
paid from the proceeds.

     As a result, net income previously reported was overstated by the following
approximate amounts for the following periods:

         Year Ended December 31, 2003; between $325,000 and $350,000
         Year Ended December 31, 2004; between $275,000 and $300,000
         Six Month Period Ended June 30, 2005; between $75,000 and $100,000

     Total shareholders'  equity will not be affected by the restatement for the
amounts  shown  above.   The   restatements   will  change   components   within
shareholders' equity such as retained earnings, stock option plan contra account
and common  stock,  but the total for  shareholders'  equity  will remain at the
amounts previously reported.

     UTBI intends to restate its previously issued financial  statements for the
above-mentioned reporting periods.

Item 8.01 Other Events.

     UTBI  has  announced  that  its  Annual  Meeting  of the  Shareholders  was
adjourned on Thursday,  November 10, 2005. The management and audit committee of
UTBI,  in  consultation  with  the  Company's   independent   registered  public
accounting  firm, Pugh & Company,  P.C., have recently  determined that the UTBI
did not  correctly  record the expense  associated  with the  repurchase  of its
common stock from  employees and directors for the years ended December 31, 2003
and 2004 and the interim  period ended June 30,  2005,  and such expense will be
restated by UTBI.  The Company  wants to ensure that the  shareholders  have the
corrected  information  and  sufficient  time to evaluate their vote in light of
this information.

     UTBI will amend  certain of its filings  with the  Securities  and Exchange
Commission to reflect this corrected information.

     Revised proxy  materials and a new proxy will be mailed to  shareholders as
soon as reasonably possible.
Item 9.01 Financial Statements and Exhibits.

         (d) Exhibit 99.1 - Press release dated November 11, 2005.
Signatures

     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 hereunto duly authorized.

                                        UNITED TENNESSEE BANKSHARES, INC.

Dated:   November 14, 2005              By:/s/ Richard G. Harwood
                                        -------------------------------------
                                        Richard G. Harwood
                                        President and Chief Executive Officer
                                        (Duly Authorized Representative)
EXHIBIT 99.1

For Immediate Release
November 11, 2005
Contact: Richard G. Harwood, President and CEO
Phone: (423) 623-6088

    United Tennessee Bankshares, Inc. Announces Adjournment of Annual Meeting

     UTBI  announced  today that its  Annual  Meeting  of the  Shareholders  was
adjourned on Thursday,  November 10, 2005. The management and audit committee of
UTBI,  in  consultation  with  the  Company's   independent   registered  public
accounting  firm, Pugh & Company,  P.C., have recently  determined that the UTBI
did not  correctly  record the expense  associated  with the  repurchase  of its
common stock from  employees and directors for the years ended December 31, 2003
and 2004 and the interim  period ended June 30,  2005,  and such expense will be
restated by UTBI.  The Company  wants to ensure that the  shareholders  have the
corrected  information  and  sufficient  time to evaluate their vote in light of
this information.

     UTBI has consistently applied APB Opinion No. 25 in accounting for its 1999
Stock Option Plan. When stock options were issued, the amount of the options and
the exercise  price was fixed,  and the exercise price was in excess of the fair
market value of the stock on the date granted.  Accordingly, UTBI did not record
any  compensation  cost when the stock  options were issued.  In 2003,  2004 and
2005,  stock options were exercised by employees and directors and the stock was
immediately repurchased by United Tennessee Bankshares, Inc. UTBI had previously
repurchased  stock  using its Stock  Option Plan Trust to provide for the shares
needed when the options were exercised. The cost of these repurchased shares was
recorded in a  contra-equity  account called "Stock Option Plan Contra  Account"
which  reduced  shareholders'  equity.  When the options were  exercised and the
stock  repurchased  in 2003,  2004 and 2005,  the cost  basis of the  shares was
adjusted in the Stock Option Plan Contra Account.  After further research of APB
Opinion No. 25 and related interpretation FIN 44, management has determined that
the amount of cash paid to employees and  directors  should have been charged to
expense, net of any statutory federal or state tax withholding and payroll taxes
paid from the proceeds.

     As a result, net income previously reported was overstated by the following
approximate amounts for the following periods:

         Year Ended December 31, 2003; between $325,000 and $350,000
         Year Ended December 31, 2004; between $275,000 and $300,000
         Six Month Period Ended June 30, 2005; between $75,000 and $100,000

     Total shareholders'  equity will not be affected by the restatement for the
amounts  shown  above.   The   restatements   will  change   components   within
shareholders' equity such as retained earnings, stock option plan contra account
and common  stock,  but the total for  shareholders'  equity  will remain at the
amounts previously reported.

     UTBI intends to restate its previously issued financial  statements for the
above-mentioned reporting periods.

     UTBI will amend  certain of its filings  with the  Securities  and Exchange
Commission to reflect this corrected information.

     Revised proxy  materials and a new proxy will be mailed to  shareholders as
soon as reasonably possible.