Exhibit
      10.2





AMES
      NATIONAL CORPORATION


Ames,
      Iowa





**AMES
      NATIONAL CORPORATION STOCK PURCHASE PLAN**


Effective
      1999 through 2008





August
      10, 2005





GENERAL:


The
      shareholders of the Ames National Corporation (Company) approved a resolution
      on
      January 27, 1999, renewing the existing stock purchase plan for a ten-year
      period, which included a broader group of employees and added limited
      participation by non-officer members of the Board of Directors.





OBJECTIVE:


To
      encourage equity interests by officers, employees, and directors which provides
      additional incentive to improve banking performance and retain qualified
      individuals.





ELIGIBILITY:


Participants
      shall include all full-time Company and subsidiary banks’ (Banks) employees with
      three years of service and all current Company and Bank supervisors, officers,
      and members of the Boards of Directors. The eligibility requirements concerning
      length of employment will be determined as of December 31st of the preceding
      year. For the purpose of this plan, full-time participation will require 1,800
      hours of service. The three years of service need not be consecutive.
      Eligibility will not include employees, officers, or directors who are not
      in
      the employ of the Company or Banks as of June 15th.





DISTRIBUTION:


The
      total
      number of shares available each year shall be 42,000 with each non-officer
      director eligible to purchase up to 240 shares annually. The remaining shares
      will be allocated based upon the percentage of each participant’s compensation
      to total compensation of employees, supervisors, and officers.





PRICE:


The
      purchase price shall be determined annually by an independent appraiser as
      of
      March 31st unless there is ample evidence of current market transactions
      including NASDAQ or similar market pricing.





In
      the
      event there is ample evidence of current market transactions, the fair market
      value of the stock shall be determined by the average of the closing prices
      on
      the last three days on which there was trading activity up to and including
      June
      8th.





Participants
      and their allocated shares will be certified at the May meeting of the Board
      of
      Directors together with the purchase price (as previously described) to be
      in
      effect for the purchase of shares at the first business day prior to June
      16th.





ADMINISTRATION
      OF PLAN:


The
      plan
      shall be administered by the Compensation Committee (the "Committee") of the
      Board of Directors of the Company. The Committee shall designate a person (the
      "Plan Coordinator") who shall coordinate the actions and information between
      Plan Participants and the Company.





PLAN
      MODIFICATION AND TERMINATION:


The
      Plan
      will continue from year to year through 2008, but may be modified, suspended
      or
      discontinued at any time by the Company's Board of Directors.





CONCLUSION:


This
      Plan
      is intended to clarify the Resolution presented to the Ames National Corporation
      shareholders on January 27, 1999, to provide information to current and
      prospective employees, officers, and directors, and to aid in administering
      the
      stock purchase plan.