2005 OUTSIDE DIRECTOR STOCK COMPENSATION PROGRAM
UNDER THE
EMMIS COMMUNICATIONS CORPORATION
2004 EQUITY COMPENSATION PLAN

     
Section 1.
  Introduction and Purpose. To address business conditions and to further align
our directors’ interests with those of our shareholders Emmis Communications
Corporation is instituting this 2005 Outside Director Stock Compensation Program
(the “Program”) under the Emmis Communications Corporation 2004 Equity
Compensation Plan (the “Plan”).
 
   
Section 2.
  Award. Pursuant to the authority under the Plan, the Board of Directors hereby
authorizes and awards, effective on the first business day after the end of the
Award Year, Restricted Stock to Participants in accordance with the terms set
forth below (sometimes referred to as the “Award” or “Awards”).
 
   
Section 3.
  Definitions.
 
   

  “Award Year” means January 1, 2005 through December 31, 2005, and each
calendar year thereafter.
 
   

  “Board of Directors” means the Board of Directors of Emmis Communications
Corporation.
 
   

  “Company” means Emmis Communications Corporation.
 
   

  “Director” means a person who is a member of the Board of Directors.
 
   

  “Emmis” means Emmis Communications Corporation and its Subsidiaries, as
defined by the Plan, that are generally included in its United States’ payroll
system.
 
   

  “Emmis Stock”, “Share” or “Stock” means the Class A Common Stock of Emmis
Communications Corporation.
 
   

  “Initial Value” means the lower of (i) the VWAP on November 1, 2004 and
(ii) the VWAP on the first trading day immediately preceding the beginning of
the Award Year or (iii) the average VWAP during the first 45 days of that Award
Year.
 
   

  “Participant” means a Director who is not an employee of the Company or its
subsidiaries.
 
   

  “Plan” means the 2004 Equity Compensation Plan sponsored by the Company.
 
   

  “Program” means this 2005 Outside Director Stock Compensation Program.

 

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  “Program Compensation” means the sum of all directors fees payable to each
Participant during the Award Year in accordance with outside director
compensation policies in effect from time to time.
 
   

  “Restricted Stock” means the award of Stock issued under this Program.
 
   

  “Securities Trading Policy” means the policy established by the Board of
Directors of the Company from time to time that specifies, among other things,
the times when an Emmis employee may buy or sell Emmis Stock.
 
   

  “VWAP” means the Volume Weighted Average Price per share of Emmis Stock as of
the end of a trading day as calculated by Bloomberg, L.P. or such other
organization designated by the Company; provided, however, that if there are no
shares of Emmis Stock traded on the NASDAQ/NMS on such date, the VWAP shall mean
the volume weighted average price per share of Emmis Stock as of the end of the
previous trading day on which shares of Emmis Stock were traded on the
NASDAQ/NMS.
 
   
Section 4.
  Restricted Stock.

  (a)   Restricted Stock Agreement. Each Participant will receive a Restricted
Stock Agreement providing for the issuance of Restricted Stock to the
Participant after the end of the Award Year. Subject to the terms of the
Restricted Stock Agreement, the number of shares of Restricted Stock to be
issued to the Participant will equal the sum of Shares determined under
Subsection 4(b). Such Restricted Stock will be issued as soon as
administratively practicable after the end of the Award Year. So long as a
Participant is not in possession of material non-public information and the
Securities Trading Policy does not prohibit the Participant from buying or
selling Emmis Stock, the Participant may sell the Restricted Stock upon issuance
after the end of the Award Year. Pursuant to the authority under the Plan, the
purchase price for Restricted Stock under this Program shall be zero ($0) and
the Restricted Stock shall be issued with the restriction that the Restricted
Stock may not be used for “Share Withholding” under Section 17(a) of the Plan,
and without restriction as to resale.     (b)   Number of Shares. The number of
Shares of Restricted Stock awarded to a Participant under this Section shall
equal the Participant’s Program Compensation for the Award Year divided by the
Initial Value, provided that if the Participant has attended, in person or by
phone, at least 75% of all of the meetings of the Board of Directors and of any
Board of Directors’ Committees on which the Participant serves, the
Participant’s Program Compensation shall be divided by 80% of the Initial Value.
The actual number of Shares will be rounded up to the nearest full share.

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  (c)   Forfeiture.

  (i)   A Participant shall forfeit any and all rights under this Section and
the Company shall not issue any Restricted Stock hereunder if the Participant is
removed for Cause from the Board of Directors prior to the last day of the
applicable Award Year. In all other cases in which the Participant ceases to be
a Director, the number of Shares of Restricted Stock that Emmis will issue to
the Participant will be prorated based on the number of meetings during the
Award Year attended prior to the date the Participant ceased to be a Director.
If a Participant ceases to be a Director for any reason other than removal for
Cause, Emmis will deliver to the Participant or, in the event of death, the
Participant’s estate, a certificate for the prorated Shares of Emmis Stock
promptly after the Participant, or the Participant’s estate, pays Emmis any
applicable taxes and other withholdings as required by law.     (ii)   Solely
for purposes of grants of Restricted Stock under this Program, “Cause” means the
conviction of the Participant of (or the admission by the Participant of the
commission of ) any felony or other crime involving dishonesty, fraud or moral
turpitude, or the Participant’s habitual neglect of duties; provided that in
either event, the action involved must have had a detrimental effect on Emmis.

     
Section 5.
  Incorporation of Equity Incentive Plan by Reference. The adoption of this
Program is not an amendment to the Plan. Instead, it represents the exercise of
discretionary authority of the Board of Directors to make “Awards” of
“Restricted Stock” under Section 8 of the Plan by setting forth the terms and
conditions under which certain “Awards” are made under the Plan. All of the
terms and conditions of the Plan are incorporated by reference in this Program
and each Award hereunder
 
   
Section 6.
  Miscellaneous.

  (a)   Administration. The Compensation Committee of the Board of Directors or
its designee have the express authority under this Program to:

  (i)   carry out the general administration of the Program;     (ii)   cause to
be prepared all forms necessary or appropriate for the administration of the
Program;     (iii)   keep appropriate books and records;     (iv)   determine
amounts to be disbursed to Participants and others under the provisions of the
Program;     (v)   determine, consistent with the provisions of this instrument
and the Plan, all questions of eligibility, rights, and status of Participants
and others under this Program; and

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  (vi)   interpret, with discretionary authority, the provisions of this Program
and to resolve, with discretionary authority, all disputed questions of Program
interpretation and benefit eligibility, consistent with the terms of the
applicable Plan;

  (b)   Relationship. Notwithstanding any other provision of this Program, this
Program and action taken pursuant to it shall not be deemed or construed to
establish a trust or fiduciary relationship of any kind between or among Emmis,
the Participant, or any other persons.     (c)   Tax Withholding. The Company
may withhold from any payment due hereunder any taxes required to be withheld
under applicable federal, state, or local tax laws or regulations.     (d)   Tax
Liability. The Company does not expressly or impliedly guarantee any federal,
state or local tax consequences of participation in the Program.     (e)  
Amendment. The Board of Directors reserves to itself and the Compensation
Committee thereof, singly, the right to amend the Program at any time as it
deems appropriate in its sole discretion. No amendment shall reduce any benefits
accrued under the Program prior to the date the amendment was duly authorized.  
  (f)   Termination. The Board of Directors reserves to itself and the
Compensation Committee thereof, singly, the right to terminate the Program at
any time as it deems appropriate in its sole discretion.

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