EMPLOYMENT AGREEMENT

     This  EMPLOYMENT  AGREEMENT (the  "Agreement")  is effective as of March 1,
2003, by and between EMMIS OPERATING COMPANY, an Indiana corporation ("Employer"
or "Emmis"), and GARY A. THOE, an Indiana resident ("Executive").

                                    RECITALS

     WHEREAS,  Employer and its  subsidiaries  are engaged in the  ownership and
operation  of certain  radio and  television  stations,  magazines,  and related
operations; and

     WHEREAS,  Employer  desires  to  employ  Executive  as  an  executive,  and
Executive desires to be so employed.

     NOW, THEREFORE, in consideration of the foregoing,  the mutual promises and
covenants  set  forth  in  this  Agreement,  and for  other  good  and  valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties, intending to be legally bound, hereby agree as follows:

                                    AGREEMENT

     1.  Employment  Status.  Upon the terms and subject to the  conditions  set
forth in this Agreement, Employer hereby employs Executive, and Executive hereby
accepts exclusive employment with Employer.

     2. Term.  The term of  Executive's  employment  shall  commence on March 1,
2003, and continue until  February 28, 2006 (the "Term").  This Agreement  shall
expire at the end of the Term unless earlier  terminated in accordance  with the
terms of this  Agreement.  For purposes of this  Agreement,  the term  "Contract
Year" shall be defined to mean each twelve (12) month period commencing on March
1,  2003,  and on each  anniversary  thereof  during the Term.  The term  "First
Contract Year" shall refer to the period commencing on March 1, 2003, and ending
on  February  29,  2004;  "Second  Contract  Year"  shall  refer  to the  period
commencing on March 1, 2004,  and ending on February 28, 2005;  "Third  Contract
Year"  shall  refer to the period  commencing  on March 1,  2005,  and ending on
February 28, 2006.

     3. Executive's Position, Duties and Authority.


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          3.1 Position.  Employer shall employ  Executive,  and Executive  shall
     serve as an  executive  of  Employer,  and of any  successor of Employer by
     merger,  acquisition  of  substantially  all  of the  assets  or  stock  of
     Employer,  or  otherwise.  Executive  shall serve as President - Publishing
     Division or shall serve in such other senior management  positions to which
     Employer may appoint Executive.

          3.2 Duties and Authority. Executive shall have such duties, functions,
     authority  and  responsibilities  as are  commensurate  with the  office(s)
     Executive holds with the Employer during the Term.

          3.3  Directorships  and Other  Offices.  If  Executive is elected as a
     Director of Emmis Communications Corporation, Executive shall serve in such
     position  without  additional  remuneration  but shall be  entitled  to the
     benefit  of  indemnification  pursuant  to  the  terms  of  Section  15.11.
     Executive  shall  also serve  without  remuneration  as a  director  and/or
     officer  of one  or  more  of  Employer's  subsidiaries  or  affiliates  if
     appointed to such position(s) by Employer.

     4.  Full-Time  Services.  Executive's  services  pursuant to this Agreement
shall be  performed  on a  full-time  and  exclusive  basis  in a  professional,
diligent and competent  manner to the best of Executive's  abilities.  Executive
shall not undertake any outside  employment or outside business activity without
the prior written consent of Employer;  provided,  however, that Executive shall
be permitted to serve on the board of charitable or other civic organizations so
long as such services do not interfere with  Executive's  duties and obligations
pursuant to this Agreement.

     5.  Location  of  Employment;  Travel.  The  location  for  performance  of
Executive's  services hereunder shall be the Employer's  headquarters offices in
Indianapolis,  Indiana. Executive shall undertake such travel as the performance
of Executive's duties pursuant to this Agreement may require.

     6. Compensation.

6.1 Base  Salary.  Employer  shall pay or cause to be paid to  Executive  a base
salary in the amount of Two  Hundred  Fifty  Five  Thousand  Dollars  ($255,000)
(subject to withholding for applicable  taxes and as otherwise  required by law)
(the "Base  Salary")  each  Contract  Year during the Term.  Employer  shall pay
Executive the Base Salary according to Employer's  customary payroll  practices.

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Executive  acknowledges  and  agrees  that:  (i)  Employer  may pay a portion of
Executive's  Base Salary (not to exceed ten percent  (10%)  without  Executive's
prior written  consent) in Shares (as defined below)  pursuant to a plan adopted
for Emmis employees or for other executive-level  officers of Employer; and (ii)
ten percent  (10%) of any Base Salary paid  pursuant to this  Agreement is being
paid in consideration of Employer's  exclusive rights set forth in Section 10 of
this Agreement.

          6.2 Annual Incentive  Compensation.  For each Contract Year during the
     Term,  Executive  shall be eligible  to receive one (1) annual  performance
     bonus up to a target  amount of One  Hundred  Thousand  Dollars  ($100,000)
     (subject to withholding for applicable  taxes and as otherwise  required by
     law) (each,  a "Contract  Year Bonus"),  the exact amount of which shall be
     determined by means of Executive's  attainment of certain performance goals
     as  determined  each  Contract  Year by the  Compensation  Committee of the
     Employer's  Board of Directors (the  "Compensation  Committee").  Executive
     acknowledges  and agrees  that,  as a material  condition  to  receiving  a
     Contract Year Bonus,  as of the end of each  respective  Contract Year: (i)
     this  Agreement  must be in effect and not  previously  terminated  for any
     reason  (other  than a breach  of this  Agreement  by  Employer);  and (ii)
     Executive must be fully  performing  Executive's  duties and obligations as
     required  hereunder and shall not be in breach of any of the material terms
     and  conditions of this  Agreement.  It is understood and agreed that Emmis
     may, at its sole election,  pay any Contract Year Bonus, if any, in cash or
     Shares.  In the event Emmis  elects  pursuant to this  Section 6.2 to pay a
     Contract Year Bonus in Shares,  the exact number of Shares to be awarded to
     Executive  shall be  determined  by dividing the total dollar amount of the
     applicable  Contract Year Bonus by the average of the reported high and low
     Share  price on a  valuation  date to be used by  Employer  in  determining
     similar cash incentive  compensation awards for other members of Employer's
     senior management team (the "Valuation  Formula").  Any Contract Year Bonus
     amounts  earned by Executive  pursuant to the terms and  conditions of this
     Section 6.2 shall be awarded promptly following  Employer's fiscal year end
     earnings  release or at such other  time as annual  incentive  compensation
     awards are made to other members of Employer's  senior management team (but
     in no event  later  than  ninety  (90)  days  after the  expiration  of the
     applicable Contract Year).

          6.3 Equity  Incentive  Compensation.  On or about the  commencement of
     each  Contract  Year during the Term,  or at any other time or times during
     each  Contract  Year when  Employer  generally  awards  Options (as defined
     below) to members of Employer's  senior  management  team,  Executive shall
     receive an option to acquire  Fifteen  Thousand  (15,000) shares of Class A
     Common Stock of Emmis Communications Corporation (the "Shares") pursuant to
     the terms and subject to the conditions of the applicable  Equity Incentive
     Plan of Employer (each,  an "Option").  It is understood and agreed that in
     the  event  of any  change  in the  outstanding  Shares  by  reason  of any
     reorganization,  recapitalization,  stock split, reverse stock split, stock
     dividend,  share  combination,  consolidation  or similar event,  including
     without  limitation a Separation  Event (as defined below),  the number and
     class of Shares awarded  pursuant to this Agreement or covered by an Option
     granted  pursuant to this Section 6.3 and any  applicable  Option  exercise

<PAGE>

     price  shall  be  adjusted  by  the  Compensation  Committee  in  its  sole
     discretion  and in  accordance  with  the  terms of the  applicable  Equity
     Incentive Plan of Employer and the Option agreement evidencing the grant of
     the  Option.  The  determination  of the  Compensation  Committee  shall be
     conclusive and binding.

          6.4.  Auto  Allowance.  During  the Term,  Executive  shall  receive a
     monthly  auto  allowance  in the amount of One  Thousand  Dollars  ($1,000)
     (subject to withholding for applicable  taxes and as otherwise  required by
     law)  consistent  with  Employer's   policy  or  practice   regarding  such
     allowances,  as such policy or practice may be changed or  eliminated  from
     time to time  during  the Term in  Employer's  sole  discretion;  provided,
     however,  that in no event  shall the amount paid to  Executive  under this
     Section 6.4 be reduced.

     7. Business  Expenses.  Employer  shall pay or reimburse  Executive for all
reasonable  expenses  actually  incurred by Executive  during the Term  directly
related to the performance of Executive's  services  hereunder upon presentation
of  expense  statements,  vouchers  or  similar  documentation,  or  such  other
supporting information as Employer may require of Executive.

     8.  Fringe  Benefits  and  Vacation.  During the Term,  Executive  shall be
entitled  to four (4)  weeks of paid  vacation  in  accordance  with  Employer's
applicable  policies and procedures  for  executive-level  employees.  Executive
shall also be  eligible  to  participate  in and  receive  the  fringe  benefits
generally  made  available  to other  executive-level  employees  of Employer in
accordance  with the general  provisions of Employer's  fringe  benefit plans or
programs;  provided,  however that Executive understands that these benefits may
be increased,  changed, eliminated or added from time to time during the Term as
determined in Employer's sole and absolute discretion.

     9. Confidential Information.

          9.1  Non-Disclosure.  Executive  acknowledges that certain information
     concerning  the  business  of  Employer  is  of a  proprietary  and  highly
     confidential  nature,  and that as a result of Executive's  employment with
     Employer,  Executive has received and developed, and will hereafter receive
     and continue to develop,  proprietary  and other  confidential  information
     concerning the business of Employer and its subsidiaries which, if known to
     competitors of Employer, would damage Employer, its subsidiaries, and their
     respective businesses.  Accordingly, Executive agrees that, during the Term
     and thereafter,  Executive shall not divulge or appropriate for Executive's
     own use, or for the use or benefit of any third party (other than  Employer
     or its representatives or as specifically  directed in writing by Employer)
     any information or knowledge  concerning the business of Employer or any of
     its subsidiaries which is not generally  available to the public other than
     through the  activities of Executive.  Executive  further  agrees that upon

<PAGE>

     termination  of  Executive's  employment  for any reason,  Executive  shall
     promptly  surrender  to  Employer  all  documents,   brochures,   writings,
     illustrations,  price lists,  marketing  plans,  budgets and any other such
     materials (regardless of form or character) that Executive received from or
     developed on behalf of Employer in connection with  Executive's  employment
     prior to or during the Term. Executive acknowledges that all such materials
     shall remain at all times during and after the expiration or termination of
     the Term for any reason the sole and  exclusive  property of Employer,  and
     that  nothing  in this  Agreement  shall be deemed to grant  Executive  any
     right, title or interest in such material.

          9.2 Injunctive Relief. Executive acknowledges that: Executive's breach
     of Section  9.1 will cause  irreparable  harm and damage to  Employer,  the
     exact amount of which will be difficult to ascertain;  that the remedies at
     law for any such breach would be  inadequate;  and that the  provisions  of
     this Section 9 have been  specifically  negotiated and carefully written to
     prevent  such  irreparable  harm  and  damage.  Accordingly,  if  Executive
     breaches  Section  9.1,  Employer  shall be entitled to  injunctive  relief
     enforcing  Section  9.1 to  the  extent  reasonably  necessary  to  protect
     Employer's legitimate interests, without posting bond or other security.

     10. Non-Interference and Non-Competition; Injunctive Relief.

          10.1  Non-Interference.  During  the Term and for a period  of two (2)
     years immediately  thereafter (the "Restrictive  Period"),  Executive shall
     not,  directly or  indirectly,  take any action (or permit any action to be
     taken by an entity with which Executive is associated in a management role)
     which  has  the  effect  of  interfering   with   Employer's   relationship
     (contractual  or  otherwise)  with any  employee  of Employer or any of its
     subsidiaries,   affiliates  or  related  entities.   Without  limiting  the
     generality of the foregoing, during the Restrictive Period, Executive shall
     refrain  from,  either  directly  or  indirectly,   soliciting,   inducing,
     recruiting  or  encouraging  any of  Employer's  employees  to leave  their
     employment  with  Employer  or any of  Employer's  subsidiaries  either for
     Executive's  benefit or on behalf of or for the benefit of any other person
     or entity.

          10.2 Exclusive Employment and Non-Competition.  Executive acknowledges
     the special and unique nature of Executive's  employment with Employer as a
     member of Employer's  senior  management  team, and understands  that, as a
     result of  Executive's  employment  with  Employer  prior to and during the
     Term,  Executive has gained and will continue to gain knowledge of and have
     access  to  highly  sensitive  and  valuable   information   regarding  the
     operations  of  Employer  and its  subsidiaries  and  affiliated  entities,

<PAGE>

     including  but  not  limited  to the  proprietary  and  other  confidential
     information  described  more fully in Section 9.1.  Accordingly,  Executive
     acknowledges  Employer's  special  interest in preventing the disclosure of
     such information  through the engagement of Executive's  services by any of
     Employer's competitors following the expiration or early termination of the
     Term for any reason. Therefore,  Executive agrees that, during the Term and
     for a period of twelve (12) months immediately  following the expiration or
     early termination of the Term for any reason,  Executive shall not, without
     the prior written  approval of Employer,  engage  directly or indirectly in
     services for, or become employed by, serve as an agent or consultant to, or
     become an officer,  director,  partner,  principal or  shareholder  of, any
     corporation,  partnership  or other entity which is engaged in the magazine
     publishing  business  in any  city in  which  Employer  operates  or has an
     interest in any magazine. So long as Executive does not engage in any other
     activity  prohibited by the  immediately  preceding  sentence,  Executive's
     ownership  of less than five  percent  (5%) of the issued  and  outstanding
     stock of any corporation whose stock is traded on an established securities
     market shall not  constitute  competition  with Employer for the purpose of
     this Section 10.2.

          10.3 Injunctive  Relief.  Executive  acknowledges  and agrees that the
     provisions  of  this  Section  10 have  been  specifically  negotiated  and
     carefully  worded  in  recognition  of the  opportunities  which  shall  be
     afforded  to  Executive  by  Employer  by virtue of  Executive's  continued
     association  with  Employer and the influence  that  Executive has and will
     continue  to  have  over  Employer's  employees,   customers  and  vendors.
     Executive further acknowledges that:  Executive's breach of Section 10.1 or
     10.2 will cause  irreparable harm and damage to Employer,  the exact amount
     of which will be difficult to  ascertain;  that the remedies at law for any
     such breach would be inadequate; and that the provisions of this Section 10
     have been  specifically  negotiated  and carefully  written to prevent such
     irreparable injury and damage.  Accordingly,  if Executive breaches Section
     10.1 or 10.2,  Employer  shall be entitled to injunctive  relief  enforcing
     Section  10.1  or  10.2  to the  extent  reasonably  necessary  to  protect
     Employer's legitimate interests, without posting bond or other security. If
     Executive  violates  Section 10.1 or 10.2 and Employer  brings legal action
     for injunctive or other relief, Employer shall not, as a result of the time
     involved in obtaining  such relief,  be deprived of the benefit of the full
     period  of  non-interference   and/or  non-competition  set  forth  herein.
     Accordingly,  the  obligations  set forth in Section 10.1 and 10.2 shall be
     deemed to have the duration set forth therein,  computed from the date such
     relief is granted  but  reduced by the time  expired  between  the date the
     restrictive  period began to run and the date of the first violation of the
     obligations by Executive.

          10.4  Construction.  Despite  the  express  agreement  herein  between
     Employer and  Executive,  in the event that any of the provisions set forth
     in this Section 10 shall be  determined  by any court or other  tribunal of
     competent  jurisdiction to be unenforceable for any reason whatsoever,  the
     parties agree that this Section 10 shall be  interpreted  to extend only to
     the maximum extent as to which it may be enforceable, and that this Section
     10 shall be severable into its component  parts,  all as determined by such
     court or tribunal.


<PAGE>




     11. Termination of Agreement.

          11.1  Termination  of Agreement  by Employer  for Cause.  Employer may
     terminate this Agreement and Executive's employment hereunder for Cause (as
     defined in Section 11.3 below) in accordance  with the terms and conditions
     of this Section 11.  Following a  determination  by Employer that Executive
     should be  terminated  for Cause,  Employer  shall give  written  notice to
     Executive  specifying the grounds for such  termination  (the  "Preliminary
     Notice"),  and  Executive  shall  have five (5) days  after  receipt of the
     Preliminary  Notice to respond in writing.  If following the  expiration of
     such  five  (5)  day  period  Employer  reaffirms  its  determination  that
     Executive  should  be  terminated  for  Cause,  such  termination  shall be
     effective  upon  delivery  by Employer to  Executive  of a final  notice of
     termination (the "Final Notice").

          11.2  Effect of  Termination  by Employer  for Cause.  In the event of
     termination for Cause as provided in Section 11.1 above:

               (i) Executive  shall have no further  obligations  or liabilities
          hereunder,  except  Executive's  obligations  under  Section 9 and 10,
          which shall survive the termination of this Agreement.

               (ii) Employer  shall have no further  obligations  or liabilities
          hereunder,  except that Employer  shall,  not later than two (2) weeks
          after the termination date:

                    (a) Pay to Executive  all unpaid Base Salary with respect to
               any  applicable  pay period  ending on or before the  termination
               date; and

                    (b) Pay to Executive any Contract Year Bonus,  if any, which
               Executive  earned for a Contract  Year  ending on or prior to the
               termination  date  pursuant to Section 6.2 but which is unpaid as
               of the termination date.

          11.3  Definition  of Cause.  For purposes of this  Agreement,  "Cause"
     shall be defined to mean any of the  following:  (i) any action or omission
     by Executive  involving willful or repeated failure,  neglect or refusal to
     perform any of Executive's  duties or obligations  under this Agreement (or
     any  duties  assigned  to  Executive  consistent  with  the  terms  of this
     Agreement) or abide by any applicable policy of Employer,  and continuation
     of such breach after  written  notice and the  expiration of a ten (10) day
     cure period; provided,  however, that it is not the parties' intention that
     Employer shall be required to provide  successive such notices,  and in the
     event Employer has provided Executive with a notice and opportunity to cure
     pursuant to this Section 11.3,  Employer may terminate this Agreement for a
     subsequent  breach  similar or  related to the breach for which  notice was
     previously given or for a continuing series or pattern of breaches (whether
     or not similar or related)  without  providing  notice or an opportunity to
     cure;  (ii)  Executive's  commission  of  any  felony  or any  other  crime
     involving an act of moral turpitude;  (iii) Executive's action or omission,
     or knowing allowance of actions or omissions, which are in violation of any
     law or the rules and regulations of the Federal  Communications  Commission

<PAGE>

   (the "FCC"), or which otherwise jeopardize the licenses granted to Employer
     or any of Employer's  subsidiaries  or  affiliates  in connection  with the
     ownership or operation of any radio or  television  station;  (iv) theft in
     any amount;  (v) actual or threatened  violence  against another  employee;
     (vi) sexual or other prohibited  harassment of others;  (vii)  unauthorized
     disclosure or use of proprietary or confidential information,  as described
     more fully in Section 9.1;  (viii) any action which brings  Employer or any
     of Employer's  subsidiaries or affiliates into public disrepute,  contempt,
     scandal  or  ridicule;  and (ix)  any  matter  constituting  cause or gross
     misconduct under applicable laws.

          11.4 Change in  Control.  In the event of a "Change in  Control",  the
     rights and  obligations  of Executive and Employer  shall be set forth in a
     separate  Change of Control  Agreement  to be  executed by the parties in a
     form  acceptable to Employer and  thereafter  attached to this Agreement as
     Exhibit A.  "Change in Control"  shall have the  meaning  ascribed to it in
     Exhibit A. Notwithstanding  anything to the contrary contained herein or in
     Exhibit A, a Change in Control  shall be deemed  not to have  occurred  if,
     immediately following a Separation Event or the transaction or transactions
     described in the  definition of Change of Control in Exhibit A: (i) Jeffrey
     H. Smulyan  ("Smulyan") is Chairman or Chief Executive  Officer of Employer
     or any successor  thereto,  including  without  limitation,  the Publishing
     Division  or any  entity  established  as a result  of a  Separation  Event
     (collectively, "Successor"); or (ii) Smulyan retains the ability to vote at
     least fifty  percent  (50%) of all classes of stock of the  Employer or any
     Successor;  or (iii) Smulyan retains the ability to elect a majority of the
     Board of  Directors  of Employer  or any  Successor.  For  purposes of this
     Section 11.4,  "Separation  Event" shall be defined to mean any endeavor by
     Employer to separate or  bifurcate  its radio,  television  and  publishing
     divisions by means of merger, corporate reorganization, sale or disposition
     of assets, spin off, tax-free reorganization, or otherwise

     12. Disability.

          12.1 Termination of Employment. If Executive shall become Disabled (as
     defined in Section 12.2),  Employer shall continue to compensate  Executive
     under the terms of this Agreement without  diminution and otherwise without
     regard to such disability or  nonperformance  of duties until Executive has

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    been  disabled  for a  cumulative  period of six (6) months,  at which time
     Employer  may,  in its  sole  discretion,  elect to  terminate  Executive's
     employment. If Employer elects to terminate Executive's employment pursuant
     to this Section 12.1, the date that Executive's employment terminates shall
     be referred to herein as the "Disability Termination Date."

          12.2  Definition  of  Disability.  Executive  shall be  deemed to have
     become  "Disabled"  for  purposes of this  Agreement  if,  during the Term,
     because of ill health,  physical or mental disability,  or for other causes
     beyond Executive's reasonable control,  Executive shall have been unable to
     perform  Executive's  duties  hereunder  as  reasonably   determined  by  a
     reputable physician selected by Employer.

          12.3  Obligations  after  Termination.  Unless Employer  exercises its
     option under Section 12.5 below to reinstate  Executive to Executive's full
     compensation,  duties, functions,  responsibilities and authority hereunder
     for the  balance  of the  original  Term,  Executive  shall have no further
     obligations or liabilities  hereunder after a Disability  Termination  Date
     except Executive's  obligations under Sections 9 and 10 which shall survive
     the termination of the Term. After a Disability  Termination Date, Employer
     shall have no  further  obligations  or  liabilities  hereunder  except its
     obligations  under Section 12.4 which shall also survive the termination of
     the Term.

          12.4 Payment of Unpaid Amounts after Termination.  Employer shall, not
     later  than two (2)  weeks  after a  Disability  Termination  Date,  pay to
     Executive: (i) all unpaid Base Salary with respect to any pay period ending
     on or before the Disability  Termination  Date; plus (ii) any Contract Year
     Bonus,  if any,  earned by Executive for a Contract Year ending on or prior
     to the  Disability  Termination  Date  pursuant to Section 6.2 but which is
     unpaid as of the Disability  Termination Date;  provided,  however,  in the
     event a  Disability  Termination  Date occurs at least six (6) months after
     the commencement of a Contract Year during the Term,  Employer shall pay to
     Executive a pro-rated  portion of the Contract  Year Bonus for the Contract
     Year during which the Disability Termination Date occurs, such amount to be
     determined in the sole discretion of Employer,  so long as Executive is not
     reinstated during such Contract Year pursuant to Section 12.5.

          12.5  Reinstatement.  If during the original Term and  subsequent to a
     Disability   Termination  Date,   Executive  shall  fully  recover  from  a
     disability,  Employer shall have the right  (exercisable  within sixty (60)
     days after written  notice from  Executive of such  recovery),  but not the
     obligation,  to reinstate Executive to employment hereunder for the balance
     of the original  Term. In the event of such  reinstatement,  Employer shall
     pay  Executive at  Executive's  full level of  compensation  hereunder  and
     otherwise  employ  Executive in accordance with the terms and provisions of
     this Agreement.


<PAGE>



          12.6 No Reduction.  Amounts payable  pursuant to this Section 12 shall
     not be reduced by the value of any benefits  payable to Executive under any
     disability insurance plan or policy.

     13. Death of Executive.

          13.1   Termination  of  Agreement.   This  Agreement  shall  terminate
     immediately  upon  Executive's  death.  In the  event of such  termination,
     Employer shall have no further obligations or liabilities  hereunder except
     its  obligations   under  Section  13.2  below  which  shall  survive  such
     termination.

          13.2 Compensation.  Employer shall, not later than two (2) weeks after
     Executive's  date  of  death,  pay  to  Executive's  estate  or  designated
     beneficiary:  (i) all unpaid  Base  Salary  with  respect to any pay period
     ending on or before  Executive's date of death; plus (ii) any Contract Year
     Bonus,  if any,  earned by Executive for a Contract Year ending on or prior
     to Executive's date of death pursuant to Section 6.2 but which is unpaid as
     of Executive's date of death;  provided,  however, in the event Executive's
     date of death  occurs at least six (6) months after the  commencement  of a
     Contract Year during the Term,  Employer shall pay to Executive's estate or
     designated  beneficiary a pro-rated  portion of the Contract Year Bonus for
     the Contract Year during which Executive's death occurs,  such amount to be
     determined in the sole discretion of Employer.

          13.3 No Reduction.  Amounts payable  pursuant to this Section 13 shall
     not be reduced by the value of any benefits  payable to Executive's  estate
     or designated  beneficiaries  under any  applicable  life insurance plan or
     policy.

          13.4 Death after  Termination.  In the event that Executive dies after
     termination of this Agreement pursuant to Section 11, 12 or 13, all amounts
     required to be paid by Employer  prior to  Executive's  death in connection
     with such  termination  that remain unpaid as of Executive's  date of death
     shall be paid to Executive's estate or designated beneficiary.

     14.  Notices.  All notices,  requests,  consents and other  communications,
required or permitted to be given hereunder,  shall be made in writing and shall
be deemed to have been duly  given if  delivered  personally  or sent by prepaid
telegram,  or mailed  first-class,  postage prepaid,  by registered or certified
mail, as follows (or to such other or  additional  address as either party shall
designate by notice in writing to the other in accordance herewith):


<PAGE>




         (i)  If to Employer:
                  Emmis Communications Corporation
                  40 Monument Circle
                  Suite 700
                  Indianapolis, Indiana 46204
                  Attn.:   David O. Barrett, Esq.

                 With a copy to:

                  Gary L. Kaseff, Esq.
                  15821 Ventura Blvd.
                  Suite 685
                  Encino, California 91436

          (ii) If to Executive,  to Executive's address on the personnel records
     of Employer.

     15. Miscellaneous.

          15.1  Governing  Law.  This  Agreement  shall be  deemed  to have been
     entered  into in the  State of  Indiana  and  shall  be  governed  by,  and
     construed and enforced in accordance with, the laws of the State of Indiana
     without regard to its choice of law provisions.

          15.2  Arbitration.  The parties agree that any controversy or claim of
     either  party  hereto  arising  out  of or in  any  way  relating  to  this
     Agreement,  or  breach  thereof,  shall be  settled  by final  and  binding
     arbitration  in  Indianapolis,  Indiana in accordance  with the  applicable
     rules of the American Arbitration Association (AAA), and that judgment upon
     any award  rendered  may be  entered by the  prevailing  party in any court
     having jurisdiction  thereof.  The parties agree to share equally all costs
     associated with the arbitration;  provided,  however, that each party shall
     be  solely  responsible  for  its  own  attorneys'  fees  and  expenses  in
     connection with any such arbitration.

          15.3 Captions. The section headings contained herein are for reference
     purposes only and shall not in any way affect the meaning or interpretation
     of any of the terms or conditions of this Agreement.

          15.4 Entire Agreement;  Merger. This Agreement (including all exhibits
     referenced  in  this  Agreement)  sets  forth  the  entire   agreement  and
     understanding  of the parties  relating to the subject matter  herein,  and
     supersedes all prior agreements,  arrangements and understandings,  written
     or oral, between the parties, which are merged herein.


<PAGE>


          15.5 Successors and Assigns.  This Agreement,  and Executive's  rights
     and  obligations  hereunder,  may not be assigned by Executive  without the
     prior written consent of Employer, which consent may be granted or withheld
     in  Employer's  sole  and  absolute  discretion;  provided,  however,  that
     Executive may designate  pursuant to Section 15.7 one or more beneficiaries
     to receive  any  amounts  that would  otherwise  be  payable  hereunder  to
     Executive's  estate.  Employer  may assign all or any portion of its rights
     and obligations  hereunder to any subsidiary,  affiliate or related entity,
     or any third party by way of merger,  corporate  reorganization  (including
     without limitation a Separation Event), acquisition of substantially all of
     the assets or stock of Employer, or otherwise.

          15.6 Amendments;  Waivers. This Agreement cannot be changed,  modified
     or amended,  and no provision or requirement hereof may be waived,  without
     the written consent of Executive and Employer.  The failure of either party
     at any time or times to require  performance of any provision  hereof shall
     in no manner affect the right of such party at a later time to enforce such
     provision.  No  waiver  by a party of the  breach  of any term or  covenant
     contained in this Agreement, whether by conduct or otherwise, in any one or
     more  instances,  shall be  deemed  to be, or  construed  as, a further  or
     continuing waiver of any such breach or a waiver of the breach of any other
     term or covenant contained in this Agreement.

          15.7  Beneficiaries.  Whenever this Agreement provides for any payment
     to Executive's estate, such payment may be made instead to such beneficiary
     or  beneficiaries  as Executive may have designated in a writing filed with
     Employer. Executive shall have the right to revoke any such designation and
     to  re-designate  a  beneficiary  or  beneficiaries  by  written  notice to
     Employer (and to any applicable insurance company).

          15.8 Executive's  Warranty and Indemnity.  Executive hereby represents
     and warrants  that  Executive:  (i) has the full and  unqualified  right to
     enter into and fully  perform  this  Agreement  according to each and every
     term and condition  contained herein;  and (ii) has not made any agreement,
     contractual obligation,  or commitment in contravention of any of the terms
     and  conditions  of this  Agreement or which would prevent  Executive  from
     performing  according to any of the terms and conditions  contained herein.
     Furthermore,  Executive  hereby agrees to fully indemnify and hold harmless
     Employer and each of its subsidiaries, affiliates and related entities, and
     each of their respective officers, directors, employees, agents, attorneys,
     insurers and  representatives  (the "Emmis Group") from and against any and
     all  losses,  costs,  damages,  expenses  (including  attorneys'  fees  and

<PAGE>

     expenses),  liabilities and claims,  arising out of, in connection with, or
     in any way related to Executive's  breach of any of the  representations or
     warranties  contained in this Section 15.8 or Executive's  breach of any of
     the material terms or conditions contained in this Agreement.

          15.9  No  Obligation  to  Utilize  Services.  Employer  shall  not  be
     obligated to utilize  Executive's  services nor use the results or products
     of such  services even if Executive is not in default  hereunder.  Employer
     may at  any  time  during  the  Term,  for  any  reason,  elect  not to use
     Executive's  services or have any further  obligations  to Executive  under
     this Agreement except as provided in the next sentence.  If Employer elects
     not to use  Executive's  services as permitted  herein,  Executive shall be
     paid Executive's full  compensation as described more fully in Section 6 at
     the times and in the  installments  as provided  herein as if Executive had
     fulfilled Executive's obligations hereunder through the Term.

          15.10  Change in Fiscal  Year.  If Employer  changes its fiscal  year,
     Employer  shall make such  adjustments  to the  various  dates and  amounts
     included  herein  or in  any  plan  or  program  referenced  herein  as are
     necessary or appropriate; provided, however, that the end of the Term shall
     in no event be  extended  beyond the  expiration  of the Term  without  the
     written consent of the parties.

          15.11  Indemnification.  Executive shall be entitled to the benefit of
     the indemnification provisions set forth in Employer's Amended and Restated
     Articles of  Incorporation  and/or  By-Laws,  or any  applicable  corporate
     resolution,  as the same may be amended  from time to time  during the Term
     (not  including any limiting  amendments  or  additions,  but including any
     amendments or additions that add to or broaden the  protection  afforded to
     Executive at the time of execution of this Agreement) to the fullest extent
     permitted by applicable law.  Additionally,  Employer shall cause Executive
     to be  indemnified  in accordance  with Chapter 37 of the Indiana  Business
     Corporation Law (the "IBCL"),  as the same may be amended from time to time
     during the Term, to the fullest extent permitted by the IBCL as required to
     make Executive  whole in connection  with any  indemnifiable  loss, cost or
     expense  incurred in  Executive's  performance  of  Executive's  duties and
     obligations pursuant to this Agreement. Employer shall also maintain during
     the Term an insurance policy providing  directors' and officers'  liability
     coverage in a commercially  reasonable  amount.  It is understood  that the
     foregoing  indemnification  obligations  shall  survive the  expiration  or
     termination of the Term.


<PAGE>


     IN WITNESS WHEREOF,  the parties,  intending to be legally bound, have duly
executed this Agreement as of the date first written above.

                     EMMIS OPERATING COMPANY
                     ("Employer")



                     By:      /s/ Jeffrey H. Smulyan
                                   Jeffrey H. Smulyan
                              Chairman of the Board and Chief Executive Officer


                     GARY A. THOE
                     ("Executive")


                     /s/ Gary A. Thoe
                          Gary A. Thoe




<PAGE>



                                                     EXHIBIT A












                                                 [TO BE PROVIDED]