Employment Agreement - Expedia Inc. and Richard Barton


[LOGO OF EXPEDIA INC.]                                             EXHIBIT 10.13


[DRAFT]
October 25, 1999


Richard Barton
3522 46th Avenue NE
Seattle, WA  98105


Dear Rich:

Expedia, Inc. is excited to offer you the opportunity to join our new company in
the position of Chief Executive Officer.  This offer is conditioned upon and
subject to the execution by Expedia, Inc. of an initial public offering (IPO).
The date of the anticipated IPO is tentatively set for November 1999, but could
occur later. As a condition of this offer, your start date with Expedia, Inc.
must be no later than the IPO date.  As a further condition of employment with
Expedia, Inc., you will be required to sign an Expedia, Inc. Employee Agreement,
a copy of which is enclosed with this letter.

In the event that an Expedia, Inc. public offering does not take place for any
reason by June 30, 2000, this conditional offer of employment is void.
Microsoft informs us that, in that event, in lieu of becoming employed by
Expedia, Inc. you will have the opportunity to continue your employment with
Microsoft Corporation.

Subject to the above contingencies and the terms and conditions stated below,
your exact start date with Expedia, Inc. is still to be determined but is at
present estimated to occur just prior to the anticipated IPO in the November
1999 timeframe.  For purposes of Expedia, Inc. vacation accrual and 401(k)
vesting only, your service date with Expedia, Inc. would  be 5/28/91,
recognizing your employment period with Microsoft. We trust you will treat the
details of this offer with utmost confidentiality.

As an Expedia, Inc. employee, your compensation and benefits package would be as
follows:

     Your annual base salary would be $165,000, equivalent to approximately
     $13,750 per month. The performance review schedule for Expedia, Inc. has
     not yet been established and is subject to change, but we anticipate you
     would first be eligible for a salary merit increase opportunity during the
     summer of 2000.  Concurrently with your salary review, you would also be
     considered for a 0-15% bonus opportunity. Any subsequent salary and/or
     bonus review would occur according to the performance review timetable and
     eligibility practices in place for Expedia, Inc. employees at that time.
     Any salary increase and bonus would be based on your performance and
     subject to your satisfaction of eligibility criteria.

     Expedia, Inc would provide a company benefits program that would include
     the opportunity to participate in an Expedia, Inc. 401(k) savings plan and
     an Expedia, Inc. Employee Stock Purchase Plan.  Further details of the
     Expedia, Inc. benefits program

 
     will be provided to you once the program is finalized and in place. Please
     note that some portions of the Expedia, Inc. benefit program may not be in
     place as of your start date and/or may be subject to change. If you are
     currently participating as a Microsoft employee in Microsoft Corporation's
     401(k) Plan and/or Employee Stock Purchase Plan, Microsoft has informed us
     that you would be permitted to continue your participation in those Plans
     through the period ending December 31, 1999, provided of course that you
     continue to meet the eligibility criteria for those Microsoft Plans.

     Upon becoming an employee of Expedia, Inc., any outstanding Microsoft
     Corporation stock options granted to you as a Microsoft employee would be
     handled as follows.  Any and all Microsoft options previously granted to
     you that are vested and exerciseable as of your start date with Expedia,
     Inc. would remain vested and exerciseable as Microsoft options through the
     life, and subject to all the terms and conditions, of the applicable
     Microsoft grant agreement, Microsoft Stock Option Plan(s), and the
     administrative policies adopted pursuant to the Microsoft Stock Option
     Plan(s). Any and all Microsoft options previously granted to you that are
     unvested as of your start date with Expedia, Inc. would be irrevocably
     exchanged for and replaced by Expedia, Inc. options dated as of the IPO
     date, at which time the actual price and number of Expedia, Inc. shares
     would be determined.  At the time of this exchange, all your unvested
     Microsoft options would be canceled, and you would be issued Expedia, Inc.
     options having an aggregate "in-the-money value" (the difference between
     the exercise price and the market price of the underlying stock) equivalent
     to the aggregate in-the-money value of your unvested Microsoft stock
     options as of the IPO date. The number and exercise price of these new
     Expedia, Inc. stock options would be established using an exchange ratio
     based upon the IPO price of Expedia, Inc. shares and the closing price of
     Microsoft stock on the day before the IPO date. Further, these exchange
     options from Expedia, Inc. would be non-qualified options granted under and
     subject to the terms and conditions of the Expedia, Inc. 1999 Stock Option
     Plan, the Expedia, Inc. Stock Option Agreement issued under that Plan, and
     any administrative policies adopted pursuant to that Plan. The Expedia,
     Inc. exchange options will vest according to the same vesting schedule that
     would have applied to the exchanged unvested Microsoft stock options had
     those Microsoft options not canceled; however, the Expedia, Inc. exchange
     options will be subject to a restriction preventing exercise of any vested
     portion of the options for a period of 180 days after the IPO date.
     Additional information regarding the Expedia, Inc. stock option, including
     the Stock Option Agreement you would be required to sign as a condition of
     receiving the option, would be provided to you approximately 60 days after
     your grant price has been determined.  In addition, as a condition of
     commencing employment with Expedia, Inc. and receiving the Expedia, Inc.
     exchange options described above, you will be required to sign an agreement
     regarding the cancellation of your unvested Microsoft options.


Please recognize that this offer letter is not a contract of employment for any
minimum or specific period and that the employment Expedia, Inc. offers you is
terminable at will.  This means that our employment relationship is voluntary
and based on mutual consent and that either you or Expedia, Inc. can decide to
end the relationship at any time, for any reason, with or without cause.
However, if your employment with Expedia, Inc. terminates during the first two
(2) years after your hire date for either of the following two reasons, you will
nonetheless receive as severance benefits upon your termination from Expedia,
Inc. the salary and stock option vesting you would have received from 

 
Expedia, Inc. had you remained employed with us for a period of two years from
your Expedia, Inc. hire date:


.  If your salary or job ladder level are reduced without your consent and you
   terminate as a result during the first two years, you will receive the above
   referenced severance benefits;

.  If there is a material, non-consensual diminution of your authority, title or
   scope of responsibility during the first two years, you will receive the
   above referenced severance benefits.


As a condition of and in consideration for your receipt of the above referenced
severance benefits, you will be required to sign a full and final release of any
and all claims arising from or related in any way to your employment with or
separation from Expedia, Inc.  No severance benefits shall be paid if you are
terminated for misconduct, as defined below, or if you voluntarily resign for
any reason other than the two reasons set forth above.  As used in this letter,
the term "misconduct" shall mean your commission of a crime or any other
intentional misconduct on your part that has a material adverse effect upon the
business or reputation of Expedia, Inc.

Please note that the terms stated in this letter constitute a one-time offer to
transition your employment from Microsoft to Expedia, Inc.  Should you decline
this offer and subsequently receive and accept an offer to join Expedia, Inc. at
a later time, any such future offer would be governed by separate terms as may
be offered at that time, and the terms stated in this letter will not apply.

This offer is contingent on your providing Expedia, Inc. with proof of U.S.
citizenship or alien work permission as required under federal regulations.

In order to accept all the terms and conditions of this offer as stated above,
please sign the enclosed copy of this letter and return it to me in the enclosed
envelope.  You may keep the original of this letter for your records.

We look forward to your contribution to the success of Expedia, Inc. and hope
you will join us.  Should you have any questions, please give me a call.


Sincerely,                               ACCEPTANCE:


                                         _____________________________
                                         NAME


Greg Maffei                              _____________________________
President                                DATE
Expedia, Inc.



Enclosure:  Expedia, Inc. Employee Agreement