CEO Employment Agreement

LOGO OF EXPEDIA INC.]







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 thi s 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 oppor tunity 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 tr eat 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 ...