Jerry Leshne – SVP, IR Michael Roth – Chairman and CEO Frank Mergenthaler – EVP and CFO

Alexia Quadrani – JP Morgan Matt Chesler – Deutsche Bank Peter Stabler – Credit Suisse Dan Salmon – BMO Capital Markets David Bank – RBC Capital Markets Meggan Friedman – William Blair Ben Swinburne – Morgan Stanley James Dix – Wedbush

Good morning and welcome to the Interpublic Group fourth quarter and full year 2009 earnings conference call. All parties are in a listen-only mode until the question-and-answer portion. (Operator instructions) This conference is being recorded. If you have any objections, you may disconnect at this time. I would now like to introduce Mr. Jerry Leshne, Senior Vice President of Investor Relations. Sir, you may begin.

Thank you. Good morning. Thank you for joining us. We have posted our earnings release and our slide presentation on our website interpublic.com, and we'll refer to both in the course of this call. This morning we are joined by Michael Roth and Frank Mergenthaler. We will begin with prepared remarks to be followed by Q&A. We plan to conclude before our market open at 9:30 am Eastern. During this call we will refer to forward-looking statements about our company, which are subject to uncertainties and the cautionary statement included in our earnings release and the slide presentation and further detailed in our 10-K and other filings with the SEC. At this point, it is my pleasure to turn things over to Michael Roth.

Thank you Jerry, and thank you all for joining us, especially in this difficult weather environment. I guess similar to our credo of our good clients at US Post Office. I will review the results for the quarter and full year 2009. I will begin by covering the headlines relating to our performance and how we see the year ahead. Frank will then take you through the financial results in detail. After his remarks, I will return with some agency specific observations and closing comments before we move on to the Q&A. As you can see, the very tough economic environment resulted in an organic revenue decrease for the year of 10.8%. Notwithstanding, we were able to deliver operating income of $340 million and operating margin, excluding incremental severance was 6.9%. It bears mention that the high level of severance in the fourth quarter reflects softer than anticipated revenue in Europe and Japan, and the fact that we weren’t satisfied with 2010 run rates in those regions as we moved through our planning process late last year. Earnings per diluted share were $0.19. Looking at the quarter, the organic revenue decline of 8.2% represented a sequential improvement from the previous six months. This result is in keeping with our public comment since the October conference call in which we have consistently been clear that we think the worst of the recession’s impact on our business has passed. Economic conditions appear to have stabilized, and we believe that we should see improvement during the course of 2010. It is likely that progress won’t be linear, but it is fair to say that it is a good time for our clients to refocus on building for the future and investing in their brands. Overall, I would characterize the tone of the business as one of tempered optimism, especially for the second half of 2010. But we have begun to see clients reengage with many of our project driven marketing service companies, and there is also a greater willingness on the part of our clients to commit to annual spending plans that wasn't the case at the end of last year. As you remember, we indicated to you that even in a flat organic environment this year, we would be in a strong position to recoup much of the margin progress made from 2006 to 2008, and then continue building on that momentum in the years to come. Those are goals we continue to believe are readily achievable. Another item of note as we review last year's performance is the degree to which our long-standing conservative approach of the balance sheet again proves to be on target. We have been building a strong financial foundation for the business for a number of years, and in 2009 we made further strides in extending our debt maturity profile, and enhancing the company's cash position. Furthermore, we continue to demonstrate our ability to effectively manage costs. For the full year, expenses were down significantly as we took over $500 million of costs out of our business. I have mentioned previously that it is not possible in such a steep downturn to cut costs in line with revenue declines and not damage the quality of the services we deliver. Nonetheless, we are pleased at the way in which our management teams around the world responded to the business conditions that prevailed last year. We acted quickly and decisively to address both fixed and variable costs. We took hard decisions on costs and did so consistently throughout the year. These actions will be critical in allowing us to return the margin improvement trajectory we were on prior to the economic downturn. It bears mention that we were able to accomplish this, while continuing to build on the quality of the talent and capabilities at our various agencies. I will have more to say about the performance of our agencies and the competitiveness of our service offering later on the call. But at the macro level, it is gratifying to point out that we are at the table winning our fair share of all major account reviews, and that our agencies are receiving a degree of industry recognition across all marketing disciplines. That clearly positions us for an eventual media and advertising recovery. With that, I've now hand things over to Frank for an in-depth look at our results.

Good morning. As a reminder, I will be referring to the slide presentation that accompanies our website as available on our website. Before turning to the presentation, I would underscore that during the quarter we continue to be aggressive in managing our cost, which resulted in more extensive headcount reduction than we anticipated coming out of Q3. As a result of the actions in the quarter and the year, we began 2010 with the reduction in headcount of approximately 11% compared to a year ago. The managed severance expense in our operating results therefore grew commensurately. Severance was 71 million in Q4 and 166 million for the year. Excluding year-over-year incremental severance of 77 million, full year operating margins were 6.9%, which is consistent with our expectations coming out of the third quarter. That said, our structural expense improvement goes beyond headcount. While I will have more detail on Q4 expenses in a few minutes, it is worth highlighting that we moved into 2010 with a broadly disciplined cost base. The investments we have made over the last few years in talent and in tools for business insight and control will provide even greater operating leverage as market conditions improve. I would also add that we concluded the year with strong cash flow from operations, well-managed working capital and in a strong position with respect to our balance sheet and liquidity. We ended with 2.5 billion of cash and marketable securities compared with 2.3 billion a year ago, while retiring approximately 200 million net debt during the year. Diluted EPS in Q4 was $0.24 per share compared with $0.39 a year ago. For the full year that comparison is $0.19 per share compared to $0.52. Turning to slide three, you can see our P&L for the quarter. I will cover revenue and operating expenses in detail in the slides that follow. Other income was 29 million in the quarter. Approximately half of this amount was due to the expiration and settlement of certain liabilities that have been recognized in our 2004 statement with the remainder related to the sales and investments held in employee benefit trust. Turning to a closer look of operations on slide four beginning with revenue. Revenue in the quarter was 1.8 billion, a decrease of 5.3%. Compared to Q4 2008 exchange rates had a positive impact of 2.9%. The impact of acquisitions and divestitures was de minimis. Our organic revenue change was a decrease of 8.2%, primarily the result of client reductions and scope, industry fee pressure, and some lost assignments. In terms of client sectors, the top performers were retail, which increased from a year ago, packaged goods, health and personal care and financial services. It is worth noting that while auto decreased from a year ago the pace of decline slowed from Q2 and Q3. Each of the sector changes I just mentioned also showed improvement sequentially compared to Q3. Tech and telecom continued to weigh on our top line, reflecting lost assignments and generalized spending weakness in the sector. Revenue was somewhat stronger than we anticipated coming into the quarter. The organic change was less negative compared to the first nine months of the year, against softer prior year performance, and showed improvement from October to November, November to December. Relative to our expectations among our main agency groups, we had the strongest outperformance in media, our US independent agencies, and at Draftfcb. At our event business, which faced something of a perfect storm during the past year, the decrease moderated against softer results a year ago, and revenue grew outside the US. Regionally, the US performed better than international as a whole with significant variance by international markets. I will have more detail in a moment. On the bottom half of this slide, you can see the revenue performance of our operating segments. At our integrated agency networks, the organic change was negative 8% the domestic performance approximately 2% better than outside the US. We were led by media brands, Draftfcb, and the strengthening at our US independents. At our CMG segment, Q4 revenue decreased 9.7% organically. Here again the US decreased less than international. Our PR discipline [ph] decreased mid-single digits organically as the rate decrease slowed in events, as I mentioned, while branding continued to be a difficult area. Slide five provides a breakdown of revenue by region. As you can see, spending reductions by multinational clients and in local project assignments continued to cross our major markets in the quarter. In the US, the organic decrease was 7.3%. The largest driver continued to be decreased spending from existing clients. Auto continued to weigh on domestic results, while lost assignments in the technology sector were also a factor. We were encouraged to see increases at several units in the US, including media brands, Lowe & Deutsch, Draftfcb, and Hill Holliday. Results included new business revenue due to account wins in digital and media disciplines and in the healthcare sector. Internationally revenue decreased 3%, which includes a significant lift in currency in the quarter. The organic decrease was 9.2%. In the UK, Q4 revenue decreased 4.5% organically. Performance was led by growth at media brands and Jack Morton. This was offset by pressure across other businesses due to decreased client spending as well as some lost assignments. While our Q4 comparison in the UK showed improvement from the prior nine months, our outlook here in the near term remains fundamentally cautious. In continental Europe, our organic decrease was 14.6%. In Asia-Pac, where we have a large Japan presence, it was 11.5%. In Latin America 7.1%. Performance in all three markets was due to factors I already mentioned. Our other markets regions decreased 2% organically, which reflects the timing of certain project revenue in the prior year’s quarter, which had no impact in the full year-over-year comparison. On slide six, we present a longer view of organic revenue growth and tracks equivalent 12 month performance. As you can see, we are pleased to get 2009 behind us. On slide seven, we take a closer look at operating expenses. Throughout the year, our financial priorities have been to align cost with revenue, protect margin to the extent possible and position ourselves to resume strong margin expansion as marketers’ conviction in the strength of the economic recovery takes hold. In Q4, operating expenses before the restructuring decreased 6.5% organically. Excluding incremental severance decreased 8%. For the full year operating expenses decreased 8.3% organically and decreased 9.6%, excluding the incremental severance. Q4 salaries and related expense 1.05 billion compared with 1.08 billion a year ago, a decrease of 2.6% and 6.3% organically. Excluding incremental severance, salaries and related expense decreased 8.4% organically. Importantly, base salaries and benefits and tax decreased 10% organically as a result of headcount actions taken over the preceding four quarters, and decreased 30 basis points as a percentage of revenue. Severance expense was 71 million compared with 48 million a year ago or 3.9% of Q4 revenue, compared with 2.5% a year ago. These expenses are the upfront cost of aligning headcount with revenue as well as structural investments in productivity that will pay back in 2010 and beyond. As I mentioned earlier, as the quarter developed, we remained aggressive with headcount actions focused on markets in Europe, Japan as well as the US. Full year severance was $166 million. Since the fourth quarter of 2008, headcount actions have addressed 14% of our workforce. Incentive expense in Q4 was 2.9% of revenue compared with 2.3% a year ago. The comparison primarily reflects lower equity related long-term incentive expense in Q4 2008. For the full year, reflecting overall performance incentive expense decreased 25%. Temporary labor expense decreased to 3% in Q4 and was 2.8% of revenue compared with 2.7% a year ago. For the full year expense for temporary labor decreased 24%. Turning to office and general expense on the lower half of the slide, O&G was 475 million in Q4, a decrease of 1.9%, while the organic decrease was 7%. O&G expenses were at 26.4 of revenue in the quarter, and for the full year O&G decreased to 28.5% of revenue from 28.9%. Occupancy expense was 7.6% of revenue compared with 6.9% a year ago due to lower revenue in 2009. We continued to act on opportunities to lower and contain lease expense around the world, including lease restructurings and improved utilization across all our agencies. In 2009, we were able to reduce square footage by approximately 5% despite softness in real estate markets around the globe. Professional fees were 2.1% of Q4 revenue the same level as a year ago. We reduced professional fees by 20 million for the full year. Travel, office supplies and telecom expenses were 3.4% of revenue compared with 3.9% in Q4 08. This was an area of procurement focus throughout the year, which contributed to a 28% decrease, 85 million for the full year. Our all other category decreased 5.5% organically in Q4 and was 13.3% of revenue compared with 12.6% a year ago. The comparison includes the timing of certain project expenses in the prior year’s quarter that had no effect in the full year-over-year comparisons, as well as currency gains in Q4 08 that did not repeat. On slide eight, we show our operating margin history on a trailing 12 month basis. Given the magnitude of the recession, we gave back some of the gains made in ’08, but margin expansion to a fully competitive level remains one of our primary financial objectives. On slide nine, you can see our debt maturity schedule as of the end of the year. Debt totaled 1.9 billion, a reduction of approximately 200 million during 2009. As indicated, the 214 million that remains of our floating rate notes mature in November of this year. We remain confident that we are positioned to again use cash on hand to deliver this year. Two related items that are not shown here, but are worth noting. With the conclusion of the fourth quarter, we are pleased to add a dedicated letter credit facility. The new facility is sized at 45 million pounds or approximately $72 million. It allows us to move a portion of the LC supported by our revolving credit facility, which further enhances our total available liquidity. At year end, we had a total of 95 million of letters of credit outstanding, and in January the moved 60 million to the new facility. As a reminder, we have never drawn on our current revolving credit facility, and we have no plans to do so. Also in January, we received the full support of our bank group for mending two covenants in our revolving credit facility in light of the 2009 operating environment and severance expense. The leverage covenant was expanded to allow debt-to-EBITDA of 3.75 times through March 31 and subsequently steps down. We concluded the year at 3.47. The minimum EBITDA requirement was also adjusted by $30 million to 520 million through March 31, after which it steps up. For 2009, our actual covenant EBITDA was 561 million. The new EBITDA level is conservative and precautionary in our view, and there is nothing in our 2010 operating plan that would test that level. Details of the covenants are available in our filings, and the related year end calculations also appear in the presentation appendix. Turning to the current portion of our balance sheet on slide 10, we ended the year with 2.5 billion in cash and short-term marketable securities, which despite the very challenging year is an increase of 200 million from a year ago. As I mentioned, we used 200 million net in 2009 to retire debt. On slide 11, we turn to cash flow. This is a full year presentation. The fourth quarter is in the presentation appendix. For the year, cash flow from operations was 541 million compared with 865 million in 2008 with the change due to mainly decrease in net income. Cash from working capital changes was 99 million, a strong result for the year in a challenging operating environment. Our performance was due to our focus on working capital management, and the growth of certain of our businesses notably in Q4. The seasonality of our business means we typically see strong cash generation from working capital in the fourth quarter, and related to that build, we typically see seasonal use in working capital that follows in Q1. Investing activities used 128 million compared with 250 million in 2008. Capex was 67 million, well below our historic levels. Financing activities used 267 million, which mainly reflects our redemption of the 2009 and 2011 maturities, and a portion of our 2010 offset by the issuance of our new 2017 notes. The net increase in cash and marketable securities for the year was 231 million. In summary, on slide 12 the quarter continued to reflect marketers’ decisions to rein in spending in 2009. Since the broader economic tone is still cautious, we will continue to manage our business conservatively as we move into 2010 with a continued focus on cost containment. Our teams will continue to execute aggressively on expense management in order to support our positioning for the strong profit growth that we believe is achievable as the economy picks up. Our financial resources remain strong. During the year we reduced debt, extended our maturity profile, added a new letter of credit facility, and increased our cash position, which has enhanced our liquidity and our financial flexibility. Now to talk about the state of our agency brands and our outlook for the year, I like to turn it back over to Michael.

Thank you Frank. As you can tell, we have just come through an extremely challenging year. The pressure that the recession placed on our clients has significant effects on the marketing activity, and therefore on our revenue. Our financial performance reflected this, but it also showed the strong focus on cost discipline brought to bear by our management teams across the organization. We successfully consolidated much of the margin progress made in recent years, and continued to hold our conservative approach to the balance sheet. Equally important during 2009, we saw further confirmation that the strategic decisions we have been taking in recent years are positioning the company for long-term competitiveness and growth. Full-year performance at Draftfcb was very strong on both top and bottom line. This further validated the move we made to create a new agency that brings together marketing accountability, and creativity in a media neutral model. There was also continued strong improvement in other areas of the business that we have been focusing on such as media brands, which performed particularly well in the fourth quarter. In the US, the combination of Lowe & Deutsch is tracking well, and should give that network the ability to participate in more multinational new business opportunities. Our global PR agencies, Weber Shandwick and GolinHarris, keep on delivering industry-leading work to their clients, including growing digital capabilities. This is what allows them to consistently gain share and outperform their peers. Our US independents, particularly the Martin Agency and Hill Holiday also posted strong results in spite of the economic challenges, as did our outstanding digital specialists, R/GA, and HUGE. We saw ample recognition of this progress and important year-end rankings released by the leading trade publications. The Martin Agency, R/GA, and UM swept the Adweek "Agency of the Year" awards in the US creative, US Media, and digital categories. Martin and UM also appeared in the Ad Age "A-List" along with Draftfcb and (inaudible), one of the very few times a PR agency as ever made this list. It doesn't seem fair to put in a year's work for all these honors and not get acknowledged on our call, I have to mention that Deutsch, R/GA, Gotham, and HUGE also appeared in Ad Age’s list of up and coming agencies. You remember that last year Initiative was a big winners in these awards, which coupled with UM’s honors this year explains why MediaPost named Mediabrands unit as the Media Holding Company of the Year for 2009. This performance was outstanding among our peers and particularly notable, because it included companies from across the full range of our portfolio. It shows that we are very much in the game when it comes to the competitors of our offerings, that we can build on the recent momentum in new business arena, and that we are well positioned to grow when economic recovery begins to take hold. It is also important to mention news at our largest unit, the McCann World Group. While it felt much of the impact of our issues in the tech and auto sectors last year, World Group continues to have a very powerful global network, and a full range of leading-edge services that include advertising, events, promotion and activation, as well as CRM and digital, where they posted a significant recent win at GM that speaks of the depth and scope of their expertise. As announced, as of April 1 Nick Brien will assume the CEO role of World Group from John Dooner, who remains chairman for the balance of the year to ensure a seamless transaction. John was a major force in growing the World Group into a global powerhouse, and we are indebted to him for his dedication and contributions. At Mediabrands, Nick led the introduction of many innovative digital offerings that are driving the business forward. Working closely with us at IPG, and drawing on his multi-disciplinary experience, Nick has also created a culture of collaboration at Mediabrands that helped us win a number of major integrated pictures. The senior leadership team that remains in place at Mediabrands is well positioned to continue the success we have been seeing of late. This focus on innovation, digital solutions and integrated marketing are all qualities that we believe will help us unlock greater value from the McCann franchise. In sum, we have the talent and the tools to return to growth in line with the broader recovery. While there is still uncertainty as to what we can expect him in 2010 and we will manage the business accordingly, the economy has stabilized and begun to show signs of improvement. Clients are taking note, and should increasingly move forward with their marketing and branding programs. Therefore, our goal of achieving 8% or greater operating margin this year in a flat revenue environment is within our reach. As is the opportunity to more aggressively expand margins if the back half of 2010 shows marked improvement. Ultimately, our goal continues to remain to be fully competitive margin performance in the years to come. In terms of our professional offerings, we will stay focused on the horizon by investing in digital talent across all our agencies, continue to develop tools that demonstrate the work we do is moving the needle for our clients’ business, adding to our strength in emerging market growth areas such as the bricks and ME&A [ph]. This combination of contemporary forward-looking agencies and highly disciplined financial management will be the key driver of long-term value for our shareholders. With that, I would like to thank you for being with us and open up the floor for questions.

(Operator instructions) One moment sir for the first question. Our first question comes from Alexia Quadrani from JP Morgan. Alexia Quadrani - JP Morgan: Thank you. Michael, if I could follow up on your comments on McCann, if you could give us a better sense I think of how the performance was at McCann in the fourth quarter, compared to the overall company, maybe how that was versus the trends you saw earlier in the year and specifically are you seeing any improvement going into 2010?

Well, you know, obviously McCann is our largest global network, and a significant contributor to our profitability and revenue. It continues to be that. We saw some softening in Europe in particular with respect to McCann, but overall I believe you know, as indicated by the wins at MRM with General Motors and other potential new client opportunities, and expansion of opportunities within their existing clients, I am comfortable that McCann World Group continues to be and will continue to be a major factor in our overall performance. I think it was a difficult year for everyone in 2009, and what they showed at the World Group is their ability to take cost out of their business, reposition themselves in the marketplace. If you take a look at some of the severance expenses for example in particular in Japan and in Europe, these just weren’t headcount reductions. These were structural changes at the World Group to be more efficient in the market place. We are adding new talent and management there that I believe will go a long way to returning McCann World Group to the high levels of margin that they are used to accomplishing. That said they still delivered margin for us and overall profitability and their competitiveness in the market place is first-rate. Alexia Quadrani - JP Morgan: And then you touched on auto earlier. We have a lot of moving pieces in auto at IPG in 2009.

Yes. Alexia Quadrani - JP Morgan: I know it's very early in the year, it might be too hard to comment. But do you think it's -- what's your outlook for I guess, auto in general for you guys in 2010? Do you think it's possible we could see it up or is that going to be hard to tell?

Well, you know, it can’t go any worse than it was in 2009, and there is no question that we're seeing improvements. Even in the fourth quarter, we saw certainly the reductions in the auto sector were less in the fourth quarter than they there before and we are seeing positive impact, particularly from General Motors. The other side is we’ve been winning other clients in the auto sector, the media group in particular with the adding of Chrysler and BMW, and our continuous performance at Meteor [ph] and Hyundai, very encouraging and of course Deutsch won Volkswagen. So the auto sector will continue to be an important sector for us, and I see encouraging signs on the expense side, and of course, General Motors is back to spending and they can't believe the old agency continues to be the agency of record with respect to Chevrolet, and McCann World Group continues to service General Motors on a global basis. So I'm encouraged by what I'm seeing on the auto sector. Alexia Quadrani - JP Morgan: And last question is just on -- you've had very impressive cash flow in the quarter. You're in a net cash position right now. I know Frank mentioned pay down of debt obviously still a priority. But any chance you might, I guess, look beyond that as dividend, buyback, anything like that?

It took us the first question to get to that Alexia. Look as we always said, we need some stability in the environment and obviously stability in our environment will lead to us being back on track to increasing our margins and getting to competitiveness. When we see that there is no question that we believe we have excess cash on our balance sheet that we can use for various purposes and certainly returning to dividends and share buybacks is well within what we're looking at. And so we will continue to look at that closely. I am looking forward to the day Alexia when you can announce one of those programs and that will be the sign that the stability and recovery is really here for us. Alexia Quadrani - JP Morgan: Thank you very much.

Thank you Alexia.

Thank you. Our next question comes from Matt Chesler from Deutsche Bank. Matt Chesler - Deutsche Bank: Good morning.

Good morning. Matt Chesler - Deutsche Bank: So you addressed the 8% margin bogey for next year, and you finished the year strongly and had high levels of severance. So certainly I think you're well positioned to be able to you know, deliver to that or come close to it. Just wondering what gives you the confidence that you're able to bridge the 230 basis points margin gap from the reported margins, when it looks like your peers are not quite as optimistic? Are you seeing something different in your cost structure than they are?

Well, you know, if you look at the actions we've taken, particularly on the severance side, I think given the size of our business and what we've taken in severance versus our peer companies, it's pretty indicative of the fact that we were more aggressive in terms of that area. Obviously, the key for that is as we grow revenue the leverage effect of that and not adding to our cost basis will be critical to us delivering those types of margins, and given the cost disciplines that we’ve already indicated we have and you've seen, the only time we are going to be increasing cost is associated with revenue. And the fact that we were making structural changes not just headcount reductions for the sake of headcount puts together the efficiencies as well as the cost disciplines and that leads us to conclude that we should be able to do that. Certainly if you back out the excess severance, we have a good head start in terms of recovery in that.

And Matt, we're coming from a different place from margin perspective, and if you look at the progression of our margin improvement through 2008 it was dramatic given where we started from, and the whole plan this year as is relates to cost management was get our cost base in-line with and get back to that margin progression we were on coming out of 2008, and you know, going through the planning process we're comfortable to say that we believe in a stable revenue environment we can get there.

You know, the standard question has always been to us when we sit down with our investors is, is there a structural reason why you can't deliver competitive margins, and the answer continues to be no, it is not a structural issue. We just have to get our revenue and costs in line, and I think we've shown that we have the ability to do that and we are very well positioned given the action we took in 2009 with the recovery on the revenue side to deliver that. Matt Chesler - Deutsche Bank: And Frank, is there a revenue environment implicit in you know, that viewpoint of getting to 8% margins? Do you need a 2% growth or better to be able to get there or do you think you can do that on the 0% organic base?

We've said that in a flat revenue environment we can get there. Matt Chesler - Deutsche Bank: Great. Thank you.

You're welcome.

Thank you. Our next question comes from Peter Stabler from Credit Suisse. Peter Stabler - Credit Suisse: Thanks very much for taking the question. Frank, you mentioned early on I think that progress might not be linear or Michael that might have been one of your comments.

Yes. Peter Stabler - Credit Suisse: Could you talk a little bit more about that? The competitors have been fairly clear that we'll see sequential improvement quarter-to-quarter. Are you seeing something different? And would you be willing to take a stab at when you might see that zero growth number? Could it be at early as Q2 or are you looking more to the second half situation?

Yes. The reference is not being linear is basically a note of caution in that in terms of any recovery is lumpy. You never know where it's going to come. It's certainly going to come from different sectors, and it is going to come from different geographical areas. We are encouraged by what we're seeing in Latin America and in India, and obviously China is a growth potential for us as well. And the sectors that we are in, there is no question that we are -- we were hurt dramatically by auto and tech and telecom. And it's going to take us at least the first quarter and some of the second quarter, and actually some of the rest of the year to really roll on through that and see some of the lots of assignments particularly in tech and telecom roll through us. So that said, so the first quarter I think will continue to see a negative impact, and thereafter we should start seeing positive improvement in terms of the revenue stream. So I would say back half of the second quarter on through the rest of the year should be how this unfolds, but again I think this recovery is somewhat tenuous, and it's not going to take a lot for everyone to get spooked again, in terms of spending those dollars, but you know, there is no question that our major multinational clients are committed to building their brands and gaining market share in this environment, and you’ve heard that announced by the CEOs of these companies saying now is the time to spend behind their brands, otherwise they're going to lose, and so we are right there with them working with them to gain that market share. Peter Stabler - Credit Suisse: Great. Thanks. And a quick one for you, Frank, if I may. Could you characterize the salary situation for 2010 for existing employees? How widespread were wage freezes in ’09? And in a zero growth environment, how should we be thinking about upward salary pressures for folks who haven't had any salary increases for 12 to 18 months?

Peter, there is no mandated salary freeze out of IPG. The respective operating units based on the environment they are working in made those decisions. And I think they did a terrific job and in holding the line of salary they're making quite frankly difficult decisions on people. As we move into 2010 again there is no mandated governor coming out of IPG. The operating groups have margin targets and I think that the pain we all went through in 2009 to right-size our headcount to reflect the economic pressure we are under, I think our expectation is that there'll be very disciplined as growth comes back in the equation to manage their salaries accordingly.

Peter, let me expand on your question a little bit, because it goes to this issue of you know, we have high severance expense, and we took a significant amount of our people. That doesn't mean to say we're not adding to our employee base in those areas that are growing. Obviously in the digital area, the new business area when we pick up new clients, which fortunately were back positive in terms of net new business, we are adding to our base and we are recruiting, and we are focusing on the growth areas. So certainly a portion of the reductions in our headcount are structural and on areas that don't have the growth than other parts of our business, but if you look at R/GA, you look at HUGE, you look at MRM, you look at the digital space, you look at the media environment, we are adding to our talent and that is in fact why I say I'm comfortable with our competitiveness in the marketplace, and so it's not just that we're hunkered down and there is a freeze on hiring and there is a freeze on salaries. We are investing in the growth areas of our business and that will continue. Peter Stabler - Credit Suisse: Thanks very much.

You're welcome.

Thank you. Our next question comes from Dan Salmon with BMO Capital Markets. Dan Salmon - BMO Capital Markets: Good morning. Thanks for taking my questions. First one for Michael, obviously we continue to see the rate of decline improve, and I was just wondering if you could help us understand sort of how that worked on a month-to- month basis through the fourth quarter, and perhaps early into the first quarter here. And in particular, what I'm getting at is wondering if you're seeing any hiccups in that, perhaps driven by Southern Europe, and then a second one for Frank would be can you maybe give us an update on your conversations with the credit agencies.

Yes, you know, rather than month-to-month, I think if you look at is the auto sector I think the biggest driver. If you look at our negative 8%, roughly 8% organic, half of that was attributable to auto and tech and telecom, okay. And in the fourth quarter auto improved versus that decline, and now it's encouraging and we're continuing to see that. So in the fourth quarter, auto came back nicely versus, when I say came back it's less worse than it was before, let me put it that way. Tech and telecom, the same although it didn't come back as strong as we did in auto. The other part of the business, for example financial services, last year and we had a negative result out of financial services, we're seeing recoveries in financial services in the fourth quarter and retail was strong as well, and what's interesting is the effect on health products, although last year fourth quarter was pretty solid, we saw a very slight decline in the fourth quarter this year, which is encouraging because that means it was solid. So those should give you an idea what the sectors that are contributing to our results.

And Dan, on the rating agencies, we're in constant dialogue with them. I think that they are through here in the next month for a deep dive on the year-end results. I think they view the results from both a working capital management perspective, a liquidity perspective getting the LC facility in place, delevering during the year. We’d hope to continue to see you know, the move more to a positive outlook, and we’ll continue to be transparent and be aggressive and try and get them to adjust their ratings.

Well, you know, Frank is being polite. I mean we think our ratings aren’t where they should be. Obviously in this environment rating agencies don't bring you up. They bring you down quickly, but we think we've certainly proven all the disciplined approaches and consistency in that and our balance sheet is solid enough that we think we should get upgraded, and that's what the team is pushing for. Dan Salmon - BMO Capital Markets: Okay, great. Thank you.

Thank you. Our next question comes from David Bank from RBC Capital Markets. David Bank - RBC Capital Markets: Thanks very much. Good morning. Couple of questions, the first one is, Mike or Frank, you guys have mentioned the term a couple times, structural changes, with respect to the implementation of some of the severance costs. Could you give a little bit more kind of specific color around what those structural changes are organizationally, operationally? What are those structural changes? Second question is in terms of kind of what you're seeing on client fee negotiations right now, how is the environment different than it was a month or two or three or even four months ago? What does the tone of those conversations look like in terms of the delta? And the last question, I don't think you mentioned a whole lot about acquisitions. Any sort of change in terms of priority there and things you might be looking at? And I'll stop there. Thanks very much for taking the questions.

Okay, structural. What we mean by structural is you take the World Group for example, eliminating layers in terms of efficiency is critical to structural changes, okay. And we put new management, Mike McLaren, we put into Japan for example and he took some actions with respect to removing layers of management so we're more efficient and closer to the marketplace. Brett Gosper has additional responsibilities in Europe, and he too took strong actions in terms of structural changes. So when we talk about structural, we are talking about efficiencies, eliminating various layers of people and really putting client facing people where they belong and that is in front of the clients, and delivering on the value of the products and services that we have. In terms of pricing, you know, obviously 2009 was a very difficult year from pricing. Most evident in the media pictures that were going on and the demands by our clients in the media arena, and that sort of feeds on itself which is why you start seeing clients looking at putting their media business up for review, because they think they can capture savings in efficiencies. And I think that's going to continue into this year. Until we have a real robust recovery, we're going to see a lot of them persist on pricing, and certainly procurement is sitting at the table at all of our negotiatings. It's nice to point out as Frank pointed out in his, we're doing the same thing on our procurement side, not quite as much as on our client side, but clearly that's what has to go on in this environment. As the recovery takes hold, I think we'll see some lessening on that, because the value of our services you know, continue to be critical to the success of our clients, and once there is a recovery then not that they're going to go away, but the pressures become a lot different. And so I think that's what we're going to start to see. Acquisitions, you know, we were, we continue to look at acquisitions, but again they have to be totally critical and consistent with our overall strategy, digital acquisitions you’ll continue to see, we continue to look at that. I wouldn't be surprised if you see some digital acquisitions for us, particularly in some of the growth regions, you know, like Latin America and potentially China and India. And those are the growth areas, and that's where we're going to put our dollars. We have the financial wherewithal, we have it built into our model for 2010. I think we said you know, historically on acquisitions we've been around $150 million, and we've been less than that in the past, and we'll be careful on how we spend those dollars, but we'll continue to be opportunistic in that.

And David, the number of opportunities we look at in 2009 was consistent with the prior year. We just were very disciplined in holding to pricing structure, and quite candidly we walked away from a lot of things because we thought pricing was off market.

Yes, and the other area you look at acquisitions in areas we have holds. We don't have any big holds in terms of our offerings, but in some locations in certain areas, it's important for us to beef up our presence if you will. So those are the kind of acquisitions, but we're not missing a major piece of any of these offerings. David Bank - RBC Capital Markets: Thank you so much.

You're welcome.

Thank you. Our next question comes from Meggan Friedman from William Blair. Meggan Friedman - William Blair: Hi, thanks for taking my questions.

Sure Meggan. Meggan Friedman - William Blair: Just a couple of questions. First, in terms of the weakness in the tech vertical in particular, how long should we be thinking that revenue challenges are going to persist there? When will we really cycle through that pressure and facing easier comps at least?

Meggan, we're going to have some headwind for a good part of the year. Meggan Friedman - William Blair: Okay. (inaudible).

It is stronger in the early part of the year but it is still there. We wish we could tell you a finite time when that happens, but it was a contributor throughout the year. So obviously we those lost assignments, it will affect us, but it will be greater in the early part, and maybe in the later part. Meggan Friedman - William Blair: Okay Great. Thank you. I know you don't provide net new business win numbers, and forgive me if I missed this, but were you -- did you end the year in a net positive position and could you provide a little color on how new business activity phased over the course of the second half of the year in particular? And then generally speaking, what is the lag that you're seeing for beginning to realize the organic benefit from net new business activity?

Well, you know, we had a very strong fourth quarter, and particularly in the media side. A number of the auto wins in media were in the fourth quarter. In terms of big clients, Pizza Hut was a big win for The Martin agency, Volkswagen was a big win for Deutsch. Draftfcb added to Miller Lite. So you know, I think towards the latter part of 2009, we recovered if you will on the net new business. Going into the fourth quarter, we were a little bit behind. We finished the year, net new business positive, and we haven't seen much activity so far this year. So I think we should start seeing the impact of that fairly soon in terms of particularly all you have to do is look on TV, and you'll see some of -- the Pizza Hut business, you're already seeing the new stuff as is the Volkswagen stuff. So we're trying to see the impact of that already. Meggan Friedman - William Blair: Great. Thank you.

You're welcome.

Thank you. Our next question comes from Ben Swinburne with Morgan Stanley. Ben Swinburne - Morgan Stanley: Thank you. Congratulations on surviving ’09, and also for getting to work this morning.

You too. Ben Swinburne - Morgan Stanley: A couple of questions I have. Maybe first we could start on the cost levers and the margin conversation we've had all morning and Frank, when you look at 2010, obviously severance should be down assuming the top line continues to improve. What are the other areas we should be watching this year and where you expect or other movements in expense buckets that we should be following. I'm looking at your deck, and you've got legal entities which have been coming down for many years, continue to decline in ‘09 versus ‘08 and also your real estate numbers come down, it looks like there's still a decent amount of unused or subleased space. Just wondering if those are areas where you expect to see drivers of margin in 2010?

Ben, we think the largest driver is going to be in the salary line. I think we've done a pretty good job in the O&G cost, and we'll continue to go against those buckets very aggressively, but you know, the real opportunity for us is to drive leverage from the severance actions that we've taken this year, be aggressive in how we manage supporting potential growth and just be very aggressive on how we manage the salary line. And I think that's where the greatest leverage is going to come from. Ben Swinburne - Morgan Stanley: Okay. And then just quickly, point of clarification on the covenant changes, Frank you mentioned up front. Was that primarily because of the severance you took this quarter, and I think these are looking on a trailing 12 months. A set of numbers on the minimum EBITDA on the leverage chart, is that really behind the changes?

Yes, as Michael called out in his comments, you know, when we came into the fourth quarter we saw some softness in certain markets. Our operators were being very aggressive, positioning themselves for 2010 by taking the appropriate cost actions and severance actions in the fourth quarter. We thought there may be some issue with our covenants. Our banks were very, very supportive in adjusting those covenants, because they saw the benefit of the actions we're taking and that was the entire reason for it. Ben Swinburne - Morgan Stanley: Got you. That makes sense. And then Michael, some of your peers talk about how their digital business, what percentage of the business digital is and you know, what is or isn't digital is sort of in the eye of the beholder. I thought I would ask you, as you look at ‘09, how did digital hold up? You've got some very strong agencies in that area, but I think probably most of your agencies touch on digital one way or the other. And then how are you thinking about that, the growth in the that business in 2010?

Well, yes first of all our specialized digital agencies, particularly RG/A and HUGE had very strong performance in terms of growth, and we expect that to continue into 2010, and you're correct. Our approach to digital in addition to the specialized digital agencies, you know, we have our fully integrated agencies very strong in digital, Draftfcb, the rest of MRM, part of the World Group, even our independent agencies all have very strong digital offerings as does our PR business, our events. So digital is across the board of all of our IPG affiliated companies, and in terms of percentages, it is hard for us to get our arms around how much of our business is digital. There have been estimates out there based on various sources and you know, some were in the 15% ranges as we've seen out there, and that should be some indication of where it is, and obviously it's growing and it's growing solidly and we're continuing to invest in it. So I think clearly we are very competitive. We continue to win, our R/GA recently won some Wal-Mart business as you know, as well as some MasterCard business. And I think those are critical pieces of our offerings, as well as our individual agencies just their DNA includes digital. And that's the way this business has moved to and we're comfortable with it. Ben Swinburne - Morgan Stanley: Great. Promise my last question, just on retail. You mentioned up front that retail was very strong in the fourth quarter. I'm just curious if you see that category so far in 1Q, and also sort of your general view in 2010 has that continued, just to answer the question I get it is about fourth quarter kind of budget flushing in the retail category, I'm curious what you guys are seeing?

Yes, well, you know, clearly the issue there is going to be consumer confidence and that's what when I say the overall environment is tenuous that's where it is, okay. And obviously Wal-Mart is an important client of ours, and they contributed a good fair share of that growth, and I think we see that continuing but a lot of that is going to be a function of the macro economic environment, but we're you know, we will also do other retail agents in our companies Coles and so on. So these are very important components, and recently the Mullen Agency won Men’s Wearhouse. So it will continue to be an important category for us. Ben Swinburne - Morgan Stanley: Thanks a lot, everyone.

Thank you.

Thank you. Our next question comes from James Dix from Wedbush. James Dix - Wedbush: Good morning, gentlemen. Just had two questions for you. First, in terms of the timing of the optimism you expect, Michael, for the year, more focused on the second half than the first, is that reflecting kind of a flow of the budget activity you're seeing from clients or is that more what you're seeing in terms of the comparisons of your overall business? And then just a second one, because I know we're running late on time, any color you could give on growth by discipline? You know, in terms of creative versus media buying and planning, I'd be particularly interested in how you think your overall business mix by discipline is positioning you in terms of getting to you know, competitive growth.

By the way my optimism was tempered optimism, okay. I try to interject a new word in there, all right. Look I do think it's more towards the latter part of 2010, and obviously that's the easier thing to see, but in fact that's how we're seeing it roll out from our various business units. We do this, you know, we just don't, we work from bottoms up, and that's where we're hearing from our agencies and so on. And certainly you know, I think we've shown a very strong improvement on our media side, and as you see media pitches out there, we're very competitive. So I think media will continue to be a good source for us in terms of growth opportunities. Digital obviously that's where a lot of the action is, social networking and all the interfacing with the consumers. We're investing in the tools that are necessary to do that well, and it's across all our disciplines, and I think that's where a lot of the new business is going to come from, and we're showing that we are very competitive in those arenas, and let's not forget the consumer goods, packaged goods and those are important products and they have to continue to invest in those brands, and that's what we do. We build brands, we help our clients build brands and we provide the link if you will, between the brand and the consumer, and anyway we can do that, we have investments in and we can help. So that's where a lot of the action is going to be. James Dix - Wedbush: Great. Thanks very much.

You're welcome

Thank you. This concludes the question-and-answer session. At this time I'll turn the call back to Mr. Leshne.

Well, thank you very much. This is Michael and we do appreciate your participation this morning. Those of you who have to travel home in this weather, safe journey. Thank you.

This concludes today conference. Thank you so much for joining. You may disconnect at this time.