AGM 2021

May 19, 2021

Hello, and welcome to the Annual Meeting of Stockholders of Universal Health Services Inc. Please note that today's meeting is being recorded. After the formal meeting has adjourned, we'll have a question and answer section. Any stockholder logged into the virtual meeting web portal using their 15 digit control number can submit questions or comments at any time by clicking on the message icon. Out of consideration for other stockholders, please limit yourself to one question relevant to the annual stockholders' meeting. The company will attempt to answer as many questions as time allows. However, if time does not permit all questions to be addressed, you are encouraged It is now my pleasure to turn today's meeting over to Alan Buehler, Executive Chairman of the Board of Directors of Universal Health Services Inc. Mr. Miller, the floor is yours. Thank you. Welcome to the annual meeting of stockholders of Universal Health Services Inc. Due to the continuing public health impact of COVID-nineteen pandemic, this year's annual meeting is being conducted completely virtually via a live audio webcast. I'd like to introduce the other directors and officers who are participating in today's meeting. Directors are Mark Miller, Larry Gibbs, Eileen McDonnell, Warren Nimitz, Maria Singer and Doctor. Elliot Sussman. Officers of the company are Steve Filton and Chick Boyle. In addition, Jeff Williams and Bill Leiva of PricewaterhouseCoopers, our independent auditors are participating today and available to respond to any questions. Steve Plepka of Computershare, our transfer agent is participating today and will act as Inspector of Elections as to the Class B and D votes. In order to avoid any confusion, let me just take a moment to outline the format. First, each company proposal will be made and seconded. The Board of Directors' position on each proposal is set forth in the proxy statement, which was made available to all stockholders. Next, we will tally the preliminary votes with regard to each proposal. The polls on our virtual meeting website opened at approximately 9:50 a. M. Eastern Time this morning. Any stockholders who have logged into the virtual meeting web portal using their 15 digit control numbers will be able to make or change their votes electronically until we declare the polls have closed. For the record, as persons appointed in the official proxy, Mr. Filton and I have voted in accordance with the proxies received from stockholders. Once the votes on all the proposals have been tallied and the results announced, the meeting will be adjourned. After the meeting is adjourned, we will attempt to answer as many stockholders' questions as time allows. The meeting will please come to order. Mr. Steve Filton will act as Secretary of the meeting and Inspector of Elections as to the Class A and C votes. I present the affidavits of Computershare and this company with respect to the notification to the company's stockholders of the notice of the meeting, the annual report, the proxy statement and the forms of proxy, which were mailed to Class A and C and to Class B and D stockholders who requested to receive printed proxy materials. I also present the affidavits of the inspectors of elections and the voting certification for the Class A and Class C stock prepared and certified me as Secretary of the Company. The affidavits, forms of proxy materials and voting certification are directed to be filed with the company's records. Mr. Chairman, I present the certified list of holders of the company's Class B and D common stock as of the close of business on March 25, 2021, the record date for this meeting. As prepared and certified by Computershare, transfer agent and registrar for Class B and D common stock, and a certified list of holders of the company's Class A and C common stock as prepared and certified by me as secretary of the company, transfer agent and registrar for Class A and C common stock. The lists of stockholders are directed to be filed with the company's records. Mr. Chairman, the transfer agent has computed the number of shares of Class B and Class D common stock represented by the official forms of proxy provided to the Class B and D stockholders and the number of shares of such classes present or represented here. I have computed the number of shares of Class A and Class C common stock represented by the forms of proxy provided to Class A and Class C stockholders and the number of shares of such classes present or represented here. For purposes of voting for 3 Class A and Class C common stock are present or represented here. For purposes of voting on the other proposal at the meeting, the holders of a majority of common stock votes are present or represented here. A quorum for all matters is present, and the meeting is properly constituted for the transaction of business. As set forth in the notice sent to each of the stockholders, the business of this meeting includes: 1, the election by Class A and Class C stockholders of 3 members of the Board of Directors and 2, the ratification of the selection of PricewaterhouseCoopers LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2021. The meeting will now proceed to the election of 3 directors of the company by the holders of Class A and C common stock voting together. We will now accept the nomination for 3 directors to be elected by the holders of Class A and C common stock together as a single class. I nominate Mr. Mark D. Miller, Ms. Eileen C. McDonnell and Doctor. Elliot J. Sussman for election by the holders of Class A and Class C common stock to serve as directors of the company for a 3 year term and until their successors have been elected and have qualified. I second the motion. Okay. Since there are no other nominations, the nominations are closed. The meeting will now proceed to the ratification of PricewaterhouseCoopers LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 20 21 by the holders of Class A, C, B and D common stock. I'll now entertain a motion for the ratification. I move to ratify PricewaterhouseCoopers, LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2021. I second the motion. There are no other matters, Mr. Chairman. If any stockholder logged in via control The polls are about to close. Any stockholder logged in via control number to our virtual meeting web portal who hasn't yet voted or would like to change his or her vote should do so now by clicking on the voting button on the web portal and following the instructions. Stockholders who have timely submitted proxies by mail, telephone or Internet or given their brokers voting instructions and do not wish to change their votes do not need to take any further action. Now that all eligible stockholders have had a final opportunity to vote, I declare that the polls for the 2021 Annual Meeting of Stockholders are now closed. To proposal 1, the election of directors, 7,238,788 votes were cast in favor of the election of Mark D. Miller and no votes were withheld. 7,000,238 1,788 votes were cast in favor of the election of Ms. Eileen McDonnell and no votes were withheld and 7,238,788 votes were cast in favor of the election of Doctor. Elliot Sussman and no votes were withheld. With respect to proposal 2, the ratification of PricewaterhouseCoopers LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2021, 65,401,430 votes were cast in favor of ratification of PricewaterhouseCoopers as the company's independent registered public accounting firm for the fiscal year ending December 30 1,000 and 2,744 votes abstained. Based on that report, I declare that Mr. Mark D. Miller, Ms. Eileen McDonald and Doctor. Elliot Sussman have been elected to serve as directors of the company for a 3 year term and that the ratification of PricewaterhouseCoopers LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2021 has been approved. This completes our agenda. I thank you for listening through the legal formalities of the meeting. The Chair will entertain a motion for adjournment. I move that the meeting be adjourned. I second that motion. All those in favor of the motion, please say aye. Aye. Aye. All opposed, the motion is carried and the meeting is adjourned. The business affairs of the company were fully discussed in our shareholder letter and the balance of the annual report. I will be glad to answer any questions which the stockholders may have concerning the business affairs of the company. Thank you for your attendance and attention. Attention. At this time, the company would like to take any questions you might have for them today. If any stockholders logged into the virtual web meeting However, if time does not permit all questions to be addressed, you are encouraged to submit your question as instructed via the Investors section of the company's website. Steve, do we have any questions presented by the stockholders today? Mr. Miller, we have at least one question from Mr. Kevin Morrow. He writes, independence is critical to protecting the integrity of corporate financial reporting. Given that audit firm and corporate client relationships are generally long tenured, federal regulations require that the lead engagement partner be rotated out of that position every 5 years. PricewaterhouseCoopers has been the company's auditor since 2007. Could the Chair of the Audit Committee or the representative of PricewaterhouseCoopers describe the lead audit partner rotation process and indicate who makes the decision in the selection of the new lead engagement partner? Thank you. I'll answer the question preliminarily and then if PwC or Ivy McDonnell want to add any more color, they certainly can. But first of all, thank you, Mr. Morrow for your question. We're well aware of the rotation requirements and have a partner rotation coming up in our next audit year. The way that process generally works is PwC will provide certain recommendations of partner rotation to the management of UHS. We'll consider those considering variables like industry experience and tenure, etcetera, have a dialogue with PwC on that, involve the audit committee in that process and ultimately make a recommendation which the audit committee will review and approve. And that process is just getting underway for our next calendar year. If Eileen McDonnell or PwC want to add anything, they certainly can at this time. The only other thing, this is Eileen McDonnell, that I will add is that we also, before we begin that process, discuss if we are satisfied with the services from PwC or if there would be a need to think beyond that. But otherwise, everything you described is accurate, Steve. Is that Eileen? Yes. Okay. And this is Jeff Wyden, PricewaterhouseCoopers. I'd like to just echo Steve's summary was accurate. PwC takes independents very, very seriously. And as I said, Steve described the process correctly. Yes, go ahead. No, no, go ahead, Alan. No, you go, Steve. There's a second question from Mr. Morrow, and I'll read that. It says, Mr. Chairman, the topic of stakeholder capitalism as an alternative to shareholder capitalism has received considerable attention recently as long term pension fund investors, the Carpenter Funds, appreciate the sentiments embodied in the stakeholder capitalism perspective, but feel that execution could be complicated. Could you discuss the Board's perspective on the concept of stakeholder capitalism and what principles the Board would use to balance the interests of varied stakeholders as it develops and implements the company's long term business strategy? Thank you. Again, I'll provide a quick answer and then certainly, Alan, if you or any of the other Board members want to add some color, that's fine. I would just make the point that UHS has long shared the view that we have critical stakeholders and if you read our mission statement, it has always included stakeholders, not only our own shareholders, but our employees, and most importantly, our patients, because we are in the business of treating patients in individual communities. We're very much focused on the needs of every patient that we treat and the communities that we serve along with our own employees who are critical to providing that high quality care. So I think we've been focused on that concept of stakeholder capitalism, although we don't necessarily use that same term. Alan or any other Board member that wants to add any comments or color, please do so at this time. I would just add and reiterate what you said, Steve, that we are primarily focused on patient care and then all of the other categories. The other thing I'd point out is that we have heard today from the 2 ladies who are on our Board. Of the 7, Eileen McDonald and Maria Singer, and I thank them. This concludes the meeting. Thank you for attending, and you may now disconnect.