Preface

 

I am surprised that a plan for healing in connection with The Hershey Industrial School Trust, now known as the Milton Hershey School Trust (the “Trust”), has not already been written. Over the history of the Trust, the relationship between the Trust and various groups has changed. Today, the Trust’s relationship with the Community of Hershey is fundamentally different from that which existed when Milton Hershey was alive. Many Hershey community members do not understand why it is different and some are very concerned that the Community of Hershey does not derive more direct benefit from the Trust. The businesses that are now within the Trust, succeeding Hershey Estates and Hershey Chocolate Company, are very different from their predecessors and have different relationships with the Trust. In fact, some are concerned that their relationship today is too close, after considering the difference between Hershey Estates and its successor, HERCO. Their interest in the Trust resources such as land are reviewed with great anxiety by those who expect that all resources within the Trust should be used exclusively for the beneficiaries of the Trust.

 

Moreover, after two decades of alumni effort, alumni of The Hershey Industrial School, now known as the Milton Hershey School (the “school”), achieved in 2002 fundamental reform (the “2002 Fundamental Reform”) of the Board of Managers of the Trust, with full support of the Orphans Court and the Office of the Attorney General, to return the school to fulfilling the original intent of Milton and Catherine Hershey (the “Hersheys”). While this had been sought for 20 years, various groups of alumni of the school continue their infighting. While some would argue that there is more to it, my view is that the infighting revolves primarily around how to arrive at the same desired goal.

 

The reason I am writing this is not because I believe I have all the answers. Rather, I am writing this only because no one has already addressed the issues of healing and I strongly believe that the Trust will continue to experience great hardship if these issues are not properly addressed, making it increasingly more difficult for the Managers and the school to achieve the great philanthropy established by the Hersheys.

  

 

 

Introduction

 

In 1999, a cy pres petition that would have re-invented the Trust was defeated, in large part due to the efforts of John Halbleib, John Mardula, Graham McIntyre, Joe Berning, Mike Wilson, a few other individuals and my law firm, through MHSAA. This is a matter of public record, and the filings are available to registered users (who are logged in) in the Library area of this Website. This was the very first time that the Managers were defeated in their many efforts to modify the Trust following Milton Hershey’s death in 1945. At the time, it was widely believed that the Managers would receive the relief they were seeking and that our efforts in 1999 were pointless. Instead, this defeat of the Managers was and remains a fundamental turning point in the Trust and the efforts of all alumni to restore the school to its original mission and prominence, and is well described as the “1999 Turning Point”.

 

During 1999, 2000, 2001 and 2002, a team of individuals fought for fundamental reform within the Trust. This team included John Halbleib, John Mardula, Graham McIntyre, Joe Berning, Ric Fouad, Rod McLaughlin, Johnny O’Brien, other individuals and my law firm, again through MHSAA. This period is well described as the “1999-2002 Research, Investigation and Reform Efforts,” because during this period their was unparalleled research completed, an investigation by former Governor Dick Thornburg, a subsequent investigation by the Office of the Attorney General, and negotiations leading up to an agreement designed to return the Trust to fulfilling the philanthropy of the Hersheys as set forth in the Deed of Trust. Concurrent with the entering into this unprecedented agreement, it became public knowledge that Hershey Foods Corporation was available for sale, supported by the Board of Managers. Within days, all of Central Pennsylvania rallied around many of the issues raised by the alumni, including that the Managers were no longer pursuing the Hersheys’ philanthropy; rather, they were pursuing a philanthropy that manifested the combined desires of a control group within the Managers. While there were other common elements of concern, it seemed that Central Pennsylvania seized their vague recollection that the Hersheys philanthropy was of a unique nature somehow combining Community, Business and Education in a self-reliant philanthropic model. Their vague recollections proved sufficient to cause more than a majority of the Managers to voluntarily resign and the remaining Managers to elect a few new Managers and for Johnny O’Brien to become the President of the School, which was a fundamental reform supported by the Orphans Court, the Office of the Attorney General, the Community of Hershey, Central Pennsylvania and the Milton Hershey School Alumni Association (“MHSAA”) (the “2002 Fundamental Reform”).

 

In the fall of 2002, there was consensus that fundamental reform within the Trust had been achieved as a result of the reconstitution of the Board of Managers and Johnny O’Brien becoming the President of the School. There was an understanding that changes at the school would take at least 5 years, if not more and there was consensus to give Johnny O’Brien time to make such reform and return our school to its original greatness.  My law firm remained involved from early 1999 throughout 2002 and into early 2003, and withdrew as counsel once there was consensus that fundamental reform had been achieved. With the consent of Scott McCue, I am making our letter of withdrawal available for your review. Here is my firm’s letter of withdrawal:

 

 

 

Notwithstanding the consensus view in 2002 and early 2003 (which in the fall of 2002 seemed to be a view shared by Ric Fouad and other post 2002 MHSAA leaders) that material structural reform had been achieved and that Johnny O’Brien and the new, reconstituted Board of Managers needed time to make fundamental changes, a few members or the core team, including Ric Fouad (as well as a few others) later, separately determined that more needed to be done. Their view emerged as a strong minority view. Though this was a view held by a minority of alumni, they had achieved control of MHSAA’s Board of Directors. Notwithstanding efforts to require that they manage MHSAA consistent with the majority view of the alumni, this small splinter group used MHSAA to pursue their minority view of what needed to be done. To this date, I am not aware of any letter of thanks, or any other formal expression of thanks, received by my firm, by me or by Scott McCue.

 

Notwithstanding the consensus view in 2002 and early 2003 (which in the fall of 2002 seemed to be a view shared by Ric Fouad and others) that material structural reform had been achieved and that Johnny O’Brien and the new, reconstituted Board of Managers needed time to make fundamental changes, a few members or the core team, including Joe Berning and Ric Fouad (as well as a few others) (such 2003 leadership (Fouad, Rice and Waters, among others) (the “Post Reform MHSAA Leadership”)) later, separately determined that more needed to be done. Their view emerged as a strong minority view. Though this was a view held by a minority of alumni, they had achieved control of MHSAA’s Board of Directors. Notwithstanding efforts to require that they manage MHSAA consistent with the majority view of the alumni, this small splinter group used MHSAA to pursue their minority view of what needed to be done.

 

Before we can fully understand these competing views, one needs to understand the Hersheys’ original philanthropy. The next section describes the Hersheys original design of The Hershey Industrial School and the section follow such description, details some of the challenges of the Hersheys philanthropy. Once one has a better understanding of these two areas, it is easier to understand the context for the disputes that continue among alumni of the school. But these are not the only disputes that remain. The continuing dispute among alumni of the school is merely a good example of how good intentions can get in the way of progress.

 

 

Diagram 1: The Original Structure of The Hershey Industrial School – 1945

 

 

 

In naming three separate entities the same name, there was a message passed on each time emphasizing the overall scope of the Hersheys’ philanthropy. The Hershey Industrial School is comprised of three major components, each of which is reflected in its name:

1.      Hershey represents the community of Hershey, PA.  It includes Derry Township and certain surrounding land. This component of The Hershey Industrial School is referred to as Community.

2.      Industrial represents the various businesses, including the Hershey Chocolate Company which the Hersheys created. This component of The Hershey Industrial School is referred to as Business.

3.      School represents the education system which the Hersheys created within Derry Township, including those that were public and those that were not. This component of The Hershey Industrial School is referred to as Education. 

 

Community

The unincorporated town of Hershey is part of The Hershey Industrial School. Substantially all of Derry Township and land adjoining or conveniently near constitutes the Hersheys’ Children’s Home Campus; this constitutes the land upon which the Hersheys built The Hershey Industrial School, which includes the Hersheys’ “ideal community” – Hershey, Pa. Inasmuch as “the town of Hershey” (which includes Derry Township and certain surrounding land) is owned by the School, Hershey, Pa. constitutes the campus of the School (which is the same thing as the Hersheys’ Children’s Home). Accordingly, the Trust, or businesses owned and/or controlled by the Trust, would incur some “normal operating costs” such as streets and sanitation, education, etc.

As part of the Hersheys’ Children’s Home Campus, the Trust incurs these types of expenses and capital improvements in order to maintain and improve said campus. Such campus includes the town of Hershey which was established to serve as the home shared by the Current Beneficiaries and others who played a role in the Hersheys’ Children’s Home. The Managers operation of this campus, including Hershey, Pa., is provided for in Milton Hershey’s Deed of Trust. However, to be clear, this is not because the Community is a beneficiary of the Trust. Rather, it is because the Community is unincorporated, part of the Hersheys’ Children’s Home Campus and an important component of providing a real home for the Current Beneficiaries.

The Hersheys’ purpose was to design, build, and operate the town of Hershey for the benefit of his and Kitty’s orphan boys. In summary, the Community is unincorporated, such Community serves as the “home” of the Resident Beneficiaries, the “home” to which the Non-Resident Beneficiaries would return, as well as the “home” of others who also play some role in the Hersheys’ Children’s Home (e.g., as an employee of Hershey Chocolate Company and resident of the Hersheys’ Children’s Home Campus) and such “ideal community” is part of the Hersheys’ Children’s Home Campus. In fact, the Indenture that each parent, guardian, or other competent authority entered into with the Managers expressly provided that “The home provided for the said orphan by the Managers is situated at Hershey, Dauphin County, Pennsylvania.” The Hersheys’ Children’s Home Campus is Hershey, Pa. (which includes Derry Township and certain land surrounding Derry Township) which was expected to, and did, grow into the areas surrounding Derry Township. In fact, the Hersheys’ Children’s Home Campus had spread from Derry Township, Dauphin County, Pennsylvania to land adjoining, or conveniently near, School property into two additional townships in Dauphin County, Pennsylvania, one township in Lebanon County and one township in Lancaster County; there were approximately 55 units in Derry Township, 5 units in South Hanover Township, and 2 units in East Hanover Township, Dauphin County, 1 unit in Conewago Township, Lancaster County and 2 units in Londonderry Township, Lebanon County, Pennsylvania. These three Counties match the first preference geographic areas listed in Milton Hershey’s Deed of Trust. Consequently, the Indentures were worded specifically because Derry Township and the surrounding area (which is paralleled in the postal service area, or town of, “Hershey”) was intended to be, and became, the community that served as the “home” of the Resident Beneficiaries, the “home” to which the Non-Resident Beneficiaries would return, as well as the “home” of those who played some role in the Hersheys’ Children’s Home (e.g., as an employee of Hershey Chocolate Company and resident of the Hersheys’ Children’s Home Campus).  Most importantly, it is the community to which the entire School Family belongs and in which they are considered members. That said, the residences of the students could be located in any of the three preference Counties (or other land for that matter), so long as the land on which it is located is adjoining or conveniently near School property, because each Indenture contemplated that a student’s residence could be other than Hershey, but their respective home would remain “situated at Hershey.”

 

As such, and because land used for school purposes was exempt from taxation, the community was subject to certain overall limitations in size and population because the Trust would have limited resources and such resources must be deployed in a manner that is in the best interests of the Beneficiaries; particularly in light of the high level of fiduciary duty imposed on each Manager under the Deed of Trust and each Current Beneficiary’s Indenture.

The unique role of Derry Township (and the land acquired for School purposes that adjoins or is conveniently near to School property) as the Hersheys’ Children’s Home Campus is illustrated when describing Hershey Estates’ role.  Hershey Estates operated all of the Hersheys’ Children’s Home Campus, including the related businesses.  In the context of fiduciary duties, its use to the School and given the overall philanthropy of the Hersheys, Hershey Estates, with approximately forty separate activities, was not to be viewed by the Managers in the classic manner. That is, as part of the overall philanthropy, the traditional rules relative to diversification of investments and the objective of making a profit were not entirely applicable in the context of the Hersheys’ philanthropic endeavor. Hershey Estates, as part of the School, provides employment for thousands and it provides service and facilities to the School, which, in view of its size, would have to provide for itself at far greater cost.  The interdependent relationship between the School and the community was well understood when M.S. was alive. If Hershey Estates were not the provider of the services it provided to the School, it would be far more costly if the School were required to provide these services for itself, particularly in view of its size.  This interdependence, unique purpose, and economic efficiency were well understood, which when all is considered justify Hershey Estates as a non-diverse and underproductive asset – because it satisfied this unique provision of service and facilities to the School. Thus it was the common understanding and expectation during M.S.’s life that the Hersheys’ Children’s Home Campus was to be, and remain, expansive and rural.  Moreover, Hershey Estates is part of the School – that is, Hershey Estates is part of the permanent “institution” designated the “School” in Milton Hershey’s Deed of Trust.

That all of Derry Township (and adjoining and conveniently near land) is part of the Hersheys’ Children’s Home Campus is reflected in the enhancements to the School arising through M.S.’s creation of the M.S. Hershey Foundation, the 1945 Residual Derry Township School District Trust, and the many improvements made to Hershey with funding coming from the Trust or a business owned by the Trust (e.g., Hershey Corporation, Hershey Chocolate Corporation, Hershey Estates, etc.).

 

Business

An essential component of a self-reliant Hershey Industrial School is the Business that serves as the economic engine funding the Hersheys’ philanthropy while at the same time providing employment and stability to the Community.  The Hersheys’ self-reliant philanthropic structure requires an economic engine to provide economic and employment stability in the Community.  Hershey Chocolate Corporation came to serve as a core component, but not sole component, providing economic and employment stability for the Hersheys’ Children’s Home Campus and surrounding areas.  Other components of the School (e.g., the school, Hershey Estates, and etc.) also provide economic and employment stability, but without the same profit incentive or motive.  Furthermore, the population from which Hershey Chocolate Corporation derived revenue, and its profits, was Nationwide.  Thus, the cost of the Hersheys’ philanthropy was distributed throughout the United States of America in exchange for chocolate.  To continue this self-reliant philanthropic structure in perpetuity, one would not consider any changes pursuant to which control of such profit driven economic engine might be lost. 

Control of the “Industrial” component of The Hershey Industrial School is fundamental to the continued success and viability of The Hershey Industrial School. M.S. fully understood and intended to retain this control.  Should The Hershey Industrial School not have control of the “Industrial” component, surely the success and viability of the Hersheys’ Children’s Home would be threatened.

 

Education     

One of the core components of The Hershey Industrial School is Education. The funding for these resources came primarily from the Hersheys and the Trust, as well as the community of Hershey, primarily through taxes. Lack of opportunity was M.S.’s concern for others, particularly his orphan boys, and education could serve to provide opportunity not otherwise available to a child.  As a consequence, the Hersheys made education a core component of their philanthropy, and this has been observed by many. Wherever possible, the Hersheys’ created educational resources to be utilized by both those admitted to the School, as well as other Derry Township residents.

Unlike other Derry Township residents, Current Beneficiaries typically have unique educational needs not necessarily as common in public school. As Current Beneficiaries came to the Trust, their initial special educational needs were attended to by the “school.” Approximately one-third of those admitted to the School had failed one or more years of education before entering the School. This is not a problem of intelligence or potential; rather, the primary cause is a combination of the disruptive family environment and social disadvantage that often results from the loss of one or both parents. ^[1]  Some new HIS students in various age ranges might repeat a grade or receive other courses to bring them to the appropriate grade level for their age.  Thus many of these new students required special programs not needed nor replicated in the public school system. If these new students are repeating a grade level or receiving other remedial courses while attending public school, the contrast in their daily programs might give the public school students the wrong impression that new students at HIS lacked intelligence and thereby undermine such new students’ view of their scholastic potential. For most of these children, their scholastic potential exceeded that which they were achieving when first admitted to the School. Moreover, the number of Hershey, PA residents who required education was also increasing dramatically.  These public school children were competing for positions in various programs available in the public schools. The Deed of Trust mandates a unique, individualized education for each student. Consequently, some educational resources must be available to the students at the school so as to ensure that each receives the proper education, without competing with students attending the public schools for access to such education.  

All of the uses contemplated by the M.S. Hershey Foundation were limited to Derry Township and its residents for educational purposes. Note that the geographic reach of said foundation and the benefits of the M.S. Hershey Foundation to residents were both subject to the limits of Derry Township; moreover, this foundation was focused on the third core component of The Hershey Industrial School – Education. Likewise, in 1945 upon M.S.’s death, he formed a residual trust pursuant to Milton Hershey’s 1944 Final Will through which M.S. bequeathed all of the rest and residue of his estate,

to Hershey Trust Company, of Hershey, Pennsylvania, in trust, nevertheless, to hold, invest and reinvest in such securities […] to pay the income thereof in semi-annual installments to the School District of Derry Township, Dauphin County, Pennsylvania, for the use of said School District, particularly for the purpose of assisting such Township to relieve the tax burden for the upkeep and maintenance of the public school in said District.

This final testament further manifests M.S.’s focus on Derry Township as the campus of The Hershey Industrial School (that is, the Hersheys’ Children’s Home Campus), as well as his focus on the third core component of The Hershey Industrial School – Education.

 

Legal Structure – The Hershey Industrial School Trust

 

The Hershey Industrial School Trust is the well designed legal structure the Hersheys created to ensure their continued control of their philanthropy during their lifetime and the legal relationships such structure created to ensure that the Hersheys’ philanthropy would survive in perpetuity. The Trust was, and remains, of central importance to the Hersheys’ philanthropy.

 

Picture 1:   John Snyder, Legal Architect of The Hershey Industrial School [1]

In 1891, M.S. formed his association with John Snyder.  Snyder, as well as M.S.’s grandfather, Jacob Hershey (of Derry Township), a Bishop of the Reformed Mennonite Church, both served on the board of the Emaus Trust.  The Emaus Trust was a children’s home located in Middletown, PA formed by George Frey in the early 1800s. Snyder is the legal architect that M.S. used, among other things, to make his philanthropy (including the “ideal community”) permanent.[2] John Snyder remained primary legal counsel to all Hershey Interests and M.S. up until his death on December 20, 1934.

 

The trust, the legal entity that is utilized to make the Hersheys’ philanthropy (including the “ideal community”) permanent, which has come to be known as The Hershey Industrial School Trust, was formed on April 14, 1910.  While the Hersheys signed and dated it November 15, 1909, April 14, 1910 was the date on which all the other parties to the Original Deed of Trust executed such document.  The name of the Trust (The Hershey Industrial School) reflects the overall composition of the School (which includes the “ideal community”) formed pursuant to the Original Deed of Trust.

 

Deed of Trust

 

On November 15, 1909, M.S. and Kitty executed an Indenture dated November 15, 1909 as settlors of the resulting trust. On April 14, 1910, such Indenture was accepted by the Hershey Trust Company as the Trustee and a number of individuals as the original Managers. On July 7, 1910, the Indenture was recorded in the Office of the Recorder of Deeds of Dauphin County, Pennsylvania. Though this instrument is self-designated an indenture, it has for some time been referred to as the “Deed of Trust.” The trust formed as a result of said Indenture was actually formed as a permanent, legal entity when the Hershey Trust Company and the initial Managers executed the Original Deed of Trust and thereby accepted the trust and duties imposed upon them under said Indenture. The Original Deed of Trust became binding on third parties when it was filed in the public records in the Office of the Recorder of Deeds of Dauphin County, Pennsylvania on July 7, 1910. This is the “Original Deed of Trust.” The Deed of Trust has been modified from time to time. For our purposes in describing the Hersheys’ philanthropy, we refer primarily to Milton Hershey’s Deed of Trust – that is, the Deed of Trust as in effect upon his death in 1945.

In late 1919, the Court of Common Pleas of Dauphin County, Pennsylvania entered a decree which granted the incorporation of the Managers as The Hershey Industrial School, a Pennsylvania nonprofit corporation, a corporation of the first class, pursuant to Paragraph 28 of the Deed of Trust and said “1919 Decree.” As a result, the Managers received court permission and did incorporate as The Hershey Industrial School, a Pennsylvania nonprofit corporation. The incorporation of the Managers is the third instance where the Deed of Trust names a separate and distinct entity “The Hershey Industrial School.” Following the incorporation of the Managers, each of three separate and distinct entities, that is, the School, the school, and the Managers, have the name “The Hershey Industrial School.”

On October 27, 1933, a Petition for Modification of Trust, dated October 27, 1933, was filed in the Court of Common Pleas of Dauphin County, Pennsylvania, in Equity, Equity Docket, Number 1096, by The Hershey Industrial School, a nonprofit corporation as the petitioner, by leave of the Attorney General. A Decree dated October 30, 1933 was issued in response to the Petition by the Court of Common Pleas of Dauphin County, Pennsylvania, in Equity. The decree authorized revisions which modified the Original Deed of Trust (1) to expand the class of orphans served by the school, as follows: (a) the maximum age range for admission of poor, healthy, white male orphans was expanded from between four and eight years of age to between four and fourteen years of age, and (b) otherwise qualified boys whose mothers were deceased but whose fathers were still living were made eligible for admission, and (2) to add the provision, “No person employed by the school, in any capacity, in connection with which any compensation or expenses are directly or indirectly paid, shall at the same time serve as a member of the Managers of The Hershey Industrial School,” as Paragraph 29 of the Deed of Trust.  M.S. joined in said 1933 Petition.

Following Milton Hershey’s death in 1945, various Deed of Trust modifications or deviations occurred, or were attempted, including those in 1951, 1953, 1963, 1968, 1970, 1976, 1990, 1998, 1999, 2000 and 2002. These Deed of Trust modifications or deviations are the subject of and discussed separately. To avoid any confusion between that which the Hersheys intended and subsequent modifications of the Original Deed of Trust, the phrase “Milton Hershey’s Deed of Trust” as referenced herein means the Original Deed of Trust as modified during M.S.’s lifetime, first, on December 30, 1919 with the incorporation of the Managers and second, on October 30, 1933, with the expansion of the class of orphans served and the addition of Paragraph 29. Moreover, the term “Deed of Trust” means the Original Deed of Trust, as revised through authority of the court and now evidenced by the 1976 Second Restated Deed of Trust.^[3]

 

Trust Structure and Governance

 

The “Trust” is the legal entity created pursuant to the Deed of Trust and known as “The Hershey Industrial School Trust.”  The Trust has two fiduciaries: the Trustee and the Managers. Beyond the parties described in Milton Hershey’s Deed of Trust, there is created pursuant to the Original Deed of Trust first, in the beginning of the Original Deed of Trust, an “institution” designated as the “School,” and then, another separate and distinct institution, which is referred to herein as the “school.” Both are named under Milton Hershey’s Deed of Trust as “The Hershey Industrial School.” As with all trusts, it also has beneficiaries.

 

Trustee

 

The first fiduciary, the Trustee, is the Hershey Trust Company of Hershey, Derry Township, Dauphin County, PA, which is designated “Trustee” and “party of the second part” under the Deed of Trust. The Trustee, among other things, owns legal title to the Trust assets, which, following M.S.’s death, includes the stock of the Hershey Trust Company.  As with any corporation, the “Board of Directors” of the Trustee is selected by the shareholders of the Hershey Trust Company. During his life, M.S. reserved to himself the right to vote the stock of the Hershey Trust Company as a shareholder and pursuant to the 1935 Living Trust of Milton Hershey. Thus, during his lifetime M.S. controlled the Trust by determining who comprised the HTC Board of Directors. Upon his death, the Hershey Trust Company Board of Directors became the successor to M.S. and as a group selects their own successors as members of the Hershey Trust Company Board of Directors. 

The Trustee through its Board of Directors selects the Managers from the HTC Board of Directors – that is, from amongst its own members.

 

Managers and Board of Managers

 

The Trust has a second fiduciary called the “Managers.” The third part of Milton Hershey’s Deed of Trust begins at Paragraph 22 and is focused primarily on the Managers or operating fiduciary.  These provisions describe responsibilities of the Managers, as well as certain selection, organizational, and related matters. As reflected in Diagram 1, each of the School, the school and the Managers is a separate entity which shares the same name – “The Hershey Industrial School” as provided in the Deed of Trust. The Managers are the operating fiduciaries of the Trust. Milton Hershey’s Deed of Trust provides that the successors to the initial Managers shall be selected from the HTC Board of Directors by the Trustee. From April 14, 1910, the date on which the original Managers accepted under the Deed of Trust, through December 29, 1919, “Managers,” as a term used in Milton Hershey’s Deed of Trust, means the individual Managers named as “parties of the third part” and their respective successors. On and after December 30, 1919, “Managers,” as a term used in Milton Hershey’s Deed of Trust, means The Hershey Industrial School, a Pennsylvania nonprofit corporation,^[4] as successor in interest to the individual Managers pursuant to Paragraph 28 of the Deed of Trust and the 1919 Decree.

The “Board of Managers” as a term in the Deed of Trust, means that from April 14, 1910 through December 29, 1919, the individual Managers named in the Original Deed of Trust and their respective successors, collectively as a fiduciary under the Deed of Trust, who were from amongst their group to elect officers of the Managers following a corporate governance model. On and after December 30, 1919, the “Board of Managers” as a term in the Deed of Trust means the Board of Directors of The Hershey Industrial School, a Pennsylvania nonprofit corporation, collectively, who are from among their group to elect certain officers of the Managers. Members of the Board of Managers are selected by the Board of Directors of the Trustee from amongst its own members.

The Managers are the operating fiduciaries with responsibility for the management of the School or the Hersheys’ Children’s Home (which includes the “ideal community” commonly referenced by those who lived in Hershey), and is the first “institution” founded and endowed in perpetuity by the Hersheys pursuant to their Deed of Trust at the beginning of the Original Deed of Trust. It is the very same “institution” into which orphans are admitted pursuant to Milton Hershey’s Deed of Trust. This institution is an expansive operation for which the Managers are the operating fiduciaries with responsibilities that include day-to-day operation of the Hersheys’ Children’s Home. Inasmuch as it is so expansive and includes substantially all of Derry Township (as well as land acquired for School purposes that is adjoining or conveniently near School property), the Managers are the de facto governing body of the Hersheys’ Children’s Home Campus. While other townships or communities have governmental structures that perform the functions that the Managers perform in Derry Township, M.S., as a Mennonite, did not believe government was appropriate in the context of the Hersheys’ Children’s Home.

By selecting senior officers of the underlying operations of the Hersheys’ Children’s Home (e.g., President of the Hershey Chocolate Company, President of the Hershey Trust Company, etc.) to be members of the Board of Managers, and holding each such Manager responsible to each Current Beneficiary of the Trust (through a combination of the Deed of Trust and each Indenture), this structure requires that potentially conflicting objectives of the underlying community, business and etc. be servient to the best interests of each Current Beneficiary as all of the components of the Hersheys’ Children’s Home are assets of the Trust intended to benefit the Beneficiaries. Moreover, each Manager has a solemn fiduciary duty to each Current Beneficiary due to the Deed of Trust and Indenturing. These legal obligations of the Managers to the Beneficiaries are the ultimate determinant, which mandate that the Managers make only decisions that are in the best interests of each Current Beneficiary.

 

Preservation of Control During Milton Hershey’s Lifetime

 

During M.S.’s life he reserved to himself the right to vote the stock of the Hershey Trust Company as a shareholder and pursuant to the 1935 Living Trust of Milton Hershey. Thus, during his lifetime M.S. controlled the Trust by determining who comprised the HTC Board of Directors. The Trustee through its board of directors selects the Managers from the HTC Board of Directors. This ingenious preservation of control over the Trust was achieved by retaining the right to vote the Hershey Trust Company stock and thus selection of the members of the HTC Board of Directors, from which the Managers must be selected.

In the end, when one considers that the Hersheys were the settlers of the Trust and the Hersheys’ Children’s Home was at all times controlled by M.S., one must conclude that the best evidence of what the Hersheys intended in the language of Milton Hershey’s Deed of Trust is what M.S. indeed created during his lifetime.  M.S. was very much aware that he was carrying out the terms of his own will while still alive and believed that everything would continue as he intended after he died just as if he were still alive and in control.

Upon his death, the Hershey Trust Company Board of Directors became the successor to M.S. and as a group selects their own successors as members of the Hershey Trust Company Board of Directors. 

 

The “institution” Designated the “School”

 

The first part of Milton Hershey’s Deed of Trust runs from the beginning of the Deed of Trust through Paragraph 10. This first part (1) creates the Trust, the Managers, and the School, and (2) provides for the operation of the School. The School includes the ideal community and the school.  As reflected in Diagram 1, each of the School, the school and the Managers is a separate entity which shares the same name – “The Hershey Industrial School” as provided in the Deed of Trust.

Beyond the parties to, and described in, Milton Hershey’s Deed of Trust, there is created pursuant to the Original Deed of Trust an “institution” designated as the “School.”  “School” as used in the Deed of Trust means the “institution” founded and endowed in perpetuity as contemplated by the first recital (and other provisions) of the Original Deed of Trust, known as “The Hershey Industrial School” located upon land in Derry Township and land adjoining or conveniently near to School property.

On a more substantive level, the School is the Hersheys’ Children’s Home and includes the Hersheys’ Children’s Home Campus (including Hershey, PA or the “ideal community”), Hershey Estates, the Hershey Chocolate Company and its successors, the School Family, The Hershey Industrial School Alumni Association, and the “school.” The M.S. Hershey Foundation and the 1945 Residual Derry Township School District Trust are likewise included as part of the School as subsidiaries or affiliates within the Trust and part of the “permanent institution” (which includes the “ideal community” also known as the “community of mutual interests”), similar to Hershey Estates but in a different legal form. The use of the phrase “Hersheys’ Children’s Home” is to describe a children’s home of the type, nature, and programs intended by the Hersheys under Milton Hershey’s Deed of Trust, giving full effect to the resources of the Trust. The Hersheys’ Children Home is the School and all of its components, which is a children’s home for the Current Beneficiaries (dependent, at-risk children, who are in need of substantially year round institutional care by a children’s home such as that intended by the Hersheys for the full development of each Current Beneficiary as a whole person according to such person’s unique abilities, interests, and commitment). Moreover, the phrase “Hersheys’ Children’s Home Campus” means substantially all of Derry Township and the surrounding land that from time to time is acquired for School purposes and adjoins or is conveniently near School property, which of course includes the community which serves as the “home” of the Current Beneficiaries. The overall relationships formed as a result of Milton Hershey’s Deed of Trust and the Indentures are illustrated in Diagram 3: Control of The Hershey Industrial School – 1910 – 1945. All activities of the Hershey Interests principally benefit the School.

 

 

The “school,” School Family and Milton Hershey’s Alumni Association

 

There are three resources within the School that serve the Resident Beneficiaries and Non-Resident Beneficiaries directly and are not expressly shared with others affected by the Hersheys’ philanthropy. These are the “school,” the School Family, and Milton Hershey’s Alumni Association. In contrast with the “School,” the “school” means the residential, educational and other related facilities, and employees that directly serve the Resident Beneficiaries and Non-Resident Beneficiaries; the school comprises a major component of the School.  The school is the second “institution” referenced in the Deed of Trust; it is introduced in Paragraph 11 of Milton Hershey’s Deed of Trust and organized pursuant to Paragraph 13. Section 3.6(a) describes the school in detail.

 

Profit Driven Economic Engines

 

The Hershey Chocolate Corporation and Hershey Corporation are the profit driven economic engines of the Trust. Due to the broad reach through the markets for their respective products, the profits that fueled the Hersheys’ philanthropy were derived from the broader United States and to some extent international markets, thereby distributing the cost of their philanthropy to lands well beyond Hershey, Pa. in exchange for chocolate and sugar products. After 1927, profits from primarily the Hershey Corporation (and to a lesser extent, the Hershey Chocolate Corporation) funded the large construction projects of the Trust which were prevalent during the period of great expansion of The Hershey Industrial School.

 

Hershey Estates

 

Knowing that The Hershey Industrial School would have an expansive set of responsibilities, the Hersheys established entities through which to centralize the performance and management of those responsibilities. Hershey Estates centralizes the ownership, operation and management of all of the non-chocolate interests of The Hershey Industrial School, which includes the ideal community of Hershey. The businesses operated by Hershey Estates include baking, coal, cold storage, dairy, department store, electric, experimental candy kitchen, feed and grain, farms, farming implements, filling station, garage, greenhouse and nursery, hospital, laundry, real estate, sewage, telephone, transit, water, hotel, as well as community building, cemetery, inn, theatre, country club, juvenile golf course, museum, park, park golf club, rose garden, and zoo. This list well illustrates the extensive scope of the Hershey Estates. The objective is to operate Hershey Estates without generating a profit but minimizing losses, to the extent possible. Hershey Estates is part of the School under Milton Hershey’s Deed of Trust. As such, it had the entire Trust behind it and did not require its own capitalization to succeed in fulfilling its unique role within the Hersheys’ philanthropy. 

In the end, Hershey Estates is that part of the School that operates the School (including the “ideal community”).  The centralization of all of these activities is a logical and efficient solution.  That is, the overall endeavor to have a self-reliant structure – or “institution” – that utilizes all of its own resources to their maximum benefit in order to achieve optimal economic, logistical, and most importantly, philanthropic results is achieved, in part, through Hershey Estates.  Hershey Estates was formed with a clear set of purposes:  that is, to consolidate the activities that were not entirely profit driven that served The Hershey Industrial School (that is, the Hersheys’ Children’s Home) and the Beneficiaries, which service revolved around designing, creating and preserving a self-reliant campus and ranged from producing the food, utilities and other resources to be consumed, to providing a community to which the Beneficiaries would belong, to providing Education.  Hershey Estates is the entity that oversees most, if not all, of the non-profit driven activities that constitute The Hershey Industrial School and for which the Managers have day to day operating responsibility.  The management and operation of other components like the Hershey Chocolate Corporation and the Derry Township School System were also directed by the Managers due to the Trust’s ownership and/or control of these and other components.  All of the industrial activities of the Community that are related to the Hershey Interests, other than the Hershey Chocolate Corporation, come under Hershey Estates, and, like the school, under the management of the Board of Managers pursuant to Milton Hershey’s Deed of Trust.

Moreover, Hershey Estates owns substantially all of the land “being the town of Hershey” and upon which school facilities were located. The school facilities were part of Hershey, the “ideal community,” which was owned and operated for the Trust as part of the School through Hershey Estates.

 

 

M.S. Hershey Foundation and 1945 Testamentary Trust

 

The M.S. Hershey Foundation and the 1945 Residual Derry Township School District Trust are part of the School as subsidiaries or affiliates within the Trust and part of the “permanent institution” (which includes the “ideal community” also known as the “community of mutual interests”), similar to Hershey Estates but in a different legal form.

The purposes of the M.S. Hershey Foundation, as stated in the Agreement of Trust which established it, are three:

• To establish and maintain “one or more educational institutions in Derry Township.”
• To support the public schools of Derry Township and to improve and elevate “the standard of education” -- indicating a “higher” level of instruction than provided by the secondary school.
• To advance “the vocational, cultural or professional education of any resident of Derry Township.”

From 1935 (the year of its creation) through 1945, the Boards of The Hershey Industrial School (that is, the Managers), the Hershey Trust Company (the Trustee) and the M.S. Hershey Foundation (the 1935 HJC Trust) were identical:

William Earnest: 1935 – 1958	S.C. Stecher:          1935 – 1939
Ezra Hershey:     1935 – 1949	Charles Ziegler:       1936 – 1957
M.S. Hershey:     1935 – 1945	William Crouse:       1937 – 1945
Paris Hershey:     1935 – 1956	J.R. Hoffman:           1938 – 1944
William Murrie:     1935 – 1947	Arthur Whiteman:     1939 – 1974
P.A. Staples:       1935 – 1956	Oscar Bordner:         1940 – 1948

 

This manifests efforts of The Hershey Industrial School to allocate resources of the Trust to specific initiatives that both improved the School and directly benefited the Beneficiaries, while at the same time retaining control of these resources as expected, through the Managers.

 

In 1945 upon M.S.’s death a residual trust was formed pursuant to Milton Hershey’s 1944 Final Will through which M.S. bequeathed all of the rest and residue of his estate,

to Hershey Trust Company, of Hershey, Pennsylvania, in trust, nevertheless, to hold, invest and reinvest in such securities as may seem best in the judgment of the Directors of said Trust Company, and order and direct my said Trustee to pay the income thereof in semi-annual installments to the School District of Derry Township, Dauphin County, Pennsylvania, for the use of said School District, particularly for the purpose of assisting such Township to relieve the tax burden for the upkeep and maintenance of the public school in said District.

This final testament further evidences M.S.’s focus on Derry Township as the core or central focus of the Hersheys’ Children’s Home Campus.

 

The Hershey Industrial School Trust, the M.S. Hershey Foundation, and the 1945 Residual Derry Township School District Trust share the Hershey Trust Company as a common Trustee, and the managing fiduciary of each of which is controlled by the Directors of the Hershey Trust Company. The Managers must be selected from among the Directors of the Hershey Trust Company. The Directors of the Hershey Trust Company are the managing fiduciaries of the 1945 Residual Derry Township School District Trust. All of the uses contemplated by the M.S. Hershey Foundation were likewise limited to Derry Township and its residents and the “managers” of the M.S. Hershey Foundation are to be selected in the same manner as the Managers – that is, by the Trustee from its own Directors. In essence, all three entities were controlled by the Managers. That is, the M.S. Hershey Foundation and the 1945 Residual Derry Township School District Trust are like subsidiaries or affiliates within the Trust and part of the “permanent institution” (which includes the “ideal community” also known as the “community of mutual interests”), similar to Hershey Estates but in a different legal form.

 

Hershey Junior College

 

On September 14, 1938, the Hershey Junior College was opened in the Community Building. The original plan was to make the Hershey Junior College, and indeed it was from the very beginning, a division of The Hershey Industrial School. The Hershey Junior College was unique in that it was administered by the public school board. While it was administered by the public school system, the Hershey Junior College did nonetheless become part of The Hershey Industrial School; its students were not limited to those who were admitted to the School and were students at the “school.” Rather, its students need only be residents of Derry Township. The opening of the Hershey Junior College marked a return to the earlier plan of students of the public school system and students of the school receiving their last years of formal education together. This recipe continued for more than twenty years.

The Hershey Junior College was part of the Education component of the School and in Milton Hershey’s Deed of Trust it is understood that as time goes on, the requisite level of education that society will require will go up. Accordingly, M.S. would not have thought it unique. While it may have been unique as compared to other school districts, it was fully consistent with his approach to Education in Derry Township. Any facility that provided formal education in Derry Township was either part of the Derry Township public school system or part of the school. Furthermore, while Hershey Junior College was administered by the public school board, its employees were employed by Hershey Estates. Following the 1934 opening of the Junior-Senior High School on the Hill, Hershey Junior College served as the perfect return to a joint public school to which residents of Derry Township and Current Beneficiaries would learn and develop together and form lasting relationships. By making it free to all Derry Township residents, M.S. gave each non-Current Beneficiary Derry Township resident an economic incentive to go to higher education with Current Beneficiaries who were Scholars and therefore, likely to become leaders in the School Family and possibly within the Hershey Interests.

 

The “school”

 

The “school” (that is, the second institution referenced in the Deed of Trust) is introduced in Paragraph 11, and provisions related to the school continue through Paragraph 21. These provisions provide for the creation, organization, and operation of the “school” within the School. As reflected in Diagram 1, each of the School, the school and the Managers is a separate entity which shares the same name – “The Hershey Industrial School” as provided in the Deed of Trust. In contrast with the term “School,” the term “school” means the residential, educational and other related facilities, and employees that directly serve the Resident Beneficiaries and Non-Resident Beneficiaries, which comprise a major component of the School.  This is the second “institution” introduced in Paragraph 11 of Milton Hershey’s Deed of Trust and organized pursuant to Paragraph 13.  There are three resources within the School that serve the Resident Beneficiaries and Non-Resident Beneficiaries directly and are not expressly shared with others affected by the Hersheys’ philanthropy. These are the “school,” the School Family, and Milton Hershey’s Alumni Association.

 

Beneficiaries of the Trust – Requirements for Admission

 

The Trust exists for the benefit of, and each of the fiduciaries of the Trust is required to act and exercise his or her authority in the best interests of, the Beneficiaries of the Trust. Consequently, the Beneficiaries of the Trust represent an important component of the Trust.

The Trust is a charitable trust. In some respects, charitable trusts differ from private trusts. One difference requires discussion in the context of identifying the beneficiaries of the Trust. Trustees of charitable trusts are more likely to experience frequent “unreasonable or vexatious litigation” brought by various members of a large and shifting class of the public. To avoid this problem, courts apply a legal fiction not available in cases involving private trusts. The legal fiction is that the public is the beneficiary of a charitable trust, and this justifies the selection of the Attorney General, who is the governmental officer whose duties include the protection of the rights of the people of the state in general, as the protector, supervisor, and enforcer of charitable trusts. The classic beneficiaries of charitable trusts are usually members of a shifting class of the public. This raises concern that if any member of this class could bring suit to enforce the charitable trust, such charitable trust might frequently be subjected to unreasonable or vexatious litigation. It is for the reason of avoiding this undesirable result that there is vested in a single authority the discretion and power to enforce such trusts rather than leaving the matter to the numerous, changing and uncertain numbers of the group directly to be aided. This legal fiction varies from the traditional analysis used to determine the beneficiaries of a trust. However, application of this legal fiction does not change the fact that each trust, whether charitable or otherwise, has beneficiaries by definition. This is expressly acknowledged by the Office of the Attorney General and the Dauphin County Orphans’ Court.

A “beneficiary” of a trust includes a person who has any present or future interest in the trust, vested or contingent, and in relation to charitable trusts, also includes each person entitled to enforce the trust, such as the Attorney General.^[5] Note that this contemplates at least two sets of beneficiaries in the context of charitable trusts, just as has been articulated above. Thus, the remainder of this section is focused on the first (that is, the classic) meaning of “beneficiary” separate and apart from, but nonetheless respecting, the legal fiction described above, which utilizes the additional set of beneficiaries in the context of charitable trusts to achieve the stated social objectives.

There are current and prospective beneficiaries of the Trust. To determine who is a beneficiary, one must first determine the requirements for admission to the School under the Deed of Trust. The “Requirements for Admission” under Milton Hershey’s Deed of Trust are set forth under The School. 

 

Picture 2:   The Boys Admitted to The Hershey Industrial School in 1914 [6]

In 1914, there were 40 students admitted to The Hershey Industrial School.  The youngest boy in this picture could have been 4 years old.  Inasmuch as the oldest child admitted in 1910 could not have exceeded 8 years of age, the oldest boy in this picture could not have been older than 12 years old.

 

 

Challenges Associated with the Hersheys’ Philanthropy

There are a number of challenges presented when fulfilling the Hersheys’ philanthropy. When seeking the perpetual fulfillment of the Hersheys’ philanthropy, it is helpful to keep in mind some of the associated challenges, as well as the primary forces adversely affecting fulfillment of the Hersheys’ philanthropy. These primary forces can be broken down into separate causes, which make perpetual success of the Hersheys’ philanthropy very challenging. The following is an overview.

 

1.                  Original Structure^[1]

By way of introduction, the Deed of Trust creates three separate and distinct entities each of which was originally named “The Hershey Industrial School,” and is now named “Milton Hershey School.” These three entities are the “School” (which once included the “ideal community”), the institution that is referred to in my books as the “school,” and the Managers, or operating fiduciary of the Trust, who were particularly important and historically selected in a manner that reflected a time when the School included the town of Hershey and the various businesses referred to as the Hershey Interests. The Managers were known as The Hershey Industrial School, a Pennsylvania nonprofit corporation, and are now known as the “Milton Hershey School, a Pennsylvania nonprofit corporation”. Both the “School” and the “school” are unincorporated, but each exists as a separate institution organized and named through the Deed of Trust. This is reflected in three general sections of the Deed of Trust. 

The first part of Milton Hershey’s Deed of Trust runs from the beginning of the Deed of Trust through Paragraph 10. This first part (1) creates the Trust, the Managers, and the School, and (2) provides for the operation of the School. The School includes the school, and once also included the town of Hershey and the various businesses referred to as the Hershey Interests.  The “school” (as I refer to it in my books and as M.S. frequently referred to it) is the second institution referenced in the Deed of Trust introduced in Paragraph 11; provisions related to the school begin at Paragraph 11 and continue through Paragraph 21. These provisions provide for the creation, organization, and operation of the “school” within the School. The third part of Milton Hershey’s Deed of Trust begins at Paragraph 22 and is focused primarily on the Managers or operating fiduciary.  These provisions describe responsibilities of the Managers, as well as certain selection, organizational, and related matters. Some of the language reflects a time when the School included the town of Hershey and the various businesses referred to as the Hershey Interests. As reflected in Diagram 1, each of the School, the school and the Managers is a separate entity which shares the same name – “The Hershey Industrial School” as provided in the Deed of Trust.

That is, The Hershey Industrial School was built upon an infrastructure comprised of these three components made permanent through the Trust.

Hershey	represents the Community of Hershey, PA., including Derry Township and certain surrounding land, owned on behalf of The Hershey Industrial School.
Industrial	represents the various businesses, including the Hershey Chocolate Company which the Hersheys created. The funding for the businesses came primarily from the Hersheys and the Trust.
School	represents the education system which the Hersheys created within Derry Township, including those that were public and those that were not.  The funding for these resources came primarily from the Hersheys and the Trust, as well as the Community of Hershey, primarily through taxes.

Pursuant to the Hersheys’ original intent, the original structure of The Hershey Industrial School (which continued until sometime in the 1960s) could be diagramed as set forth in Diagram 1: The Original Structure of The Hershey Industrial School – 1945, below. This reflects an interdependent structure designed to benefit the beneficiaries of the Trust, as well as those who participated in The Hershey Industrial School.

 

Diagram 5: The Original Structure of The Hershey Industrial School – 1945

 

 

 

Today, however, the Milton Hershey School looks something like this:

 

These visual overviews provide general insight into the fact that things are fundamentally different. The next few sections explain some of the reasons why this fundamental change occurred, noting that the Community of Hershey and various businesses within the Hershey Interests are no longer part of the Milton Hershey School.

 

2.                  Raising Dependent Children

Raising children is a challenge even if they are yours biologically and for which you have a legal responsibility. In the context of raising poor dependent children with whom the Community of Hershey may have no other relationship, this presents ongoing burdens of finding adults who genuinely want to do this notwithstanding the demands of raising other people’s children who by their nature require more than many children. After all, they are coming to Hershey as poor dependent children.

Moreover, the day to day operation of a children’s home is far from glamorous. Most philanthropies receive immediate positive public response. Public response to a children’s home is more often mixed, particularly where the achievement of such philanthropy can directly affect the Community that was built to help deliver such philanthropy. While financial investment in, improvements to and expansion of employment as part of the operation of The Hershey Industrial School and other aspects served to greatly benefit the Community and its residents, some aspects of the Hersheys’ philanthropy worked at cross purposes to the Community residents’ personal interests.

Originally, however, Community support for the Hersheys’ philanthropy was essential to success because it was a fundamental component of the original structure, cost of operation and intended benefits to the Current Beneficiaries to be derived through The Hershey Industrial School. While the Hersheys were able to cultivate strong Community support and loyalty in the early years prior to the late 1920s, this changed.

The Great Depression and Milton Hershey’s strong desire to help and be of service to others brought with them a rapid expansion of work force and residents during the 1930s. This resulted in a fundamental shift in the population that comprised the Community. For every original supportive and loyal resident and/or employee of The Hershey Industrial School, there came two new employees who were not as supportive and loyal. In addition, the Great Depression spurred a great fear and panic in the hearts of most American workers due to the average unemployment of approximately 25% throughout America. This generally caused a major divide between labor and management/ownership of American businesses. The result was intense interest in labor unions and collective bargaining so as to provide American labor with greater influence on their compensation, working conditions and conditions of employment.

While Hershey had already established very favorable employee compensation (including up to 25% profit sharing) and working conditions, the new laborers had some continuing concern over conditions of employment – such as the circumstances under which an employee could loose his or her job. Thus, while the Hersheys’ philanthropy was designed to be of service to them and the Current Beneficiaries, labor in Hershey wanted increased control over compensation, working conditions and conditions of employment.

Pitting this American effort to protect labor against the Hershey Interests forced (by virtue of the Federal laws protecting collective bargaining) tradeoffs between the best interests of the workers versus the best interests of the Current Beneficiaries. While the process of making tradeoffs was always required to be addressed by the Board of Managers – that is, to balance the competing best interests of all affected by the Hersheys’ philanthropy – ultimately, the Managers were required as their first priority to protect and defend the best interests of the Current Beneficiaries (particularly while they were minors).

That is, all decisions made by the Managers had to be in the best interests of the Current Beneficiaries. This sometimes gave rise to less than optimal results for the Community residents and employees of the Hershey Interests who were not former students of the school.

 

3.                  Competition Among Original Participants

Competition among all affected individuals naturally resulted, because the Community residents, employees of the Hershey Interests and the Current Beneficiaries shared The Hershey Industrial School, albeit in different legal capacities. Competition for the profits of the Hershey Interests arose as labor sought increased control over compensation, working conditions and conditions of employment. Certain aspects of the Hersheys’ philanthropy such as its intense focus on and pursuit of Christian principles and the requirement of maximizing profits to achieve the greater good of their philanthropy for orphans were in direct competition with the separately determined objectives of the workers. Moreover, internships for high school students (from Derry Township and Milton Hershey School) and post graduation jobs were in direct competition with the adults who worked in the Hershey Interests, as well as their children as and when their children sought employment.

Also, there was growing conflict and competition between students attending Derry Township schools and those attending Milton Hershey School. Some examples are sports, academics, dating,^[2] and jobs upon reaching employment age. Among other things, this gave rise to physical fights among the so called “townies” from Derry Township schools and the “cows” or “home boys” from Milton Hershey School. This growing tension played out at the Manager level too. Managers had been selected by the Hersheys to play a role in the original structure and thus these Managers had responsibilities (and personal interests) that reflected their original role. Once the original structure was modified, shared or common interests became interests with insurmountable conflict.

Certain fundamental elements of change began while Milton Hershey was alive, but he did not embrace them. Eventually, this would evolve into a clear battle for control of the Trust and the direction it would take, which skyrocketed in the 1980s following the addition of Rod Pera^[3] to the Board of Managers and the death of four key Managers within a 12 month period around 1988. In regard to the type of individual who should not become a Manager, Rod Pera is probably the “poster child.” 

The original composition of the Managers (which was based on the original structure that ceased to exist in the 1970s) and the fundamental changes that occurred in the 1980s and 1990s would lead to decisions that favored residents of Hershey and workers at the Hershey Interests to the clear detriment of the Current Beneficiaries. This included policies forcing graduates of Milton Hershey School to return only to visit but not work or live in Hershey. These policies were supported by an illusion of “not wanting to favor those who graduated from Milton Hershey School,” as that would be fundamentally unfair. Setting aside for the moment the fact that the Managers have fiduciary duties to such graduates of Milton Hershey School and no comparable fiduciary duties to the other residents of Hershey, this was nothing less than a clear policy to favor residents of Hershey and employees of the Hershey Interests (and their children) by excluding graduates of Milton Hershey School on a wholesale basis. If this were not the case, no policy would have been necessary other than to not favor anyone.

Moreover, as a Community, Hershey residents sought to be self determined, for reasons similar to their need to have greater control over compensation, working conditions and conditions of employment at the Hershey Interests. The fiduciary duty of each Manager to make decisions that are in the best interests of the Current Beneficiaries of the Trust in many cases may give rise to decisions that are very different from that which the residents want for themselves and their children.

All things considered, the growing efforts of the workers at the Hershey Interests, and residents of the Community to self determine their future were, over time, making it clearer that (i) the Community was not fulfilling the Hersheys’ intent, (ii) this was primarily a matter of individual self-interest and self-determination and (iii) this was outside the control of the Managers. The overwhelming cost of supporting the Community as part of The Hershey Industrial School continued to increase while the Community sought to achieve greater independence from the control of the Managers. In fact, one source of creating an imbalance in the cost of the Community versus the overall philanthropy was a Managers decision in the late 1940s (following Milton Hersheys’ death) that land constituting part of The Hershey Industrial School could be sold to individuals that were not part of the Hersheys’ philanthropy; that is, they (i) did not work for any of the Hershey Interests,  (ii) were not originally from Hershey, and (iii) they had not been admitted to the school. Once this was permitted, growth of the Community could be at a rate that exceeded the natural growth of the businesses and the school. Thus, the growth in cost of the Community could and did become disproportionately high relative to the other components of the School.

Eventually, the Board of Managers was forced to acknowledge that the Community component of Milton Hershey School was not within their control and it was failing to serve the Hersheys’ philanthropy. Through organized labor and other means (including the sale of School land to non-participants in the Hersheys’ philanthropy), the Community continued to assert objectives that were at odds with the best interests of the Current Beneficiaries.^[4] The increasing cost of supporting the Community as part of Milton Hershey School lost its direct connection with serving the best interests of the Current Beneficiaries. This phenomenon began during the 1930s and manifested itself is a number of ways as the Managers sought to balance the Community’s interests with those of the Current Beneficiaries. In the end, preserving all three components of the original School structure proved impossible and beyond the Managers control.

After some unauthorized changes were made in efforts to address Community interests,^[5] beginning in 1951 changes began to occur that manifest at least three primary objectives. The overall import of these was to facilitate the reinvention of the Trust over time.

First, the change in the name signaled more than what was said. It also contemplated elimination over time of the original structure of the Hersheys’ philanthropy. Second, the 1951 Petition also signaled an effort to communicate a new interpretation of the Hersheys’ philanthropy, one not endorsed by the Hersheys. That is, language in the 1951 Petition seeks to imply that the School, the school and the Managers are the same, when in fact they are three separate entities. This marks the beginning of an argument that is not true according to the Hersheys’ intent. However, this would support a result that Paul Reed had sought but with which Milton Hershey was not in agreement.

The language in the 1951 Petition was particularly disingenuous because the 1951 Petition stated that it only sought to change the name of “The Hershey Industrial School,” which on its face seemed to be the right thing to do. But far more was being sought. The false illusion that there was only one entity created by the Hersheys was a change in the Hersheys’ philanthropy that varied materially from their intent.^[6] Eventually, the pre-reform Board of Managers would come to expressly claim that they are the beneficiaries of the Trust and that the true beneficiaries of the Trust are only those individuals that they serve, but not beneficiaries of the Trust. This would also facilitate the illusion that the Managers had more discretion and control of the Trust than was in fact intended by the Hersheys.

The third objective was to facilitate a different construction of the school; that is, that the school was simply a school named after Milton Hershey. Over time, the relevance of, and the desire to understand the import of, the name The Hershey Industrial School and the reasons why the Hersheys would choose such a name would fade. This would open the possibility of a different School in years to come.

Eventually, these pressures or competing interests manifested themselves in other intrusive ways such as these examples:

·         In 1953, the Managers’ eliminated Indenturing (without legal process or authority from the Court) though Indenturing was expressly required by Paragraph 15 of the 1951 Deed of Trust. During the 1953 labor strike, the tension between workers for wages and the Hersheys’ philanthropy was manifest by signs carried by strikers who asked “Why Should We Support the Orphans?” The workers’ signs well reflect one of the most significant conflicting interests that have worked against fulfilling the Hersheys’ philanthropy according to their intent. Indenturing was eliminated by the Board of Managers in tandem with the ending of the 1953 labor strike, which was the longest labor strike up to that point in time.

·         The 1963 Decree’s^[7] effective change in the class of beneficiaries of the Trust without regard to race or gender and without notice and hearing completely ignored the United States Constitution’s requirements that orphans of other race and gender be considered.^[8] It also limited the total number of beneficiaries that the Trust could serve due to reduced funds.

·         In 1968, the Managers announced a new policy of accepting applications for admission to the Milton Hershey School without regard to the racial criteria specified in the Deed of Trust, without having obtained Court authorization.^[9] 

·         In 1970, there were numerous changes to the Deed of Trust effected by the 1970 Decree that (i) altered the class of beneficiaries without regard to gender without notice and hearing and (ii) served to limit the maximum number of children the Trust could serve, because each of these placed restrictions of the Trust’s ability to serve all of the beneficiaries that it would have been obligated to serve had the United States Constitution been observed.^[10] These changes to the Deed of Trust include (1) elimination of all references in the Deed of Trust that restricted admission to the school to “white” orphans, (2) extension of the age of admission to sixteen years (that is, that the child not have reached his 16th birthday), (3) elimination of the requirement in the Deed of Trust that “No orphans shall be admitted until” Indentured, and (4) elimination of the requirement that proceeds from the sale of land be used solely to purchase additional land. 

·         In 1976, there were numerous changes to the Deed of Trust effected by the 1976 Decree that (i) altered the class of beneficiaries without notice and hearing and (ii) served to limit the maximum number of children the Trust could serve, because each of these placed restrictions of the Trust’s ability to serve all of the beneficiaries that it would have been obligated to serve had the United States Constitution been observed.^[11] These changes to the Deed of Trust include (1) elimination of all references to the restriction of admission to “males”, and (2) elimination of the requirement that students be biological orphans, and allowing admission if a child was not receiving adequate parental care from one of his or her natural parents, even though both of the child’s natural parents were living.

·         During the 1960s and 1970s, the Community and other attributes of the School were unbundled from the School, forever removing the Community from eligibility for continued funding from the Trust. This was done without Court approval. ^[12]

o       The discontinuation of Hershey Junior College and reinvention of Hershey Estates as a for profit company were part of this unbundling. Those who worked at the various Hershey Interests then received benefits such as college scholarship programs through their employment, and not as part of the Hersheys’ philanthropy.

o       Simultaneously, the Managers adopted and were enforcing policies that allowed graduates of Milton Hershey School to return only to visit Hershey, PA (the Home intended for, and promised to, them by the Hersheys), but not work or live in Hershey. This and the 1953 unauthorized termination of Indenturing marked an effort to remove Hershey, Pa. as the Home of the Current Beneficiaries. ^[13]

·         In 1990, parts of the newly adopted 21^st Century Initiative are inconsistent with express language of the Deed of Trust, including (but not limited to) the elimination of the vocational program, recruiting students from outside the United States, and the implied shift from “dependent” children to “financially needy” children. While this effort failed, it together with other activities of the Managers manifested the fact that the pre-reform Managers had completely abandoned the Hersheys’ philanthropy. 

·         In 1999, the pre-reform Managers sought approval of the 1999 Cy Pres Petition. While this effort failed, it together with other activities of the pre-reform Managers manifested the fact that the pre-reform Managers had completely abandoned the Hersheys’ philanthropy. 

·         In 2000, at odds with the Hersheys’ original intent is the assertion set forth in the 23^rd Trust Accounting that the Milton Hershey School, a Pennsylvania nonprofit corporation, as the Managers, is the beneficiary of the Trust and accountant, with an interest in the Trust as a 100% beneficiary in trust income and a fiduciary, while also claiming that the true and historically recognized beneficiaries of the Trust are instead beneficiaries of the pre-reform Managers.

·         In 2002, the pre-reform Managers sought to sell Hershey Foods Corporation, the core of the Business Component of the School. While this effort failed, it together with the 1999 Cy Pres Petition manifested the fact that the pre-reform Managers had completely abandoned the Hersheys’ philanthropy.

·         From the mid-1980s through 2002, the pre-reform Managers wasted material sums of money in efforts to reinvent the Trust so as to not fulfill the Hersheys’ original intent, all without Court approval. ^[14]

The heart of the problem over many decades has been the preservation of the Board of Managers selection process which was based on the original structure of The Hershey Industrial School. The Managers began to reinvent such structure shortly after Milton Hershey died. Once the structure was modified, the old selection process gave rise to insurmountable conflict of interests. Moreover, the pre-reform Managers (including Rod Pera and William Lepley) reinvented the selection process by preserving the old and introducing Managers with an agenda designed to take over the Trust and move it away from the Hersheys’ original intent. The preservation of the old selection process and the introduction of the new methodology preserved and created new insurmountable conflict of interests.

 

4.                  Minimum Requirements to Ensure the Hersheys’ Intent is Fulfilled in Perpetuity

There are a number of matters that should be addressed if the Managers are truly committed to fulfilling the Hersheys’ intent in perpetuity. Here is an analysis of a few matters that need to be addressed.

 

(a)               Post 1945 Selection of Managers Gave Rise to Insurmountable Conflicts

Continuing the selection of Managers based upon the original structure of the School, particularly once material changes in the Trust were planned, gave rise to increased conflict of interests over time and these became insurmountable conflicts of interests. Managers who survived Milton Hershey were loyal to the Community and Businesses because their origin as a Manager derived from the original structure, which has not existed since the 1970s and with respect to which there was planned change as early as 1951, if not earlier as manifested by the 1947 incorporation of The Hershey Industrial School Alumni Association. Conflict of interests grew larger as the Trust moved further away from the original structure, yet the method of selecting Managers did not.

When Milton Hershey was alive, it was less important whether an individual Manager was like minded with Milton Hershey. These early Managers did not necessarily share the Hersheys’ intent and approach to life because their role was to manage the entirety of the School, not just the school. Milton Hershey could remove them as a Manager at any time and for any reason, if he deemed removal appropriate. As long as they honored the original structure of The Hershey Industrial School and the high fiduciary duty they owed to each child admitted to the school following Milton Hershey’s death in 1945, they would have been in compliance with the Hersheys’ intent and Pennsylvania law. However, early changes following Milton Hershey’s death demonstrated that the Managers intended to vary from the Hersheys’ intent. If these were meritorious changes, the Managers could and should have followed appropriate process of law in good faith and in an open court so that all who were affected could have been properly represented.

As the school was the final component that remained from the original structure, the views of Managers that were not in accord with the Hersheys’ intent (together with the conflict of interests referenced above) facilitated decisions that compromised the best interests of the Current Beneficiaries. Eventually the Community separated from the School. The conflict of interests of the Managers became insurmountable once the Community was no longer a bona fide component of the School and so long a the selection process sought to preserve the old methodology used by Milton Hershey (that is, the one he used when the original structure of The Hershey Industrial School was still intact). The pre-reform Managers (e.g., Rod Pera and William Lepley) added others who had completely different objectives than to fulfill the Hersheys’ philanthropy.

Going forward, Managers should be selected based upon a continuing effort to fulfill their fiduciary duties, including their obligation to ensure that each is well educated on the Hersheys’ original intent and what the law requires. It is difficult to believe that current decisions are being made that reflect the consistent application of the Hersheys’ intent, particularly if there is no authoritative, written statement of the Hersheys’ intent supported by detailed research.

The Managers should impose requirements to becoming a Manager that reflect the need for each Manager to understand and believe in the core beliefs and the intent of the Hersheys, as well as for each Manager to share the ideals of the Hersheys and a commitment to preserving them. This should be a precondition to becoming, and to continuing as, a Manager. To be clear, I am not criticizing the decisions of current post-reform Managers, I am pointing out a need for Managers to share and be committed to the ideals of the Hersheys as a prerequisite to becoming and remaining a Manager.

In other words, each Manager should be required to covenant and agree to all the terms and conditions of an agreement that sets forth a authoritative, and well researched, statement of that which the Hersheys created, expected, believed and/or intended, including such things as their Guiding Principles, recognition that each person is unique, the overall objectives, recognition of and belief in Christianity, Ten Commandments and the Golden Rule, work ethic, home and school family, alumni are fundamental to success, and the original School structure intended by the Hersheys, as well as agree to live his or her personal and business lives according to the Ten Commandments and the Golden Rule, and to fulfill the School Pledge. At first glance, this may seem odd or even excessive. However, if the Managers do not personally understand and believe in the Hersheys’ philanthropy as regards the school and the development of the Current Beneficiaries, we can never be certain that the Hersheys’ philanthropy will not again be taken over by Managers who are not in alignment with the Hersheys’ intent. 

 

(b)               Absence of an Authoritative Statement of the Hersheys’ Intent.

In the absence of an authoritative, well researched statement of the Hersheys’ intent, how can any individual Manager be certain that he or she is discharging their fiduciary duty properly? Moreover, the lack of an accurate, well articulated and preserved Managers’ authored description of the Hersheys’ intent for use in educating the residents of Hershey and those who are members of the School Family has led to the spread of half-truths and a proliferation of multiple alternatives to serve the interests of individuals or constituent groups.

 

(c)               The Managers Should Adopt a Strategic Plan that is Well Informed and Which Clearly Manifests Their Pursuit of the Hersheys’ Intent.

The Managers should adopt a strategic plan that is well informed by the authoritative statement of the Hersheys’ intent and which clearly manifests their pursuit of the Hersheys’ intent. This is an important issue. Moreover, it not only needs to be comprehensive, it also needs to be clear to all concerned that it is driven by the Hersheys’ intent.

 

5.                  Resolving the Unresolved Issues

There is more that I have learned and that could be said. However, learning about (i) what the Hersheys intended and (ii) what occurred in contrast with what they intended achieves only so much by itself. The real challenge remains. Unless good answers are provided, those who were originally affected by the Hersheys’ philanthropy will continue to ask questions about what happened, why things are no longer the way they were and demand things from the Trust. If allowed to go on unaddressed, this will repeat generation after generation. This affects members of the Hershey Community, the various not-for-profit activities in Hershey that are no longer supported by the Trust, HERCO and Hershey Foods Corporation, those who are members of the School Family and others.

Having to address these from time to time, including through litigation (or other means of dispute resolution), is a wasting of Trust assets. Moreover, failure of the Managers to use Trust funds strictly in adherence to the Hersheys’ intent is also a wasting of Trust assets to the extent there is variance from their intent.

---

[1]   Refer to Milton S. Hershey – “His Deeds are His Monument, His Life is Our Inspiration”.

[2]  There were as many boys admitted to the school as there were enrolled at the Derry Township high school, roughly giving rise to a ratio of two boys for each high school girl in Derry Township.

[3]  Rod Pera was a “townie” whose family goes back three generations to the original construction of the Hershey Chocolate Factory in 1903. He was also the Managing Partner of the law firm that was the primary provider of legal services to the Hershey Interests.

[4]   For example, there was competition for a larger share of business profits, a closed labor shop and self-determination as a community, as well as the establishment of policies forcing graduates of Milton Hershey School to return only to visit but not work or live in Hershey, PA – the home promised to them by the Hersheys – thereby eliminating them as competitors for jobs, housing, etc.

[5]  Some examples include (i) allowing student internships through Hershey Junior College to be addressed by the high school from which a student came instead of through the Hershey Interests as originally planned, and (ii) incorporating The Hershey Industrial School Alumni Association pursuant to a model that differed from that which was originally intended by the Hersheys.

[6]   For details, review and compare Paragraphs 3, 4 and 5 of the 1933 Petition with Paragraphs 3 through 6 of the 1951 Petition.

[7]  The 1963 Decree resulted in $50,000,000 of dependent children’s funds being distributed from the Trust to Pennsylvania State University to build a medical center in Hershey, PA.

[8]   Note: This is not a qualitative statement regarding the merits of this change.  Rather, it is an observation that even the Managers, Trustee and Trust are subject to proper process of law.

[9]   Note: This is not a qualitative statement regarding the merits of this change.  Rather, it is an observation that even the Managers, Trustee and Trust are subject to proper process of law.

[10]   Note: This is not a qualitative statement regarding the merits of this change.  Rather, it is an observation that even the Managers, Trustee and Trust are subject to proper process of law.

[11]   Note: This is not a qualitative statement regarding the merits of this change.  Rather, it is an observation that even the Managers, Trustee and Trust are subject to proper process of law.

[12]   Note: This is not a qualitative statement regarding the merits of this change.  Rather, it is an observation that even the Managers, Trustee and Trust are subject to proper process of law.

[13]   Note: This is not a qualitative statement regarding the merits of this change.  Rather, it is an observation that even the Managers, Trustee and Trust are subject to proper process of law.

[14]   Even the Managers, Trustee and Trust are subject to proper process of law. To use Trust funds for purposes not yet approved by the Orphans Court is a breach of fiduciary duty and a violation of the Deed of Trust and Pennsylvania law.

 

INDEX OF TERMS

1 1905 Formation of HTC 1908 Incorporation of Hershey Chocolate Company 1909 Milton Hershey Will 1910 Formation of the Trust 1918 Contribution of Hershey Chocolate Company Stock 1918 Conveyance of Non Chocolate Assets to Hershey Chocolate Company 1918 Endorsement of the 1918 Transferred Hershey Chocolate Company Stock Certificate 1918 Hershey Chocolate Company Stock Certificate 1918 Letter to Hershey Chocolate Company 1918 Transferred Shares of Hershey Chocolate Company Common Capital Stock Shares 1919 Decree 1919 Deed Modification 1919 Incorporation of the Managers 1923 Literary Digest 1927 Formation of Hershey Chocolate Corporation 1927 Formation of Hershey Estates 1929 Stock Market Crash 1932 Snavely 1933 Decree 1933 Deed Modifications 1933 M.S. Hershey Declaration and Joinder 1933 Paul Reed Memo 1933 Petition 1935 Description of HIS 1935 HJC Trust 1935 Living Trust of Milton Hershey 1935 Map of HIS Units 1939 Murrie 1944 Milton Hershey Will 1945 Residual Derry Township School District Trust 1946 Houseparent Handbook 1947 Alumni Association Incorporation Decree 1947 Alumni Association Petition for Incorporation 1948 Hershey 1950 Gumpher 1950 Hershey 1950 Houseparent Handbook 1950 Wallace 1951 Decree 1951 Deed Modification 1951 Deed of Trust 1951 Petition 1957 Snavely 1959 Anniversary Lectures 1959 Home Division Handbook 1960 Rudisill 1962 Rudisill 1963 Decree 1963 Education Division Handbook 1963 Hershey Chocolate 1963 Petition 1964 Nurick Letter to BOM 1968 Decree 1968 Nurick Opinion re Girard 1968 OAG Opinion re Girard 1968 Petition 1968 Senior Division Guidebook 1969 Hammond 1970 Decree 1970 Deed Modifications 1970 Deed of Trust 1970 Petition 1970 Petitioners 1971 Hostetter            1973 Klotz 1976 Declaration of Fellowship 1976 Decree 1976 Deed Modifications 1976 Deed of Trust 1976 Petition 1983 Castner 1984 Alumni Association Articles of Amendment 1988 MHS Market Plan 1990 Hershey 1990-1991 Board of Managers 1991 Trust Agreement 1992 Bryce Jordan Study 1992 Hershey Heritage Re John Snyder 1996 Hershey Chronology 1997 Relationship Memo 1998 Deed Modification 1999 – 2002 Alumni Association Legal Counsel 1999 Adjudication 1999 Amicus Brief 1999 Cy Pres Petition 2 2001 MHS Chronology 2002 Central Pa Magazine 2002 OAG Dialogues 2002 Stark Part I 2003 Alumni Association Petition 2003 Decrees 2003 Hearing Transcript 2003 MHS Alumni Directory 2003 Opinion 2004 MHS Chronology 21st Century Initiative            22nd Trust Accounting 23rd Trust Accounting A Alumni Alumni Association Alumni Association Board Alumni Association History Alumni Association Member Alumni Scholar Programs America’s Six Depressions Arthur Whiteman Attorney General August 22, 2000 MHSAA Memo August 3, 2000 MHSAA Memo B Basic Benefits Basic Capital for Success Beneficiaries Bias, Flaw, & Avoidance Board of Managers Business C Character Education CHILD Christianity Defined Community Constitution Contingent Beneficiary Copenhaver Copenhavers Current Beneficiary

D Deed of Trust  Dependent Direct Education Discretion Dr. Hershey Dr. Rudisill E Education Education Completion Date F Financial Need Former Commendable Students Former Good Students Former Students G George Copenhaver Great Depression Gumpher H Hammond HERCO Hershey Hershey Chocolate Company Hershey Chocolate Corporation Hershey Corporation Hershey Estates Hershey Foods Hershey High Hershey Industrial School Hershey Interests Hershey Junior College Hershey Trust Company Hersheys Hersheys’ Children’s Home Hersheys’ Children’s Home Campus Hersheys’ Children’s Home Development Plan HFC HIS HJC Home Homestead Hotel Hershey HTC HTC Board of Directors I Indenture Indenturing Indirect Education J J.O. Hershey John O. Hershey Joseph Gumpher Joseph Richard Snavel Joseph Snavely K K&L Report M M.S. Hershey Foundation Managers Medical Center Memorandum of Understanding MHS Milton Hershey School Milton Hershey’s 1944 Final Will Milton Hershey’s Alumni Association Milton Hershey’s Deed of Trust Milton Hershey’s First Trust Milton Hershey’s November 14, 1909 Will Minimum Education MS N Non-Resident Beneficiary Non-Resident Employee Normal O OAG Original Alumni Association Member Original Deed of Trust Orphan            Orphan Benefits Orphan Capital for Success Orphan Term Orphan Termination Event Orphans’ Court P P.N. Hershey Proposed Greenway Easement Proposed Third Restated Deed of Trust R Requirements for Admission Resident Beneficiary Resident Employee Resident Non-Employees Richard A. Rudisill Rudisill S Scholar Scholar Additional Education            Scholar Benefits Scholar Capital for Success Scholar Core Education Scholar Mandated Education Scholar Term Scholar Termination Event school School School Administration School Administrator School Archives School Family School Family Benefits Self-Reliance Education Snavely Social Need T The M.S. Hershey Foundation Trust Trust’s School Family Obligations Trustee            U USPS V Vocational, Agricultural and Academic Education W W. Allen Hammond Whiteman World War I World War II Y Year-round

 

 

GLOSSARY OF TERMS

Over more than a Century, many things have changed in America, particularly as relates to the Hersheys’ philanthropy – The Hershey Industrial School (which includes the “ideal community” or Hershey, Pennsylvania). That which the Hersheys created has no parallel. A consequence of the passage of so much time, precise definitions are needed that capture these changes and add specific meaning to the vocabulary used to explain the Hersheys philanthropy. 

The method of sighting references throughout this text is also somewhat different. This difference is deliberate. Most of the cite references specify the year in which the material was published or came into existence. This referencing is an important indicator. Generally speaking, sources published when Milton Hershey was alive, or soon after his death, tend to reflect a view more in line with that of Milton Hershey. When the date of publication follows Milton Hershey’s death in 1945, much of the writing reflects influences other than Milton Hershey’s.

 

“1905 Formation of HTC”- the 1905 formation of the Hershey Trust Company. 

“1908 Incorporation of Hershey Chocolate Company”- the incorporation of the Hershey Chocolate Company in 1908.

“1909 Milton Hershey Will”- that certain will of Milton Hershey dated November 14, 1909, together with the codicils thereto, that is, Milton Hershey’s November 14, 1909 Will.

“1910 Formation of the Trust”- the moment at which the Trust was first formed as a result of the execution of the Deed of Trust by the Hershey Trust Company on April 14, 1910 and the execution of the initial Managers of the Deed of Trust on April 14, 1910, which became binding on third parties upon the recording of the Deed of Trust in the public records on July 7, 1910.

“1918 Conveyance of Non Chocolate Assets to Hershey Chocolate Company”- that certain conveyance, effective January 1, 1918, pursuant to which Milton Hershey transferred to the Hershey Chocolate Company the Hershey Transit Company, Elizabethtown and Deodate Street Railway Company, Deodate and Hershey Street Railway Company, Hershey Electric Company, Hershey Water Company, Hershey Bell Telephone Company, Hershey Cuban Railway Company, Campania Agraria Cubana, Hershey Corporation, and the businesses operated as the planing mill, printery, laundry, stable, garage, and other miscellaneous businesses, which included: “Whereas, the Hershey Chocolate Company has acquired and is taking over by conveyance from M.S. Hershey certain lands, being the town of Hershey, Pa., and certain dairies, farms, and the equipment thereof, more particularly described in a schedule thereof prepared and to be annexed hereto, with the income thereof from January 1, 1918, [...] and also certain personal property consisting of shares of stock, [...] of the several companies and businesses hereinafter named, which have been and are being operated in connection with the Hershey Chocolate Company.”^[1] In a letter dated November 14, 1918, M.S. Hershey states that certain land (and related assets) had “for some years past belonged to the Hershey Industrial School, and has been operated, managed, and controlled solely by it, the legal title to the real estate being held by me in trust.”^[2]

“1918 Contribution of Hershey Chocolate Company Stock”- the November 13, 1918 gift by Milton S. Hershey of substantially all the stock he owned in the Hershey Chocolate Company to the Trust, which was then valued at $60,000,000,^[3] which occurred two days following World War I Armistice on November 11, 1918.

“1918 Endorsement of the 1918 Transferred Hershey Chocolate Company Stock Certificate”- that certain endorsement on the riverside of the 1918 Transferred Hershey Chocolate Company Stock Certificate, Number 7, which endorsement reads as follows:

For value Received I hereby sell, assign and transfer unto Hershey Trust Company, Trustee, in trust, for Hershey Industrial School, four thousand nine hundred and fifty eight shares of the Common Capital Stock represented by the within Certificate and do hereby irrevocably constitute and appoint _______________________________ Attorney to transfer the said stock on the Books of the within named Company with full power of substitution in the premises.

 

Dated November 13, 1918

Sealed and Delivered              /s/ M S Hershey [seal]

 in presence of  

/s/ A. M. Mowery

/s/ Wm. J. Harvey

“1918 Letter to Hershey Chocolate Company”- that certain letter dated November 14, 1918, in which M.S. Hershey states that certain land (and related assets) had “for some years past belonged to the Hershey Industrial School, and has been operated, managed, and controlled solely by it, the legal title to the real estate being held by me in trust.”  This letter has a handwritten note initialled by John Snyder which states, in reference to this letter, “Is preserved as a memorandum.”

“1918 Transferred Hershey Chocolate Company Stock Certificate”- that certain Stock Certificate Number 7 dated March 4, 1915 evidencing Four Thousand Nine Hundred and Sixty Eight (4,968) shares of the common capital stock of the Hershey Chocolate Company, incorporated under the laws of the State of Pennsylvania issued to M. S. Hershey as owner, signed by Ezra Hershey as Treasurer of Hershey Chocolate Company and William Murrie as President of Hershey Chocolate Company.

“1918 Transferred Shares of Hershey Chocolate Company Common Capital Stock Shares” - the four thousand nine hundred and fifty eight (4,958) shares of the Common Capital Stock of Hershey Chocolate Company transferred to the Trust pursuant to the 1918 Endorsement of the 1918 Transferred Hershey Chocolate Company Stock Certificate.

 “1919 Decree”- the decree entered by the Court of Common Pleas of Dauphin County, Pennsylvania which authorized the incorporation of the Managers as The Hershey Industrial School, a Pennsylvania nonprofit corporation, a corporation of the first class, which charter was recorded in the Office of the Recorder of Deeds in Dauphin County, Pennsylvania in Charter Book L, Page 282, which also gave rise to the Certificate of Incorporation of The Hershey Industrial School, approved by said Decree of Dauphin County Court of Common Pleas on 12/30/19, having been recorded at Dauphin County Recorder of Deeds Charter Book L, Page 282, etc.  (Docket entries other than No. 712, year of 1963.)

“1919 Deed Modification”- the incorporation of the Managers as The Hershey Industrial School, a Pennsylvania nonprofit corporation, a corporation of the first class, authorized by the Court of Common Pleas of Dauphin County, Pennsylvania, the charter for which is recorded in the Office of the Recorder of Deeds in Dauphin County, Pennsylvania in Charter Book L, Page 282.

“1919 Incorporation of the Managers”- the incorporation of the Managers as The Hershey Industrial School, a Pennsylvania nonprofit corporation, pursuant to Paragraph 28 of the Deed of Trust and the 1919 Decree.

“1923 Literary Digest”- “Chocolate Millions for Charity,” The Literary Digest. Vol. LXXIX No. 9, Dec. 1, 1923.

“1927 Formation of Hershey Chocolate Corporation”- the October 1927 formation and incorporation of Hershey Chocolate Corporation, a Delaware corporation, which was capitalized with all the “chocolate assets” previously owned by Hershey Chocolate Company.^[4]

“1927 Formation of Hershey Estates”- the October 1927 formation and incorporation of Hershey Estates, a Pennsylvania corporation, which was capitalized with all of the non-chocolate assets or “town assets” previously owned by Hershey Chocolate Company.^[5]

“1929 Stock Market Crash”- the event generally referred to today as “Black Thursday,” which marks the Stock Market crash on October 24, 1929. ^[6]

“1932 Snavely”- Snavely, J. R. A Chat with Mr. Hershey. 1932.

“1933 Decree”- the Decree dated October 30, 1933 issued in connection with the 1933 Petition by the Court of Common Pleas of Dauphin County, Pennsylvania, in Equity.

“1933 Deed Modifications”- revision of the Original Deed of Trust by the Court’s 1933 Decree which modified the Original Deed of Trust (1) to expand the class of orphans served by the school, as follows: (a) the maximum age range for admission of poor, healthy, white male orphans was expanded from between four and eight years of age to between four and fourteen years of age; and (b) otherwise qualified boys whose mothers were deceased but whose fathers were still living were made eligible for admission and (2) to add this provision, “No person employed by the school, in any capacity, in connection with which any compensation or expenses are directly or indirectly paid, shall at the same time serve as a member of the Managers of The Hershey Industrial School,” as Paragraph 29 of the Deed of Trust; Milton S. Hershey joined in said 1933 Petition.^[7]

“1933 M.S. Hershey Declaration and Joinder”- the Declaration of Intent and Joinder of Milton S. Hershey, filed by Milton S. Hershey in connection with the 1933 Petition, dated October 27, 1933.

“1933 Paul Reed Memo”- the memorandum dated November 10, 1933, from Mr. Paul Reed to Mr. W. v.Tresckow, Assistant Vice President regarding Suggestions to Mr. Hershey and Associates.

"1933 Petition”- the Petition for Modification of Trust, dated October 27, 1933, filed in the Court of Common Pleas of Dauphin County, Pennsylvania, in Equity, Equity Docket, Number 1096, filed by The Hershey Industrial School, a nonprofit corporation as the petitioner, by leave of the Attorney General.^[8]

“1935 Description of HIS”- A Brief Description of The Hershey Industrial School, 1935 Edition, 1935.

“1935 HJC Trust” or “The M.S. Hershey Foundation” or “M.S. Hershey Foundation”- The M.S. Hershey Foundation, created pursuant to that certain Agreement of Trust, between Milton S. Hershey, as Donor, and Hershey Trust Company, as Trustee, and M.S. Hershey, Ezra F. Hershey, William F.R. Murrie, P.A. Staples, S.C. Stecher, P.N. Hershey, and William H. Earnest, as Managers, dated December 5, 1935, for the purpose of creating and endowing in perpetuity a Foundation for educational purposes to be known as “The M.S. Hershey Foundation.”

“1935 Living Trust of Milton Hershey”- the Declaration of Trust, dated August 22, 1935, regarding the transfer, assignment and delivery of 1250 shares of the capital stock of the Hershey Trust Company from Milton S. Hershey to Milton S. Hershey, as trustee, in trust for the benefit of the Trust, pursuant to which Milton Hershey gave the economic value of such shares to the Trust but retained all voting rights.

“1935 Map of HIS Units”-the map titled “Location of Hershey Industrial School Units,” dated March 1935 and numbered 1354.

“1939 Murrie”- Murrie, Richard Wallace^[9] The Story Behind a Hershey Bar, the History of the foundation and subsequent growth of the Hershey Chocolate Corporation and the simultaneous development of the model industrial community of Hershey, Pennsylvania. Senior Thesis, Department of History, Princeton University, 1939

“1944 Milton Hershey Will”- the will dated September 29, 1944 of Milton S. Hershey, that is, Milton Hershey’s 1944 Final Will.

“1945 Residual Derry Township School District Trust”- that certain trust created pursuant to the 1944 Milton Hershey Will, pursuant to which Milton Hershey bequeathed all of the rest and residue of his estate “to Hershey Trust Company, of Hershey, Pennsylvania, in trust, nevertheless, to hold, invest and reinvest in such securities as may seem best in the judgment of the Directors of said Trust Company, and order and direct my said Trustee to pay the income thereof in semi-annual installments to the School District of Derry Township, Dauphin County, Pennsylvania, for the use of said School District, particularly for the purpose of assisting such Township to relieve the tax burden for the upkeep and maintenance of the public school in said District.”

“1946 Houseparent Handbook”- Official Handbook for the House-Parents of The Hershey Industrial School, Hershey, Pa. May, 1946. The Handbook was first developed in 1945 and was adopted by the Administrative Staff of the School in 1946.

“1947 Alumni Association Petition for Incorporation”- the Application for a Charter for a Domestic Nonprofit Corporation, for The Hershey Industrial School Alumni Association, dated January 30, 1947, in the Court of Common Pleas of Dauphin County, Pennsylvania, No. 213, January Term, 1947, filed in the Office of the Prothonotary of Dauphin County on February 14, 1947.

“1947 Alumni Association Incorporation Decree”- the decree by the Court of Common Pleas of Dauphin County, on March 17, 1947, which decree provided that upon the recording of the Articles of Incorporation and this Order, that the Alumni Association would be incorporated and the Alumni Association was incorporated on March 17, 1947.^[10] 

“1948 Hershey”- Hershey, John O. The Development of an In-Service Training Program for House-Parents of the Hershey Industrial School.  University of Pennsylvania, 1948. This report was submitted in partial fulfillment of the requirements for the degree of Doctor of Education.           

“1950 Gumpher” - Gumpher, Joseph S. Institutional Trust Service. New Burnswick: Rutgers University, 1950. This document was submitted in partial fulfillment of the requirements for The Graduate School of Banking conducted by the American Bankers Association at Rutgers University.

“1950 Hershey”- Hershey, John O. The Alumni of The Hershey Industrial School, Information Concerning Them and What They Say About Their Alma Mater. Hershey, PA: The Hershey Industrial School, 1950.

“1950 Houseparent Handbook”- Bobb, James E., John J. Daniel, John O. Hershey eds. The Houseparent Handbook, a Guide for the Houseparents of The Hershey Industrial School. Hershey, Pennsylvania: The Hershey Industrial School, 1950. The Handbook was first adopted in May 1946; was then revised in Jan. 1947 and again in Jan. 1948; it was first printed in this 1950 edition. The printing was done by the students of The Hershey Industrial School.  At that time, John O. Hershey was Director, Student Personnel Department, and he edited this Guide in collaboration with James E. Bobb, Superintendent Farm-Home Division, and John J. Daniel, Superintendent Junior Division.

“1950 Wallace”- Wallace, Paul A. W. THE CHOCOLATE KING, The Story of M.S. Hershey.  Unpublished essay, circa 1950s. This was commissioned by the Milton Hershey School.

 “1951 Decree”- the decree entered in Dauphin County Orphans' Court Docket No. 824, on December 17, 1951, which also gave rise to an Amendment to the Articles of Incorporation of the Managers recorded in the Office of the Recorder of Deeds in and for the County of Dauphin in Charter Book "P", at page 658 and further amended on December 24, 1951 in Charter Book "T" at page 273.

“1951 Deed Modification”- the change from use of the name “The Hershey Industrial School” to use of the name “Milton Hershey School,” authorized by the 1951 Decree.^[11]

“1951 Deed of Trust”- Milton Hershey’s Deed of Trust as modified by the 1951 Decree.

“1951 Petition”- the Petition for Modification of Trust, In Re Petition of The Hershey Industrial School for Modification of Trust, No. 824 – 1951, in the Orphans’ Court of Dauphin County, Pennsylvania, dated December 12, 1951, filed by The Hershey Industrial School, a Pennsylvania nonprofit corporation, by leave of the Attorney General.

“1957 Snavely”- Snavely, Joseph R. An Intimate Story of Milton S. Hershey. Harrisburg: J. Horace McFarland Company, 1957.

“1959 Anniversary Lectures”- Faculty and Students of the Printing Curriculum. The Anniversary Lecture Series. Hershey: Milton Hershey School, 1959-1960. This series was sponsored “as one of the ways of celebrating the fiftieth anniversary school year (1959-60) of this professional institution founded and endowed by the late Milton S. Hershey in November 1909.”^[12]

“1959 Home Division Handbook”- Gibble, Alfred T., John O. Hershey, Richard A. Rudisill. eds. The Home Division Handbook, a Guide for the Houseparents of Milton Hershey School.  Hershey, PA: Milton Hershey School, 1959.^[13]

“1960 Rudisill”- Rudisill, Richard A. A Survey of Alumni of Milton Hershey School Since 1949, A Paper Presented in Partial Fulfillment of the Requirements in Education 800. University of Pennsylvania, 1960.

“1962 Rudisill”- Rudisill, Richard A. Milton Hershey School, The First Fifty Years. Diss. University of Pennsylvania, 1962. Pn362.7, R835. This document was submitted in partial fulfillment of the requirements for the degree of Doctor of Education, Studies in Education No. 130. It was approved Nov. 1962 (Maria Hosmer Penniman Library of Education).^[14]

 “1963 Decree”- the Decree entered in Dauphin County Orphans' Court Docket No. 712 of 1963 on August 23, 1963, by Judge Lee F. Swope, entered the same day as the day on which the 1963 Petition was filed with said Court.

“1963 Education Division Handbook”- the Educational Division Handbook, A Guide for the Teachers of Milton Hershey School, Revised 1963-64.

“1963 Hershey Chocolate"- Hershey Chocolate Corporation. The Story of Hershey the Chocolate Town. Hershey, Pennsylvania: 1963.

“1963 Petition”- the cy pres petition filed in Dauphin County Orphans' Court Docket No. 712 of 1963 on August 23, 1963. 

“1964 Nurick Letter to BOM”- Nurick, Gilbert. Opinion Letter to the Board of Managers. 22 July 1964. McNees, Wallace & Nurick, Attorneys at Law.

“1968 Decree”- the Decree entered in Dauphin County Orphans' Court Docket No. 712 of 1963 on December 17, 1968 entered by Lee F. Swope, which 1968 Decree, among other things, authorized the transfer of ownership and control of The Milton S. Hershey Medical Center from The M.S. Hershey Foundation to The Pennsylvania State University.   The 1968 Petition was filed on December 17, 1968, the 1968 Degree was entered on December 17, 1968 and the 1968 Decree was recorded on December 17, 1968, 712 of 63, O.C. Book Vol. J-4, Page 238 / Clerk of Orphans Court, without notice or a hearing.

“1968 Nurick Opinion re Girard”- the May 13, 1968 Opinion of Gilbert Nurick, Counsel to the Board of Managers of Milton Hershey School, pursuant to which the racially restrictive admissions requirement was terminated.

“1968 OAG Opinion re Girard”- June 4, 1968 Opinion of William C. Sennett, Attorney General of Pennsylvania, pursuant to which racially restrictive admissions requirement was terminated.

“1968 Petition”- the Petition for Modification of the Decree of the Orphans’ Court of Dauphin County Dated August 23, 1963, filed in the Orphans’ Court of Dauphin County, Pennsylvania No. 712, 1963, as In Re: Petition of Hershey Trust Company, Trustee for The M.S. Hershey Foundation, for Modification of the Decree of the Orphans’ Court of Dauphin County, Pennsylvania, dated August 23, 1963, to Substitute The Pennsylvania State University as Trustee of The Milton S. Hershey Medical Center.^[15]

“1968 Senior Division Guidebook”- Senior Division Guidebook, the Milton Hershey School, 1968.

“1969 Hammond”- Hammond, W. Allen. A Man and His Boys, 60^th Anniversary 1909-1969. Manheim, PA: Stiegel Printing Company, 1969.

“1970 Decree”- the Decree of the Orphans’ Court Dauphin County, Pennsylvania, entered in Dauphin County Orphans' Court Docket No. 712 of 1963 on December 24, 1970, signed by Lee F. Swope.  The 1970 Petition was filed on December 24, 1970, the 1970 Degree was entered on December 24, 1970 and the 1970 Decree was recorded on December 24, 1970, 712 of 63, O. C. Book Vol. Q-4, Page 129/ Clerk of Orphans Court, without notice or a hearing.

“1970 Deed of Trust”- the 1951 Deed of Trust as modified by the 1970 Decree.

“1970 Deed Modifications”- the numerous changes to the Deed of Trust effected by the 1970 Decree, which includes (1) elimination of all references in the Deed of Trust that restricted admission to the school to “white” orphans; (2) authorizing the payment of reasonable expenses incurred by the Managers’ in the performance of their duties; (3) authorizing officers, counsel and consultants who were compensated employees of the school to also serve as Managers; (4) authorizing the examination of Trust investment securities to be performed by certified public accountants rather than the Managers; (5) authorizing the Managers to delegate investment decisions to an Investment Committee; (6) extension of the age of admission to sixteen years (that is, that the child not have reached his 16th birthday); (7) acknowledging the expansion of the school beyond land originally conveyed by the Original Deed of Trust; (8) elimination of the requirement in the Deed of Trust that “No orphans shall be admitted until” Indentured; (9) elimination of the requirement that proceeds from the sale of land be used solely to purchase additional land; (10) expressly authorizing students to remain at the school until they completed their secondary education, even if they remained past their eighteenth birthday; and (11) the incorporation of all prior modifications of the Original Deed of Trust into a Restated Deed of Trust.^[16]

“1970 Petition”- the cy pres petition, Petition for Modification of Trust, filed in Dauphin County Orphans' Court Docket No. 712 of 1963 on December 24, 1970.

“1970 Petitioners”- the petitioners under the 1970 Petition.

“1971 Hostetter”- Hostetter, Herman H. The Body, Mind and Soul of Milton Snavely Hershey, 1971. Hostetter was M.S.’s personal doctor.^[17]

“1973 Klotz”- Klotz, Richard Russell. The Rise and Demise of the Hershey Junior College, an Historical – Descriptive Study of the Hershey Junior College, Hershey, Pennsylvania, 1938-1965.  Manheim, PA: Stiegel Printing, Inc. 1973.

“1976 Declaration of Fellowship”- Milton Hershey School Alumni Association. The Unanimous Declaration of Fellowship – 1976. 24 Apr. 1976.

 “1976 Decree”- the Decree entered in Dauphin County Orphans' Court Docket No. 712 of 1963 on November 15, 1976, signed by Lee F. Swope." The 1976 Petition was filed on November 15, 1976, and the 1976 Degree was entered on November 15, 1976, without notice or a hearing.

“1976 Deed of Trust”- the 1970 Deed of Trust as modified by the 1976 Decree, which has been designated the “Second Restated Deed of Trust.”

“1976 Deed Modifications”- the numerous changes to the Deed of Trust effected by the 1976 Decree, which includes (1) elimination of all references to the restriction of admission to “males”; (2) elimination of the requirement that students be biological orphans, and allowing admission if a child was not receiving adequate parental care from one of his or her natural parents, even though both of the child’s natural parents were living; (3) correction of the spelling of Catherine S. Hershey’s first name; and (4) the incorporation of these 1976 modifications into a Second Restated Deed of Trust.^[18]

“1976 Petition”- the cy pres petition, Petition for Modification of Trust, filed in Dauphin County Orphans' Court Docket No. 712 of 1963 on November 15, 1976.

“1983 Castner”- Castner, Charles Schuyler. One of a Kind, Milton Snavely Hershey 1857-1945. Hershey, PA: The Kutztown Publishing Co. Inc., 1983.

“1984 Alumni Association Articles of Amendment”- the Articles of Amendment – Domestic Nonprofit Corporation of the Milton Hershey School Alumni Association filed on June 5, 1984 with the Secretary of the Commonwealth, Department of State, Commonwealth of Pennsylvania, in which it is stated that the Alumni Association was incorporated on March 17, 1947.

“1988 MHS Market Plan”- the “Market Plan for Milton Hershey School,” prepared by Rita H. Borden, Senior Marketing Consultant, Independent School Management, 1316 N. Union Street, Wilmington, Delaware 19806, dated November 11, 1988.

“1990 Hershey”- “Hershey Community Archives, Oral History Program, Dr. John O. Hershey.” 28 Aug. 1990. Hershey, PA: Hershey Community Archives.

“1990-1991 Board of Managers”- the Board of Managers who developed and approved the 21^st Century Initiative who knew that changes to the Deed of Trust and Orphans’ Court approval were necessary to the proper determination of whether the 21^st Century Initiative could be implemented and authorized and/or required the preparation of the Proposed Third Restated Deed of Trust.

“1991 Trust Agreement”- the Trust Agreement, dated January 1, 1991, by and between Milton Hershey School, as Settlor, and the Hershey Trust Company, as Trustee.           

“1992 Bryce Jordan Study”- Jordan, Bryce, John T. Whatley. The Milton S. Hershey School: A Brief Study of the Institution with Conclusions and Recommendations. 20 July 1992. Jordan was the President Emeritus of Pennsylvania State University and Whatley was President of Whatley Associates.

“1992 Hershey Heritage Re John Snyder”- Reese, Robert M. Rotary Club of Hershey, Our Hershey Heritage, November – December 1992, Our Hershey Heritage, December 7, 1992, The Lawyer, Judge John Snyder. 7 Dec. 1992.  Hershey Foods Corporation.

“1996 Hershey Chronology”- Hershey Community Archives. The Hershey Chronology, 1724 to Present. Hershey, PA. 25 Apr1996.

“1997 Relationship Memo”- the July 11, 1997 Memo from Mavis Kelley and Robert Stets, Esq. to Ralph Carfagno and Graham McIntyre regarding Range of Relationship.

“1998 Deed Modification”- The Honorable Judge Warren G. Morgan’s ruling in the Orphans’ Court’s confirmation of the Twenty-Second and Partial Accounting dated August 12, 1998 that “[…] this Court confirming that it is appropriate for the School, from time to time, to provide minor, incidental direct support to, and/or permit the minor, incidental use of assets/facilities of the School by, certain third parties and members of the public, without charge (or for nominal charge), where such support and/or use has been determined by the School, in its discretion, to further the charitable purpose of the School, as described in the Petition for Adjudication.”^[19]

“1999 Adjudication”- the Adjudication dated December 7, 1999 entered in Dauphin County Orphans' Court Docket No. 712 of 1963 and signed by the Honorable Judge Warren G. Morgan.^[20]

“1999 – 2002 Alumni Association Legal Counsel”- Mayer, Brown & Platt, which by agreement became Mayer, Brown, Rowe & Maw in February 2002, ^[21] which served as legal counsel to the Alumni Association from the beginning of 1999 through the end of 2002 on a pro bono basis.

“1999 Amicus Brief”- the Brief of Milton Hershey School Alumni Association, authored by Mayer, Brown & Platt as counsel for the Alumni Association, filed by John F. Halbleib, Esq., as a partner in Mayer, Brown & Platt, John F. Mardula, Esq., as Vice President and Counsel of the Alumni Association and Michael J. Wilson, Esq., as local pro bono counsel, in the Orphans Court in opposition to the 1999 Cy Pres Petition (that is, opposing CHILD and the Greenway Easement), on behalf of the Alumni Association, dated July 23, 1999.

“1999 Cy Pres Petition”- the Petition for Cy Pres Award of Portion of Accumulated Income and Authorization for the Execution and Delivery of Certain Easements Cy Pres, signed January 19, 1999 and filed in Dauphin County Orphans' Court Docket No. 712 of 1963 in February 1999, by the Milton Hershey School, a Pennsylvania nonprofit corporation, as the Managers, and the Hershey Trust Company, as Trustee, of the Milton Hershey School Trust.

“2001 MHS Chronology”- Brechbill, Joseph A. A Chronology of Milton Hershey School. Historical Records, May 1997. Rev. 5 Feb.  2001.

“2002 Central Pa Magazine”- Rohland, Pamela. “What Would Milton Do?, Hershey: The Man, The Community and Change.” Central PA Magazine, Nov. 2002, Vol. 22 No. 5.

“2002 OAG Dialogues”- the dialogues which began in early calendar year 2002, among the Alumni Association, Board of Managers and OAG.

“2002 Stark Part I”- Stark, Craig. “Part I: The Legacy of Milton S. Hershey.” Harrisburg Magazine Nov. 2002, Vol. 8, No. 11.

“2003 Alumni Association Petition” - that certain petition, dated September 4, 2003, filed by the Milton Hershey School Alumni Association, a Pennsylvania nonprofit corporation, in the Court of Common Pleas, Orphans’ Court Division, Dauphin County, Pennsylvania, in equity proceeding Milton Hershey School and Hershey Trust Company, trustee of Milton Hershey School Trust, No. 712, Year of 1963.

“2003 Decrees” - those certain Orders, dated November 19, 2003, entered by the Orphans’ Court denying the Alumni Association standing and dismissing the 2003 Alumni Association Petition.

“2003 Hearing Transcript” - that certain Transcript of Proceedings, Preliminary Objections to Petition to Show Cause before the Honorable Warren G. Morgan, dated November 10, 2003, in connection with the 2003 Alumni Association Petition.  

“2003 MHS Alumni Directory” - Milton Hershey School, Alumni Directory, 2003, Bernard C. Harris Publishing Company, Inc., 2003, Purchase, New York.

“2003 Opinion” - that certain Opinion, dated November 19, 2003, of the Honorable Judge Warren G. Morgan, issued in support of the Orphans Court’s 2003 Decrees, denying standing to the Alumni Association and dismissing the 2003 Alumni Association Petition.

“2004 MHS Chronology”- Brechbill, Joseph A., D.ED, Curator and Dodge, Helen S., M.S., Director, Board and Visitor Relations, Chronology, Milton Hershey School, Historical Records of the Milton Hershey School, Rev. 20 April 2004.

 “21^st Century Initiative”- that certain Milton Hershey School: Its Mission, Purpose Goals and Strategies, Report and Recommendations, By A Joint Committee of Board and Staff Comprised of Rod J. Pera, Chairman, Joseph A. Brechbill, D. Rodney Chamberlain, William R. Fisher, Kenneth V. Hatt, Alan R. Malkoff, J. Bruce McKinney, Rodney E. McLaughlin, Robert L. Oesterling, John F. Rineman and D. Michael Weller, approved by the Board of Managers on February 8, 1990.

“22^nd Trust Accounting”- the Twenty-Second and Partial Account, Docket Entries at No. 712 of 1963, Accountings - Applicable Years: 08/01/93 to 07/31/96, Confirmed by Court on August 12, 1998.

“23^rd Trust Accounting”- the Twenty-Third and Partial Account, filed on October 6, 2000 in Docket Entries at No. 712 of 1963, Accountings - Applicable Years: 08/01/96  to 07/31/99, Date Confirmed by Court: Open.

“Alumni”- in the context of the Hersheys’ Children’s Home, all Former Students.

“Alumni Association”- from 1930 through March 16, 1947, Milton Hershey’s Alumni Association, and from March 17, 1947, the Milton Hershey School Alumni Association, a Pennsylvania nonprofit corporation.

 “Alumni Association Board” - the Board of Directors of the Alumni Association.

“Alumni Association History” - Milton Hershey School Alumni Association. The History of the Milton Hershey School Alumni Association. May 2002.

“Alumni Association Member” - a member or the Alumni Association in good standing.

“Alumni Scholar Programs” - the (i) residential, campus based, direct programs for Scholars, as well as (ii) other indirect programs for Scholars, which programs could extend well beyond a Scholar’s receipt of such Scholar’s Minimum Education, age 18 (and in fact well beyond age 21) and a high school education, which Alumni Scholar Programs the Hersheys mandated under the Deed of Trust that the Managers must, and gave the Managers broad discretion to, design and implement.

“America’s Six Depressions”^[22] - refers to the six depressions in American history that are thought to be the worst since detailed records of economic data started to be kept (around 1867), which are as follows: 1873 – 1879, 1893 – 1897, 1907 – 1908, 1920 – 1921, 1929 – 1933, and 1937 – 1938.

“Attorney General” - the Attorney General of the Commonwealth of Pennsylvania.

“August 3, 2000 MHSAA Memo” - the Memorandum, dated August 3, 2000, to William L. Lepley, President and CEO, Milton Hershey School, from John F. Mardula, President, Milton Hershey School Alumni Association, regarding Paragraph 5(a) of the Relationship Agreement, founders park, Campus Consolidation and Trust Land Generally.

“August 22, 2000 MHSAA Memo” - the Memorandum, dated August 22, 2000, from Milton Hershey School Alumni Association, to Andrew Cline and Richard Thornburgh of Kirkpatrick & Lockhart, Special Counsel, with copies to members of the MHS Board of Managers, Ad Hoc Oversight Committee (A. John Gabig, Esq., Lucy D. Hackney, Esq., Reverend John S. McDowell, Jr., and Ms. Wendy D. Puriefoy) and Mark Pacella and Linda Williams of the Office of the Attorney General, with enclosures, regarding the farm program and land.

“Basic Benefits” - the food, clothing, lodging, health services, physical training, exercise and recreation as contemplated by the first sentence of Paragraph 17 of Milton Hershey’s Deed of Trust,^[23] as well as a Minimum Education and School Family Benefits.

“Basic Capital for Success” - the Trust’s investment of Basic Benefits in Current Beneficiaries.

“Beneficiaries” - all Contingent Beneficiaries and all Current Beneficiaries.

“Bias, Flaw, & Avoidance” - Alumni Association. “Bias, Flaw, & Avoidance: A Response to the K&L Report.” 16 October 2000.

“Board of Managers” - term used in the Deed of Trust, meaning (1) from April 14, 1910, the date on which the original Managers accepted under the Deed of Trust, the individual Managers named in the Original Deed of Trust and their respective successors, collectively as a fiduciary under the Deed of Trust, through December 29, 1919, who where from amongst their group to elect officers of the Managers following a corporate governance model,^[24] and (2) on and after December 30, 1919, the Board of Directors of the Milton Hershey School, a Pennsylvania nonprofit corporation, collectively, who where from amongst their group to elect officers of the Managers following a corporate governance model. 

“Business” - the “Industrial” component of The Hershey Industrial School. The Hershey Industrial School is comprised of three major components, each of which is reflected in the name “The Hershey Industrial School.”^[25] “Industrial” represents the various businesses, including the Hershey Chocolate Company which the Hersheys created. In 1918, Milton Hershey first transferred ownership and control of all other businesses to the Hershey Chocolate Company. Then, he transferred ownership and control of the Hershey Chocolate Company to the Trust. In 1927, all of the non-chocolate businesses (including most of the land then owned by the Hershey Chocolate Company (including the town of Hershey), which was transferred on November 12, 1927, but excluding the assets related to the Cuban operation) were transferred to Hershey Estates, which was wholly owned by the Trust. In 1927, the Hershey Corporation was created to hold all sugar interests in Cuba.  It was also owned by the Trust. The funding for these resources came primarily from the Hersheys, the Trust or businesses owned or controlled by the Trust. Throughout, this component of The Hershey Industrial School is referred to as “Business.”

“Character Education” - the moral and religious training, training to speak the truth at all times, and training in the habits of economy and industry contemplated by Paragraph 18 of Milton Hershey’s Deed of Trust.^[26]

“CHILD” - the Catherine Hershey Institute for Learning and Development as proposed in the 1999 Cy Pres Petition.

“Christianity Defined” - Reformed Mennonite Church. Christianity Defined. Lancaster, Pennsylvania: Rudisill & Company, Incorporated, 1958.

“Community” - the “Hershey” component of The Hershey Industrial School. The Hershey Industrial School is comprised of three major components, each of which is reflected in the name “The Hershey Industrial School.”^[27] “Hershey” represents the community of Hershey, Pennsylvania, which the Hersheys founded. Hershey includes Derry Township and certain surrounding land. In 1918, Milton S. Hershey conveyed Hershey to the Hershey Chocolate Company, and then transferred ownership and control of the Hershey Chocolate Company to the Trust. On November 12, 1927, Hershey was transferred to Hershey Estates, which was wholly owned by the Trust. The funding for the improvements to Hershey (e.g., the Community Building and Theatre) came primarily from the Hersheys, the Trust, or businesses owned or controlled by the Trust. Throughout, this component of The Hershey Industrial School is referred to as “Community.”

“Community Building” - the Community Building and Theatre, housing the Hershey Community Theatre and the Community Center, which was dedicated during the thirtieth anniversary celebration of the town, September 1 through 4, 1933. As early as 1915, Milton Hershey possessed architect's drawings for the construction of a community building, but the arrival of World War I overclouded any such construction venture. As Mr. Hershey tightened his belt, the architect's plans were put away and virtually forgotten. The Hershey Community Building and Theatre, originally planned for construction in 1916, would not be constructed until 1929. The Community Building and Theatre were constructed during the Great Depression as part of Hershey's great building campaign. The Community Building and Theatre were built following the original 1916 plans drawn by C. Emlen Urban, a noted Lancaster, PA architect, with construction under the supervision of D. Paul Witmer. When completed, the building solidly stood in the center of town, spanning the block between Chocolate and Caracas Avenues, and bordered by Cocoa Avenue. It occupied sites once owned by Milton Hershey's mother and the McKinley School.^[28] The cost was $3,000,000 and it was funded by the Trust, from profits derived from Hershey Corporation.

“Constitution” - the Constitution of Milton Hershey’s Alumni Association.

“Contingent Beneficiary” - each natural person who is able to satisfy the Requirements for Admission, but who is not at the time a Current Beneficiary.

“Copenhaver” or “George Copenhaver” - George Copenhaver, first employed by Milton Hershey to be the Superintendent of Farms. When the School was founded he was named the School’s first Superintendent. He is buried in the Hershey Cemetery. For more information regarding George Copenhaver, refer to Section 2.10 1938 Death of George Copenhaver.

“Copenhavers” - George Copenhaver and his wife, Prudence. Even though The Homestead was no longer suitable for the number of students enrolled in the School, it continued to serve as the central office and residence of key administrators: the first superintendent Copenhaver and his wife resided there until their deaths. (George - 1938; Prudence - 1949). In the words of Milton Hershey “Much of the credit for the success of the lives of the students of the school was due and is due to the splendid work of Mr. and Mrs. Copenhaver. They have been real parents to all the boys who have come under their loving and thoughtful care. Mr. Copenhaver did a fine work in all the years he devoted to these young men, and his influence for good will continue in the many years ahead of the students whose lives he touched.”^[29] 

“Current Beneficiary” - each natural person who has satisfied the Requirements for Admission, has been admitted to the School and continues to receive, or continues to be entitled to receive, benefits from the Trust because such person (i) has not been discharged, (ii) has been discharged but continues to receive, or is entitled to receive, benefits from the Trust because such person remains a Scholar whose Scholar Education Completion Date has not occurred, or (iii) is a Former Student receiving School Family Benefits.

“Deed of Trust” - the Original Deed of Trust, as revised through authority of the court and now evidenced by the 1976 Second Restated Deed of Trust and as further described in Appendix VII: Deed of Trust – As of Date of Publication in 2005; Restatement of the Deed of Trust recorded in the Office of the Recorder of Deeds in Chapter Book “L”, Vol. 2, Pages 459, 463, and 464-482.

“Dependent” - a child’s status that has resulted from extreme financial need and social need, to a degree where the child is in need of substantially year-round residential care by the Hersheys’ Children’s Home such as that which was intended by the Hersheys, as well as the material goods, services, development and education provided by the Trust, where “financial need” means a degree of dependency which demonstrates a household whose total income is such that the child’s healthy development is severely impeded, where the basic necessities of life are not consistently available, and where poverty is of such a degree that the impact on the child’s well-being is unquestionable, and “social need” means a degree of dependency which demonstrates a complete lacking of any parental care whatsoever from at least one parent, and a lacking of adequate care from such child’s other parent, guardian or other authority.

“Direct Education” - that education which is provided directly by the School.^[30]

“Discretion” - the authority and responsibility delegated by the Hersheys under the Deed of Trust and to be exercised by the Trustee or the Managers responsibility to exercise judgment, which includes (without limitation) that which the Hersheys mandated the Managers must, and gave the Managers broad discretion to, design and implement both (i) residential, campus based, direct programs for scholars, as well as (ii) other indirect programs for scholars, which programs could extend well beyond 18 (and in fact well beyond age 21) and a high school education.^[31]

“Education” - the “School” component of The Hershey Industrial School.  The Hershey Industrial School is comprised of three major components, each of which is reflected in the name “The Hershey Industrial School.”^[32] School represents the education system which the Hersheys created within Derry Township, including those that were public and those that were not. The funding for these resources came primarily from the Hersheys and the Trust, as well as the community of Hershey primarily through taxes. Throughout, this component of The Hershey Industrial School is referred to as “Education.”

“Education Completion Date” - (a) in the case of each Orphan, the earlier of (i) the first date upon which such person (A) from November 15, 1909 through December 23, 1970, reaches 18 years of age and (B) on and after December 24, 1970, completes the full course of secondary education being offered by the School, and (ii) the date on which such person suffers an Orphan Termination Event, and (b) in the case of each Scholar, the earlier of (i) the first date upon which such Scholar has received his or her Scholar Capital for Success and (ii) the date on which such person suffers a Scholar Termination Event.

“Former Commendable Students” - all former students who left the school with a “commendable record.”

“Former Good Students” - all former students who left the school with a “good record,” which would include Former Commendable Students.

“Former Students” - all former students of the school, which would include Former Good Students and Former Commendable Students.

“Great Depression” - the economic period generally referred to as the “Great Depression”^[33] which began with the 1929 Stock Market Crash and ended with the United States of America’s entry into World War II in December 1941, and which is not a single depression but rather two economic depressions (the first began in 1929 and continued to 1933 and the second began in May 1937 and continued to 1938) between which there was an incomplete economic recovery.  This period was marked by widespread unemployment.^[34]

“Gumpher” or “Joseph Gumpher” - an alumnus of HIS, Class of 1936, and President of Milton Hershey’s Alumni Association from 1938 through 1939 and its Past President from 1940 through 1941, who in 1959 became the second Original Alumni Association Member to become a Manager. 

“Hammond” or “W. Allen Hammond” - Principal of Milton Hershey School, 1934 – 1959 and author of A Man and His Boys, 60^th Anniversary 1909-1969.

 “HERCO” - Hershey Estates, a Pennsylvania corporation formed pursuant to the 1927 Formation of Hershey Estates, which changed its name to “HERCO, Inc.” in 1976, and then changed its name to “Hershey Entertainment & Resort Company” in 1980. HERCO is used more commonly after 1976.

“Hershey” - the unincorporated community that became known as “Hershey” in 1906 to satisfy the USPS’s requirement that the new Post Office have a name, and which remains unincorporated to this day. “Hershey” represents the community of Hershey, Pennsylvania, which the Hersheys founded. Hershey includes Derry Township and certain surrounding land. In 1918, Milton S. Hershey conveyed Hershey to the Hershey Chocolate Company, and then transferred ownership and control of the Hershey Chocolate Company to the Trust. On November 12, 1927, Hershey was transferred to Hershey Estates, which was wholly owned by the Trust. The funding for most of the improvements to Hershey (e.g., the Community Building and Theatre) came primarily from the Hersheys, the Trust or businesses owned or controlled by the Trust.

“Hershey Chocolate Company” - (1) from its initial formation as an unincorporated business, through its first production of chocolate on January 1, 1894 as a subsidiary of the Lancaster Caramel Company and until the 1908 Incorporation of Hershey Chocolate Company, the unincorporated Hershey Chocolate Company, and (2) upon and following the 1908 Incorporation of Hershey Chocolate Company and until the 1927 Formation of Hershey Chocolate Corporation, the incorporated Hershey Chocolate Company. 

“Hershey Chocolate Corporation” - the Hershey Chocolate Corporation, a Delaware corporation, which resulted from the 1927 Formation of Hershey Chocolate Corporation.

“Hershey Corporation”^[35] - created in 1927 to hold all sugar interests in Cuba.  It was owned by the Trust. 

“Hershey Estates” - Hershey Estates, a Pennsylvania corporation formed pursuant to the 1927 Formation of Hershey Estates, which changed its name to “HERCO, Inc.” in 1976, and then changed its name to “Hershey Entertainment & Resort Company” in 1980.

“Hershey Foods” or “HFC” - Hershey Foods Corporation.

“Hershey High” - the various school (vocational and otherwise) which constituted the high school program in Derry Township School District, Derry Township, Dauphin County, Pennsylvania.^[36]

“Hershey Industrial School” or “HIS” - the School from November 15, 1909 to December 16, 1951, which became known as “Milton Hershey School” on December 17, 1951.

“Hershey Interests” - the various businesses from time to time owned or controlled by Milton Hershey or the Trust, which includes, but is not limited to, the Hershey Improvement Company, Hershey Estates, Hershey Trust Company, the Hershey Bank, Hershey Chocolate Company, Hershey Corporation, Hershey Chocolate Corporation, the school, etc.

“Hershey Junior College” or “HJC” - the Hershey Junior College, established by The M.S. Hershey Foundation in 1938. In 1938, three years after The M.S. Hershey Foundation was established, the Hershey Junior College opened, offering tuition free higher education to all Derry Township residents. Housed in the Community Building, the Hershey Junior College maintained high academic standards and helped many Hershey residents receive a college education. Hershey Junior College closed in 1965.^[37]

“Hershey Trust Company” or “HTC” - the Hershey Trust Company, which was formed in 1905.

“Hersheys” - “Milton S. Hershey and Catherine S. Hershey, his wife, of Hershey, Derry Township, Dauphin County, Pennsylvania, parties of the first part” under the Deed of Trust. 

“Hersheys’ Children’s Home” - a children’s home of the type, nature and programs intended by the Hersheys under the Deed of Trust, giving full effect to the resources of the Trust. The Hersheys’ Children’s Home is the School and all of its components, which is a children’s home for the Current Beneficiaries, that is dependent, at-risk children, who are in need of substantially year round institutional care by a children’s home such as that intended by the Hersheys for the full development of each Current Beneficiary as a whole person according to such person’s unique abilities, interests and commitment.

“Hersheys’ Children’s Home Campus” - substantially all of Derry Township and the surrounding land that from time to time is acquired for School purposes and adjoins or is conveniently near School property as contemplated by the first recital and Paragraph 7 of the Deed of Trust, which includes the “ideal community” of Hershey which serves as the “home” of the Beneficiaries.

“Hersheys’ Children’s Home Development Plan” - the step-by-step development plan pursuant to which the Hersheys pursued a wise plan through which they built The Hershey Industrial School.^[38]  Their end was achieved, but the achievement was no small task.  To achieve their objectives, it was prudent for the Hersheys to pursue their philanthropy in the following sequence:

1. The philanthropy required a profit driven economic engine to fund it.  Thus, the Hersheys created, and verified the economic viability of, the Business component (e.g. Hershey Chocolate Company, which serves as the profit driven economic engine that funds the philanthropy), while at the same time providing employment and stability to the Community (which is the Home of each Current Beneficiary).
2. To build a permanent “ideal community,” they would need a large land area.  Inasmuch as Lancaster (the original site of operation of Lancaster Caramel Company and Hershey Chocolate Company) was somewhat already developed, Lancaster would not suffice.  Thus, the Hersheys had to locate a large area of land well suited to producing chocolate, serving as an “ideal community,” and operating the Hersheys’ Children’s Home.  They found Derry Township and the surrounding area rural and well suited to such other requirements.
3. To create an “ideal community,” the Hersheys would need to build and verify the long term viability of the Community, as well as the additional Businesses that operate the Community.  This Community must serve as the Home of the Current Beneficiaries, as well as those who play some role in delivering the benefits of the Trust to the Current Beneficiaries (whether, for example, as a teacher, houseparent, worker or community member).
4. Once the viability of the Hershey Chocolate Company and the Community was sufficiently validated by the Hersheys, the Hersheys then set about to establish, and improve, the Education system in Derry Township.  This system serves to educate the Current Beneficiaries, as well as those who are members of the Community.

Once the viability of these components had been sufficiently validated, the Hersheys then set about to make their “ideal community” permanent.  For this permanence, they chose the Trust.  The timing of when to make the overall structure, or portions thereof, permanent is driven by both the timing of when to bring the Beneficiaries into the development plan and the confidence that the overall structure has proven its effectiveness and viability in perpetuity.

When one considers the full scope and implications of The Hershey Industrial School, 32 years for designing the plan, determining the viability of each component, fully implementing such design, and making The Hershey Industrial School subject to a permanent structure makes sense.  This well thought out, step-by-step development plan is referred to as the Hersheys’ Children’s Home Development Plan.

“Home” - the School, with particular emphasis on the School’s function as a home in the lives of the Current Beneficiaries and other members of the School Family.^[39]

“Homestead” - Milton S. Hershey’s family homestead near the village of Derry Church, in what was formerly the northwest tier of Lancaster County, where Milton S. Hershey was born on September 13, 1857 one year and eight month following the marriage of Henry H. Hershey and Veronica “Fanny” B. Snavely.^[40]

“Hotel Hershey” - Hotel Hershey, Hershey, Pennsylvania. 

“HTC Board of Directors” - the board of directors of the Hershey Trust Company.

“Indenture” - the legal document entered into to evidence the relationship required for Indenturing.^[41]

“Indenturing” - the legal relationship formed between each child, the Managers and the child’s parent, guardian or other competent authority required by Paragraph 15 of Milton Hershey’s Deed of Trust^[42] and was evidenced by an Indenture, pursuant to which (1) the child’s parent, guardian or other competent authority releases and relinquishes to the Managers the “custody and control of” the child at all times such child is a minor under state law – such that (a) the child is “to dwell with and serve” the Managers and “to be under their exclusive custody and control;” (b) the child is to “faithfully, honestly, and obediently serve the said Managers and conform to all their rules and regulations with reference to residence, studies, work and duty, and all other rules and regulations established by the Managers, their executive officers, or others by them appointed;” and (c) “the intent of this release being to enable the Managers to enforce in relation to the said orphan every proper restraint, and to prevent relatives, friends, or others from interfering with or withdrawing the said orphan from the school;” and (2) the Managers as a fiduciary undertake, among other things therein provided, (a) to “teach and instruct, or cause to be taught or instructed, the said orphan as set forth in the deed founding and endowing the school, and will keep and maintain the said orphan during the period aforesaid;” (b) “in their discretion, before or after the arrival of the said orphan at the age of eighteen years, provide for his further education at some other school, college, or university;” and (c) this additional obligation “The home provided for the said orphan by the Managers is situated at Hershey, Dauphin County, Pennsylvania, and that will be his residence,” in each case at all times the orphan remains a minor which undertakings are also set forth in the Deed of Trust as a continuing obligation of the Trust so long as such orphan remains a Scholar, including those described in “(b)” and “(c)” above while the Scholar is an adult.

“Indirect Education” - such of the Scholar Mandated Education that is provided through other schools, colleges and universities.^[43]

“John O. Hershey” or “J.O. Hershey” or “Dr. Hershey” - John O. Hershey.  Dr. John O. Hershey served Milton Hershey School for over 42 years. He began his work at The Hershey Industrial School as a houseparent in 1939 at student home Bonniemead where he served for seven years. After this assignment, he served as a guidance counselor, Director of Enrollment, Superintendent, and finally President of Milton Hershey School, a Pennsylvania nonprofit corporation, from 1963 until his retirement in 1981. Prior to coming to Milton Hershey School, Dr. Hershey attended several colleges, including Taylor University where he received his Bachelor of Arts degree and the University of Pennsylvania where he received his Masters Degree and Doctorate of Education. In addition to these degrees, he holds three honorary degrees from Taylor University, Bricker College and Albright College.  He served as President of the Milton Hershey School, a Pennsylvania nonprofit corporation, from 1963 until his retirement in 1981, as well as its Vice-Chairman in 1974 and Chairman from 1974 to 1981.  He served The M.S. Hershey Foundation from 1963 to 1982, and as its Vice-Chairman in 1974 and its Chairman from 1974 through 1981.  He served the Hershey Trust Company from 1963 through 1981, and as its Assistant Vice President from 1963 through 1980.  He served HERCO from 1967 through 1986, and as its Vice President from 1968 through 1974.^[44]

“K&L Report” - the Independent Evaluation of Fiduciary Compliance, Findings and Conclusions of Special Counsel, dated September 1, 2000, by Kirkpatrick & Lockhart LLP, as special counsel to the Board of Managers of the Milton Hershey School and the Board of Directors of the Hershey Trust Company.

“Managers” - term used in the Deed of Trust, meaning (1) from April 14, 1910, the date on which the original Managers accepted under the Deed of Trust, the individual Managers named in the Original Deed of Trust as “parties of the third part” and their respective successors, through December 29, 1919, and (2) on and after December 30, 1919, the Milton Hershey School, a Pennsylvania nonprofit corporation, as successor in interest to the individual Managers as contemplated by and effected through the exercise of Paragraph 28 of the Deed of Trust and the 1919 Decree,^[45] which Joseph Gumpher refers to as the “corporate fiduciary” in contrast with the School which he refers to as the “charitable institution.” ^[46]

“Medical Center” - The Milton S. Hershey Medical Center.

“Memorandum of Understanding” - the Memorandum of Understanding, dated as of September 9, 1993, between the Commonwealth of Pennsylvania, through its Attorney General Earnest D. Preate, Jr., and the Board of Managers of the Milton Hershey School.^[47]

“Milton Hershey’s November 14, 1909 Will” - that certain will and testament dated November 14, 1909, executed by Milton Hershey, with codicils of Milton S. Hershey, which includes 1^st Codicil dated July 31, 1912, 2^nd Codicil dated July 31, 1913, 3^rd Codicil dated April 2, 1915, 4^th Codicil dated September 4, 1915, 5^th Codicil dated September 8, 1919, 6^th Codicil dated November 3, 1921, 7^th Codicil dated January 2, 1923, 8^th Codicil dated June 18, 1928, 9^th Codicil dated May 27, 1929, and 10^th Codicil dated  July 22, 1929.

 “Milton Hershey’s 1944 Final Will” - the certain will dated September 29, 1944, pursuant to which he revoked Milton Hershey’s November 14, 1909 Will, and went on to provide (1) a contribution of all shares of the capital stock of the Hershey Trust Company to the Trust, providing that the Directors of the Hershey Trust Company are to have the power to vote said stock at all meetings or elections of the shareholders of the Hershey Trust Company, (2) all of the rest and residue of his estate “to Hershey Trust Company, of Hershey, Pennsylvania, in trust, nevertheless, to hold, invest and reinvest in such securities as may seem best in the judgment of the Directors of said Trust Company, and order and direct my said Trustee to pay the income thereof in semi-annual installments to the School District of Derry Township, Dauphin County, Pennsylvania, for the use of said School District, particularly for the purpose of assisting such Township to relieve the tax burden for the upkeep and maintenance of the public school in said District,” with Ezra F. Hershey, William F. R. Murrie and William H. Earnest appointed as his Executors.

“Milton Hershey’s Alumni Association” - the unincorporated association designated “The Hershey Industrial School Alumni Association” created in 1930 for and at the direction of Milton Hershey by George Copenhaver pursuant to a certain Constitution which provided, among other things, (1) “This association is organized for the purpose of looking after the general welfare of those who were formerly students at The Hershey Industrial School and left there with a good record,” (2) “The membership shall consist of those who were formerly students at The Hershey Industrial School, left there with a commendable record and have been elected to membership by a majority of the members present at any meeting,” (3) “It shall be the duty of the Secretary to keep a list of the membership, to correspond with former students of the School, to endeavor to keep a close relationship between the Association and these former students, and to encourage members of the Association to assist each other in every reasonable means,” (4) “It shall be the duty of the Welfare Committee to assist the Secretary in looking after the general welfare of the members of the Association,” and (5) “it is the purpose of this Association to keep in touch with former students, to assist in procuring employment for such students, and to provide such other assistance as may from time to time be necessary.”

“Milton Hershey’s Deed of Trust” - the Original Deed of Trust as modified during Milton S. Hershey’s life time, first when on December 30, 1919 the Court of Common Pleas of Dauphin County, Pennsylvania authorized the incorporation of the Board of Managers as The Hershey Industrial School, a Pennsylvania nonprofit corporation, a corporation of the first class, the charter for which is recorded in the Office of the Recorder of Deeds in Dauphin County, Pennsylvania in Charter Book L, Page 282, and second, when on October 30, 1933 the Court approved a petition authorizing revision of the Original Deed of Trust and such Court’s 1933 Decree (1) modified the Original Deed of Trust to expand the class of children served by the school, as follows: (a) the maximum age range for admission of poor, healthy, white male orphans was expanded from between four and eight years of age to between four and fourteen years of age; and (b) otherwise qualified boys whose mothers were deceased but whose fathers were still living were made eligible for admission and (2) added this provision, “No person employed by the school, in any capacity, in connection with which any compensation or expenses are directly or indirectly paid, shall at the same time serve as a member of the Managers of The Hershey Industrial School,” as Paragraph 29 of the Deed of Trust; Milton S. Hershey joined in said 1933 Petition.

“Milton Hershey’s First Trust” - the first trust he formed through his ownership of land and related assets in trust as part of the Hersheys’ Children’s Home but not yet contributed to the Trust, as acknowledged in his 1918 Letter to Hershey Chocolate Company regarding his holding title to certain land in trust for The Hershey Industrial School.

“Milton Hershey School” or “MHS” - the School from and after December 17, 1951, which was formerly known as “The Hershey Industrial School” from November 9, 1909 through December 16, 1951.

“Minimum Education” - (i) from November 15, 1909 through December 23, 1970, the Vocational, Agricultural and Academic Education contemplated by Paragraph 16 of the Deed of Trust^[48] until such person reaches 18 years of age, and (ii) on and after December 24, 1970, the Vocational, Agricultural and Academic Education contemplated by Paragraph 16 of the Deed of Trust until such person receives a full course of secondary education, in each case designed to fit such person for the trades such person is to learn, and a useful occupation in life.

“M.S.” - Milton S. Hershey. Many individuals called Milton S. Hershey “MS” during his life time and for a long time thereafter. In particular, the students in The Hershey Industrial School referred to Milton S. Hershey, and remember him today, as “MS.”

 “Non-Resident Employee” - any officer, director or employee of any Hershey Interest located within the Hersheys’ Children’s Home Campus or otherwise serving the Hersheys’ Children’s Home and not residing on the Hersheys’ Children’s Home Campus.

“Non-Resident Beneficiary” - a Current Beneficiary that is not a Resident Beneficiary.

“Normal” - with respect to the Requirements for Admission means “normal under the circumstances” and shall allow for behavioral, emotional, and educational disruptions ordinarily associated with dependency and likely of elimination or adequate amelioration once provided the substantially year-round residential care and material goods, services, development and education provided by the Trust.

“OAG” - the Office of the Attorney General of the Commonwealth of Pennsylvania.

“Original Alumni Association Member” - a Former Commendable Student who has been elected to membership in Milton Hershey’s Alumni Association by a majority of the existing members of such Alumni Association present at any meeting of such Alumni Association.

“Original Deed of Trust” - that certain Indenture made November 15, 1909 by Milton S. Hershey and Catherine S. Hershey, accepted by the Hershey Trust Company on April 14, 1910, accepted by the original Managers on April 14, 1910 and recorded in the Office of the Recorder of Deeds of Dauphin County, Pennsylvania in Deed Book “E,” Volume 14, Pages 331-345, on July 7, 1910.

“Orphan” - all Current Beneficiaries who are not Scholars, which (as distinguished from a Scholar) would include any Current Beneficiary who, after repeated attempts are made to change the attitude of such person so that the Trust can help such person, is nonetheless: (a) not worthy either because of such person’s (i) unwillingness to apply themselves or (ii) nasty desire to break the rules of the School, or (b) not demonstrating sincerity of purpose in the program which such person is undertaking, or (c) more of a hindrance than a help and does not want and will not cooperate in taking what the Trust has to offer, or (d) a person who does harm and will accept no good.

“Orphan Benefits” - an Orphan’s Basic Capital for Success.

“Orphan Capital for Success” - in the context of each Orphan, the Trust’s investment in such person their Basic Capital for Success. 

“Orphan Term” - in the context of each Orphan, the period of time from and including the date on which such person is admitted to the School to and including such Orphan’s Education Completion Date, subject to the ongoing Trust’s School Family Obligations.

“Orphan Termination Event” - in the case of each Orphan, the Managers decide such person may be dismissed, removed or expelled from the School because such person (i) has become incompetent to learn, or to master a trade, or (ii) from physical ailments it would be inexpedient for such person to continue their studies and training, or (iii) became insubordinate, or guilty of vice or crime, or became an unfit companion for the others, or (iv) has so conducted himself as not worthy of future and continued support and education, or (v) is so competent to work at his chosen trade, that he is qualified to be self-supporting, or (vi) for any other good and sufficient reason, under Paragraph 20 of the Deed of Trust, which would mean for purposes of Paragraph 16 of Milton Hershey’s Deed of Trust (and Paragraph 15 of the current Deed of Trust) that such Orphan (a) from November 15, 1909 through November 14, 1976, no longer merits remaining at the School until they reach the age of 18, or (b) from and after November 15, 1976, in the opinion of the Managers, is no longer a worthy student making satisfactory progress and can be dismissed from the care of the Managers and removed or expelled from the School.  These matters are to be determined in the opinion or judgment of the Managers.

“Orphans’ Court” - the Orphans’ Court Division, Court of Common Pleas of Dauphin County, Pennsylvania.

“P.N. Hershey” - P.N. Hershey, who in 1950 was the Agricultural Director of The Hershey Estates Farm Dept.  He was a Manager from 1935 to 1956.

“Proposed Greenway Easement” - the proposed “greenway” easement, which was “to perpetually preserve for conservation purposes a portion of School Trust real estate, consisting of approximately 1,000 acres along 11 miles of the Swatara Creek in Dauphin County, as more particularly described in Exhibit “A-12" to the Appendix,” as proposed in the 1999 Cy Pres Petition.

“Proposed Third Restated Deed of Trust” - the drafted, but not approved, Third Restated Deed of Trust, drafted by Richard M. Glanton, Esq., as counsel for Milton Hershey School, approximately 1990-1991.^[49]

“Requirements for Admission” - under the Deed of Trust means, consistent with the operation of the Hersheys’ Children’s Home in perpetuity for the full development of the whole person admitted to such home, only a child determined at the time of admission to be a child: (1) who is dependent to the extent of not having sufficient means to properly support and educate such person (that is, such child is determined to be in need of the institutional care of the Hersheys’ Children’s Home), (2) (a) with hereditary traits, physical and mental, that fall within expected and accepted norms for a child that is dependent or in need of the institutional care of the Hersheys’ Children’s Home, and (b) that does not suffer from physical ailments that would make it inexpedient for such person to continue such person’s studies and training at the Hersheys’ Children’s Home, (3) with character traits and observable behavior that fall within expected and accepted norms for a child that is dependent or in need of said institutional care, (4) with at least a normal or average intelligence quotient and not otherwise incompetent to learn, or to master a trade, (5) likely to benefit from the Hersheys’ Children’s Home’s efforts to fully develop such person as a whole person, (6) born in the United States of America, (7) from November 15, 1909 through December 24, 1970, who is subject to Indenturing, and (8) who is (a) from November 15, 1909 through October 29, 1933, a white male between 4 and 8 years of age whose father is dead, (b) from October 30, 1933 through December 23, 1970, a white male between 4 and 14 years of age whose father or mother is dead, (c) from December 24, 1970 through November 14, 1976, a male between 4 and 16 years of age whose father or mother is dead, and (d) from and after November 15, 1976, a child between 4 and 16 years of age whose father or mother is dead or who is otherwise not receiving adequate care from one of such child’s natural parents.

“Resident Employee” - any officer, director or employee of any Hershey Interest located within the Hersheys’ Children’s Home Campus or otherwise serving the Hersheys’ Children’s Home and residing on the Hersheys’ Children’s Home Campus.

“Resident Non-Employees” - the individuals residing on the Hersheys’ Children’s Home Campus who are not employees of any of the Hershey Interests.

“Resident Beneficiary” - a Current Beneficiary that is receiving Direct Education.

“Rudisill” or “Richard A. Rudisill” or “Dr. Rudisill” - Richard A. Rudisill.  In April 1951, Rudisill, the school’s first Headmaster, joined the school faculty as a reading teacher in Memorial Hall. On August 1, 1958, Rudisill was appointed Assistant Superintendent of the Milton Hershey School.  Rudisill was appointed Headmaster of Milton Hershey School, a Pennsylvania nonprofit corporation, on January 3, 1963, upon the election of John O. Hershey as President of Milton Hershey School, a Pennsylvania nonprofit corporation. On July 16, 1974, Rudisill was named Vice-President Headmaster, Milton Hershey School. On August 1, 1983, Rudisill was named Senior Vice President of Milton Hershey School.  On September 1, 1984, Rudisill, Senior Vice President, retired from Milton Hershey School after 33 years of service. Rudisill died on December 3, 1987.^[50] 

“Scholar” - each Current Beneficiary who is doing their best to take full advantage of the opportunities presented to such person through the Trust.^[51]

“Scholar Additional Education” - such additional education (including at other schools, colleges or universities) (which is to be determined after ascertaining and considering the Scholar’s unique tastes, capacity, intelligence and adaptability) as is sufficient such that, on a self-reliant basis, such Scholar is able to support himself or herself in some occupation or mechanical trade determined by his or her unique tastes, capacity, intelligence and adaptability.

“Scholar Benefits” - in the context of each Scholar, such person’s Scholar Capital for Success.

“Scholar Capital for Success” - in the context of each Scholar, such Scholar’s Basic Capital for Success and Scholar Mandated Education.^[52]

“Scholar Core Education” - such Vocational, Agricultural and Academic Education (which is to be determined after ascertaining and considering the Scholar’s unique tastes, capacity, intelligence and adaptability), Character Education, and Self-Reliance Education as is sufficient such that, on a self-reliant basis, such Scholar is (i) “when he or she leaves the School on the completion of the period for which he or she is to remain,” “able to support himself or herself”^[53] in some occupation or mechanical trade, (ii) moral, (iii) religious, (iv) truthful, (v) financially responsible and (vi) industrious.

“Scholar Mandated Education” - in the case of each Scholar:

(a) where (i) there is sufficient income for the purposes under Paragraph 21 and (ii) the Scholar’s unique tastes, capacity, intelligence and adaptability do merit going to another school, college or university whether as part of, or upon completion of, his Minimum Education, the education through other schools, colleges or universities required to provide such Scholar his Scholar Core Education and Scholar Additional Education, and

(b) otherwise, the education required to provide such Scholar with his Scholar Core Education,

which education in each case (a) and (b) above is mandatory and must be determined based upon such Scholar’s individual taste, capacity, intelligence, and adaptability and must be provided through Direct Education, Character Education, Self-Reliance Education and Indirect Education, as the case may be; that is, during and following such Scholar’s Minimum Education, the Managers must exercise all such other requisite efforts (e.g., mentoring, transition, placement and other programs directly and in cooperation with the Alumni Association, and so long as there is sufficient income from the Trust, education through other schools, colleges, or universities) to provide the maximum assurance that each Scholar becomes self-reliant and is successful in life.^[54]

“Scholar Term” - for each Scholar, the period during which such Scholar’s status of a Current Beneficiary continues which beneficiary status extends beyond the receipt of a Minimum Education and lasts until such Scholar’s Education Completion Date, subject to the ongoing Trust’s School Family Obligations.

“Scholar Termination Event” - in the case of each Scholar, the Managers decides such Scholar deserves removal or expulsion under Paragraph 20 of the Deed of Trust.

“School” - the “institution” founded and endowed in perpetuity pursuant to the Deed of Trust (and the first “institution” named in the Deed of Trust), named “The Hershey Industrial School” from November 15, 1909 until December 16, 1951 and as the “Milton Hershey School” from and after December 17, 1951, and designated as the “School” in the first recital of the Deed of Trust, “to be located in Derry Township,” which Joseph Gumpher refers to as the “charitable institution” in contrast with the Managers which he refers to as the “corporate fiduciary.”^[55] The School is the Hersheys’ Children’s Home and includes, among other things, the “ideal community,” the Hersheys’ Children’s Home Campus (including Hershey, Pa.), Hershey Estates, the Hershey Chocolate Company and its successors and the school. 

“school” - the residential, educational and other related facilities and employees that directly serve the Resident Beneficiaries and Non-Resident Beneficiaries, which comprise a major component of the School but are distinguished from the School. This distinction from the “School” is emphasized by the 1933 Deed Modification which added the provision, “No person employed by the school, in any capacity, in connection with which any compensation or expenses are directly or indirectly paid, shall at the same time serve as a member of the Managers of The Hershey Industrial School,” as Paragraph 29 of the Deed of Trust. When Paragraph 29 was added, the reference to “school” became the only provision of Milton Hershey’s Deed of Trust where the term “school” was not “School” as the institution was so designated in the Original Deed of Trust.  In both the 1933 Petition and the 1933 Decree, the parties requested, and the Court decreed, that “No person employed by the school, in any capacity, in connection with which any compensation or expenses are directly or indirectly paid, shall at the same time serve as a member of the Managers of The Hershey Industrial School.”  In the 1933 Petition, reference was expressly made to the “School” when quoting the Original Deed of Trust.  However, in the same document, the relief sought refers to the “school.”  This pattern of distinction is likewise maintained in the 1933 Articles of Amendment of Certificate of Incorporation, dated October 30, 1933, which arose solely as a result of the 1933 Decree. The following five points support the understanding that the “school” was viewed as a part of the Hersheys’ Children’s Home or the School, but not all of it:

1. Managers worked for Hershey Estates during M.S.’s lifetime, which employed both employees of the school as well as employees of other Hershey Interests,
2. Hershey Estates managed the overall operation of the Hershey’s Children’s Home,
3. the language of the Deed of Trust expressly distinguishes between the “School” and the “school,”^[56]
4. the language of the Articles of Amendment clearly distinguished between the incorporated Managers, the School and the school, and
5. during this period, John Snyder remained the primary legal counsel to all Hershey Interests and M.S.

Refer to Sections 3.4(d) and 3.4(e), and Appendix XXIII for detailed analysis of the “school” and the various documents that manifest the school’s separate existence within the “School.”

“School Administration” - the senior administration of the school; likewise “School Administrator” means a member of the School Administration.

“School Archives” - the Historical Archives and/or Historical Records of the Milton Hershey School.

“School Family” - the institutional family created by the Hersheys and the original senior members of which were the Hersheys and others like the Copenhavers, which is comprised of all of the past, present and future Managers, school administrators, teachers, houseparents, staff, former students and students of the school, who once a member of the School Family forever will remain part of the School Family, not to replace, nor compete with, biological families, but rather to supplement them.

“School Family Benefits” - in the case of each Current Beneficiary, the benefits derived from being provided a “Home,” which Home includes: (a) a residence at the Hersheys’ Children’s Home Campus while a Resident Beneficiary, (b) being a part of the social unit formed by a family living together (that is, one’s close family and self) – that is, the “School Family”, (c) while a Non-Resident Beneficiary, a place to which one intends to return, and (d) such Current Beneficiary’s place of origin and emotional attachment, as well as (2) being part of the School Family as it further develops and enjoys continued excellent health through the Managers and other members of the School Family (1) keeping in touch and corresponding with, keeping a close relationship with, assisting in procuring employment for and providing other necessary assistance to, all Former Students and (2) looking after the general welfare of all Former Good Students, Former Commendable Students and Original Alumni Association Members, as well as (3) looking after the general welfare of those who were formerly students at The Hershey Industrial School (now known as the Milton Hershey School) and left there with a good record.

“Self-Reliance Education” - both before and after leaving the School, programs designed to insure each Scholar’s effective and healthy assimilation into society in preparation for becoming self-reliant, provided directly by the Trust and in cooperation with the Alumni Association (e.g., mentor, transition, placement and other programs).  

“Snavely” or ”Joseph Snavely” or “Joseph Richard Snavely” - Joseph Richard Snavely, Milton S. Hershey’s cousin. Milton Hershey shared his thoughts with Snavely, who then recorded Milton Hershey’s words. Rudisill confirms that Hershey shared his thoughts with his cousin and that Hershey’s words were recorded by Snavely. [See 1962 Rudisill , p. 261 and 262]  Moreover, Snavely published several works regarding Milton Hershey. Two of them are A Chat with Mr. Hershey, published before Milton Hershey’s death and An Intimate Story of Milton S. Hershey.

“Trust” - the formal, legal entity created pursuant to the Deed of Trust and commonly referred to as the “Milton Hershey School Trust,” formerly known as “The Hershey Industrial School Trust.”

“Trust’s School Family Obligations” - include the Managers’ (1) obligations to provide a “Home” to both Orphans and Scholars, which Home is to include: (a) a residence, (b) the social unit formed by a family living together (that is, one’s close family and self) – that is, the “School Family”, (c) if no longer one’s residence, a place to which one intends to return, and (d) as one grows older, it is likewise one’s place of origin and emotional attachment, as well as (2) undertakings or responsibilities for the further development and continued excellent health of the School Family by undertaking responsibility for (1) keeping in touch and corresponding with, keeping a close relationship with, assisting in procuring employment for and providing other necessary assistance to, all Former Students and (2) looking after the general welfare of all Former Good Students, Former Commendable Students and Alumni Association members, as well as (3) looking after the general welfare of those who were formerly students at The Hershey Industrial School (now known as the Milton Hershey School) and left there with a good record.

“Trustee” - the Hershey Trust Company of Hershey, Derry Township, Dauphin County, Pennsylvania, designated “as Trustee” and “party of the second part” under the Deed of Trust, in its capacity as Trustee under the Deed of Trust.

“USPS” – United States Postal Service.

“Vocational, Agricultural and Academic Education” - both before and after leaving the School, the education contemplated by Paragraph 17 of Milton Hershey’s Deed of Trust comprised of instruction in the several branches of a sound education, agriculture, horticulture, gardening, such mechanical trades and handicrafts as the Managers may determine, and such natural and physical sciences and practical mathematics as in the opinion of the Managers it may be important for the Orphans to acquire, and such other learning and science as the tastes, capacities, and adaptability of the several Scholars may merit or warrant, to fit themselves for the trades they are to learn, and a useful occupation in life, bearing in mind that the main object in view is to train young men to useful trades and occupations, so that they can earn their own livelihood; one of the objects of the School being to teach and instruct in agriculture, horticulture, and gardening, each Orphan admitted to the School shall at such time or times as may be required, do such work upon the farms as may suit his capacity and ability, which includes vocational, agricultural and academic education.^[57]

“Whiteman” or “Arthur Whiteman” - Arthur R. Whiteman, the 38^th student admitted to the School who graduated from the Derry Township public school system as a member of the HIS Class of 1927. Whiteman was picked by Milton Hershey when Whiteman was only 15 years of age (and still attending school and living on the Hersheys’ Children’s Home Campus) to work at the Hershey Trust Company.  Thus, Whiteman worked at the Hershey Trust Company before he was discharged from the custody and control of the Board of Managers under his Indenture. Whiteman, HIS Class of 1927, was the first President of Milton Hershey’s Alumni Association (1930 to 1932) and continued as an officer as Past President from 1933 to 1936. He was made a Manager in 1939 even though he was only thirty years old at the time.^[58] The average age of Milton Hershey’s other trusted advisers on the Board of Managers was twice Whiteman’s age. Arthur Whiteman served on the Board of Directors of the Hershey Trust Company from 1939 through 1974. He served the Hershey Trust Company as Treasurer from 1934 through 1956, as Secretary from 1940 through 1962, as a Vice President from 1956 through 1962, as President from 1962 through 1974 and as Chairman in 1974. He retired from the Hershey Trust Company on July 30, 1974 following 50 years of service. He served on the Board of Managers from 1939 through 1974 and was Treasurer 1939-1956 and Secretary 1939-l962. He served HERCO from 1950 to 1974, as a Vice President from 1950 to 1962 and as its President from 1962 to 1967. He served on the Board of the M.S. Hershey Foundation from 1939 through 1974, serving as Treasurer from 1939 through 1956 and as Secretary from 1939 through 1962.  Whiteman died on June 30, 1988.^[59]

“World War I” - the war generally referred to today as World War I, which began in August 1914 and lasted until November 1918, and in which the United States of America became active on April 6, 1917 when Congress declared war against Germany and expanded its role on December 7, 1917 when Congress declared war against Austria-Hungary.^[60]

“World War II” - the war generally referred to today as World War II, which began in September 1939 upon Germany’s invasion of Poland and lasted until September 2, 1945 upon the surrender of Japan, and in which the United States of America became active on December 7, 1941 – Japan’s attack on Pearl Harbor – which was immediately followed by the United States of America’s declaration of war on Japan on December 8, 1941 and Germany and Italy’s declaration of war on the United States of America on December 11, 1941.^[61]

“Year-round” - 365 days per year, subject only to such leaves of absence as are necessary to maintain family ties where appropriate, and so long as such leaves of absence are of a duration that they do not compromise the year-round caretaker function of the School or the healthy development of the child.

 

---

[1] See document of conveyance signed by M.S. Hershey on January 5, 1918, effective as of January 1, 1918.  A copy of this document was obtained through the Hershey Trust Company.  Refer to Appendix X: 1918 Conveyance of Non-Chocolate Assets to Hershey Chocolate Company.

[2] See letter dated November 14, 1918 from M.S. Hershey to the Hershey Chocolate Company.  A copy of this document was obtained through the Hershey Trust Company.   Refer to Appendix XII: 1918 Letter to Hershey Chocolate Company. 

[3] 1992 Hershey Heritage Re John Snyder, p. 6.

[4] 1992 Hershey Heritage Re John Snyder, p. 6.

[5] 1992 Hershey Heritage Re John Snyder, p. 6.

[6] Refer to America’s Great Depression, April 25, 2001, at http://www.amatecon.com/greatdepression.html. 

[7] The 1933 Petition arose largely due to concern that the Trust fund was growing at a rate greater than the rate at which income could prudently be spent at the school to serve the class of needy children identified in the Original Deed of Trust.  See, for example Appendix XVII: 1933 Petition, at Paragraph 9, which reads: “As restricted in the deed of trust, the income is greatly in excess of what is required and can be used for said purposes; and, unless the terms and conditions of the trust may be modified, the income must be permitted to accumulate, and your petitioner will not be permitted to expend the same.”  Thus, the 1933 Petition argued, and the 1933 Decree concluded, that a deviation was in order as to age and the identity of surviving parent so as to better achieve the Hersheys’, including Milton Hershey’s, original intent – to admit as many children as the income and other resources would permit.

New Paragraph 29 of the Deed of Trust emphasizes the distinction between (1) the “permanent institution” known as The Hershey Industrial School referenced and designated as the “School” in the first recital of the Deed of Trust, (2) the “school” referenced and also named The Hershey Industrial School in Paragraph 11 of the Deed of Trust, and (3) the incorporated Board of Managers, likewise named The Hershey Industrial School (a Pennsylvania nonprofit corporation) in Paragraph 28 of the Deed of Trust. Refer to Sections 3.4(d) and (e), as well as Appendix XXIII. It is commonly believed today that the addition of Paragraph 29 of the Deed of Trust was added to protect the “school” from certain conflicts. Based on the timing of the 1933 Decree, the 1933 Paul Reed Memo, the 1935 M.S. Hershey Foundation, and the 1936-37 labor activities, it seems likely that this provision could have been added to protect the entirety of the “School” from domination by those at the school, who were closest to the Current Beneficiaries. Moreover, the Managers already owed their fiduciary duties to the Beneficiaries.

[8] Paragraphs 3-5 of the 1933 Petition state:  “3. Pursuant to the provisions of the deed of trust, The Hershey Industrial School was established on or about the third day of September, 1910; and was conducted and managed by said Managers and their successors as an unincorporated school for the purposes and subject to the conditions in the deed of trust set forth, until the thirtieth day of December, 1919.  4. On the’ thirtieth day of December, 1919, your Honorable Court entered a decree incorporating the Managers and their successors as a corporation of the first class, under and subject to the provisions of the Act of Assembly approved the 29th day of April, 1874, entitled “An act to provide for the incorporation and regulation of certain corporations,” under the name and style of “The Hershey Industrial School,” your petitioner herein. The charter granted to your petition is recorded in the office for the recording of deeds, etc. aforesaid, in Charter Book L, page 282, etc. A copy thereof is attached hereto, marked “Exhibit B” and made a part hereof.  5. Upon its incorporation, your petitioner took over the control and management of the school and has since and is now conducting the same as contemplated by, and under the conditions and limitations contained in, the deed of trust.  6. At the time of, and from time to time subsequent to, the establishment of the school, Milton S. Hershey.[…]”  The bolded words are missing or changed in the 1951 Petition.

[9] Richard Wallace Murrie is the son of William Franklin Reynolds Murrie, who was once a President of the Hershey Chocolate Company and member of the Board of Managers.

[10]  Refer to the 1984 Alumni Association Articles of Amendment.

[11] This change was made in response to concerns that the term “industrial school” had become a pejorative term, implying that the students had been committed to the school by reason of some crime of delinquency.  Due to this colloquial change, Milton Hershey’s Deed of Trust was amended to avoid any misleading impressions concerning the students at the school. 

[12] Under “Other Major Anniversary Contributions” is listed “The Statue of Milton S. Hershey” under which is written:  “Presented to the school by the alumni as an expression of their love and appreciation to the one who founded the school and provided for its growth and constant improvement. The distinguished American sculptor, Walker Hancock, has caught the friendly spirit of Mr. Hershey in communication with a boy who represents all Milton Hershey School boys.  This bronze memorial stands in the foyer of the Junior-Senior High Building where it is a constant source of inspiration to the boys who pass it daily and to the host of visitors who frequent the campus.  “His Deeds Are His Monument […] His Life Is Our Inspiration”” [1959 Anniversary Lectures, p. 123]

Under “A Tribute To Milton S. Hershey” is written:  “Fifty golden years since your dream became a reality […] more than 2500 alumni of Milton Hershey School are “making their mark” in the world.  Good Americans […] good family men […] many of them leaders in government, in science, in commerce, and in industry. Yesterday ‘Milton Hershey boys’ […] today, leaders in the life of their community.” [1959 Anniversary Lectures, p. 124]

[13] In the 1959 Home Division Handbook, John O. Hershey states in the Introduction:  “The houseparent handbook was first developed in 1945 by a committee composed of both houseparents and department heads of the school.  It was officially adopted in 1946.  Minor revisions have been made from time to time, but this edition is the first major revision since its origin.”

[14] Rudisill writes of Milton Hershey in his Preface “He gave his wealth many years before his death in order that he might personally direct the early implementation of the Deed of Trust, the legal instrument which brought the home and school into existence.  It was his proud boast that he was the Executor of his own will.  It would have been difficult for him to have found a more worthy or more able administrator.”  1962 Rudisill, Preface.

[15] Paragraph 5 of the 1968 Petition states:  “Prior to August 23, 1963, the assets of the Foundation Trust were derived solely from the inter vivos gifts of Settlor [, Milton S. Hershey,] and subsequent gifts of the Hershey Foods Corporation, formerly Hershey Chocolate Company.”

[16] Of particular interest here is the modification which extended the upper limit of the age for admission to the school to permit admission of orphan boys who had not attained their sixteenth birthday.  Although the 1970 Petition did not directly address the issue of accumulation of income, the Board of Managers claimed in 1999 “the rationale for the particular request is consistent with the reasoning expressed in prior petitions:  namely that a pro tanto failure of the purposes of the Trust could occur (resulting in additional accumulation of income) due to the school’s inability to expend sufficient income in strict compliance with the Deed of Trust.”  Thus, the 1970 Petition, at Paragraph 49, stated as follows:

“Your Petitioners submit that the problems caused by the decrease in the number of orphans needing institutional care, which could cause a partial failure of the purposes of the Trust, would be alleviated by modification of the Deed of Trust to provide for the admission of orphans to but not including their sixteenth birthday.”  [emphasis added]

[17] 1971 Hostetter, p. 6-7: “Mr. Hershey lived his religion as well as any man I have ever known or been intimately acquainted with.  The core of Mr. Hershey’s religion was faith in God and in charity as a way to God in heaven and to peace and happiness on earth.  ‘I am a Christian in the only sense that Christ wished anyone to be, sincerely attached to his doctrine in preference to all others.  I became a Mennonite when I went to church with my mother, and I am still a Mennonite.’”

[18] Of particular interest here are the modifications which again expanded the class of persons eligible for admission to the school.  The theme of a “partial failure” is also repeated, with the 1976 Petition, at Paragraph 27, stating as follows:

Since the modification of the Deed of Trust of the School in 1970, certain factors noted at that time have continued to cause what your Petitioners believe is a partial failure of the purposes of the Trust, which partial failure your Petitioners submit can be alleviated by [the modifications expanding the class of eligible persons].

The 1976 Decree recognized this in its statement (at p. 1) that “the retention in the Restated Deed of Trust of the requirement that only males be admitted to the School is causing a partial failure of the purposes of the trust.[…]”

[19] Although “minor, incidental” support and use were approved, it appears that rather than limiting trust assets to such, these types of activities through 2002 in the aggregate far exceed the notion of “minor” and the notion of “incidental.”  The school shift to programs and student body that allow the children to go home for nearly half the year show that prior to the end of 2002 the School Administration was freeing up assets for use by the community and others, while eliminating “dependent” children from the program because they would not have a home to which they could return.  Refer to Twenty-Second and Partial Account.  (Docket Entries at No. 712 of 1963.)  Accountings - Applicable Years: 08/01/93 to 07/31/96 Date Confirmed by Court: 08/12/98.

[20] In his 1999 Adjudication, Judge Morgan denied the Trust’s petition for CHILD and the Greenway Easement.  Judge Morgan granted the petition for the Bike Path Easement.  Here are some important points that Judge Morgan makes in his decision:

• The vision of Milton and Catherine Hershey was to relieve poor children from all of the conditions of poverty; to undertake their total care and upbringing.
• Any discretion of the Board of Managers is servient to the dominant intent of the Hersheys to care for as many children at the School as the income will permit.
• We reject the Managers’ suggestion that conclusions reflected in decrees of this Court in prior proceedings in which the expression “pro tanto failure” was asserted are binding upon us in this proceeding.
• The specific intention of the Hersheys, as plainly stated in the Deed of Trust, was to remove children from an environment of poverty and to place them in a residential setting where they would be provided all of the necessities of food, shelter, clothing and health care together with moral and ethical guidance as well as class-room education.
• The proposed Institute does not approximate the Hersheys’ express intention for the Milton Hershey School and would do violence to it.
• When, in 1976, the Managers, alleging that the requested modification was consistent with the intent of the Hersheys, obtained from this Court a decree changing applicant eligibility to include males and females, whites and non-whites, and re-defined “orphan”, they forever [St. Mark 14:7] expanded the mission of the School and the charge upon its Managers.
• The express purpose to which the Hersheys dedicated their wealth is a structured, residential setting to which a child is removed from impoverished living conditions.  Any reading of the Deed of Trust must convince one that the Hersheys had in mind that theirs would be a direct gift to the child, with observable results.
• However well intentioned, the Managers’ idea of philanthropic efficiency is not a ground for cy pres.
• In the exercise of cy pres, deference to the “Dead Hands” of Milton S. Hershey and Catherine, his wife, need not be so rigid as to stifle resourcefulness but our discretion is not unfettered and, if exercised, must be within the limits of approximating the dominant intent of the Hersheys.  The proposed Institute does not come close.
• However worthy the motive of the Managers, the land is held under trust and their power to alienate such property is limited.  The Managers have a broad discretion to sell the land but it is well established that the power of sale conferred upon a trustee does not authorize an alienation of any character other than a sale.  The power to sell does not authorize a gift of the property.
• However, the duration of the easement [for the bike path] is for a limited period; the cost of construction will come from sources other than the trust, and the improvement will be a direct and readily available benefit to the School at its campus.  Under these circumstances, there is sufficient consideration received for the grant of the easement to support the conveyance.

[21] Mayer, Brown, Rowe & Maw is a combination of two limited liability partnerships, each named Mayer, Brown, Rowe & Maw LLP, one established in Illinois, USA and one incorporated in England.

[22]  Refer to America’s Great Depression, April 25, 2001, at http://www.amatecon.com/greatdepression.html. 

[23] These provisions remain unchanged under the Deed of Trust but have been renumbered as Paragraph 16 of the Deed of Trust.

[24] Paragraph 26 of the Deed of Trust

[25] In Cuba, Milton S. Hershey named his philanthropy in the same manner.  However, the philanthropy in Cuba revolved around the sugarcane plantation and related agrarian efforts.  That is, Milton S. Hershey also founded an orphan school, the “Hershey Agricultural School,” in Cuba.  Refer to Hershey Archives Web site at: http://www.hersheyarchives.org/Default.aspx?Page=Cuba (July 8, 2004).

[26] Paragraph 17 of the Deed of Trust

[27] In Cuba, Milton S. Hershey named his philanthropy in the same manner.  However, the philanthropy in Cuba revolved around the sugarcane plantation and related agrarian efforts.  That is, Milton S. Hershey also founded an orphan school, the “Hershey Agricultural School,” in Cuba.  Refer to Hershey Archives Web site at: http://www.hersheyarchives.org/Default.aspx?Page=Cuba (July 8, 2004).

[28] Refer to the Hershey Archives Web site at http://www.hersheyarchives.org/Default.aspx?Page=Cuba, July 7, 2004.

[29] 1962 Rudisill, p. 145. Rudisill quotes from “As I Knew Him,” by Milton S. Hershey, The School Industrialist, Vol. V, No. 8, (May 1938), p. 3.

[30] Note that Direct Education could include college education should the Managers add this to the School’s current program.  In fact, Milton Hershey’s Deed of Trust authorizes Direct Education to include college and post graduate education.  When Hershey Junior College existed, it provided Direct Education that included the first two years of college.

[31] These conclusions are consistent with the treatment of the same subjects in the Indenture entered into on behalf of the child as required by the Original Deed of Trust during the period the child remained a minor.

[32] In Cuba, Milton S. Hershey named his philanthropy in the same manner.  However, the philanthropy in Cuba revolved around the sugarcane plantation and related agrarian efforts.  That is, Milton S. Hershey also founded an orphan school, the “Hershey Agricultural School,” in Cuba.  Refer to Hershey Archives Web site at: http://www.hersheyarchives.org/Default.aspx?Page=Cuba (July 8, 2004).  

[33] This economic period actually represents two economic contractions separated by an incomplete expansion.

[34] Refer to America’s Great Depression, April 25, 2001, at http://www.amatecon.com/greatdepression.html. 

[35] Hershey Corporation owned the sugar interests in Cuba.

[36] Refer to http://www.hershey.k12.pa.us/the_schools/history_dtsd.html (July 7, 2004) for more detail.  

[37] Refer to http://www.hersheyarchives.org/Default.aspx?Page=Foundation for more detail.

[38] Appendix I: Development of The Hershey Industrial School illustrates this plan by providing a chronology organized around the three components of Community, Business and Education.  The Hersheys established a children’s home for the full development of the whole person, according to their respective attributes (that is, tastes, capacity, intelligence and adaptability), interests and commitment by providing them with, among other things, a real home and family that engendered a deep sense of belonging to a family and community.

[39] In 1936 in a speech honoring Milton S. Hershey, William Earnest (then a member of the Board of Managers) states that the President of Milton Hershey’s Alumni Association said:  “[…] I should say the school is my home. […] the boys made school life seem like family life.  That idea was Mr. Hershey’s from the beginning and still is.”  Note that this reference to “home” is not in the passed tense even though the President of the Alumni Association no longer lived at the school.  The understandings of alumni and students (i) that they have a Home and a School Family, as well as (ii) that these were Milton Hershey’s intended ideas originated from the beginning and is of the highest order of priority in defining oneself to others.  School Archives

[40] 2002 Stark Part I, p. 32.

[41] The form of Indenture remained unchanged in substance from 1910 through Milton Hershey’s death.

[42] Paragraph 15 of the Original Deed of Trust remained the same in Milton Hershey’s Deed of Trust and provides “No orphans shall be admitted until the surviving parent, guardian, or other competent authority shall have given by indenture, release, relinquishment, or other lawful acquittance, for such period as the Managers may determine, adequate power to the Managers, or others by them appointed, to enforce, in relation to each orphan, every proper restraint, and to prevent relatives, friends, or others from interfering with, or withdrawing such orphans from the institution.”

[43] Indirect Education must be provided by the Trust so long as there is sufficient income.  Refer to Paragraph 21 of the Deed of Trust.

[44] 1996 Hershey Chronology

[45] Paragraph 29 of Milton Hershey’s Deed of Trust reads: “No person employed by the school, in any capacity, in connection with which any compensation or expenses are directly or indirectly paid, shall at the same time serve as a member of the Managers of the Hershey Industrial School.”  In 1919 the Board of Managers was incorporated and this was the only expressed goal sought by Paragraph 28 of the Deed of Trust.  Moreover, Paragraph 29 of Milton Hershey’s Deed of Trust was, among other things, an endeavor to forever clearly recognize and preserve the separate identity of the “permanent institution” contemplated by the Deed of Trust, on the one hand, and the Milton Hershey School, a Pennsylvania nonprofit corporation (that is, the Managers), on the other. 

The incorporation of the Managers in 1919 was a wise decision following Milton Hershey’s contribution of $60,000,000 of Hershey Chocolate Company stock to the Trust in 1918.  It was designed to insulate the Trust corpus from, among other things, the potential liability associated with the Managers’ exercise of fiduciary duties to the individual beneficiaries of the Trust.

[46] 1950 Gumpher, p. 68.

[47] The Memorandum of Understanding states, in part, that “the beneficiaries of that Trust, namely the MHS students.[…]”  The Memorandum of Understanding reflects an understanding that the Milton Hershey School “is operated pursuant to a charitable trust” and that “the Managers are entrusted with the duty to operate MHS pursuant to the original Milton Hershey School Deed of Trust” and that the Memorandum’s references to the Milton Hershey School is not a reference to the incorporated Board of Managers.

[48] During the period from November 15, 1909 through December 23, 1970, Paragraph 16 of the Deed of Trust was Paragraph 17 of Milton Hershey’s Deed of Trust.

[49] The 21^st Century Initiative contains a number of admissions criteria and program changes that do not conform to the Deed of Trust.  Sometime after or in connection with the adoption of the 21^st Century Initiative, the 1990-1991 Board of Managers authorized the drafting of a proposed “Third Restated Deed of Trust” by Richard M. Glanton, Esq., counsel for Milton Hershey School.  By its own terms, the Proposed Third Restated Deed of Trust was to have been submitted to the Orphans’ Court for approval as “Exhibit G” to a petition, which approval was anticipated for 1992. 

[50] 1996 Hershey Chronology  

[51] For clarity’s sake, the term “Scholar” does not include any person who, after repeated attempts are made to change the attitude of such person so that the Trust can help such person, is nonetheless: (a) not worthy either because of such person’s (i) unwillingness to apply themselves or (ii) nasty desire to break the rules of the School, or (b) not demonstrating sincerity of purpose in the program which such person is undertaking, or (c) more of a hindrance than a help and does not want and will not cooperate in taking what the Trust has to offer, or (d) a person who does harm and will accept no good.

[52] The Honorable Judge Warren G. Morgan stated in the 1999 Adjudication:

The vision of Milton and Catherine Hershey was to relieve poor children from all of the conditions of poverty; to undertake their total care and upbringing.

^[53] Refer to Paragraph 16 of the Deed of Trust, which is Paragraph 17 of Milton Hershey’s Deed of Trust.

^[54] Refer to Paragraphs 16 through 21 and Paragraph 23 of the Deed of Trust.  That Paragraph 23 of the Deed of Trust establishes a continuing obligation of the Trust after graduation from high school is observed by W. Allen Hammond, Principal of Milton Hershey School from 1934 through 1959, in his book A Man and His Boys, when he states “In fact, in accord with section 23 of the ‘Deed’ [...], a Placement Service has been set up, which not only secures employment for boys but also follows up on them to assist those who may encounter difficulties of adjustment, to change assignments for those who should change, to stimulate some who may be prone to mark time, to commend those who succeed, and to make contacts for others who follow.  An attempt is made to fit the boy to the job or the job to the boy so that he may make his best and happiest contribution to the world of productive work in college, business or industry.”  [1969 Hammond, p. 23-24]

[55] 1950 Gumpher, p. 68. This legal fact continued to be repeated to the Orphans’ Court for a long period of time. In fact, the term “School” was defined in the 1970 Petition in the following manner: “By deed of trust dated November 15, 1909 […] Milton S. Hershey and Catharine [sic] S. Hershey [...] granted and conveyed certain real estate [...] to your Petitioner, Hershey Trust Company, as Trustee, (hereinafter called “Trustee”) and constituted M.S. Hershey, W.H. Lebkicher, [...] and their successors, Managers (hereinafter called “Managers”) for the purpose of founding and endowing in perpetuity an institution to be known as “The Hershey Industrial School”, now known as the “Milton Hershey School”, (hereinafter called “School”) for the maintenance, education and training of “poor, healthy, white, male orphans,” subject to certain trusts and conditions set forth in  the Deed of Trust.” 

[56] Refer to Sections 3.4(d) and 3.4(e), and Appendix XXIII for detailed analysis of the “school” and the various documents that manifest the school’s separate existence within the “School.”

[57] This is now Paragraph 16 of the Deed of Trust.

[58] M.S. understood the benefits associated with grooming Scholars in fulfillment of the Hersheys’ design “to build a town to be run by and for orphan boys” and selected Whiteman, HIS Class of 1927, at age 15 to begin Whiteman’s grooming that resulted in Whiteman becoming a Manager on May 11, 1939 and remaining a Manager through 1974.  Whiteman was a member of Milton Hershey’s Alumni Association’s Board from its creation in 1930 through 1953, and from 1976 through 1979, and during 1981, 1983, 1984, 1985, 1987 and 1988.  Arthur Whiteman was the first recipient of the Alumnus of the Year recognition award. He died in 1988.  Arthur Whiteman, as well as other Scholars such as Joseph Gumpher, Kenneth Hatt, William Dearden and others who came later, personified the Hersheys’ design “to build a town to be run by and for orphan boys.”  Milton Hershey’s Alumni Association was designed by Milton Hershey as the entity that in perpetuity would continue to groom other Scholars to follow and continue to fulfill the Hersheys’ design “to build a town to be run by and for orphan boys,” as well as to serve students, Alumni, the School, the School Family, the school and the Trust.

[59] 1996 Hershey Chronology 

[60] Refer to America’s Great Depression, April 25, 2001, at http://www.amatecon.com/greatdepression.html. 

[61] Refer to America’s Great Depression, April 25, 2001, at http://www.amatecon.com/greatdepression.html. 

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