LEGAL MODIFICATIONSTO THEMILTON S. HERSHEYCATHERINE S. HERSHEYDEED OF TRUST OF 1909
Prepared by: The National Hershey Association
SUMMARY OF LEGAL MODIFICATIONS TO THE MILTON S. HERSHEY & CATHERINE S. HERSHEY DEED OF TRUST OF 1909
DETAILED CHRONOLOGY OF EVENTS RELEVANT IN, AND LEGAL MODIFICATIONS TO THE MILTON S. HERSHEY & CATHERINE S. HERSHEY DEED OF TRUST OF 1909
- Milton S. Hershey and Catherine S. Hershey sign their Deed of Trust in New York, New York. This Deed is established for the sole "purpose of founding and endowing in perpetuity an institution to be known as the Hershey Industrial School; herein after designated as the School. " The sole beneficiary of this Deed of Trust was identified and restricted to, poor orphan white male children between the ages of 8 through 18 years of age. Article 14 of this Deed states that "preference shall be given in the admission; First, - to those born in the Counties of Dauphin, Lancaster, and Lebanon, State of Pennsylvania: Second, - to those born elsewhere in Pennsylvania; Third - to those born elsewhere in the United States." Article 11 of the Deed further stipulates that this institution "shall be permanently located in Derry Township, Dauphin County, Pa., upon the land hereby conveyed."
April 14, 1910 - As sole trustee, the Hershey Trust Company Board of Directors establish the School's first Board of Managers who affixed their signatures to the Deed of Trust. July 7, 1910 - The original fourteen page Deed of Trust was recorded in the Office of the Recorder of Deeds of Dauphin County, Pennsylvania in Deed Book E, Volume 14, Pages 331-345.
September 3, 1910 - Pursuant to the terms and conditions of the Deed of Trust, on or about this date, the Hershey Industrial School was established and began operations as an unincorporated entity.
March 25, 1915 - Catherine S. Hershey died and was survived by her husband, establishing Milton S. Hershey as sole Settlor of the Deed.
- The Court of Common Pleas of Dauphin County, Pennsylvania issued an order authorizing the Board of Managers, and their successors, of the Hershey Industrial School as a corporation of the first class. This charter is recorded in the Office of the Recorder of Deeds in Dauphin County, Pennsylvania in Charter Book L, Page 282.
- In the first modification of the Deed, the Court approves a petition from the Settlor, acting as Chairman of the board of trustees, whereby authorizing a provision to be incorporated into the Deed so that (1) "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," and (2) to facilitate for the School's expansion in order to allow "as many children as ... income will provide for... [N/V]", and (3) to expand the definition of "orphan" to allow for the enrollment of boys who were survived by a single parent, whereas before only children who had lost both parents could be admitted, and (4) to expand the School's enrollment of boys from age four from the previous minimum age of eight. The Consent of the School's Board of Managers to Amend the Articles of Incorporation was filed in Docket No. 201, September Term 1933 of the Court of Common Pleas of Dauphin County with an additional filing entered in Equite Docket No. 1096, October 30, 1933.
- The Chairman, and six members of the School's Board of Managers, served
jointly to establish "in perpetuity a Foundation for educational
purposes to be known as the M.S. Hershey Foundation" for the benefit "of
any resident of Derry Township." The beneficiary of this trust
included the graduates of the School*, employees of
the Corporation, and any member of the Community
each of which were established by Milton S. Hershey. The Milton S. Hershey Trust
Agreement was recorded in the Dauphin County Office of the Recorder of Deeds in
Misc. Book "X, " Volume 4, Page 442.
October 13, 1945 - Milton S. Hershey dies in the Hershey Hospital at age 88.
- The second modification of the Deed was approved by the Orphans' Court authorizing the name of the institution to be changed through language that reads; "The institution shall be known as the 'Milton Hershey School' and shall be permanently located in Derry Township, Dauphin County, Pa., upon the land hereby conveyed." The reason for the name change was made in order to prevent any public misunderstanding that the School was a youth correctional institution. This instrument was entered in Dauphin County Orphans' Court Docket No. 824, on December 17, 195 1. The Amendment to the Articles of incorporation were recorded in the Office of the recording of deeds, etc, 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.
- The third modification to the Deed was initiated by three alumni of the Pennsylvania State University (PSU), who acted in concert with and through, the Hershey Trust Company Board of Directors and the Milton Hershey School Board of Managers to petition the Court for changes to the existing restrictions contained in the Deed. The petition asserted that these restrictions had caused a "partial failure" of the Trust. The trustees reported that the orphans' Fund was then valued at over $270,000,000, with an 'excess income' of $96,000,000. Presented with the "Cy Pres" petition, on the same day, the Court authorized the modification allowing the Trustees to divert $50,000,000 from the orphans' endowment to the community fund, (the M.S. Hershey Foundation), for the purposes of establishing a medical research and teaching institution for PSU. This instrument was entered in Dauphin County Orphans' Court Docket No. 712 of 1963 on August 23, 1963. This modification was authored by attorney Gilbert Nurick and approved by Lee F. Swope, Presiding Judge of the Orphans' Court Division.
- Petition and Order to lease realty filed in the Dauphin County Orphans' Court [OC G-4 ]
- Petition and Order to lease realty filed in the Dauphin County Orphans' Court [OC H-4]
- Hershey Trust Company, as Trustee for the M.S. Hershey Foundation filed, and were granted, a petition appointing PSU as the "Successor Trustee" for the $50,000,000 in funds and assets previously transferred for the establishment and maintenance of the PSU research and teaching institution in Derry Township. This Petition alleges that it was necessary for the Trustees to transfer the legal title to the funds assets and real estate to PSU. The Petition informed the Court of "the serious and grave impediment which the connection of the Foundation Trust places in the path of federal and private grants and loans." The Court approved the Petition in order for PSU to receive unrestricted research grants from the government. The instrument was filed in Dauphin County orphans' Court Docket No. 712 of 1963. This Petition was authored by attorneys Gilbert Nurick, Rod J. Pera, Samuel A. Schreckengaust, Jr., and Jack A. Riggs. The Petition was granted by Lee F. Swope, Presiding Judge of the Orphans' Court Division.
May 22,1968 - The Board of Managers announced a new policy of accepting applications for admission to the Milton Hershey School without regard to racial criteria previously specified in the Deed of Trust. The Board moved to adopt this policy based on the legal opinion of the Manager's counsel of the law firm McNees, Wallace & Nurick . Attorney Gilbert Nurick had determined that the ethnic restriction in the Deed was unconstitutional pursuant to the enactment of the Fourteenth Amendment to the Constitution United States.
February 25, 1969 - Hershey Trust Company conveys medical center buildings and real estate to Pennsylvania State University [DC Recorder of Deeds Office Book 0 Vol. 54 page 5091
April 30, 1969 - Hershey Trust Company conveys additional real estate to Pennsylvania State University [DC Recorder of Deeds Office Book T Vol. 54 page 318]
January 1970 - Attorney Gilbert Nurick is elected to serve on the board of trustees of the M.S. Hershey Foundation Trust. [Mr. Nurick serves two concurrent one-year terms on this board.]
- The fourth modification to the Deed was executed by the Hershey Trust Company Board of Directors and the Milton Hershey School Board of Managers, who petitioned to, and received the Court's blessing on the same day, to implement prolific changes in governing the Trust. Among the changes therein, this modification served to (1) allow for the expanded enrollment of male children of ethnic minorities, (2) "inclusion in the Deed of Trust of a provision authorizing payment by the Trustee of the reasonable expense which the managers shall incur in the performance of their duties. (3) The Court authorized the removal of specific language that was previously inserted in the Deed by the Settlor during 1933, which stipulated 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. " This Petition informed the Court that "This restriction operates to separate from the governing authority of the school certain classes of people whose management, legal and educational expertise would permit them to make an important contribution to the Board of Managers." The Court authorized "the amending of the provisions... to allow officers, counsel, and consultants to serve on the Board." (4) The Petition sought further to "liberalize" the requirement of "the duty of the Trustee to exhibit to the Managers, and duty of the Managers to carefully examine and count the several securities, and to verify them with the statements and accounts furnished and kept by the Trustee." (5) To permit the "Managers to delegate" their responsibility and to deviate from the previous general investment policy of the Board of Managers pursuant to the original provisions in the Deed. (6) Allow the School to enroll students who have "not yet attained his sixteenth birthday at the time of admission," increasing the original admissions restriction of 14 years of age. (7) While maintaining some of the original restrictions in Paragraph 7, the Trustees informed the Court that the institution "in Deny Township" might acquire and use additional land because "the School may in the future expand beyond the land, which it presently occupies." (8) Due to the repeal of laws regarding the legal authority of the School to "indenture the child to the Managers" Paragraph 15 of the Deed was omitted and modifications made to others. (9) Citing "the problems caused by the retention of more land than the School can profitably use, which retention is causing a partial failure of the purposes of the Trust," that portion of Paragraph 6 of the Deed was eliminated which had stated that "No part of the proceeds of the sale of any land or of the principle of the trust as it is now, or additions thereto, by gift or otherwise, shall ever be expended for any purpose whatever, except for the purchase of additional land for the purposes of the School." (10-a) Because approximately one half of the students of the School reached the age of 18 prior to graduation, the language in Paragraph 16 was altered to permit each scholar to remain for the full completion of secondary education regardless of age. (10-b*) The Managers revised language in Paragraph 21 to allow for, at their discretion, to extend the Trust benefits to orphans whom were deemed worthy "to provide for or contribute toward the further education of the scholar at some other school, college, or university." (11) Citing a problem due to past modifications, the Court authorized that the previous modifications of 1933, 1963, 1951 & 1970 be consolidated in issuing a restated Deed of Trust of Milton Hershey School. This Petition was authored by attorneys Gilbert Nurick and Jack A. Riggs. PA Attorney General Fred Speaker found "no objection" and endorsed this modification. The Petition was presented to, and granted on the same day, by Lee F. Swope, Presiding Judge of the Orphans' Court Division.
January 1971 - McNees Wallace & Nurick founding partner Gilbert Nurick is elected to serve on the board of trustees at the Hershey Trust Company and on the Board of Managers of the Milton Hershey School. [Mr. Nurick served on these boards for a single one-year term.]
- Dauphin County Orphans' Court issues a "Decree for Modification to the Decree to Permit a Sale of Certain Real Estate." This sale was Milton Hershey School Farms # 37-A, 37-B & 53 N/V] [OC M-4 page 3951] Hershey Trust Company conveys an additional 22 acres of real estate to Pennsylvania State University for "$1.00." [DC Recorder of Deeds Office Book P Vol. 58 page 492]
January 1974 - McNees Wallace & Nurick partner, attorney Samuel A. Schreckengaust, Jr., is elected to serve on the board of trustees of the Hershey Trust Company and the Board of Managers of the Milton Hershey School. [Mr. Schreckengaust served on these boards for four one-year terms.]
- The fifth major modification to the Deed was approved by the Dauphin County Orphans' Court by way of this "Petition and Order for Modification of Trust." This modification (1) enabled the enrollment of females in the School and (2) to expanded the definition of "orphan' 'to include any child not receiving adequate parental care at home, and thus allowing for the enrolment of any 'social orphan.' (3) The Petition corrected the misspelling of Catherine S. Hershey throughout the Deed and further (5) Amended the Restated Articles of Incorporation for the School. This Petition was authored by attorneys Gilbert Nurick, John S. Oyler and Richard R. Lefever. The Petition was granted by Lee F. Swope, Presiding Judge of the Orphans' Court Division [OC Q-4 page 129]
January 10, 1977 - McNees Wallace & Nurick attorney Jefferson C. Barnhart, as shareholder and corporate officer, serves as incorporator of "Hershey Summit, Inc." An unknown amount of shares were issued to directors Lee M. Smith and Roger P. Anderson. On an undetermined date, the Hershey Trust Company subsequently issues notes to "Hershey Summit" and two mortgages to "Hershey Summit A Partnership" which remain outstanding.
July 31, 1979 - McNees Wallace & Nurick attorney Richard R. Lefever, as a shareholder serves to register the corporation "Alexander Properties, Inc.," which issues 1,000 shares.
January 31, 1980 - Hershey Trust Company conveys an additional 163 acres of real estate to Pennsylvania State University for the consideration of $875,000. [DC Recorder of Deeds Office Book 10354 page 4261
- Dauphin County Orphans' Court approves a "Petition and Order for Approval of Consent to Sublease" [OC U-4 page 209]
February 22, 1983 - "Alexander Enterprises, Inc.," is registered in Pennsylvania as a corporation for purposes including but not limited to "The recruitment and search of executives and other personnel people."
March 30, 1983 - Hershey Trust Company sells former Milton Hershey School Farm # 35 to Alexander Properties, Inc AM The signatures recorded in this agreement identify William H. Alexander as President, and Steven R. Duffle as Secretary of AM
January 1984 - McNees Wallace & Nurick partner, attorney Rod J. Pera is elected to serve on the board of trustees of the Hershey Trust Company and the Board of Managers of the Milton Hershey School.
January 1985 - McNees Wallace & Nurick partner, attorney Rod J. Pera is elected to the Board of Directors of HERCO.
September 17, 1985 - Hershey Trust Company conveys an additional 169 acres of real estate to Pennsylvania State University for the recorded amount "$ 1.00" The value of the consideration is reported to be "$5,419,200." [DC Recorder of Deeds Office Book 660 page 253]
December 18, 1985 - Using the real property of former Milton Hershey School Farm # 35 as collateral, the Hershey Trust Company grants a mortgage to Alexander Properties, Inc., in the amount of $500,000. [RD Bk.700 p. 191.]
- Dauphin County Orphans' Court approves "Petition and Decree to execute a lease of Real Estate. No bond is required" [OC N/R]
- Dauphin County Orphans' Court approves "Petition and Decree for lease to execute lease of Real Estate" [OC N/R]
December 17, 1986 - Attorney Elizabeth Schreckengaust, in the service of the Office PA Attorney General, 'signs off on an 'Accounting' involving the additional transfer of assets from the Hershey Trust Company to PSU pursuant to the 'Successor Trustee' order of the Dauphin County Orphans' Court Decree #253 of 1973-127. [OC L-4 page 139./ OC M-4 page 395/ Book X- 4, page 442.]
January 1987 - Milton Hershey School & School Trust acquire 5,000,000 shares of "RBS Limited Partnership." [N/R PA Dept of State]. An entity identified as "RBS Industries, Inc.", lists their registered office c/o McNees Wallace & Nurick at 100 Pine Street, Harrisburg, PA.
January 9, 1989 - McNees Wallace & Nurick client and business associate William H. Alexander is elected to serve on the board of trustees of the Hershey Trust Company and the Board of Managers of the Milton Hershey School.
March 20, 1990 - The Milton Hershey School holds a 'Convocation' and introduces an administrative program identified as the "21st Century Initiative." Upon implementing the 'Initiative,' the Trustees execute an unidentified 'c-change' in the administration of the Deed of Trust. Two fundamental changes are evidenced in a published list of "Goals" which include "Goal A. To seek students throughout the United States and the world ... Goal F. To build and maintain a campus that will promote a sense of community and increased intellectual and social interaction... " 1 1 The 21st Century Initiative Goals: 'Goal 'A': Mr. Hershey's Deed specifies that Trustees must seek students "First 'from among the locality moving outward, and provides no authority for any search beyond the sovereign national boarders of the US. 'Goal F': In centralizing the residential campus, the Trustees have moved to increase "social interaction' ' with technology and in so doing, deprive the beneficiary of an intentional home life interaction with Nature. This move conflicts with the core purpose of the Deed of Trust that enables the beneficiary's right to this environment on the original 12,000 acres of HIS orphan farm in Derry Township, PA. 11 January 1, 1991 - McNees Wallace & Nurick Senior Managing Partner, attorney Rod J. Pera is elected as Chairman of the Hershey Trust Company and Chairman of the School's Board of Managers. Mr. Pera is also elected to the Board of Directors of Hershey Foods Corporation.
- Dauphin County Orphans' Court approves "Petition for leave to execute a lease of Real Property for a term of Ten years" [OC N/R]
- Dauphin County Orphans' Court approves "Order for leave to execute a lease of Real Property." [OC N/R]
January 1992 - R. J. Pera, W. H. Alexander, C. M. Evarts and J. C. Rowland are elected to the Board of Directors of the M.S. Hershey Foundation
- Dauphin County Orphans' Court receives a "Petition for leave to execute Shopping Center leases" d/b/a Hershey Square. [OC N/R]
August 1993 - William L. Lepley is elected President Milton Hershey School.
September 1993 - Public protest in Derry Township over the administration of the Deed of Trust provoke the official involvement of the Charitable Trust Division of PA Attorney General Ernie Preate. Chairman Pera moves to withdraw, from the Office of PA Attorney General, a proposed major modification to the Deed of Trust. This modification is purportedly 'over one inch thick' and was authored by the nationally noted 'trust busting' attorney Richard Glanton. September 1993 - Milton Hershey School President William L. Lepley is elected Chairman of the Board of Managers of the Milton Hershey School. November 20, 1993 - Hershey Trust Company transfers title to the corpus of real estate from the name of the Milton Hershey School into the Hershey Trust Company's name. In this process, all deed reference numbers have been permanently removed from the computer-generated database of the Recorder of Deeds Office in the Dauphin County Courthouse.
December 15, 1992 - Hershey Trust Company files Form 990 for the Milton Hershey School & School Trust with the IRS. The Hershey Trust Company identifies "Investment in Real Estate" reporting ownership of 10,000,000 shares of "CIIF Corp.", and 10,000,000 shares in "JMB III Endowment." The PA Department of State shows no record of either entity being registered.
April 4, 1994 - At the request of the Trustees, the former PA Attorney General Fred Speaker concludes his review of potential conflicts of interests involving Hershey Trustees. The "Speaker Report" makes recommendations for new policies.
April 7, 1994 - 'Joint RESOLUTION' is approved for "A PROGRAM TO RENEW THE GOVERNANCE OF THE MILTON HERSHEY SCHOOL" which is adopted by the Hershey Trust Company Board of Directors and the Milton Hershey School Board of Managers. In a release from the Milton Hershey School President, William L. Lepley announces the "exoneration of the boards of the School and the Trust Company from any improper behavior." He states that these new ethics standards "go beyond anything the law requires ... and Rod Pera and Bill Alexander ... will not be eligible for board membership after January 1995."
June 7, 1994 - Chairman Rod J. Pera resigns from the boards of directors of the Milton Hershey School, Hershey Trust Company and Hershey Foods Corporation, while retaining his seat as a director of HERCO.
January 1995 - Juliet Rowland is elected Chairman of the Hershey Trust Company.
April 24, 1995 - Assuming Mr. Pera's chair, William H. Alexander is elected to the Board of Directors of Hershey Foods Corporation.
December 22, 1995 - Alexander Properties, Inc., Amends the Articles of Incorporation to increase the aggregate numbers of shares from 1,000 to 150,000 among which 50,000 are preferred voting shares with a par value of $ 100 each. [PA Dept. of State/BC Book 9581 page 1068]
January 1996 - William H. Alexander is elected Chairman of the Hershey Trust Company Board of Directors.
January 1997 - William H. Alexander is elected Chairman of the Milton Hershey School Board of Managers.
July 1, 1997 - William H. Alexander is appointed to the Boards of Directors of the newly formed entities of the 'Penn State Geisinger Health System Foundation.'
April 6, 1998 - Dauphin County Orphans' Court Senior Judge Warren G. Morgan authorizes the Hershey Trustees' decision to "sell" the clinical operations of the Milton S. Hershey Medical Center to Penn State Geisinger Health Systems. In closing his opinion approving the protested "merger," Judge Morgan writes, "But in a place appropriate to those who would need to understand its meaning, there might perhaps be a small plaque with the words 'Let us not forget how all of this began."
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