Hershey (HSY) 10-K risk factor changes: FY2022 vs FY2021

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page 9 | | | [removed: ] [added: ] | | |

With respect to [removed: COVID-19,] the [added: conflict between Russia and Ukraine, the] situation remains dynamic and subject to rapid and possibly material change.

The Company’s efforts to manage and mitigate [removed: these factors] [added: any direct or indirect effects from this conflict] may ultimately be unsuccessful, and the effectiveness of these efforts depends on factors beyond our control, including the duration [removed: and severity] of [removed: any disease outbreak, as well as third-party actions taken in response.][added: the conflict and potential governmental actions.]

We have [added: been] in the past and in the future could potentially be subject to litigation or government actions as a result of issues or concerns relating to the quality and safety of our products, ingredients or packaging, human and workplace rights, and other environmental, social or governance matters, which could result in payments of fines or damages.

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- Rising levels of inflation [added: and interest rates] related to domestic and global economic conditions or supply chain issues;

- Introduction of living income premiums or similar requirements; [removed: and]

- Changes in governmental agricultural programs and energy [removed: policies.][added: policies; and]

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Our largest customer, McLane Company, Inc., accounted for approximately [removed: 30%] [added: 28%] of our total net sales in [removed: 2021.][added: 2022.]

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In [removed: 2021, 2020] [added: 2022, 2021] and [removed: 2019,] [added: 2020,] respectively, we derived approximately [removed: 13.0%, 13.6%] [added: 12.5%, 13.0%] and [removed: 15.8%] [added: 13.6%] of our net sales from customers located outside of the United States.

Additionally, approximately [removed: 19%] [added: 18%] of our total long-lived assets were located outside of the United States as of December 31, [removed: 2021.][added: 2022.]

We may not fully realize the expected [removed: costs] [added: cost] savings and/or operating efficiencies associated with our strategic initiatives or restructuring programs, which may have an adverse impact on our business.

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Political, economic and/or financial market [removed: conditions] [added: conditions, including impacts on our business arising from the conflict between Russia and Ukraine,] could negatively impact our financial results.

Volatility in food and energy costs, sustained global recessions, broad political instability, rising unemployment, pandemic outbreak of [removed: disease,] [added: disease (such as COVID-19),] climate change, weather, natural and other disasters and declines in personal spending could adversely impact our revenues, profitability and financial condition.

These processes collect, interpret and distribute business data and communicate internally and externally with employees, suppliers, customers and [removed: others.][added: other third parties.]

We are regularly the target of [removed: cyber] [added: cyber, ransomware] and other security threats.

While we have been subject to cyber [removed: attacks] [added: attacks, ransomware] and other security breaches, these incidents did not have a significant impact on our business operations.

We believe our security technology tools and processes provide adequate measures of protection against security [added: and data] breaches and in reducing cybersecurity risks.

- Pandemic outbreak of disease (such as the coronavirus disease 2019 (“COVID-19”) global pandemic);

- Other events beyond our control such as the impacts on the business or supply chain arising from the conflict between Russia and Ukraine.

Additionally, in February 2022, Russia invaded Ukraine and this conflict is still ongoing.

In response, the U.S. and other countries have imposed sanctions on Russia and may impose further sanctions that could damage or disrupt international commerce and the global economy.

The potential effects of the ongoing conflict between Russia and Ukraine may also impact many of the other risk factors described herein.

Risks Related to Macroeconomic Conditions

Our business and financial results may be negatively impacted by the failure to successfully manage a disruption in consumer and trade patterns, as well as operational challenges associated with the actual or perceived effects of a disease outbreak, including epidemics, pandemics or similar widespread public health concerns, such as the current coronavirus disease 2019 (“COVID-19”) global pandemic.

Our operations are impacted by consumer spending levels, impulse purchases, the availability of our products at retail and our ability to manufacture, store and distribute products to our customers and consumers in an effective and efficient manner.

The fear of exposure to or actual effects of a disease outbreak, epidemic, pandemic or similar widespread public health concern, such as the COVID-19 pandemic, can negatively impact our overall business and financial results.

Specific factors that may impact our operations, some of which have had an unfavorable impact on our operations as a result of COVID-19, include, but are not limited to:

- Significant reductions or volatility in demand for one or more of our products, which may be caused by, among other things: the temporary inability of consumers to purchase our products due to illness, quarantine or other travel restrictions, or financial hardship, shifts in demand away from one or more of our products, or pantry-loading activity; if prolonged, such impacts may further increase the difficulty of planning for operations and may negatively impact our results;

- Significant reductions in the availability of one or more of our products as a result of retailers, common carriers or other shippers modifying restocking, fulfillment and shipping practices;

- The inability to meet our customers’ needs and achieve cost targets due to disruptions in our manufacturing operations or supply arrangements caused by the loss or disruption of essential manufacturing and supply elements such as raw materials or finished product components, transportation resources, workforce availability, or other manufacturing and distribution capability;

- The inability to effectively manage evolving health and welfare strategies, including but not limited to ongoing or not yet fully known costs related to operational adjustments to ensure continued employee and consumer safety and adherence to health guidelines as they are modified and supplemented;

- An inability to effectively modify our trade promotion and advertising activities to reflect changing consumer viewing and shopping habits due to the cancellation or postponement of major sporting and entertainment events, reduced in-store visits, travel restrictions and a shift in customer advertising priorities, among other things;

- The failure of third parties on which we rely, including those third parties who supply our ingredients, packaging, capital equipment and other necessary operating materials, contract manufacturers, distributors, contractors, commercial banks and external business partners, to meet their obligations to the Company, or significant disruptions in their ability to do so, which may be caused by their own financial or operational difficulties and may negatively impact our operations; or

- Significant changes in the political conditions in markets in which we manufacture, sell or distribute our products, including quarantines, governmental or regulatory actions, closures or other restrictions that limit or close our operating and manufacturing facilities, restrict our employees’ ability to travel or perform necessary business functions, or otherwise prevent our third-party partners, suppliers, or customers from sufficiently

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staffing operations, including operations necessary for the production, distribution, sale, and support of our products, which could negatively impact our results.

- Pandemic outbreak of disease;

| [Table of Contents](#id42c5b9369a949b68258700b9df95f04_7) | | | The Hershey Company \| 2021 Form 10-K \| Page 15 | | |  | | |

- [Business Model and Growth [removed: Strategy](#id42c5b9369a949b68258700b9df95f04_43)][added: Strategy](#i99b894486862473eb1bc3dfcf6405c73_43)]

- [Trends Affecting Our [removed: Business](#id42c5b9369a949b68258700b9df95f04_49)][added: Business](#i99b894486862473eb1bc3dfcf6405c73_49)]

- [Consolidated Results of [removed: Operations](#id42c5b9369a949b68258700b9df95f04_52)][added: Operations](#i99b894486862473eb1bc3dfcf6405c73_52)]

- [Segment [removed: Results](#id42c5b9369a949b68258700b9df95f04_55)][added: Results](#i99b894486862473eb1bc3dfcf6405c73_55)]

- [Liquidity and Capital [removed: Resources](#id42c5b9369a949b68258700b9df95f04_58)][added: Resources](#i99b894486862473eb1bc3dfcf6405c73_58)]

- [Critical Accounting Policies and [removed: Estimates](#id42c5b9369a949b68258700b9df95f04_61)][added: Estimates](#i99b894486862473eb1bc3dfcf6405c73_61)]

We report our operations through three segments: (i) North America Confectionery, (ii) North America Salty Snacks and (iii) International, as discussed in [Note [removed: 13](#id42c5b9369a949b68258700b9df95f04_136)] [added: 13](#i99b894486862473eb1bc3dfcf6405c73_136)] to the Consolidated Financial Statements.

Our vision is to be a [added: leading] snacking powerhouse.

Seasons are an important part of our business model and for consumers, [added: as] they are highly anticipated, cherished times, centered around traditions.

Our expansion into snacking [removed: is being] [added: recently has been] fueled by the [removed: recent] acquisitions of Dot’s and Pretzels in December 2021, which [removed: is] [added: are] included in our North America Salty Snacks segment.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 21] [added: 20] | | | [removed: ] [added: ] | | |

These [removed: shorter] [added: short] and [removed: faster] [added: fast] surveys reach all of our employees around the world to hear their thoughts on the Company’s direction and their place in it.

Our gender representation includes women occupying many of the top positions in the Company, including Chief Executive Officer and Chairman of the Board, Chief Accounting Officer and [removed: Chief Growth Officer,] [added: President, Salty Snacks,] and approximately 50% representation across the Company.

In [removed: 2020,] [added: 2022,] we [removed: achieved 1:1 aggregate gender pay] [added: maintained fair] and [removed: in 2021, we achieved] [added: equitable pay achievements, including] 1:1 aggregate people of color pay equity for salaried employees in the United [removed: States.][added: States (2021) and 1:1 aggregate gender pay (2020).]

Our principal product offerings include chocolate and non-chocolate confectionery products; gum and mint refreshment products and protein bars; pantry items, such as baking ingredients, toppings and beverages; and snack items such as spreads, [removed: meat snacks, bars] [added: bars,] and snack bites and mixes, popcorn and [removed: protein bars.][added: pretzels.]

In December 2021, we completed the acquisition of [removed: Pretzels,] [added: Pretzels Inc. (“Pretzels”),] previously a privately held company that manufactures and sells pretzels and other salty snacks for other branded products and private labels in the United States.

Pretzels provides Hershey [added: with] deep pretzel category and product expertise and the manufacturing capabilities to support brand growth and future pretzel innovation.

Additionally, we completed the acquisition of [removed: Dot’s,] [added: Dot’s Pretzels, LLC (“Dot’s”),] previously a privately held company that produces and sells pretzels and other snack food products to retailers and distributors in the United States, with *Dot’s Homestyle Pretzels* snacks as its primary product.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 22] [added: 21] | | | [removed: ] [added: ] | | |

However, [removed: during 2021, continued strong demand for] [added: negative macroeconomic conditions, including inflation on inputs to] consumer [removed: goods] [added: products, labor shortages] and [removed: the effects of COVID-19 mitigation strategies] [added: demand outpacing supply,] have led to broad-based supply chain disruptions across the U.S. and [removed: globally, including inflation on many consumer products, labor shortages and demand outpacing supply.][added: globally.]

As a result, we experienced corresponding incremental costs and gross margin pressures during the year ended December 31, [removed: 2021] [added: 2022] (see [Results of [removed: Operations](#id42c5b9369a949b68258700b9df95f04_52)] [added: Operations](#i99b894486862473eb1bc3dfcf6405c73_52)] included in this MD&A).

We are [removed: working] [added: continuing to work] closely with our business units, contract manufacturers, distributors, contractors and other external business partners to minimize the potential impact on our business.

[removed: We experienced an increase in our net] [added: Net] sales and net income [added: increased] during the year ended December 31, [removed: 2021,] [added: 2022,] which was primarily driven by strong everyday performance on our core U.S. confection brands and salty snack brands (see [Segment [removed: Results](#id42c5b9369a949b68258700b9df95f04_55)] [added: Results](#i99b894486862473eb1bc3dfcf6405c73_55)] included in this MD&A), partially offset by the aforementioned supply chain disruptions and gross margin pressures.

As of December 31, [removed: 2021,] [added: 2022,] we believe we have sufficient liquidity to satisfy our key strategic initiatives and other material cash [removed: requirements;] [added: requirements in both the short-term and in the long-term;] however, we continue to evaluate and take action, as necessary, to preserve adequate liquidity and ensure that our business can operate effectively during the current economic environment.

We continue to monitor our discretionary spending across the organization (see [Liquidity and Capital [removed: Resources](#id42c5b9369a949b68258700b9df95f04_58)] [added: Resources](#i99b894486862473eb1bc3dfcf6405c73_58)] included in this MD&A).

Based on the length and severity of [removed: COVID-19, including] broad-based supply chain disruptions, [removed: rising] [added: fluctuating] levels of inflation, [removed: new trends in outbreaks and hotspots, the spread of COVID-19 variants, resurgences and the continued distribution of vaccinations, we may experience continued volatility] [added: changes] in [removed: retail foot traffic,] consumer shopping and consumption [removed: behavior] [added: behavior,] and [added: the conflict between Russia and Ukraine, we] may experience increasing supply chain costs and higher inflation.

We will continue to evaluate the nature and extent of these potential and evolving impacts [removed: to] [added: on] our business, consolidated results of operations, segment results, liquidity and capital resources.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 23] [added: 22] | | | [removed: ] [added: ] | | |

| For the years ended December 31, | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2021] [added: 2022] vs [removed: 2020] [added: 2021] | | | | | | [removed: 2020] [added: 2021] vs [removed: 2019] [added: 2020] | | |

| Net sales | | | | | | $ | [removed: 8,971.3] [added: 10,419.3] | | | | | $ | [removed: 8,149.7] [added: 8,971.3] | | | | | $ | [removed: 7,986.3] [added: 8,149.7] | | | | | [removed: 10.1] [added: 16.1] | | % | | | | [removed: 2.0] [added: 10.1] | | % |

| Cost of sales | | | | | | [removed: 4,922.7] [added: 5,920.5] | | | | | | [removed: 4,448.5] [added: 4,922.7] | | | | | | [removed: 4,363.8] [added: 4,448.5] | | | | | | [removed: 10.7] [added: 20.3] | | % | | | | [removed: 1.9] [added: 10.7] | | % |

| Gross profit | | | | | | [removed: 4,048.6] [added: 4,498.8] | | | | | | [removed: 3,701.2] [added: 4,048.6] | | | | | | [removed: 3,622.5] [added: 3,701.2] | | | | | | [removed: 9.4] [added: 11.1] | | % | | | | [removed: 2.2] [added: 9.4] | | % |

| *Gross margin* | | | | | | [removed: *45.1*] [added: *43.2*] | | *%* | | | | [removed: *45.4*] [added: *45.1*] | | *%* | | | | *45.4* | | *%* | | | | | | | | | | | | |

| SM&A expense | | | | | | [removed: 2,001.4] [added: 2,236.0] | | | | | | [removed: 1,890.9] [added: 2,001.4] | | | | | | [removed: 1,905.9] [added: 1,890.9] | | | | | | [removed: 5.8] [added: 11.7] | | % | | | | [removed: (0.8)] [added: 5.8] | | % |

| *SM&A expense as a percent of net sales* | | | | | | [removed: *22.3*] [added: *21.5*] | | *%* | | | | [removed: *23.2%*] [added: *22.3%*] | | | | | | [removed: *23.9%*] [added: *23.2%*] | | | | | | | | | | | | | | |

| Long-lived [removed: and intangible] asset impairment charges | | | | | | — | | | | | | [removed: 9.1] [added: —] | | | | | | [removed: 112.5] [added: 9.1] | | | | | | NM | | | | | | [removed: (91.9)] [added: NM] | | [removed: %] |

| Business realignment costs | | | | | | [removed: 3.5] [added: 2.0] | | | | | | [removed: 18.5] [added: 3.5] | | | | | | [removed: 8.1] [added: 18.5] | | | | | | [removed: (80.9)] [added: (43.6)] | | % | | | | [removed: 128.1] [added: (80.9)] | | % |

| Operating profit | | | | | | [removed: 2,043.7] [added: 2,260.8] | | | | | | [removed: 1,782.7] [added: 2,043.7] | | | | | | [removed: 1,596.0] [added: 1,782.7] | | | | | | [removed: 14.6] [added: 10.6] | | % | | | | [removed: 11.7] [added: 14.6] | | % |

| *Operating profit margin* | | | | | | [removed: *22.8*] [added: *21.7*] | | *%* | | | | [removed: *21.9*] [added: *22.8*] | | *%* | | | | [removed: *20.0*] [added: *21.9*] | | *%* | | | | | | | | | | | | |

| Interest expense, net | | | | | | [removed: 127.4] [added: 137.6] | | | | | | [removed: 149.4] [added: 127.4] | | | | | | [removed: 144.1] [added: 149.4] | | | | | | [removed: (14.7)] [added: 8.0] | | % | | | | [removed: 3.6] [added: (14.7)] | | % |

- [Overview](#i99b894486862473eb1bc3dfcf6405c73_46)

We utilize continuous listening surveys that are distributed throughout the year to all employees globally.

These continuous touchpoints allow for real-time feedback and action from the Company.

These surveys are further supplemented with quarterly and informative enterprise and team town halls, which, in conjunction with the continuous listening surveys, generate stronger employee engagement with the Company’s strategy, initiatives and leadership.

Demand for consumer goods has remained strong throughout 2022, with continued positive consumer patterns identified for our products, as well as increased consumer optimism and mobility, including retail foot traffic.

In addition to broad-based supply chain disruptions, certain geopolitical events, specifically the conflict between Russia and Ukraine, have increased global economic and political uncertainty.

For the year ended December 31, 2022, this conflict did not have a material impact on our commodity prices or supply availability.

However, we are continuing to monitor for any significant escalation or expansion of economic or supply chain disruptions or broader inflationary costs, which may result in material adverse effects on our results of operations.

*2022 compared with 2021*

Net sales increased 16.1% in 2022 compared with 2021, reflecting a favorable price realization of 8.0% due to higher prices on certain products, a 4.3% benefit from net acquisitions and divestitures driven by the 2021 acquisitions of Lily’s, Dot’s and Pretzels and a volume increase of 4.0% due to an increase in consumer demand primarily in everyday core U.S. confection brands and salty snack brands.

These increases were slightly offset by an unfavorable impact from foreign currency exchange rates of 0.2%.

*2022 compared with 2021*

The increase was driven by higher sales volume, higher supply chain inflation costs, including higher logistics and labor costs and an incremental $40.8 million of unfavorable mark-to-market activity on our commodity derivative instruments intended to economically hedge future years’ commodity purchases.

Gross margin decreased by 200 basis points in 2022 compared with 2021.

*2022 compared with 2021*

Selling, marketing and administrative (“SM&A”) expenses increased $234.7 million, or 11.7%, in 2022 driven by increased corporate expenses.

Total advertising and related consumer marketing expenses increased 2.7% driven by advertising increases in our confectionery brands and increased investment in our salty snacks portfolio, which were partially offset by cost efficiencies related to new media partners.

SM&A expenses, excluding advertising and related consumer marketing, increased approximately 16.3% in 2022 driven by an increase in acquisition and integration related costs, as well as higher compensation costs, investments in capabilities and technology and broad-based marketplace inflation.

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*2022 compared with 2021*

Operating profit margin decreased to 21.7% in 2022 from 22.8% in 2021 by the same factors noted above that resulted in lower gross margin for the period.

*2022 compared with 2021*

The increase was primarily due to higher rates on short-term debt balances in 2022 versus 2021, specifically related to outstanding commercial paper borrowings.

The increase was partially offset due to lower average long-term debt balances, specifically resulting from the repayment of $84.7 million of 8.800% Debentures upon their maturity in February 2021 and $350 million of 3.100% Notes upon their maturity in May 2021.

*2022 compared with 2021*

*2022 compared with 2021*

The 2021 effective rate, relative to the 21% statutory rate, benefited from investment tax credits, partially offset by incremental tax reserves incurred as a result of an adverse ruling in connection with a non-U.S. tax litigation matter, as well as state taxes.

*2022 compared with 2021*

| For the years ended December 31, | | | | | | 2022 | | | | | | 2021 | | | | | | 2020 | | | | | | 2022 vs 2021 | | | | | | 2021 vs 2020 | | |

*2022 compared with 2021*

These increases were partially offset by an unfavorable impact from foreign currency exchange rates of 0.2%.

Our net sales for licensing and owned retail increased approximately 12.7% during 2022 compared to 2021.

| For the years ended December 31, | | | | | | 2022 | | | | | | 2021 | | | | | | 2020 | | | | | | 2022 vs 2021 | | | | | | 2021 vs 2020 | | |

*2022 compared with 2021*

Our North America Salty Snacks segment income increased $59.2 million, or 58.8%, in 2022 compared to 2021, primarily due to favorable price realization and volume increases, partially offset by higher supply chain inflation costs, including higher logistics and labor costs, as well as, unfavorable product mix.

We currently, have operations and manufacture product in Mexico, Brazil, India and Malaysia, primarily for consumers in these regions, and also distribute and sell confectionery products in export markets of Latin America, as well as Asia, Europe, the Middle East and Africa (“AEMEA”) and other regions.

| For the years ended December 31, | | | | | | 2022 | | | | | | 2021 | | | | | | 2020 | | | | | | 2022 vs 2021 | | | | | | 2021 vs 2020 | | |

- [Overview](#id42c5b9369a949b68258700b9df95f04_46)

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In 2021, we changed our global employee survey from an annual basis to continuous listening surveys throughout the year.

The change from an annual survey to continuous touchpoints allows for real-time feedback and action from the Company and creates stronger employee engagement with the Company’s strategy, initiatives and leadership.

Pretzels and Dot’s are expected to generate aggregate annualized net sales over $300 million.

Lily’s is expected to generate annualized net sales over $100 million.

In September 2019, we completed the acquisition of ONE Brands, LLC (“ONE Brands”), previously a privately held company that sells a line of low-sugar, high-protein nutrition bars to retailers and distributors in the United States, with the *ONE* bar as its primary product.

On March 11, 2020, the World Health Organization designated COVID-19 as a global pandemic, which has spread worldwide and impacted various markets around the world, including the U.S. Various policies and initiatives have been implemented to reduce the global transmission of COVID-19.

Since the onset of COVID-19, there has been minimal disruption to our supply chain network.

During 2021, many state governments began easing COVID-19 restrictions, resulting in increased travel during the summer and holiday seasons, full capacity at major sporting and entertainment events, increased occupancy limits for indoor gatherings and the removal of face covering requirements (subject to certain exceptions).

This contributed to a resurgence of COVID-19 cases and the spread of COVID-19 variants, which experts believe has peaked in recent weeks in many jurisdictions.

The availability of vaccinations (including vaccine boosters) continues to increase around the world, albeit with slower than anticipated rollouts and challenges within certain countries.

*2020 compared with 2019*

Net sales increased 2.0% in 2020 compared with 2019, reflecting a favorable price realization of 2.3% due to higher prices on certain products and a 0.5% benefit from net acquisitions and divestitures (predominantly driven by the 2019 acquisition of ONE Brands, partially offset by the 2020 divestitures of Krave and the *Scharffen Berger* and *Dagoba* brands).

These increases were partially offset by an unfavorable impact from foreign currency exchange rates of 0.5% and a volume decrease of 0.3% due to the impact of COVID-19 on sales in our international markets, as well as declines in owned retail and world travel retail and elasticity-driven impacts due to price increases on certain products.

The increase in cost of sales was attributed to higher freight and logistics costs and additional plant costs, specifically, PPE costs, increased sanitation and wage incentives associated with COVID-19.

Additionally, the increase was driven by an incremental $28.9 million of unfavorable mark-to-market activity on our commodity derivative instruments.

These derivative instruments are intended to economically hedge future years’ commodity purchases; however, they were significantly impacted by financial market volatility during 2020.

Gross margin remained the same in 2020 compared with 2019.

SM&A expenses decreased $15.0 million or 0.8% in 2020.

Total advertising and related consumer marketing expenses decreased 2.0% driven by media cost efficiencies and select brand investment optimization related to COVID-19 in our International segment.

SM&A expenses, excluding advertising and related consumer marketing, decreased approximately 0.1% in 2020 due to savings in travel and meeting expenses related to COVID-19 travel restrictions and project timing shifts.

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| Customer relationship and trademark intangible assets (3) | | | | | | | | | | | | — | | | | | | 100.1 | | |

| Other long-lived assets not held for sale (4) | | | | | | | | | | | | — | | | | | | 9.7 | | |

(3)During the fourth quarter of 2019, we recorded impairment charges to write down customer relationship and trademark intangible assets associated with Krave.

These charges were determined by comparing the fair value of the asset group to its carrying value.

We used various valuation techniques to determine fair value, with the primary techniques being discounted cash flow analysis and relief-from-royalty valuation approaches, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy.

(4)During 2019, we recorded impairment charges predominantly comprised of select long-lived assets that had not yet met the held for sale criteria.

The fair value of these assets was supported by potential sales prices with third-party buyers and market analysis.

The 2019 costs related primarily to the Margin for Growth Program, a program focused on improving global efficiency and effectiveness, optimizing the Company’s supply chain, streamlining the Company’s operating model and reducing administrative expenses to generate long-term savings.

Operating profit margin increased to 21.9% in 2020 from 20.0% in 2019 driven by these same factors.

The increase was due to higher long-term debt balances in 2020 versus 2019, specifically due to $1.0 billion of notes issued in October 2019 and $1.0 billion of notes issued in May 2020.

The 2019 effective rate, relative to the 21% statutory rate, was impacted by changes to foreign valuation allowances, a favorable foreign rate differential, investment tax credits and the benefit of employee share-based payments, which were partially offset by the impact of state taxes.

Since December 31, 2014, the Company has reported its operations through two segments: (i) North America and (ii) International and Other.

After the completion of the Company’s acquisitions of Dot’s and Pretzels in December 2021, as described in [Note 2](#id42c5b9369a949b68258700b9df95f04_100) to the Consolidated Financial Statements, management of the Company has elected to begin reporting its operations through three reportable segments.

Therefore, effective in the fourth quarter of 2021, the Company realigned its former two reportable segments into three reportable segments: (i) North America Confectionery, (ii) North America Salty Snacks and (iii) International.

We have retroactively reflected these changes in all historical periods presented.

Refer to [Note [removed: 1](#id42c5b9369a949b68258700b9df95f04_97)] [added: 1](#i99b894486862473eb1bc3dfcf6405c73_97)] and [Note [removed: 5](#id42c5b9369a949b68258700b9df95f04_112)] [added: 5](#i99b894486862473eb1bc3dfcf6405c73_112)] to the Consolidated Financial Statements for further discussion of these derivative instruments and our hedging policies.

Therefore, as of December 31, [removed: 2021] [added: 2022] and December 31, [removed: 2020,] [added: 2021,] we had no interest rate swap derivative instruments in a fair value hedging relationship.

In addition, the total amount of short-term debt, net of cash, amounted to net debt of [removed: $610] [added: $230] million and net [removed: cash] [added: debt] of [removed: $1.1 billion,] [added: $610 million,] respectively, at December 31, [removed: 2021] [added: 2022] and [removed: 2020.][added: 2021.]

A hypothetical 100 basis point increase in interest rates applied to this variable-rate short-term debt as of December 31, [removed: 2021] [added: 2022] would have changed interest expense by approximately [removed: $2.4] [added: $4.5] million for [removed: 2021] [added: 2022] and [removed: $8.6] [added: $2.4] million for [removed: 2020.][added: 2021.]

A 100 basis point increase in market interest rates would decrease the fair value of our fixed-rate long-term debt at December 31, [removed: 2021] [added: 2022] and December 31, [removed: 2020] [added: 2021] by approximately [removed: $319] [added: $187] million and [removed: $357] [added: $319] million, respectively.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 43] [added: 41] | | | [removed: ] [added: ] | | |

| December 31, | | | | | | [removed: 2021] [added: 2022] | | | | | | | | | | | | [removed: 2020] [added: 2021] | | | | | | | | |

| Foreign currency forward exchange contracts to purchase foreign currencies | | | | | | $ | [removed: 53.1] [added: 58.3] | | | | | Euros Malaysian ringgit [removed: British pound] | | | | | | $ | [removed: 45.4] [added: 53.1] | | | | | Euros Malaysian ringgit [removed: Swiss Franc] [added: British pound] | | |

| Foreign currency forward exchange contracts to sell foreign currencies | | | | | | $ | [removed: 144.7] [added: 119.6] | | | | | Canadian dollars Brazilian reals Japanese yen [added: Mexican Pesos] | | | | | | $ | [removed: 178.0] [added: 144.7] | | | | | Canadian dollars Brazilian reals [removed: Mexican peso] Japanese yen [removed: British pound] | | |

At December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] the net fair value of these instruments was an asset of [removed: $2.8] [added: $3.9] million and [removed: a liability] [added: an asset] of [removed: $3.1] [added: $2.8] million, respectively.

In addition, assuming an unfavorable 10% change in year-end foreign currency exchange rates, the fair value of these instruments would have declined by [removed: $24.8] [added: $18.4] million and [removed: $25.6] [added: $24.8] million, respectively, generally offset by a reduction in foreign exchange associated with our transactional activities.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 44] [added: 42] | | | [removed: ] [added: ] | | |

Our most significant raw material requirements include cocoa products, sugar, corn products, dairy products, [added: wheat,] peanuts and almonds.

- [removed: Foreign currency exchange] [added: Currency exchanges] rates;

- Rising levels of inflation [added: and interest rates] related to domestic and global economic conditions or supply chain issues;

- Introduction of living income premiums or similar requirements; [removed: and]

- Changes in governmental agricultural programs and energy [removed: policies.][added: policies; and]

During [removed: 2021,] [added: 2022,] average cocoa futures contract prices [removed: increased 2.7%] [added: decreased 0.9%] compared with [removed: 2020] [added: 2021] and [removed: traded] [added: continued to trade] in a narrow range between [removed: $1.04] [added: $1.06] and [removed: $1.27] [added: $1.22] per pound, based on the Intercontinental Exchange futures contract.

| | | | | | | [removed: 2021] [added: 2022] | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2018] [added: 2019] | | | | | | [removed: 2017] [added: 2018] | | |

| Annual Average | | | | | | $ | [removed: 1.14] [added: 1.13] | | | | | $ | [removed: 1.11] [added: 1.14] | | | | | $ | [removed: 1.03] [added: 1.11] | | | | | $ | [removed: 1.06] [added: 1.03] | | | | | $ | [removed: 0.91] [added: 1.06] | |

| High | | | | | | [removed: 1.27] [added: 1.22] | | | | | | [removed: 1.29] [added: 1.27] | | | | | | [removed: 1.14] [added: 1.29] | | | | | | [removed: 1.23] [added: 1.14] | | | | | | [removed: 0.99] [added: 1.23] | | |

| Low | | | | | | [removed: 1.04] [added: 1.06] | | | | | | [removed: 1.00] [added: 1.04] | | | | | | [removed: 0.90] [added: 1.00] | | | | | | [removed: 0.88] [added: 0.90] | | | | | | [removed: 0.87] [added: 0.88] | | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 45] [added: 43] | | | [removed: ] [added: ] | | |

The U.S. delivered east coast refined sugar prices traded in a range from [removed: $0.45] [added: $0.53] to [removed: $0.58] [added: $0.71] per pound during [removed: 2021.][added: 2022.]

Prices were historically high throughout [removed: 2021] [added: 2022] due to lack of imports by the U.S. government resulting in an extremely tight domestic raw sugar [removed: market.][added: market and strong demand which resulted in a scarcity market for much of the year.]

Corn prices traded in a range from [removed: $4.84] [added: $5.62] to [removed: $7.32] [added: $8.25] per bushel during [removed: 2021.][added: 2022.]

During [removed: 2021] [added: 2022] prices for fluid dairy milk ranged from a low of [removed: $13.19] [added: $0.23] per pound to a high of [removed: $19.88] [added: $0.26] per pound, on a Class IV milk basis.

Fluid dairy milk prices were higher than [removed: 2020,] [added: 2021,] driven by declines in U.S. milk production and higher [added: global] dairy demand.

In [removed: 2021] [added: 2022] we [removed: began] [added: continued] utilizing soft and hard wheat futures as a risk management tool for our flour purchasing.

Hard wheat prices traded in the range of [removed: $5.62] [added: $7.72] to [removed: $8.84] [added: $13.21] per bushel during [removed: 2021,] [added: 2022,] while soft wheat prices traded in the range of [removed: $5.99] [added: $7.40] to [removed: $8.67] [added: $12.29] per bushel during [removed: 2021.][added: 2022.]

Peanut prices in the U.S. ranged from a low of [removed: $0.53] [added: $0.55] per pound to a high of [removed: $0.55] [added: $0.64] per pound during [removed: 2021.][added: 2022.]

Our open commodity derivative contracts had a notional value of [removed: $313.2] [added: $243.0] million as of December 31, [removed: 2021] [added: 2022] and [removed: $279.8] [added: $313.2] million as of December 31, [removed: 2020.][added: 2021.]

At the end of [removed: 2021,] [added: 2022,] the potential change in fair value of commodity derivative instruments, assuming a 10% decrease in the underlying commodity price, would have increased our net unrealized losses in [removed: 2021] [added: 2022] by [removed: $34.8] [added: $25.1] million, generally offset by a reduction in the cost of the underlying commodity purchases.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 46] [added: 44] | | | [removed: ] [added: ] | | |

- Other events beyond our control such as the impacts on the business or supply chain arising from the conflict between Russia and Ukraine.

Production was down significantly in Ghana by nearly 30%, while it was stable in the rest of West Africa.

As consumption remained strong, the large surplus in the 2020 - 2021 season became a small deficit in the 2022 season.

The global surplus of the 2020 - 2021 season weighed on the price outlook for the first half of 2022 and the futures market corrected to accommodate the Living Income Differential being imposed by the Ghana and Ivory Coast cocoa marketing boards, leading to fairly similar price levels to the previous year.

The conflict between Russia and Ukraine caused a tightness for global grain stocks in 2022.

Corn sweetener prices were also higher as strong demand resulted in a scarcity market during the year.

The conflict between Russia and Ukraine, in addition to poor U.S. weather, resulted in uncertainty in the wheat market and impacted global availability of supplies.

Wheat stock levels were at historic 15-year lows and prices reached historic highs in 2022.

Prices rose this year due to higher competing crop prices and a smaller peanut crop.

Almond prices traded in the range of $2.00 per pound to $2.25 per pound during 2022.

Prices were lower than 2021 as a result of large crop and high inventory levels.

Strong global production growth more than offset a firmer consumption picture with a corresponding increase in global stocks, especially in the United States.

While the global surplus weighed on the price outlook for the first half of 2021, concerns over the next main crop, owing to early pod counts and below average rainfall, underpinned prices through year-end.

A strong rebound in ethanol production, along with continued strong exports, drove prices higher in 2021.

Poor U.S. weather impacted production and resulted in lower stocks and higher prices compared to 2020.

Prices rose this year due strong demand and tight supply.

Almond prices began the year at $2.03 per pound and closed the year at $2.85 per pound during 2021.

Persistent drought and concerns over the 2021 almond crop size drove price volatility.

[removed: Therefore, effective in the fourth quarter of 2021, the] [added: The] Company [removed: realigned] [added: reports] its [removed: former two reportable segments into] [added: operations through] three [removed: reportable] segments: (i) North America Confectionery, (ii) North America Salty Snacks and (iii) International.

This [removed: new] organizational structure aligns with how our Chief Operating Decision Maker (“CODM”) manages our business, including resource allocation and performance assessment, and further aligns with our product categories and the key markets we serve.

This includes [added: our business in] chocolate and non-chocolate confectionery, gum and refreshment products, protein bars, spreads, snack bites and mixes, as well as pantry and food service lines.

Financial and other information regarding our [removed: reportable] segments is provided in our Management’s Discussion and Analysis and [Note [removed: 13](#id42c5b9369a949b68258700b9df95f04_136)] [added: 13](#i99b894486862473eb1bc3dfcf6405c73_136)] to the Consolidated Financial Statements.

In December 2021, we completed the acquisition of [removed: Pretzels,] [added: Pretzels Inc. (“Pretzels”),] previously a privately held company that manufactures and sells pretzels and other salty snacks for other branded products and private labels in the United States.

[removed: Additionally,] [added: Additionally in December 2021,] we completed the acquisition of [removed: Dot’s,] [added: Dot’s Pretzels, LLC (“Dot’s”),] previously a privately held company that produces and sells pretzels and other snack food products to retailers and distributors in the United States, with *Dot’s Homestyle Pretzels* snacks as its primary product.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page 2 | | | [removed: ] [added: ] | | |

In [removed: 2021,] [added: 2022,] approximately [removed: 30%] [added: 28%] of our consolidated net sales were made to McLane Company, Inc., one of the largest wholesale distributors in the United States (“U.S.”) to convenience stores, drug stores, wholesale clubs and mass merchandisers and the primary distributor of our products to Wal-Mart Stores, Inc.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page 3 | | | [removed: ] [added: ] | | |

Many of our confectionery [added: and salty snack] brands enjoy wide consumer acceptance and are among the leading brands sold in the marketplace in North America and certain international markets.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page 4 | | | [removed: ] [added: ] | | |

| Cadbury UK Limited | | | | | | *Cadbury Caramello* | | | | | | United States | | | | | | Minimum sales requirement exceeded in [removed: 2021] [added: 2022] | | |

| Société des Produits Nestlé SA | | | | | | *Kit Kat®* *Rolo®* | | | | | | United States | | | | | | Minimum unit volume sales exceeded in [removed: 2021] [added: 2022] | | |

Information concerning our research and development expense is contained in [Note [removed: 1](#id42c5b9369a949b68258700b9df95f04_97)] [added: 1](#i99b894486862473eb1bc3dfcf6405c73_97)] to the Consolidated Financial Statements.

In the [removed: United States,] [added: U.S.,] our activities are subject to regulation by various government agencies, including the Food and Drug Administration, the Department of Agriculture, the Federal Trade Commission, the Department of Commerce and the Environmental Protection Agency, as well as various state and local agencies.

Similar agencies also regulate our businesses outside of the [removed: United States.][added: U.S.]

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page 5 | | | [removed: ] [added: ] | | |

[added: We] identify risks and establish controls intended to ensure product quality and safety.

Various government agencies and third-party [removed: firms] [added: firms,] as well as our quality assurance [removed: staff] [added: staff,] conduct audits of all facilities that manufacture our products to assure effectiveness and compliance with our program and applicable laws and regulations.

Beyond ordinary [removed: course] operating and capital expenditures [added: that] we make to comply with government regulations, including environmental laws and regulations, we have made a number of voluntary commitments to protect and reduce our environmental impacts in recent years, including efforts to eliminate [added: commodity-driven] deforestation and reduce greenhouse gas (“GHG”) emissions across our [added: own operations and] supply chain.

Our climate change related investments and expenditures primarily focus on achieving a 50% absolute reduction in our Scope 1 and 2 GHG emissions and a 25% absolute reduction in our Scope 3 GHG emissions by 2030 (compared to a 2018 baseline), as well as having 100% of plastic packaging be [removed: reusable, recyclable] [added: recyclable, reusable] or compostable and 25 million pounds of packaging be eliminated by 2030.

To learn more about our [removed: sustainability] [added: ESG-related] goals, progress and initiatives, as well as review our annual ESG Report [removed: (formerly known as our Sustainability Report)] and accompanying suite of ESG reporting frameworks, policies, and disclosures, access the Sustainability section of our website at: https://www.thehersheycompany.com/en_us/sustainability.html.

The percentage of total consolidated net sales for our businesses outside of the United States was [removed: 13.0%] [added: 12.5%] for [removed: 2021, 13.6%] [added: 2022, 13.0%] for [removed: 2020] [added: 2021] and [removed: 15.8%] [added: 13.6%] for [removed: 2019.][added: 2020.]

The percentage of total long-lived assets outside of the United States was [removed: 18.8%] [added: 17.9%] as of December 31, [removed: 2021] [added: 2022] and [removed: 19.7%] [added: 18.8%] as of December 31, [removed: 2020.][added: 2021.]

As of December 31, [removed: 2021,] [added: 2022,] the Company employed approximately [removed: 16,620] [added: 18,075] full-time and [removed: 2,370] [added: 1,790] part-time employees worldwide.

Collective bargaining agreements covered approximately [removed: 6,235] [added: 6,470] employees, or approximately 33% of the Company’s employees worldwide.

During [removed: 2022,] [added: 2023,] agreements are expected to be negotiated for certain employees at [added: five facilities,] four [removed: facilities] [added: of which are] outside of the United States, comprising approximately [removed: 62%] [added: 67%] of total employees under collective bargaining agreements.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page 6 | | | [removed: ] [added: ] | | |

[added: These short and fast surveys reach all of our] employees around the world to hear their thoughts on the Company’s direction and their place in it.

[removed: The change from an annual survey to] [added: These] continuous touchpoints [removed: allows] [added: allow] for real-time feedback and action from the Company.

[removed: These surveys are further supplemented with quarterly and] informative enterprise and team town halls, which, in conjunction with the continuous listening surveys, generate stronger employee engagement with the Company’s strategy, initiatives and leadership.

Through individual development plans, learning opportunities, feedback and coaching, employees can build careers at The Hershey Company, as evidenced by the fact that the majority of our eight executive officers were promoted from within the organization (see [removed: [Information](#id42c5b9369a949b68258700b9df95f04_31) [a](#id42c5b9369a949b68258700b9df95f04_31)[bout] [added: [Information about] Our Executive [removed: Officers](#id42c5b9369a949b68258700b9df95f04_31)).][added: Officers](#i99b894486862473eb1bc3dfcf6405c73_31)).]

Additionally, [removed: in 2021, we introduced] the [added: Company offers a] “Best of Both” flexible work model for corporate and commercial employees to balance work and personal well-being.

Our diverse and inclusive culture makes the difference across all areas of the [removed: business.][added: business around the world.]

Our gender representation includes women occupying many of the top positions in the Company, including Chief Executive Officer and Chairman of the Board, Chief Accounting Officer and [removed: Chief Growth Officer,] [added: President, Salty Snacks,] and approximately 50% representation across the Company.

In [removed: 2020,] [added: 2022,] we [removed: achieved 1:1 aggregate gender pay] [added: maintained fair] and [removed: in 2021, we achieved] [added: equitable pay achievements, including] 1:1 aggregate people of color pay equity for salaried employees in the United [removed: States.][added: States (2021) and 1:1 aggregate gender pay (2020).]

Additionally, five of our 12 Board members are women (42% [removed: representation, an increase of 6% compared to 2020).][added: representation).]

[removed: Our] [added: Further, our] eight employee-led Business Resource Groups, which include Abilities First, African American, Asian, GenH (Generations), Latino, Prism (LGBTQ), Veteran’s and Women’s, play a critical role in attracting diverse talent, providing mentoring and career development opportunities, delivering commercial business insights and connecting people to the Company and the communities where we do business.

In [removed: 2021,] [added: 2022,] the Company was ranked [removed: #10] [added: #6] on DiversityInc’s Top 50 Companies for Diversity and was ranked [removed: #1] [added: as a top 50 company] on Forbes Top Female Friendly Companies.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page 7 | | | [removed: ] [added: ] | | |

Total proceeds from the divestitures and the impact on our Consolidated Statements of Income, both individually and on an aggregate basis, were immaterial.

Depending on the country, trademarks remain valid for as long as they are in use or their registration status is maintained.

Trademark registrations generally are renewable for fixed terms.

Information found on the Company’s website is not part of this Annual Report on Form 10-K or any other report filed with the United States Securities and Exchange Commission (“SEC”).

Additionally, continuous listening surveys are distributed throughout the year to all employees globally.

These surveys are further supplemented with quarterly and

Further, in June 2022, the Company conducted its first annual Ethics and Compliance Survey to assess employees’ perception of the health of ethics and compliance at Hershey.

Additionally, the Company also ranked as a top 30 company on Wall Street Journal’s Top 250 Best-Managed Companies of 2022.

Since December 31, 2014, the Company has reported its operations through two segments: (i) North America and (ii) International and Other.

After the completion of the Company’s acquisitions of Dot’s Pretzels, LLC (“Dot’s”) and Pretzels Inc. (“Pretzels”) in December 2021, as described in [Note 2](#id42c5b9369a949b68258700b9df95f04_100) to the Consolidated Financial Statements, management of the Company has elected to begin reporting its operations through three reportable segments.

We have retroactively reflected these changes in all historical periods presented.

Pretzels and Dot’s are expected to generate aggregate annualized net sales over $300 million.

Lily’s is expected to generate annualized net sales over $100 million.

In September 2019, we completed the acquisition of ONE Brands, LLC (“ONE Brands”), previously a privately held company that sells a line of low-sugar, high-protein nutrition bars to retailers and distributors in the United States, with the *ONE* bar as its primary product.

We

Additionally, in 2021, we changed our global employee survey from an annual basis to continuous listening surveys throughout the year.

These shorter and faster surveys reach all of our

Additionally, we create a welcoming and inclusive work environment for all employees around the world.

Information on legal proceedings is included in [Note [removed: 15](#id42c5b9369a949b68258700b9df95f04_145)] [added: 15](#i99b894486862473eb1bc3dfcf6405c73_145)] to the Consolidated Financial Statements.

For the fiscal year ended December 31, [removed: 2021][added: 2022]

[removed: ][added: ]

As of July [removed: 2, 2021] [added: 1, 2022] (the last business day of the registrant’s most recently completed second fiscal quarter), the aggregate market value of the voting and non-voting common equity held by non-affiliates was [removed: $25,257,103,284.][added: $32,207,985,953.]

Determination of aggregate market value assumes all outstanding shares of Class B Common Stock held by non-affiliates were converted to Common Stock as of July [removed: 2, 2021.][added: 1, 2022.]

The market value indicated is calculated based on the closing price of the Common Stock on the New York Stock Exchange on July [removed: 2, 2021 ($174.00] [added: 1, 2022 ($221.00] per share).

Common Stock, one dollar par [removed: value—145,628,076] [added: value—146,922,179] shares, as of February [removed: 16, 2022.][added: 15, 2023.]

Class B Common Stock, one dollar par [removed: value—59,613,777] [added: value—57,113,777] shares, as of February [removed: 16, 2022.][added: 15, 2023.]

Portions of the Company’s Proxy Statement for the [removed: 2022] [added: 2023] Annual Meeting of Stockholders are incorporated by reference into Part III of this Annual Report on Form 10-K.

| [Item [removed: 1.](#id42c5b9369a949b68258700b9df95f04_13)] [added: 1.](#i99b894486862473eb1bc3dfcf6405c73_13)] | | | | | | [removed: [Business](#id42c5b9369a949b68258700b9df95f04_13)] [added: [Business](#i99b894486862473eb1bc3dfcf6405c73_13)] | | | | | | [removed: [2](#id42c5b9369a949b68258700b9df95f04_13)] [added: [2](#i99b894486862473eb1bc3dfcf6405c73_13)] | | |

| [Item [removed: 1A.](#id42c5b9369a949b68258700b9df95f04_16)] [added: 1A.](#i99b894486862473eb1bc3dfcf6405c73_16)] | | | | | | [Risk [removed: Factors](#id42c5b9369a949b68258700b9df95f04_16)] [added: Factors](#i99b894486862473eb1bc3dfcf6405c73_16)] | | | | | | [removed: [9](#id42c5b9369a949b68258700b9df95f04_16)] [added: [9](#i99b894486862473eb1bc3dfcf6405c73_16)] | | |

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| | | | | | | [Schedule II—Valuation and Qualifying [removed: Accounts](#id42c5b9369a949b68258700b9df95f04_199)] [added: Accounts](#i99b894486862473eb1bc3dfcf6405c73_196)] | | | | | | [removed: [110](#id42c5b9369a949b68258700b9df95f04_199)] [added: [104](#i99b894486862473eb1bc3dfcf6405c73_196)] | | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page 1 | | | [removed: ] [added: ] | | |

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to § 240.10D-1(b).

For the Fiscal Year Ended December 31, 2022

| | | | | | | [Signatures](#i99b894486862473eb1bc3dfcf6405c73_193) | | | | | | [103](#i99b894486862473eb1bc3dfcf6405c73_193) | | |

| | | | | | | [Signatures](#id42c5b9369a949b68258700b9df95f04_196) | | | | | | [109](#id42c5b9369a949b68258700b9df95f04_196) | | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 16] [added: 15] | | | [removed: ] [added: ] | | |

As discussed in [Note [removed: 13](#id42c5b9369a949b68258700b9df95f04_136)] [added: 13](#i99b894486862473eb1bc3dfcf6405c73_136)] to the Consolidated Financial Statements, we do not manage our assets on a segment basis given the integration of certain manufacturing, warehousing, distribution and other activities in support of our global operations.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 17] [added: 16] | | | [removed: ] [added: ] | | |

The executive officers of the Company, their positions and, as of February [removed: 16, 2022,] [added: 15, 2023,] their ages are set forth below.

| Michele G. Buck | | | | | | [removed: 60] [added: 61] | | | | | | Chairman of the Board, President and Chief Executive Officer (October 2019); President and Chief Executive Officer (March [removed: 2017); Executive Vice President, Chief Operating Officer (June 2016)] [added: 2017)] | | |

| Jennifer L. McCalman (1) | | | | | | [removed: 44] [added: 45] | | | | | | Vice President, Chief Accounting Officer (February 2021); Senior Director, Global Controller (March 2019) | | |

| Charles R. Raup | | | | | | [removed: 54] [added: 55] | | | | | | President, U.S. [added: Confection (November 2022); President, U.S.] (January 2020); Vice President, U.S. CMG (June 2018); Vice President and General Manager, Chocolate (August [removed: 2017); Vice President and General Manager, Mexico (October 2015)] [added: 2017)] | | |

| Jason R. Reiman | | | | | | [removed: 50] [added: 51] | | | | | | Senior Vice President, Chief Supply Chain Officer (June 2019); Vice President, Supply Chain Operations (August 2018); Vice President, US Supply Chain Operations (July 2017); Vice President, International Operations (May [removed: 2017); Vice President, AEMA Supply Chain Operations (October 2015)] [added: 2017)] | | |

| Kristen J. Riggs | | | | | | [removed: 43] [added: 44] | | | | | | [added: President, Salty Snacks (November 2022);] Senior Vice President, Chief Growth Officer (January 2020); Vice President, Innovation and Strategic Growth Platforms (September 2019); Vice President, Commercial Planning (June 2018); Vice President, Brand Commercialization (July [removed: 2017); Senior Director, Reese’s (October 2015)] [added: 2017)] | | |

| Christopher M. Scalia | | | | | | [removed: 46] [added: 47] | | | | | | Senior Vice President, Chief Human Resources Officer (January 2020); Vice President, Global Human Resources (March 2018); Vice President, Talent, HR Operations and Analytics (December 2014) | | |

| James Turoff | | | | | | [removed: 45] [added: 46] | | | | | | Senior Vice President, General Counsel and Secretary (May 2021); Acting General Counsel (December 2020); Vice President, Deputy General Counsel (March 2019); Vice President, SEC, Corporate Governance & Compliance (March 2018); Associate General Counsel, Securities & Governance and Business Transformation (May [removed: 2017); Associate General Counsel, AEMEA and Securities & Governance (October 2015)] [added: 2017)] | | |

| Steven E. Voskuil (2) | | | | | | [removed: 53] [added: 54] | | | | | | Senior Vice President, Chief Financial Officer (February 2021); Senior Vice President, Chief Financial Officer and Chief Accounting Officer (November 2019); Senior Vice President, Chief Financial Officer (May 2019) | | |

Prior to joining our Company she was Senior [removed: Director,] [added: Director and] Assistant [removed: Corporate] Controller for Keurig Dr. Pepper (formerly Keurig Green Mountain) (May [removed: 2017) and Director, Assistant Corporate Controller (December 2011).][added: 2017).]

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 18] [added: 17] | | | [removed: ] [added: ] | | |

The closing price of our Common Stock on December [removed: 31, 2021,] [added: 30, 2022 (the last business day of the of the fiscal year)] was [removed: $193.47.][added: $231.57.]

There were [removed: 24,619] [added: 24,076] stockholders of record of our Common Stock and [removed: 6] [added: 5] stockholders of record of our Class B Stock as of December 31, [removed: 2021.][added: 2022.]

We paid [removed: $686.0] [added: $775.0] million in cash dividends on our Common Stock and Class B Stock in [removed: 2021] [added: 2022] and [removed: $640.7] [added: $686.0] million in [removed: 2020.][added: 2021.]

The annual dividend rate on our Common Stock in [removed: 2021] [added: 2022] was [removed: $3.410] [added: $3.874] per share.

On [removed: February 2, 2022,] [added: January 31, 2023,] our Board declared a quarterly dividend of [removed: $0.901] [added: $1.036] per share of Common Stock payable on March 15, [removed: 2022,] [added: 2023,] to stockholders of record as of February [removed: 18, 2022.][added: 17, 2023.]

It is the Company’s [removed: 369th] [added: 373rd] consecutive quarterly Common Stock dividend.

A quarterly dividend of [removed: $0.819] [added: $0.942] per share of Class B Stock also was declared.

[removed: There were no] [added: The following table shows the] purchases of shares of Common Stock made by or on behalf of Hershey, or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934, as amended) of Hershey, for each fiscal month in the three months ended December 31, [removed: 2021.][added: 2022:]

[added: (2)] In July 2018, our Board of Directors approved a $500 million share repurchase authorization.

As of December 31, [removed: 2021,] [added: 2022,] approximately $110 million remained available for repurchases of our Common Stock under this program.

[removed: The] [added: These] share repurchase [removed: program does] [added: programs do] not have an expiration date.

In February 2022, the Company entered into a Stock Purchase Agreement with Hershey Trust Company, as trustee for the [added: School] Trust, pursuant to which the Company purchased 1,000,000 shares of the Company’s Common Stock from the [added: School] Trust at a price equal to $203.35 per share, for a total purchase price of $203.4 million.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 19] [added: 18] | | | [removed: ] [added: ] | | |

The following graph compares our cumulative total stockholder return (Common Stock price appreciation plus dividends, on a reinvested basis) over the last five fiscal years with the Standard & Poor’s 500 Index and the Standard & Poor’s [added: 500] Packaged Foods Index.

and the S&P [added: 500] Packaged Foods Index

[removed: ][added: ]

*$100 invested on December 31, [removed: 2016] [added: 2017] in stock or index, [removed: including] [added: assuming] reinvestment of dividends.

| Company/Index | | | | | | [removed: 2016] [added: 2017] | | | | | | [removed: 2017] [added: 2018] | | | | | | [removed: 2018] [added: 2019] | | | | | | [removed: 2019] [added: 2020] | | | | | | [removed: 2020] [added: 2021] | | | | | | [removed: 2021] [added: 2022] | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Period | | | | | | Total Number of Shares Purchased (1) | | | | | | Average Price Paid per Share | | | | | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (2) | | | | | | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) | | |

| | | | | | | | | | | | | | | | | | | | | | | | | (in thousands of dollars) | | |

| October 3 through October 30 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 609,983 | |

| October 31 through November 27 | | | | | | 145,701 | | | | | | $ | 231.25 | | | | | — | | | | | | $ | 609,983 | |

| November 28 through December 31 | | | | | | — | | | | | | $ | — | | | | | — | | | | | | $ | 609,983 | |

| Total | | | | | | 145,701 | | | | | | $ | — | | | | | — | | | | | | | | |

(1) During the three months ended December 31, 2022, 145,701 shares of Common Stock were purchased in open market transactions in connection with our standing authorization to buy back shares sufficient to offset those issued under incentive compensation plans, which authorization does not have a dollar or share limit and is not included in our share repurchase authorizations described in the following note (2).

In February 2023, the Company entered into a Stock Purchase Agreement with Hershey Trust Company, as trustee for the Milton Hershey School Trust (the “School Trust”), pursuant to which the Company purchased 1,000,000 shares of the Company’s Common Stock from the School Trust at a price equal to $239.91 per share, for a total purchase price of $239.9 million.

As a result of this repurchase, our July 2018 share repurchase authorization program was completed in February 2023, and approximately $370 million remains available for repurchases under our May 2021 share repurchase authorization.

| The Hershey Company | | | | | | $ | 100 | | | | | $ | 97 | | | | | $ | 136 | | | | | $ | 144 | | | | | $ | 187 | | | | | $ | 228 | |

| S&P 500 Index | | | | | | $ | 100 | | | | | $ | 96 | | | | | $ | 126 | | | | | $ | 149 | | | | | $ | 191 | | | | | $ | 157 | |

| S&P 500 Packaged Foods Index | | | | | | $ | 100 | | | | | $ | 81 | | | | | $ | 106 | | | | | $ | 111 | | | | | $ | 126 | | | | | $ | 137 | |

| The Hershey Company | | | | | | $ | 100 | | | | | $ | 112 | | | | | $ | 109 | | | | | $ | 153 | | | | | $ | 162 | | | | | $ | 210 | |

| S&P 500 Index | | | | | | $ | 100 | | | | | $ | 122 | | | | | $ | 116 | | | | | $ | 153 | | | | | $ | 181 | | | | | $ | 233 | |

| S&P 500 Packaged Foods Index | | | | | | $ | 100 | | | | | $ | 101 | | | | | $ | 82 | | | | | $ | 108 | | | | | $ | 113 | | | | | $ | 127 | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 20] [added: 19] | | | [removed: ] [added: ] | | |

| [Report of Independent Registered Public Accounting Firm (PCAOB [removed: ID:](#id42c5b9369a949b68258700b9df95f04_70) 42[)](#id42c5b9369a949b68258700b9df95f04_70)] [added: ID:](#i99b894486862473eb1bc3dfcf6405c73_70) 42[)](#i99b894486862473eb1bc3dfcf6405c73_70)] | | | | | | [removed: [48](#id42c5b9369a949b68258700b9df95f04_70)] [added: [46](#i99b894486862473eb1bc3dfcf6405c73_70)] | | |

| [Report of Independent Registered Public Accounting Firm on Internal Control Over Financial [removed: Reporting](#id42c5b9369a949b68258700b9df95f04_73)] [added: Reporting](#i99b894486862473eb1bc3dfcf6405c73_73)] | | | | | | [removed: [51](#id42c5b9369a949b68258700b9df95f04_73)] [added: [48](#i99b894486862473eb1bc3dfcf6405c73_73)] | | |

| [Consolidated Statements of Income for the years ended December [removed: 31](#id42c5b9369a949b68258700b9df95f04_76)[,](#id42c5b9369a949b68258700b9df95f04_76) [2021,](#id42c5b9369a949b68258700b9df95f04_76) [2020](#id42c5b9369a949b68258700b9df95f04_76) [and](#id42c5b9369a949b68258700b9df95f04_76) [2019](#id42c5b9369a949b68258700b9df95f04_76)] [added: 31, 202](#i99b894486862473eb1bc3dfcf6405c73_76)[2](#i99b894486862473eb1bc3dfcf6405c73_76)[, 202](#i99b894486862473eb1bc3dfcf6405c73_76)[1](#i99b894486862473eb1bc3dfcf6405c73_76) [and 20](#i99b894486862473eb1bc3dfcf6405c73_76)[20](#i99b894486862473eb1bc3dfcf6405c73_76)] | | | | | | [removed: [53](#id42c5b9369a949b68258700b9df95f04_76)] [added: [50](#i99b894486862473eb1bc3dfcf6405c73_76)] | | |

| [Consolidated Statements of Comprehensive Income for the years ended December [removed: 31,](#id42c5b9369a949b68258700b9df95f04_79) [2021, 2020 and 2019](#id42c5b9369a949b68258700b9df95f04_76)] [added: 31,](#i99b894486862473eb1bc3dfcf6405c73_79) [202](#i99b894486862473eb1bc3dfcf6405c73_76)[2](#i99b894486862473eb1bc3dfcf6405c73_76)[, 202](#i99b894486862473eb1bc3dfcf6405c73_76)[1](#i99b894486862473eb1bc3dfcf6405c73_76) [and 20](#i99b894486862473eb1bc3dfcf6405c73_76)[20](#i99b894486862473eb1bc3dfcf6405c73_76)] | | | | | | [removed: [54](#id42c5b9369a949b68258700b9df95f04_79)] [added: [51](#i99b894486862473eb1bc3dfcf6405c73_79)] | | |

| [Consolidated Balance Sheets as of December 31, [removed: 202](#id42c5b9369a949b68258700b9df95f04_82)[1](#id42c5b9369a949b68258700b9df95f04_82) [and](#id42c5b9369a949b68258700b9df95f04_82) [20](#id42c5b9369a949b68258700b9df95f04_82)[20](#id42c5b9369a949b68258700b9df95f04_82)] [added: 202](#i99b894486862473eb1bc3dfcf6405c73_82)[2](#i99b894486862473eb1bc3dfcf6405c73_82) [and 202](#i99b894486862473eb1bc3dfcf6405c73_82)[1](#i99b894486862473eb1bc3dfcf6405c73_82)] | | | | | | [removed: [55](#id42c5b9369a949b68258700b9df95f04_82)] [added: [52](#i99b894486862473eb1bc3dfcf6405c73_82)] | | |

| [Consolidated Statements of Cash Flows for the years ended December [removed: 31,](#id42c5b9369a949b68258700b9df95f04_88) [2021, 2020 and 2019](#id42c5b9369a949b68258700b9df95f04_76)] [added: 31,](#i99b894486862473eb1bc3dfcf6405c73_88) [202](#i99b894486862473eb1bc3dfcf6405c73_76)[2](#i99b894486862473eb1bc3dfcf6405c73_76)[, 202](#i99b894486862473eb1bc3dfcf6405c73_76)[1](#i99b894486862473eb1bc3dfcf6405c73_76) [and 20](#i99b894486862473eb1bc3dfcf6405c73_76)[2](#i99b894486862473eb1bc3dfcf6405c73_76)[0](#i99b894486862473eb1bc3dfcf6405c73_76)] | | | | | | [removed: [56](#id42c5b9369a949b68258700b9df95f04_88)] [added: [53](#i99b894486862473eb1bc3dfcf6405c73_88)] | | |

| [Consolidated Statements of Stockholders’ Equity for the years ended December [removed: 31,](#id42c5b9369a949b68258700b9df95f04_91) [2021, 2020 and 2019](#id42c5b9369a949b68258700b9df95f04_76)] [added: 31,](#i99b894486862473eb1bc3dfcf6405c73_91) [20](#i99b894486862473eb1bc3dfcf6405c73_76)[2](#i99b894486862473eb1bc3dfcf6405c73_76)[2](#i99b894486862473eb1bc3dfcf6405c73_76)[, 202](#i99b894486862473eb1bc3dfcf6405c73_76)[1](#i99b894486862473eb1bc3dfcf6405c73_76) [and 20](#i99b894486862473eb1bc3dfcf6405c73_76)[20](#i99b894486862473eb1bc3dfcf6405c73_76)] | | | | | | [removed: [57](#id42c5b9369a949b68258700b9df95f04_91)] [added: [54](#i99b894486862473eb1bc3dfcf6405c73_91)] | | |

| [Notes to Consolidated Financial [removed: Statements](#id42c5b9369a949b68258700b9df95f04_94)] [added: Statements](#i99b894486862473eb1bc3dfcf6405c73_94)] | | | | | | [removed: [58](#id42c5b9369a949b68258700b9df95f04_94)] [added: [55](#i99b894486862473eb1bc3dfcf6405c73_94)] | | |

| [Note 1 - Summary of Significant Accounting [removed: Policies](#id42c5b9369a949b68258700b9df95f04_97)] [added: Policies](#i99b894486862473eb1bc3dfcf6405c73_97)] | | | | | | [removed: [58](#id42c5b9369a949b68258700b9df95f04_97)] [added: [55](#i99b894486862473eb1bc3dfcf6405c73_97)] | | |

| [Note 2 - Business Acquisitions and [removed: Divestitures](#id42c5b9369a949b68258700b9df95f04_100)] [added: Divestitures](#i99b894486862473eb1bc3dfcf6405c73_100)] | | | | | | [removed: [64](#id42c5b9369a949b68258700b9df95f04_100)] [added: [60](#i99b894486862473eb1bc3dfcf6405c73_100)] | | |

| [Note 3 - Goodwill and Intangible [removed: Assets](#id42c5b9369a949b68258700b9df95f04_103)] [added: Assets](#i99b894486862473eb1bc3dfcf6405c73_103)] | | | | | | [removed: [68](#id42c5b9369a949b68258700b9df95f04_103)] [added: [64](#i99b894486862473eb1bc3dfcf6405c73_103)] | | |

| [Note 4 - Short and Long-Term [removed: Debt](#id42c5b9369a949b68258700b9df95f04_106)] [added: Debt](#i99b894486862473eb1bc3dfcf6405c73_106)] | | | | | | [removed: [69](#id42c5b9369a949b68258700b9df95f04_106)] [added: [64](#i99b894486862473eb1bc3dfcf6405c73_106)] | | |

| [Note 5 - Derivative [removed: Instruments](#id42c5b9369a949b68258700b9df95f04_112)] [added: Instruments](#i99b894486862473eb1bc3dfcf6405c73_112)] | | | | | | [removed: [71](#id42c5b9369a949b68258700b9df95f04_112)] [added: [66](#i99b894486862473eb1bc3dfcf6405c73_112)] | | |

| [Note 6 - Fair Value [removed: Measurements](#id42c5b9369a949b68258700b9df95f04_115)] [added: Measurements](#i99b894486862473eb1bc3dfcf6405c73_115)] | | | | | | [removed: [73](#id42c5b9369a949b68258700b9df95f04_115)] [added: [68](#i99b894486862473eb1bc3dfcf6405c73_115)] | | |

| [Note 7 - [removed: Leases](#id42c5b9369a949b68258700b9df95f04_118)] [added: Leases](#i99b894486862473eb1bc3dfcf6405c73_118)] | | | | | | [removed: [76](#id42c5b9369a949b68258700b9df95f04_118)] [added: [70](#i99b894486862473eb1bc3dfcf6405c73_118)] | | |

| [Note 8 - Investments in Unconsolidated [removed: Affiliates](#id42c5b9369a949b68258700b9df95f04_121)] [added: Affiliates](#i99b894486862473eb1bc3dfcf6405c73_121)] | | | | | | [removed: [78](#id42c5b9369a949b68258700b9df95f04_121)] [added: [72](#i99b894486862473eb1bc3dfcf6405c73_121)] | | |

| [Note 9 - Business Realignment [removed: Activities](#id42c5b9369a949b68258700b9df95f04_124)] [added: Activities](#i99b894486862473eb1bc3dfcf6405c73_124)] | | | | | | [removed: [78](#id42c5b9369a949b68258700b9df95f04_124)] [added: [72](#i99b894486862473eb1bc3dfcf6405c73_124)] | | |

| [Note 10 - Income [removed: Taxes](#id42c5b9369a949b68258700b9df95f04_127)] [added: Taxes](#i99b894486862473eb1bc3dfcf6405c73_127)] | | | | | | [removed: [80](#id42c5b9369a949b68258700b9df95f04_127)] [added: [74](#i99b894486862473eb1bc3dfcf6405c73_127)] | | |

| [Note 11 - Pension and Other Post-Retirement Benefit [removed: Plans](#id42c5b9369a949b68258700b9df95f04_130)] [added: Plans](#i99b894486862473eb1bc3dfcf6405c73_130)] | | | | | | [removed: [83](#id42c5b9369a949b68258700b9df95f04_130)] [added: [77](#i99b894486862473eb1bc3dfcf6405c73_130)] | | |

| [Note 12 - Stock Compensation [removed: Plans](#id42c5b9369a949b68258700b9df95f04_133)] [added: Plans](#i99b894486862473eb1bc3dfcf6405c73_133)] | | | | | | [removed: [89](#id42c5b9369a949b68258700b9df95f04_133)] [added: [83](#i99b894486862473eb1bc3dfcf6405c73_133)] | | |

| [Note 13 - Segment [removed: Information](#id42c5b9369a949b68258700b9df95f04_136)] [added: Information](#i99b894486862473eb1bc3dfcf6405c73_136)] | | | | | | [removed: [92](#id42c5b9369a949b68258700b9df95f04_136)] [added: [86](#i99b894486862473eb1bc3dfcf6405c73_136)] | | |

| [Note 15 - Commitments and [removed: Contingencies](#id42c5b9369a949b68258700b9df95f04_145)] [added: Contingencies](#i99b894486862473eb1bc3dfcf6405c73_145)] | | | | | | [removed: [96](#id42c5b9369a949b68258700b9df95f04_145)] [added: [90](#i99b894486862473eb1bc3dfcf6405c73_145)] | | |

| [Note 16 - Earnings Per [removed: Share](#id42c5b9369a949b68258700b9df95f04_148)] [added: Share](#i99b894486862473eb1bc3dfcf6405c73_148)] | | | | | | [removed: [97](#id42c5b9369a949b68258700b9df95f04_148)] [added: [91](#i99b894486862473eb1bc3dfcf6405c73_148)] | | |

| [Note 17 - Other (Income) Expense, [removed: Net](#id42c5b9369a949b68258700b9df95f04_151)] [added: Net](#i99b894486862473eb1bc3dfcf6405c73_151)] | | | | | | [removed: [99](#id42c5b9369a949b68258700b9df95f04_151)] [added: [93](#i99b894486862473eb1bc3dfcf6405c73_151)] | | |

| [Note [removed: 18 -] [added: 1](#i99b894486862473eb1bc3dfcf6405c73_154)[9](#i99b894486862473eb1bc3dfcf6405c73_154) [-] Supplemental Balance Sheet [removed: Information](#id42c5b9369a949b68258700b9df95f04_154)] [added: Information](#i99b894486862473eb1bc3dfcf6405c73_154)] | | | | | | [removed: [100](#id42c5b9369a949b68258700b9df95f04_154)] [added: [94](#i99b894486862473eb1bc3dfcf6405c73_154)] | | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 47] [added: 45] | | | [removed: ] [added: ] | | |

We have audited the accompanying consolidated balance sheets of The Hershey Company (the Company) as of December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] the related consolidated statements of income, comprehensive income, cash flows, and [removed: stockholders’] [added: stockholders'] equity for each of the three years in the period ended December 31, [removed: 2021,] [added: 2022,] and the related notes and financial statement schedule listed in the Index at Item 15(a)(2) (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2021,] [added: 2022,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the [removed: Company’s] [added: Company's] internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February [removed: 18, 2022] [added: 17, 2023] expressed an unqualified opinion thereon.

Critical Audit [removed: Matters][added: Matter]

The critical audit [removed: matters] [added: matter] communicated below [removed: are matters] [added: is a matter] arising from the current period audit of the financial statements that [removed: were] [added: was] communicated or required to be communicated to the audit committee and that: (1) [removed: relate] [added: relates] to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of [added: the] critical audit [removed: matters] [added: matter] does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit [removed: matters] [added: matter] below, providing [added: a] separate [removed: opinions] [added: opinion] on the critical audit [removed: matters] [added: matter] or on the accounts or disclosures to which [removed: they relate.][added: it relates.]

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 48] [added: 46] | | | [removed: ] [added: ] | | |

| *Description of the Matter* | | | | | | The unsettled portion of the Company’s obligation for trade promotion activities at December 31, [removed: 2021] [added: 2022] was [removed: $174.0] [added: $215.7] million. As discussed in Note 1 of the consolidated financial statements, the Company promotes its products through programs such as, but not limited to, discounts, coupons, rebates, in-store display incentives, and volume-based incentives. The Company recognizes the estimated costs of these trade promotion activities as a component of variable consideration when determining the transaction price. The unsettled portion of the Company’s obligation for trade promotion activities is included in accrued liabilities in the consolidated balance sheet. Auditing management’s calculation of the unsettled portion of the Company’s obligation for trade promotion activities was highly subjective and required significant judgment as a result of the nature of the required estimates and assumptions. In particular, the estimates required an analysis of the programs offered, expectations regarding customer and consumer participation, historical sales and payment trends, and experience with payment patterns associated with similar programs offered in the past. The estimated cost of these programs is sensitive to changes in trends with regard to customer and consumer participation, particularly for new programs and for programs related to the introduction of new products. | | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 49] [added: 47] | | | [removed: ] [added: ] | | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 50] [added: 48] | | | [removed: ] [added: ] | | |

We have audited The Hershey Company’s internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

In our opinion, The Hershey Company (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2021,] [added: 2022,] based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, [removed: 2021] [added: 2022] and [removed: 2020,] [added: 2021,] the related consolidated statements of income, comprehensive income, cash flows, and stockholders' equity for each of the three years in the period ended December 31, [removed: 2021,] [added: 2022,] and the related notes and financial statement schedule listed in the Index at Item 15(a)(2) and our report dated February [removed: 18, 2022] [added: 17, 2023] expressed an unqualified opinion thereon.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 51] [added: 49] | | | [removed: ] [added: ] | | |

| [Note 14 - Equity and](#i99b894486862473eb1bc3dfcf6405c73_139) [Treasury Stock Activity](#i99b894486862473eb1bc3dfcf6405c73_139) | | | | | | [88](#i99b894486862473eb1bc3dfcf6405c73_139) | | |

| [Note 1](#i99b894486862473eb1bc3dfcf6405c73_1624)[8](#i99b894486862473eb1bc3dfcf6405c73_1624) [- Related Party Transactions](#i99b894486862473eb1bc3dfcf6405c73_1624) | | | | | | [99](#i99b894486862473eb1bc3dfcf6405c73_1624) | | |

| February 17, 2023 | | |

| February 17, 2023 | | |

| Cash and cash equivalents | | | | | | $ | 463,889 | | | | | $ | 329,266 | |

| Exercise of stock options | | | | | | 34,158 | | | | | | 49,821 | | | | | | 46,372 | | |

| Taxes withheld and paid on employee stock awards | | | | | | (35,515) | | | | | | (16,610) | | | | | | (20,840) | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Net income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,644,817 | | | | | | | | | | | | | | | | | | — | | | | | | 1,644,817 | | |

| Other comprehensive loss | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (3,118) | | | | | | — | | | | | | (3,118) | | |

| Conversion of Class B Common Stock into Common Stock | | | | | | | | | | | | 2,500 | | | | | | (2,500) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | — | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Balance, December 31, 2022 | | | | | | $ | — | | | | | $ | 163,439 | | | | | $ | 58,114 | | | | | $ | 1,296,572 | | | | | $ | 3,589,781 | | | | | $ | (1,556,029) | | | | | $ | (252,333) | | | | | $ | — | | | | | $ | 3,299,544 | |

The Company currently operates through three segments that are aligned with its management structure and the key markets it serves: (i) North America Confectionery, (ii) North America Salty Snacks and (iii) International.

The estimated costs

Prepaid advertising expense was $241 as of December 31, 2022.

required.

Supplier Finance Program Obligations

During 2020, we entered into an agreement with a third-party financial institution to facilitate a supplier finance program which allows qualifying suppliers to sell their receivables from the Company to the financial institution.

These participating suppliers negotiate their outstanding receivable arrangements directly with the financial institution, and our rights and obligations to our suppliers are not impacted.

We have no economic interest in a supplier’s decision to enter into these agreements.

Once a qualifying supplier elects to participate in the supplier finance program and reaches an agreement with a financial institution, they elect which individual Company invoices they sell to the financial institution.

However, all Company payments to participating suppliers are paid to the financial institution on the invoice due date, regardless of whether the individual invoice is sold by the supplier to the financial institution.

The financial institution pays the supplier on the invoice due date for any invoices that were not previously sold under the supplier finance program.

Our obligations to our suppliers, including amounts due and scheduled payment terms, are not impacted by our suppliers’ decisions to sell amounts under these arrangements.

The payment of these obligations is included in cash provided by operating activities in the Consolidated Statements of Cash Flows.

Included in Accounts Payable in the Consolidated Balance Sheets at December 31, 2022 and 2021 were $105,293 and $36,386 of outstanding payment obligations, respectively, that were sold to the financial institution under the Company’s supplier finance program.

or obtain internal-use software (and hosting arrangements that include an internal-use software license).

In September 2022, the FASB issued ASU No. 2022-04, *Liabilities—Supplier Finance Programs (Subtopic 405-50):*

*Disclosure of Supplier Finance Program Obligations*.

This ASU requires a buyer in a supplier finance program to disclose qualitative and quantitative information about the program including the program’s nature, activity during the period, changes from period to period and potential magnitude.

ASU 2022-04 is effective for annual periods beginning after December 15, 2022 and interim periods within those annual periods.

This ASU should be applied retrospectively to each period in which a balance sheet is presented, except for the amendment on rollforward information, which should be applied prospectively.

We early adopted provisions of this ASU in the fourth quarter of 2022, with the exception of the amendment on rollforward information, which will be adopted in the fourth quarter of 2023.

| Goodwill | | | $ | 166,191 | |

| Goodwill | | | $ | 284,427 | |

The purchase price allocation presented above has been finalized as of the third quarter of 2022 and includes an immaterial amount of measurement period adjustments.

| | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- |

| [Note 14 - Equity and Noncontrolling Interest](#id42c5b9369a949b68258700b9df95f04_139) | | | | | | [94](#id42c5b9369a949b68258700b9df95f04_139) | | |

| | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Valuation of Identifiable Intangible Assets in Business Acquisitions | | | | | | | | |

| *Description of the Matter* | | | | | | As discussed in Note 2 of the consolidated financial statements, the Company completed the acquisitions of Lily’s Sweets, LLC on June 25, 2021 for net consideration of $427.2 million, Dot’s Pretzels, LLC on December 13, 2021 for net consideration of $894.2 million, and Pretzels Inc. on December 14, 2021 for net consideration of $304.5 million in transactions that were accounted for as business combinations (collectively, “the Business Acquisitions”). Auditing the Company’s accounting for the Business Acquisitions was complex due to the significant estimation uncertainty in the Company’s determination of the fair value of acquired identifiable intangible assets, which principally consisted of trademarks with an estimated fair value of $493.9 million in aggregate and customer relationships with an estimated fair value of $300.3 million in aggregate. The significant estimation uncertainty was primarily due to the sensitivity of the respective fair values to underlying assumptions about the future performance of the Business Acquisitions and due to the limited historical data on which those assumptions were based. The Company used a discounted cash flow model to measure these acquired identifiable intangible assets. The significant assumptions used to estimate the fair value of the trademarks and customer relationships included discount rates, royalty rates, customer attrition rates, and certain significant assumptions that formed the basis of projected cash flows, including forecasted revenue growth rates and operating margins. These significant assumptions are forward-looking and could be affected by future economic and market conditions. | | |

| *How We Addressed the Matter in Our Audit* | | | | | | We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s valuation of the acquired identifiable intangible assets. For example, we tested controls over the recognition and measurement of these intangible assets, including management’s review of the significant assumptions and methods discussed above. To test the estimated fair value of the acquired trademarks and customer relationships, we performed audit procedures that included, among others, evaluating the Company’s selection of valuation methods and testing the models and significant assumptions discussed above, including the completeness and accuracy of the underlying data. For example, we compared the significant assumptions to current industry, market, and economic trends and to the historical results of the Business Acquisitions. We also performed sensitivity analyses of these significant assumptions to evaluate the changes in the fair value of the acquired identifiable intangible assets that would result from changes in the assumptions. We involved our valuation specialists to assist in evaluating the significant assumptions and methodologies used by the Company. | | |

| February 18, 2022 | | |

As indicated in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of Lily’s Sweets, LLC, Dot’s Pretzels, LLC, or Pretzels Inc. (collectively, “the Acquired Companies”) which are included in the 2021 consolidated financial statements of the Company and constituted 17.1% of total assets as of December 31, 2021 and 0.9% of net sales for the year then ended.

Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of the Acquired Companies.

THE HERSHEY COMPANY

| Noncontrolling interest in subsidiary | | | | | | — | | | | | | 3,531 | | |

| Total stockholders’ equity | | | | | | 2,757,229 | | | | | | 2,237,883 | | |

| Exercise of stock options | | | | | | 33,211 | | | | | | 25,532 | | | | | | 240,806 | | |

| Cash and cash equivalents, beginning of period | | | | | | 1,143,987 | | | | | | 493,262 | | | | | | 587,998 | | |

| Balance, January 1, 2019 | | | | | | $ | — | | | | | $ | 299,287 | | | | | $ | 60,614 | | | | | $ | 982,205 | | | | | $ | 7,032,020 | | | | | $ | (6,618,625) | | | | | $ | (356,780) | | | | | $ | 8,545 | | | | | $ | 1,407,266 | |

| Net income (loss) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,149,692 | | | | | | | | | | | | | | | | | | (2,940) | | | | | | 1,146,752 | | |

| Other comprehensive income | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 32,814 | | | | | | 167 | | | | | | 32,981 | | |

| Retirement of treasury common stock | | | | | | | | | | | | (138,348) | | | | | | | | | | | | | | | | | | (6,284,919) | | | | | | 6,423,267 | | | | | | | | | | | | | | | | | | — | | |

| Impact of ASU 2016-02 related to leases | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 3,913 | | | | | | | | | | | | | | | | | | | | | | | | 3,913 | | |

(amounts in thousands, except share data or if otherwise indicated)

Since December 31, 2014, the Company has reported its operations through two segments: (i) North America and (ii) International and Other.

After the completion of the Company’s acquisitions of Dot’s Pretzels, LLC (“Dot’s”) and Pretzels Inc.(“Pretzels”) in December 2021, management of the Company has elected to begin reporting its operations through three reportable segments.

See [Note 14](#id42c5b9369a949b68258700b9df95f04_139) for information on our noncontrolling interest, which was divested in January 2021.

COVID-19

On March 11, 2020, the World Health Organization designated coronavirus disease 2019 (“COVID-19”) as a global pandemic.

We continue to actively monitor COVID-19 and its potential impact on our operations and financial results.

Employee health and safety remains our first priority while we continue our efforts to support community food supplies.

Since the onset of COVID-19, there has been minimal disruption to our supply chain network, and all our manufacturing plants are currently open.

However, during 2021, continued strong demand for consumer goods and the effects of COVID-19 mitigation strategies have led to broad-based supply chain disruptions across the U.S. and globally, including inflation on many consumer products, labor shortages and demand outpacing supply.

We are working closely with our business units, contract manufacturers, distributors, contractors and other external business partners to minimize the potential impact on our business.

The ultimate impact that COVID-19 will have on our consolidated financial statements remains uncertain and ultimately will be dictated by the length and severity of the pandemic, including broad-based supply chain disruptions, rising levels of inflation, the spread of COVID-19 variants or resurgences, as well as the economic recovery and actions taken in response by local, state and national governments around the world, including the distribution of vaccinations.

We will continue to evaluate the nature and extent of these potential and evolving impacts to our business and consolidated financial statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)

impairment assessment and may adjust the remaining useful lives.

In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-14, *Compensation—Retirement Benefits—Defined Benefit Plans—General (Topic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans*, which modifies the disclosure requirements for defined benefit pension plans and other post-retirement plans.

The amendments in this ASU should be applied on a retrospective basis to all periods presented.

periods within those annual periods.

We intend to early adopt the provisions of this ASU in the first quarter of 2022.

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”), as of December 31, [removed: 2021.][added: 2022.]

Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of December 31, [removed: 2021.][added: 2022.]

[removed: Other than the ongoing integrations of the aforementioned acquisitions, there] [added: There] were no changes in the Company’s internal control over financial reporting during the fourth quarter of [removed: 2021] [added: 2022] that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

[removed: When] [added: However, as] the next phases of the updated processes are rolled out in connection with the ERP implementation, we will give appropriate consideration to whether these process changes necessitate changes in the design of and testing for effectiveness of internal controls over financial reporting.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 101] [added: 95] | | | [removed: ] [added: ] | | |

The Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, [removed: 2021.][added: 2022.]

Based on this assessment, management concluded that, as of December 31, [removed: 2021,] [added: 2022,] the Company’s internal control over financial reporting was effective based on those criteria.

The Company’s independent auditors have audited, and reported on, the Company’s internal control over financial reporting as of December 31, [removed: 2021.][added: 2022.]

During the third quarter of 2022, we completed the implementation of our new ERP system for one operating segment which is included in our International segment.

The portion of the transition to the new ERP system which we have completed to date did not result in significant changes in our internal control over financial reporting.

During 2021, the Company acquired Lily’s (June 2021) and Dot’s and Pretzels (December 2021).

Management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of Lily’s Sweets, LLC, which was acquired on June 25, 2021; Dot’s Pretzels, LLC, which was acquired on December 13, 2021; or Pretzels Inc., which was acquired on December 14, 2021, all of which are included in the 2021 consolidated financial statements of the Company and constituted 17.1% of total assets as of December 31, 2021 and 0.9% of net sales for the year then ended.

These exclusions are in accordance with the guidance issued by the U.S. Securities and Exchange Commission that allows companies to exclude acquisitions from management’s report on internal control over financial reporting for the first year after the acquisition.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 102] [added: 96] | | | [removed: ] [added: ] | | |

There are no inadvertent late filings under Section 16(a) of the Securities Exchange Act of 1934, as amended.

Information regarding the compensation of each of our named executive officers, including our Chief Executive [removed: Officer,] [added: Officer that is required by this Item 11] will be located in the Proxy Statement in the section entitled “Compensation Discussion & [removed: Analysis,” which information] [added: Analysis” and] is incorporated herein by reference.

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 103] [added: 97] | | | [removed: ] [added: ] | | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 104] [added: 98] | | | [removed: ] [added: ] | | |

Schedule II—Valuation and Qualifying Accounts for The Hershey Company and its subsidiaries for the years ended December 31, [removed: 2021, 2020] [added: 2022, 2021] and [removed: 2019] [added: 2020] is filed as part of this Annual Report on Form 10-K as required by Item 15(c).

| [3.2](http://www.sec.gov/Archives/edgar/data/47111/000004711119000010/hsy_20181231exhibit32by-la.htm) | | | | | | [The [removed: Company](http://www.sec.gov/Archives/edgar/data/47111/000004711119000010/hsy_20181231exhibit32by-la.htm)[’](http://www.sec.gov/Archives/edgar/data/47111/000004711119000010/hsy_20181231exhibit32by-la.htm)[s] [added: Company’s] By-laws, as amended and restated as of February 21, 2017, are incorporated by reference from Exhibit 3.2 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.](http://www.sec.gov/Archives/edgar/data/47111/000004711119000010/hsy_20181231exhibit32by-la.htm) | | |

| [4.2](https://www.sec.gov/Archives/edgar/data/47111/000004711121000007/hsy_20201231exhibit42.htm) | | | | | | [The [removed: Company](https://www.sec.gov/Archives/edgar/data/47111/000004711121000007/hsy_20201231exhibit42.htm)[’](https://www.sec.gov/Archives/edgar/data/47111/000004711121000007/hsy_20201231exhibit42.htm)[s] [added: Company’s] Description of Common Stock and Class B Common Stock registered under Section 12 of the Exchange Act.](https://www.sec.gov/Archives/edgar/data/47111/000004711121000007/hsy_20201231exhibit42.htm)* | | |

| [Table of [removed: Contents](#id42c5b9369a949b68258700b9df95f04_7)] [added: Contents](#i99b894486862473eb1bc3dfcf6405c73_7)] | | | The Hershey Company \| [removed: 2021] [added: 2022] Form 10-K \| Page [removed: 105] [added: 99] | | | [removed: ] [added: ] | | |

| [removed: [10.6(a)](http://www.sec.gov/Archives/edgar/data/47111/000004711107000168/exh101.htm?_sm_byp=iVVJrjKkjnjqPr4r)] [added: [10.6](https://www.sec.gov/Archives/edgar/data/47111/000004711122000011/stockpurchaseagreement-214.htm)] | | | | | | [removed: [Master Innovation and Supply Agreement] [added: [Stock Purchase Agreement, dated February 14, 2022,] between [removed: the Company] [added: Milton Hershey School Trust, by its trustee, Hershey Trust Company,] and [removed: Barry Callebaut, AG, dated July 13, 2007,] [added: The Hershey Company,] is incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed [removed: July 19, 2007.](http://www.sec.gov/Archives/edgar/data/47111/000004711107000168/exh101.htm?_sm_byp=iVVJrjKkjnjqPr4r)] [added: February 16, 2022.](https://www.sec.gov/Archives/edgar/data/47111/000004711122000011/stockpurchaseagreement-214.htm)] | | |

| [removed: [10.6(b)](http://www.sec.gov/Archives/edgar/data/47111/000004711111000066/exh104.htm?_sm_byp=iVV7PRrr5tFtD2T5)] [added: [10.1](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit104.htm?_sm_byp=iVV7PRrr5tFtD2T5)[2](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit104.htm?_sm_byp=iVV7PRrr5tFtD2T5)[(](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit104.htm?_sm_byp=iVV7PRrr5tFtD2T5)[a](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit104.htm?_sm_byp=iVV7PRrr5tFtD2T5)[)](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit104.htm?_sm_byp=iVV7PRrr5tFtD2T5)] | | | | | | [removed: [First Amendment to Master Innovation and Supply Agreement between the Company and Barry Callebaut, AG, dated April 14, 2011,] [added: [Form of Notice of Award of Performance Stock Units (February 22, 2017 - February 25, 2019 version)] is incorporated by reference from Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended [removed: July 3, 2011.](http://www.sec.gov/Archives/edgar/data/47111/000004711111000066/exh104.htm?_sm_byp=iVV7PRrr5tFtD2T5)] [added: April 2, 2017.](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit104.htm?_sm_byp=iVV7PRrr5tFtD2T5)+] | | |

| [removed: [10.7](http://www.sec.gov/Archives/edgar/data/47111/000004711107000168/exh102.htm?_sm_byp=iVVJrjKkjnjqPr4r)] [added: [10.1](http://www.sec.gov/Archives/edgar/data/47111/000004711105000091/exhibit102.htm)[4](http://www.sec.gov/Archives/edgar/data/47111/000004711105000091/exhibit102.htm)] | | | | | | [removed: [Supply] [added: [The Long-Term Incentive Program Participation] Agreement [removed: for Monterrey, Mexico, between the Company and Barry Callebaut, AG, dated July 13, 2007,] is incorporated by reference from Exhibit 10.2 to the Company’s Current Report on Form 8-K filed [removed: July 19, 2007.](http://www.sec.gov/Archives/edgar/data/47111/000004711107000168/exh102.htm?_sm_byp=iVVJrjKkjnjqPr4r)] [added: February 18, 2005.](http://www.sec.gov/Archives/edgar/data/47111/000004711105000091/exhibit102.htm)+] | | |

| [removed: [10.8](http://www.sec.gov/Archives/edgar/data/47111/000119312511066689/ddef14a.htm?_sm_byp=iVVJrjKkjnjqPr4r)] [added: [10.](http://www.sec.gov/Archives/edgar/data/47111/000119312511066689/ddef14a.htm?_sm_byp=iVVJrjKkjnjqPr4r)[8](http://www.sec.gov/Archives/edgar/data/47111/000119312511066689/ddef14a.htm?_sm_byp=iVVJrjKkjnjqPr4r)] | | | | | | [The Company’s Equity and Incentive Compensation Plan, amended and restated February 22, 2011, and approved by our stockholders on April 28, 2011, is incorporated by reference from Appendix B to the Company’s proxy statement filed March 15, 2011.](http://www.sec.gov/Archives/edgar/data/47111/000119312511066689/ddef14a.htm?_sm_byp=iVVJrjKkjnjqPr4r)+ | | |

| [removed: [10.9(](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1010b.htm?_sm_byp=iVVJrjKkjnjqPr4r)[a](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1010b.htm?_sm_byp=iVVJrjKkjnjqPr4r)[)](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1010b.htm?_sm_byp=iVVJrjKkjnjqPr4r)] [added: [10.1](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1012b.htm?_sm_byp=iVVJrjKkjnjqPr4r)[1](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1012b.htm?_sm_byp=iVVJrjKkjnjqPr4r)[(b)](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1012b.htm?_sm_byp=iVVJrjKkjnjqPr4r)] | | | | | | [removed: [Form of Notice of Award] [added: [Terms and Conditions] of [removed: Restricted] [added: Nonqualified] Stock [removed: Units (](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1010b.htm?_sm_byp=iVVJrjKkjnjqPr4r)[February] [added: Option Awards under the Equity and Incentive Compensation Plan (February] 15, 2016 - February 21, 2017 version) is incorporated by reference from Exhibit [removed: 10.10(b)] [added: 10.12(b)] to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2016.](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1010b.htm?_sm_byp=iVVJrjKkjnjqPr4r)+] [added: 2016.](http://www.sec.gov/Archives/edgar/data/47111/000004711117000005/hsy_20161231exhibit1012b.htm?_sm_byp=iVVJrjKkjnjqPr4r)+] | | |

| [removed: [10.9(](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)[b](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)[)](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)] [added: [10.](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)[9](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)[(](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)[a](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)[)](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)] | | | | | | [Form of Notice of Award of Restricted Stock Units (February 22, 2017 - February 25, 2019 version) is incorporated by reference from Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended April 2, 2017.](http://www.sec.gov/Archives/edgar/data/47111/000004711117000022/hsy_20170402exhibit101.htm?_sm_byp=iVV7PRrr5tFtD2T5)+ | | |

| [removed: [10.9(](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)[c](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)[)](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)] [added: [10.](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)[9](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)[(](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)[b](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)[)](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)] | | | | | | [Form of Notice of Award of Restricted Stock Units [removed: (](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)[February] [added: (February] 26, [removed: 2019](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm) [-] [added: 2019 -] February 22, 2021 [removed: version](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)[)] [added: version)] is incorporated by reference from Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2019.](http://www.sec.gov/Archives/edgar/data/47111/000004711119000023/exhibit101-2019rsunoti.htm)+ | | |

| [removed: [10.9(d)](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm)] [added: [10.](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm)[9](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm)[(](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm)[c](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm)[)](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm)] | | | | | | [Form of Notice of Award of Restricted Stock Units (effective February 23, 2021) is incorporated by reference from Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter [removed: ended](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm) [April](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm) [4](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm)[,] [added: ended April 4,] 2021.](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit101.htm)+ | | |

| [removed: [10.9(e)](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)] [added: [10.](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)[9](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)[(](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)[d](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)[)](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)] | | | | | | [Form of Notice of Award of Restricted Stock Units (3-year vest, effective February 23, 2021) is incorporated by reference from Exhibit 10.2 to the [removed: Company](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)[’](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)[s] [added: Company’s] Quarterly Report on Form 10-Q for the quarter [removed: ended](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm) [April 4](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)[,] [added: ended April 4,] 2021.](https://www.sec.gov/Archives/edgar/data/47111/000004711121000027/hsy_20210404exhibit102.htm)+ | | |

| [removed: [10.10(](http://www.sec.gov/Archives/edgar/data/47111/000004711116000115/a8-k_06172016exhibit101.htm?_sm_byp=iVVJrjKkjnjqPr4r)[a](http://www.sec.gov/Archives/edgar/data/47111/000004711116000115/a8-k_06172016exhibit101.htm?_sm_byp=iVVJrjKkjnjqPr4r)[)](http://www.sec.gov/Archives/edgar/data/47111/000004711116000115/a8-k_06172016exhibit101.htm?_sm_byp=iVVJrjKkjnjqPr4r)] [added: [10.1](http://www.sec.gov/Archives/edgar/data/47111/000004711117000024/exhibit101noticeofspeciala.htm)[3](http://www.sec.gov/Archives/edgar/data/47111/000004711117000024/exhibit101noticeofspeciala.htm)[(a)](http://www.sec.gov/Archives/edgar/data/47111/000004711117000024/exhibit101noticeofspeciala.htm)] | | | | | | [Form of Notice of Special Award of [removed: Restricted] [added: Performance] Stock Units [removed: (pro-rata vest,](http://www.sec.gov/Archives/edgar/data/47111/000004711116000115/a8-k_06172016exhibit101.htm?_sm_byp=iVVJrjKkjnjqPr4r) [February 15, 2016] [added: (February 22, 2017] - February [removed: 21, 2017] [added: 22, 2021] version) is incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed [removed: June 17, 2016.](http://www.sec.gov/Archives/edgar/data/47111/000004711116000115/a8-k_06172016exhibit101.htm?_sm_byp=iVVJrjKkjnjqPr4r)+] [added: May 5, 2017.](http://www.sec.gov/Archives/edgar/data/47111/000004711117000024/exhibit101noticeofspeciala.htm)+] | | |