NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

   The accompanying unaudited consolidated financial statements include the accounts of Hershey Foods Corporation and its majority-owned subsidiaries (the “Corporation”) after elimination of intercompany accounts and transactions. These statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring accruals) considered necessary for a fair presentation have been included. Certain reclassifications have been made to prior year amounts to conform to the 2003 presentation. Operating results for the three months ended March 30, 2003, are not necessarily indicative of the results that may be expected for the year ending December 31, 2003, because of the seasonal effects of the Corporation’s business. For more information, refer to the consolidated financial statements and notes included in the Corporation’s 2002 Annual Report on Form 10-K.

2. EMPLOYEE STOCK OPTIONS AND OTHER STOCK-BASED EMPLOYEE COMPENSATION PLANS

   As of March 30, 2003, the Corporation had two stock-based employee compensation plans. The Corporation applies the recognition and measurement principles of Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to Employees, and related Interpretations in accounting for those plans. No stock-based employee compensation expense is reflected in net income for employee stock options since all stock options are granted at an exercise price equal to the market value of the underlying common stock on the date of grant. Compensation expense for performance stock units is recognized ratably over a period of up to seventy-two months based on the quarter-end market values of the stock. The following table illustrates the effect on net income and earnings per share if the Corporation had applied the fair value recognition provisions of Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation, to stock-based employee compensation.

                                                                   For the Three Months Ended
                                                                   --------------------------
                                                                    March 30,      March 31,
                                                                      2003          2002
                                                                      ----          ----
                                                                     (in thousands of dollars
                                                                     except per share amounts)


       Net income, as reported                                     $ 97,558         $ 87,045
       Deduct:  Total stock-based employee compensation expense
       determined under fair value method, net of related tax
       effects                                                       (3,685)          (3,075)
                                                                    -------          -------
       Pro forma net income                                        $ 93,873         $ 83,970
                                                                    =======          =======
       Earnings per share:
          Basic - as reported                                      $    .73         $    .64
                                                                    =======          =======
          Basic - pro forma                                        $    .70         $    .61
                                                                    =======          =======
          Diluted - as reported                                    $    .73         $    .63
                                                                    =======          =======
          Diluted - pro forma                                      $    .70         $    .61
                                                                    =======          =======

The fair value of each option grant is estimated on the date of grant using a Black-Scholes option-pricing model with the following weighted-average assumptions used for grants in the first three months of 2003 and 2002, respectively: dividend yields of 2.0% and 1.9%; expected volatility of 28% and 28%; risk-free interest rates of 3.6% and 4.7%; and expected lives of 6.4 years and 6.4 years.

3. BUSINESS REALIGNMENT INITIATIVES

   In late October 2001, the Corporation’s Board of Directors approved a plan to improve the efficiency and profitability of the Corporation’s operations. The plan included asset management improvements, product line rationalization, supply chain efficiency improvements, and a voluntary work force reduction program (collectively, “the business realignment initiatives”). The major components were completed as of December 31, 2002. For more information on the business realignment initiatives recorded in the fourth quarter of 2001 and during 2002, refer to the consolidated financial statements and notes included in the Corporation’s 2002 Annual Report on Form 10-K.

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4. INTEREST EXPENSE

   Interest expense, net consisted of the following:

                                                     For the Three Months Ended
                                                     --------------------------
                                                March 30, 2003        March 31, 2002
                                                --------------        -------------
                                                     (in thousands of dollars)

       Interest expense                          $ 16,238              $ 16,573
       Interest income                             (1,001)                 (779)
       Capitalized interest                          (626)                 (329)
                                                  -------               -------
        Interest expense, net                    $ 14,611              $ 15,465
                                                  =======               =======

5. NET INCOME PER SHARE

   In accordance with Statement of Financial Accounting Standards No. 128, Earnings Per Share, Basic and Diluted Earnings per Share are computed based on the weighted-average number of shares of the Common Stock and the Class B Stock outstanding as follows:

                                                         For the Three Months Ended
                                                         --------------------------
                                                      March 30, 2003   March 31, 2002
                                                      --------------   --------------
                                                          (in thousands of dollars
                                                          except per share amounts)

       Net income                                       $  97,558       $  87,045
                                                         =========       ========
       Weighted-average shares-basic                      133,366         136,707
       Effect of dilutive securities:
         Employee stock options                               808           1,431
         Performance and restricted stock units                54              81
                                                         ---------      ---------

       Weighted-average shares - diluted                  134,228         138,219
                                                         =========      =========

       Net income per share - basic                     $    0.73       $    0.64
                                                         =========       ========

       Net income per share-diluted                     $    0.73       $    0.63
                                                         =========       ========

Employee stock options for 3,076,594 shares and 1,237,955 shares were anti-dilutive and were excluded from the earnings per share calculation for the three months ended March 30, 2003 and March 31, 2002, respectively.

6. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

   The Corporation accounts for derivative instruments in accordance with Statement of Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended. All derivative instruments currently utilized by the Corporation, including foreign exchange forward contracts, interest rate swap agreements and commodities futures contracts, are designated as cash flow hedges.

   Net after-tax losses on cash flow hedging derivatives reflected in comprehensive income were $9.3 million for the three months ended March 30, 2003. Net after-tax gains on cash flow hedging derivatives reflected in comprehensive income were $17.5 million for the three months ended March 31, 2002. Net gains and losses on cash flow hedging derivatives were primarily associated with commodities futures contracts. Reclassification adjustments from accumulated other comprehensive income (loss) to income, for gains or losses on cash flow hedging derivatives, were reflected in cost of sales. Reclassification of gains of $12.8 million and $3.1 million for the three months ended March 30, 2003 and March 31, 2002, respectively, were associated with commodities futures contracts. No gains or losses as a result of hedge ineffectiveness were incurred during the three months ended March 30, 2003. Gains on commodities futures contracts recognized in cost of sales as a result of hedge ineffectiveness were approximately $.5 million before tax for the three months ended March 31, 2002. No gains or losses on cash flow hedging derivatives were reclassified from accumulated other comprehensive income (loss) into income as a result of the discontinuance of a hedge because it became probable that a hedged forecasted transaction would not occur. There were no components of gains or losses on cash flow hedging derivatives that were recognized in income because such components were excluded from the assessment of hedge effectiveness.

   -6-

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   As of March 30, 2003, and March 31, 2002, the amount of net after-tax gains on cash flow hedging derivatives, including foreign exchange forward contracts, interest rate swap agreements and commodities futures contracts, expected to be reclassified into earnings in the next twelve months were approximately $54.3 million and $14.9 million, respectively, which were principally associated with commodities futures contracts. For more information, refer to the consolidated financial statements and notes included in the Corporation’s 2002 Annual Report on Form 10-K.

7. COMPREHENSIVE INCOME

   Comprehensive income consisted of the following:

                                                          For the Three Months Ended
                                                          --------------------------
                                                            March 30,        March 31,
                                                              2003             2002
                                                              ----             ----
                                                           (in thousands of dollars)
   
        Net income                                        $  97,558          $  87,045
                                                           --------            -------
        Other comprehensive income (loss):
          Foreign currency translation
          adjustments                                        13,181                302
          Minimum pension liability
          adjustments, net of tax                            (2,092)            22,732
          (Losses) gains on cash flow hedging
          derivatives, net of tax                            (9,255)            17,534
   
          Add:  Reclassification adjustments,
          net of tax                                        (12,801)            (3,102)
                                                           --------           --------
        Other comprehensive (loss) income                   (10,967)            37,466
                                                           --------           --------
        Comprehensive income                              $  86,591          $ 124,511
                                                           ========           ========
   

   The components of accumulated other comprehensive income (loss) as shown on the Consolidated Balance Sheets are as follows:

                                                  Foreign      Minimum   Gains (Losses)  Accumulated
                                                 Currency      Pension    on Cash Flow     Other
                                                Translation   Liability      Hedging    Comprehensive
                                                Adjustments  Adjustments   Derivatives  Income (Loss)
   
    (In thousands of dollars)
   
    Balance as of 12/31/02                       $(79,075)    $  (236)    $100,382      $ 21,071
      Current period credit (charge), gross        13,181      (3,492)     (14,621)       (4,932)
      Income tax benefit (expense)                      -       1,399        5,366         6,765
      Reclassification adjustment
        charge (credit), gross                          -           -      (20,223)      (20,223)
      Income tax benefit (expense)                      -           -        7,422         7,422
                                                  -------      ------      -------       -------
    Balance as of 3/30/03                        $(65,894)    $(2,329)    $ 78,326      $ 10,103
                                                  =======      ======      =======       =======
   

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   8. INVENTORIES

      The majority of inventories are valued under the last-in, first-out (LIFO) method. The remaining inventories are stated at the lower of first-in, first-out (FIFO) cost or market. Inventories were as follows:

                                              March 30, 2003       December 31, 2002
                                              --------------       -----------------
                                                       (in thousands of dollars)
   
       Raw materials                         $   214,022           $   154,893
       Goods in process                           59,470                53,814
       Finished goods                            328,677               347,677
                                               ---------            ----------
             Inventories at FIFO                 602,169               556,384
       Adjustment to LIFO                        (47,686)              (53,093)
                                               ---------            ----------
            Total inventories                $   554,483           $   503,291
                                               =========            ==========
   

   The increase in raw material inventories as of March 30, 2003, reflected the seasonal timing of deliveries to support manufacturing requirements. Raw material inventories were $214.0 million as of March 30, 2003 compared to $212.5 million as of March 31, 2002. Finished goods inventory was higher as of December 31, 2002 to support seasonal sales in the first quarter of 2003.

   9. LONG-TERM DEBT

      In August 1997, the Corporation filed a Form S-3 Registration Statement under which it could offer, on a delayed or continuous basis, up to $500 million of additional debt securities. As of March 30, 2003, $250 million of debt securities remained available for issuance under the August 1997 Registration Statement.

   10. FINANCIAL INSTRUMENTS

       The carrying amounts of financial instruments including cash and cash equivalents, accounts receivable, accounts payable and short-term debt approximated fair value as of March 30, 2003 and December 31, 2002, because of the relatively short maturity of these instruments. The carrying value of long-term debt, including the current portion, was $868.6 million as of March 30, 2003, compared to a fair value of $1,008.2 million, based on quoted market prices for the same or similar debt issues.

       As of March 30, 2003, the Corporation had foreign exchange forward contracts maturing in 2003 and 2004 to purchase $39.0 million in foreign currency, primarily British sterling and euros, and to sell $17.2 million in foreign currency, primarily Japanese yen, at contracted forward rates.

       The fair value of foreign exchange forward contracts is estimated by obtaining quotes for future contracts with similar terms, adjusted where necessary for maturity differences. As of March 30, 2003, the fair value of foreign exchange forward contracts was an asset of $2.5 million. As of December 31, 2002, the fair value of foreign exchange forward contracts was an asset of $3.1 million. The Corporation does not hold or issue financial instruments for trading purposes.

       In order to minimize its financing costs and to manage interest rate exposure, the Corporation, from time to time, enters into interest rate swap agreements. In February 2001, the Corporation entered into interest rate swap agreements that effectively converted variable-interest-rate rental payments on certain operating leases from a variable to a fixed rate of 6.1%. Any interest rate differential on interest rate swap agreements is recognized as an adjustment to interest expense over the term of each agreement. The fair value of interest rate swap agreements was a liability of $8.2 million and $7.1 million as of March 30, 2003 and December 31, 2002, respectively. The Corporation’s risk related to interest rate swap agreements is limited to the cost of replacing such agreements at prevailing market rates.

   11. SHARE REPURCHASES

       In December 2002, the Corporation’s Board of Directors approved a share repurchase program authorizing the repurchase of up to $500 million of the Corporation’s Common Stock. Under this program, a total of 2,911,300 shares of Common Stock was purchased through March 30, 2003 for $187.1 million. As of March 30, 2003, a total of 48,778,036 shares were held as Treasury Stock and $312.9 million remained available for repurchases of Common Stock under the repurchase program.

       -8-

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   12. NEW ACCOUNTING PRONOUNCEMENT

       In January 2003, the Financial Accounting Standards Board issued Interpretation No. 46, Consolidation of Variable Interest Entities, an interpretation of ARB No. 51. This Interpretation addresses consolidation by business enterprises of special-purpose entities (SPEs) to which the usual condition for consolidation described in Accounting Research Bulletin No. 51, Consolidated Financial Statements, does not apply because the SPEs have no voting interests or otherwise are not subject to control through ownership of voting interests.

       The Interpretation is effective for calendar year companies beginning in the third quarter of 2003 and it is reasonably possible that the Interpretation will require the consolidation of the Corporation’s three off-balance sheet arrangements with SPTs for the leasing of certain warehouse and distribution facilities. The consolidation of these entities will result in an increase to property, plant and equipment of approximately $120.0 million, with a corresponding increase to long-term debt and minority interest. The consolidation of these entities will also result in an increase to depreciation expense of approximately $5.0 million on an annual basis.

   -9-

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   Item 2. Management's Discussion and Analysis of Results of Operations and Financial Condition

   Results of Operations - First Quarter 2003 vs. First Quarter 2002

   Net sales for the first quarter decreased from $988.5 million in 2002 to $953.2 million in 2003. The decrease in sales primarily resulted from a buy-in associated with a price increase announced in December 2002, as previously disclosed, and the continued rationalization of certain under-performing products and brands, primarily the divestiture of Heide brands and the discontinuance of the Corporation’s aseptically packaged drink products in the United States during the second quarter of 2002. These decreases represented the majority of the decline in sales from 2002 to 2003. Incremental sales from the January 2003 selling price increase were substantially offset by higher promotional allowances.

   Cost of sales for the quarter decreased $27.1 million, or 4%, from 2002 to 2003. The decline was primarily caused by lower sales volume, reduced supply chain costs, and lower costs for raw materials, primarily dairy products and peanuts, and packaging. The consolidated gross margin increased from 36.9% in 2002 to 37.4% in 2003. The margin expansion reflected the impact of the price increase, improved profitability from the product and channel sales mix and the aforementioned decreases in supply chain, raw material and packaging costs. These margin improvements were partially offset by increased promotional expenses due to competitive activity and maintaining promoted prices which had been committed to prior to the January price increase. Selling, marketing and administrative expenses decreased by 7% in the first quarter, primarily attributable to reduced advertising and consumer promotions expenses as well as continued savings from the Corporation’s business realignment initiatives. These cost reductions were offset slightly by increased packaging development and marketing research expenses. Additionally, the bad debt reserve was increased by $5.0 million in the first quarter of 2003 as an estimate of probable exposure to the bankruptcy of Fleming Companies, Inc., announced on April 1, 2003. At the time of the bankruptcy announcement, the Corporation’s accounts receivable from Fleming Companies, Inc. totaled approximately $15 million. At the present time, the Corporation does not anticipate any material impact on sales for the remainder of the year as a result of this situation.

   Total costs and expenses in the first quarter of 2002 included $9.0 million of business realignment charges reflecting a charge to cost of sales of $.2 million associated with the relocation of manufacturing equipment and $8.8 million associated with pension settlement costs related to the voluntary work force reduction program implemented as part of the Corporation’s business realignment initiatives.

   Net interest expense in the first quarter of 2003 was $.9 million less than the comparable period of 2002, primarily reflecting higher interest income and capitalized interest in 2003.

   Net income for the first quarter increased $10.5 million, or 12%, from 2002 to 2003, and net income per share - diluted increased $.10, or 16%. Net income of $87.0 million for the first quarter of 2002 included total business realignment charges of $5.7 million after tax.

   Liquidity and Capital Resources

   Historically, the Corporation’s major source of financing has been cash generated from operations. Domestic seasonal working capital needs, which typically peak during the summer months, generally have been met by issuing commercial paper. During the first quarter of 2003, the Corporation’s cash and cash equivalents decreased by $153.7 million. The reduction in cash and cash equivalents reflected the repurchase of 2.9 million shares of the Corporation’s Common Stock for $187.1 million, partially offset by cash collections during the first quarter. Cash provided from operations was sufficient to fund dividend payments of $42.5 million, capital expenditures and capitalized software additions totaling $40.0 million and incentive plan transactions of $29.7 million. Cash used by other assets and liabilities of $81.4 million was principally the result of commodities transactions and lower liabilities associated with marketing programs and incentive compensation, partially offset by an increase in accrued income taxes. Cash used by other assets and liabilities of $68.5 million in the first quarter of 2002 primarily reflected a pension plan contribution of $75.0 million and changes to liabilities associated with taxes and incentive compensation.

   The ratio of current assets to current liabilities was 2.1:1 as of March 30, 2003, and 2.3:1 as of December 31, 2002. The Corporation’s capitalization ratio (total short-term and long-term debt as a percent of stockholders’ equity, short-term and long-term debt) was 42% as of March 30, 2003, and 39% as of December 31, 2002.

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   Safe Harbor Statement

   The nature of the Corporation’s operations and the environment in which it operates subject it to changing economic, competitive, regulatory and technological conditions, risks and uncertainties. In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, the Corporation notes the following factors that, among others, could cause future results to differ materially from the forward-looking statements, expectations and assumptions expressed or implied herein. Many of the forward-looking statements contained in this document may be identified by the use of forward-looking words such as “intend,” “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated” and “potential,” among others. Factors which could cause results to differ include, but are not limited to: changes in the confectionery and grocery business environment, including actions of competitors and changes in consumer preferences; customer and consumer response to selling price increases; changes in governmental laws and regulations, including taxes; market demand for new and existing products; changes in raw material and other costs; pension cost factors, such as actuarial assumptions, market performance and employee retirement decisions; adequacy of the Corporation’s bad debt reserve; and the Corporation’s ability to implement improvements to and reduce costs associated with the Corporation’s supply chain.

   Item 3. Quantitative and Qualitative Disclosure About Market Risk

   The potential net loss in fair value of foreign exchange forward contracts and interest rate swap agreements resulting from a hypothetical near-term adverse change in market rates of ten percent increased from $.4 million as of December 31, 2002 to $.6 million as of March 30, 2003. The market risk resulting from a hypothetical adverse market price movement of ten percent associated with the estimated average fair value of net commodity positions increased from $2.4 million as of December 31, 2002, to $6.0 million as of March 30, 2003. Market risk represents 10% of the estimated average fair value of net commodity positions at four dates prior to the end of each period.

   Item 4. Controls and Procedures

   As required by Rule 13a-15 under the Securities Exchange Act of 1934 (the “Exchange Act”), within the 90 days prior to the filing date of this report, the Corporation conducted an evaluation of the effectiveness of the design and operation of the Corporation’s disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of the Corporation’s management, including the Corporation’s Chief Executive Officer and Chief Financial Officer. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Corporation’s disclosure controls and procedures are effective. There have been no significant changes in the Corporation’s internal controls or in other factors which could significantly affect internal controls subsequent to the date of the evaluation.

   Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in the Corporation’s reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in the Corporation’s reports filed under the Exchange Act is accumulated and communicated to management, including the Corporation’s Chief Executive Officer and Chief Financial Officer as appropriate, to allow timely decisions regarding required disclosure.

   -11-

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   PART II - OTHER INFORMATION

   Items 1 through 3 and 5 have been omitted as not applicable.

   Item 4 - Submission of Matters to a Vote of Security Holders

   Hershey Foods Corporation’s Annual Meeting of Stockholders was held on April 22, 2003. The following directors were elected by the holders of Common Stock and Class B Common Stock, voting together without regard to class:

                  Name                                    Votes For             Votes Withheld
                  ----                                    ---------             --------------
            Jon A. Boscia                                391,234,491                1,420,266
            Robert H. Campbell                           391,009,428                1,645,329
            Gary P. Coughlan                             391,206,039                1,448,718
            Bonnie G. Hill                               391,117,351                1,537,406
            John C. Jamison                              391,169,272                1,485,485
            Richard H. Lenny                             390,697,044                1,957,713
            Mackey J. McDonald                           391,485,495                1,169,262
   
   The following directors were elected by the holders of the Common Stock voting as a class:
   
                  Name                                    Votes For             Votes Withheld
                  ----                                    ---------             --------------
            Harriet Edelman                              87,832,439                1,065,038
            Marie J. Toulantis                           87,853,136                1,044,341
   

   Holders of the Common Stock and the Class B Common Stock voting together approved the appointment of KPMG LLP as the independent auditors for 2003. Stockholders cast 389,551,372 votes FOR the appointment, 2,336,259 votes AGAINST the appointment and ABSTAINED from casting 767,126 votes on the appointment of independent auditors.

   Holders of the Common Stock and the Class B Common Stock voting together rejected the stockholder proposal regarding the expensing of stock options. Stockholders cast 34,562,120 votes FOR the proposal, 337,791,393 votes AGAINST the proposal and ABSTAINED from casting 3,275,535 votes on the proposal.

   No other matters were submitted for stockholder action.

   Item 6 - Exhibits and Reports on Form 8-K

   a)           Exhibits

   The following items are attached and incorporated herein by reference:

   Exhibit 10 - Amended and Restated Supplemental Executive Retirement Plan.

   Exhibit 12 - Statement showing computation of ratio of earnings to fixed charges for the three months ended March 30, 2003 and March 31, 2002.

   The following item is furnished with this report:

   Exhibit 99 - Certification of Richard H. Lenny, Chief Executive Officer, and Frank Cerminara, Chief Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

   b)          Reports on Form 8-K

   A Current Report on Form 8-K was furnished to the SEC on April 22, 2003, in connection with the Corporation’s announcement that John M. Pietruski had retired from the Corporation’s Board of Directors and Harriet Edelman and Marie J. Toulantis had been elected to the Corporation’s Board of Directors, effective April 22, 2003.

   A Current Report on Form 8-K was furnished to the SEC on April 17, 2003, in connection with the Corporation’s announcement of sales and earnings for the first quarter of 2003.

   -12-

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   A Current Report on Form 8-K was furnished to the SEC on April 9, 2003, in connection with the Corporation’s announcement that Thomas K. Hernquist will be named Senior Vice President, Chief Marketing Officer, effective April 28, 2003.

   A Current Report on Form 8-K was furnished to the SEC on February 11, 2003, in connection with the Corporation’s announcement that 2003 pension expense was expected to be $12 million higher than previously disclosed.

   A Current Report on Form 8-K was furnished to the SEC on January 29, 2003, in connection with the Corporation’s announcement of sales and earnings for the fourth quarter and full year ended December 31, 2002.

   A Current Report on Form 8-K was furnished to the SEC on January 2, 2003, in connection with the Corporation’s announcement that J. Robert Hillier resigned from the Corporation’s Board of Directors effective December 31, 2002.

   -13-

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   SIGNATURES

   Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

                    HERSHEY FOODS CORPORATION
   (Registrant)

   Date: May 8, 2003

   By:   /s/Frank Cerminara   
     Frank Cerminara
              Senior Vice President,
               Chief Financial Officer

   By:   /s/David W. Tacka   
     David W. Tacka
                                     Vice President, Corporate Controller
                         and Chief Accounting Officer

   -14-

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   CERTIFICATION

           I, Richard H. Lenny, certify that:

   1. I have reviewed this quarterly report on Form 10-Q of Hershey Foods Corporation;
      
      
   2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
      
      
   3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
      
      
   4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

   a)     designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

   b)     evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and

   c)     presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

   5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors:

   a)     all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

   b)     any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

   
   
   
   6. The registrant’s other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

                 Date:     May 8, 2003         /s/ Richard H. Lenny
                                                             Richard H. Lenny
                                                             Chief Executive Officer

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   CERTIFICATION

          I, Frank Cerminara, certify that:

   1. I have reviewed this quarterly report on Form 10-Q of Hershey Foods Corporation;
      
      
   2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
      
      
   3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
      
      
   4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

   a)     designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

   b)     evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the “Evaluation Date”); and

   c)     presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

   5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and the audit committee of registrant’s board of directors:

   a)     all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and

   b)     any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

   
   
   
   6. The registrant’s other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

                 Date:     May 8, 2003      /s/ Frank Cerminara
                                                         Frank Cerminara
                                                         Chief Financial Officer

   -16-

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   EXHIBIT INDEX

   Exhibit No.

   Description

   10

   Amended and Restated Supplemental Executive Retirement Plan

   12

   Computation of Ratio of Earnings to Fixed Charges

   99

   Certification of Richard H. Lenny, Chief Executive Officer, and Frank Cerminara, Chief Financial Officer

   -17-

                                                                         Exhibit 10
   
                               HERSHEY FOODS CORPORATION
   
                              AMENDED AND RESTATED (2003)
                        SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
   
   
   
            1.    PURPOSE OF PLAN. The purpose of the Amended and Restated (2003)
   Supplemental Executive Retirement Plan, effective as of March 1, 2003,
   (hereinafter called the "Plan") is to obtain for Hershey Foods Corporation
   (hereinafter called the "Corporation") all of the benefits which flow from
   maintaining a strong management team by providing to executive and upper level
   management employees the means to continue their attained standard of living
   during retirement and by offering benefits that will assist in attracting
   executive and upper level management employees of outstanding ability. The Plan
   constitutes an amendment, restatement and continuation of the prior plan which
   was most recently restated as of August 19, 2002.
   
                  To the extent provided by law, the benefits provided hereunder
   with respect to any Participant who retired or whose employment with the
   Corporation terminated prior to March 1, 2003, will, except as otherwise
   specifically provided for herein, be governed in all respects by the terms of
   the plan document then in effect on the date of the Participant's retirement or
   other termination of employment.
   
            2.    DEFINITIONS.  The  following  words and  phrases  as used in the
   Plan shall have the following  meanings,  unless a different  meaning is plainly
   required by the context:
   
                  a. "Cause" means, as determined by the Committee in its
   reasonable discretion, the willful engaging by an employee of the Corporation in
   illegal conduct or gross misconduct which is materially and demonstrably
   injurious to the Corporation, including, without limitation, illegal conduct or
   gross misconduct that causes, or has the potential to cause, material financial
   or reputational injury to the Corporation.
   
                  For purposes of this definition, no act or failure to act, on
   the part of an employee of the Corporation, shall be considered "willful" unless
   it is done, or omitted to be done, by the employee in bad faith and without
   reasonable belief that the employee's action or omission was in the best
   interest of the Corporation. Any act or failure to act, based upon prior
   approval given by the Board or upon the instruction or with the approval of the
   Chief Executive Officer or the employee's superior or based upon the advice of
   counsel for the Corporation shall be conclusively presumed to be done, or
   omitted to be done, by the employee in good faith and in the best interest of
   the Corporation.
   
                  b. "Committee" means the Compensation and Executive
   Organization Committee of the Board of Directors of the Corporation (the
   "Board") or other such person, persons or committees as the Board may prescribe
   from time to time.
   
   
   
                  Effective as of October 2, 2001, Committee shall also mean the
   Employee Benefits Committee of the Corporation, to which the Board has delegated
   certain duties with respect to the administration of the Corporation's employee
   benefit plans, or any successor committee as designated by the Board.
   
                  c. "Deferred Retirement Date" means the first day of the month
   following an employee's termination of employment with the Corporation provided
   such termination occurs after his Normal Retirement Date.
   
                  d. "Disability" or "Disabled", for purposes of this Plan,
   shall have the same meaning as provided in Section 1.16 of the Retirement Plan,
   as such section may be amended from time to time.
   
                  e. "Early Retirement Date" means the first day of any month
   following an employee's termination of employment with the Corporation which is
   coincident with or following his fifty-fifth (55th) birthday and prior to his
   Normal Retirement Date.
   
                  f. "Final Average Compensation" means the sum of (1) the
   highest annual average of a Vested Participant's basic salary paid or accrued
   over any thirty-six (36) consecutive month period during his last ten (10) years
   of employment with the Corporation and (2) the highest annual average of his
   annual awards under the Annual Incentive Program (hereinafter called the "AIP")
   of the Corporation's Key Employee Incentive Plan ("KEIP") paid or accrued over
   any five (5) consecutive calendar years during his last ten (10) years of
   employment with the Corporation. If a Vested Participant dies, retires, or
   suffers a Disability or if a Participant suffers a Disability during a calendar
   year and only a partial AIP award is made for that year, for purposes of the
   Plan, his AIP award for such year will be considered to equal the award actually
   made divided by the fraction of such year that he was employed by the
   Corporation prior to his death, retirement or Disability. If a Vested
   Participant otherwise terminates employment with the Corporation during a
   calendar year, his AIP award for that year for purposes of the Plan will be
   considered to be zero (0), regardless of whether any AIP award is actually made
   for that year.
   
                  g. "GATT Interest Rate" means, for purposes of this Plan, for
   any specific month, the "applicable interest rate" as specified by the
   Commissioner of the Internal Revenue Service in Section 417(e)(3) of the
   Internal Revenue Code of 1986, as amended (the "Code") (as such applicable
   interest rate is modified from time to time in revenue rulings, notices or other
   guidance, published in the Internal Revenue Service Bulletin), decreased by the
   percentage applicable to such month as set forth on Schedule I attached hereto.
   
                  h. "Lump Sum Interest Rate" means, as of any specific date,
   the sum of one-twelfth (1/12th) of each GATT Interest Rate for the twelve (12)
   consecutive months beginning with the thirteenth (13th) month preceding the
   month during which such date occurs.
   
                  i. "Normal Retirement Date" means, for the purposes of this
   Plan, the first day of the month nearest an employee's sixty-fifth (65th)
   birthday, except that if his birthday is equally near the first of two (2)
   calendar months, the first day of the month prior to his sixty-fifth
   
   
   
   (65th) birthday shall be his Normal Retirement Date.
   
                  j. "PBGC Interest Rate" means, for any specific month, the
   interest rate used by the Pension Benefit Guaranty Corporation for such month
   for purposes of valuing immediate annuities for terminating single employer
   plans with insufficient assets to pay guaranteed benefits.
   
                  k. "Participant" means, as of any specific date, an employee
   of the Corporation who, as of such date, is a participant in the performance
   share unit portion of the KEIP or who, as of such date, is not then but had been
   a participant in the performance share unit portion of the KEIP for at least
   five (5) of his last ten (10) years of employment with the Corporation.
   
                  l. "Retirement Plan" means the Corporation's Retirement Plan,
   As Amended and Restated Effective as of January 1, 1997, as in effect from time
   to time and any successor plan thereto.
   
                  m. "Vested Participant" means, as of any specific date, a
   Participant who, as of such date, satisfies each eligibility requirement set
   forth in the first sentence of Section 3 of the Plan or any prior version of the
   Plan.
   
                  n. "Years of Service", for purposes of this Plan, shall have
   the same meaning as provided in Section 1.59 of the Retirement Plan, as such
   section may be amended from time to time.
   
            3.    ELIGIBILITY. An employee of the Corporation will be eligible to
   receive a benefit pursuant to Section 4 of the Plan if, at the time of his
   termination of employment with the Corporation, such employee (i) is at least
   fifty-five (55) years of age, (ii) has ten (10) Years of Service, and (iii) has
   participated in the performance share unit portion of the KEIP for at least five
   (5) of his last ten (10) years of employment with the Corporation. No employee
   of the Corporation, regardless of whether he satisfies all the eligibility
   requirements to be a Vested Participant, shall be entitled to receive any
   benefits under the Plan if his employment with the Corporation is terminated for
   Cause. Notwithstanding the above, an employee whose employment is terminated
   with the Corporation prior to his Normal Retirement Date for reason of
   Disability will be treated as provided for in Section 4.c.
   
            4.    RETIREMENT BENEFITS.
   
                  a.  Normal Retirement Benefit. An employee who qualifies as a
   Vested Participant on the date of his termination of employment with the
   Corporation, and who retires (or whose employment is otherwise terminated, other
   than for Cause) on or after his Normal Retirement Date shall be entitled under
   the Plan to receive a normal retirement benefit which shall be an annual
   benefit, payable in monthly installments, equal to:
   
   
   
                    (1)  the product of three and  two-thirds  percent (3 2/3%) of
             his Final Average  Compensation and his Years of Service not in excess
             of fifteen (15) Years of Service;
   
                    reduced by:
   
                    (2)  one hundred percent (100%) of the Vested
            Participant's retirement benefit under the Retirement Plan and any
            other tax-qualified defined benefit pension plan maintained by the
            Corporation or any affiliate thereof, payable as a life annuity
            commencing at his Normal Retirement Date or his Deferred Retirement
            Date if he retires after his Normal Retirement Date, regardless of
            whether such benefit payment is in that form or begins at that time;
            and
   
                    (3)  one hundred percent (100%) of the primary social
            security benefit to which the Vested Participant would be entitled on
            his Normal Retirement Date or his Deferred Retirement Date if he
            retires after his Normal Retirement Date regardless of whether he
            receives any portion of such primary Social Security benefit on such
            date.
   
                  Payment of such benefit shall commence on his Normal
   Retirement Date if he retires (or otherwise has his employment terminated, other
   than for Cause) on such date and on his Deferred Retirement Date if he retires
   (or otherwise has his employment terminated, other than for Cause) after his
   Normal Retirement Date.
   
                  b. Early Retirement Benefit. An employee who qualifies as a
   Vested Participant on the date of his termination of employment with the
   Corporation, and who retires (or whose employment is otherwise terminated, other
   than for Cause) on or after his Early Retirement Date and prior to his Normal
   Retirement Date shall be entitled under the Plan to receive an early retirement
   benefit which shall be an annual benefit payable in monthly installments, equal
   to:
   
                    (1)  the product of three and two-thirds percent (3
            2/3%) of his Final Average Compensation and his Years of Service not in
            excess of fifteen (15) Years of Service reduced by the sum of (2), (3)
            and (4), where (2), (3) and (4) equal:
   
                    (2)  one hundred percent (100%) of his retirement
            benefit under the Retirement Plan and any other tax-qualified defined
            benefit pension plan maintained by the Corporation or any affiliate
            thereof, payable as a life annuity commencing at his Early Retirement
            Date or the first date thereafter on which such benefits would be
            payable if they are not payable on his Early Retirement Date regardless
            of whether such benefit payment is in that form or begins at that time;
   
                    (3)  one hundred percent (100%) of the primary Social
            Security benefit to which the Vested Participant would be entitled on
            his Early Retirement Date or the first date thereafter on which such
            benefits would be payable if they are not payable on his Early
            Retirement Date regardless of whether he receives any portion of such
            primary Social Security benefit on such date; and
   
   
                    (4)  the product of (A) the difference between (1) and
            the sum of (2) and (3), (B) five-twelfths of a percent (5/12%), and (C)
            the number of complete calendar months by which the Vested
            Participant's date of termination of employment precedes his sixtieth
            (60th) birthday.
   
                  Payment of such benefit shall commence on the first day of the
   month coincident with the Vested Participant's retirement or other termination
   of employment, other than for Cause.
   
                  c. Disability Retirement Benefit. If an employee who is an
   active participant in the performance share unit portion of the KEIP suffers a
   Disability prior to his Normal Retirement Date and while employed by the
   Corporation, the period of his Disability will be recognized as Years of Service
   and as years of participation in the performance share unit portion of the KEIP
   under the Plan. If such Disability continues to his Normal Retirement Date, for
   purposes of the Plan, he will retire on that date and will be entitled to a
   normal retirement benefit calculated in accordance with Section 4.a. commencing
   on that date. In calculating the benefit under Section 4.a., the Participant's
   Final Average Compensation shall be equal to his annual base compensation
   immediately prior to his Disability plus the average of his AIP earned during
   the three (3) years immediately prior to the commencement of his Disability.
   
                  d. Pre-Retirement Death Benefit. If a Participant dies before
   his employment by the Corporation terminates and qualifies as a Vested
   Participant on his date of death, his designated beneficiary(ies), or his estate
   if he has not designated any beneficiary or beneficiaries in accordance with
   procedures established by the Committee, shall receive within ten (10) days of
   the Vested Participant's death a death benefit equal to the lump sum present
   value of one hundred percent (100%) of the retirement benefit that would have
   been payable to the Vested Participant under Sections 4.a. or 4.b. (including
   the spousal survivor benefit payable pursuant to Section 4.e. with respect to
   any Vested Participant survived by a spouse) if he had retired on the date of
   his death. The lump sum present value of the retirement benefit shall be
   calculated using: (x) for each Vested Participant who was a Vested Participant
   on January 1, 1998, (i) the 83 GAM mortality tables; and (ii) an interest rate
   equal to the sum of one-twelfth (1/12th) of each PBGC Interest Rate for the
   twelve (12) months immediately preceding the date of the Vested Participant's
   death; and (y) for each Vested Participant who first became a Vested Participant
   after January 1, 1998, (i) the prevailing commissioner's standard mortality
   table (described in Section 807(d)(5)(A) of the Internal Revenue Code of 1986,
   as amended from time to time) used to determine reserves for group annuity
   contracts issued on the date of the Vested Participant's death (without regard
   to any other subparagraph for such Section 807(d)(5)) that is prescribed by the
   Commissioner of the Internal Revenue Service in revenue rulings, notices, or
   other guidance published in the Internal Revenue Bulletin; and (ii) an interest
   rate equal to the Lump Sum Interest Rate as of the date of the Vested
   Participant's death. Notwithstanding anything in this paragraph to the contrary,
   the lump sum cash value of the benefit described in this Section 4.d. with
   respect to each Vested Participant who (A) was a Vested Participant as of
   January 1, 1998 and (B) whose employment with the Corporation terminated due to
   his or her death on or after January 1,
   
   
   2002,  shall be equal to the  greater of the value of the lump sum cash  payment
   calculated pursuant to the rates and factors set forth in subsections (x) or (y)
   of this paragraph.
   
                  e. Post-Retirement Death Benefit. If a Vested Participant who
   is receiving monthly retirement benefits under this Plan following his
   termination of employment by the Corporation dies, his surviving spouse, if he
   is survived by a spouse, shall be entitled to receive a death benefit which
   shall be a monthly payment for the spouse's life, beginning on the first day of
   the month following the Vested Participant's death, equal to:
   
                    (1)  fifty  percent  (50%) of the  monthly  retirement  benefit
            to which the Vested  Participant  was entitled under the Plan prior to
            his death;
   
                     reduced by:
   
                    (2)  the monthly annuity value of any life insurance
            provided by the Corporation or any affiliate thereof for retired
            employees that is in excess of post-retirement group term life
            insurance regularly provided by the Corporation or any affiliate
            thereof.
   
            5.    ADMINISTRATION OF THE PLAN. The Committee is charged with the
   administration of the Plan. It shall have full power and authority to construe
   and interpret the Plan. Its decisions shall be final, conclusive and binding on
   all parties. Subject to Section 10 of this Plan, the Committee shall also have
   the power, in its sole discretion, at any time (i) to waive, in whole or in
   part, application of any of the eligibility requirements of Section 3 or of the
   benefit reduction factors in Sections 4.a. and 4.b. and (ii) to determine the
   timing and form of payment of any benefit under the Plan, in the case of any
   individual Participant, Vested Participant or other employee of the Corporation
   who has participated in the performance share unit portion of the KEIP.
   
            6.    OPTIONAL FORMS OF PAYMENT. In lieu of the monthly retirement
   benefit (including the spousal survivor benefit payable pursuant to Section 4.e.
   hereof) payable pursuant to Section 4.a. or 4.b. hereof to a Vested  Participant
   (and his surviving  spouse) who retires (or whose employment is terminated other
   than  for  Cause)  after  August  2,  1994  (such  benefit  payable  to a Vested
   Participant  and/or his surviving  spouse is herein  referred to for purposes of
   this Section 6 as the "Applicable Retirement Benefit"),  such Vested Participant
   may elect to receive the following form of benefit payment:
   
                  A lump sum cash payment, payable to the Vested Participant
   within ten (10) days after the Vested Participant's date of retirement (or the
   Vested Participant's date of termination of employment other than for Cause),
   equal to the actuarial present value of the Applicable Retirement Benefit,
   calculated using: (x) for each Vested Participant who was a Vested Participant
   on January 1, 1998, (i) the 83 GAM mortality tables; and (ii) an interest rate
   equal to one-twelfth (1/12th) of each PBGC Interest Rate for the twelve (12)
   months immediately preceding the date of the Vested Participant's retirement (or
   the Vested Participant's date of termination of employment other than for
   Cause), calculated in accordance with the Corporation's practices for
   determining retirement benefits; and (y) for
   
   
   
   each Vested  Participant who first became a Vested  Participant after January 1,
   1998 (i) the prevailing  commissioner's  standard  mortality table (described in
   Section  807(d)(5)(A) of the Internal Revenue Code of 1986, as amended from time
   to time) used to determine  reserves for group annuity  contracts  issued on the
   date of the Vested Participant's retirement (or the Vested Participant's date of
   termination  of employment  other than for Cause)  (without  regard to any other
   subparagraph of such Section  807(d)(5)) that is prescribed by the  Commissioner
   of the Internal Revenue Service in revenue rulings,  notices,  or other guidance
   published in the Internal Revenue  Bulletin;  and (ii) an interest rate equal to
   the  Lump  Sum  Interest  Rate  as of  the  date  of  the  Vested  Participant's
   retirement. Notwithstanding anything in this paragraph to the contrary, the lump
   sum cash value of the Applicable  Retirement Benefit for each Vested Participant
   who (A) was a Vested  Participant as of January 1, 1998 and (B) whose employment
   with the Corporation  terminated on or after January 1, 2002,  shall be equal to
   the greater of the value of the lump sum cash payment calculated pursuant to the
   rates and factors set forth in subsections (x) or (y) of this paragraph.
   
                  Any such election must be made by those Participants
   designated by the Committee from time to time at least two (2) years and by all
   other Participants at least one (1) year prior to the date that the Applicable
   Retirement Benefit payments would otherwise become payable.
   
            7.    PAYMENT UPON CHANGE IN CONTROL
   
                  a. Any former employee or the surviving spouse of an employee
   or former employee who is receiving a benefit under Sections 4.a., 4.b., 4.d. or
   4.e. hereof (or pursuant to the terms of any version of this Plan) at the time
   of a Change in Control (collectively or individually, "SERP Recipient") shall
   receive, in lieu of the future monthly retirement benefit (including the spousal
   survivor benefit in the case of a benefit under Section 4.a. or 4.b.) to which
   he is entitled (such future benefit payable to the SERP Recipient is herein
   referred to for purposes of this Section 7.a. as the "Future Retirement
   Benefit"), a lump sum cash payment, payable to the SERP Recipient, as
   applicable, within ten (10) days after a Change in Control (or such later date
   that is forty-five (45) days after the notice required by the following
   provisions of this Section 7.a. is provided to the applicable SERP Recipient),
   equal to the actuarial present value of his Future Retirement Benefit,
   calculated using: (x) for each SERP Recipient who was (or whose benefit is
   applicable to a Vested Participant who was) a Vested Participant on January 1,
   1998, (i) the 83 GAM mortality tables; and (ii) an interest rate equal to the
   PBGC Interest Rate as of the date of the Change in Control; and (y) for each
   SERP Recipient who first became (or whose benefit is the result of a Vested
   Participant who first became) a Vested Participant after January 1, 1998, (i)
   the prevailing commissioner's standard mortality table (described in Section
   807(d)(5)(A) of the Internal Revenue Code of 1986, as amended from time to time)
   used to determine reserves for group annuity contracts issued on the date of the
   Change in Control (without regard to any other subparagraph for such Section
   807(d)(5)) that is prescribed by the Commissioner of the Internal Revenue
   Service in revenue rulings, notices, or other guidance published in the Internal
   Revenue Bulletin; and (ii) an interest rate equal to the Lump Sum Interest Rate
   as of the date of the Change in Control. Notwithstanding anything in this
   paragraph to the contrary, the lump sum cash value of the benefit described in
   this Section 7.a. for each SERP Recipient who was, or whose
   
   
   
   benefit is applicable to a Vested  Participant who (A) was a Vested  Participant
   as of January 1, 1998 and (B) whose  employment with the Corporation  terminated
   on or after  January 1, 2002,  shall be equal to the greater of the value of the
   lump sum cash payment calculated  pursuant to the rates and factors set forth in
   subsections (x) or (y) of this paragraph.
   
                  Notwithstanding the foregoing, the provisions of this Section
   7.a. shall not apply with respect to a SERP Recipient unless such SERP Recipient
   consents to the application of this Section 7.a. within thirty (30) days after
   the date the SERP Recipient receives written notice of the terms of this Section
   7.a., as provided for by the following sentences. The Corporation shall provide
   each SERP Recipient with a written notice of the terms of this Section 7.a. and
   the consent requirement contained herein not later than five (5) days after the
   earliest of (y) the date that the Corporation provides notice to its
   stockholders that a vote on a transaction which, if consummated, would
   constitute a Change in Control will be submitted to the Corporation's
   stockholders for approval, or (z) the occurrence of a Change in Control.
   
                 b. For purposes of Sections 7 and 10, a "Change in Control" means:
   
                    (1)  Individuals who, on June 8, 1999, constitute the Board
            (the "Incumbent Directors") cease for any reason to constitute at
            least a majority of the Board, provided that any person becoming a
            director subsequent to June 8, 1999, whose election or nomination for
            election was approved by a vote of at least two-thirds (2/3) of the
            Incumbent Directors then on the Board (either by specific vote or by
            approval of the proxy statement of the Corporation in which such person
            is named as nominee for director, without written objection to such
            nomination) shall be an Incumbent Director; PROVIDED, HOWEVER, that no
            individual initially elected or nominated as a director of the
            Corporation as a result of an actual or threatened election contest (as
            described in Rule 14a-11 under the Exchange Act) ("Election Contest")
            or other actual or threatened solicitation of proxies or consents by or
            on behalf of any Person other than the Board ("Proxy Contest"),
            including by reason of any agreement intended to avoid or settle any
            Election Contest or Proxy Contest, shall be deemed an Incumbent
            Director; and PROVIDED FURTHER, HOWEVER, that a director who has been
            approved by the Hershey Trust while it beneficially owns more than 50%
            of the combined voting power of the then outstanding voting securities
            of the Corporation entitled to vote generally in the election of
            directors (the "Outstanding Company Voting Power") shall be deemed to
            be an Incumbent Director;
   
                     (2) The acquisition or holding by any Person of
            beneficial ownership (within the meaning of Section 13(d) under the
            Exchange Act and the rules and regulations promulgated thereunder) of
            shares of the Common Stock and/or the Class B Common Stock of the
            Corporation representing 25% or more of either (i) the total number of
            then outstanding shares of both Common Stock and Class B Common Stock
            of the Corporation (the "Outstanding Company Stock") or (ii) the
            Outstanding Company Voting Power; provided that, at the time of such
            acquisition or holding of beneficial ownership of any such shares, the
            Hershey Trust does not beneficially own more than 50% of the
            Outstanding Company Voting Power; and provided, further, that any such
            acquisition or holding of beneficial ownership of shares of either
            Common
   
   
   
            Stock or Class B Common Stock of the Corporation by any of the
            following entities shall not by itself constitute such a Change in
            Control hereunder: (i) the Hershey Trust; (ii) any trust established by
            the Corporation or by any Subsidiary for the benefit of the Corporation
            and/or its employees or those of a Subsidiary; (iii) any employee
            benefit plan (or related trust) sponsored or maintained by the
            Corporation or any Subsidiary; (iv) the Corporation or any Subsidiary
            or (v) any underwriter temporarily holding securities pursuant to an
            offering of such securities;
   
                    (3)  The approval by the stockholders of the
            Corporation of any merger, reorganization, recapitalization,
            consolidation or other form of business combination (a "Business
            Combination") if, following consummation of such Business Combination,
            the Hershey Trust does not beneficially own more than 50% of the total
            voting power of all outstanding voting securities eligible to elect
            directors of (x) the surviving entity or entities (the "Surviving
            Corporation") or (y) if applicable, the ultimate parent corporation
            that directly or indirectly has beneficial ownership of more than 50%
            of the combined voting power of the then outstanding voting securities
            eligible to elect directors of the Surviving Corporation; or
   
                    (4)  The approval by the stockholders of the
            Corporation of (i) any sale or other disposition of all or
            substantially all of the assets of the Corporation, other than to a
            corporation (the "Acquiring Corporation") if, following consummation of
            such sale or other disposition, the Hershey Trust beneficially owns
            more than 50% of the total voting power of all outstanding voting
            securities eligible to elect directors (x) of the Acquiring Corporation
            or (y) if applicable, the ultimate parent corporation that directly or
            indirectly has beneficial ownership of more than 50% of the combined
            voting power of the then outstanding voting securities eligible to
            elect directors of the Acquiring Corporation, or (ii) a liquidation or
            dissolution of the Corporation.
   
                     c.  For purposes of Sections 7 and 10, a "Potential Change in
   Control" means:
   
                         (1) The Hershey Trust by action of any of the Board
            of Directors of Hershey Trust Company; the Board of Managers of Milton
            Hershey School; the Investment Committee of the Hershey Trust; and/or
            any of the officers of Hershey Trust Company or Milton Hershey School
            (acting with authority) undertakes consideration of any action the
            taking of which would lead to a Change in Control as defined herein,
            including, but not limited to consideration of (i) an offer made to the
            Hershey Trust to purchase any number of its shares in the Corporation
            such that if the Hershey Trust accepted such offer and sold such number
            of shares in the Corporation the Hershey Trust might no longer have
            more than 50% of the Outstanding Company Voting Power, (ii) an offering
            by the Hershey Trust of any number of its shares in the Corporation for
            sale such that if such sale were consummated the Hershey Trust might no
            longer have more than 50% of the Outstanding Company Voting Power or
            (iii) entering into any agreement or understanding with a person or
            entity that would lead to a Change in Control; or
   
   
                         (2) the Board approves a transaction described in
            subsection (2), (3) or (4) of the definition of a Change in Control
            contained in Section 7.b.
   
                     d.  For purposes of this Section 7: (i) "Hershey Trust" means
   either or both of (a) the Hershey Trust Company, a Pennsylvania corporation, as
   Trustee for the Milton Hershey School, or any successor to the Hershey Trust
   Company as such trustee, and (b) the Milton Hershey School, a Pennsylvania
   not-for-profit corporation; (ii) "Exchange Act" shall mean the Securities
   Exchange Act of 1934 and the rules and regulations promulgated thereunder; (iii)
   "Person" shall have the meaning given in Section 3(a)(9) of the Exchange Act, as
   modified and used in Sections 13(d)(3) and 14(d) thereof; and (iv) "Subsidiary"
   shall mean any corporation controlled by the Corporation, directly or
   indirectly.
   
            8.    PAYMENT OF BENEFITS.
   
                  a. Nothing contained in the Plan and no action taken pursuant
   to the provisions of the Plan shall create or be construed to create a trust of
   any kind, or a fiduciary relationship between the Corporation and any
   Participant, Vested Participant, spouse of a Participant or Vested Participant,
   or any other person. No person other than the Corporation shall by virtue of the
   provisions of the Plan have any interest in such assets. To the extent that any
   person acquires a right to receive payments from the Corporation under the Plan,
   such right shall be no greater than the right of any unsecured general creditor
   of the Corporation. The right of any Vested Participant or any other person to
   the payment of benefits under the Plan shall not be assigned, transferred,
   pledged or encumbered; such payments and the right thereto are expressly
   declared to be non-assignable and nontransferable. No payments hereunder shall
   be subject to the claim of the creditors of any Vested Participant or of any
   other person entitled to payments hereunder. Any payments required to be made
   pursuant to the Plan to a person who is under a legal disability may be made by
   the Corporation to or for the benefit of such person in such of the following
   ways as the Committee shall determine:
   
                  1.     directly to such person.
                  2.     to the legal representative of such person.
                  3.     to a near relative of such person to be used for such
                         person's benefit.
                  4.     directly in payment of expenses of support, maintenance
                         or education of such person.
   
                  The Corporation shall not be required to see to the
   application by any third party of any payments made pursuant to the Plan.
   
                  b. The Committee may, in its discretion, suspend or terminate
   the benefits provided by the Plan to any Vested Participant, the spouse of such
   Vested Participant or any other person succeeding to the interests under the
   Plan of such Vested Participant, who first receives benefit payments under the
   Plan after March 1, 2003 if such Vested Participant (i) was not a Vested
   Participant under the Plan on March 1, 2003; and (ii) engaged in any conduct or
   misconduct while employed by the Corporation that the Committee reasonably
   determines constitutes Cause under the Plan. Such suspension or termination of
   benefits shall apply prospectively from and after the date of the Committee's
   determination that such conduct or
   
   
   
    misconduct constitutes Cause.
   
            9.    EFFECTIVE DATE OF PLAN. This Amended and Restated (2003)
   Supplemental Executive Retirement Plan shall be effective March 1, 2003 and
   Vested Participants who become eligible to retire under the Plan on or after
   that date shall be entitled to the benefits provided hereunder.
   
            10.   AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN. The Board of
   Directors of the Corporation may, at any time, suspend or terminate the Plan.
   The Board, or its duly appointed delegee, if applicable, may also from time to
   time, amend the Plan in such respects as it may deem advisable in order that
   benefits provided hereunder may conform to any change in law or in other
   respects which the Board, or its delegee in accordance with the Board's
   delegation of authority thereto, deems to be in the best interest of the
   Corporation. No such suspension, termination or amendment of the Plan shall
   adversely affect any right of any person who is a Vested Participant at the time
   of such suspension, termination or amendment or his beneficiary(ies), estate or
   surviving spouse, as applicable, to receive benefits under the Plan in
   accordance with its provisions in effect immediately prior to such suspension,
   termination or amendment without the consent of such Vested Participant,
   beneficiary(ies), estate or surviving spouse. Any benefits payable under the
   terms of the Plan at the time of any suspension, termination or amendment of the
   Plan shall remain in effect according to their original terms, or such alternate
   terms as may be in the best interests of both parties and agreed to by the
   Vested Participant or his beneficiaries, estate or surviving spouse, as
   applicable. Notwithstanding the foregoing, (a) the Plan may not be terminated or
   amended in any manner that is adverse to the interests of a Participant or the
   surviving spouse of a Participant without the consent of the Participant or
   surviving spouse, as applicable, either: (i) after a Potential Change in Control
   occurs and for one (1) year following the cessation of the Potential Change in
   Control, or (ii) for a two (2) year period beginning on the date of a Change in
   Control (the "Coverage Period"); and (b) no termination of this Plan or
   amendment hereof in a manner adverse to the interests of any Participant, or
   such Participant's surviving spouse, (without the consent of the Participant or
   surviving spouse) shall be effective if such termination or amendment occurs (i)
   at the request of a third party who has taken steps reasonably calculated to
   effect a Change in Control, or (ii) in connection with or in anticipation of a
   Change in Control. After the Coverage Period, the Plan may not be amended or
   terminated in any manner that would adversely affect the entitlement of a
   Participant or his surviving spouse (without the consent of the Participant or
   surviving spouse) to benefits that have accrued hereunder. For purposes of the
   immediately preceding two sentences of this Section 10, whether an employee of
   the Corporation qualifies as a Participant shall be determined at the time (a)
   the Coverage Period commences and any time thereafter or (b) his employment is
   terminated or the Plan is amended (i) at the request of a third party who has
   taken steps reasonably calculated to effect a Change in Control, or (ii) in
   connection with or in anticipation of a Change in Control.
   
   
   
            IN WITNESS WHEREOF, Hershey Foods Corporation has caused this Hershey
   Foods Corporation Amended and Restated (2003) Supplemental Executive Retirement
   Plan to be executed as of the 12th day of February, 2003.
   
   
                                   HERSHEY FOODS CORPORATION
   
   
                                   By:            /s/ Marcella K. Arline
                                            --------------------------------------
                                            Marcella K. Arline
                                            Senior Vice President, Human Resources
                                            and Corporate Affairs
   
   
   
   
   
                                      SCHEDULE I
                                          to
                              AMENDED AND RESTATED (2003)
                        SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
   
   
   
   January 2001                       1.310%       January 2003              0.385%
   February 2001                      1.272%       February 2003             0.347%
   March 2001                         1.233%       March 2003                0.308%
   April 2001                         1.195%       April 2003                0.270%
   May 2001                           1.156%       May 2003                  0.231%
   June 2001                          1.118%       June 2003                 0.193%
   July 2001                          1.079%       July 2003                 0.154%
   August 2001                        1.041%       August 2003               0.116%
   September 2001                     1.002%       September 2003            0.077%
   October 2001                       0.964%       October 2003              0.039%
   November 2001                      0.925%       November 2003 and each
   December 2001                      0.887%       succeeding month          0.000%
   
   January 2002                       0.848%
   February 2002                      0.809%
   March 2002                         0.771%
   April 2002                         0.732%
   May 2002                           0.694%
   June 2002                          0.655%
   July 2002                          0.617%
   August 2002                        0.578%
   September 2002                     0.540%
   October 2002                       0.501%
   November 2002                      0.463%
   December 2002                      0.424%
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   

   EXHIBIT 12

   HERSHEY FOODS CORPORATION
   COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
   (in thousands of dollars except for ratios)
   (Unaudited)

                                                                For the Three Months Ended
                                                                --------------------------
                                                               March 30,       March 31,
                                                                 2003            2002
                                                               ----------      ---------
   
   Earnings:
   
   Income before income taxes                                 $  154,120      $ 137,514
   
   Add (deduct):
   
      Interest on indebtedness                                    15,612         16,244
      Portion of rents representative of the
        interest factor (a)                                        3,906          3,525
      Amortization of debt expense                                   112            116
      Amortization of capitalized interest                           962          1,045
                                                                --------        -------
             Earnings as adjusted                             $  174,712      $ 158,444
                                                                ========        =======
   Fixed Charges:
   
      Interest on indebtedness                                $   15,612      $  16,244
      Portion of rents representative of the
       interest factor (a)                                         3,906          3,525
      Amortization of debt expense                                   112            116
      Capitalized interest                                           626            329
                                                                --------        -------
          Total fixed charges                                 $   20,256      $  20,214
                                                                ========        =======
   Ratio of earnings to fixed charges                               8.63           7.84
                                                                ========        =======
   NOTE:
   
   (a)    Portion of rents representative of the interest factor consists of all rental expense
          pertaining to operating leases used to finance the purchase or construction of warehouse
          and distribution facilities, and one-third of rental expense for other operating leases.
   
   

   Exhibit 99

   Certification

   Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned officers of Hershey Foods Corporation (the “Company”) hereby certify that the Company’s quarterly report on Form 10-Q for the three months ended March 30, 2003 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

   A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

    

   Dated:	May  8, 2003	/s/ Richard H. Lenny
   		Richard H. Lenny
   		Chief Executive Officer

    

   Dated:	May  8, 2003	/s/ Frank Cerminara
   		Frank Cerminara
   		Chief Financial Officer