FEDERATED HERMES, INC. (FHI) Business

ITEM 1 – BUSINESS

General

Federated Hermes, Inc., a Pennsylvania corporation, together with its consolidated subsidiaries (collectively, Federated Hermes) is a global leader in active investing with $902.6 billion in assets under management (AUM or managed assets) at December 31, 2025. Federated Hermes has been in the investment management business since 1955 and is one of the largest investment managers in the United States (U.S.). Federated Hermes also provides stewardship services to customers seeking a range of solutions for engagement, as well as real estate development and renewable energy project development services. In seeking to enhance long-term risk-adjusted investment performance, and create long-term financial value/wealth, for its customers and clients (collectively, including intermediaries, customers) consistent with its fiduciary duties and customer objectives, Federated Hermes has taken steps to integrate the proprietary insights from fundamental investment analysis, including governance, environmental and social factors and engagement interactions, into many of the products and strategies it manages.

Federated Hermes operates in one operating segment, the investment management business. Federated Hermes sponsors, markets and provides investment-related services and strategies (collectively, as applicable, strategies) to various investment products, including sponsored investment companies and other funds (Federated Hermes Funds) and Separate Accounts (which include separately managed accounts (SMAs), institutional accounts, sub-advised funds and other managed products) in both domestic and international markets (such products, strategies and other services being, collectively and as applicable, offerings). In addition, Federated Hermes markets and provides stewardship, real estate development and renewable energy project development services to various domestic and international customers. Federated Hermes’ principal source of revenue is investment advisory fees earned by various domestic and foreign subsidiaries pursuant to investment advisory contracts and based primarily upon the AUM of its investment offerings. Domestic advisory subsidiaries are registered as investment advisors under the Investment Advisers Act of 1940 (Advisers Act), while foreign advisory subsidiaries are registered in the U.S. and/or with foreign regulators.

Federated Hermes provides investment advisory services to 176 Federated Hermes Funds as of December 31, 2025. Federated Hermes markets these funds to institutions, banks, broker/dealers, financial intermediaries and other customers who use them to meet the needs of their customers, including, among others, retail investors, corporations and retirement plans. The Federated Hermes Funds are domiciled in the U.S., as well as Ireland, the United Kingdom (U.K.), Luxembourg, Guernsey, Jersey, Australia and the Cayman Islands. Most of Federated Hermes’ U.S.-domiciled funds are registered under the Investment Company Act of 1940 (1940 Act) and under other applicable federal laws. Each U.S.-domiciled registered fund enters into an advisory agreement that is subject to annual approval by the fund’s board of directors or trustees, a majority of whom are not interested persons, as defined under the 1940 Act, of either the funds or Federated Hermes. In general, new advisory agreements for new U.S.-domiciled registered funds and material amendments to such advisory agreements must be approved by a fund’s shareholders. These advisory agreements are generally terminable upon 60 days’ notice to the investment advisor. See Item 1A – Risk Factors – Specific Risk Factors – Potential Adverse Effects of Termination or Failure to Renew Advisory Agreements for additional information on Federated Hermes’ advisory agreements.

Of the 176 Federated Hermes Funds, Federated Hermes’ investment advisory subsidiaries managed as of December 31, 2025, 22 money market funds with $508.4 billion in AUM, 46 equity funds with $55.0 billion in AUM, 52 fixed-income funds with $46.0 billion in AUM, 51 alternative/private markets funds with $12.1 billion in AUM and five multi-asset funds with $2.9 billion in AUM.

As of December 31, 2025, Federated Hermes provided investment strategies to $278.3 billion in Separate Account assets. These Separate Accounts represent assets of government entities, high-net-worth individuals, pension and other employee benefit plans, corporations, trusts, foundations, endowments, sub-advised funds and other accounts or offerings owned or sponsored by third parties. Fees for Separate Accounts are typically based on AUM pursuant to investment advisory agreements that are generally terminable upon notice to the investment advisor (or, in certain cases, after a 30-day, 60-day or similar notice period).

Certain Federated Hermes Funds have adopted distribution plans that, subject to applicable law, provide for payment to Federated Hermes for distribution services. These distribution plans are implemented through distribution agreements between Federated Hermes and the Federated Hermes Funds. Although the specific terms of each such agreement vary, the basic terms of the agreements are similar. Pursuant to these agreements, a Federated Hermes subsidiary acts as underwriter for these funds and distributes shares of the funds primarily through unaffiliated broker/dealers. Each distribution plan and agreement is

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initially approved by the directors or trustees of the respective fund (and, as required by law, a fund’s shareholders) and is reviewed for approval by such directors or trustees annually as required under applicable law.

Federated Hermes also provides a broad range of services to support the operation and administration of the Federated Hermes Funds. These services, for which Federated Hermes receives fees pursuant to agreements with the Federated Hermes Funds, include administrative services and shareholder servicing.

Assets Under Management

Total managed assets represents the total of AUM, which is composed of Federated Hermes Funds and Separate Accounts and represent the balance of AUM at a point in time. Total managed assets for the past two years were as follows:

Average managed assets represent the average balance of AUM during a period of time. Because substantially all revenue and certain components of distribution expense are generally calculated daily based on AUM, changes in average managed assets are typically a key indicator of changes in revenue earned and asset-based expenses incurred during the same period. Average managed assets for the past three years were as follows:

Changes in Federated Hermes’ average asset mix year-over-year across both asset classes and offering types have a direct impact on Federated Hermes’ operating income. Asset mix impacts Federated Hermes’ total revenue due to the difference in the fee rates earned on each asset class and offering type per invested dollar. Generally, advisory fees charged for services provided to multi-asset and equity offerings are higher than advisory fees charged to alternative/private markets and fixed-income offerings, which in turn are higher than advisory fees charged to money market offerings. Likewise, Federated Hermes Funds typically have higher advisory fees than Separate Accounts. Additionally, certain components of distribution expense can vary depending upon the asset class, distribution channel and/or the size or structure of the customer relationship. Federated Hermes generally pays out a larger portion of the revenue earned from managed assets in money market, multi-asset, and fixed-income funds than the revenue earned from managed assets in equity and alternative/private markets funds.

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Revenue

Federated Hermes’ revenue from investment advisory, administrative and other service fees over the last three years were as follows:

Investment Offerings

Federated Hermes offers a wide range of investment offerings, including money market, equity, fixed-income, alternative/private markets and multi-asset offerings. Federated Hermes’ offerings include products and strategies expected to be in demand under a variety of economic and market conditions. Federated Hermes has structured its investment process to meet the requirements of fiduciaries and others who use Federated Hermes’ offerings to meet the needs of their customers. Fiduciaries typically have stringent demands regarding portfolio composition, risk and investment performance.

Federated Hermes, which began selling money market fund offerings to institutions in 1974, is one of the largest U.S. managers of money market assets, with $682.6 billion in AUM at December 31, 2025. Federated Hermes has developed expertise in managing cash for institutions, which typically have strict requirements for regulatory compliance, relative safety, liquidity and competitive yields. Federated Hermes also manages retail money market offerings that are typically distributed through broker/dealers and other financial intermediary customers. At December 31, 2025, Federated Hermes managed money market assets across a wide range of categories: government ($420.5 billion); prime ($242.7 billion); and municipal (or tax-exempt) ($19.4 billion).

Federated Hermes’ equity managed assets totaled $97.9 billion at December 31, 2025 and are managed across a wide range of categories including: value and income ($37.5 billion); growth ($25.3 billion); international/global ($23.2 billion); and blended ($11.9 billion).

Federated Hermes’ fixed-income managed assets totaled $100.1 billion at December 31, 2025 and are managed across a wide range of categories including: multisector ($67.4 billion); high-yield ($11.3 billion); municipal (or tax-exempt) ($7.2 billion); U.S. corporate ($6.8 billion); U.S. government ($5.1 billion); international/global ($1.6 billion); and mortgage-backed ($0.7 billion).

Federated Hermes’ alternative/private markets and multi-asset managed assets totaled $22.0 billion at December 31, 2025 and are managed across a wide range of categories including: real estate ($5.3 billion); private equity ($5.2 billion); private credit ($3.7 billion); multi-asset ($2.9 billion); infrastructure ($2.9 billion) and other alternatives ($2.0 billion).

Investment offerings are generally managed by a team of portfolio managers supported by fundamental and quantitative research analysts. Federated Hermes’ proprietary, independent investment research process is centered on the integration of several qualitative and quantitative disciplines including: fundamental research and credit analysis; integration of proprietary insights from fundamental investment analysis, including governance, environmental and social factors and engagement interactions (for many of Federated Hermes' offerings); quantitative research models; style-consistent and disciplined portfolio construction and management; performance attribution; and trading.

See Note (5) to the Consolidated Financial Statements for information on revenue concentration risk.

Distribution Channels and Product Markets

Federated Hermes’ distribution strategy is to provide investment offerings to more than 11,000 institutions, financial intermediaries and other customers, including, among others, banks, broker/dealers, registered investment advisors, government entities, corporations, insurance companies, foundations and endowments. Federated Hermes uses its trained sales force of nearly 250 representatives and managers, backed by an experienced support staff, to make available and distribute its offerings, add new customer relationships and strengthen and expand existing relationships.

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Federated Hermes’ offerings are made available and distributed in three markets. These markets, and the relative percentage of managed assets at December 31, 2025 attributable to such markets, are as follows: U.S. financial intermediary (68%); U.S. institutional (25%); and international (7%).

U.S. Financial Intermediary Federated Hermes makes available and distributes its offerings in this market through a large, diversified group of over 7,000 national, regional and independent financial intermediary customers, including broker/dealers, banks and registered investment advisors. Financial intermediaries use Federated Hermes’ offerings to meet the needs of their customers, who are often retail investors. Federated Hermes offers a full range of offerings to these customers, including Federated Hermes Funds and Separate Accounts (including private funds). As of December 31, 2025, managed assets in the U.S. financial intermediary market included $491.1 billion in money market assets, $70.3 billion in equity assets, $46.9 billion in fixed-income assets, $2.6 billion in multi-asset and $1.8 billion in alternative/private markets assets.

U.S. Institutional Federated Hermes makes available and distributes its offerings to a wide variety of domestic institutional customers including, among others, government entities, not-for-profit entities, corporations, corporate and public pension funds, foundations, endowments and non-Federated Hermes investment companies or other funds. As of December 31, 2025, managed assets in the U.S. institutional market included $167.9 billion in money market assets, $49.6 billion in fixed-income assets, $7.3 billion in equity assets, $1.2 billion in alternative/private markets assets and $0.2 billion in multi-asset.

International Federated Hermes manages assets from non-U.S. institutional and financial intermediary customers through subsidiaries focused on gathering assets in Europe, the Middle East, Canada, Latin America and the Asia Pacific region. As of December 31, 2025, managed assets in the international market included $23.6 billion in money market assets, $20.3 billion in equity assets, $16.0 billion in alternative/private markets assets and $3.6 billion in fixed-income assets.

Competition

As of December 31, 2025, Federated Hermes had $624.3 billion of Federated Hermes Fund AUM and $278.3 billion of Separate Account AUM. Of the Separate Account AUM, $40.6 billion related to SMAs.

The investment management business is highly competitive across all types of investment offerings, including mutual funds, exchange traded funds (ETFs), SMAs, institutional accounts, sub-advised funds and other managed offerings. Competition is particularly intense among mutual fund and ETF providers. According to the Investment Company Institute (ICI), at the end of 2025, there were over 6,000 open-end mutual funds and over 4,000 ETFs of varying sizes and investment objectives whose shares are currently being offered in the U.S.

In addition to competition from other mutual fund managers, ETF providers and investment advisors, Federated Hermes competes with investment alternatives offered by insurance companies, commercial banks, broker/dealers, deposit brokers, private markets/alternative product managers and other financial institutions. Federated Hermes launched its first ETFs in December 2021 and currently has ten ETFs in its offerings as of December 31, 2025.

Competition for sales of investment offerings is influenced by various factors, including investment performance, attainment of stated objectives, yields and total returns, fees and expenses, advertising and sales promotional efforts, investor confidence and preference, relationships with intermediaries and other customers and type and quality of services.

Regulatory Matters

The business and regulatory environments in which Federated Hermes operates globally remain complex, uncertain and subject to change. Federated Hermes, its investment management business, and offerings are subject to extensive regulation, both within and outside of the U.S. With Federated Hermes’ global operations, Federated Hermes, and certain of its subsidiaries and offerings (such as the Federated Hermes Funds), are registered with or licensed by, and subject to examination by, various U.S. and/or non-U.S. regulators, self-regulatory agencies or exchanges, such as, among others, the U.S. Securities and Exchange Commission (SEC), Financial Industry Regulatory Authority (FINRA), Commodity Futures Trading Commission (CFTC), Department of Labor (DOL), New York Stock Exchange (NYSE), U.K. Financial Conduct Authority (FCA), Central Bank of Ireland (CBI), Cayman Island Monetary Authority (CIMA), Monetary Authority of Singapore, Australian Securities and Investments Commission (ASIC) and Luxembourg Commission de Surveillance du Secteur Financier (CSSF).

Federated Hermes’ business and offerings, are subject to various U.S. and/or non-U.S. laws, regulations, rules, codes, notices, directives, guidelines, listing standards, judicial decisions, orders, circulars and/or conditions (collectively, as applicable, regulatory requirements), including regulatory requirements that impose restrictions, limitations, registration, reporting and disclosure requirements on its business and offerings, and add complexity to its global compliance operations. These include,

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for example: (1) federal securities laws such as the Securities Act of 1933 (1933 Act), the Securities Exchange Act of 1934 (1934 Act), the 1940 Act, Advisers Act, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act), and the Sarbanes-Oxley Act of 2002 (SOX) and related regulations; (2) the NYSE Listed Company Manual; (3) corporate laws regarding governance, reporting, disclosure and other requirements; (4) state or foreign laws regarding securities fraud, securities registration, reporting and escheatment of unclaimed or abandoned property; (5) various privacy, and data protection laws and regulations, such as Regulation S-P in the U.S. and the General Data Protection Regulation (GDPR) of the European Union (EU) and U.K. GDPR; (6) various financial crime laws, such as anti-money laundering, anti-terrorist financing, economic, trade and financial sanctions, both domestically and internationally; (7) various cross-border regulatory requirements, such as the anti-bribery and anti-corruption rules under the Foreign Corrupt Practices Act of 1977 (FCPA) and U.K. Bribery Act 2010; and (8) regulations or other rules promulgated by various regulatory or other authorities. The regulatory requirements applicable to Federated Hermes’ business and offerings also include economic, trade and financial sanctions regulatory requirements, such as the sanctions programs administered by the Office of Foreign Assets Control of the U.S. Department of Treasury (USDT), as well as sanctions programs adopted and administered by non-U.S. jurisdictions where Federated Hermes’ offerings are distributed. Certain regulatory requirements, both in the U.S. and outside the U.S., are extra-territorial. Federated Hermes also must comply with complex and changing tax regimes in the jurisdictions where it operates. Federated Hermes monitors, reviews and assesses proposed new or revised regulatory requirements that are proposed from time to time (collectively, as applicable, regulatory developments). These regulatory requirements and regulatory developments continue to impact the investment management industry generally, and will continue to impact, to various degrees, Federated Hermes’ business, results of operations, financial condition, cash flows, stock price and reputation (collectively, Financial Condition). Please see Federated Hermes’ prior public filings, including the discussions under Part 1, Item 2 – Management’s Discussion and Analysis – Business Developments – Current Regulatory Developments, in Federated Hermes’ Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2025, June 30, 2025, and September 30, 2025 for an overview of Federated Hermes’ regulatory environment and related key regulatory developments and requirements for periods prior to September 30, 2025. See also Item 1A – Risk Factors – General Risk Factors – Regulatory and Legal Risks – Potential Adverse Effects of Changes in Laws, Regulations and Other Regulatory Requirements for additional information.

Current Regulatory Environment – Domestic

The legislative and regulatory environment in the U.S. is dynamic. Federated Hermes’ primary regulator in the U.S. is the SEC. The new Presidential administration has fundamentally redirected the SEC away from expansive regulation and aggressive enforcement since taking office in January 2025, emphasizing deregulation, capital formation and “back-to-basics” investor protection. This shift has occurred rapidly through executive orders, SEC leadership changes and the number and type of SEC enforcement actions during 2025.

Upon returning to office, the President issued two executive orders asserting broader presidential authority over federal agencies than previous administrations in furtherance of implementing a deregulatory agenda. For instance, on January 20, 2025, the President issued an executive order implementing a regulatory freeze pending review of existing proposed regulations. On February 18, 2025, the President issued another executive order changing the manner in which federal agencies promulgate new regulations. Under this executive order, all independent agencies, such as the SEC, are required to submit proposed new regulations to the White House Office of Information and Regulatory Affairs (White House) for review (except for monetary functions of the Board of Governors of the Federal Reserve System (Federal Reserve)) and must consult with the White House on their priorities and strategic plans. These executive orders, coupled with a 15% reduction in the SEC’s workforce from the previous administration, have led to a slower pace of SEC proposals and final regulations in 2025.

The SEC had one of its most active rulemaking years in 2024, while 2025 saw far fewer new proposals, a significant reduction in finalized substantive rules, and a large-scale withdrawal of pending proposals. For instance, in 2024, the SEC planned to finalize approximately 18 major rules across investment management, public company disclosure, governance, environmental, and social disclosure, cybersecurity, market structure and private funds. Moreover, the SEC’s Regulatory Flex Agenda in 2024 routinely contained 30-40 active items, reflecting a sustained pipeline of proposed and final rules. By contrast, 2025 saw pronounced deceleration, with the SEC’s Spring Regulatory Flex Agenda in 2025 listing only 23 items scheduled for action in the next 12 months, down significantly from the Fall Regulatory Flex Agenda in 2024 and far below historical averages. In 2024, the SEC finalized numerous substantive rules, while final rules issued in 2025 were predominantly technical amendments, compliance-date extensions, delegations of authority and procedural or administrative items. In 2025, the SEC also formally abandoned many inherited initiatives, including withdrawing proposals on governance, environmental, and social disclosures, cybersecurity risk management, predictive data analytics, investment advisor outsourcing oversight and climate-related disclosures.

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The SEC’s enforcement actions in fiscal year 2025 also declined compared to previous years. For instance, in 2025, the SEC initiated 313 total new enforcement actions, a 27% decrease from fiscal year 2024. Moreover, the SEC initiated only four enforcement actions against public companies during 2025. Total monetary settlements decreased by 45% to $808 million, which is the lowest annual total since fiscal year 2012 and less than half of the fiscal year 2014 to 2024 average $1.9 billion in total annual settlements. During 2025, the SEC shifted its focus toward traditional enforcement areas, such as insider trading and fraud, and away from novel areas like cryptocurrency.

On November 17, 2025, the SEC announced that its 2026 examination priorities will be focused on advancing compliance, preventing fraud, informing policy decisions and monitoring risk. Examination topics of focus include, among other topics: (1) investment advisor fiduciary duty and standards of conduct, including adherence to the duty of care and duty of loyalty and conflicts of interest; (2) investment advisor compliance program effectiveness; (3) recently registered investment advisors and investment advisors that have never been examined; (4) registered investment company compliance programs, disclosures, filings and governance practices, with focus on fund fees and expenses, portfolio management practices and disclosures; (5) broker-dealer financial responsibility rules; (6) broker-dealer trading-related practices and services; (7) broker-dealer retail sales practices, including compliance and regulation best interest; (8) self-regulatory organizations, such as national securities exchanges, FINRA and the Municipal Securities Rulemaking Board; (9) clearing agencies; (10) other market participants, such as municipal advisors, transfer agents, funding portals, security-based swap dealers and security-based swap execution facilities; and (11) risk areas impacting various market participants, such as cybersecurity, Regulation S-ID and Regulation S-P, emerging financial technology, regulation systems compliance and integrity, and anti-money laundering. The SEC has emphasized that its published examination priorities are not an exhaustive list, and examination priorities may shift in response to new or emerging risks, products and services, market events or investor concerns.

On December 11, 2025, the Financial Stability Oversight Council (FSOC) issued its 2025 Annual Report. In contrast to its previous annual reports, FSOC focused on deregulation to promote economic growth. The 2025 Annual Report was accompanied by an introductory letter written by the U.S. Secretary of the Treasury, which focused on the importance of economic growth and economic security to promote financial stability. The Treasury Secretary announced that FSOC “will work with and support [its] member agencies in considering whether aspects of the U.S. financial regulatory framework impose undue burdens and negatively impact economic growth.” And in contrast to last year’s report, which focused on 14 “risks” and “vulnerabilities,” the 2025 Annual Report discusses four “key areas of focus” for the upcoming year: (1) bolstering the Treasury market; (2) strengthening cybersecurity; (3) enhancing supervisory and regulatory frameworks for depository institutions; and (4) using artificial intelligence (AI) to strengthen financial stability.

On December 9, 2025, FINRA published its “2026 FINRA Annual Regulatory Oversight Report” (FINRA 2026 Report), which purports to provide insight into findings from FINRA’s regulatory operations programs. In the FINRA 2026 Report, FINRA focuses on regulatory obligations, examination observations, and effective practices in a number of areas, including, for example: (1) generative AI, including continuing and emerging trends; (2) financial crimes prevention, including cybersecurity and cyber-enabled fraud, anti-money laundering, fraud and sanctions, and manipulative trading; (3) firm operations; (4) cryptocurrency; (5) communications and sales; (6) market integrity; and (7) financial management. In the FINRA 2026 Report, FINRA notes that “firms may consider the information in this Report in developing new, or modifying existing, compliance practices.”

Please see Federated Hermes’ prior annual and periodic SEC filings for additional information regarding other U.S. regulatory developments and regulatory requirements that can impact Federated Hermes and its offerings. These include, among others: (1) money market fund reforms; (2) open-end mutual funds and liquidity management; (3) amendments to Rule 35d-1 under the 1940 Act (Names Rule); (4) amendments to broker-dealer FOCUS reports; (5) the Federal Trade Commission’s (FTC) decision to end defense of its noncompete ban, which was struck down by a Federal District Court in Texas, and new enforcement initiatives; (6) tailored shareholder reports; (7) amendments to Form PF; (8) share repurchase disclosure modernization, which was vacated by the U.S. Court of Appeals for the Fifth Circuit; (9) the impact of several recent court decisions that impact the regulation of the investment management industry, including, among other things, the potential ability to challenge regulation, the SEC’s ability to bring enforcement actions seeking civil penalties, and the validity of certain final rules adopted by the SEC; (10) executive orders impacting the investment management industry; (11) customer identification programs for investment advisors; and (12) recent actions by state attorneys general and financial officers impacting governance, environmental and social framework-aligned investment strategies and climate disclosure groups.

In addition to the above matters, key recent regulatory requirements and regulatory developments in the U.S. since September 30, 2025, that can significantly impact or relate to Federated Hermes’ business and offerings include, among others, the following. Unless otherwise noted, Federated Hermes is evaluating the impact of the matters described on its business and offerings.

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Proposed Amendments to Form N-PORT Reporting; Extension of Compliance Dates for Names Rule Reporting. On February 18, 2026, the SEC proposed amendments to certain registered investment company reporting requirements on Form N-PORT to: (1) provide funds with an additional 15 days to file monthly reports of portfolio-related information; (2) reduce the publication of reports from monthly to quarterly; (3) streamline or remove certain reported information; and (4) require certain additional information for funds, including certain identifying information and information about funds with share classes that operate as ETFs. The SEC also extended the compliance dates for amendments to Form N-PORT that relate to the Names Rule to November 17, 2027, for fund groups, such as the Federated Hermes Funds, with net assets of $10 billion or more as of the end of their most recent fiscal year, and to May 18, 2028, for fund groups with less than $10 billion in net assets as of the end of their most recent fiscal year. The public comment period on the proposed Form N-PORT amendments will end on the date that is 60 days after the proposal is published in the Federal Register.

SEC Frequently Asked Questions (FAQs) on the Names Rule. On February 18, 2026, the SEC issued additional FAQs on the Names Rule. The FAQs related to: (1) shareholder notice of certain changes to non-fundamental 80% investment policies; (2) the Names Rule’s treatment of unfunded commitments for certain funds; (3) the use of “Growth” or “Value” in certain fund names; and (4) the use of “Merger” or “Merger Arbitrage” in fund names.

SEC Chairperson Testifies that the SEC is Open for Certain Additional Money Market Fund Reforms. On February 11, 2026, the SEC Chairperson testified before the U.S. House of Representatives Financial Services Committee in respect of the mandatory redemption fee required under the SEC’s 2023 money market fund reforms that “[a]ll these things are open” and “[y]es, we’re looking at all of these things.” In response to a letter from a member of the Financial Services Committee, the SEC Chairperson indicated that the SEC Staff is working with the fund industry on provisions in Rule 2a-7 under the 1940 Act that require liquidity fees on institutional prime and institutional municipal (tax-exempt) money market funds when they reach a certain threshold of investor redemptions. Federated Hermes previously submitted letters to the SEC Chairperson on April 28, 2025 and July 11, 2025, in which Federated Hermes expressed its view that the SEC’s adoption of the 2023 amendments to Rule 2a-7 under the 1940 Act related to the mandatory liquidity fee framework for institutional prime and institutional municipal (tax-exempt) money market funds violated the Administrative Procedures Act and should be repealed. Federated Hermes believes this violation stems from the SEC’s failure to conduct a proper cost-benefit analysis, the establishment of an arbitrary threshold for mandatory liquidity fees, the absence of an analysis of less restrictive alternatives, and the lack of adequate notice and opportunity for public comment.

SEC FAQs on Net Performance and Promotor Disqualification. On January 15, 2026, the SEC published two new FAQs aimed at addressing challenges faced by investment advisors complying with Rule 206(4)-1 under the Advisers Act (Marketing Rule). The Marketing Rule permits investment advisors to calculate net performance applying either actual or model fees. Despite this apparent flexibility in the rule, footnote 590 of the Marketing Rule Adopting Release states that if the fees charged to the intended audience of an advertisement are anticipated to be higher than the actual fees used to calculate net performance, the investment advisor “must use a model fee that reflects the anticipated fee to be charged in order not to violate the rule’s general prohibitions.” The new FAQ clarifies that the guidance in footnote 590 should be interpreted through the lens of the Marketing Rule’s general prohibitions, which are intended to “provide appropriate flexibility and regulatory certainty for investment advisors considering how to market their investment advisory services” and “[i]n applying the general prohibitions, an investment advisor should consider the facts and circumstances of each advertisement.” In the SEC Staff’s view, whether the use of actual fees violates the general prohibitions depends on all of the facts and circumstances of a specific advertisement, including, but not limited to, relevant disclosures. The SEC Staff’s view is that investment advisors can use various means to illustrate the effect of differences between actual fees and anticipated fees on performance. This guidance provides welcome relief for investment advisors that have struggled to apply the prescriptive language in footnote 590 to various forms of investment performance. The second FAQ provides guidance on circumstances in which investment advisors can engage certain persons to provide testimonials or endorsements.

SEC Chairperson Issues Statement on Reforming Regulation S-K. On January 13, 2026, the Chairperson of the SEC stated that: “[t]oday, the disclosure that companies provide in response to the myriad requirements of Regulation S-K does not always reflect information that a reasonable investor would consider important in making an investment or voting decision.” Towards the goal of eliminating requirements to disclose “undisputably immaterial information,” the Chairperson has instructed the SEC’s Division of Corporation Finance to undertake a comprehensive review of Regulation S-K. He noted that this process began in May 2025, with the solicitation of public comments on the executive compensation disclosure requirements of Regulation S-K, Item 402. The SEC Staff is evaluating the comments received with respect to Item 402 of Regulation S-K and is preparing revision recommendations. The SEC will now focus on the other Regulation S-K disclosure requirements “with the goal of revising the requirements to focus on eliciting disclosure of material information and avoid compelling the disclosure of immaterial information.” As part of this effort, the SEC has requested that public comments be submitted by April 13, 2026.

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Proposal to Eliminate Annual Shareholder Meetings for Exchange Listed Closed-End Funds (CEFs) Withdrawn . On December 12, 2025, Cboe Global Markets Inc. (Cboe) withdrew its May 20, 2025 proposal (Cboe Proposal) that would have exempted newly-listed CEFs from the requirement to hold annual shareholder meetings and, subject to shareholder approval, also would have exempted previously listed CEFS from the annual shareholder meeting requirement. The SEC was originally expected to decide on the Cboe Proposal by December 2025, but extended the review period to February 2026, signaling unresolved concerns. On January 5, 2026, the NYSE withdrew a similar June 6, 2025 proposal to exempt newly listed CEFs and, subject to shareholder approval, previously listed CEFs from the annual shareholder meeting requirement. The withdrawals by the Cboe and NYSE terminated their rulemaking efforts before a final SEC decision. While Federated Hermes is not currently aware of any plan by the NYSE or Cboe to revise or resubmit their Proposals, it is possible that the Texas Stock Exchange could submit its own proposal to exempt newly-listed CEFs from the annual shareholder meeting requirement. Federated Hermes fully supported efforts to eliminate annual shareholder meetings for exchange listed CEFs because, in Federated Hermes’ view, CEFs are more akin to registered mutual funds, which are not required to have annual meetings, than listed operating companies and the annual shareholder meeting requirement subjects them to attack by activist shareholders who buy discounted shares and then take action to force the CEFs to incur liquidity events (such as tender offers, reorganizations, or open-ending of the CEFs) to realize or arbitrage the difference between the discounted purchase prices and the CEFs’ net asset value (NAV), all to the detriment of the CEFs and their long-term investors.

Regulation of Proxy Advisors. On December 11, 2025, the President issued an executive order titled “Protecting American Investors From Foreign-Owned and Politically-Motivated Proxy Advisors.” The executive order states that certain proxy advisory firms wield too much influence (including with respect to corporate governance, shareholder proposals, retirement investing, etc.) and are using that influence “to advance and prioritize radical politically-motivated agendas” related to diversity, equity, and inclusion and governance, environmental, and social issues. The executive order aims to increase federal oversight over the proxy advisory industry by directing: (1) the SEC to conduct a comprehensive review of the existing regulatory framework governing proxy advisors; (2) the FTC to examine ongoing state antitrust investigations involving proxy advisors and determine whether they engage in unfair methods of competition; and (3) the DOL to assess Employee Retirement Income Security Act regulations to ensure “proxy advisors act solely in the financial interests of plan participants.” The new directives signal that federal oversight of both proxy advisors and the institutional investors who rely on them will likely intensify, with a shift toward higher transparency expectations, potential enforcement activity, and closer review of voting rationales involving anything other than strictly financial considerations.

FSOC Considering Revision to Nonbank Designation Guidance. On December 11, 2025, FSOC met in executive and open sessions to discuss several priority initiatives for 2026. Among other topics, FSOC discussed potential changes to the current interpretive guidance regarding nonbank financial company determinations and the framework for financial stability risk identification, assessment and response, which were adopted in November 2023. Under this guidance, FSOC can designate certain non-bank financial companies as systematically important financial institutions (SIFI), which are subject to supervision and regulation by the Federal Reserve. While the new guidance was purportedly intended to provide greater transparency to the public about how FSOC identifies, assesses, and addresses potential risks to financial stability, regardless of whether the risk stems from activities, individual firms or otherwise, it had the effect of potentially bringing a wider range of companies within the Federal Reserve’s jurisdiction, including potentially money market funds and other investment companies. In connection with the December 11, 2025 FSOC meeting, the SEC Chairperson issued a statement indicating that he “was especially encouraged to see revising the nonbank designation guidance on the agenda” and stated that the current guidance creates the risk of arbitrary designation, creating significant regulatory risk for companies not engaged in traditional banking businesses. If Federated Hermes or a Federated Hermes Fund were designated as a SIFI, among other things, they would become subject to enhanced regulatory requirements and direct supervision by the Federal Reserve, which could result in increased operating and compliance costs and potentially restrict business activities. Accordingly, Federated Hermes strongly encourages the FSOC to revise the 2023 nonbank designation guidance to eliminate the risk of money market funds or other investment companies being designated as a SIFI.

Investment Company Institute Recommendations for a Default E-Delivery Framework. On November 18, 2025, the ICI submitted a letter to the SEC providing recommendations and data in support of SEC rulemaking that would allow funds to deliver documents to shareholders electronically on a default basis, rather than requiring shareholders to affirmatively opt in to electronic delivery. In the letter, the ICI articulated the numerous benefits of e-delivery to investors, including better alignment with evolving investor preferences, enhanced investor protection and a better investor experience, cost savings for funds and shareholders, and reduced waste and supply chain concerns. Federated Hermes strongly supports the ICI’s position and believes adoption of e-delivery on a default basis is in the best interest of shareholders. On February 11, 2026, the SEC Chairperson testified before the U.S. House of Representatives Financial Services Committee that he has instructed the SEC Staff to work on a proposed rule that would make e-delivery the default option for delivering fund disclosures to investors.

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Scrutiny of Governance, Environmental and Social Initiatives. Recent state and federal actions highlight continuing scrutiny of governance, environmental and social framework aligned investment strategies and climate disclosure groups.

FTC Investigates Major Proxy Advisory Firms over Antitrust Concerns. It has been reported that the FTC has launched an investigation into two major proxy advisory firms for potential violations of antitrust laws by guiding shareholders on politically sensitive votes. The probe, which remains in its early stages, follows intensified Republican scrutiny from both the House Judiciary Committee and Senate Banking Committee over potential conflicts of interest and political bias in the firms’ recommendations.

Florida Attorney General Sues Proxy Advisory Firms for Deceiving Investors and Manipulating Corporate Governance. On November 20, 2025, the Florida Attorney General filed a lawsuit against two major proxy advisory firms targeting alleged “anticompetitive” conduct. The complaint alleges that the two firms “deceived” investors and weaponized their influence to “impose [a] radical ideological agenda” on American companies and Florida consumers, through the use of “lockstep” voting that stifles competition and harms shareholders.

Nonprofits Challenge Texas Senate Bill (S.B.)2337. On November 10, 2025, a coalition of Texas nonprofits filed a lawsuit challenging Texas S.B. 2337 (which was enacted to regulate proxy advisor firms that provide recommendations involving governance, environmental and social factors or diversity, equity and inclusion factors), arguing that the law violates the First and Fourteenth Amendments to the U.S. Constitution. The plaintiffs contend that the statute’s requirement to label any advice incorporating governance, environmental and social factors or diversity, equity and inclusion factors or other “nonfinancial” considerations as unrelated to shareholders’ financial interests constitutes unconstitutional compelled speech—including for faith-based investors whose recommendations are grounded in religious values. They further argue that the law is overly broad and vague, risking penalties for a wide range of nonprofits and smaller organizations engaged in shareholder advocacy, investment research, or public education. The lawsuit follows an earlier injunction obtained by major proxy advisory firms, marking an escalation in legal challenges to Texas’s anti-governance, environmental and social regulatory framework.

Current Regulatory Environment – International

Like the U.S., the legislative and regulatory environment outside the U.S. is dynamic. Federated Hermes’ primary regulators outside the U.S. include the FCA in the U.K. and the CBI in Ireland. Depending upon where Federated Hermes is doing business, or distributing or marketing its offerings, other regulators in other jurisdictions outside the U.S. can also regulate Federated Hermes and its business and offerings. Consequently, regulatory developments and regulatory requirements promulgated, or recommended, by, among others, the European Commission, European Securities and Markets Authority (ESMA), Bank of England (BoE), His Majesty’s Treasury (HMT), FCA, CBI, CIMA, Monetary Authority of Singapore, ASIC, CSSF, Financial Stability Board (FSB), and International Organization of Securities Commission (IOSCO) can apply to or impact Federated Hermes and its business and offerings.

The pace of proposed and new regulatory developments and regulatory requirements outside the U.S. continued throughout 2025 and is expected to continue in 2026. In the U.K., in its Annual Work Programme for 2025/26 published on April 8, 2025, the FCA reaffirmed its goal to deliver on the public commitments set out in its five-year strategy for 2025 to 2030. The FCA stated that in 2025 to 2026 it expects to focus on: (1) improving regulatory efficiency and enhancing its supervision model by continuing to digitize the FCA authorization process and reduce regulatory burdens for firms; (2) putting consumers’ needs first, which will include further work on embedding the Consumer Duty that took effect in July 2023; and (3) supporting the U.K.’s economic growth by implementing a new prospectus regime, considering more options for the payment of investment research by asset managers and enhancing productivity through the increased encouragement of digitized initiatives such as fund tokenization.

In the EU, ESMA’s 2026 Work Programme for the investment management sector was published on October 3, 2025. ESMA’s 2026 Work Programme focuses on financial stability, risk assessment, effective supervision, sustainability in investment management, effective use of technological innovation, retail consumer protection, and further work on regulating governance, environmental and social rating providers. This is reflected in the regulatory priorities outlined by national regulators, including the CBI. On February 28, 2025, the CBI disclosed that its key regulation and supervision priorities include, among other areas, (1) assessing and managing risks to the financial and operational resilience of firms; (2) addressing systemic risks generated by non-banks; (3) finalizing the revised Consumer Protection Code and the Individual Accountability Framework; (4) ensuring that the EU Anti-Money Laundering Plan results in a consistent and robust EU-wide framework; (5) enhancing digital operational resilience and implementing changes to the fitness and probity process for the firms it supervises; (6) strengthening the resilience of the financial system to climate risks; (7) preparing for the EU Artificial Intelligence Act with further engagement with the use of AI in financial services; and (8) implementing the Markets in Crypto Assets Regulation.

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Please see Federated Hermes’ prior annual and periodic SEC filings for additional information regarding other non-U.S. regulatory developments and regulatory requirements that can impact Federated Hermes and its offerings. These include, among others: (1) money market fund reform initiatives in the U.K., EU, and internationally; (2) U.K. and EU sustainability disclosure and related requirements; (3) EU regulatory developments such as the EU Retail Investment Package, review of the EU Undertakings for the Collective Investment in Transferable Securities (UCITS) Eligible Assets Directive (EAD), and the Digital Operational Resilience Act; and (4) U.K. regulatory developments such as the U.K. Overseas Funds Regime, and the re-introduction of the possibility of bundling investment research costs.

In addition to the above matters, key recent regulatory requirements and regulatory developments outside the U.S. since September 30, 2025, that can significantly impact or relate to Federated Hermes’ business and offerings include, among others, the following. Unless otherwise noted, Federated Hermes is evaluating the impact of the matters described on its business and offerings.

U.K. and EU Money Market Fund reform. In the EU, the European Systemic Risk Board published a compliance report on the implementation of its recommendations on the reform of MMFs on February 12, 2025. It is yet to be established whether there will be substantive changes to the EU MMF Regulation following that report. On April 17, 2025, the CBI published a “Notice of Intention on ESMA Guidelines on Stress Testing Scenarios under the Money Market Fund (MMF) Regulation” in which the CBI indicated its expectation of full compliance with ESMA’s updated MMF stress‑testing guidelines, which ESMA published on February 24, 2025 and applied beginning on May 4, 2025. These guidelines, updating 2024 parameters, establish common risk scenarios (credit, interest rate, liquidity, redemption) under Article 28 of the MMFR, and apply to competent authorities, MMFs and managers of MMFs. On January 13, 2026, ESMA published a Final Report titled “Guidelines on stress test scenarios under the MMF Regulation,” which includes updated guidelines and risk parameters, so that managers of MMFs have the information needed to fill in the reporting template mentioned in the MMF Regulation. In the U.K. and EU, public statements regarding progress on reforms of the regulatory regime for MMFs are expected. In the U.K., the FCA and BoE published a joint consultation setting forth their proposals for a post-Brexit MMF regime in the U.K., while HMT consulted on changes to legislation. While the U.K. regime proposed by the FCA and BoE was substantially based on the EU MMF Regulation, certain differences were proposed. As of January 31, 2026, the European Commission has not yet reopened its MMF Regulation file.

U.K. FCA Consultation Paper 25/36 on Client Categorization and Conflicts of Interest. The FCA issued a consultation paper on proposed changes to the elective professional client categorization rules concerning the qualitative tests required for these types of clients to be considered professional clients. The consultation closed on February 2, 2026.

EU UCITS – Review of eligible assets. The EU is assessing whether to make changes to the EAD, which sets out the types of investments that can be acquired by an EU UCITS and the applicable requirements. On June 26, 2025, ESMA published its technical advice to the European Commission regarding its review of the EAD. Key changes proposed by ESMA include: (1) applying a look-through approach to determine the eligibility of assets that UCITS can invest in to address circumstances where a UCITS acquires exposure to an ineligible asset class by investing in an eligible wrapper; (2) requiring an assessment of the liquidity of individual assets (in addition to portfolio level liquidity monitoring); and (3) relaxing some aspects of the rule permitting up to 10% of assets to be invested in assets that do not meet the standard eligibility requirements and that would not be subject to the look-through assessment. The European Commission is considering ESMA’s technical advice, plans to issue public consultations and market analysis in 2026, and will decide whether to move forward with legislation.

Liquidity risk management for open-end funds. The regulatory requirements relating to liquidity risk management for open-end funds continue to be refined in the EU and U.K. Those developments are occurring in the context of the ongoing international efforts to enhance and harmonize liquidity risk management requirements for collective investment schemes. These include updates to the Recommendations for Liquidity Risk Management originally published and developed by IOSCO in 2018, with IOSCO publishing its final report on revisions to those recommendations on May 27, 2025. In the EU, changes are being made to the requirements regarding liquidity risk management for UCITS and open-ended alternative investment funds (AIFs) as part of the revisions to the UCITS Directive and Alternative Investment Fund Managers Directive (AIFMD). On November 17, 2025, the European Commission adopted the Delegated Regulation with regulatory technical standards (RTS) specifying the characteristics of liquidity management tools (LMTs) under the AIFMD and the UCITS Directive. The Delegated Regulation specifies the characteristics and conditions of use for a full suite of LMTs, including: (1) suspension of subscriptions, repurchases, and redemptions; (2) redemption gates; (3) extension of notice periods; (4) redemption fees; (5) swing pricing; (6) dual pricing; (7) anti‑dilution levies; (8) redemptions in kind; and (9) side pockets. The goal is to ensure consistent application, supervisory convergence, and enhanced investor protection, while giving fund managers the flexibility to manage liquidity stress effectively. The Delegated Regulation applies to all EU managers of open‑ended AIFs and UCITS

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funds. Under AIFMD II and the amended UCITS Directive, managers must select at least two LMTs per fund (MMFs can select only one). These tools must be calibrated to the fund’s strategy, investor base, liquidity profile, and distribution channels.

On December 18, 2025, ESMA also published a revised version of its LMT guidelines for UCITS and open-end AIFs, which updated its April 2025 version to ensure full alignment with the RTS formally adopted by the European Commission on November 17, 2025. ESMA updated the guidelines to reflect that: (1) open‑ended AIFs with no retail investors and a limited number of professional investors can use investor‑level redemption gates alone or in combination with fund‑level gates to mitigate first‑mover advantage during liquidity stress; (2) explicit transaction costs must always be included in anti-dilution tool calculations; and (3) implicit transaction costs (e.g., market impact, bid‑ask spreads) must be included only where appropriate for the fund’s strategy and estimated on a best‑efforts basis. The revised guidelines apply to new funds from April 16, 2026, and existing funds have until April 16, 2027 to comply.

In the U.K., the FCA published a consultation paper on December 9, 2025 with respect to enhancing fund liquidity risk management. The proposed changes do not fundamentally alter the liquidity management requirements for U.K. open-ended funds, but do make certain changes to align the U.K. requirements with the amended IOSCO recommendations. The proposed changes are intended to apply to U.K. UCITS and U.K. non-UCITS retail schemes other than MMFs, and include: (1) requiring anti-dilution tools to be available for use, and imposing requirements and providing guidance regarding the calibration and use of such tools; (2) for transferable securities, removing the presumption that a security listed on an exchange is liquid, and thereby requiring an assessment of the liquidity of individual transferable securities (similar to ESMA’s proposals for UCITS, see ‘EU UCITS – Review of eligible assets’); and (3) requiring all unitholders to be treated equitably, which is expected to generally involve redemptions being satisfied by adopting a vertical slice approach to selling portfolio assets rather than selling only the most liquid assets. The FCA has not proposed extending these requirements to MMFs.

EU and U.K. sustainability requirements for asset managers and investment offerings. The regulation of sustainable investment offerings remains an area of focus for regulators outside the U.S. In the EU, there is a move towards introducing a sustainability labelling regime for investment products. On November 20, 2025, the European Commission published a proposal to amend the Sustainable Finance Disclosure Regime (SFDR). The proposed changes, commonly known as “SFDR 2.0,” would (1) simplify and reduce sustainability-related administrative and disclosure requirements; and (2) improve end-investors’ ability to understand and compare sustainability-linked financial products by introducing a classification (i.e., labelling) framework. The proposals are under review by the European legislative bodies. In the U.K., the FCA has stated that it requires additional time to consider the extension of the Sustainability Disclosure Requirements (SDR) sustainability labelling regime to asset managers providing portfolio management services, that it had consulted on in 2024. The FCA has yet to issue a consultation on the extension of the SDR sustainability labelling regime to non-U.K. funds that are recognized in the U.K.

EU and U.K. sustainability reporting requirements for corporations. The application of sustainability disclosure requirements to corporations has moved forward. In the EU, work has continued on changes to simplify the reporting burden under the Corporate Sustainability Reporting Directive (CSRD) (which sets out sustainability reporting requirements for certain EU and non-EU entities), the Corporate Sustainability Due Diligence Directive (CSDDD) (which imposes a due diligence duty on certain large EU/non-EU companies to address adverse human rights and environmental impacts in their own operations, their subsidiaries and their supply chains), and the existing requirements under the EU Taxonomy. This work is known as the ‘Omnibus I’ package. On December 9, 2025, the European Parliament and the Council of the EU reached a provisional agreement regarding amendments to the CSRD and CSDDD, and the changes to both directives were adopted by the European Parliament on December 16, 2025 (with the Council of the EU yet to adopt its final position). As currently drafted: (1) the revisions to CSRD will reduce the scope of entities subject to sustainability disclosure requirements, as well as reduce some of the reporting burden; and (2) the revisions to CSDDD will postpone the application date to July 26, 2029, reduce the scope of entities subject to it by raising the size threshold tests, delete the requirement for undertakings to have adopted and put into effect a transition plan, and seek to take a more proportionate approach to when and what information is required under the CSRD. Regarding the EU Taxonomy, this legislation determines whether an economic activity can be considered environmentally sustainable, which is relevant for various EU regulatory regimes. The Omnibus I package changes to the EU Taxonomy are in a Delegated Act, the final version of which was published on January 8, 2026. That Delegated Act: (1) introduces a materiality threshold for when a company must assess and report on whether a specific economic activity they engage in is aligned with the EU Taxonomy; (2) simplifies the reporting templates, including significantly reducing the number of data points; and, amongst other matters, (3) amends the EU ‘do no significant harm’ criteria regarding pollution prevention and the use of chemicals with a view to simplifying the report. The Delegated Act became effective on January 1, 2026.

In the U.K., the U.K. Government has stated that it is creating U.K. Sustainability Reporting Standards (U.K. SRS) that will apply to U.K. incorporated entities. The U.K. SRS is to be based on the sustainability disclosure standards developed by the International Sustainability Standards Board of the International Financial Reporting Standards Foundation. A consultation on

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the U.K. SRS was published on June 25, 2025 and closed on September 17, 2025. Following this, the U.K. Government and the FCA will consider how certain U.K. entities (including listing companies) will report against these standards. Meanwhile, the U.K. Government has decided that it will not develop a U.K.-specific green taxonomy.

EU and U.K. regulation of governance, environmental and social ratings providers. The framework for the regulation of providers of governance, environmental and social ratings in the EU and U.K. is being developed. In the U.K., the legislation setting out the framework for the regulatory regime was finalized on December 18, 2025 and the new regime will take effect on June 29, 2028. Subject to certain exemptions, governance, environmental and social rating providers would need to be authorized and regulated by the FCA and would be subject to requirements imposed by the FCA. The FCA published a consultation paper on December 1, 2025 regarding the requirements that would apply to governance, environmental and social rating providers subject to their supervision under the U.K. regulatory regime. The proposals include a four-pillar framework that focuses on: (1) transparency; (2) governance systems and controls; (3) conflicts of interest; and (4) complaint handling requirements. The FCA also intends to apply existing baseline rules to rating providers, including (among others), the anti-greenwashing rule and Senior Managers and Certification regime. The consultation closes on March 31, 2026.

The EU is at a more advanced stage with respect to its regulatory regime for providers of governance, environmental and social ratings. The Regulation regarding the transparency and integrity of governance, environmental and social rating providers came into force on January 2, 2025 and will apply effective July 2, 2026. Once effective, governance, environmental and social rating providers operating in the EU will need to be authorized by ESMA or, for providers established outside the EU, the European Commission must have adopted an equivalence decision and the provider must be subject to supervision in that country. With respect to the detailed regulatory requirements that will apply to governance, environmental and social ratings providers in the EU, on October 25, 2025, ESMA published its final report on three sets of draft RTS covering: (1) the authorization and recognition process of governance, environmental and social rating providers; (2) the separation of business lines by governance, environmental and social rating providers; and (3) disclosure requirements imposed on governance, environmental and social rating providers.

EU Savings and Investments Union (SIU) and Retail Investment Strategy (RIS). On April 15, 2025, the European Commission launched a targeted consultation on obstacles to capital markets integration across the EU. This encompassed a wide-ranging set of initiatives aimed to develop the EU capital and banking markets, and to boost the EU’s economic competitiveness by improving the way the EU financial system mobilizes savings towards productive investments. One component of the SIU is the Retail Investment Strategy (RIS), which aims to reinforce investor protection rules, address the participation of retail customers in capital markets and ensure that retail investors have access to quality financial products. On December 18, 2025, the European legislative bodies announced that a provisional agreement has been reached on the RIS package, which will introduce new retail investment rules and various amendments to several EU directives, including AIFMD and Markets in Financial Instruments Directive. The RIS package will seek to address a range of concerns, including: (1) requiring value for money assessments for retail investment products, including using peer group benchmarking for such assessments; (2) strengthening the rules on inducements and conflicts of interest for retail investment products; and (3) certain changes to the required contents for packaged retail and insurance-based investment products (PRIIPs) key information documents (KIDs) to aid investor comprehension and requiring KIDs to be machine-readable. The final text of the RIS package is expected in early 2026.

U.K. consumer access to retail products. In the U.K., the FCA published a discussion paper on December 8, 2025 on expanding consumer access to investments. The discussion paper describes changes to the retail investing landscape in the U.K., and states the FCA’s aim to continue to help consumers access investments that suit their circumstances. While the discussion paper does not detail specific proposals, the FCA states its intention: (1) to continue to support innovation by firms in the retail investment market; (2) to consider revised requirements on how firms communicate and promote financial products to customers; and (3) to streamline its financial promotion and distribution requirements in light of the Consumer Duty rules, which came into force in July 2023.

U.K. Consumer Composite Investments regime. The FCA has finalized its rules for the U.K. Consumer Composite Investments (CCIs) regime. The CCI regime will impose disclosure and related requirements on both FCA-authorized and unauthorized firms in relation to CCIs (including funds) that are or can be distributed to a retail investor in the U.K. The new rules will take effect on June 8, 2027, though firms will have the option of switching to the new disclosure regime from April 6, 2026. The CCI regime requires a “product summary” to be prepared and made available to client investors, and will replace the “PRIIPs KID” and ”UCITS key investor information document” disclosure documents prepared to date for funds. The product summary is intended to be a more flexible form of disclosure, but there will be some mandatory content with prescribed requirements, including a risk and return indicator, past performance information, and cost information.

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U.K. fund dealing models and tokenization. Fund tokenization is a key area of focus in the U.K. On October 14, 2025, the FCA published a consultation paper proposing new rules and plans to support and accelerate tokenization and efficiency in the U.K. fund market. The consultation paper also proposed changes to the FCA rules to allow U.K. authorized funds to switch to direct dealing models (even if not using tokenization). Final rules and guidance are expected in the first half of 2026.

U.K. Reform of AIFMD regime. HMT and the FCA published a consultation paper and call for input respectively on April 7, 2025, on the reform of the U.K. alternative investment funds regime which is derived from the EU AIFMD. Key proposals include the removal of the distinction between the existing registration regime for sub-threshold Alternative Investment Fund Manager (AIFM) and the authorization regime for full-scope AIFMs so that all AIFMs will be subject to a single authorization regime. Consequently, on the removal of the sub-threshold AIFM concept, it is proposed that the requirements for AIFMs would be based on a proportionate application depending on the size of the AIFM, with larger firms subject to more onerous requirements. For these purposes, AIFMs will be categorized into three tiers based on the size of their AUM. The proposed tiers are: (1) large – AUM of £5bn or more; (2) mid-sized – AUM of £100m to £5bn; and (3) small – AUM of £100m or less. The deadline for responses to the publications closed on June 9, 2025. The FCA intends to consult on detailed rules in the first half of 2026.

U.K. transaction reporting regime. In the U.K., the FCA intends to reform the transaction reporting framework as part of its post-Brexit review of the U.K. regulatory environment. On November 21, 2025, the FCA published a consultation paper setting out its proposals. The FCA states that its aim is to: (1) simplify and improve the regime by removing reporting obligations for six million financial instruments which are only tradeable on EU trading venues; (2) exclude foreign exchange derivatives from the scope of reporting requirements; and (3) streamline transaction reporting data fields. The FCA states that it intends to retain the exemption from the transaction reporting requirements for Collective Portfolio Management Investment firms. The consultation closes on February 20, 2026.

U.K. and EU T+1 Settlement. Following the migration to a T+1 settlement cycle in the U.S. effective May 28, 2024, the EU and U.K. are similarly taking steps to migrate from a T+2 to a T+1 settlement cycle. This is scheduled to occur in late 2027, but is subject to change. In relation to the EU, on June 18, 2025, the European Parliament and the Council of the EU reached political agreement on the necessary amendments to the Central Securities Depositaries Regulation (CSDR) to shorten the settlement cycle from T+2 to T+1. On September 17, 2025, the Council of the EU published the draft amendment legislation. The next step is for the Council to formally adopt the legislation which will subsequently be published in the Official Journal of the EU and apply effective October 11, 2027. In the U.K., on February 6, 2025, the Accelerated Settlement Technical Group (ASTG) published the U.K. implementation plan for the first day of trading for T+1 settlement, which it recommends should be October 11, 2027 – this date is in alignment with the EU approach. The ASTG also recommends that the U.K. and other EU jurisdictions should collaborate closely to determine if a coordinated shift to T+1 is possible. On February 19, 2025, the U.K. Government confirmed that it intends to legislate to make T+1 the standard settlement cycle in the U.K. from October 11, 2027. On November 20, 2025, HMT published a policy note and draft version of the amended CSDR. The CSDR changes will reflect and assist with the transition to a T+1 settlement cycle. The deadline for submitting technical feedback on the revised CSDR is February 27, 2026. Pending any comments received on the draft, HMT intends to publish the final revised CSDR in advance of October 11, 2027.

EU Financial Transaction Tax. Based on the European Commission’s 2026 Work Programme published in October 2025, the long-standing proposal for an EU-wide financial transaction tax (FTT), originally introduced in 2013, is being withdrawn. The Commission is withdrawing the FTT proposal due to a lack of progress, potential administrative burdens, and lack of alignment with current EU priorities.

Current Regulatory Environment – Potential Impacts

Applicable regulatory requirements, regulatory developments and regulatory supervision impact the domestic and international investment management industry generally by imposing substantial legal and compliance burdens, and significant restrictions and requirements, on its participants, and their offerings, and, therefore, will continue to impact, to various degrees, Federated Hermes’ Financial Condition.

The imposition of a FTT with broad application in the U.S., U.K., or EU, or the designation of Federated Hermes or any of its offerings, such as certain money market funds, as a SIFI, also can affect, potentially in a material way, Federated Hermes’ Financial Condition.

Federated Hermes has monitored, reviewed, and assessed, or will continue to monitor, review, and assess, regulatory developments and regulatory requirements, as applicable, and their impact on its business and offerings. Federated Hermes actively participates, either individually or with industry-trade groups (such as the ICI), in the public comment process

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regarding regulatory developments that can significantly impact Federated Hermes’ business and offerings. Regulatory developments and regulatory requirements also are subject to legal challenge in court, and Federated Hermes’ considers initiating, participating in or supporting such legal challenges when management deems it necessary or appropriate. Federated Hermes also continues to monitor and assess the impact of the interest rate environment (whether increasing or decreasing), and any instability in the banking sector and financial markets, on asset values and money market fund and other fund asset flows, and related asset mixes, as well as the degree to which these factors impact Federated Hermes' institutional prime and municipal (or tax-exempt) money market business and Federated Hermes' Financial Condition.

The difficulty in, and cost of, analyzing and complying with applicable regulatory developments and regulatory requirements increases with the number, complexity, and differing (and potentially conflicting) requirements of new or amended regulatory requirements, among other factors. In addition to the impact on Federated Hermes' AUM, revenues, operating income and other aspects of Federated Hermes' business, Federated Hermes' regulatory, product development and restructuring, and other efforts in response to regulatory developments and regulatory requirements, including the internal and external resources dedicated to such efforts, have had, and can continue to have, on a cumulative basis, a material impact on Federated Hermes' expenses and, in turn, Financial Condition.

Federated Hermes is unable to fully assess at this time whether, or the degree to which, any continuing efforts or potential options being evaluated in connection with modified or new regulatory developments and regulatory requirements ultimately will be successful. The degree of impact of regulatory developments and regulatory requirements on Federated Hermes' Financial Condition can vary, including in a material way, and is uncertain.

See Item 1A – Risk Factors – General Risk Factors – Regulatory and Legal Risks – Potential Adverse Effects of Changes in Laws, Regulations and Other Regulatory Requirements for additional information.

As of December 31, 2025, given the regulatory environment, and the possibility of future additional regulatory developments and regulatory requirements, and regulatory oversight, Federated Hermes is unable to fully assess the impact of regulatory developments and regulatory requirements, and Federated Hermes' efforts related thereto, on its Financial Condition. Regulatory developments and regulatory requirements in the current regulatory environment, and Federated Hermes' efforts in responding to them, could have further material and adverse effects on Federated Hermes' Financial Condition.

Human Capital Resource Management

At December 31, 2025, Federated Hermes had 2,091 employees, with 1,234 employees in Pittsburgh, Pennsylvania, and surrounding areas, 504 employees in London, England, 60 employees in New York, New York, 30 employees in Boston, Massachusetts, 181 employees in other U.S. locations and 82 employees in other locations outside the U.S.

The investment management business is highly competitive and experienced professionals have significant career mobility. Like other companies, Federated Hermes experiences employee turnover, which is tracked at various levels within the company, and conducts exit interviews with departing employees. The information derived from these interviews, as well as our employee development initiatives described below and succession planning, allows Federated Hermes to cultivate leaders, manage turnover and retain talented and qualified individuals. Federated Hermes’ ability to attract, retain and properly motivate highly qualified professionals across the company is a critical factor in maintaining its competitive position within the investment management industry and positioning Federated Hermes for future success. See Item 1A – Risk Factors – General Risk Factors – Other General Risks – Recruiting and Retaining Key Personnel (Human Capital Resource Management Risk) for more information on the risks to Federated Hermes if it is unable to attract and retain talented and qualified employees.

Competitive Compensation

Understanding that Federated Hermes’ business success depends on its ability to attract, retain, and incentivize talented and qualified individuals, Federated Hermes’ compensation programs across the company strive to meet this goal. Federated Hermes endeavors to reward individual contributions, as demonstrated by the delivery of long-term continuing results. Federated Hermes’ compensation programs are also designed to align the interests of its officers and employees with its business strategy, values, and objectives, including the interests of its customers and shareholders, while affording the business the opportunity to grow.

Generally, for employees working in the U.S., Federated Hermes’ compensation programs are comprised of competitive levels of cash compensation together with equity, a profit sharing/401(k) plan, and other corporate benefits/components for certain positions. Compensation is structured in the form of: salary, which is competitively evaluated annually; bonus; and, where appropriate, long-term incentives.

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Generally, for employees working in the U.K., and other non-U.S. locations, compensation is based on fixed and variable compensation. Fixed compensation can include base salary, a retirement plan together with equity and other corporate benefits/components for certain positions, and is designed to provide competitive fixed compensation at a level that reflects market compensation. Variable compensation is discretionary based on, among other factors, an employee’s performance, and behavior, as well as team and overall company performance.

Across Federated Hermes, the mix of overall salary, bonus, long-term incentives and other corporate benefits/components for certain positions varies by division, position, and employee.

Across Federated Hermes, national and industry-specific compensation surveys are utilized to monitor competitive pay levels. Compensation across the company is generally administered in four employee categories: Sales; Investment Management; Administration; and Executive. The employee’s category, position and performance generally drive the mix of fixed versus variable compensation, bonus structure/opportunity and long-term incentive structure/opportunity. Across the company (unless otherwise noted below):

•The pay mix for Sales employees is more heavily weighted in variable compensation based on quantitative and qualitative sales metrics. Depending upon the position, U.S. Sales employees are also eligible to receive cash-based long-term incentive awards annually which generally vest after three years, and, for certain levels of Sales employees, annual bonus restricted stock awards and periodic restricted stock awards.

•The pay mix for Investment Management employees includes variable compensation in the form of discretionary bonuses and takes into account, among other factors deemed relevant, investment offering performance from one-, three- and five-year periods. For employees working in the U.S., all or a portion of any annual performance bonus can be paid in cash or a combination of cash and annual bonus restricted stock. Beginning in 2026 (for any annual performance bonuses payable in 2027), employees working outside the U.S. will be able to receive all or a portion of any annual performance bonus in cash or a combination of cash and annual bonus restricted stock or restricted cash awards depending upon the jurisdiction in which they reside. Investment Management employees are also eligible for periodic restricted stock awards.

•Administrative employees have a pay mix more heavily weighted in fixed pay and are eligible for annual discretionary cash bonuses. Management employees are eligible for periodic restricted stock awards and U.S. senior management employees are also eligible for annual bonus restricted stock awards.

•The components of Federated Hermes’ executive compensation programs are designed to be competitive within the investment management industry and reward outcomes related to a variety of factors including Federated Hermes’ financial, investment, sales and customer service performance as measured against other similar companies within the investment management industry. Financial factors include, for example, Federated Hermes’ operating profits (as defined in Federated Hermes Annual Incentive Plan), AUM, gross offering sales, net offering sales, total revenue (including net revenues after taking into account the net pre-tax impact of any waivers to maintain the yields of certain money market funds at or above zero (Voluntary Yield-related Fee Waivers)), net income and net income per diluted share. Please refer to the Compensation Discussion and Analysis section of Federated Hermes’ Information Statement for additional information regarding executive compensation.

Federated Hermes’ Stock Incentive Plan is designed to support its retention and attraction objectives. Under this program, executive officers and certain employees are eligible to receive periodic restricted stock awards that vest over specified vesting periods (e.g., for U.S. employees, over a ten-year period, and for non-U.S. employees, over a five-year period). The restrictions on the vested portion of an award typically lapse on specified anniversary dates of an award (e.g., for U.S. employees, the award’s fifth- and tenth-year anniversaries, and for non-U.S. employees, generally, for awards prior to November 2025, the award’s sixth, seventh and eighth anniversaries which extend beyond the five-year vesting period in an effort to continue to align the employees’ and Federated Hermes’ interests during the restriction period and for awards effective November 2025 or later, the award’s fifth anniversary). Additionally, for certain groups of employees, a portion of their bonus awards are paid in the form of bonus restricted stock with a three-year ratable vesting schedule with restrictions lapsing on each vesting date.

For all employees working in the U.K., and other non-U.S. locations, discretionary bonus awards above a certain threshold are subject to deferral. Under the deferred bonus scheme, a portion of the bonus is deferred, notionally tracks the performance of certain Federated Hermes Funds, and vests over three years. Effective January 1, 2026 (for any discretionary bonuses paid in 2027), Federated Hermes’ compensation deferral practices have been harmonized globally, with Federated Hermes’ current bonus restricted stock program for U.S. employees being extended to, and replacing the current deferred bonus scheme applicable to, all non-U.S. employees. As a result, for eligible non-U.S. employees (similar to eligible U.S. employees), all or a portion if any annual performance bonus can be paid in cash or a combination of cash and annual bonus restricted stock or

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restricted cash awards depending upon the jurisdiction in which they reside, and the deferred compensation scheme described above applicable to non-U.S. employees will no longer apply to bonuses payable in 2027 or later and will lapse after three years (or in 2029).The Private Equity and Infrastructure businesses of Federated Hermes also operate carried interest and share of performance fee programs typical in the management of such asset classes.

When Federated Hermes acquires a company or business, the employees of such company can be subject to legacy compensation programs and arrangements until the company or business is fully integrated with Federated Hermes.

For 2025, Federated Hermes’ total Compensation and Related expense was $577.7 million and included, among other items, salary, bonus and share-based compensation expense.

Benefits

Federated Hermes’ benefit offerings across the company are designed to reflect the local market and equip Federated Hermes’ employees with resources and services to help them stay healthy, balance the demands of work and personal life, develop their careers, and meet their financial goals, as well as to further employee engagement and retention. Along with the traditional health and welfare benefits, such as medical and dental coverage, an employee assistance program, wellness program focusing on employee mindfulness, health and well-being, disability, paid time off and retirement programs, the company also offers flexible work arrangements which include hybrid work schedules, education assistance, paid parental leave, adoption benefits, volunteer paid time off, employee discounts and other programs and services.

Employee Development

Federated Hermes provides a professional work environment for employees across the company that supports employees’ career aspirations and professional development interests through training programs and mentoring initiatives. Our development framework consists of both on the job development opportunities as well as a robust offering of both classroom and online learning courses facilitated by a network of internal and external experts. Federated Hermes’ extensive training curriculums focus on technical, professional, leadership and management skills, and include, among others, courses on: the securities markets and Federated Hermes’ offerings; compliance/regulatory requirements; license exam preparation; sales skills; customer service skills; financial, physical and mental health well-being; remote working and hybrid management; dignity and respect in the workplace; individual and team performance; communication skills; technical (systems) topics; and general professional development. The attraction, development, and retention of qualified employees across the company supports Federated Hermes’ succession planning at all levels.

Inclusion

As of December 31, 2025, 39% of Federated Hermes’ employees are women. Female representation on Federated Hermes’ board of directors is 33%, and 10% of Federated Hermes’ executive officers are women. In the U.S., 8% of Federated Hermes’ employees are minorities, 34% of business managers are women and/or minorities and 29% of investment professionals are women and/or minorities.

One of Federated Hermes’ core tenets is that employees treat one another with dignity and respect. The company recognizes that a diverse, inclusive, and respectful workplace enhances the employee experience, encourages creativity, supports innovation and individual potential, and strengthens its ability to deliver better long-term risk-adjusted returns for clients and customers, as well as strong long-term business performance. Dignity acknowledges diversity. Diversity encompasses opportunity, acceptance, dignity, and respect. Inclusion is the extent to which each employee is welcomed, accepted, respected, supported, and valued as a team member. In line with this mission, Federated Hermes is committed to fostering a workplace where opportunity is supported and where employees’ unique and individual backgrounds, qualifications, expertise, skills, abilities, capabilities, perspectives, and experiences are recognized and appreciated on their merits for both their potential and actual contributions to the company.

The company actively demonstrates its long-term commitment to offering opportunities based on merit and fostering an inclusive environment. It cultivates the benefits of opportunity and workforce inclusion through its recruitment process, onboarding of new employees, and ongoing employee education and development. It strives to ensure that employees are recruited, engaged, rewarded, recognized, and trained based on their qualifications, skills, abilities, and aptitudes. Federated Hermes implements a long-term, activities-based approach to diversity and inclusion efforts. This approach is centered around four key pillars: driving opportunity and diversity; creating inclusion; outreach; and continuing the ongoing development of the company’s efforts.

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The board of directors, executive management, and senior leadership all actively support and endorse the company’s efforts to create a workplace grounded in dignity and respect. The Compensation Committee of Federated Hermes’ board of directors receives periodic updates and reports from management on these efforts and compensation practices. Management may also receive periodic updates. These efforts are advanced in collaboration with management and employees at all levels by various teams and resource groups across the company, including the Human Resources Department.

The company provides opportunities to qualified individuals without regard to race, color, national origin, religion, sex, pregnancy, sexual orientation, gender identity or expression, mental or physical disability, age, familial or marital status, ancestry, military status, veteran status, genetic information, or any other prohibited criteria, protected characteristic, or class under laws applicable to Federated Hermes.

Employees are encouraged to raise any human resources-related questions or concerns and to report any instances of discrimination, bullying, harassment, or other inappropriate conduct they experience or witness to their manager or the Human Resources Department. Separately, the company also provides a confidential phone line and website portal, operated by a third-party service provider, through which employees can report various compliance matters, if they choose.

Information about our Executive Officers

The following section sets forth certain information regarding the executive officers of Federated Hermes as of February 27, 2026:

*    Federated Advisory Companies include the following: Federated Advisory Services Company, Federated Equity Management Company of Pennsylvania, Federated Global Investment Management Corp., Federated Investment Counseling, Federated Investment Management Company and Federated MDTA LLC, each wholly owned by Federated Hermes.

Mr. J. Christopher Donahue has served as director, President and Chief Executive Officer (CEO) of Federated Hermes since 1998 and was elected as Chairman effective April 2016. He also serves as a director, trustee or officer of various Federated Hermes subsidiaries. He is President of 28 investment companies managed by subsidiaries of Federated Hermes. He is also director or trustee of 31 investment companies managed by subsidiaries of Federated Hermes. Mr. Donahue is the brother of Thomas R. Donahue who serves as Vice President, Treasurer, Chief Financial Officer and director of Federated Hermes.

Mr. Thomas R. Donahue has served as Vice President, Treasurer and Chief Financial Officer of Federated Hermes since 1998. He previously served as a member of Federated Hermes’ board of directors from May 1998 to April 2004 and was re-elected to Federated Hermes’ board of directors in April 2016. He also serves as an Assistant Secretary of Federated Hermes and is a director and President of FII Holdings, Inc., a wholly-owned subsidiary of Federated Hermes. He serves as a director of Federated Hermes Limited (FHL). He also serves as a director, trustee or officer of various other Federated Hermes subsidiaries. He is also a director or trustee of seven investment companies managed by subsidiaries of Federated Hermes.

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Mr. Donahue is the brother of J. Christopher Donahue who serves as President, CEO, Chairman and director of Federated Hermes.

Ms. Dolores D. Dudiak has served as Vice President of Federated Hermes since February 2021. She has served as Director, Human Resources since November 1997. She also has served as an officer of various Federated Hermes subsidiaries since 1994. In these capacities, she is responsible for the Human Resources Department at Federated Hermes, including Total Rewards, Human Resources Business Partners and Resourcing, Talent Development and Human Resources Information Management.

Mr. John B. Fisher has served as Vice President of Federated Hermes since 1998. He previously served as a member of Federated Hermes’ board of directors from May 1998 to April 2004 and was re-elected to Federated Hermes’ board of directors in April 2016. He has also been President and CEO of Federated Advisory Companies since 2006 and serves as a board member for each of these wholly-owned subsidiaries of Federated Hermes. He also serves as a director, trustee or officer of certain other Federated Hermes subsidiaries. He is President of three investment companies managed by subsidiaries of Federated Hermes. He is also director or trustee of 24 investment companies managed by subsidiaries of Federated Hermes. Prior to 2006, Mr. Fisher served as President of the Institutional Sales Division of Federated Securities Corp., a wholly-owned subsidiary of Federated Hermes.

Mr. Peter J. Germain has served as Executive Vice President, Chief Legal Officer and Secretary of Federated Hermes since October 2017, as General Counsel from January 2005 through June 2021 and Vice President of Federated Hermes since January 2005. In his capacity as Chief Legal Officer, he oversees the delivery of legal, compliance, internal audit and risk management services to Federated Hermes and its affiliates. He also serves as a director, trustee or officer of various Federated Hermes subsidiaries. Mr. Germain also serves as Chief Legal Officer, Executive Vice President and Secretary of 31 investment companies managed by subsidiaries of Federated Hermes.

Mr. Richard A. Novak has served as Vice President, Assistant Treasurer and Principal Accounting Officer of Federated Hermes since April 2013. Prior to that time, he served as Fund Treasurer of Federated Hermes’ U.S.-based mutual funds beginning in 2006 and served as the Controller of Federated Hermes from 1997 through 2005. He also serves as director or officer for various subsidiaries of Federated Hermes. Mr. Novak is a Certified Public Accountant.

Mr. Saker A. Nusseibeh is a director and CEO of FHL. He joined FHL in 2009 and was appointed CEO in May 2012, after serving as acting CEO beginning in November 2011 and having previously served as Chief Investment Officer from 2009 through November 2011. He formerly served as Global Head of Equities at Fortis Investments USA, having initially been appointed as Head of Global Equities in 2005. He also serves as a Chairman of Private Markets and as a director or officer of certain FHL subsidiaries.

Mr. Paul A. Uhlman has served as Vice President of Federated Hermes, and President and a director of Federated Securities Corp., a wholly-owned subsidiary of Federated Hermes, since June 2016. He is also a director, trustee or officer of certain subsidiaries of Federated Hermes. As President of Federated Securities Corp., he is responsible for the marketing and sales efforts of Federated Hermes. He had previously served as a Vice President of Federated Securities Corp. from 1995 through 2010, and served as Executive Vice President of Federated Securities Corp. from 2010 through June 2016. Mr. Uhlman also held the position of National Sales Director, Institutional Sales, from 2007 through June 2016.

Mr. Stephen P. Van Meter has served as Vice President and Chief Compliance Officer of Federated Hermes since July 2015. Between October 2011 and July 2015, he served as Compliance Operating Officer at Federated Hermes. Between October 2007 and October 2011, he served as Senior Counsel in the Division of Investment Management, Office of Chief Counsel, at the SEC. Between September 2003 and October 2007, Mr. Van Meter served as Senior Counsel in the SEC’s Division of Enforcement.

Mr. Theodore W. Zierden III has served as Vice President of Federated Hermes since July 2024. He has also served as the President-Administration of Federated Services Company since 2012. In such capacity, he manages the Global Technology Organization, Enterprise Delivery, Data Governance, Investor Services and Financial Planning and Analysis, which includes responsibility for company-wide mergers and acquisitions. Mr. Zierden is also Executive Managing Director of the Federated Hermes Private Markets business.

As Federated Hermes announced on December 2, 2025, effective April 30, 2026, Mr. John B. Fisher will step back from full-time responsibilities and no longer serve as an executive officer of Federated Hermes. Mr. Fisher is expected to remain actively involved in several major strategic initiatives as Chairman of the Federated Advisory Companies. Mr. Paul A. Uhlman will replace Mr. Fisher as President and CEO of the Federated Advisory Companies. Mr. Uhlman, who has been with Federated

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Hermes for 35 years, will remain a Vice President and executive officer of Federated Hermes. Mr. Bryan M. Burke (age 53), Federated Hermes’ National Sales Director, Strategic Solutions, and Executive Vice President, Federated Securities Corp., will replace Mr. Uhlman as President, Federated Securities Corp., and become a Vice President and executive officer of Federated Hermes. He has been with Federated Hermes for 23 years. These leadership changes will be effective after a transition period on April 30, 2026.

Mr. Fisher will remain on Federated Hermes’ Board of Directors during the transition period but is not standing for re-election to the Board at the next Annual Meeting of Shareholders of Federated Hermes, which will be held on April 30, 2026. Mr. Uhlman has been nominated for election to the Board at the next Annual Meeting of Shareholders.

Available Information

Federated Hermes makes available, free of charge, on its website, www.FederatedHermes.com, its annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, annual information statements and amendments to those reports, including those filed or furnished pursuant to Section 13(a) or 15(d) of the 1934 Act, as soon as reasonably practicable after such information is electronically filed with or furnished to the SEC.

Other Information

All references to the Notes to the Consolidated Financial Statements in this Form 10-K refer to those in Item 8 – Financial Statements and Supplementary Data (Consolidated Financial Statements). All other information required by this Item is contained in Note (5) to the Consolidated Financial Statements.

All cross-references between Items in this 10-K are considered to be incorporated into the Item containing the cross-reference.