She recorded conversations with him for the FBI.
Fogle, a pitchman for Subway at the time, was attending a health event at a school in Florida in 2007 when the incident occurred, Herman said. She was covering the event for a local station when Fogle made a random comment.
"He told me that he thought middle school girls were so hot," Herman said. "I was in shock ... I actually was questioning, 'Did I really just hear what I think I heard?' I looked over at my cameraman ... and he was just astounded," she said.
The plea deal would see him serve between five and 12½ years in prison in a stunning downfall from a celebrated pitchman to a sex offender.
'He talked about' sex with minors
Herman saw Fogle numerous times over the years, and his comments and admissions got more brazen, she said.
"He talked about sex with underage children," she said. "It was just something that he really, really enjoyed," she said.
Herman said she notified law enforcement authorities, and the FBI asked her to wear a wire to record her conversations with Fogle.
For years, she said, she worked undercover with authorities to gather evidence against Fogle.
"He trusted me for unknown reasons," Herman told CNN's "AC360."
"He had said to me numerous times over the course of years about having sex with minors."
He got so comfortable with Herman, she said, he included her children in their conversations.
"I had two young children at the time, and he talked to me about installing hidden cameras in their rooms and asked me if I would choose which child I would like him to watch," she said.
'I had to play a role'
Although she was horrified by his suggestion, she focused on gathering evidence to put him behind bars.
"During the time that I had with the FBI, I had to play a role. I had to play a certain part in order for Jared to be able to trust me and talk further into detail," she said.
The U.S. Attorney's Office in Indianapolis, where Fogle was based, said Herman's information was part of the federal investigation into the former pitchman.
Tim Horty of the U.S. Attorney's Office said authorities also connected Fogle to alleged child pornography during their investigation into Russell Taylor.
Taylor, a former director of Fogle's charity that focuses on children's health, is facing child pornography charges as well. Authorities allege he had images and videos of minors engaging in sexual conduct that he shared with Fogle.
Fogle will plead guilty to possessing and distributing child porn and to traveling across state lines to have sex with at least two teenage girls.
Attempting to make amends
Under the plea deal, the government will recommend less than 13 years in prison for Fogle. And his lawyers agree to ask the judge for no less than five years in prison.
Fogle, 37, will also pay restitution to the 14 victims who were secretly photographed or who he paid for sex. Each victim will get $100,000 to help with counseling, support and other assistance.
By admitting to the crimes, Fogle is accepting responsibility and attempting to make amends, his defense team said in a statement.
His lawyers said he is also undergoing examination by sexual conditions experts with a goal of becoming healthy.
No date has been set for his next court date, where he will formally enter a plea.
Fogle became a household name 15 years ago after he lost more than 200 pounds on what he described as the Subway diet. He became the face of the restaurant chain, appearing in ads nationwide.
Subway cut ties with him this week.