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v3.25.1

Debt | 12 Months Ended
--- | ---
Mar. 31, 2025
Debt Disclosure [Abstract] |
Debt | Debt Debt consisted of the following on the dates below:
| March 31, 2025 |  | March 31, 2024
| Interest Rate |  | Outstanding Balance |  | Interest Rate |  | Outstanding Balance
Term Loan A | 5.675 | % |  | $ | 1,526 |  |  | 6.677 | % |  | $ | 1,588 |
Senior Notes due 2028 | 3.875 | % |  | 700 |  |  | 3.875 | % |  | 700 |
Senior Notes due 2029 | 4.000 | % |  | 500 |  |  | 4.000 | % |  | 500 |
Senior Notes due 2033 | 5.950 | % |  | 650 |  |  | 5.950 | % |  | 650 |
Senior Notes due 2035 | 5.950 | % |  | 650 |  |  | — | % |  | — |
Less: Unamortized debt issuance costs and discount on debt |  | (28) |  |  |  |  | (26) |
Total |  | 3,998 |  |  |  |  | 3,412 |
Less: Current portion of long-term debt |  | (83) |  |  |  |  | (62) |
Long-term debt, net of current portion |  | $ | 3,915 |  |  |  |  | $ | 3,350 |
Credit Agreement Booz Allen Hamilton Inc. (“Booz Allen Hamilton”), Booz Allen Hamilton Investor Corporation, and certain wholly owned subsidiaries of Booz Allen Hamilton are parties to a Credit Agreement dated as of July 31, 2012, as amended (the “Credit Agreement”), with certain institutional lenders and Bank of America, N.A., as Administrative Agent, Collateral Agent and Issuing Lender. As of March 31, 2025, the Credit Agreement provided Booz Allen Hamilton with a $1,526 million Term Loan A (“Term Loan A”) and a $1.0 billion revolving credit facility (the “Revolving Credit Facility”), with a sub-limit for letters of credit of $200 million. As of March 31, 2025, the maturity date of the Term Loan A and the Revolving Commitments is September 7, 2027. Voluntary prepayments of the Term Loan A and the Revolving Loans are permitted at any time, in minimum principal amounts, without premium or penalty. On July 27, 2023 (the “Tenth Amendment Effective Date”), Booz Allen Hamilton entered into a Tenth Amendment (the “Amendment”) to the Credit Agreement (as amended prior to the Tenth Amendment Effective Date, the “Existing Credit Agreement” and, as amended by the Amendment, the “Amended Credit Agreement”) with Bank of America, N.A., as administrative agent (in such capacity, the “Administrative Agent”), and the lenders and other financial institutions party thereto, in order to make permanent certain changes to the Existing Credit Agreement in connection with Booz Allen Hamilton obtaining investment grade ratings from both Moody's and S&P and to make certain additional changes in connection therewith, including, among other things, (i) removing the requirements for the obligations under the Amended Credit Agreement to be secured, (ii) removing the requirement for any subsidiary or other affiliate of Booz Allen Hamilton (other than the Company) to provide any guarantee of the obligations under the Amended Credit Agreement, and (iii) removing or modifying certain covenants applicable to Booz Allen Hamilton. Pursuant to the Amendment, all guarantees in respect of the Existing Credit Agreement have been released. The Amendment did not impact any of the terms of the Credit Agreement related to amortization or payments. On the Tenth Amendment Effective Date in connection with the Amendment, the Company entered into a Guarantee Agreement (the “Guarantee Agreement”) in favor of the Administrative Agent, pursuant to which the Company guarantees on an unsecured basis the obligations of Booz Allen Hamilton under the Amended Credit Agreement subject to certain conditions. Term Loan A amortizes in consecutive quarterly installments in an amount equal to 1.25% of the stated principal amount of Term Loan A. The remaining balance of Term Loan A will be payable upon maturity. The rate at which Term Loan A and the Revolving Loans bear interest will be based either on Term SOFR (subject to a 0.10% adjustment and a floor of zero) for the applicable interest period or a base rate (equal to the highest of (i) the administrative agent’s prime corporate rate, (ii) the overnight federal funds rate plus 0.50% and (iii) three-month Term SOFR (subject to a 0.10% adjustment and a floor of zero) plus 1.00%), in each case plus an applicable margin, payable at the end of the applicable interest period and in any event at least quarterly. The applicable margin for Term Loan A and the Revolving Loans ranges from 1.00% to 2.00% for Term SOFR loans and zero to 1.00% for base rate loans, in each case based on the lower of (i) the applicable rate per annum determined pursuant to a consolidated total net leverage ratio grid and (ii) the applicable rate per annum determined pursuant to a ratings grid. Unused New Revolving Commitments are subject to a quarterly fee ranging from 0.10% to 0.35% based on the lower of (i) the applicable fee rate per annum determined pursuant to a consolidated total net leverage ratio grid and (ii) the applicable fee rate per annum determined pursuant to a ratings grid. Booz Allen Hamilton has also agreed to pay customary letter of credit and agency fees. The Company occasionally borrows under the Revolving Credit Facility for our working capital needs. During the fourth quarter of fiscal 2025, the Company borrowed $200 million under the Revolving Credit Facility for our working capital needs, which was subsequently repaid with the proceeds from the bond offering in the same quarter. As of March 31, 2025 and March 31, 2024, respectively, there was no outstanding balance on the Revolving Credit Facility. Borrowings under Term Loan A, and if used, the Revolving Credit Facility, incur interest at a variable rate. As of March 31, 2025, Booz Allen Hamilton had interest rate swaps with an aggregate notional amount of $550 million. These instruments hedge the variability of cash outflows for interest payments on Term Loan A and the Revolving Credit Facility. The Company's objectives in using cash flow hedges are to reduce volatility due to interest rate movements and to add stability to interest expense (see Note 11, “Derivatives,” to the consolidated financial statements). The Credit Agreement contains customary representations and warranties and customary affirmative and negative covenants. In connection with Booz Allen Hamilton obtaining investment grade ratings from both Moody's and S&P, certain activities previously restricted by certain negative covenants are permitted subject to pro forma compliance with the financial covenants and no events of default having occurred or are continuing. In addition, Booz Allen Hamilton is required to meet certain financial covenants at each quarter end, namely the Consolidated Net Total Leverage Ratio. As of March 31, 2025 and March 31, 2024, Booz Allen Hamilton was in compliance with all financial covenants associated with its debt. Senior Notes On March 14, 2025, Booz Allen Hamilton issued $650 million aggregate principal amount of its 5.950% Senior Notes due April 15, 2035 (the “Senior Notes due 2035”) under an Indenture, dated as of August 4, 2023, and Second Supplemental Indenture, dated as of March 14, 2025, among Booz Allen Hamilton, the Company, as parent guarantor, and U.S. Bank Trust Company, National Association, as trustee. The following table summarizes the material terms of the senior notes issued by Booz Allen Hamilton as of March 31, 2025:
| Indenture Date | Principal (in millions) | Interest Rate | Maturity Date | Interest Payable | Issuance Costs (in millions)
Senior Notes due 2035 | 3/14/2025 | $650 | 5.950% | 4/15/2035 | April and October 15 | $6
Senior Notes due 2033 | 8/4/2023 | $650 | 5.950% | 8/4/2033 | February and August 4 | $12
Senior Notes due 2029 | 6/17/2021 | $500 | 4.000% | 7/1/2029 | July and January 1 | $7
Senior Notes due 2028 | 8/24/2020 | $700 | 3.875% | 9/1/2028 | March and September 1 | $9
The Senior Notes due 2035 and 2033 are fully and unconditionally guaranteed on an unsecured and unsubordinated basis by Booz Allen Hamilton Holding Corporation and rank equally and ratably in right of payment with all of Booz Allen Hamilton’s and Booz Allen Hamilton Holding Corporation’s other unsecured and unsubordinated indebtedness outstanding from time to time, pursuant to the relevant indenture. The Senior Notes due 2029 and 2028 are unsecured and are guaranteed by certain subsidiaries of Booz Allen Hamilton and rank equally in right of payment with all of Booz Allen Hamilton’s and the respective subsidiary guarantors’ existing and future senior indebtedness and rank senior in right of payment to any of Booz Allen Hamilton’s future subordinated indebtedness, pursuant to the relevant indenture. We refer to the Senior Notes due 2035, Senior Notes due 2033, Senior Notes due 2029 and Senior Notes due 2028, together, as the “Senior Notes”. Interest is payable on the Senior Notes semi-annually in cash in arrears, with the principal due at maturity. Issuance Costs were recorded as an offset against the carrying value of respective debt and are being amortized to interest expense over the term of the respective debt. All the Senior Notes’ indentures contain certain covenants, events of default, and other customary provisions. In connection with the Senior Notes obtaining investment grade ratings from Moody’s and S&P, in January 2023, certain negative covenants in the indentures governing the Senior Notes 2028 and Senior Notes 2029 were suspended. The Senior Notes are generally subject to redemption, in whole or in part, at Booz Allen Hamilton’s option, in whole or in part, at any time and from time to time, at the redemption prices specified in their respective indenture and outlined below:
|  | Optional Redemption Date |  | Redemption Price
Senior Notes due 2035 |  | present - 1/14/2035 |  | The greater of 1) the present value of the remaining payments plus 100% of the principal being redeemed, less accrued interest and 2) 100% of the principal amount being redeemed*
|  | 1/15/2035 - maturity |  | 100% of the principal amount being redeemed *
Senior Notes due 2033 |  | present - 5/4/2033 |  | The greater of 1) the present value of the remaining payments plus 100% of the principal being redeemed, less accrued interest and 2) 100% of the principal amount being redeemed*
|  | 5/4/33 - maturity |  | 100% of the principal amount being redeemed*
Senior Notes due 2029 |  | present - 6/30/2025 |  | 102% of the principal amount being redeemed*
|  | 7/1/2025 - 6/30/2026 |  | 101% of the principal amount being redeemed*
|  | 7/1/2026 - maturity |  | 100% of the principal amount being redeemed*
Senior Notes due 2028 |  | present - 8/31/2025 |  | 100.969% of the principal amount being redeemed*
|  | 9/1/2025 - maturity |  | 100% of the principal amount being redeemed*
*plus any unpaid interest Scheduled Maturities and Interest Expense The following table summarizes required future debt repayments:
|  | Payments Due By March 31,
|  | Total |  | 2026 |  | 2027 |  | 2028 |  | 2029 |  | 2030 |  | Thereafter
Term Loan A |  | $ | 1,526 |  |  | $ | 83 |  |  | $ | 83 |  |  | $ | 1,360 |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Senior Notes due 2028 |  | 700 |  |  | — |  |  | — |  |  | — |  |  | 700 |  |  | — |  |  | — |
Senior Notes due 2029 |  | 500 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 500 |  |  | — |
Senior Notes due 2033 |  | 650 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 650 |
Senior Notes due 2035 |  | 650 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 650 |
Interest on indebtedness |  | 1,105 |  |  | 194 |  |  | 206 |  |  | 159 |  |  | 111 |  |  | 87 |  |  | 348 |
Total |  | $ | 5,131 |  |  | $ | 277 |  |  | $ | 289 |  |  | $ | 1,519 |  |  | $ | 811 |  |  | $ | 587 |  |  | $ | 1,648 |
Interest expense consisted of the following:
| Fiscal Year Ended March 31,
| 2025 |  | 2024 |  | 2023
Term Loan A | $ | 100 |  |  | $ | 108 |  |  | $ | 63 |
Term Loan B | — |  |  | — |  |  | 5 |
Revolving Credit Facility | 1 |  |  | 1 |  |  | — |
Senior Notes | 88 |  |  | 73 |  |  | 47 |
Amortization of Debt Issuance Cost (DIC) and Original Issue Discount (OID) (1) | 6 |  |  | 5 |  |  | 4 |
Interest Rate Swaps | (10) |  |  | (15) |  |  | (1) |
Other | 1 |  |  | 1 |  |  | 1 |
Total Interest Expense | $ | 186 |  |  | $ | 173 |  |  | $ | 119 |
(1) DIC and OID on the Term Loans and Senior Notes are recorded as a reduction of long-term debt in the consolidated balance sheet and are amortized ratably over the life of the related debt using the effective rate method. DIC on the Company's Revolving Credit Facility is recorded as a long-term asset on the consolidated balance sheet and amortized ratably over the term of the Revolving Credit Facility.

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