Bond Embarq 7.995% ( US29078EAA38 ) in USD

Embarq

49.75 % ▼

United States

US29078EAA38 ( in USD )

7.995% per year ( payment 2 times a year)

31/05/2036

Prospectus brochure of the bond Embarq US29078EAA38 en USD 7.995%, maturity 31/05/2036

1 000 USD

1 485 000 000 USD

29078EAA3

CCC ( Extremely speculative )

Caa2 ( Extremely speculative

01/06/2024 ( In 44 days )

The Bond issued by Embarq ( United States ) , in USD, with the ISIN code US29078EAA38, pays a coupon of 7.995% per year.
The coupons are paid 2 times per year and the Bond maturity is 31/05/2036

The Bond issued by Embarq ( United States ) , in USD, with the ISIN code US29078EAA38, was rated Caa2 ( Extremely speculative by Moody's credit rating agency.

The Bond issued by Embarq ( United States ) , in USD, with the ISIN code US29078EAA38, was rated CCC ( Extremely speculative ) by Standard & Poor's ( S&P ) credit rating agency.

Form 424(b)(4)
424B4 1 d424b4.htm FORM 424(B)(4)
Table of Contents
Filed Pursuant to Rule 424(b)(4)
Registration No. 333-131747
PROSPECTUS
$4,485,000,000
Embarq Corporation

$1,000,000,000 6.738% Notes due 2013
$2,000,000,000 7.082% Notes due 2016
$1,485,000,000 7.995% Notes due 2036
We are currently a subsidiary of Sprint Nextel Corporation. Sprint Nextel has determined to spin off our
company by distributing all of our common stock to its stockholders as a dividend. In connection with the spin-
off, we will issue to Sprint Nextel $1,000,000,000 aggregate principal amount of 6.738% Notes due 2013,
$2,000,000,000 aggregate principal amount of 7.082% Notes due 2016, and $1,485,000,000 aggregate principal
amount of 7.995% Notes due 2036. Sprint Nextel intends to transfer these notes to Sprint Capital Corporation, its
wholly owned subsidiary, which intends to sell the notes. In connection with the offering of the notes, each of
Sprint Nextel and Sprint Capital is an "underwriter" within the meaning of the Securities Act of 1933. We will
not receive any of the proceeds from the sale of the notes being offered.
The 2013 notes will mature on June 1, 2013, the 2016 notes will mature on June 1, 2016, and the 2036 notes will
mature on June 1, 2036. We will pay interest on the notes semiannually on June 1 and December 1 of each year,
beginning on December 1, 2006. We may redeem some or all of the notes as discussed under the caption
"Description of the Notes--Optional Redemption." The notes will be our senior unsecured obligations and will
rank equally with all of our other existing and future senior unsecured indebtedness. The notes will effectively
rank junior to all indebtedness and other liabilities of our subsidiaries.
We do not intend to list the notes on any exchange or to include the notes in any automated quotation system.
See " Risk Factors" beginning on page 13 for a discussion of the factors that you should consider
before buying the notes.
Neither the Securities and Exchange Commission nor any state securities commission has approved or
disapproved of these securities or determined if this prospectus is truthful or complete. Any representation
to the contrary is a criminal offense.

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Form 424(b)(4)
Public Offering
Underwriting
Proceeds to
Price(1)
Discounts
Sprint Capital

Per 2013 note

99.995%
0.875%
99.120%
Total
$ 999,950,000 $ 8,750,000 $ 991,200,000
Per 2016 note

99.994%
0.875%
99.119%
Total
$1,999,880,000 $17,500,000 $1,982,380,000
Per 2036 note

99.993%
0.875%
99.118%
Total
$1,484,896,050 $12,993,750 $1,471,902,300
Combined Total (before expenses)
$4,484,726,050 $39,243,750 $4,445,482,300

(1)
Plus accrued interest, if any, from May 17, 2006 to the date of delivery.

Interest on the notes, if any, will accrue from May 17, 2006 to the date of delivery. The underwriters expect to
deliver the notes through the facilities of The Depository Trust Company against payment in New York, New
York on May 19, 2006, which is expected to be the second business day following the distribution date and the
fifth business day following the date of this prospectus.

Bear, Stearns & Co. Inc.
Goldman, Sachs & Co.
Lehman Brothers

Citigroup

JPMorgan
Banc of America Securities LLC

RBS Greenwich Capital
Barclays Capital

Wachovia Securities
Mitsubishi UFJ Securities

The date of this prospectus is May 12, 2006.
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Form 424(b)(4)
Table of Contents
TABLE OF CONTENTS

Summary

1
Risk Factors

13
Cautionary Statement Regarding Forward-Looking Statements

23
Use of Proceeds

25
Capitalization

26
Selected Combined Financial Data

27
Unaudited Pro Forma Combined Financial Information

29
Management's Discussion and Analysis of Financial Condition and Results of Operations

36
Business

59
Management

79
Security Ownership of Certain Beneficial Owners
101
Agreements with Sprint Nextel
101
Selling Noteholder
111
Description of the Notes
112
Material U.S. Federal Income Tax Considerations
124
Underwriting
128
Legal Matters
131
Experts
131
Where You Can Find More Information
131
Index to Financial Statements and Financial Statement Schedule
F-1
You should not assume that the information contained in this prospectus is accurate as of any date other than the
date set forth on the cover. Changes to the information contained in this prospectus may occur after that date,
and we undertake no obligation to update the information, except in the normal course of our public disclosure
obligations and practices. You should be aware of certain risks relating to the spin-off, our business and
ownership of the notes, which are described under the heading "Risk Factors."

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Form 424(b)(4)
Table of Contents
SUMMARY
This summary highlights selected information contained in this prospectus. We urge you to read carefully this
prospectus in its entirety. Except as otherwise indicated, references in this prospectus to "Embarq," "we," "us"
or "our" are to Embarq Corporation and its subsidiaries. Effective August 12, 2005, Nextel Communications,
Inc., which we refer to as Nextel, merged with and into a subsidiary of Sprint Corporation. Following the
merger, which we refer to as the Sprint Nextel merger, Sprint changed its name to Sprint Nextel Corporation,
which we refer to as Sprint Nextel. References in this prospectus to "Sprint" are to Sprint Corporation before the
completion of the Sprint Nextel merger. References in this prospectus to "Sprint Capital" are to Sprint Capital
Corporation, a wholly owned subsidiary of Sprint Nextel.

Our Company
We are a new company that, following the spin-off, will own the incumbent local communications operations
conducted by Sprint Nextel and reported as its Local segment in its financial statements. The spin-off is a
transaction that involves two general steps. First, Sprint Nextel will transfer to us assets consisting primarily of
Sprint Nextel's incumbent local communications operations. In exchange for, and as a condition to, the transfer
of assets and assumption by us of certain liabilities, Sprint Nextel will receive (1) shares of common stock of our
company and (2) the notes being offered by Sprint Capital under this prospectus and the cash proceeds of our
new borrowings, in an aggregate amount of approximately $6.6 billion. Secondly, Sprint Nextel will distribute
pro rata to its stockholders shares of our common stock. We refer to this last step as the distribution. The
distribution date for the distribution is expected to occur on or about May 17, 2006. As a result of the spin-off, we
will become a separate public company, although we will continue to have a number of significant commercial
arrangements with Sprint Nextel. Following the spin-off, we expect to be included in the Fortune 500 list based
on our historic revenues and those of other companies included in the most recent version of that list.
We offer regulated local communications services as an incumbent local exchange carrier, or ILEC, to roughly
5% of U.S. households, with approximately 7.26 million consumer and business access lines, as of March 31,
2006. Following the spin-off, we will provide a suite of communications services, consisting of local and long
distance voice and data services, including high-speed Internet access. We also expect to provide access to our
local network and other wholesale communications services for other carriers, communications equipment for
business markets, and other communications-related services. Following the spin-off, we expect to provide code
division multiple access, or CDMA, based wireless voice and data services in most of our local service territories
to consumers and small business customers through a non-exclusive wholesale arrangement involving a mobile
virtual network operator, or MVNO, relationship, with Sprint Nextel. We also expect to offer certain wireline
voice and data, wireless and video services through sales agency and other wholesale agreements.
Following the spin-off, we expect to have total indebtedness of approximately $7.25 billion. A portion of this
debt is currently outstanding, and we will incur the remainder, approximately $6.6 billion, in connection with the
spin-off. We intend to transfer the cash proceeds of the new indebtedness and issue the notes being offered by
Sprint Capital under this prospectus in partial consideration for the assets to be transferred to us by Sprint Nextel
in the spin-off. The transfer of the assets is conditioned on our incurrence of the new indebtedness and making
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Form 424(b)(4)
the related transfers to Sprint Nextel.
We will continue to serve our local service territories, which are located in 18 states. We have a significant
presence in Florida, North Carolina, Nevada and Ohio (these four states represent nearly two-thirds of all of our
access lines). The remaining states (in order of number of access lines) are: Virginia, Pennsylvania, Texas,

1
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Form 424(b)(4)
Table of Contents
Indiana, Missouri, Tennessee, New Jersey, Minnesota, Kansas, South Carolina, Washington, Oregon, Nebraska
and Wyoming.
Our Strengths
We believe our strengths will enable us to continue to generate cash flow and to grow new streams of revenue by
diversifying our offerings, such as high-speed Internet services, while also allowing us to focus our efforts on
minimizing the loss of access lines in our traditional local wireline business. Our principal strengths include:
Longstanding customer relationships
As the incumbent provider of communications services in our local service territories, we have developed
longstanding customer relationships. Based on our estimates, we provide communications services to
approximately 85% of the total potential customers in our local service territories, which we define to include
potential customers who purchase local wireline services or wireless services in lieu of wireline. We manage our
service offerings at the local level to serve the needs of each community effectively and efficiently.
Pre-existing network infrastructure
As the incumbent provider of communications services in our local service territories, we have a network
infrastructure already in place to serve our customers' current needs and that can also serve as the foundation for
offering new services to meet our customers' evolving needs.
Ability to offer a wide array of bundled services
We believe that following the spin-off, we will be among the few communications service providers in many of
the markets we serve that can provide a suite of services to both consumers and business customers that includes
wireline voice services, high-speed data, consumer video entertainment services, and communications equipment
for business customers. We plan to expand our service offerings by providing CDMA-based wireless voice and
data services to our consumers and business customers in our local service territories through our MVNO and
sales agency relationships with Sprint Nextel. We seek to maximize profitable communications services revenue
per customer through the convenience and cost savings of using a single provider for a broad suite of services. By
offering a bundled package of products and services, we have improved our long distance and high-speed
Internet services penetration, resulting in increased revenue and lower customer churn, which have helped to
offset revenue decreases driven by continuing declines in access lines and product substitution. Going forward,
we expect to go beyond merely bundling services by offering truly integrated or converged services and we
believe that, combined with the modernization of our networks (such as by circuit to packet migration) and
support systems, this will allow us to be more competitive and thereby achieve a greater market share.
Favorable demographics
The annual growth in number of households in our local service territories has averaged approximately 1.8%
over the three years ended December 31, 2005, compared to the national average over that period of
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Form 424(b)(4)
approximately 1.3%. Our local service territories cover all or part of six of the 20 fastest growing metropolitan
statistical areas, or MSAs, based on the 2000 census. Approximately 29% of our access lines as of December 31,
2005 were in those MSAs.

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Form 424(b)(4)
Table of Contents
Service and product expertise
We believe that our strong heritage provides a solid foundation for the continued development and delivery of
cost-effective products and services. We intend to build on the core strengths of our business to fulfill our
mission of providing high quality, cost-effective products and services and innovations that address our
customers' communications needs.
Experienced management team
We have a senior management team with experience managing the expansion of communications companies,
including experience at Sprint.
Business Strategy
Our strategy is to maximize profitable communications services revenue per customer by selling integrated and
bundled products and services and meeting the needs of our consumers and business and wholesale customers
within our local service territories. Four key goals will support this strategy:

· Provide useful products and solutions to attract and retain customers by marketing integrated service
offerings including video and wireless services, expanding high speed Internet coverage, developing

simplified products that meet our customers' needs and updating our networks to provide Internet
Protocol, or IP, based services such as Voice over Internet Protocol, or VoIP;

· Improve customer experience and perception of service and product offerings by providing customers
with simplified billing, maintaining service quality and reliability, expanding our distribution channels,

providing competitively priced services and using our local market knowledge and experience to provide
customers with superior service.

· Manage costs by implementing process improvements, focusing our network investment in areas that
support enhanced services including high-speed network facilities, improving the efficiency and

effectiveness of our customer support operations and simplifying our information technology, or IT,
support systems.

· Maintain a customer-focused culture that encourages high performance and employee satisfaction by
maintaining our commitment to the communities we serve, providing innovative and competitive

services while providing an exceptional customer experience, making Embarq a great place to work by
improving employee communication, and aligning management and employee incentives and
compensation plans.
We describe in this prospectus the local communications business to be transferred to us by Sprint Nextel in the
spin-off as if it were our business for all historical periods described. However, we are a newly formed entity.
References in this document to our historical assets, liabilities, products, business or activities generally refer to
the historical assets, liabilities, products, business or activities of the transferred business as it was conducted as
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Form 424(b)(4)
part of Sprint Nextel and its subsidiaries before the spin-off. Our historical financial results as part of Sprint
Nextel contained in this prospectus may not be indicative of our financial results in the future as an independent
company or reflect what our financial results would have been had we been an independent company during the
periods presented.
Our principal executive offices are located at 5454 W. 110th Street, Overland Park, Kansas 66211 and our main
telephone number is (913) 323-4637. We were incorporated in Delaware in 2005.

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Form 424(b)(4)
Table of Contents
The Spin-off
Assets and Liabilities Transferred to We and Sprint Nextel have entered into a separation and distribution
Embarq
agreement that contains the key provisions relating to the separation of
our business from Sprint Nextel and the distribution of our shares of
common stock. The separation and distribution agreement identifies the
assets to be transferred, liabilities to be assumed and contracts to be
assigned to us by Sprint Nextel in the spin-off and describes when and
how these transfers, assumptions and assignments will occur. See
"Agreements with Sprint Nextel--Separation and Distribution
Agreement."
Relationship with Sprint Nextel
Before the distribution date, we and Sprint Nextel will also enter into
After the Spin-off
agreements to define the initial relationship between Sprint Nextel and
us with respect to a number of services that will be provided. We are
entering into commercial service agreements with Sprint Nextel
pursuant to which we will purchase certain wireless and long distance
services from Sprint Nextel to support our business and Sprint Nextel
will purchase special access, calling number identification and other
services from us. The commercial service agreements that we are
entering into with Sprint Nextel have terms that generally extend from
two to seven years and, in certain circumstances, may be terminated
earlier by us or Sprint Nextel.

We have also entered into transition services agreements under which we and
Sprint Nextel will provide each other certain services on an interim basis.

We and Sprint Nextel will also enter into an agreement providing for the sharing
of taxes incurred before and after the distribution, certain indemnification rights
with respect to tax matters and certain restrictions to preserve the tax-free status
of the distribution to Sprint Nextel.

See "Risk Factors--Risk Factors Relating to the Spin-off--The agreements that
we are entering into with Sprint Nextel may involve, or may appear to involve,
conflicts of interest" and "--Some of the agreements we are entering into with
Sprint Nextel contain early termination provisions that, if exercised by Sprint
Nextel, could be materially detrimental to our ability to operate our business."
See also "Agreements with Sprint Nextel."

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Document Outline

sec.gov
- #1">Form 424(b)(4)