Prospectus Summary
The following summary highlights information contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and consolidated financial statements included elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should carefully read the entire prospectus, including the “Risk Factors” and our consolidated financial statements and the notes to those statements, before making an investment decision. All references to “we,” “us,” “our,” or “our company” refer to FriendFinder Networks Inc. and, where appropriate, our consolidated direct and indirect subsidiaries. References to our “common stock” refer only to our $0.01 par value per share common stock and does not include our Series B common stock or our preferred stock. References to our “articles of incorporation,” “articles” or “charter” refer to our articles of incorporation as modified by the amendments we intend to effectuate prior to the consummation of this offering, which amendments include, among other things, (i) an increase in the authorized number of shares of preferred stock issuable by us by 200,000,000 shares, and (ii) a change in the par value of our authorized capital stock, including all classes and series of common and preferred stock, from $0.01 par value per share to $0.001 par value per share. References to our “bylaws” refer to the amended and restated bylaws we intend to effectuate prior to the consummation of this offering. For your convenience, we have included a glossary beginning on page G-1 of selected commonly referred to terms. Registered trademarks referred to in this prospectus are the property of their respective owners.
About Our Company
We are a leading internet-based social networking and multimedia entertainment company operating several of the most heavily visited social networking websites in the world. Through our extensive network of websites, since our inception, we have built a base of over 270 million members in approximately 170 countries offering a wide variety of online services so that our members can interact with each other and access the content available on our websites. Our websites are intended to appeal to members of diverse cultures and interest groups and include social networking, live interactive video and premium content websites. Our most heavily visited social networking and entertainment websites include AdultFriendFinder.com, Amigos.com, AsiaFriendFinder.com, Cams.com, FriendFinder.com, BigChurch.com and SeniorFriendFinder.com. Our revenue to date has been primarily derived from subscription and paid-usage adult-oriented products and services. We believe that our broad and diverse membership base also represents a valuable asset that will provide opportunities for us to offer targeted online advertising to specific demographic groups. In addition to our online products and services, we also produce and distribute original pictorial and video content, license the globally-recognized Penthouse brand to a variety of consumer product companies and entertainment venues and publish branded men’s lifestyle magazines. For the nine months ended September 30, 2008, our net revenue, operating income and earnings before deducting net interest expense, income taxes, depreciation and amortization, or EBITDA, were $262.4 million, $36.1 million and $66.6 million, respectively, as pro forma adjusted for an $18.5 million non-recurring reduction in net revenue due to purchase accounting that required the deferred revenue to be recorded at fair value on the date of acquisition, to a deferred revenue liability at the date of acquisition of Various, Inc., or Various, and our net loss was $32.3 million unadjusted for this purchase accounting. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
We categorize our users into four categories: visitors, members, subscribers and paid users and focus on the following key business metrics to evaluate the effectiveness of our operating strategies.
Our Competitive Strengths
We believe that we have the following competitive strengths that we can leverage to implement our strategy:
Our Strategy
As one of the world’s leading internet-based social networking and multimedia entertainment companies, our goal is to enhance revenue opportunities while improving our profitability. We plan to achieve these goals using the following strategies:
Our executive offices are located at 6800 Broken Sound Parkway, Boca Raton, Florida 33487 and our telephone number is (561) 912-7000. Our website address is www.ffn.com. The information contained in, or accessible through, our website is not part of this prospectus.