FriendFinder Networks (FFN) formerly called Penthouse Media Group Inc. $220mm IPO expected Thursday, January 28, 2009

FFN BREACHED LOAN AGREEMENTS

For the year ended December 31, 2008 and for the quarters ended March 31, 2008, June 30, 2008, September 30, 2008, March 31, 2009 and June 30, 2009, FFN failed to satisfy EBITDA covenants with respect to 2006 Notes and 2005 Notes because operating performance.

BUSINESS – not your Facebook-type social networking

. 70% of revenue from paid-usage adult-oriented products and services, 30% of revenue from the ‘general audience’ category . Penthouse: also produces and distributes original pictorial and video content, and licenses the globally-recognized Penthouse brand to a variety of consumer product companies and entertainment venues and publish branded men’s lifestyle magazines. . Built a base of over 365 million registrants and over 245 million members in over 170 countries, with a majority of ‘members’ outside of the United States

Internet audience drives revenue

. Internet business generated 93.6% of revenue for the nine months ended September 30, 2009 . As of September 30, 2009,had one million subscribers -- must continually add new subscribers to replace lost subscribers

SEPT 30, 2009 NINE MONTHS SUMMARY

Revenue flat

Adult subsribers decrease General audience decreases Web cam minutes decrease

Interest payments exceed operating profit by 66%

$75mm of interest, $45mm of operating profit Even after sales & marketing costs cut by $15mm or 33%

PENTHOUSE MEDIA

In December 2007, acquired Various (Penthouse Media) for $401.0 million, paid in cash and notes together with related warrants.

COMPETITION

Adult-oriented internet personals websites

Cytek Ltd., the operator of SexSearch.com and Fling Incorporated. FFN also competes with many adult-oriented and live interactive video websites, such as Playboy.com and LiveJasmin.com.

General audience

MySpace.com, Facebook.com and Friendster.com, as well as companies providing online personals services such as Match.com, L.L.C., Yahoo!Personals, a website owned and operated by Yahoo! Inc., Windows Live Profile, run by Microsoft Corporation, eHarmony, Inc., Lavalife Corp., Plentyoffish Media Inc. and Spark Networks Limited websites, including jdate.com, americansingles.com and relationships.com

GROSS PROFIT SUMMARY PER SUBSCRIBER

Lifetime revenue minus cost-per-subscriber TIMES gross profit % from Sept 2009 nine months

Adult

($82.64 - $47.07) * 72% = $25.60

General

(61.55 - 45.05) *72% = $11.88

BUSINESS METRICS

High churn rate

. Calculated by dividing terminations of subscriptions during the period by the total number of subscribers at the beginning of that period. . Average monthly churn rate, which measures the rate of loss of subscribers, for the adult social networking websites -- decreased from 17.8% per month for the nine months ended September 30, 2008 to 16.5% per month for the nine months ended September 30, 2009. . Average monthly churn rate for the general audience social networking websites -- decreased from 19.6% for the nine months ended September 30, 2008 to 16.2% for the nine months ended September 30, 2009.

Cost per gross addition (CPGA)

. Calculated by adding affiliate commission expense plus ad buy expenses and dividing by new subscribers during the measurement period. . Adult social networking websites -- decreased from $50.52 for the nine months ended . September 30, 2008 to $47.07 for the nine months ended September 30, 2009 . General audience social networking websites -- increased from $34.02 for the nine months ended September 30, 2008 to $45.05 for the nine months ended September 30, 2009.

Lifetime Revenue per subscriber

. Calculated by multiplying the average lifetime (in months) of a subscriber by ARPU for the measurement period and then subtracting the CPGA for the measurement period. . Adult social networking websites -- increased from $69.79 for the nine months ended September 30, 2008 to $82.64 for the nine months ended September 30, 2009. . General audience social networking websites -- increased from $59.67 for the nine months ended September 30, 2008 to $61.55 for the nine months ended September 30, 2009.

Marketing Affiliates: 44% of revenue

. Marketing affiliates are companies that operate websites that market FFN’s services on their websites. . As of September 30, 2009, had over 200,000 marketing affiliates from which FFN derives a substantial portion of new members and 44% of our revenue. . For the nine months ended September 30, 2009, made payments to marketing affiliates of 42.9 million.

USE OF $220MM PROCEEDS Repay debt

FriendFinder Networks	FRN, C, 6					Post-IPO shares: 40.8mm
Adult web sites			$mm
Boca Raton, FL		2007	2008	'08 9mos	'09 9mos $	IPO Mkt
Revenue		$333	$331	$244	$244	Cap (mm)
Gross profit %		70%	71%	70%	72%	$449
Operating profit %		8%	2%	7%	19%	@$11
Interest % of revenue		29%	22%	24%	31%
Profit (loss)		-$54	-$46	-$32	-$27
Profit (loss) % of revenue		-16%	-14%	-13%	-11%
VALUATION RATIOS	IPO Mrkt	Price /	Price /	Price /	Price /	% offered
	Cap (mm)	Sales	Earnings	BookValue	TangibleBV	in IPO
FriendFinder NetwksFFN	$449	5.5	-12	6.88	-1.05	49%
SCORECARD		Mgt	Market	Market Do-	Proprie-	Total
1-5, 5 is high			Growth	mination	tary	rating
20 is perfect		2	1	2	1	6