FriendFinder have won an appeal to let their creditors vote on a restructuring plan, which would see them exit bankruptcy hearings.
The plan would turn the company over to its noteholders, cut $300m in debt and reduce annual interest expenses by about $50m.
The disclosure statement detailing the plan was approved by US Bankruptcy Judge Christopher Sontchi in Wilmington, Delaware on Wednesday.
The Californian company, which owns Penthouse magazine, saw their sales decrease 10% in the last fiscal year and their social-networking revenue drop by 17%.
In September they filed for bankruptcy after a loss of $50m in the last fiscal year – declaring assets of $465.3m, and debt of $661.9m.
The company also own over 8,000 sites that include AdultFriendFinder.com, FastCupid.com, PerfectMatch.com and BigChurch.com.
The restructuring plan would see the second-lien noteholders, who are owed $330.8m, exchange debt for all of reorganised FriendFinder’s equity.
First-lien noteholders, owed $234.3m, would get cash and new notes.
Current shareholders would receive nothing.
They will seek approval for this plan on Dec 16, which if granted would see them exit bankruptcy.