Core Viewpoint - The company Huaxia Happiness is facing financial distress, leading to a court application for restructuring due to its inability to repay debts and significant financial losses [2][4][6]. Financial Situation - As of the first three quarters of 2025, Huaxia Happiness reported revenue of approximately 2.882 billion yuan, a year-on-year decline of 72.09%, and a net profit attributable to shareholders of approximately -9.828 billion yuan [4]. - The company's equity attributable to shareholders was -4.738 billion yuan as of September 30, 2025, indicating severe financial instability [4]. - The debt-to-asset ratio stood at 96.44%, an increase of 2.76 percentage points from the previous year, while the current ratio decreased by 12.23% to 1.65, and the quick ratio dropped by 32.26% to 0.42 [5]. Debt Restructuring Efforts - Huaxia Happiness has signed a debt restructuring plan for approximately 1.927 billion yuan of its total financial debt of 2.192 billion yuan, with interest and penalty waivers amounting to 20.203 billion yuan [6][7]. - The company has utilized its subsidiary equity to offset financial debts, with the "Happiness Selected Platform" accounting for approximately 17.454 billion yuan in debt compensation, granting creditors about 43% equity in that platform [7]. - As of October 31, 2025, the company reported a total of 24.569 billion yuan in overdue debts, excluding interest, with new overdue amounts of 563 million yuan added in October [7]. Court Proceedings - The Langfang Intermediate People's Court has accepted the pre-restructuring application, although this does not guarantee the acceptance of the formal restructuring application [3][4]. - The company has indicated that the pre-restructuring process carries significant uncertainty regarding its success and that it will continue to manage its daily operations during this period [4].