UPDATE 1-Frontier clears key hurdle on bankruptcy exit path

* Judge says he will approve statement for creditors' vote

* Let Frontier begin soliciting votes for Republic deal

By Emily Chasan

NEW YORK, July 22 (Reuters) - A U.S. bankruptcy judge said he would let regional air carrier Frontier Airlines Holdings Inc FRNTQ.PK begin soliciting votes from creditors on its plan to be acquired by Republic Airways Holdings Inc (RJET.O) and exit bankruptcy later this year.

Judge Robert Drain, who sits in U.S. bankruptcy court in Manhattan, said at a court hearing on Wednesday that he would approve Frontier's disclosure statement that will be sent out to creditors for a vote, pending some small revisions from the company's lawyers.

Frontier said in June, that it had reached a deal to sell itself to Republic for $108.75 million so that it can exit bankruptcy protection in autumn 2009 as a subsidiary of Republic. Under the deal, Republic will sponsor Frontier's proposed bankruptcy reorganization plan.

Frontier, one of the leading U.S. regional carriers, filed for bankruptcy protection in April 2008 as the price of fuel surged and its credit card processor said it would withhold more proceeds from ticket sales.

Republic is based in Indianapolis and runs regional flights with large airline partners under such names as Delta Connection and US Airways Express.

Under the deal, Frontier Airlines and its Lynx Aviation unit would maintain their current names and continue operations normally.

The case is In re: Frontier Airlines Holdings Inc, U.S. Bankruptcy Court, Southern District of New York, No. 08-11298. (Reporting by Emily Chasan; Editing by Tim Dobbyn)