it emerged yesterday.

The Newark-based airline, which served Bermuda before being grounded for the first time in September, 1996, struck a deal with the Federal Aviation Administration last month which has since been approved by a US bankruptcy judge, the Associated Press reported yesterday.

The airline which has been in debt and without planes or permission to fly since March 24 -- the second time it has entered bankruptcy in its seven-year history -- will now meet with the FAA in a bid to get back in the air.

Kiwi's court-appointed trustee Charles Stanziale told AP: "With the court's approval in hand, we can now begin the process to work with the FAA which will lead to the restart of service.'' He added the airline would meet with FAA officials "very soon to set out a game plan and begin the review process''.

Kiwi was grounded for the second time when the FAA determined that it was unable to fly its schedule safely. Kiwi was serving just Newark; Miami, Orlando and Palm Beach, Florida; and San Juan and Aguadilla, Puerto Rico.

The grounding derailed the airline's plans to be acquired for $3 million by Pan Am Airways, a former commercial airliner that flies charters out of New Hampshire and forced it to lay off nearly all of its 500 workers and surrender its four leased jets.

At its peak in the mid-1990s, Kiwi had 1,200 workers, and they owned a controlling share of the airline, which boasted 15 leased jets. The airline operated a service to Bermuda from Atlanta.

The founding pilots and flight attendants named Kiwi for a flightless bird to symbolise how they had lost their wings -- and jobs -- when Eastern and other carriers failed.