* Union vote helps keep airline from bankruptcy

* Shares surge almost 13 pct to C$1.49

* Air Canada says times "extremely challenging"

* Will need "fundamental restructuring" for profitability (Adds Air Canada comments, updates share price)

By Nicole Mordant

VANCOUVER, British Columbia, July 15 (Reuters) - Air Canada's (ACa.TO: Quote, Profile, Research) (ACb.TO: Quote, Profile, Research) last hold-out union has voted in favor of a labor and pension agreement, the employee group said on Wednesday, helping the cash-strapped airline clear a major obstacle needed to keep it out of bankruptcy court.

Shares in Air Canada surged nearly 13 percent after the International Association of Machinists and Aerospace Workers said 60.32 percent of its members backed the deal in a re-vote, after they initially rejected it earlier this month.

"Air Canada seems to have cleared the labor hurdle. It was one of the things that had to happen to prevent a bankruptcy," said David Tyerman, an analyst at Genuity Capital Markets in Toronto.

The IAMAW, which represents 12,300 mechanics, baggage handlers and cargo agents at Canada's biggest airline, is the last of Air Canada's five unions to give its blessing to a 21-month extension to their contract agreements.