HMH insists its restructuring plan will strengthen the company financially.

Education publisher Houghton Mifflin Harcourt (HMH) is seeking to reassure schools that it’s business as usual after filing for Chapter 11 bankruptcy May 28 to wipe out $3.1 billion in debt.

HMH, which publishes software and textbooks used by some 57 million students throughout all 50 U.S. states and 120 countries, said it has reached an agreement with more than 70 percent of its lenders and bondholders on the terms of a financial restructuring plan to convert the company’s outstanding debt into equity. More than 20 HMH affiliates, including Broderbund LLC and Classroom Connect Inc., also entered bankruptcy.

HMH said its plan would eliminate the company’s debt and reduce current annual cash interest costs by approximately $250 million, providing the company with “greater liquidity and financial flexibility as it pursues growth opportunities.”

By filing for Chapter 11 bankruptcy, instead of Chapter 7, which usually implies a company’s immediate exit, it appears that HMH intends to stay in business. While the company is in the bankruptcy process, it can’t be sued by creditors.

HMH insists its restructuring plan will strengthen the company financially.

“This is good news for our company,” said Linda Zecher, president and CEO of HMH, in a video that can be found here. “Our company has enough positive cash flow to continue normal operations. There will be no disruptions.”

On a question-and-answer webpage about the restructuring, HMH assures its stakeholders that the company has “no plans for layoffs or closings as a result of this process” and that it doesn’t “expect any changes in our business relationships with our authors, artists, or customers, other than the opportunity to grow our relationship further. Your contacts at HMH will remain the same, and we will continue to deliver on our commitments as usual.”

According to Bloomberg Businessweek, HMH had roughly $1.29 billion in sales last year, and the company says it plans to borrow as much as $500 million through Citigroup Inc. to complete the bankruptcy process.

Moody’s Investors Service earlier this month cut HMH’s corporate credit grade to the second-lowest rating, reserved for borrowers that “offer very poor financial security.” In March, Moody’s said the company’s capital structure was “unsustainable without a significant rebound in earnings.”

At a time when many publishers are struggling to make the transition from a mostly print-based to a digital market, HMH spokeswoman Bianca Olson said the shift from print to digital played no role in the company’s financial situation. Instead, she attributed HMH’s debt to “multiple acquisitions, coupled with a slower-than-expected economic recovery.”