Casey, who has been with Hawaiian since 1997, said he plans to take some time off. His last day with Hawaiian will be June 30, the company said.

Under the terms of Hawaiian's planned merger with Aloha Airlines, Casey would have left Hawaiian at the completion of the deal. He said yesterday that, after the merger collapsed in March, he told Adams that he had "moved mentally" beyond his position at Hawaiian, while knowing that Adams wanted to take a more active role in running the airline.

"During the merger negotiations, it was clear that I was leaving the company," Casey said. "And so, at times like that you reflect on what it is that you want to do with the rest of your life. ... I think I've given a lot to the company in the last five years. I leave the company knowing full well that it's better off today than it was five years ago, so I leave with a sense of accomplishment."

Casey's future had been the topic of speculation since the airlines' merger fell through. He had been mentioned as a top candidate to head the Hawai'i Tourism Authority, which has been looking for a leader since the departure of Robert Fishman for active duty in November.

Yesterday Casey said people in tourism, the Legislature and elsewhere in the business community have asked him if he would be interested. But, he said, "I have not applied for it, I have not been interviewed and I have not met with anyone on the search committee."

In addition, Casey said, "I really need to take some time off. I don't want to jump from one high-pressure, high-profile job in running a public company to one which is high-pressure, high-profile with a different set of challenges. I don't want to do that immediately."

Nevertheless, Casey said he had not ruled out either the tourism authority position or any other offers he has thus far received.

Adams, a private investment specialist who became associated with Hawaiian in January 1996 as a majority stockholder via his company, Airline Investors Partnership, had been widely rumored to be planning a more active role with Hawaiian following the failed merger.

Adams, who is also president of Smith Management LLC, a Manhattan private investment firm, confirmed that the decision to leave the airline was Casey's, and praised Casey's work over the years.

"I think one of the greatest accomplishments of Paul in his five years is to overcome what existed when I first came to the company ­ a level of distrust between employees and management," Adams said. "And Paul has been able to bridge the gap between those two groups, so I think that people simply enjoy coming to work in the morning. And much of that is a result of what he's been able to do."

Among Casey's accomplishments, Adams said, were renegotiating employee contracts, replacing the aging interisland planes with new Boeing 717 aircraft, acquiring new planes for the Pacific routes, increasing revenues "well in excess of" 50 percent, and helping Hawaiian become a "fairly consistent cash-flow operation."

"And that has all been done under the direction of Paul, and we're very pleased with what he has done" Adams said.

During Casey's tenure, Hawaiian also inaugurated or announced service on seven new routes, improved its cash reserves from

$37.2 million in 1996 to $102.9 million in 2001, and negotiated six new union contracts.

"We've done a lot ­ and I hasten to add, this is a team effort," Casey said. "It's not driven by me. All I try to do is create an atmosphere here where the management group in general can be creative and innovative and look for new ways of generating revenue and reducing expense. And the team that exists at Hawaiian Airlines today is a great group of people."

Casey is the second executive to leave Hawaiian in recent months.

Robert Zoller, the company's former president and chief operating officer, left April 15 "to pursue professional opportunities outside the company," Hawaiian said then.

Hawaiian is working with a Mainland recruiting firm to find Zoller's replacement. Adams said that search would take precedence over a search for Casey's replacement.

Part of his role will be to help recruit the new president, bring him or her into the company and help "acclimate" the new executive to the job and Hawai'i, Adams said.

"With respect to the CEO-ship, I don't have that great a sense of urgency to replace myself, who has attempted to step into the shoes of Paul," Adams said.

Adams said that among his other immediate concerns is maintaining both the "continuity" of the airline's development that was fostered under Casey's guidance and the "momentum" being built prior to the merger talks.

Hawaiian and Aloha announced plans to merge in December, citing in part the need to combine forces after the drastic loss of business each suffered after the Sept. 11

attacks.

Although the merger is off, the two carriers still expect to apply for an antitrust exemption approved by Congress last fall that would allow Aloha and Hawaiian to cooperate on some operations in order to cut costs and make their operations profitable, Adams said yesterday.

"It is a difficult coordination to work on, but we are pursuing it diligently with Aloha with the hope of filing an application with the Department of Transportation in the near future," he said.

The most likely areas of cooperation would be on schedules and capacity in the interisland market, which Adams said has never been profitable in his six years with Hawaiian. The two airlines operate a number of competing interisland flights; documents filed with the federal government during the merger showed that both have lost money in that market.

The antitrust exemption expires in October, but the law provides for a one-year extension. Adams said the airlines expect to ask for the extension in their application.