Andrew Cook is entitled to the huge pay-off under the terms of a service agreement signed in 1991, details of which are contained in the company's defence document published yesterday.
Mr Cook, who is on a five-year rolling contract, will receive the lower of five times his annual salary or pounds 1.5m if he resigns or is dismissed within a year of William Cook changing ownership. Mr Cook's service contract shows he enjoys an annual salary of pounds 350,000 but his pay could double under the terms of a controversial bonus scheme which was amended on Wednesday.
Mr Cook defended his potential pay-off. "It's not excessive, in fact I think it is a pittance," he said.
"It's a pretty small price to pay to have your life's work taken off you.
"It is not as if I have wrecked the company and been paid off," he continued.
"Shareholders would have lost all their money if it hadn't been for me."
He admitted that William Cook had met the financial targets attached to his performance-related bonus "every year". But he added :"I could have doubled my salary but I've never paid myself anything of that magnitude in the past because I have exercised restraint."
Mr Cook also moved to head off criticism of his autocratic style of management by announcing plans to split the role of chairman and chief executive and to appoint at least one new non-executive director if the Triplex Lloyd bid lapses.
"If the company's value has been depressed because I am not what I should be corporate governance-wise then I am going to have to change," he said. "I have agreed to eliminate this issue by adopting best practice so it doesn't muddy the waters."
William Cook forecast a "substantial improvement" in profits for the year to March 1997 and claimed it is worth twice Triplex Lloyd's 312p cash and shares bid.
The forecast was immediately attacked by Triplex Lloyd. Noting remarks made by Mr Cook at the interim stage about a "blip" in order books chief executive, Graham Lockyer, said:
"The miracle that has occurred in the past six weeks is unbelievable. Paul Daniels would be proud of him."Reuse content