Mr Pykett accepted a payment of pounds 100,000 in full settlement of his claims against the company at an industrial tribunal. He had claimed almost pounds 1m in damages for the termination of his three-year rolling contract, based on his annual remuneration package of around pounds 300,000.
Mr Pykett joined Cowie in 1984 when it acquired Hangar Group. As managing director of Cowie's car leasing division he had been seen as an eventual successor to the group chief executive, Gordon Hodgson, who reached the age of 65 last year. But he was told in January last year that he would only be considered with other candidates.
Last October Mr Pykett told the board that he no longer felt fully motivated in his job and wished to resign. At the time his division accounted for 50 per cent of group profits and the company created a monitoring committee to keep tabs on Mr Pykett, which he refused to acknowledge.
In December Mr Pykett asked to sell his holding of 118,790 shares but was refused permission to do so by the chairman, Sir James McKinnon, on the grounds that it was inappropriate for a director to deal in the shares at a time when the company was bidding for a number of bus and rail franchises and its bid for British Bus had been referred to the Monopolies & Mergers Commission.
Mr Pykett replied that he would hold the company responsible for any loss he suffered on subsequent disposal. The company convened a disciplinary committee, claiming Mr Pykett had put personal interest above those of the company and sacked him for misconduct. In March this year the company sent a letter to shareholders convening a meeting to seek his removal. Mr Pykett resigned just hours before the meeting.
Cowie's shares closed 6p higher at 353.5p last night.