One bargain you won’t find at your local Kohl’s…

This morning, retailers are reporting same store sales for November and it reminded us of this 8k that Kohl’s (KSS) filed two weeks ago, which had one of the more unusual disclosures we’re seen in awhile.

In the filing, as well as in a corresponding Form 4, Kohl’s said that its human resources department had made a mistake back in April 2004 that wound up costing Chairman Lawrence Montgomery $5 million. So 4 1/2 years after the fact, it decided to give him 250,000 new options at $27.45 a share — the price that the stock closed at on Nov. 17. Here’s a snippet from the filing:

This grant was made to compensate Mr. Montgomery for losses he suffered in April 2004 due to an administrative error by the Company’s Human Resources staff. At the time, it was Company policy that the Human Resources staff was responsible for keeping senior executive officers informed of upcoming option expiration dates and facilitating the exercise of those options. As a result of incorrect information provided to Mr. Montgomery, 120,000 of Mr. Montgomery’s vested, in-the-money stock options expired without his knowledge.

At the time, we thought the disclosure of something the company called “corrective options” — kind of like corrective lenses, we’re guessing — seemed a bit odd. But a quick skim of Kohl’s chart for the past year shows some pretty lucky timing, especially since the company never says exactly when it discovered this $5 million mistake. While Kohl’s stock fell a bit further — closing at $24.98 on Nov. 20 — it has rebounded since then, making those options much more valuable. Even today’s seemingly disappointing same store sales, which declined 17.5% in November, hasn’t had an impact.

But don’t go looking for a similar deal at your local Kohl’s. You can clip coupons and search through the 80% off racks, but you won’t be able to find it.