UNITED STATES SHOE CORP, SC 14D1/A, 1995-03-07

UNITED STATES SHOE CORP
SC 14D1/A, 1995-03-07
WOMEN'S CLOTHING STORES

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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------
SCHEDULE 14D-1
TENDER OFFER STATEMENT
PURSUANT TO SECTION 14(D)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 1)
THE UNITED STATES SHOE CORPORATION
(Name of Subject Company)

--------------
LUXOTTICA GROUP S.P.A.
LUXOTTICA ACQUISITION CORP.
(Bidders)
--------------
COMMON SHARES, WITHOUT PAR VALUE
(INCLUDING THE ASSOCIATED PREFERENCE SHARE PURCHASE RIGHTS)
(Title of Class of Securities)
912605102
(CUSIP Number of Class of Securities)

CLAUDIO DEL VECCHIO
44 HARBOR PARK DRIVE
PORT WASHINGTON, NEW YORK 11050
(516) 484-3800

(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of Bidders)
WITH A COPY TO:
JONATHAN GOLDSTEIN
WINSTON & STRAWN
175 WATER STREET
NEW YORK, NEW YORK 10038
(212) 269-2500
CALCULATION OF FILING FEE
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- --------------------------------------------------------------------------------
TRANSACTION VALUATION* $1,201,654,248 AMOUNT OF FILING FEE** $240,330.85
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- --------------------------------------------------------------------------------

* Pursuant to, and as provided by, Rule 0-11(d), this amount is based upon the
purchase of 50,068,927 Common Shares of the Subject Company and the
associated Rights at $24.00 cash per share, which is equal to the sum of (i)
the number of Shares outstanding as reported in the Quarterly Report on Form
10-Q of the Subject Company for the quarter ended October 29, 1994 and (ii)
the number of Shares subject to outstanding options as reported in the Annual
Report on Form 10-K of the Subject Company for the fiscal year ended January
29, 1994.

** 1/50 of 1% of Transaction Valuation.

X Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and
identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the Form or
Schedule and the date of its filing.

Amount Previously Paid: $240,330.85

Form or Registration No.: Schedule 14D-1

Filing Party: Luxottica Group S.p.A.; Luxottica Acquisition Corp.

Date Filed: March 3, 1995
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Page 1 of 4 Pages
The Exhibit Index is located on Page 4
<PAGE>
Luxottica Group S.p.A. and Luxottica Acquisition Corp. hereby amend and
supplement their Tender Offer Statement on Schedule 14D-1, filed on March 3,
1995, with respect to the Offer to Purchase all of the outstanding Common
Shares, without par value, of The United States Shoe Corporation, including the
associated preference share purchase rights, as set forth in this Amendment No.
1.

Item 10 is hereby amended to add the following:

ITEM 10. ADDITIONAL INFORMATION

(e) On March 6, 1995, the action brought by the Purchaser and Parent on
March 3, 1995 in the United States District Court for the Southern District
of Ohio, Eastern Division, was amended to, among other things, add
Avant-Garde Optics, Inc., a wholly owned subsidiary of Parent, as a
plaintiff.

As described in the Offer to Purchase, Parent and the Purchaser
submitted certain information relating to the Offer to the Ohio Division on
March 3, 1995 pursuant to the Ohio Take-Over Act. Under such Act, the Ohio
Division is vested with authority to take action within three calendar days
of such submission to summarily suspend the continuation of the Offer. The
Ohio Division did not issue any order to suspend the continuation of the
Offer prior to the expiration of such three day period.

Item 11 is hereby amended and supplemented by adding the following exhibits:

ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.

<TABLE>
<S> <C>
(a)(9) --Preliminary Proxy Statement dated March 6, 1995 of Luxottica Group S.p.A. and
Luxottica Acquisition Corp. for the Special Meeting of Shareholders under
Section 1701.831 of the Ohio Revised Code of The United States Shoe Corporation,
together with the form of Proxy relating thereto, as filed with the Securities
and Exchange Commission on March 6, 1995 and incorporated herein by reference.
(a)(10) --Preliminary Solicitation Statement dated March 7, 1995 of Luxottica Group S.p.A.
and Luxottica Acquisition Corp. to call a Special Meeting of Shareholders of The
United States Shoe Corporation, together with the form of Appointment of
Designated Agents relating thereto, as filed with the Securities and Exchange
Commission on March 7, 1995 and incorporated herein by reference.
(g)(2) --First Amended Verified Complaint seeking Declaratory and Injunctive Relief filed
by Luxottica Group S.p.A., Luxottica Acquisition Corp. and Avant-Garde Optics,
Inc. in the United States District Court for the Southern District of Ohio,
Eastern Division, on March 6, 1995, relating to the Ohio Take-Over Act, the
Preference Share Purchase Rights and the impairment of the voting rights of
certain Shares under Sections 1701.01(CC)(2) and 1701.831 of the Ohio Revised
Code.
</TABLE>

2
<PAGE>
SIGNATURES

After due inquiry and to the best of my knowledge and belief, the
undersigned certify that the information set forth in this statement is true,
complete and correct.

LUXOTTICA GROUP S.P.A.

Dated: March 7, 1995 By: /s/ Claudio Del Vecchio
..............................
Claudio Del Vecchio
Managing Director

LUXOTTICA ACQUISITION CORP.

Dated: March 7, 1995 By: /s/ Claudio Del Vecchio
..............................
Claudio Del Vecchio
President

3
<PAGE>
EXHIBIT INDEX

<TABLE><CAPTION>
EXHIBIT PAGE
- ------- ----
<S> <C> <C>
(a)(1) --Offer to Purchase, dated March 3, 1995..................................... *

(a)(2) --Letter of Transmittal...................................................... *

(a)(3) --Notice of Guaranteed Delivery.............................................. *

(a)(4) --Letter from the Dealer Manager to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees............................................... *

(a)(5) --Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees............................................... *

(a)(6) --Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9........................................................ *

(a)(7) --Summary Advertisement as published in The Wall Street Journal on March 3,
1995....................................................................... *

(a)(8) --Text of Press Release issued by Parent, dated March 3, 1995................ *

(a)(9) --Preliminary Proxy Statement dated March 6, 1995 of Luxottica Group S.p.A.
and Luxottica Acquisition Corp. for the Special Meeting of Shareholders
under Section 1701.831 of the Ohio Revised Code of The United States Shoe
Corporation, together with the form of Proxy relating thereto, as filed
with the Securities and Exchange Commission on March 6, 1995 and
incorporated herein by reference.

(a)(10) --Preliminary Solicitation Statement dated March 7, 1995 of Luxottica Group
S.p.A. and Luxottica Acquisition Corp. to call a Special Meeting of
Shareholders of The United States Shoe Corporation, together with the form
of Appointment of Designated Agents relating thereto, as filed with the
Securities and Exchange Commission on March 7, 1995 and incorporated herein
by reference.

(b)(1) --Commitment Letter, dated March 2, 1995, from Credit Suisse................. *

(g)(1) --Complaint Seeking Declaratory and Injunctive Relief filed in the United
States District Court for the Southern District of Ohio, Eastern Division,
on March 3, 1995, relating to the Ohio Take-Over Act, the Preference Share
Purchase Rights and the impairment of the voting rights of certain Shares
under Sections 1701.01(CC)(2) and 1701.831 of the Ohio Revised Code........ *

(g)(2) --First Amended Verified Complaint seeking Declaratory and Injunctive Relief
filed by Luxottica Group S.p.A., Luxottica Acquisition Corp. and
Avant-Garde Optics, Inc. in the United States District Court for the
Southern District of Ohio, Eastern Division, on March 6, 1995, relating to
the Ohio Take-Over Act, the Preference Share Purchase Rights and the
impairment of the voting rights of certain Shares under Sections
1701.01(CC)(2) and 1701.831 of the Ohio Revised Code.
</TABLE>

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* Previously filed.

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION

LUXOTTICA GROUP S.p.A., :
Via Valcozzena 10, :
32021 Agordo :
(Belluno) Italy, :
:
and :
:
LUXOTTICA ACQUISITION CORP., :
1209 Orange Street :
Wilmington, Delaware 19801 :
c/o Corporation Trust Company, :
:
and :
:
AVANT-GARDE OPTICS, INC., :
44 Harbor Park Drive :
Port Washington, New York 11050, :
:
Plaintiffs, :
:
v. : Civil Action No. C-2-95-244
:
:
: Judge Graham
THE UNITED STATES SHOE :
CORPORATION, :
One Eastwood Drive :
Cincinnati, Ohio 45227, :
:
and :
:
JOSEPH H. ANDERER, :
c/o The United States Shoe :
Corporation :
One Eastwood Drive :
Cincinnati, Ohio 45227, :
:
and :
:
PHILIP E. BEEKMAN, :
5402 E. Galbraith :
Cincinnati, Ohio 45236, :
:
and :
:
GILBERT HAHN, JR., :
c/o The United States Shoe :
Corporation :
One Eastwood Drive :
Cincinnati, Ohio 45227, :

<PAGE>

and :
:
ROGER L. HOWE, :
6450 Given Road :
Indian Hills, Ohio 45243, :
:
:
and :
:
BANNUS B. HUDSON, :
1136 Fort View Place :
Cincinnati, Ohio 45202-1713, :
:
and :
:
LORRENCE KELLAR, :
2167 Grandin Road :
Cincinnati, Ohio 45208-3359, :
:
and :
:
ALBERT M. KRONICK, :
35 Prospect Park S.W. :
Brooklyn, New York 11215-5902, :
:
and :
:
THOMAS LACO, :
9075 Cunningham Road :
Cincinnati, Ohio 45243-1503, :
:
and :
:
CHARLES S. MECHEM, JR., :
6225 Redbirdhollow Lane :
Cincinnati, Ohio 45243-3352, :
:
and :
:
JOHN L. ROY, :
5089 Signal Hill Lane :
Cincinnati, Ohio 45244, :
:
and :

<PAGE>

PHYLLIS S. SEWELL, :
c/o The United States Shoe :
Corporation :
One Eastwood Drive :
Cincinnati, Ohio 45227, :
:
and :
:
MARK HOLDERMAN, :
Commissioner of Securities :
Ohio Division of Securities :
South High Street :
Columbus, Ohio 43266-0548, :
:
and :
:
DONNA OWENS, :
Director of Commerce :
Department of Commerce :
of the State of Ohio :
South High Street :
Columbus, Ohio 43266-0548, :
:
and :
:
STATE OF OHIO, :
c/o Betty D. Montgomery :
Attorney General of Ohio :
State Office Tower :
East Broad Street :
Columbus, Ohio 43215, :
:
Defendants. :

<PAGE>
FIRST AMENDED
VERIFIED COMPLAINT FOR TEMPORARY RESTRAINING
ORDER AND FOR PRELIMINARY AND PERMANENT
INJUNCTIVE RELIEF AND DECLARATORY JUDGMENT
------------------------------------------

Plaintiffs, by their undersigned attorneys, as and for

their First Amended complaint herein, aver upon knowledge as to

themselves and upon information and belief as to all other

matters as follows:

NATURE OF THIS ACTION

1. Plaintiffs seek (a) temporary, preliminary and

permanent injunctive relief, pursuant to Rule 65, Fed. R. Civ.

P., against the enforcement of the Ohio Take-Over Act, Ohio Rev.

Code Sec. Sec. 1707.041, 1707.042, 1707.23 and 1707.26 (the

"Take-Over Act"), which purports to regulate nationwide tender offers

governed by federal law; (b) preliminary and permanent injunctive

relief prohibiting application of certain provisions of the Ohio

Control Share Acquisition Act set forth in Division (E)(1) of

Ohio Rev. Code Sec. 1701.831 (the "Control Share Acquisition Act"),

by virtue of Ohio Rev. Code Sec. 1701.01(CC)(2), by defendants to

impair the voting rights of holders of certain of U.S. Shoe's

Common Shares; and (c) preliminary and permanent injunctive

relief prohibiting U.S. Shoe and its directors from taking any

steps to enforce or amend the Preference Share Purchase Rights

Agreement, commonly referred to as the "Poison Pill Plan" [except

to redeem the rights issued thereunder (the "Rights")] and

directing U.S. Shoe and its directors to redeem all Rights issued

pursuant to U.S. Shoe's Poison Pill Plan, as defined hereinafter.

<PAGE>

2. Plaintiffs seek a declaratory judgment pursuant to

28 U.S.C. Sec. 2201 and Rule 57, Fed. R. Civ. P., declaring that (a)

the Take-Over Act is unconstitutional to the extent it is sought

to be applied to the proposed acquisition by Plaintiffs of all of

the outstanding Common Shares of U.S. Shoe; (b) the Control Share

Acquisition Act is unconstitutional to the extent it is sought to

be applied to impair the voting rights of holders of U.S. Shoe's

Common Shares described in Ohio Rev. Code Sec. 1701.01(CC)(2); and

are invalid, unlawful, null and void.

PARTIES
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3. Plaintiff, Luxottica Group S.p.A. ("Luxottica

Group"), is a corporation organized under the laws of the

Republic of Italy with its principal place of business in

Belluno, Italy. Luxottica Group and Luxottica Acquisition Corp.

("Luxottica Acquisition"), a Delaware corporation and an indirect

wholly-owned subsidiary of Luxottica Group, announced and

commenced a nationwide cash tender offer for all of the

outstanding Common Shares of U.S. Shoe ("hereinafter collectively

referred to as "Offeror Plaintiffs").

4. Plaintiff Avant-Garde Optics, Inc. ("Avant-Garde")

is a corporation organized under the laws of New York with its

principal place of business in New York. Avant-Garde is a wholly

owned subsidiary of Luxottica Group, and has been a shareholder

of U.S. Shoe since November 7, 1994. Avant-Garde is a Plaintiff

as to Counts Six through Eight.

5. Defendant The United States Shoe Corporation

("U.S. Shoe") is an Ohio corporation with its principal executive

offices in Cincinnati, Ohio.

<PAGE>
6. Defendants Anderer, Beekman, Hahn, Howe, Hudson,

Kellar, Kronick, Laco, Mechem, Roy and Sewell are directors of

U.S. Shoe (the "Directors"), and each is a citizen of states

other than Delaware.

7. Defendant Mark Holderman (the "Commissioner") is a

citizen and resident of Ohio and is the Commissioner of the Di-

vision of Securities, Department of Commerce of the State of Ohio

(the "Division"). Pursuant to Ohio Rev. Code Sec. 1707.46, the

Division is charged with the enforcement of all laws and rules

enacted to regulate the sale of securities. In the enforcement

of those laws, the Commissioner is empowered, inter alia, to
----- ----

conduct hearings and investigations (Ohio Rev. Code Sec.Sec.

1707.041, 1707.23), issue cease and desist orders (Ohio Rev. Code

Sec. 1707.23) and seek court-ordered injunctive relief (Ohio Rev.

Code Sec.Sec. 1707.23, 1707.26). Further, the Commissioner is

empowered, pursuant to Ohio Rev. Code Sec. 1707.23(E) and (H),

to enforce certain criminal provisions and may refer certain

enforcement matters to the Attorney General and the Prosecuting

Attorney.

8. Defendant Donna Owens is a citizen and resident of

Ohio and is the Director of Commerce, Ohio Department of

Commerce. The Department of Commerce has authority to enforce

provisions of the Take-Over Act.

9. The State of Ohio is being made a defendant herein

by and through Betty D. Montgomery, the Attorney General of Ohio.

JURISDICTION AND VENUE
----------------------

10. This action arises under (a) Sections 14(a),

14(d), 14(e) and 28 of the Securities Exchange Act of 1934 (the

"Exchange Act"), 15 U.S.C. Sec.Sec. 78(a), 78n(d), 78n(e) and

78bb, and the rules and regulations promulgated thereunder

by the Securities and Exchange

<PAGE>

Commission (the "SEC"), 17 C.F.R. Sec.Sec. 240.14d-1 et seq.;
-- ---
and (b) the Commerce Clause, Article I, Section 8, Clause 3,

the Impairment of Contracts Clause, Article I, Section 10, the

Supremacy Clause, Article VI, Clause 2 and the due process clause

of the Fourteenth Amendment of the United States Constitution and

42 U.S.C. Sec. 1983.

11. This Court has subject matter jurisdiction over

this action pursuant to (a) Section 27 of the Exchange Act,

15 U.S.C. Sec. 78aa; (b) 28 U.S.C. Sec. 1331(a)(federal question);

Sec.1337(a) (commerce and antitrust regulation); (e) 28 U.S.C.

Sec. 1343(a) (deprivation of constitutional rights); and

(f) 28 U.S.C. 1367 (supplemental jurisdiction). Plaintiffs

and defendants are of diverse citizenship, and the amount in

controversy, exclusive of interest and costs, exceeds $50,000.

Further, this Court has pendent jurisdiction over the state law

claims.
12. Venue is proper in this judicial district pursuant

to 28 U.S.C. Sec. 1391(b) and (c) because all of the defendants

reside in or are subject to personal jurisdiction in this

district and the claims asserted herein arise from events and/or

omissions in this District; and pursuant to Section 27 of the

Exchange Act, 15 U.S.C. Sec. 78aa, because acts or transactions

constituting violations of the Exchange Act have occurred or are

threatened to occur in this District, and the defendants are in,

inhabit or transact business in this district. Venue in this

division is proper pursuant to Rule 3.3(c) of the S.D. Ohio L.R.

because defendants Holderman and Owens reside, and the cause of

action arose, in this division.

THE TENDER OFFER
----------------

13. In telephone calls in December, 1994 and a meeting

in January, 1995, Luxottica Group advised senior management of

U.S. Shoe that Luxottica Group proposed to

<PAGE>
acquire U.S. Shoe by means of an all cash merger involving

payment to U.S. Shoe's shareholders of a substantial premium

above the then current market value of U.S. Shoe's Common Shares,

and wished to engage in negotiations to effectuate such a

transaction. The financial advisors of Luxottica Group and

U.S. Shoe also held several meetings during this period in which

Luxottica Group's financial advisors reiterated the merger

proposal.

14. Luxottica Group advised U.S. Shoe that it wished

access to non-public information about U.S. Shoe's businesses to

offer a fully-valued cash merger proposal. However, U.S. Shoe

and Plaintiffs were unable to agree on the terms of a standstill.

15. In light of U.S. Shoe's response to Luxottica

Group's friendly overtures, Luxottica Group decided to make an

offer directly to U.S. Shoe's shareholders.

16. Accordingly, Offeror Plaintiffs commenced on March

3, 1995, a cash tender offer (the "Tender Offer") for all of the

outstanding shares of U.S. Shoe at a price of $24.00 per share.

17. The Tender Offer represents a substantial

transaction in interstate commerce totaling more than

$1,201,654,248. The Tender Offer is being made to all of U.S.

Shoe's shareholders, who are widely dispersed throughout the

United States, with the majority located outside the State of

Ohio. The offer is fair, reasonable and adequate. Further, it

is not coercive. It is for all shares. If the Tender Offer

is successful, Offeror Plaintiffs intend, as soon as practicable,

to consummate a merger and to acquire at the same price all

remaining shares not tendered in the Tender Offer.

18. The Tender Offer complies in all respects with the

detailed substantive and disclosure requirements of federal law,

which comprehensively regulate nationwide tender offers,

including, among other things, the Exchange Act and certain

amendments thereto (the "Williams

<PAGE>
Act"), and rules and regulations promulgated by the SEC pursuant

to Congressional authorization. Offeror Plaintiffs are filing a

Schedule 14D-1 with the SEC with respect to the Tender Offer

which contains, among other exhibits, an Offer to Purchase

setting forth the material terms of the Tender Offer. Offeror

Plaintiffs are also filing a Form 041 together with the aforesaid

Schedule 14D-1, the Offer to Purchase and all other exhibits

thereto, with the Division, without prejudice to Offeror

Plaintiffs' position that the Take-Over Act is unconstitutional

or inapplicable to the Tender Offer. In addition, Offeror

Plaintiffs are delivering an Acquiring Person Statement

to U.S. Shoe pursuant to the Control Share Acquisition Act,

without prejudice to Offeror Plaintiffs' position that the

Control Share Acquisition Act is unconstitutional to the extent

it is applied to impair certain voting rights.

FEDERAL REGULATION OF THE TENDER OFFER
--------------------------------------

19. In 1968, Congress enacted the Williams Act

amendments to the Exchange Act and thereby established a uniform

national system, administered by the SEC, for regulation of

interstate tender offers. The provisions of the Williams Act,

and the rules promulgated thereunder by the SEC, represent a

comprehensive Congressional scheme which regulates nationwide

tender offers.

20. In enacting the Williams Act, Congress recognized

that tender offers serve legitimate and beneficial economic

functions by, among other things, providing investors with an

opportunity to sell their shares at an advantageous premium over

the prevailing market prices and providing shareholders with all

information material to their respective decisions whether or not

to tender their shares.

<PAGE>

21. The Williams Act reflects the intent of Congress

that interstate tender offers for shares of public corporations

should succeed or fail solely at the hands of the free and

informed investment judgment of the individual shareholders of

such corporations. The Williams Act is designed neither to deter

nor to encourage tender offers, but rather to establish

evenhanded regulation, favoring neither the tender offeror nor

incumbent management of the corporation whose securities are

being sought. The goals of the Williams Act are shareholder

protection and strict neutrality in the contest for corporate

control between management of the target company and the tender

offeror.

22. The Williams Act protects investors by requiring

that tender offerors provide shareholders with certain

information which Congress has determined to be material to an

informed investment judgment as to whether an individual

shareholder should hold, sell or trade his securities and by

requiring that tender offerors observe specified timetable

requirements in connection with all tender offers for securities

registered under the Exchange Act.

23. Pursuant to its authority under Section 23(a)(1)

and other provisions of the Exchange Act, the SEC has promulgated

rules and regulations in furtherance of the comprehensive

Congressional scheme set forth in the Williams Act and in other

provisions of the Exchange Act. Federal law establishes a

specific regulatory scheme and timetable which apply to the

Tender Offer. The Williams Act does not contain any provisions

that would substantially delay or restrict a tender offer, or

permit administrative review respecting the fairness of its

substantive terms or the effectiveness of tender offer

disclosures.

THE OHIO TAKE-OVER ACT
----------------------

<PAGE>

24. The Take-Over Act, Ohio Rev. Code Sec. 1701.041,

was originally enacted in 1969 and amended in 1990. It purports

to regulate interstate tender offers.

25. Under the Take-Over Act, a "control bid" is

defined to include an offer to acquire equity securities of a

corporation incorporated inside or outside Ohio with its

principal place of business or principal executive office in Ohio

or with substantial assets within Ohio if there are a certain

specified number of Ohio shareholders. Ohio Rev. Code Sec.

Sec. 1707.01(V)(1); 1707.01(Z)(1).

26. While the Take-Over Act requires disclosure which

is, in part, duplicative of that required under federal law, the

information filed with the Division and to be delivered to the

subject company and Ohio offerees must also include information

which need not be disclosed in a Schedule 14D-1 filed with the

SEC pursuant to the Williams Act, such as:

(a) information regarding plans or
proposals of the offeror to make
changes in employee plans or
workforce or to close plants or
facilities. Sec.1707.041(A)(2)(d).

(b) complete information on the
organization and operations of
offeror, including

(i) a description of the offeror's
outstanding capital stock and
long-term debt,

(ii) financial statements of the
offeror for the current period
and three most recent annual
accounting periods,

(iii) a description of the loca-
tion and general character of
offeror's principal physical
properties,

(iv) a description of pending legal
proceedings other than routine
litigation,

<PAGE>

(v) a description of the business
done and projected by the
offeror and the general
development of offeror's
business over the past three
years, and

(vi) the amount of any material
interest, direct or indirect,
of any of offeror's officers
or directors in any material
transaction during the past
three years, or any proposed
transactions, to which the
offeror was or is to be a
party. Sec. 1707.041(A)(2)(g).

(c) "[s]uch other and further
documents, exhibits, data, and
information as may be required by
regulations of the division of
securities, or as may be necessary
to make fair, full and effective
disclosure to offerees of all in-
formation material to a decision to
accept or reject the offer." Sec.
1707.041(A)(2)(h).

27. The Take-Over Act impermissibly imposes burdens

upon offerors, such as Luxottica Acquisition, in conflict with

the Williams Act, 15 U.S.C. Sec. 78n(d), (e) (to which the Tender

Offer is subject), and the regulations promulgated thereunder, to

the extent that the Take-Over Act requires that offerors provide

to the company being acquired, the Division and Ohio offerees,

materials which include, among other things, information with

respect to the financial condition and history of the offerors;

plans relating to employees; and a general open-ended requirement

for additional information, beyond the requirements of the

Williams Act. Ohio Rev. Code Sec. 1707.041(A)(2).

28. The Take-Over Act allows the Division, by rule or

in an adjudicatory proceeding, to determine that an issuer is not

a "subject company" if "appropriate review" of the control bid

will be made by a regulatory authority of another jurisdiction.

Ohio Rev. Code Sec. 1707.01(Z)(2).

<PAGE>

29. The Division may "summarily suspend the

continuation of the control bid." Further, the Division may

effectively block the Tender Offer from going forward if, after a

hearing, it determines that "all of the information required to

be provided . . . has not been provided by the offeror, that the

control bid materials provided to offerees do not provide full

disclosure to offerees of all material information concerning the

control bid, or that the control bid is in material violation of

any provision of this chapter . . ." Ohio Rev. Code Sec.

1707.041(A)(4).

30. The contemplated "suspension" of Offeror

Plaintiffs' control bid, both summarily and after hearing, would

have the practical effect of impeding, and possibly halting, the

Tender Offer throughout the nation. Reinstitution of the offer

can be accomplished only by filing "new or amended information"

to correct "disclosure and other deficiencies." Ohio Rev. Code

Sec. 1707.041(A)(4).

31. These provisions are in direct contravention of

the Williams Act, which does not contemplate any substantive

administrative review of the "effectiveness" of tender offer

disclosures or of "other deficiencies". These provisions also

conflict with the explicit timetable of the Williams Act.

THE CONTROL SHARE ACQUISITION ACT
---------------------------------

32. Ohio Rev. Code Sec. 1701.831 regulates the making

of "control share acquisitions" as defined in Ohio Rev. Code Sec.

1701.01(Z)(1). Offeror Plaintiffs' Tender Offer to acquire all

of the shares of U.S. Shoe for cash proposes a control share

acquisition. Within ten days of receipt of an Acquiring Person

Statement delivered to U.S. Shoe pursuant to Ohio Rev. Code

Sec. 1701.831(B), defendant Directors of U.S. Shoe must call a

special meeting (the "831 Special Meeting") of shareholders to

vote on the proposed control share acquisition.

<PAGE>

33. Under Ohio Rev. Code Sec. 1701.831, the Tender

Offer can only be consummated if the shareholders of U.S. Shoe

approve the proposed control share acquisition by the affirmative

vote of a majority of the voting power of U.S. Shoe in the

election of directors represented at the 831 Special Meeting in

person or by proxy and a majority of the portion of such

voting power excluding the voting power of "interested shares"

[as defined in Ohio Rev. Code Sec. 1701.01(CC)]. A quorum must be

present at the 831 Special Meeting and will be deemed present if a

majority of the voting power of U.S. Shoe in the election of

directors and majority of such voting power excluding "interested

shares" are represented at the meeting in person or by proxy.

34. According to Ohio Rev. Code Sec. 1701.832 the

procedures in Sec. 1701.831 are to provide ". . . evenhanded

protection of offerors and shareholders from fraudulent and

manipulative transactions arising in connection with control

acquisitions." "Evenhanded protection" requires that the share-

holder vote in Sec. 1701.831 must treat offerors and incumbent

management evenhandedly and must be bona fide and achievable. If

the vote cannot be calculated, or cannot be calculated in a

timely manner, the voting requirements are a blatant sham

designed to enable entrenched management to avoid a shareholder

referendum on the Tender Offer and kill fair, all-cash, non-

manipulative tender offers or stymie them indefinitely.

35. Ohio Rev. Code Sec. 1701.01(CC)(2), a 1990 amend-

ment, presents insurmountable barriers to any and all control

share acquisitions of the shares of widely held public companies,

such as U.S. Shoe, by creating a class of "interested shares"

which, as a practical matter, is impossible to determine.

36. Ohio Rev. Code Sec. 1701.01(CC)(2) provides:

<PAGE>

"Interested shares" also means any shares of
------------------------------------------
an issuing public corporation acquired,
---------
directly or indirectly, by any person from
-----------------------
the holder or holders thereof for a valuable
consideration during the period beginning
------------------------------
with the date of the first public disclosure
---------------------------------------------
of a proposed control share acquisition of
---------------------------------------------
the issuing public corporation or any
---------------------------------------------
proposed merger, consolidation, or other
---------------------------------------------
transaction which would result in a change in
---------------------------------------------
control of the corporation or all or
-------
substantially all of its assets, and ending
------
on the date of any special meeting of the
-------------------------------------
corporation's shareholders held thereafter
pursuant to section 1701.831 [1701.83.1] of
-----------------------------
the Revised Code, for the purpose of voting
on a control share acquisition proposed by
any acquiring person if either of the
----------
following apply:

(a) The aggregate consideration paid or
-------------------------------
given by the person who acquired the shares,
--------------------------------------
and any other persons acting in concert with
-------------------------------
him, for all such shares exceeds two hundred
-------------------
fifty thousand dollars;
----------------------

(b) The number of shares acquired by the
-----------------------------------
person who acquired the shares, and any other
------ ---------
persons acting in concert with him, exceeds
-------------------------- -------
one-half of one per cent of the outstanding
-------------------------
shares of the corporation entitled to vote in
the election of directors. (Emphasis added).

37. Any shares of U.S. Shoe that are "interested

shares" under Ohio Rev. Code Sec. 1701.01(CC)(2) cannot be

determined from the shareholder records of U.S. Shoe required to

be maintained under Ohio Rev. Code Sec. 1701.37 because such re-

cords disclose the names and addresses of record holders only,

who may or may not also be the beneficial owners of such shares.

Even as to those record holders who are also beneficial owners,

the records do not contain the information necessary to determine

whether the shares are "interested shares" under the provisions

of Ohio Rev. Code Sec. 1701.01(CC)(2).

38. It is estimated that at least 80% of U.S. Shoe's

outstanding shares are held by clearing agencies and by brokers

and banks as record holders for the beneficial owners using

"street" or nominee names. Such brokers, banks and clearing

agencies hold shares for many beneficial owners, including

arbitrageurs. Arbitrageurs buy and sell significant amounts of

shares
15

<PAGE>

of widely held public companies, like U.S. Shoe, after

tender offer announcements. They frequently do not consent to

disclosure of their names, addresses and holdings. Neither U.S.

Shoe nor Luxottica Acquisition can compel the record share-

holders to disclose the name, address or holdings of the

numerous non-consenting beneficial owners of shares, the prices

paid by them for shares, when such shares were purchased or

whether they are "acting in concert" with any other person, and

yet this unavailable information must be obtained in order to

identify the class of "interested shares" created by Ohio Rev.

Code Sec. 1701.01(CC)(2). Thus, this provision presents insur-

mountable difficulties in tallying "interested shares" and,

accordingly, shares that are not "interested." Moreover, it is
---
a practical impossibility to determine whether there is a

quorum or to determine the vote on the proposed control share

acquisition, which makes it impossible to comply with the

statutory requirement of obtaining approval of the Tender Offer

by separate majorities of the holders of "interested shares" and

the other shares of U.S. Shoe.

39. Section 14 of the Exchange Act and the regulations

promulgated thereunder (the "Proxy Rules") regulate the

solicitation of proxies and related matters with respect to

public companies such as U.S. Shoe.

40. Rules 14b-1(b)(3) and 14b-2(b)(4) of the Proxy

Rules require clearing agencies, securities brokers and banks

holding record ownership of stock for beneficial owners to

provide a public company such as U.S. Shoe, upon request of the

company, with the names, addresses and securities positions,

compiled as of a date no earlier than five business days after

such request is received, of its customers who are beneficial

owners of the company's securities and "who have not objected to
------------------------

disclosure of such 'information'." Thus, the Proxy Rules
-----------------------------------

recognize the right of a beneficial owner to keep his identity

confidential. In addition, the Proxy Rules create no right or

ability to compel disclosure by a beneficial owner of the price

paid by him

<PAGE>

for securities, the time of the purchases, the

identity of sellers or whether he is acting in concert with any

other person, all of which must be obtained to determine whether
---

shares of U.S. Shoe are "interested shares" under Ohio Rev. Code

Sec. 1701.01(CC)(2). Therefore, Sec. 1701.01(CC)(2) conflicts

with and is preempted by the Proxy Rules.

41. While some of this information could be obtained

from reports required to be filed by 5% shareholders under

Section 13 of the Exchange Act, Sec. 1701.01(CC)(2) applies to

a person holding as few as one-half of one percent of the

outstanding U.S. Shoe shares, so that Section 13 filings would

provide incomplete and non-dispositive information in determining

which U.S. Shoe shares are "interested shares." Thus, Sec.

1701.01(CC)(2) is also in conflict with the disclosure scheme of

Section 13 of the Exchange Act.

42. The Williams Act, and the regulations thereunder,

establish procedural rules to govern tender offers. U.S. Shoe

and Luxottica Acquisition are subject to the Williams Act. The

Williams Act strikes a careful balance between the interests of

offerors and target companies, and any state statute that upsets

this balance is preempted.

43. Ohio Rev. Code Sec. 1701.831(E)(1), by virtue of

Ohio Rev. Code Sec. 1701.01(CC)(2), operates to favor entrenched

management against offerors to the detriment of shareholders by

excluding, from one of the votes required under Sec. 1701.831,

certain shares of U.S. Shoe trading after the Tender Offer

announcement. It does not protect independent shareholders

against the contending parties and does not ensure collective

deliberation about the merits of tender offers; rather, it

deprives holders of independently-owned shares of U.S. Shoe of

their rightful voice in corporate affairs. Ohio Rev. Code Sec.

1701.01(CC)(2) excludes certain shares owned independently of

U.S. Shoe's management and Luxottica Acquisition from a crucial

vote and makes it impossible to determine whether a requisite

shareholder vote has been obtained.

<PAGE>

Thus, it impedes the operation of the special shareholder's

meeting intended to give to the offeror the opportunity to

present its offer to the shareholders and to shareholders the

opportunity to decide for themselves whether a change in control

should occur. Therefore, Ohio Rev. Code Sec. 1701.01(CC)(2)

frustrates the purposes of the Williams Act. Ohio Rev. Code Sec.

1701.01(CC)(2) also does not treat shares which trade after the

first announcement of a tender offer equally, thereby

discriminating against Luxottica Acquisition's Tender Offer in

favor of any later competing offer made by U.S. Shoe's management

or a "white knight" friendly to management. Shares purchased

after the announcement of Luxottica Acquisition's Tender Offer

are "interested shares" as to such Tender Offer but would not
---
be "interested shares" as to any other offer if such shares are

purchased prior to the announcement of the second offer. The

"evenhanded" approach mandated by Ohio Rev. Code Sec. 1701.832

and the Williams Act is frustrated by a scheme which favors

entrenched management to the detriment of U.S. Shoe's

shareholders.

44. The Ohio General Assembly demonstrated awareness

that the amendment of Ohio Rev. Code Sec. 1701.01, adding

division (CC)(2), was constitutionally dubious by specifically

adding a severability clause solely for that division, to apply

"if any part of this division is held to be illegal or invalid in

application . . ." Ohio Rev. Code Sec. 1701.01(CC)(3).

THE POISON PILL PLAN
--------------------

45. U.S. Shoe's Poison Pill Plan (denominated as the

"Preference Shares Purchase Rights") was initially adopted by

U.S. Shoe's Board of Directors on March 31, 1986, without

shareholder approval. On April 14, 1986, U.S. Shoe implemented

the Poison Pill Plan by distributing a dividend of one preference

share purchase right (i.e., a Right) for each outstanding share
----

of U.S. Shoe.

<PAGE>

46. On March 23, 1988, U.S. Shoe amended its Poison

Pill Plan, again acting without shareholder approval.

47. U.S. Shoe's Poison Pill Plan, both as initially

adopted and as amended, is designed to impose substantial

economic penalties on any entity, like Luxottica Acquisition,

that attempts to acquire U.S. Shoe in a transaction not approved

by U.S. Shoe's Board of Directors. Thus, the Poison Pill Plan

affords U.S. Shoe's Board the power effectively to prevent U.S.

Shoe's shareholders from receiving the benefits of Offeror

Plaintiffs' Tender Offer regardless of its merit or the desires

of U.S. Shoe's shareholders to sell their shares pursuant thereto.

48. U.S. Shoe's Poison Pill Plan, however, empowers

U.S. Shoe's Directors to redeem the Rights and remove the threat

of overwhelming dilution that they carry. U.S. Shoe's Board may

at its discretion redeem the Rights at the nominal price of five

cents ($0.05) per Right at any time on or prior to the time a

person together with its affiliates and associates, becomes the

beneficial owner of 20 percent or more of U.S. Shoe's outstanding

shares (an "Acquiring Person").

49. In its Offer to Purchase, Luxottica Acquisition

requested that U.S. Shoe's Board of Directors redeem the Rights.

Luxottica Acquisition believes that U.S. Shoe's Board will refuse

to redeem the Rights.

50. U.S. Shoe uses and maintains the Rights solely in

order to employ the "flip-over" and "flip-in" features of these

Rights, described hereinafter, which are designed to deter tender

offerors, like Luxottica Acquisition, whose offers have not been

approved by U.S. Shoe's Board of Directors.

51. As amended, U.S. Shoe's Rights may only be

transferred together with U.S. Shoe's Common Shares until the

"Distribution Date" which shall occur on the earlier of the

<PAGE>
day on which a public announcement of the fact that a person has

become an Acquiring Person is made by U.S. Shoe or such Acquiring

Person (the "Share Acquisition Date") or the close of business on

the tenth day (or such later date as a majority of U.S. Shoe's

"Continuing" Directors may determine) following the commencement

of, or first public announcement of an intention to make, a

tender or exchange offer which, if successful, would result in a

30 percent or more ownership interest of U.S. Shoe's outstanding

Common Shares.

52. According to U.S. Shoe's Poison Pill Plan, after

the Distribution Date, the Rights may be transferred separately

from the Common Shares to which they were initially attached.

From and after the Distribution Date, but prior to the triggering

of the "flip-over" or "flip-in" provisions of the Rights,

described below, each Right entitles its holders to purchase from

U.S. Shoe one one-hundredth (1/100th) of a Series A Preference

Share at an exercise price of $200.

53. The $200 exercise price of the Rights vastly

exceeds the economic value of the units of designated preference

shares into which they are initially convertible. This disparity

between the exercise price and the value of the fractional

preference share to be received makes it clear that the Rights

were never intended to be used to purchase the designated

preference shares.

54. The exercise price for such fractional preference

share is more than 10 times the market price at which the shares

of U.S. Shoe traded immediately prior to announcement of the

Tender Offer and is significantly higher than any price at which

the Board of Directors could reasonably believe the preference

shares might trade prior to the expiration of the Rights in 1996.

It is thus inconceivable that a Right would in fact ever be

exercised to acquire the fractional preference shares.

<PAGE>

55. According to U.S. Shoe's Poison Pill Plan, after

the Rights become exercisable and, unless the Rights are sooner

redeemed, in the event that U.S. Shoe were to be acquired in a

merger or other business combination or more than 50 percent of

the assets or earning power of U.S. Shoe and its subsidiaries

were sold or transferred, the "flip-over" provision of the Poison

Pill is triggered. In that event, the Poison Pill Plan provides

that each Right shall entitle its holder to purchase such number

of shares of the acquiring company's common stock having a market

value at the time of such transaction of two times the exercise
--- -----

price of the Right. In other words, when the Rights "flip-over"

into rights to purchase stock of the acquiring company, the

Rights holders may purchase shares of that company at half-price.

For example, a Right holder could purchase $100 worth of the

acquiring company's shares for only $50. This "flip-over"

feature of the Poison Pill Plan threatens a devastating

impairment of any potential acquirer's capital structure and, if

enforceable, makes tender offers impossible if not approved by

U.S. Shoe's directors.

56. The Poison Pill Plan has certain anti-takeover

effects in that the Rights will cause substantial dilution to the

ownership rights of any person who attempts to acquire U.S. Shoe

on terms not approved by U.S. Shoe's Board of Directors. This

dilution would impose substantial economic penalties on Offeror

Plaintiffs or any other person who attempts to take control of

U.S. Shoe in a transaction not approved by U.S. Shoe's Board of

Directors.

57. Now in the face of Luxottica Acquisition's all

cash, all shares, premium, noncoercive Tender Offer, U.S. Shoe's

Board of Directors likely will continue to refuse to redeem the

Rights despite Offeror Plaintiffs' demand that they do so. U.S.

Shoe's Board of Directors is employing the Poison Pill Plan to

obstruct Offeror Plaintiffs' valuable offer, to deny

<PAGE>

to U.S. Shoe's shareholders any meaningful opportunity to decide

for themselves whether to tender their shares, and to entrench

the incumbent Board.

58. The purported purpose of the Poison Pill Plan was

to protect the interests of U.S. Shoe's shareholders. Luxottica

Acquisition's all cash, all shares premium Tender Offer provides

for fair and equal treatment of all U.S. Shoe shareholders and is

not coercive. Consequently, U.S. Shoe's Poison Pill has no valid

application to Luxottica Acquisition's Tender Offer.

59. U.S. Shoe's Board of Directors has a fiduciary

duty to redeem the Rights to allow Luxottica Acquisition's Tender

Offer to proceed. Unless the Poison Pill is redeemed, U.S.

Shoe's shareholders may be denied the opportunity to exercise

their right to decide for themselves whether to accept the

benefits of Offeror Plaintiffs' Tender Offer.

60. According to U.S. Shoe's Poison Pill Plan, U.S.

Shoe's Poison Pill further provides that after the Rights become

exercisable and the "flip-in" provision of the Poison Pill is

triggered, each Rights Holder (other than the Acquiring Person)

becomes entitled to purchase Common Shares of U.S. Shoe having a

market value of two times the exercise price of the Right. In

other words, when the Rights "flip-in," the Rights Holders may

purchase Common Shares of U.S. Shoe at one-half of their fair

market value at the time of the transaction. Because the

Acquiring Person's Rights are rendered void when the Rights "flip

in," this feature of the Poison Pill discriminates against the

Acquiring Person by diluting and devaluing the Acquiring Person's

holdings in U.S. Shoe. Moreover, the Plan provides that in lieu

of issuing Common Shares, U.S. Shoe may, if a majority of the

continuing Directors determines that such action is necessary or

appropriate and not contrary to the interests of the holders of

the Rights, elect to issue or pay, upon the exercise of the

Rights, cash, property, or other securities, or any combination

thereof

<PAGE>

having a fair market value equal to the value of the Common

Shares which otherwise would have been issued.

61. The option to purchase one one-hundredth of a

Series A Preference Share in the event of a flip-in is an

illusory option, because the "flip-in" triggers a right to

purchase Common Shares, not fractional preference shares.

Because the Poison Pill Plan effectively grants options to

purchase Common Shares in the event of a "flip-in," it is invalid

under Ohio Rev. Code Sec. 1701.16 because U.S. Shoe does not have

sufficient authorized but unissued Common Shares to satisfy the

exercise of the Rights in such event and because the Poison Pill

Plan was never approved by U.S. Shoe shareholders.

62. U.S. Shoe's Amended Articles of Incorporation

currently authorize the issuance of 60,000,000 Common Shares.

According to U.S. Shoe's most recent Form 10-Q, the number of

Common Shares outstanding at October 29, 1994, was 46,341,660; in

addition, there were options to purchase 3,727,267 Common Shares.

Thus, on a fully diluted basis, there were only 9,931,073 Common

Shares available for issuance under the Poison Pill Plan as of

October 29, 1994. If the flip-in were triggered by Luxottica

Acquisition's Tender Offer, there are insufficient Common Shares

to satisfy the exercise of the Rights.

63. Since there are insufficient authorized but

unissued or treasury Common Shares to satisfy the exercise of the

Rights, the Rights are not options to purchase shares, but are in

actuality a right to receive a dividend in cash, property or

securities pursuant to Ohio Rev. Code Sec. 1701.33.

64. Under the terms of the Poison Pill Plan, shares

held by a holder of 20 percent or more of U.S. Shoe's outstanding

Common Shares (and those who purchase from him)

<PAGE>
are discriminatorily excluded from the dividend. Such a

discriminatory dividend is unlawful under Ohio Rev. Code

Sec. 1701.33.

65. Furthermore, the amount of the dividend U.S. Shoe

would be required to pay under the circumstances described, above

and beyond the proceeds to it from the payment by the Right

holders of the exercise price, would be in such an amount that it

(a) would exceed U.S. Shoe's surplus and render it insolvent, and

would therefore be unlawful under Ohio Rev. Code Sec. Sec.

1701.33(A) and 1701.33(C), (b) would likely violate U.S. Shoe's

existing debt covenants, (c) would render U.S. Shoe's directors

personally liable for repayment of the unlawful amounts under

Ohio Rev. Code Sec. 1701.95(A)(1), and (d) would constitute an

unlawful disposition of substantially all of U.S. Shoe's assets

under Ohio Rev. Code Sec. 1701.76 or a voluntary dissolution

under Ohio Rev. Code Sec. 1701.86, without the requisite approval

of the shareholders.

66. Under the terms of the Poison Pill Plan, the Plan

does not apply to "a tender or exchange offer for all

outstanding Common Shares at a price and on terms determined by

a majority of the members of the Board of Directors, who are not

officers of the Corporation, to be in the best interest of the

Corporation and its shareholders (other than the Person or any

Affiliate or Associate thereof on whose behalf the offer is

being made.")

67. The Directors of U.S. Shoe who are not officers

of the corporation should promptly determine that the cash

tender offer for all outstanding shares commenced by Luxottica

Acquisition is in the best interest of the corporation and its

shareholders, so that the Poison Pill Plan does not apply to

Luxottica Acquisition's Tender Offer. The failure to approve the

Tender Offer and render the Poison Pill Plan inapplicable would

constitute a breach of fiduciary duty, and may deny U.S. Shoe's

shareholders the opportunity to exercise their right to decide

for themselves whether to accept the benefits of Offeror

Plaintiffs' Tender Offer.

<PAGE>

CLAIMS FOR RELIEF
-----------------

The Take-Over Act Violates the Commerce
Clause of the United States Constitution
----------------------------------------

(COUNT ONE)

68. Plaintiffs repeat and reallege the averments set

forth in paragraphs 1-67 of this Complaint as if fully rewritten

herein.

69. The Commerce Clause of the United States

Constitution provides that: "Congress shall have power . . . to

regulate commerce . . . among the several states." U.S. Const.

Art. I, Sec. 8, cl. 3.

70. Shareholders of U.S. Shoe reside throughout the

United States and the Tender Offer will take place in interstate

commerce.

71. The Take-Over Act imposes a substantial, adverse,

and direct burden on interstate commerce because, among other

things, the Take-Over Act:

(a) grants to the Division power to
suspend the Tender Offer in the
State of Ohio which would
effectively prevent plaintiffs from
going forward with the Tender Offer
nationwide;

(b) imposes disclosure requirements
which exceed those required under
federal law;

(c) deprives Plaintiffs of the
federally-protected right to buy
securities from willing sellers
throughout the United States free
of state law impediments;

(d) exerts a powerful constraint upon
transactions in securities between
willing buyers and willing sellers
throughout the United States;

(e) impedes the infusion of billions of
dollars into interstate commerce by
means of tender offers and
interferes with efficient
allocation of economic resources;
and

25
<PAGE>

(f) creates unnecessary, duplicative
and wasteful expenses for companies
engaged in interstate commerce and
upon persons wishing to use the
national securities exchanges.

72. The Take-Over Act is invalid and unconstitutional

because it places a substantial burden on interstate commerce

which outweighs any putative local benefits, in violation of the

Commerce Clause, Art. I, Sec. 8, cl. 3, of the United States

Constitution.

73. Plaintiffs have no adequate remedy at law.

The Take-Over Act Violates the Supremacy
Clause of the United States Constitution
and Section 28 of the Exchange Act
----------------------------------

(COUNT TWO)

74. Plaintiffs repeat and reallege the averments set

forth in paragraphs 1-73 of this Complaint as if fully rewritten

herein.

75. The Supremacy Clause, U.S. Const. Art. VI, cl. 2,

provides, in pertinent part:

This Constitution, and the Laws of the United
States which shall be made in Pursuance
thereof . . . shall be the supreme Law of the
Land; and Judges in every State shall be
bound thereby, any Thing in the Constitution
or Laws of any State to the Contrary
notwithstanding.

76. The Take-Over Act frustrates the objectives of,

and is in direct conflict with, the Exchange Act and the rules

and regulations promulgated thereunder in at least the following

respects:

(a) The Take-Over Act imposes
disclosure requirements in addition
to those required by federal law;

<PAGE>

(b) the Division may prohibit a tender
offer from proceeding and thereby
frustrate the federal scheme which
provides for each shareholder to
decide whether to accept a tender
offer;

(c) the Take-Over Act represents an
attempt to assert the legislative
power of the State of Ohio over a
subject matter over which the
federal government has developed a
comprehensive body of law; and

(d) the Take-Over Act creates the
potential for unseemly conflict
between federal and state
proceedings by permitting a state
official to halt a nationwide
tender offer based upon his
examination of materials which meet
applicable federal law.

77. By establishing policies, standards and procedures

that conflict with and are obstacles to the objectives of

Congress expressed in the Exchange Act and rules and regulations

promulgated thereunder, the Take-Over Act is invalid and

unconstitutional as applied to the Tender Offer under the

Supremacy Clause of the United States Constitution, Article VI,

Clause 2, which accords supremacy to federal law over conflicting

state law, and violates and is preempted by Section 28(a) of the

Exchange Act, 15 U.S.C. Sec. 78bb, which prohibits and preempts

state regulation that conflicts with the provisions of the

Exchange Act and the rules and regulations thereunder.

78. Plaintiffs have no adequate remedy at law.

<PAGE>

The Control Share Acquisition Act,
by virtue of
Ohio Rev. Code Sec. 1701.01(CC)(2),
Violates the Supremacy Clause of the
United States Constitution and Section 28
of the Exchange Act
-------------------

(COUNT THREE)

79. Plaintiffs repeat and reallege the averments set

forth in paragraphs 1-78 of this complaint as if fully rewritten

herein.

80. The provisions of the Control Share Acquisition

Act impairing the voting rights of the holders of certain of U.S.

Shoe's shares frustrate the objectives, and are in direct

conflict with, the Exchange Act and the rules and regulations

promulgated thereunder, in at least the following respects:

(a) Effectively imposing proxy
requirements inconsistent with
those imposed by federal law;

(b) Constituting an attempt to
assert the legislative power
of the State of Ohio over a
subject matter over which the
federal government has devel-
oped a comprehensive body of
law; and

(c) Functioning as a bar to
national tender offers by
impeding the ability to
conduct the control share
acquisition meeting so that
shareholders can decide
whether a change of control
should occur, by making it
impossible to identify
"interested shares," and
therefore making it impossible
to determine and obtain the
vote required by Ohio Rev.
Code Sec. 1701.831(E)(1).

81. By establishing policies, standards and procedures

that conflict with and are obstacles to the objectives of

Congress expressed in the Exchange Act and the rules and

28
<PAGE>

regulations promulgated thereunder, Ohio Rev. Code Sec.

1701.831(E)(1), by virtue of Ohio Rev. Code Sec. 1701.01(CC)(2),

is invalid and unconstitutional as applied to the Tender Offer

under the Supremacy Clause of the United States Constitution,

Article VI, Clause 2, which accords supremacy to federal law over

conflicting state law, and violates and is preempted by Section

28(a) of the Exchange Act, 15 U.S.C. Sec. 78bb, which prohibits

and preempts state regulation that conflicts with the provisions

of the Exchange Act and the rules and regulations thereunder.

The Control Share Acquisition Act,
by virtue of
Ohio Rev. Code Sec. 1701.01(CC)(2),
Creates an Unlawful Burden
on Interstate Commerce
----------------------

(COUNT FOUR)

82. Plaintiffs repeat and reallege the averments set

forth in paragraphs 1-81 of this Complaint as if fully rewritten

herein.

83. The Control Share Acquisition Act, by virtue of

Ohio Rev. Code Sec. 1701.01(CC)(2), was intended to discourage

trading in securities of target companies after the announcement

of a tender offer by limiting the voting rights of certain

purchasers. It was intended to disrupt the national secondary

market in securities, a market generally regulated by federal,

not state law. The provision effectively discourages the

purchase of shares of widely held public companies after

announcement of a tender offer.

84. The Control Share Acquisition Act, by virtue of

Ohio Rev. Code Sec. 1701.01(CC)(2), is invalid, unconstitutional,

null and void because it places a substantial burden on

interstate commerce that outweighs any putative local benefits,

in violation of the Commerce Clause, art. I, Sec. 8, cl. 3 of the

United States Constitution.

<PAGE>

85. Plaintiffs have no adequate remedy at law.

The Control Share Acquisition Act,
by virtue of
Ohio Rev. Code Sec. 1701.01(CC)(2),
Violates the Due Process and
Obligations of Contract Clauses of the
United States and Ohio Constitutions
------------------------------------

(COUNT FIVE)

86. Plaintiffs repeat and reallege the averments set

forth in paragraphs 1-85 of this Complaint as if fully rewritten

herein.

87. Article Fourth of U.S. Shoe's Amended Articles of

Incorporation provides that "(a)ll shares of any particular

series shall rank equally and be identical in all respects . . ."

and that "(e)ach outstanding Common Share . . . shall entitle the

holder thereof to one vote on each matter properly submitted to

the shareholders for their vote, consent, waiver, release

or other action, subject to the provisions of law from time to

time in effect with respect to cumulative voting."

88. The express terms of the shares set forth in U.S.

Shoe's Amended Articles of Incorporation, particularly the right

to vote, constitute a contract between U.S. Shoe and its

shareholders and a property right of shareholders.

89. Ohio Rev. Code Sec. 1701.01(CC)(2) impairs the

voting rights of certain shares in violation of Article Fourth

and the contractual and property rights of U.S. Shoe shareholders.

<PAGE>

90. Section 10, Article I of the United States

Constitution, and Section 28, Article II of the Ohio Constitution

prohibit the Ohio General Assembly from passing any "laws

impairing the obligation of contracts."

91. The Control Share Acquisition Act, by virtue of

Ohio Rev. Code Sec. 1701.01(CC)(2), violates Section 10, Article

I of the United States Constitution, Section 28, Article II of

the Ohio Constitution by impairing the obligations of U.S. Shoe's

contract with its shareholders, and the due process clause of the

Fourteenth Amendment to the United States Constitution by

depriving U.S. Shoe's shareholders of property interests without

due process of law.

92. Plaintiffs have no adequate remedy at law.

The Poison Pill Plan Violates
Ohio Rev. Code Chapter 1701
---------------------------

(COUNT SIX)

93. Plaintiffs repeat and reallege the averments set

forth in paragraphs 1-92 of this Complaint as if fully rewritten

herein.

94. The Rights created by the Poison Pill Plan are

rights to receive a dividend in cash, property or securities

pursuant to Ohio Rev. Code Sec. 1701.33.

95. The Poison Pill Plan excludes shares held by a

holder of 20% or more of U.S. Shoe's outstanding Common Shares

from the dividend created, and therefore the Poison Pill Plan

violates Ohio Rev. Code Sec. 1701.33.

96. The Poison Pill Plan grants options to purchase

Common Shares in the event of a flip-in, and is invalid because

U.S. Shoe does not have sufficient authorized but

<PAGE>

unissued Common Shares to satisfy exercise of the Rights, in

violation of Ohio Rev. Code Sec. 1701.16.

97. The amount of dividend U.S. Shoe would be required

to pay under the Poison Pill Plan would create an unlawful

disposition of all of U.S. Shoe's assets in violation of Ohio

Rev. Code Sec. 1701.76 or a voluntary dissolution of U.S. Shoe

without requisite shareholder approval in violation of Ohio Rev.

Code Sec. 1701.86.

98. Plaintiffs have no adequate remedy at law.

Failure by U.S. Shoe's Directors to Redeem
its Poison Pill Violates their Fiduciary Duties
-----------------------------------------------

(COUNT SEVEN)

99. Plaintiffs repeat and reallege the averments set

forth in paragraphs 1-98 of this Complaint as if fully rewritten

herein.

100. Luxottica Acquisition's Tender Offer offers a

substantial premium to U.S. Shoe's stockholders for their stock,

and contains no threat or coercion of any kind to U.S. Shoe or to

U.S. Shoe's stockholders. The Tender Offer treats all U.S. Shoe

shareholders equally and allows them to decide for themselves

whether to accept the benefits of the premium offer.

101. The purported purpose of the Poison Pill Plan is

to protect U.S. Shoe's shareholders. Luxottica Acquisition's all

cash, all shares premium offer does not imperil U.S. Shoe's

shareholders in any way. Thus, the Poison Pill Plan cannot

legitimately be used to block the Tender Offer and, accordingly,

U.S. Shoe's Board of Directors have fiduciary duties under Ohio

law to redeem the Rights to allow the Tender Offer to proceed.

<PAGE>

102. U.S. Shoe's Board of Directors has refused and

likely will continue to refuse to redeem the Poison Pill Plan as

necessary to allow Plaintiffs' premium Tender Offer to proceed to

completion.

103. U.S. Shoe's refusal to redeem the Rights denies

U.S. Shoe's shareholders the right freely to consider the Tender

Offer on its merits and to accept the Tender Offer if they choose

to do so.

104. Plaintiffs have no adequate remedy at law.

Failure by U.S. Shoe's Directors Who Are Not
--------------------------------------------
Officers of U.S. Shoe To Approve
--------------------------------
The Tender Offer Violates Their Fiduciary Duties
------------------------------------------------

(COUNT EIGHT)
-----------

105. Plaintiffs repeat and reallege the averments set

forth in paragraphs 1-104 of this Complaint as if fully rewritten

herein.

106. Under the terms of the Poison Pill Plan, the Plan

does not apply to a tender offer if a majority of the directors

of U.S. Shoe who are not officers of the Corporation determine

that the offer is in the best interest of the Corporation and its

shareholders.

107. Luxottica Acquisition's Tender Offer offers a

substantial premium to U.S. Shoe's shareholders for their stock,

and contains no threat or coercion of any kind to U.S. Shoe or to

U.S. Shoe's shareholders. The Tender Offer treats all U.S. Shoe

shareholders equally and allows them to decide for themselves

whether to accept the benefits of the premium offer. Accordingly,

the Tender Offer is in the best interest of U.S. Shoe and its

shareholders, and U.S. Shoe's Directors who are not officers have

a fiduciary duty to approve the Tender Offer and thereby render

the Poison Pill Plan inapplicable to the Tender Offer.

<PAGE>

108. The members of U.S. Shoe's Board of Directors who

are not officers of the Corporation have failed to determine that

the Tender Offer is in the best interest of the Corporation and

its shareholders.

109. The failure of the members of U.S. Shoe's Board of

Directors who are not officers of the Corporation to

approve the Tender Offer and thus render the Poison Pill Plan

inapplicable denies U.S. Shoe's shareholders the right freely to

consider the Tender Offer on its merits and to accept the Tender

Offer if they choose to do so.

110. Plaintiffs have no adequate remedy at law.

IRREPARABLE INJURY
------------------

111. Unless temporary, preliminary and permanent

injunctive relief is granted, plaintiffs and U.S. Shoe's

shareholders will be irreparably harmed in at least the following

respects:

(a) Luxottica Acquisition faces
the difficulty of proceeding nationwide,
if there is a "summary suspension" in
Ohio, and the inability to consummate
the Tender Offer if the Division denies
permission to proceed with the Tender
Offer because it will be effectively
unable to purchase nationwide;

(b) the confusion, delay, or
litigation resulting from any attempt to
enforce the Take-Over Act will adversely
affect Offeror Plaintiffs' ability to
purchase shares pursuant to the Tender
Offer nationwide, and could be used by
U.S. Shoe's management to frustrate the
Tender Offer and deprive U.S. Shoe
shareholders of the opportunity to
choose whether or not to tender their
shares;

(c) U.S. Shoe shareholders may be
discouraged from accepting the Tender
Offer because of uncertainty surrounding
the Take-Over Act;

<PAGE>

(d) U.S. Shoe's shareholders will
be further subjected to corporate
governance inconsistent with their own
best interests and Luxottica Acquisition
may be unable to comply with the illegal
vote required by the Control Share
Acquisition Act;

(e) U.S. Shoe's shareholders may
be deprived of an opportunity to receive
the benefits of Offeror Plaintiffs' all
cash premium offer; and

(f) Luxottica Acquisition's ability
to consummate the Tender Offer may be
impeded as a result of U.S. Shoe's
failure to redeem the Rights or the
failure of the members of U.S. Shoe's
Board of Directors who are not officers
to approve the Tender Offer and thereby
render the Poison Pill Plan
inapplicable.

112. Unless temporary, preliminary and permanent

injunctive relief is granted, shareholders of U.S. Shoe who

reside throughout the United States, including those residing in

the State of Ohio, may be deprived of their right freely to

consider and avail themselves of the Tender Offer and to sell

their shares to Luxottica Acquisition at the substantial premium

over market prices offered pursuant to the Tender Offer.

WHEREFORE, plaintiffs pray that this Court:

(i) declare and adjudge that the Take-Over Act is

unconstitutional as applied to the Tender Offer;

(ii) temporarily, preliminary and permanently enjoin

defendants, their respective assigns and successors, their

directors, officers, agents, employees, attorneys, servants and

shareholders and all persons in active concert or participation

with them, from taking any actions to enforce or apply the Take-

Over Act to the Tender Offer;

<PAGE>

(iii) declare and adjudge that Ohio Rev. Code Sec.

1701.831(E)(1), by virtue of Ohio Rev. Code Sec. 1701.01(CC)(2),

is unconstitutional as applied to the Tender Offer;

(iv) preliminarily and permanently enjoin defendants

from classifying or treating any U.S. Shoe shares as "interested

shares" pursuant to Ohio Rev. Code Sec. 1701.01(CC)(2) for pur-

poses of conducting the vote on the proposed control share acqui-

sition under Ohio Rev. Code Sec. 1701.831(E)(1);

(v) declare and adjudge that the U.S. Shoe's Poison

Pill is illegal, null and void;

(vi) declare and adjudge that U.S. Shoe's Board of

Directors is in breach of their fiduciary duties under Ohio law

for refusing to redeem the Rights;

(vii) declare and adjudge that the members of U.S. Shoe's

Board of Directors who are not officers of the Corporation are

in breach of their fiduciary duties under Ohio law for failing

to approve the Tender Offer and thereby rendering the Poison

Pill Plan inapplicable;

(viii) preliminarily and permanently enjoin U.S. Shoe

and its Board of Directors from taking any steps to enforce or

amend the Poison Pill (except to redeem the Rights);

(ix) preliminarily and permanently order U.S. Shoe and

its Board of Directors to redeem the Rights;

(x) preliminary and permanently order the members of U.S.

Shoe's Board of Directors who are not officers of the Corporation

to approve the Tender Offer and thereby render the Poison Pill

Plan inapplicable;

(xi) award plaintiffs their costs and disbursements in

this action, including reasonable attorney's fees; and

<PAGE>

(xii) grant such other and further relief as the Court

may deem just and proper.

________________________________
Thomas B. Ridgley (0000910)
Trial Attorney
VORYS, SATER, SEYMOUR AND PEASE
52 East Gay Street
P.O. Box 1008
Columbus, Ohio 43216-1008
(614) 464-6229

Attorneys for Plaintiffs

OF COUNSEL:

WINSTON & STRAWN
Anthony J. D'Auria
175 Water Street
New York, New York 10038
(212) 269-2500

VORYS, SATER, SEYMOUR AND PEASE
Laura G. Kuykendall (0012591)
52 East Gay Street
P.O. Box 1008
Columbus, Ohio 43216-1008
(614) 464-6400