We present optical observations of a ULX in the nearby spiral galaxy IC 342 .
This variable source has an average X-ray luminosity of some 10 ^ { 40 } erg/s .
At the position of the source there is an ionized nebula ( the ” Tooth ” ) having huge dimensions ( 280 x 130 pc ) , much larger than normal supernova remnants .
Our optical spectra reveal highly supersonic expansion velocities and emission line ratios typical of SNRs .
It has been claimed that two [ OIII ] \lambda 5007 bright regions in the nebula might be indicative of excitation by non-isotropic emission from the ULX .
However , our continuum subtracted [ OIII ] \lambda 5007 image reveals that O ^ { + + } ions are rather smoothly distributed in the nebula , fully consistent with shock excitation .
Within the nebula we find two candidate stars ( V = 24.0 & 24.6 ) in the Chandra X-ray error circle .
Both are substantially reddened being consistent with the patchy interstellar absorption .
We will discuss the nature of this source in the framework of what is currently known about optical counterparts of ULXs .