                       United States Court of Appeals
                          FOR THE EIGHTH CIRCUIT

      __________________

      Nos. 96-3058/96-3143
      __________________

ARE Sikeston Limited Partnership, a     *
Pennsylvania limited partnership;       *
American Real Estate Investment         *
Corporation, as general and limited     *
partner; American Hotel Management,     *
Inc.,                                   *
                                        *
             Appellants,                *
                                        *   Appeals and Cross-Appeal from the
      v.                                *   United States District Court for the
                                        *   Eastern District of Missouri.
Weslock National, Inc.; Nalcor, doing *
business as American Builders           *
Hardware Corp., Inc.,                   *
                                        *
             Appellees.                 *
                                        *
Weslock National,                       *
                                        *
      Third Party Plaintiff - Appellee, *
                                        *
      v.                                *
                                        *
Westinghouse Electric Corporation,      *
                                        *
      Third Party Defendant - Appellee. *
      __________

      No. 96-3104
      __________

ARE Sikeston Limited Partnership, a      *
Pennsylvania limited partnership;        *
American Real Estate Investment          *
Corporation, as general and limited      *
partner; American Hotel Management,      *
Inc.,                                    *
             Plaintiffs,                 *
                                         *
      v.                                 *
                                         *
Weslock National, Inc.; Nalcor, doing *
business as American Builders            *
Hardware Corp., Inc.,                    *
                                         *
             Defendants,                 *
                                         *
      v.                                 *
                                         *
Weslock National, Inc.,                  *
                                         *
      Third Party Plaintiff - Appellant, *
                                         *
      v.                                 *
                                         *
Westinghouse Electric Corporation,       *
                                         *
      Third Party Defendant - Appellee. *
                                    ___________

                           Submitted: May 22, 1997
                              Filed: July 22, 1997
                                ___________

                                       -2-
Before MURPHY, HEANEY, and MAGILL, Circuit Judges.
                           ___________

MAGILL, Circuit Judge.

    ARE Sikeston Limited Partnership and its general and
limited partners (collectively, ARE Sikeston) brought
this action against Weslock National, Inc. (Weslock
National) and Nalcor, Inc. (Nalcor). In its action, ARE
Sikeston alleges that Weslock National and Nalcor are
liable for the rent payments remaining on a 15-year lease
that Nalcor entered into with ARE Sikeston.       Weslock
National   filed   a    third-party   complaint   against
Westinghouse Electric Corporation (Westinghouse), seeking
indemnification or contribution in the event that Weslock
National is held liable to ARE Sikeston.          Weslock
National and Westinghouse moved for summary judgment.
ARE Sikeston moved for leave to file an amended complaint
to add Westinghouse as a defendant. The district court1
granted Weslock National’s and Westinghouse’s motions for
summary judgment and denied ARE Sikeston’s motion for
leave to amend its complaint.         ARE Sikeston Ltd.
Partnership v. Weslock National, Inc., 932 F. Supp. 240,
243 (E.D. Mo. 1996).     In addition, the district court
subsequently entered a judgment against Nalcor.       ARE
Sikeston appeals, and Weslock National brings a
protective cross appeal. We affirm.

                                     I.



      1
       The Honorable Stephen N. Limbaugh, United States District Judge for the
Eastern District of Missouri.

                                     -3-
    Nalcor, a manufacturer of residential door knobs and
locksets, owned 30 acres of commercial real estate in
Sikeston, Missouri (the Sikeston Property). The Sikeston
Property included a 106,500-square-foot building that
housed Nalcor’s lock manufacturing operations.        On
December 27, 1988, ARE Sikeston purchased the




                           -4-
Sikeston Property from Nalcor, and as a part of the same
transaction, ARE Sikeston leased backed the property to
Nalcor pursuant to a written lease.

    The term of the lease was for fifteen years at a
rental rate of $299,250 per year, to be adjusted annually
for inflation.    See Lease by and between ARE Sikeston
Limited Partnership and Nalcor, Inc. (Dec. 27, 1988)
(Lease) at §§ 1.02, 2.01, reprinted in I J.A. at 20-22.
The lease also provided that “[a]ll assignments and
subleases shall be subject to the prior written approval
of Landlord [ARE Sikeston], which approval shall not be
reasonably withheld or delayed.”     Lease at § 9.01(a),
reprinted in I J.A. at 33.

    In December 1989, Nalcor acquired another lock
manufacturing    company   and   two    plumbing   parts
manufacturers. As a result of the acquisition, Nalcor
acquired additional manufacturing facilities in Mexico
and California.2    At its Sikeston Property facility,
Nalcor continued its lock manufacturing operations.
    In order to finance the December 1989 acquisitions,
Nalcor obtained a $36 million credit facility from
Westinghouse.   To secure this loan, Westinghouse took
three major steps. First, Westinghouse took a first lien
and security interest in virtually all of Nalcor’s
assets, including those assets of Nalcor located at the
Sikeston Property.     In the event of a default, the



      2
        Also as part of the same transaction, Nalcor changed its name to American
Builders Hardware Corporation. Notwithstanding this change of name, we will refer
to this entity as Nalcor throughout this opinion.

                                       -5-
financing and security agreement between Westinghouse3 and
Nalcor gave Westinghouse both the right to demand full
payment and the right to take possession of Nalcor’s
assets, including those located at the Sikeston Property,
if the demand for payment were not satisfied.          See
Financing & Security Agreement (Dec.




      3
         This agreement was formed between Nalcor and Westinghouse Credit
Corporation, the predecessor in interest to Westinghouse Electric Corporation. We will
refer to both Westinghouse Credit Corporation and Westinghouse Electric Corporation
as Westinghouse.

                                         -6-
29, 1989) at § 14.1(C),(F), reprinted in I J.A. at 413-
14.    In addition, upon default, the financing and
security agreement granted Westinghouse the right to
collect Nalcor’s accounts receivable and to sell its
assets.   Id. at § 14.1(G),(H), reprinted in I J.A. at
414-15.    As defined by the financing and security
agreement, an event of default included the insolvency of
Nalcor.   See id. at § 13(E), reprinted in I J.A. at 411.

    Westinghouse also took a security interest in
Nalcor’s lease and leasehold interest in the Sikeston
Property. Westinghouse’s security interest in Nalcor’s
leasehold of the Sikeston Property was set forth in a
leasehold deed of trust executed by Nalcor and
Westinghouse.     Under the leasehold deed of trust,
Westinghouse had the right to enter the Sikeston Property
and to hold, use, and conduct business on the property in
the event of a default by Nalcor.      Specifically, the
leasehold deed of trust provided:

    Upon the occurrence of one or more Events of
    Default . . . [Westinghouse] personally, or by
    its employees, agents or attorneys, may enter
    into and upon all or any part of the [Sikeston
    Property], and exclude [Nalcor], its agents and
    servants wholly therefrom; and having and
    holding the same, use, operate, manage and
    control the [Sikeston Property] and conduct the
    business thereof . . . . [Westinghouse] shall
    have the right to manage and operate the
    [Sikeston Property] and to carry on the business
    thereof . . . .

Leasehold Deed of Trust (Feb. 13, 1990) at § 8, reprinted
in I J.A. at 124. In addition, pursuant to § 8(c)(i) of


                           -7-
the leasehold deed of trust, Westinghouse had the right
to foreclose on Nalcor’s leasehold of the Sikeston
Property in the event of a default.      See id. at §
8(c)(i), reprinted in I J.A. at 124.

    Finally,   Westinghouse  also  required   that  ARE
Sikeston, as landlord, agree to waive certain of its
rights with respect to Nalcor’s assets and the Sikeston
Property. Accordingly, Westinghouse, ARE Sikeston, and
Nalcor entered into a Landlord’s




                          -8-
Consent and Waiver of Lien Rights.     Pursuant to this
agreement, ARE Sikeston consented

    to the transfer, assignment, pledge, mortgage or
    encumbrance    by   [Nalcor]    in    favor   of
    [Westinghouse] of [Nalcor]’s right, title and
    interest in and to [Nalcor]’s personal property
    and fixtures located at the [Sikeston Property]
    and to the grant by [Nalcor] of a Leasehold
    Mortgage of the [Sikeston Property] in favor of
    [Westinghouse].

Landlord’s Consent & Waiver of Lien Rights (Dec. 29,
1989) at § 1, reprinted in Appellee’s Add. Moreover, as
a part of the same agreement, ARE Sikeston gave up any
rights it may have had to a first security interest in
Nalcor’s assets and retained only a subordinated security
interest. See id. at § 2, reprinted in Appellee’s Add.

    ARE Sikeston further agreed not to “modify, amend,
terminate (except upon expiration of the Term of the
Lease), accept a surrender or abandonment of, or
otherwise agree to change the terms of the Lease, without
the consent of [Westinghouse], which shall not be
unreasonably withheld.”     Id. at § 3, reprinted in
Appellee’s Add. In the event of the termination of the
original lease as a result of Nalcor’s default, ARE
Sikeston agreed “to enter into a new lease (‘New Lease’)
of the Premises at the option of [Westinghouse] for the
remainder of the term of the Lease . . . at the rent and
additional rent, and upon the terms, covenants and
conditions . . . of the [original] Lease . . . .” Id. at
§ 5, reprinted in Appellee’s Add. Finally, the parties
agreed that “[i]f any one or more provisions of the Lease


                           -9-
conflict with any provision [of the Landlord’s Consent
and Waiver of Lien Rights], such provisions of the Lease
shall be wholly subordinate to and superseded by the
applicable provision [of the Landlord’s Consent and
Waiver of Lien Rights].”     Id. at § 7, reprinted in
Appellee’s Add.




                          -10-
    In each of the years following the December 1989
acquisitions, Nalcor lost money and as a result gradually
slipped into insolvency.    By April 1993, Westinghouse
estimated that it was undersecured in its loans to Nalcor
by more than $10 million.       Around this same time,
Westinghouse began to explore the possibility of having
another company acquire Nalcor.      On April 20, 1993,
Westinghouse declared Nalcor to be in default and made
demand on Nalcor for full payment of Nalcor’s obligations
to Westinghouse. On June 1, 1993, when it became clear
that Nalcor could not pay in full, Westinghouse demanded
that Nalcor turn over its assets.

    Nalcor complied with Westinghouse’s demand and, in
early June 1993, turned over its assets in place to
Westinghouse, including the assets at the Sikeston
Property. Westinghouse took possession of the Sikeston
Property and began operating Nalcor’s business while
simultaneously marketing Nalcor’s assets for sale.
However, Westinghouse never foreclosed on Nalcor’s
leasehold.   Furthermore, ARE Sikeston never requested
Westinghouse’s permission to exercise any rights against
Nalcor’s assets nor did ARE Sikeston ever request a
termination or modification of the lease.

     In the first week of June 1993, Westinghouse informed
ARE Sikeston that Westinghouse had taken possession of
Nalcor’s assets at the Sikeston Property and that
Westinghouse intended to run the business while it looked
for a purchaser that would buy Nalcor as a going concern.
According to Dale Kuhlman, ARE Sikeston’s property
manager, Westinghouse also discussed with ARE Sikeston
that    “it  was   in   everyone’s   interest   to   allow

                           -11-
[Westinghouse] to continue to pay the rent, to market the
property, because at the end we would each get what we
wanted[;] . . . [Westinghouse] would get some payment for
their assets and [ARE Sikeston] would get a tenant.”
Dale D. Kuhlman Dep. at 100, reprinted in III J.A. at
1257. In a subsequent letter dated June 15, 1993, from
Westinghouse’s   counsel,   Westinghouse   informed   ARE
Sikeston that “Westinghouse has made, and likely will in
the future make, certain rent payments necessary to avoid
a default by [Nalcor] under the Lease.” Letter of James
P. Drummy (June 15, 1993) at 1, reprinted in III J.A. at
1424. In that same letter, however,




                           -12-
Westinghouse stated that “in making such payments,
Westinghouse is not assuming the Lease or any of tenants’
obligations thereunder.” Id.

    During the period that Westinghouse occupied the
Sikeston Property, it paid the full rent as provided by
the Nalcor lease.     In addition, when the insurance
coverage previously maintained by Nalcor expired in July
1993, Westinghouse obtained new coverage effective July
24, 1993.

    On June 17, 1993, Westinghouse gave notice to Nalcor
that it would sell all or part of the secured assets of
Nalcor at one or more private foreclosure sales on or
after June 28, 1993. In July 1993, Westinghouse began
negotiating with Weslock National for the sale of
Nalcor’s   lock   manufacturing   operations.      These
negotiations culminated in a private foreclosure sale of
Nalcor’s lock manufacturing operations to Weslock
National on August 4, 1993. Weslock National, however,
did not purchase Nalcor’s plumbing parts manufacturing
operations.

    A letter agreement and two bills of sale memorialized
the August 4, 1993 transaction. In addition to excluding
certain assets of Nalcor, such as any of Nalcor’s
remaining cash, both bills of sale specifically excluded
from the sale “any of [Nalcor]’s rights as tenant in or
with respect to leases or subleases of real property . .
. .”   Bill of Sale & Assignment (Aug. 4, 1993) at 1,
reprinted in Appellee’s Add. In addition, the parties
also agreed in both bills of sale that:



                           -13-
    [Westinghouse]    acknowledges   that   [Weslock
    National], in purchasing the Personal Property,
    is not assuming any indebtedness, liabilities or
    obligations of [Nalcor], [Westinghouse] or any
    other person or entity . . . .

Id. at 2.




                          -14-
    Finally, the August 4, 1993 letter agreement between
Westinghouse   and   Weslock   National   contained   an
integration clause that provided that:

    This Agreement and the Bills of Sale constitute
    the entire agreement between [Weslock National]
    and [Westinghouse] with regard to the Assets and
    any other matter.      No other agreements or
    understandings exist between [Weslock National]
    and [Westinghouse] and, to the extent such other
    agreements or understandings may have existed
    prior to the execution of this Agreement, such
    understandings and agreements do not survive the
    execution hereof.

Letter Agreement (Aug. 4, 1993), reprinted in Appellee’s
Add.

    Weslock National took control of the Sikeston
Property on or about August 5, 1993. Weslock National
retained some of the employees from Nalcor’s Sikeston
Property operations and some of Nalcor’s mid-level
managers in order to continue the plant’s lock
manufacturing operations. Nalcor itself was eventually
dissolved sometime in 1994.

    It was not until August 24, 1993, that ARE Sikeston
learned that Weslock National was occupying the Sikeston
Property.    In an August 26, 1993 letter to Weslock
National, ARE Sikeston wrote that, “[i]nsofar as Nalcor,
Inc. is obligated under a lease on [the Sikeston
Property], and we [ARE Sikeston] have not been asked nor
consented to an assignment of this lease, it is uncertain
on   what basis [Weslock National] occup[ies] the
property.”   Letter of John F. Horrigan, III (Aug. 26,

                           -15-
1993) at 1, reprinted in I J.A. at 340. ARE Sikeston
also advised Weslock National that “as occupant[, Weslock
National is] under various obligations with respect to
this property, including those to pay rent, properly
maintain the facility and grounds, maintain operating
permits, pay utilities, and insure the property among
others.” Id.




                           -16-
    Weslock National responded in a letter that it had
purchased the lock manufacturing assets of Nalcor, but
that “Weslock did not assume any of the obligations of
[Nalcor], including any lease agreements for real
property in Sikeston, Missouri.”    Letter of Donald B.
Horan (Jan. 3, 1994) at 1, reprinted in I J.A. at 343.
In addition, after noting that it had undertaken the
ordinary obligations of a tenant, Weslock National
requested ARE Sikeston to prepare a new lease because
“both parties would be better served if the property was
[sic] occupied under a lease.” Id.

    In response to Weslock National’s letter, ARE
Sikeston changed its position. ARE Sikeston abandoned
its initial contention that “it [was] uncertain on what
basis [Weslock National] occup[ied] the property” as well
as its contention that Weslock National was obligated “as
occupant.” Letter of Horrigan at 1, reprinted in I J.A.
at 340.    Instead, on January 13, 1994, ARE Sikeston
informed Weslock National that ARE Sikeston “believe[d]
Weslock National is obligated under the terms of the
[Nalcor] lease . . . .” Letter of John F. Horrigan, III
(Jan. 13, 1994) at 1, reprinted in I J.A. at 345. For
its part, however, Weslock National maintained that it
“occup[ied] the facility on a month to month basis . . .
.”    Letter of Joe Bockrath (Sept. 6, 1994) at 1,
reprinted in I J.A. at 351.      Discussions between the
parties were held, but no agreement was reached.

    On September 6, 1994, Weslock National gave written
notice to ARE Sikeston that Weslock National had decided
to leave the Sikeston Property and relocate operations to
another facility. On December 31, 1994, Weslock National

                           -17-
vacated the premises. During the entire period that it
was in possession of the Sikeston Property, Weslock
National paid rent to ARE Sikeston for the use of the
Sikeston Property.    For the nearly five-month period
between August 5, 1993, and December 31, 1993, Weslock
National paid the full amount of the rent called for in
the Nalcor lease. During 1994, however, Weslock National
continued to pay at the 1993 rate rather than pay rent at
the increased rate called for by the inflation-adjustment
provision contained in the




                           -18-
Nalcor lease. Weslock National also paid the insurance
premiums, property taxes, real estate taxes, utilities,
upkeep and maintenance costs, and operating fees for the
plant.

    On November 30, 1994, ARE Sikeston filed a breach of
contract claim against Weslock National in Missouri state
court.    In its complaint, ARE Sikeston claimed that
Weslock National was obligated under the terms of the
Nalcor lease and that Weslock National had failed to
satisfy the terms of that lease. On December 21, 1994,
Weslock National removed the case to the district court
pursuant to 28 U.S.C. § 1441 (1994).      Federal subject
matter jurisdiction was established because ARE Sikeston
is a Pennsylvania partnership with business offices in
Pennsylvania, and Weslock National is an Oklahoma
corporation with facilities in Missouri and California.
Both parties agree that Missouri substantive law governs
this dispute.

    The district court initially set trial for December
4, 1995.    On September 20, 1995, ARE Sikeston sought
leave to amend its complaint to add Nalcor as a defendant
and assert four new claims against Weslock National. On
October 19, 1995, the district court granted ARE
Sikeston’s request, and on October 30, 1995, ARE Sikeston
filed its first amended complaint. In that complaint,
ARE Sikeston added Nalcor as a defendant and brought
claims against Weslock National for breach of contract,
breach of estate covenants, malicious interference with
contract, fraud, fraudulent conveyance, and unjust




                           -19-
enrichment.4 ARE Sikeston sought as damages all rents,
taxes, utilities, and maintenance costs for the Sikeston
Property through the expiration of the Nalcor lease in
December 2003. In the alternative, ARE Sikeston sought
$2.5 million in damages under a buy-back provision of the
lease.

    On November 6, 1995, Weslock National filed its
answer to ARE Sikeston’s first amended complaint and
filed a third-party complaint, pursuant to Federal Rule
of Civil Procedure 14, against Westinghouse, which is a
Pennsylvania corporation with




    4
     ARE Sikeston has not raised its unjust enrichment claim on appeal.

                                     -20-
its principal place of business in Pennsylvania. In its
third-party complaint, Weslock National sought indemnity
or contribution in the event that Weslock National was
held liable to ARE Sikeston.        The district court
postponed the trial and rescheduled it for March 25,
1996.

    On March 11, 1996, Weslock National moved for summary
judgment.    A few days later, on March 14, 1996, the
district court moved the trial date to July 1, 1996. On
April 11, 1996, ARE Sikeston moved for leave to file a
second amended complaint to assert state law real
property and breach of contract claims directly against
Westinghouse or, in the alternative, for a remand to
Missouri state court. ARE Sikeston pleaded 28 U.S.C. §
1367 (1994) as the basis for the district court’s
jurisdiction over these claims.        On May 8, 1996,
Westinghouse filed its own motion for summary judgment on
Weslock National’s indemnification claim. On June 21,
1996, the district court denied ARE Sikeston’s motion to
file a second amended complaint and granted summary
judgment to Weslock National. ARE Sikeston, 932 F. Supp.
at 243.    Because the district court granted summary
judgment to Weslock National, it also granted summary
judgment to Westinghouse: the liability of Westinghouse
on Weslock National’s indemnification claim was entirely
dependent on Weslock National’s liability to ARE
Sikeston.    Id.  On July 9, 1996, the district court
entered default judgment against Nalcor in the amount of
$2,450,000.5


      5
        After Westinghouse foreclosed on nearly all of Nalcor’s assets, Nalcor was
dissolved in 1994. We recognize, therefore, that it is highly unlikely that ARE Sikeston

                                         -21-
    On July 17, 1996, ARE Sikeston filed a motion to
alter or amend the judgment by reconsideration of summary
judgment pursuant to Federal Rule of Civil Procedure 59.
The motion was denied. ARE Sikeston now appeals to this
Court, and Weslock National brings a protective cross
appeal.




will ever be able to collect on this judgment.

                                         -22-
                          II.

    On appeal, we review de novo the district court’s
grant of summary judgment to Weslock National and
Westinghouse. See McCormack v. Citibank, N.A., 100 F.3d
532, 537 (8th Cir. 1996).     Summary judgment is proper
only if the record, viewed in the light most favorable to
the nonmoving party, presents no genuine issues of
material fact and the moving party is entitled to
judgment as a matter of law. Id.; see also Fed. R. Civ.
P. 56(c). Furthermore, if there has been adequate time
for discovery, Federal Rule of Civil Procedure 56(c)
mandates that the district court grant a motion for
summary judgment “against a party who fails to make a
showing sufficient to establish the existence of an
element essential to that party’s case, and on which that
party will bear the burden of proof at trial.” Celotex
Corp. v. Catrett, 477 U.S. 317, 322 (1986). Finally, we
may affirm the district court’s grant of summary judgment
to Weslock National and Westinghouse “on any grounds
supported by the record.” Ricke v. Armco Inc., 92 F.3d
720, 721 (8th Cir. 1996) (quotations and citation
omitted).

    ARE Sikeston argues that the district court erred in
granting summary judgment on ARE Sikeston’s breach of
contract claim.     According to ARE Sikeston, Weslock
National assumed the obligations of the Nalcor lease on
August 4, 1993, through the purchase of substantially all
the assets of Nalcor. Thus, ARE Sikeston argues that,
because Weslock National assumed the Nalcor lease,
Weslock National is now liable for the remaining years of
that lease. We disagree.

                           -23-
    In general, “courts in Missouri have not seen fit to
depart from the traditional distinction between corporate
mergers or the sale and purchase of outstanding stock of
a corporation, whereby preexisting corporate liabilities
also pass to the surviving corporation or to the
purchaser, and the sale and purchase of corporate assets
which eliminates successor liability.” Chemical Design,
Inc. v. American Standard, Inc., 847 S.W.2d 488, 492-93
(Mo. Ct. App. 1993); see also Ernst v. Ford Motor Co.,
813 S.W.2d 910, 916-17 (Mo. Ct. App. 1991). Accordingly,
“[t]he general rule in Missouri




                           -24-
is that when all of the assets of a corporation are sold
or transferred the transferee is not liable for the
transferor’s debts and liabilities.”     Chemical Design,
847 S.W.2d at 491.
    There are, however, four exceptions to the general
rule of nonliability. The purchasing corporation can be
liable   for   the   selling  corporation’s    debts  and
liabilities: (1) where the purchaser expressly or
impliedly agrees to assume the debts or liabilities of
the transferor; (2) where the transaction amounts to a
merger or consolidation; (3) where the purchasing
corporation is merely a continuation of the selling
corporation; or (4) where the transaction is entered into
fraudulently for the purpose of escaping liability for
the debts and liabilities of the transferor. Id.; Ernst,
813 S.W.2d at 917.

    In the present action, it is undisputed that Weslock
National purchased Nalcor’s assets, not its stock, from
Westinghouse.     In form at least, Weslock National
therefore did not merge or consolidate with either Nalcor
or Westinghouse.    Thus, unless ARE Sikeston can prove
that Weslock National’s purchase of Nalcor’s assets fits
within one of the four exceptions to the general rule of
nonliability, we must hold that Weslock National did not
assume the liabilities of the Nalcor lease. We address
each exception in turn.
    First, Weslock National did not expressly or
impliedly agree to assume the debts or liabilities of
either Westinghouse or Nalcor. Instead, Weslock National
and Westinghouse clearly expressed in writing their
intention that (1) no rights under the lease were being
assigned to Weslock National and (2) Weslock National was

                           -25-
not promising to perform any of the obligations under the
Nalcor lease.     The two bills of sale specifically
excluded from the sale “any of [Nalcor]’s rights as
tenant in or with respect to leases or subleases of real
property . . . .” Bill of Sale & Assignment (Aug. 4,
1993) at 1, reprinted in Appellee’s Add.      The parties
also agreed that “[Weslock National], in purchasing the
Personal Property [of Nalcor], is not assuming any
indebtedness, liabilities or obligations of [Nalcor],
[Westinghouse] or any other person or entity . . . .”
Id. at 2, reprinted in Appellee’s Add.       Finally, the
August 4, 1993 letter




                           -26-
agreement between Westinghouse     and   Weslock   National
contained an integration clause.

    The written agreements thus make clear that Weslock
National did not accept the obligations under the Nalcor
lease. Accordingly, in light of these express provisions
that directly contradict any notion that Weslock National
expressly or impliedly agreed to assume the Nalcor lease,
we conclude that Weslock National did not expressly or
impliedly agree to assume the Nalcor lease.           See
Carondelet Health Sys., Inc. v. Royal Garden Assocs., 943
S.W.2d 669, 673 (Mo. Ct. App. 1997) (“The cardinal rule
in the interpretation of a contract is to ascertain the
intention of the parties and to give effect to that
intention. Where the contract is unambiguous, intent is
ascertained from the contract alone.” (quotations and
citation omitted)).

    Second, the August 4, 1993 transaction did not amount
to a merger or consolidation, but was instead a
transaction in which Weslock National purchased the
assets of Nalcor’s lock manufacturing operations from
Westinghouse. Under Missouri law, the elements of a de
facto merger include: “(1) a continuation of management
and personnel and general business operations; (2) a
continuity of shareholders resulting from the purchasing
corporation paying for the assets with shares of its own
stock so the selling corporation stockholders become a
constituent part of the purchasing corporation; (3) the
seller corporation ceasing ordinary business operations
and dissolving as soon as possible; and (4) the
purchasing   corporation   assuming   those   obligations
necessary   to   continue   normal,   ordinary   business

                           -27-
operations.” Harashe v. Flintkote Co., 848 S.W.2d 506,
509 (Mo. Ct. App. 1993).

    Although Weslock National continued Nalcor’s lock
manufacturing operations, Weslock National did not
continue any of Nalcor’s other operations, such as its
plumbing manufacturing operations. In addition, although
Weslock National retained some of Nalcor’s employees and
a few mid-level managers, the record indicates that
Weslock National, as a separate corporation, was run by
a different set of directors and




                          -28-
officers. Moreover, Weslock National paid for Nalcor’s
assets with cash, and as a result, there was no
continuity of shareholders.      Finally, there is some
evidence that Nalcor did not cease its ordinary business
operations immediately following the August 4, 1993
transaction, but instead may have continued its plumbing
parts manufacturing operations for a time after Weslock
National’s purchase of Nalcor’s assets. Nalcor was not
dissolved until sometime in 1994. For these reasons, we
conclude that the August 4, 1993 transaction was not a de
facto merger or consolidation.
    Turning to the third exception, Weslock National is
not a mere continuation of Nalcor.     Although there is
evidence that Weslock National retained some of the
former employees of Nalcor, the evidence in the record
does not demonstrate that the corporate organization, the
management, and the operations of the entity that was
formerly Nalcor remained unchanged.         Instead, the
evidence indicates that Weslock National, a separate
entity with its own organization, directors, and
shareholders, took over only the lock manufacturing
operations of Nalcor.     Accordingly, we hold that the
August 4, 1993 transaction does not fit within the third
exception to the general rule that a purchaser of assets
is not liable for the seller’s liabilities. See Chemical
Design, 847 S.W.2d at 493 (“Missouri continues to adhere
to the concept that the phrase ‘continuation of the
corporation’ should be literally applied to the
continuation of the corporate organization, management,
and operations, rather than merely the continuation of
the enterprise or the product line.” (emphasis added));
cf. Brockmann v. O’Neill, 565 S.W.2d 796, 798 (Mo. Ct.
App. 1978) (finding mere continuation where (1) both

                           -29-
transferor and transferee were in same business; (2) the
directors, primary officers, and major shareholders of
the transferor when it ceased to do business were two of
the incorporators, directors, primary officers, and major
shareholders of the transferee; and (3) the business
operations of both transferor and transferee were exactly
the same); see also Flotte v. United Claims, Inc., 657
S.W.2d 387, 389 (Mo. Ct. App. 1983) (noting the Brockmann
court’s “emphasis was on the common identity of officers,
directors and stockholders between the purchasing and
selling   corporations   as   the   key   element  of   a
‘continuation’”).




                           -30-
    Finally, Westinghouse and Weslock National did not,
as ARE Sikeston argues, commit fraud when they entered
into the August 4, 1993 transaction. To bring a cause of
action for fraud, a plaintiff must prove: (1) a
representation; (2) the falsity of that representation;
(3) the materiality of that representation; (4) the
speaker’s knowledge of its falsity or the speaker’s
ignorance of the truth; (5) the speaker’s intent that his
representation be acted upon by the hearer in the manner
reasonably contemplated; (6) the hearer’s ignorance of
the falsity of the representation; (7) the hearer’s
reliance on the representation; (8) the hearer’s right to
rely thereon; and (9) the hearer’s consequent and
proximately caused injury. Slone v. Purina Mills, Inc.,
927 S.W.2d 358, 371 (Mo. Ct. App. 1996); see also State
ex. rel. Painewebber, Inc. v. Voorhees, 891 S.W.2d 126,
128 (Mo. 1995) (en banc).

    Even if we assume that the first eight elements of an
action for fraud have been met and that Weslock National
can be held accountable for those elements, ARE Sikeston
has not made a showing sufficient to establish that the
allegedly fraudulent inducements of Weslock National and
Westinghouse proximately caused injury to ARE Sikeston.
Under Missouri law, in order for a false representation
to be actionable, “[i]t must appear in an appreciable
sense that the damage flowed from the fraud as the
proximate and not the remote cause, and the damage must
be such as is the natural and probable consequence of the
fraud.” Herberer v. Shell Oil Co., 744 S.W.2d 441, 443-
44 (Mo. 1988) (en banc) (quotations and citation
omitted); see also Thoroughbred Ford, Inc. v. Ford Motor
Co., 908 S.W.2d 719, 735 (Mo. Ct. App. 1995). Moreover,

                           -31-
a plaintiff cannot recover for lost rental income if it
is uncertain or speculative whether the loss was the
result of the alleged wrong and whether any such rental
income would have been derived at all. See Thoroughbred
Ford, 908 S.W.2d at 735.
    The proximate cause of ARE Sikeston’s loss of rental
income was the insolvency of Nalcor. Because of Nalcor’s
insolvency, Nalcor could not meet its obligations under
the lease.       Moreover, because ARE Sikeston had
subordinated its security interests in




                          -32-
Nalcor’s assets to Westinghouse’s security interest, ARE
Sikeston was unable to collect by seizing Nalcor’s
assets.

    Nonetheless, ARE Sikeston argues that Westinghouse
and   Weslock   National    caused   injury   by   falsely
representing that the purchaser of Nalcor’s assets would
assume the Nalcor lease and by concealing the sale of
Nalcor’s assets to avoid the liabilities under that
lease.    According to ARE Sikeston, as a result of
Westinghouse’s   and    Weslock    National’s   fraudulent
representations, ARE Sikeston did not exercise its rights
under the lease and thereby lost the opportunity to bind
Weslock National or some other party to the Nalcor lease.
ARE Sikeston thus argues that it is entitled to the
benefit of the bargain that Westinghouse and Weslock
National allegedly promised--a new tenant willing to
assume the Nalcor lease.

    Given that ARE Sikeston had expressly subordinated
its security interest in Nalcor’s assets to Westinghouse
and that Westinghouse was undersecured, the sole recourse
remaining to ARE Sikeston was its right to terminate the
lease and take possession of the Sikeston Property.6
Therefore, ARE Sikeston essentially argues that, because
it was fraudulently induced into not terminating the
lease, it lost an opportunity to bind Westinghouse,
Weslock National, or some other party to the terms of the
Nalcor lease and that, as a direct result of this missed


      6
        We note that even this right was subject to Westinghouse’s approval, which was
never sought. See Landlord’s Consent & Waiver of Lien Rights (Dec. 29, 1989) at §
3, reprinted in Appellee’s Add.

                                        -33-
opportunity,   ARE   Sikeston     suffered   a   loss   of   rental
income.

    It is at best highly speculative whether ARE Sikeston
could have bound another party to the terms of the Nalcor
lease by exercising its termination right. There is no
indication that either Westinghouse or Weslock National
would have assumed the




                                -34-
Nalcor lease. Instead, the record demonstrates that both
Westinghouse and Weslock National were adamantly opposed
to assuming the Nalcor lease.

    In addition, ARE Sikeston has offered no evidence
that, had the lease been terminated sooner, a third party
would have been willing to assume the lease. Indeed, the
unwillingness of either Westinghouse or Weslock National
to assume the Nalcor lease combined with the intense
desire of ARE Sikeston to have a party assume that lease
supports the inference that ARE Sikeston was earning an
above market rate of return on the Sikeston Property
under the Nalcor lease. As a result, under then current
market conditions, it is unlikely that ARE Sikeston could
have found a tenant willing to assume the Nalcor lease.



    Furthermore, assuming arguendo that ARE Sikeston’s
termination of the Nalcor lease would have allowed it to
bind another party to that lease, ARE Sikeston has
offered no explanation for why it did not terminate the
lease in January 1994, once it realized that Weslock
National was unwilling to assume the obligations of that
lease.   There is no evidence in the record that ARE
Sikeston’s opportunity to exercise its right of
termination and thereby find another party to assume the
Nalcor   lease  lasted   only  from   June  1993,   when
Westinghouse foreclosed on Nalcor’s assets, to January
1994.

    We also note that, during the time that Westinghouse
and then Weslock National occupied the Sikeston Property,
each occupant paid rent as well as the cost of insurance.

                           -35-
Weslock National even paid for maintenance and upkeep of
the premises during its occupancy.          ARE Sikeston
consequently received nineteen months of rental income
that it might not otherwise have received.      For these
reasons, we hold that ARE Sikeston was not injured by the
alleged fraud of either Weslock National or Westinghouse.
Cf. Herberer, 744 S.W.2d at 444 (holding that, where a
gas station manager agreed to an extension of the lease
on his existing gas station in exchange for the oil
company’s promise that the manager could run a new
station, the manager could not bring an action for fraud
after the oil company reneged on its promise because the




                           -36-
lost profits at the new station were not the “natural and
probable consequence” of the manager’s reliance on the
oil company’s promise to grant him the right to operate
the new station); Thoroughbred Ford, 908 S.W.2d at 736
(holding that plaintiffs failed to prove with reasonable
certainty that misrepresentation caused lost profits at
least in part because defendant produced evidence that
indicated profits were unlikely due to poor market
conditions).

    Thus, because we conclude as a matter of law that
none of the exceptions to the general rule of
nonliability apply, we must follow Missouri’s general
rule for asset purchases. We therefore hold that Weslock
National is not liable for Nalcor’s contractual
obligations.    Accordingly, we hold that the district
court did not err in granting summary judgment to Weslock
National on ARE Sikeston’s breach of contract claim.

                          III.

    ARE Sikeston argues that the district court erred in
granting summary judgment on ARE Sikeston’s claim for
breach of covenants arising through privity of estate.
According to ARE Sikeston, Weslock National and ARE
Sikeston are in privity of estate and that, by virtue of
this privity of estate, Weslock National is liable for
performance of covenants running with the leasehold that
are contained in the Nalcor lease. We disagree.

    For ARE Sikeston and Weslock National to have been in
privity of estate such that Weslock National was
obligated to perform the obligations contained in the

                           -37-
Nalcor lease, Weslock National needed to acquire Nalcor’s
leasehold by assignment.     Cf. Siragusa v. Park, 913
S.W.2d 915, 918 (Mo. Ct. App. 1996) (“Upon an assignment
by the lessee, the privity of estate between the lessee
and lessor is destroyed, and a new privity of estate is
created between the assignee and the lessor.” (emphasis
added)); Newfeld v. Chemical Dynamics, Inc., 784 S.W.2d
240, 242 (Mo. Ct. App. 1989)




                           -38-
(“When Chemical assigned the leasehold, the privity of
estate between Chemical and the original owners was
destroyed and a new privity of estate was created between
the owners and, the assignee, Lawrence Newfeld.”
(emphasis added)); Hudson v. Price, 273 S.W.2d 518, 522
(Mo. Ct. App. 1954) (“When the lease was originally
executed a privity of contract and a privity of estate
existed between lessor (plaintiff) and lessee. When the
lessee assigned the lease to defendant, the privity of
contract continued between lessor (plaintiff) and lessee,
and the privity of estate existed between lessor
(plaintiff) and assignee (defendant) for the unexpired
term of the lease.” (first emphasis added; second
emphasis in original)); Mutual Drug Co. v. Sewall, 182
S.W.2d 575, 578 (Mo. 1944) (“The assignment . . . from
Quapaw to plaintiff did not specifically provide for
payment of rent to Fitch, but the assignment created
between the original lessor Fitch and plaintiff privity
of estate . . . .” (emphasis added)).

    As discussed above, Weslock National did not assume
the obligations of the Nalcor lease, but instead
expressly rejected those obligations. Therefore, Weslock
National was never assigned the lease.         Cf. South
Lakeview Plaza v. Citizens Nat’l Bank of Greater St.
Louis, 703 S.W.2d 84, 86 (Mo. Ct. App. 1985) (“[W]here an
assignment is in fact accepted by the assignee to whom it
is given, the assignment is absolutely effective . . . .”
(emphasis added)); Hahn v. Earth City Corp., 625 S.W.2d
640, 643 (Mo. Ct. App. 1981) (“If the assignor expressly
delegates his duties and the assignee expressly promises
to perform those duties, the assignee becomes liable to
the original contracting party on a creditor beneficiary

                           -39-
theory.” (emphasis added)). As a result, there was no
privity of estate and hence Weslock National was never
obligated to perform covenants running with the Nalcor
leasehold.     Accordingly, summary judgment on ARE
Sikeston’s breach of covenant claim was proper.




                         -40-
                                         IV.

    ARE Sikeston argues that the district court erred in
granting summary judgment on ARE Sikeston’s fraud7 and
tortious interference with contract claims. We disagree.

    To bring a claim for fraud, ARE Sikeston must prove
that the alleged fraud proximately caused injury. Slone,
927 S.W.2d at 371.     Similarly, to bring a claim for
tortious interference with a contract or business
expectancy, ARE Sikeston must prove that the alleged
interference caused damages. See id. at 369-70; see also
Nazeri v. Missouri Valley College, 860 S.W.2d 303, 316
(Mo. 1993) (en banc). In both its fraud claim and its
tortious interference with contract claim, ARE Sikeston
alleges essentially the same facts. ARE Sikeston alleges
that, by concealing the August 4, 1993 transaction,
Weslock National prevented ARE Sikeston from exercising
its right to terminate the Nalcor lease and thereby
prevented ARE Sikeston from obtaining the benefits of
that lease.

    As we have already discussed, ARE Sikeston has not
made a showing sufficient to establish the existence of
evidence that Weslock National’s conduct caused injury or
damages--an element essential to its cause of action for
both fraud and intentional interference with contract.
Accordingly, summary judgment on ARE Sikeston’s fraud and
intentional interference claims is proper. See Celotex


      7
       In addition to arguing that the August 4, 1993 transaction fits within the fraud
exception to the general rule of nonliability for a purchaser of corporate assets, ARE
Sikeston also brings a separate claim for fraud.

                                         -41-
Corp., 477 U.S. at 322.

                          V.

    ARE Sikeston argues that the district court erred in
granting summary judgment because the August 4, 1993
foreclosure sale of Nalcor’s assets to Weslock National




                          -42-
constituted a fraudulent conveyance of real property
rights.   We reject this argument for the same reasons
that we reject ARE Sikeston’s claims of fraud in the
August 4, 1993 transaction.

                           VI.

    ARE Sikeston argues that it should have been granted
leave to amend its complaint to state claims against
Westinghouse or, in the alternative, that the district
court should have remanded the case to Missouri state
court where ARE Sikeston originally brought this action.
We disagree.

    We review the district court’s decision to deny ARE
Sikeston’s motion for leave to amend its complaint for
abuse of discretion.    Wald v. Southwestern Bell Corp.
Customcare Med. Plan, 83 F.3d 1002, 1005 (8th Cir. 1996).
Although leave to amend should be freely granted to
insure that a case is decided on its merits, “permission
need not be granted after undue delay or where amendment
would be futile.” Ferguson v. Cape Girardeau County, 88
F.3d 647, 650-51 (8th Cir. 1996).

    The district court denied leave to amend because it
concluded that “[a]t this late stage in the proceedings
it is inappropriate for the Court to allow the plaintiff
to amend.”    ARE Sikeston, 932 F. Supp. at 241.     The
district court explained that “[t]here is no new factual
basis put forth nor any reason for the Plaintiff’s
delay.” Id. In addition, the district court noted that
“the inclusion of [ARE Sikeston’s] new suggested party[,
Westinghouse,] would violate diversity and require

                           -43-
remand.”   Id.

    We conclude that the district court properly denied
ARE Sikeston’s motion for leave to amend and denied ARE
Sikeston’s motion in the alternative for remand. With
respect to the delay, ARE Sikeston did not seek to assert
any claims against Westinghouse until more than sixteen
months after it filed suit for the alleged breach of the
Nalcor lease.   In addition, it took ARE Sikeston more
than five months to move




                           -44-
for leave to assert claims against Westinghouse even
after Weslock National brought its third-party complaint
against Westinghouse.

    The only explanation that ARE Sikeston offers for
this delay is that, because it originally did not know of
the August 4, 1993 transaction between Weslock National
and Westinghouse, ARE Sikeston did not know of
Westinghouse’s role in the alleged breach of the Nalcor
lease.   However, as early as June 1993, nearly three
years before ARE Sikeston sought to bring its amended
complaint against Westinghouse, ARE Sikeston knew that
Westinghouse had taken possession of Nalcor’s assets at
the Sikeston Property and that Westinghouse planned to
sell those assets. ARE Sikeston also knew, at roughly
the same time, that Westinghouse had indicated that the
purchaser of Nalcor’s assets would be ARE Sikeston’s new
tenant at the Sikeston Property.       Insofar as these
actions provide the only basis for the claims that ARE
Sikeston now seeks to bring against Westinghouse, we find
ARE Sikeston’s explanation for its delay lacking.

    Furthermore, we also note that the district court did
not have subject matter jurisdiction over ARE Sikeston’s
claims against Westinghouse. Because the claims that ARE
Sikeston sought to bring against Westinghouse involve
only state law claims, diversity of citizenship would
have been the only basis for the original jurisdiction of
the district court. However, joining Westinghouse as a
defendant would eviscerate the district court’s original
jurisdiction because both ARE Sikeston and Westinghouse
are citizens of Pennsylvania. See Caterpillar Inc. v.
Lewis, 117 S. Ct. 467, 472 (1996) (construing 28 U.S.C.

                           -45-
§ 1332(a) to find a requirement of complete diversity
between opposing parties).

    In addition, the district court did not have
supplemental jurisdiction over ARE Sikeston’s claims
against Westinghouse. Under 28 U.S.C. § 1367(b), “[i]n
any civil action of which the district courts have
original jurisdiction founded solely on section 1332 of
this title [diversity jurisdiction], the district courts
shall not have supplemental




                          -46-
jurisdiction under [§ 1367(a)] over claims by plaintiffs
against persons made parties under Rule 14 . . . .” 28
U.S.C. § 1367(b) (1994). In the instant action, although
the district court’s removal jurisdiction was based on 28
U.S.C. § 1441, its original jurisdiction was founded
solely on § 1332, and Westinghouse, as a third-party
defendant, was made a party pursuant to Rule 14.      See
Fed. R. Civ. P. 14(a) (governing when a defendant, as a
third-party plaintiff, can bring an additional party into
an action as a third-party defendant). Thus, § 1367(b)
bars the district court from exercising supplemental
jurisdiction   over   ARE   Sikeston’s   claims   against
Westinghouse.

    Without either original jurisdiction or supplemental
jurisdiction   over   ARE   Sikeston’s  claims   against
Westinghouse, the district court did not have subject
matter jurisdiction over those claims.         Moreover,
Westinghouse was not a party indispensable to the
adjudication of ARE Sikeston’s claims against Weslock
National. As a result, the district court could, in its
discretion, choose either to deny ARE Sikeston’s motion
for leave to amend or to grant the motion and remand the
case to state court. See 28 U.S.C. § 1447(e) (1994) (“If
after removal the plaintiff seeks to join additional
defendants whose joinder would destroy subject matter
jurisdiction, the court may deny joinder, or permit
joinder and remand the action to the State court.”
(emphasis added)).    Given the lack of subject matter
jurisdiction and the undue delay caused by ARE Sikeston,
we hold that the district court did not abuse its
discretion in denying ARE Sikeston’s motion for leave to
amend or in denying ARE Sikeston’s request for a remand.

                           -47-
                                        VII.

      For the foregoing reasons, we affirm.8




      8
         We also conclude that Weslock National’s cross-appeal is moot. In its cross-
appeal, Weslock National argued that, because the district court’s grant of summary
judgment to Westinghouse was premised entirely on the district court’s conclusion that
Weslock National was entitled to summary judgment, this Court should reverse the
district court’s grant of summary judgment to Westinghouse if we found that the district
court had improperly granted summary judgment to Weslock National. Because we
hold that the district court properly granted summary judgment to Weslock National,
we agree with the district court that Westinghouse is entitled to summary judgment on
Weslock National’s indemnification and contribution claims. In addition, because we
hold that the district court’s grants of summary judgment to Weslock National and
Westinghouse were proper, ARE Sikeston’s argument that the district court erred in
denying ARE Sikeston’s motion to reconsider is also moot.

                                         -48-
A true copy.


    Attest:


        CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




                      -49-
