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Michigan-Ann Arbor-24 Frank Lloyd Wright Drive Lease - Domino's Farms Holding LP and Aastrom Biiosciences Inc.

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                                     LEASE
                                     -----
 
        THIS LEASE is made as of this 18 day of May, 1992, between the following
parties:

LANDLORD:                            TENANT

Domino's Farms Holding               AASTROM Biosciences, Inc.
Limited Partnership                  Post Office Box 130469
(a Michigan corporation)             Ann Arbor, Michigan 48113-0469
24 Frank Lloyd Wright Drive 
Ann Arbor, MI 48105

LEASE OF PREMISES:
-----------------

        In consideration of the rents to be paid and the covenants and 
agreements to be performed hereunder, Landlord hereby leases to TENANT and 
TENANT hereby leases from Landlord the PREMISES (defined below).

SUMMARY OF LEASE TERMS:

        The following is intended to summarize certain basic terms of this
Lease, and is not intended to be exhaustive. In the event anything set forth in
this Summary of Lease Terms ("SUMMARY") conflicts with the other specific
provisions of this Lease contained in the Standard Lease Terms, the latter shall
be deemed to control.

        A. BUILDING:

           The office building known as Phase 5 of the Domino's Farms Prairie
           House Office Complex and located at 24 Frank Lloyd Wright Drive, Ann
           Arbor, MI 48105.


        B. PREMISES:

           OFFICE/LABORATORY SQUARE FOOTAGE: 
           Approximately 4,592 of usable square feet of space.

           Location: Office and laboratory space located between column lines 25
                     and 29, and A and C, on Level 2 of Phase 5. Perimeters of
                     premises are as defined by BOMA (Building Owners & Managers
                     Association) standards, and are as shown on Rider A-1.

           Address:  24 Frank Lloyd Wright Drive 
                     Ann Arbor, MI 48105

        C. TERM:

           COMMENCEMENT DATE:          1.           ,  19
           (check one)          ------    ----------     ---------

                                 XX    2. See Section 3.03
                                ----
           EXPIRATION DATE:     Two years and eight months after Commencement
                                Date, subject to renewal as set forth in Rider
                                D.

        D. RENT:
           Months 1 and 2       The monthly rental charge will be equal to $2.31
                                per square foot for utilities, or $883.96.

 
<PAGE>
 
            Months 3-32        The monthly rental charge will be $8,919.96. This
                               amount is equal to $107,039.52 annually, based
                               upon a gross amount of $23.31 per square foot
                               ($21.00 per square foot for rent plus $2.31 per
                               square foot for utilities).

        E.  PERMITTED USES:    Office and laboratory

        F.  SECURITY DEPOSIT:  $8,919.96

        G.  TENANT'S PROPORTIONATE SHARE: Not applicable

        H.  LANDLORD'S AGENT:  Domino's Farms Corporation

        I.  MAILING ADDRESS:   Domino's Farms Corporation 
                               24 Frank Lloyd Wright Drive
                               P.O. Box 445
                               Ann Arbor, MI 48105


RIDERS ATTACHED:
---------------

        RIDER A Floor Plan of Building 
                Layout of Space Site Plan

        RIDER B Work Agreement

        RIDER C Rules and Regulations

        RIDER D Addendum to Lease

        RIDER E Right of First Refusal

        RIDER F Attornment

        RIDER G Hazardous Materials

        RIDER H To Be Attached at Lease Commencement:

                Construction Documents
                Specifications
                Warranties and Manuals
                List of Tenant-owned Equipment
                Financial Compilation
<PAGE>
 
STANDARD LEASE TERMS
--------------------

                                   SECTION 1

                                  DEFINITIONS

1.01    Definitions:   In addition to words and phrases defined in these
        -----------
Standard Lease Terms, the words and phrases in the Summary of Lease Terms shall
have the meanings set forth therein.

                                   SECTION 2

                           AMENITIES AND COMMON AREA

2.01    Amenities:   Tenant's lease of the Premises shall include the
        ---------
nonexclusive right to the use of such building amenities as are generally made
available to tenants of the Building.* The use and the availability of all such
amenities shall be subject to the reasonable rules and regulations established
by Landlord or the respective proprietor or operator of such amenities and
subject to such prices or fees as may be established from time to time for the
use of availability of any amenity. In addition, Tenant shall be entitled to
unreserved parking spaces in the parking area provided for the Building,
together with the nonexclusive right to use the walkways and other means of
ingress and egress over the land surrounding the Building, and all other rights
of ingress and egress provided for use in common by all owners and tenants of
the Building.

2.02    Common Area:   The term "Common Area" means that part of the Building
        -----------
intended by Landlord for the common use of all tenants, including, but not
limited to, lobbies, public entrances, restrooms, stairways, elevators,
corridors, parking areas and walkways. Tenant, and its employees and licensees,
shall have the nonexclusive right to use the Common Area with other tenants and
other persons permitted by Landlord to use the same. Tenant shall not take any
action which would interfere with the rights of other persons to use the Common
Area.

                                   SECTION 3

                                   THE TERM

3.01    Term:   The Term of this Lease and the payment of rent hereunder, shall
        ----
commence on the Commencement Date and shall end on the Expiration Date.

3.02    Commencement Date - Date Certain:   If item C1 of the Summary of Lease
        --------------------------------
Terms is checked and a date inserted, the Commencement Date shall be such date.
In that case Landlord agrees to substantially complete the improvements to the
Building listed on the Work Agreement executed by Tenant and Landlord and
attached as Rider B (the "Work Agreement") before the Commencement Date.

3.03    Commence Date - Substantial Completion:   If item C2 of the Summary
        --------------------------------------
Lease Terms is checked or if neither item C1 nor item C2 are checked, the
Commencement Date shall be as set forth in this Section 3.03.

        A. Notice of Substantial Completion. Landlord shall give Tenant ten (10)
           --------------------------------
        business days prior written notice of the anticipated date of
        substantial completion of the work to be performed by Landlord in the
        Premises pursuant to the provisions of the Work Agreement, which is
        attached hereto as Rider B (the "Work Agreement") and incorporated
        herein.

*See Rider D
            
                                      -3-
<PAGE>
 
          The Premises shall be deemed substantially complete when Landlord has
          substantially completed the work required to be performed by Landlord
          for Tenant as provided in the Work Agreement.

          B. Delays. If there is a delay in the substantial completion of the
             ------
          Premises, or any portion thereof, due to (a) any act or omission of
          the Tenant, its architects, space designers, agents, or employees, as
          set forth in the Work Agreement including, without limitation, delays
          due to changes in the "Work" (as defined in the Work Agreement), or
          any other work to be done by the Landlord, or delays in submission of
          information, approving working drawings or estimates or giving
          authorizations or approvals, (b) any additional time for completion of
          such Work which may be required because of the inclusion in the Work
          of any work which may hereinafter be referred to in this Lease or the
          Work Agreement as "Additional Work" or (c) the noncompletion by the
          Landlord of any Work, whether in connection with the layout or finish
          of the Premises or otherwise, which the Landlord is not required to do
          by the terms hereof until after the Commencement Date; then, the
          Premises, or such portion, shall be deemed substantially complete and
          available for occupancy on the date when the Premises or such portion
          would have been available but for such delay, even though the Work or
          Additional Work to be done by Landlord has not been commenced or
          completed. Any reasonable and necessary additional cost to Landlord to
          complete the Premises occasioned by such delay shall be paid as
          additional rent upon demand. For the purposes of the preceding
          sentence, "additional cost to Landlord" shall mean the total cost
          incurred in excess of the aggregate cost which the Landlord would have
          incurred to complete the Premises if there had been no such delay.
          With respect to delays occasioned by the inclusion of "Additional
          Work" referred to in (b) above, Landlord shall advise Tenant in
          writing of the approximate number of days the Work will delay the
          substantial completion of the Premises.

          C. Termination. In the event the Premises shall not have been
             -----------
          substantially completed by Landlord on or prior to three months after
          the date of this Lease, as such date may be extended by reason of
          strikes, lockout, civil commotion, warlike operation, invasion,
          rebellion, hostilities, governmental regulations or controls,
          inability to obtain labor or materials despite reasonable diligence,
          Acts of God, or other similar causes beyond Landlord's control, then
          and in that event either Landlord or Tenant shall be entitled to
          cancel this Lease by written notice to the other and upon such
          cancellation, neither party shall have any further liability to the
          other hereunder.

3.04    Taking of Possession:  The taking of possession of the Premises shall be
        --------------------
deemed an acceptance of the same by Tenant, and shall be deemed in any event
substantial completion by Landlord of all of the improvements listed on the Work
Agreement. For the purposes of this Section, the work to be done by Landlord
shall be deemed substantially complete even though minor details or adjustments
which shall not materially interfere with Tenant's use and occupancy of the
Premises may not then have been completed, but which work Landlord agrees will
thereafter be promptly completed.

3.05    Waivers:  Tenant expressly waives any right to rescind this Lease and
        -------
further expressly waives the right to recover any damages, direct or indirect,
which may result from Landlord's failure to deliver possession of the Premises
on the Commencement




                                      -4-
<PAGE>
 
Date. The Commencement Date shall not be postponed or delayed by reason of or
arising out of delays occasioned by Tenant.

3.06    Confirmation of Lease Term: Promptly after the Commencement Date,
        --------------------------
Landlord and Tenant will execute an agreement in recordable form, hereafter
referred to as the "Commencement Date Agreement", stating, among other things,
the Commencement Date and Expiration Date of the Term of this Lease. Tenant's
failure or refusal to sign the same shall in no event affect Landlord's
designation of the Commencement Date.


                                   SECTION 4

                                 THE BASE RENT

4.01    Base Annual Rental: Tenant agrees to pay to Landlord the Base Annual
        ------------------
Rental for the original Term of this Lease without right of set-off or abatement
(except as specifically provided in Section 9 or 11).

4.02    Base Monthly Rental: The Base Annual Rental shall be payable in monthly
        -------------------
installments equal to the Base Monthly Rental, in advance, without any set-offs
or deductions (except as specifically provided in Section 9 or 11), on the first
day of each month (the "Rent Day") during the Term of this Lease at the address
shown in Paragraph I of the Summary, or at such other place as Landlord from
time to time may designate in writing. In the event the Commencement Date is
other than the first day of a calendar month, the rental for the first and last
partial months shall be prorated based on the actual number of days of such
months included within the Lease Term and based upon the amount of the Base
Monthly Rental.


                                   SECTION 5

                           LATE CHARGES AND INTEREST

5.01    Late Charges:  Any rent or other sums payable by Tenant to Landlord 
        ------------
under this Lease which are not paid by Tenant and received and accepted by 
Landlord within seven (7) days after they are due will be subject to a onetime 
late charge of five percent (5%) of the amount due. Such late charges will be 
due and payable as additional rent on or before the next Rent Day.

5.02    Interest:  Any rent, late charges or other sums, if any, payable by 
        --------
Tenant to Landlord under this Lease not paid within thirty (30) days after the 
same are due will bear interest at a per annum rate of eleven (11%) percent; 
provided however, if such rate exceeds the maximum rate of interest permitted by
law under such encumbrances, then such rate shall be reduced to the 
maximum permissible rate. Such interest will be due and payable as additional 
rent on or before the next Rent Day, and will accrue from the date that such 
rent, late charges or other sums are first payable under the provisions of this 
Lease until actually paid by Tenant.

5.03    Default:  Any default in the payment of rent, late charges or other sums
        -------
will not be considered cured unless and until the late charges and interest due 
hereunder are paid by Tenant to Landlord. If Tenant defaults in paying such late
charges and/or interest, Landlord will have the same remedies as on default in 
the payment of rent. The obligation hereunder to pay late charges and interest 
exists in addition to, and not in the place of, the other default provisions of 
this Lease.



                                      -5-

<PAGE>
 
                                   SECTION 6

                    TAXES, ASSESSMENTS, UTILITIES, SERVICES

6.01    Personal Property Taxes:  Tenant shall be responsible for and pay all
        -----------------------
personal property taxes assessed against Tenant's fixtures, equipment and other
property of Tenant located on the Premises.

6.02    Taxes and Assessments:
        ---------------------

6.03    Utilities:
        --------- 




                                      -6-
<PAGE>
 
        A.  Utilities to be Furnished:  So long as Tenant is not in default 
            -------------------------        
        under the terms of this Lease, Landlord shall furnish the following
        utilities ("Utilities"):

                (1). Electricity 

                (2). Air conditioning and heat during the appropriate season, as
                provided in the Rules and Regulations attached as Rider C; and

                (3). Hot and cold water for lavatory purposes.

        B.  Tenant's Utilities Share: Tenant agrees to pay to Landlord, as
            ------------------------
        Additional Rent for the Premises, $2.31 per square foot for utility
        charges.

6.04    Telecommunications:  Tenant shall arrange and pay for its own telephone 
        ------------------
or other telecommunications services, subject to Landlord's prior written 
approval of the means of installation of such service(s).

                                   SECTION 7

                               USE OF PREMISES 

7.01    Permitted Uses:  The Premises will be used and occupied by Tenant for 
        --------------
the Permitted Uses and for no other purpose without prior written consent of
Landlord. Tenant agrees that it will not use or permit any person to use the
Premises or any part thereof for any use or purposes in violation of the laws of
the United States, the laws, ordinances or other regulations of the State and
municipality in which the Premises are located, or of any other lawful
authorities. During the Term or any extension, Tenant will keep the Premises and
every part thereof in a clean and wholesome condition and will comply with all
lawful health and police regulations and with the Rules and Regulations attached
as Rider C.

7.02    Rules and Regulations:  The Landlord may, from time to time, establish 
        ---------------------
reasonable rules and regulations ("Rules and Regulations") for use of the 
Premises, the Building and the Common Areas by Tenant and all other persons. 
Those Rules and Regulations in effect on the date of this Lease are attached as 
Rider C. All such rules and regulations may be amended or replaced, at 
Landlord's option, upon written notice to Tenant (sent by mail or otherwise 
delivered to the Premises).  All such amendments or replacements shall be deemed
to automatically amend and replace those Rules and Regulations set forth in 
Rider C.

                                   SECTION 8

                                   INSURANCE

8.01    Liability Insurance:  Tenant shall obtain, at its own expense, 
        -------------------
comprehensive general liability insurance coverage, including blanket 
contractual coverage, against claims for or arising out of bodily injury, death 
or property damage occurring in, on or about the Premises, which policy or 
policies shall name Landlord as an additional insured. The policy may be either 
a dual limit policy in the amounts of $1,000,000 per person and $1,000,000 per 
occurrence for bodily injury and $1,000,000 per occurrence for property damage
or a single limit policy in the amount of $1,000,000. Landlord may require that
the limits of such insurance be increased in reasonably appropriate amounts as



                                      -7-
<PAGE>
 
may be determined by Landlord or any mortgagee of the Building; provided, 
however, that the amount of coverage will not be increased more frequently than 
at one (1) year intervals.  Such policy shall be issued by an insurance company 
acceptable to Landlord.  The policy procured by Tenant under this Subsection 
8.01 must provide for at least thirty (30) days' written notice to Landlord of 
any cancellation.  On or before the Commencement Date, Tenant shall deliver to 
Landlord, at Landlord's option, a certificate of insurance or a certified copy 
of the original policy, together with receipts evidencing payment of the 
premiums therefor.  Tenant will deliver certificates of renewal for such 
policies to Landlord at least thirty (30) days prior to the expiration dates 
thereof.  The insurance provided by Tenant under this Subsection 8.01 may be in 
the form of a blanket insurance policy covering other properties as well as the 
Premises; provided, however, that Tenant must furnish Landlord with a written 
statement from the insurer(s) under such policy or policies which statement 
shall (i) specify the policy limits of the policy or policies, (ii) state that 
the Premises and this Lease are covered by such policy or policies and (iii) 
state the amount of total insurance allocated to the Premises; provided, 
further, that any such policy or policies of blanket insurance must, as to the 
Premises, otherwise comply as to insurance amounts, endorsements, notice of 
cancellation and coverage with the other provisions of this Subsection 8.01.

8.02    Insurance for Leasehold Improvements:  Tenant shall obtain, at its
        ------------------------------------
own expense, a policy to insure the leasehold improvements to be made to the 
Premises and any other fixtures or equipment of Tenant which will remain the 
property of Landlord under Section 18 of this Lease.  The policy shall name 
Landlord as an additional insured for full replacement cost against loss by 
fire, with standard extended risk coverage, vandalism, malicious mischief, 
sprinkler leakage and all other risk perils.

8.03    Replacement Cost:  Tenant may, at his or her option, maintain 
        ----------------
insurance for full replacement cost of property of Tenant located in or about 
the Premises.  Landlord shall not be responsible for any damage or loss to 
property of the tenant located in or about the premises.

                                    DAMAGE

9.01    Damage:  If the Premises are damaged or destroyed in whole or in part
        ------
by any fire or other casualty during the Term hereof, Landlord, to the extent 
insurance proceeds are available to Landlord, will repair and restore the same 
to good tenantable condition with reasonable dispatch, and that the rent herein 
provided for shall abate entirely in case the entire Premises are untenantable 
and pro rata on an equitable basis for the portion rendered untenantable,
    --------
in case a part only is untenantable, until the same shall be restored to a
tenantable condition. The foregoing shall be subject to all of the following:
(i) if Tenant shall fail to adjust its own insurance or to remove its damaged
goods, wares, equipment or property within a reasonable time, and as a result
thereof the repairing and restoration is delayed, there shall be no abatement of
rental during the period of such resulting delay; (ii) that there shall be no
abatement of rental if such fire or other cause damaging or destroying the
Premises shall result from the negligence or willful act of Tenant, its agents,
servants, visitors, licensees, invitees or employees; (iii) that if Tenant shall
use any part of the Building other than the Premises for storage, during the
period of repair, a reasonable charge shall be made therefor against Tenant;
(iv) that in case the Premises or the Building shall be destroyed to the extent
of more than one-half (1/2) of the value thereof, Landlord may at its option
terminate this Lease
                                      -8-
<PAGE>
 
forthwith by a written notice to Tenant stating the date upon which this Lease 
will terminate.

                                  SECTION 10

                            MAINTENANCE AND REPAIRS

10.01   Maintenance and Repairs:  Landlord will maintain, repair and keep
        -----------------------
all structural, electrical, mechanical and plumbing systems of the Building
(other than such systems installed by Tenant) and any other improvements on the
land which serve the entire Building, including the parking lot, at all times,
in good appearance and repair except for reasonable and normal wear and tear.
Landlord will also maintain the grounds, sidewalks, driveways and parking areas.
Landlord assumes the responsibility for the operation, security, management,
maintenance and repair of the Common Area.

10.02   Cost of Repairs.  From and after the date Tenant takes possession
        ---------------
of the Premises, and excluding and items described in the Work Agreement as 
Landlord's Work and those items subject to the preceding Section 10.01, any 
repairs, additions or alterations to the Building including any of its systems 
(e.g., plumbing, electrical, mechanical) structural or nonstructural, or to the 
Premises, which are required by any law, statute, ordinance, rule, regulation
or governmental authority or insurance carrier, including, without limitation, 
OSHA, arising out of Tenant's use or occupancy of the Premises, will be made by 
Landlord at Tenant's expense including, without limitation, those which require 
the making of any structural, unforseen or extraordinary changes.  The foregoing
shall not apply to any such repairs that are required because of Landlord's use 
of the Building generally as an office building.  Tenant agrees to pay the total
costs incurred by Landlord for repairs made under this Subsection 10.02 within 
thirty (30) days after the delivery of an invoice for same.  All amounts payable
under this Section 10.02 will be additional rental and failure by Tenant to pay 
them when due will be a default under this Lease and, in addition to any other 
remedies provided in this Lease upon default, will result in the assessment of 
late charges and interest as set forth in Section 5.

10.03   Maintenance:  Tenant agrees at its own expense to maintain the Premises 
        -----------
and all improvements thereto, including any improvements made by Tenant, at all 
times in good appearance and repair except for reasonable and normal wear and 
tear.

10.04   Janitorial Services:  Landlord will provide janitorial services to the 
        -------------------
Premises.  Tenant is responsible for the removal of any and all hazardous 
materials, to be handled in accordance with Rider G of this lease.

                                  SECTION 11

                     INTERRUPTION OF SERVICES OR UTILITIES

11.01   Interruption of Utilities:  Interruption or curtailment of any Utility
        -------------------------
for any reason or interruption or curtailment of any service maintained in the 
Building, if caused by strikes, mechanical difficulties, or any causes or acts 
beyond Landlord's control, whether similar or dissimilar to those enumerated, 
shall not entitle Tenant to any claim against Landlord or to any abatement in 
rent, nor shall the same constitute constructive or partial eviction, unless 
Landlord fails to take such measures as may be reasonable in the circumstances 
to restore the service or Utility without undue delay.  In the event that the 
Tenant would elect to bring in portable generators or other similar equipment, 
Landlord will cooperate with installation of  If the Premises are rendered 
untenantable in whole or in part for a period of over three (3) full business 
days, by the making of repairs, replacements or additions, other than those made
at Tenant's request or caused by misuse or neglect by Tenant or Tenant's agents,
servants,

                                      -9-
<PAGE>
 
visitors, invitees, licensees or employees or those required by any governmental
authority due to the nature of Tenant's use of the Premises, there shall be a 
proportionate abatement of rent during the period of such untenantability.

                                  SECTION 12

                   PAYMENT FOR SERVICES RENDERED BY LANDLORD

12.01   Payment for Services:  If Landlord at any time (i) does any work
        --------------------
or performs any service in connection with the Premises, or (ii) supplies any 
materials to the Premises, and the cost of such services, work or materials is 
Tenant's responsibility under the provisions of this Lease, Landlord will 
invoice Tenant for the reasonable cost, payable on the next Rent Day or within 
ten (10) days after delivery of the invoice, whichever is later.  This Section 
12.01 will apply to any such work, service or materials, whether furnished at
Tenant's request or on its behalf and whether furnished or caused to be
furnished by Landlord, its agents, employees or contractors. All amounts payable
under this Section 12.01 will be additional rental and failure by Tenant to pay
them when due will be a default under this Lease and, in addition to any other
remedies provided in this Lease upon default, will result in the assessment of
late charges and interest under Section 5. This Section 12.01 shall not apply to
Total Tax Assessments as defined in Section 6 nor to Utility Expenses as defined
in Section 19.01.

                                  SECTION 13

                                  ALTERATIONS

13.01   Alterations:  Landlord will make any structural alterations, additions,
        -----------
or improvements, exterior or interior, to the Premises including alterations 
made at the request of Tenant and which have been approved by Landlord.  
Landlord's consent for any interior improvements will not be unreasonably 
withheld; provided that Landlord's consent to exterior improvements may be 
withheld in Landlord's sole and absolute discretion.  Any modification of the 
Premises other than as specifically set forth in the Work Agreement as 
Landlord's expense will be at the expense of Tenant.

13.02   Restoration of Premises:  All alterations, additions and improvements
        -----------------------
made by either of the parties hereto on the Premises will be the property of
Landlord and will remain on and be surrendered with the Premises at the 
termination of this Lease provided, however, that Tenant shall remove, at 
Landlord's option, all alterations, additions or improvements to the Premises 
made for Tenant and Tenant shall pay to Landlord to restore the Premises to the 
conditions stated in the Work Agreement, (Rider B), if notified in writing by 
Landlord.

                                  SECTION 14

                                     LIENS

14.01   Liens:  After the Commencement Date, Tenant will keep the Building,
        -----
Premises and surrounding land free of liens of any sort attributable to the acts
of Tenant and will hold Landlord harmless from any liens which may be placed on 
the Building, Premises or surrounding land except those attributable to the acts
of Landlord or other tenants.

                                  SECTION 15

                                EMINENT DOMAIN

15.01   Eminent Domain:  If the Premises or any part thereof are taken by any
        --------------
public authority under power of eminent domain, or by private

                                     -10-


<PAGE>
 
sale in lieu of eminent domain, this Lease will terminate as of the date of such
taking or sale, and Tenant may receive a pro rata refund of any rents, deposits 
or other sums paid in advance.  Landlord reserves the right, however, to elect 
to demolish, rebuild or reconstruct the Building if any portion of the Building 
is so taken, and if Landlord so elects, whether or not the Premises are involved
in the taking, this Lease may be terminated by Landlord on 90 days written 
notice to Tenant and the rent will be adjusted to the date Tenant's 
possession of the Premises is terminated.

15.02   Condemnation Award:  The whole of any award or compensation for any 
        ------------------
portion of the Premises taken, condemned or conveyed in lieu of taking or 
condemnation shall be solely the property of and payable to Landlord.  Nothing 
herein contained shall be deemed to preclude Tenant from seeking at its own cost
and expense, an award from the condemning authority for loss of its business, 
the value of any trade fixtures or other personal property of Tenant in the 
Premises or moving expenses, provided that the award for such claim or claims 
shall not be in diminution of the award made to Landlord.

                                  SECTION 16

                           ASSIGNMENT OR SUBLETTING

16.01   Assignment or Subletting:  Tenant agrees not to assign or in any manner
        ------------------------
transfer this Lease or any interest in this Lease without the previous written
consent of Landlord, and not to sublet the Premises or any part of the Premises 
or allow anyone to use or to come in, with, through or under it without like 
consent, which consent, in each case, will not be unreasonably withheld.  Upon 
any attempted unconsented to assignment or sublease, Landlord shall have the 
right to terminate this Lease.  One such consent will not be deemed a consent to
any subsequent assignment, subletting, occupation or use by any other person.  
Any sublease on the Premises executed by Tenant and a third party must terminate
when the Term of this Lease expires.  The acceptance of rent from an assignee, 
subtenant or occupant will not constitute a release of Tenant from the further 
performance of the obligations of Tenant contained in this Lease.  In the event 
of any such assignment or sublease of all or any portion of the Premises where 
the rental or other consideration reserved in the sublease or by the assignment 
exceeds the rental or pro rata portion of the rental, as the case may be, for 
such space reserved in this Lease, Tenant agrees to pay Landlord monthly, as 
additional rent, on the Rent Day, the excess of the rental net of recovery of 
Tenant-paid improvement costs or other consideration reserved in the sublease 
or assignment over the rental reserved in this Lease applicable to the 
subleased/assigned space.

                                  SECTION 17

                 INSPECTION AND ALTERATION OF PUBLIC PORTIONS

17.01   Inspection:  Tenant agrees to permit Landlord and the authorized
        ----------
representatives of Landlord to enter the Premises at all times for the purpose 
of inspecting the same, subject to confidentiality agreements if requested by 
Tenant.

17.02   Right to Enter and Alter Premises:  Upon notice from Landlord, Tenant
        ----------------------------------
shall permit Landlord to erect, use and maintain pipes and conduits in and 
through the Premises.  Landlord or its agents or designees shall have the right 
to enter the Premises, for the purpose of making such repairs or alterations as 
Landlord shall be required or shall have the right to make by the provisions of 
this Lease and, subject to the foregoing, shall also have the right to enter the
Premises for the purpose of exhibiting them to prospective purchasers or lessees
of the Building or to prospective mortgages or to prospective assignees

                                     -11-


<PAGE>
 
of any such mortgages.  Landlord shall be allowed to take all material into and 
upon the Premises that may be required for the repairs or alterations above 
mentioned without the same constituting an eviction of Tenant in whole or in 
part, and the rent reserved shall in no wise abate, except as otherwise provided
in this Lease, while said repairs or alterations are being made.

17.03   Right to Show Premises:  During the three (3) months prior to the 
        ----------------------
expiration of the Term of this Lease, Landlord may exhibit the Premises to 
prospective tenants during normal business hours.

17.04   Right to Alter Public Portions of Buildings:  Landlord shall have the
        -------------------------------------------
right at any time without thereby creating an actual or constructive eviction or
incurring any liability to Tenant therefore, to change the arrangement or
location of entrances, passageways, doors, and doorways, corridors, stairs,
toilets and other like public service portions of the Building. Tenant shall at
all times be provided with an entrance to the Premises.

17.05   Name of Building:  Landlord shall have the right at any time to name the
        ----------------
Building for any person(s) or tenant(s) and to change any and all such names at 
any time thereafter.

                                  SECTION 18

                            FIXTURES AND EQUIPMENT

18.01   Landlord's Property:  All fixtures and equipment paid for by Landlord
        -------------------
and all improvements, fixtures and equipment which may be paid for and placed on
the Premises by Tenant from time to time but which are so incorporated and 
affixed to the Premises that their removal would involve damage or structural 
change to the Premises, will be and remain the property of Landlord, excepting 
those items specifically listed in the Work Agreement.  Tenant will be 
responsible for the cost of repair due to removal of specified items.

18.02   Tenant's Property:  All improvements, furnishings, equipment and
        -----------------
fixtures other than those specified in Subsection 18.01, which are paid for and 
placed on the Premises by Tenant from time to time will remain the property of 
Tenant and be removed by Tenant at the expiration of the Lease.

                                  SECTION 19

                               UTILITY EXPENSES

19.01   Definitions:
        -----------

        (i) "Utility Expenses" means any and all charges for heat, air
        conditioning, ventilating, and steam, gas, electricity, water or
        other fuels made against the Entire Premises and all labor services
        and materials related thereto which are delivered or provided to or
        with respect to the Entire Premises.

        (ii) "Tenant's Proportionate Share of Utilities" means Utility Expenses
        multiplied by the percentage set forth in Paragraph G of the Summary.

        (iii) "Utility Expense Statements" means written statements, certified
        by Landlord, showing the amounts of Utility Expenses for each calendar
        year which includes any portion of the Term or any renewal or extension
        thereof.

19.02   Utility Expenses:  Tenant will pay to Landlord as Additional Rent $2.31 
        -----------------
per square foot for Utility Expenses.

                                     -12-


<PAGE>
 
Payments due pursuant to this Section will be due at the time specified in 
Section 6.03.

19.03   Utility Expense Statement:  Any Utility Expense Statement sent to
        -------------------------
Tenant shall be conclusively binding upon Tenant unless, within thirty (30) days
after such statement is sent, Tenant shall send a written notice to Landlord 
objecting to such statement and specifying the respects in which such statement 
is claimed to be incorrect.  If such notice is sent, either party may refer the 
decision of the issues raised by such notice to Arthur Andersen & Co., or any 
successor firm, or other reputable independent firm of certified public 
accountants selected by Landlord, and the decision of such accountants shall be 
conclusively binding upon the parties.  The fees and expenses involved in such 
decision shall be borne by the unsuccessful party (and if both parties are 
partially unsuccessful, the accountants shall apportion such fees and expenses 
between the parties, based on the degree of success of each party).

                                  SECTION 20

                              NOTICES OR DEMANDS

20.01   Notices or Demands.  All bills, notices, statements, communications
        ------------------
or demands (collectively, "notices or demands") upon Landlord or Tenant desired 
or required to be given under any of the provisions hereof must be in writing.  
Any such notices or demands from Landlord to Tenant will be deemed to have been 
duly and sufficiently given if a copy thereof has been personally delivered or 
mailed by United States mail in an envelope properly stamped and addressed to 
Tenant at the address of the Premises or at such other address as Tenant may 
have last furnished in writing to Landlord for such purpose.  Any such notices 
or demands from Tenant to Landlord will be deemed to have been duly and 
sufficiently given if personally delivered to Landlord or mailed by United 
States mail in an enveloped properly stamped and addressed to Landlord at the 
address set forth in this Lease.  The effective date of such notice or demand 
will be deemed to be the time when personally delivered or mailed as herein 
provided.

                                  SECTION 21

                         BREACH;  INSOLVENCY; RE-ENTRY

21.01   Default:  If any rental payable by Tenant to Landlord remains unpaid
        -------
for more than seven (7) days after written notice to Tenant of nonpayment, or if
Tenant violates or defaults in the performance of any of its obligations in this
Lease and the 

                                     -13-
<PAGE>
 
violation or default continues for a period of ten (10) days after written
notice, then Landlord may (but will not be required to) declare this Lease
forfeited and the Term ended, or re-enter the Premises, or may exercise all
other remedies available under Michigan law. Landlord will not be liable for
damages to person or property by reason of any legitimate re-entry or
forfeiture, and Landlord will be aided and assisted by Tenant, its agents,
representatives and employees. Tenant, by the execution of this Lease, waives
notice of re-entry by Landlord. In the event of re-entry by Landlord without
declaration of forfeiture, the liability of Tenant for the rent provided herein
will not be relinquished or extinguished for the balance of the Term, and any
rentals prepaid may be retained by Landlord and applied against the costs of re-
entry, or the costs of enforcement of this Lease, including the cost of any
proceeding under the Federal Bankruptcy Code.

21.02   Bankruptcy:  If Tenant is adjudged bankrupt or insolvent, files or 
        ----------
consents to the filing of a petition in bankruptcy under Federal or State law,
applies for or consents to the appointment of a receiver for all or
substantially all of its assets, or makes a general assignment for the benefit
of its creditors, then Tenant shall be in default under this Lease and, to the
extent from time to time permitted by applicable law, including but not limited
to the Federal Bankruptcy Code, Landlord shall be entitled to exercise all
remedies set forth in Section 21.01. In a reorganization under Chapter 11 of the
Federal Bankruptcy Code, the debtor or trustee must assume this Lease or assign
it within sixty (60) days from the filing of the proceeding, or he shall be
deemed to have rejected and terminated this Lease. Tenant acknowledges that its
selection to be the tenant hereunder was premised in material part on Landlord's
determination of Tenant's creditworthiness and the character of its occupancy
and use of the Premises would be compatible with the nature of the Premises and
other adjacent properties and tenants of Landlord. Therefore, if Tenant, as
debtor, or its trustee elects to assume this Lease, in addition to complying
with all other requirements for assumption under the Federal Bankruptcy Code,
then Tenant, as debtor, or its trustee or assignee, as the case may be, must
also provide the adequate assurance of future performance, including but not
limited to a deposit, the amount of which shall be reasonably determined based
on the duration of time remaining in the Term, the physical condition of the
Premises at the time the proceeding was filed, and such damages as may be
reasonably anticipated after reinstatement of the Lease.

21.03   Re-Leasing of Premises:  In the event of declaration of forfeiture
        ----------------------
at or after the time of re-entry, Landlord may re-lease the Premises or any 
portion(s) of the Premises for a term or terms and at a rent which may be less 
than or exceed the balance of the term of and the rent reserved under this 
Lease.  In such event Tenant will pay Landlord as liquidated damages for 
Tenant's default any deficiency between the total rent reserved and the net 
amount, if any, of the rents collected on account of the lease or leases of the 
Premises which otherwise would have constituted the balance of the term of this 
Lease.  In computing such liquidated damages, there will be added to the 
deficiency reasonable expenses which Landlord may incur in connection with 
re-leasing, such as legal expenses, attorney's fees, brokerage fees and 
expenses, advertising and for keeping the Premises in good order or for 
preparing the Premises for re-leasing.  Any such liquidated damages will be paid
in monthly installments by Tenant on the Rent Day and any such suit brought to 
collect the deficiency for any month will not prejudice Landlord's right to 
collect the deficiency for any subsequent month by a similar proceeding.  In 
lieu of the foregoing computation of liquidated damages, Landlord may elect, at 
its sole option, to receive

                                     -14-
<PAGE>
 
liquidated damages in one payment equal to any deficiency between the total rent
reserved hereunder and the fair and reasonable rental of the Premises, both 
discounted at five (5%) percent per annum to present value at the time of 
declaration of forfeiture.

21.04   Failure to Re-Lease Premises:  Whether or not forfeiture has been 
        ----------------------------
declared, Landlord will attempt to re-lease the Premises, however, Landlord will
not be responsible in any way for failure to re-lease the Premises, or in the 
event that the Premises are re-leased, for failure to collect the rent under 
such re-leasing.  The failure of Landlord to re-lease all or any part of the 
Premises will not release or affect Tenant's liability for rent or damages.

                                  SECTION 22

                     SURRENDER OF PREMISES ON TERMINATION

22.01   Condition of Premises Upon Termination:  At the expiration (or earlier
        --------------------------------------
termination) of the Term, Tenant will surrender the Premises broom clean and in
as good condition and repair as they were at the time Tenant took possession,
reasonable wear and tear excepted, and promptly upon surrender will deliver all
keys and building security cards for the Premises to Landlord at the place then
fixed for payment of rent. All reasonable costs and expenses incurred by
Landlord in connection with repairing or restoring the Premises to the condition
called for herein, together with the costs, if any, of removing from the
Premises any property of Tenant left therein, together with liquidated damages
in an amount equal to the amount of minimum net rental plus all other charges
which would have been payable by Tenant under this Lease if the term of this
Lease had been extended for the period of time reasonably required for Landlord
to repair or restore the Premises to the condition called for herein, shall be
invoiced to Tenant and shall be payable within ten (10) days of the date of such
invoice.

22.02   Storage of Tenant's Property:  If Tenant fails to remove all its 
        ----------------------------
property (or property of others in its possession) from the Premises on 
termination of this Lease (for any cause), Landlord at its option may remove the
property in any manner that it chooses and may store the property without 
liability to Tenant for loss, whether based on contract, tort or otherwise.  
Tenant agrees to pay Landlord on demand any and all expenses incurred in such 
removal, including court costs, attorneys' fees and storage charges on the
property for any length of time it is in Landlord's possession. Tenant will
indemnify and hold Landlord harmless from any claim by third parties with
respect to property owned or claimed by them, left in the Premises by Tenant,
and removed by Landlord pursuant to this paragraph. Under no circumstances will
Landlord be obligated to retain any property left on the Premises or in
Landlord's possession longer than two (2) months after termination of this Lease
(for any cause) and Landlord may after two (2) months dispose of the property in
any manner it deems appropriate, including public or private sale or by
destruction, discard or abandonment and the proceeds of any such sale will be
applied against any sums due Landlord under this Lease.

                                  SECTION 23

              PERFORMANCE BY LANDLORD OF THE COVENANTS OF TENANT

23.01   Tenant's Failure to Perform:  If Tenant fails to pay any sum of money, 
        ----------------------------
other than rental, required to be paid hereunder or fails to perform any act on 
its part to be performed hereunder and such failure shall continue for a period 
of ten (10) days (or a reasonable period of less than ten (10) days when life, 
person or property is in jeopardy), Landlord may (but shall

                                      -15-

<PAGE>
 
not be required to), and without waiving or releasing Tenant from any of 
Tenant's obligations, make any such payment or perform any such other act.  All 
sums paid by Landlord and all reasonable incidental costs, including without 
limitation the cost of repair, maintenance or restoration of the Premises if so 
performed by Landlord hereunder, shall be deemed additional rental and, together
with interest thereon at the rate set forth in Section 5.02 from the date of 
payment by Landlord until the date of repayment by Tenant to Landlord, shall be 
payable to Landlord within fifteen (15) days after receipt of invoice by Tenant.
On default in such payment, Landlord shall have the same remedies as on default
in payment of rent.  The rights and remedies granted to Landlord under this 
Section 23 shall be in addition to and not in lieu of all other remedies, if 
any, available to Landlord under this Lease or otherwise, and nothing herein 
contained shall be construed to limit such other remedies of Landlord with 
respect to any matters covered herein.

                                  SECTION 24

                     SUBORDINATION; ESTOPPEL CERTIFICATES

24.01   Subordination:  Tenant agrees, that at Landlord's option, this Lease may
        -------------
be either subordinate or paramount to any construction loans, mortgages, trust 
deeds and ground or underlying leases now or hereafter affecting the Premises 
and to any and all advances to be made thereunder, and to the interest and 
charge thereon, and all renewals, replacements and extensions thereon, provided 
the mortgagee, lessor or trustee named in any such mortgages, trust deeds or 
leases agrees to recognize the lease of Tenant in the event of foreclosure or 
other enforcement of such instruments (and, if requested by Tenant, shall enter 
into a non-disturbance agreement with Tenant) if Tenant is not in default.  
This section shall be self-operative and no further instrument shall be 
required.  However, Tenant will execute promptly any instrument or certificate 
that Landlord may reasonably request confirm such subordination or superior 
status, subject to Tenant's receipt of a non-disturbance agreement, if so 
requested, and hereby irrevocably appoints Landlord as Tenant's attorney-in-fact
to execute such instrument or certificate on its behalf.

                                  SECTION 25

                                SUBSTITUTE SPACE


                                  SECTION 26

                                     -16-
<PAGE>
 
                                QUIET ENJOYMENT

26.01   Quiet Enjoyment:  Landlord agrees that at all times when Tenant
        ---------------
is not in default under the provisions and during the Term of this Lease, 
Tenant's quiet and peaceable enjoyment of the Premises will not be disturbed or 
interfered with by Landlord or any person claiming by, through, or under 
Landlord.

                                  SECTION 27

                                 HOLDING OVER

27.01   Holding Over:  If Tenant remains in possession of the Premises after 
        ------------
expiration of this Lease without executing a new lease, it will be deemed to be 
occupying the Premises as a tenant from month-to-month, subject to all the 
provisions of this Lease to the extent that they can be applicable to a 
month-to-month tenancy, except that the minimum rental for each month will be 
one hundred percent (100%) of the Base Monthly Rental.

                                  SECTION 28

                        REMEDIES NOT EXCLUSIVE; WAIVER

28.01   Remedies:  Each and every of the rights, remedies and benefits provided
        ---------
by this Lease are cumulative and are not exclusive of any other of said rights, 
remedies and benefits, or of any other rights, remedies and benefits allowed by 
law.

28.02   Waiver of Covenant:  One or more waivers of any covenant or condition by
        ------------------
Landlord will not be construed as a waiver of a further or subsequent breach of 
the same covenant or condition, and the consent or approval by Landlord to or of
any act by Tenant requiring Landlord's consent or approval will not be deemed to
waive or render unnecessary Landlord's consent to or approval of any subsequent 
similar act by Tenant.

                                    SECTION 29

                             WAIVER OF SUBROGATION

29.01   Waiver of Subrogation:  Landlord and Tenant shall obtain permission
        ---------------------
from each insurer to, and to the extent so permitted, hereby waive any and all 
right of recovery against each other for any loss or damage caused by fire or 
any of the risks covered by standard fire and extended coverage, vandalism and 
malicious mischief insurance policies.

                                  SECTION 30

                                INDEMNIFICATION

30.01   Indemnification:  Tenant at its expense will defend, indemnify and save
        ---------------
Landlord and its licensees, servants, agents, employees and contractors, 
harmless from any claim or condition of the Premises, the use or misuse thereof 
by Tenant or any other person, the acts or omissions of Tenant, its clients, 
customers, invitees, licensees, servants, agents, employees or contractors, the 
failure of Tenant to comply with any provision of this Lease, or any other event
occurring on the Premises, whatever the cause; provided, however, that nothing 
herein shall be construed to require Tenant to indemnify Landlord or its 
licensees, servants, agents, employees, and contractors against Landlord's or 
its licensees' servants' agents', employees' and contractors' own acts, 
omissions or neglect.

                                  SECTION 31

                                     -17-
<PAGE>
 
                            ASSIGNMENT BY LANDLORD

31.01   Assignment by Landlord: The term "Landlord" as used in this Lease so 
        ----------------------
far as covenants, agreements, stipulations or obligations on the part of the 
Landlord are concerned is limited to mean and include only the owner or owners 
of fee title (or of a ground leasehold interest or land contract vendee's 
interest) to the Premises at the time in question, and in the event of any 
transfer or transfers of the title to such fee the Landlord herein named (and 
in case of any subsequent transfers or conveyances the then grantor) will 
automatically be freed and relieved from and after the date of such transfer or 
conveyance of all liability for the performance of any covenants or obligations 
on the part of the Landlord contained in this Lease thereafter to be performed.

31.02   Landlord's Default:  If Landlord fails to perform any provision of this 
        ------------------
Lease upon Landlord's part to be performed, and if as a consequence of such
default Tenant recovers a money judgment against Landlord, such judgment may be
satisfied only out of the proceeds of sale received upon execution of such
judgment and levied thereon against the right, title and interest of Landlord in
the Premises and out of rents or other income from such property receivable by
Landlord and Landlord shall not be personally liable for any deficiency.


                                  SECTION 32

                               SECURITY DEPOSIT

32.01   Security Deposit:  Landlord hereby acknowledges the receipt of the 
        ----------------
Security Deposit. If Tenant defaults in any of the provisions of this Lease, 
Landlord may use, apply or retain all or any part of the Security Deposit for 
the payment of rents and/or other charges which are the obligation of Tenant 
under this Lease in default or for any other sum which Landlord may expend by 
reasons of Tenant's default, including any damages or deficiency in the 
releasing of the Premises. If Tenant fully complies with all the provisions of 
this Lease, the Security Deposit, or balance thereof, will be returned to Tenant
without interest after (i) the termination of this Lease, (ii) the removal of 
Tenant, and (iii) the surrender of possession of the Premises to Landlord. 
Unless Landlord is shown evidence satisfactory to it that the right to receive 
the Security Deposit has been assigned, Landlord may return the Security Deposit
to the original Tenant regardless of one or more assignments of the Lease 
itself.

                                  SECTION 33

                         MOVEMENT OF TENANT'S PROPERTY

33.01   Moving Tenant's Property:  All activities of Tenant in connection with
        ------------------------
(a) Tenant's move into the Premises at the commencement of this Lease, (b) the
movement of equipment, furniture or other bulky items into, out of or within the
Premises during the Term, or (c) Tenant's move out of the Premises at any time
(whether or not on the termination of this Lease) will be subject to the
following:

          A.   Designated Access.  All furniture, equipment and all other
               -----------------
          items of personal property being moved or transferred will enter and
          leave the Building solely through and by way of such area or entrance
          as may be designated from time to time by Landlord for such purposes;

          B.   Tenant Responsible.  Tenant will be responsible for the active
               ------------------
          supervision (on-site) of all workmen and others

                                     -18-
<PAGE>
 
        performing the move, and will indemnify and hold harmless Landlord
        against and from all liability for damage to property (whether belonging
        to landlord, other tenants or any other person) and injuries to persons
        in connection with the move and the actions, or failure to act, or by
        those performing the move;

        C.  Damage.  Tenant will be responsible for any damage to the Building,
            ------
        the Common Areas, the Premises, or the premises and property of other
        tenants, caused by or incurred in connection with the move or the
        activities connected therewith. Landlord will perform such inspection(s)
        as Landlord in its sole discretion determines to be appropriate, and
        will invoice Tenant for the costs of repair of all such damage or the
        replacement, if necessary, of damaged items. All determinations of the
        extent of damage and the costs of repair or replacement will be made by
        Landlord in the exercise of its reasonable discretion. The invoiced sums
        will constitute amounts included within and payable under Section 12,
        above.

                                  SECTION 34

    NON-TERMINABILITY, COMPLIANCE WITH LAWS, COSTS, SEVERABILITY

34.01 Non-Terminability: Except as otherwise specifically provided in
      -----------------
this Lease, this Lease shall neither terminate nor shall Tenant have
any right to terminate this Lease or to be released, relieved or
discharged from any obligations or liabilities hereunder for any
reason whatsoever, including, without limitation:

        A.  Damage.  Any damage to, or destruction of, the Premises or any
            ------
        portion thereof.

        B.  Condemnation.  Any condemnation, confiscation, requisition or
            ------------ 
        other taking or sale of the possession, use, occupancy or title to
        the Premises or any portion thereof;

        C.  Omission.  Any action, omission or breach on the part of Landlord
            --------
        under this Lease or under any other agreement at the time existing
        between Landlord and Tenant.

        D.  Other Claims.  Any claim as a result of any other business
            ------------
        dealings of Landlord and Tenant.

        E.  Impossibility.  The impossibility or illegality of performance by
            -------------
        Landlord or Tenant or both.

        F.  Force Majuere.  Force majuere.
            -------------
               
        G.  Governmental Action. Any action or threatened or pending action
            -------------------
        of any court, administrative agency or other governmental authority.

Except as otherwise specifically provided in this Lease, Tenant shall remain
obligated under this Lease in accordance with its terms, and will not take any
action to terminate, rescind or avoid this Lease for any reason, notwithstanding
any bankruptcy, insolvency, reorganization, composition, readjustment,
liquidation, dissolution or other proceeding affecting Landlord or any assignee
of Landlord or any action with respect to this Lease which may be taken by any 
receiver, trustee or liquidator (or other similar official) or by any court. All
payments by Tenant hereunder shall be final and Tenant will not seek to recover
any such payment or any part thereof for any reason. Tenant waives all rights
now or hereafter conferred by statute or otherwise to

                                     -19-
<PAGE>
 
quit, terminated or surrender this Lease, or to any abatement, suspension, 
deferment, diminution or reduction of rent, additional rent or other amounts 
payable by Tenant hereunder, or for damage, loss, cost or expense suffered by 
Tenant, on account of any of the reasons referred to herein or otherwise.

                                  SECTION 35

                               ENTIRE AGREEMENT

35.01   Entire Agreement:  This Lease and the Riders attached hereto and forming
        ----------------
a part hereof, set forth all of the covenants, agreements, stipulations,
promises, conditions and understandings between Landlord and Tenant concerning
the Premises and there are no covenants, agreements, stipulations, promises,
conditions or understandings, either oral or written, between them concerning
the Premises other than herein set forth.


                                  SECTION 36

                                   RECORDING

36.01   Recording:  This Lease shall not be recorded by Tenant nor shall Tenant 
        ---------
file or record a memorandum of lease or affidavit of claim with respect to this 
Lease or the Premises. At Landlord's option, Landlord may record this Lease. 
Upon Landlord's request, Tenant shall execute and deliver to Landlord a 
memorandum of lease or affidavit of claim for recording by Landlord.

                                  SECTION 37

                                    GENERAL

37.01   General Terms:  Many references in this Lease to persons, entities and 
        -------------
items have been generalized for ease of reading. Therefore, reference to a 
single person, entity or item will also mean more than one person, entity or 
thing whenever such usage is appropriate. Similarly, pronouns of any gender 
should be considered interchangeable with pronouns of other genders.

37.02   Joint and Several:  All agreements and obligations of Tenant and 
        -----------------
Landlord under this Lease are joint and several in nature.

37.03   Captions:  Captions to sections and paragraphs are provided solely for 
        --------
the sake of convenience and shall have no substantive effect whatsoever.

37.04   Amendments:  This lease can be modified or amended only by a written 
        ----------
agreement signed by Landlord and Tenant.

37.05   Binding Lease:  All provisions of this Lease are and will be binding on 
        -------------
the heirs, executors, administrators, personal representatives successors and 
assigns of Landlord and Tenant.


                                     -20-
<PAGE>
 
37.06   Governing Law:  The laws of the State of Michigan will control in the 
        -------------
construction and enforcement of this Lease.

        IN WITNESS WHEREOF, the parties hereto have executed this Lease as of 
the day and year first above written.

WITNESSES:                                 DOMINO'S FARMS HOLDING
                                           LIMITED PARTNERSHIP
                                           (a Michigan Corporation)

/s/ MARGARET T. PARKINSON                  By: /s/ 
-------------------------                  ----------------------------

                                           Its: SENIOR VICE PRESIDENT
                                                -----------------------
                                           For: Landlord


                                           AASTROM BIOSCIENCES, INC.

/s/ PATRICIA A. POWELL                     By: /s/ R. DOUGLAS ARMSTRONG
-------------------------                     -------------------------

                                           Its: President/CEO
                                                -----------------------
                                           For:  Tenant





                                     -21-
<PAGE>
 
                                   RIDER A-1

                                  FLOOR PLAN

<PAGE>
 
                                   RIDER A-2

                                LAYOUT OF SPACE


<PAGE>
 
                                   RIDER A-3

                                   SITE PLAN

<PAGE>
 
                                    RIDER B

                                WORK AGREEMENT
                                --------------

        The terms and conditions of this Work Agreement shall govern Landlord
and Tenant's participation in the design, construction and installation of
improvements to the Premises in accordance with the Final Plans (as defined
below) and the terms hereof (the "Work"). Tenant acknowledges that it has had an
opportunity to inspect the Premises prior to the execution and delivery of this
Work Agreement. Tenant further acknowledges and agrees that all construction or
improvements to the Premises to the completed at Landlord's expense have been
completed and are accepted by Tenant in an "As Is" condition except for work to
be performed by Landlord pursuant to the Work Agreement. All additional
improvements to the Premises and services incidental or related thereto are
referred to as "Work" and shall be paid for by Landlord and Tenant as set forth
herein.

A.      PRE-LEASE WORK
        --------------

        1.  Preliminary Drawings. Landlord and Tenant acknowledge that they have
            --------------------
            agreed on preliminary drawings prepared by H. Scott Diels,
            Architect, at Tenant's direction and containing general design and
            technical information for the Work to be performed on the Premises
            (the "Preliminary Drawings"), copies of which are attached to this
            Lease as Rider A-2, May 4, 1992. The Preliminary Drawings have been
            or will be submitted to the Architect and Engineer for preparation
            of the Formal Drawings (as defined below).

        2.  Contractor. Landlord and Tenant acknowledge that the Contractor will
            ----------
            be selected with the approval of Tenant and Landlord.

        3.  Transition of Administration. Tenant shall inform the Architect,
            ----------------------------
            Engineer and Contractor that Landlord will assume responsibility for
            administration and coordination of the Work after execution of the
            Lease and that Landlord will be, and perform the obligations of the
            "Owner" under the Architect Agreement, the Engineer Agreement and
            the Construction Agreement. Tenant shall cooperate with Landlord and
            assist in the transition of responsibility for administration and
            coordination of the Work. Landlord and Tenant agree that all
            communications with, and instructions or directions to, the
            Architect, Engineer and Contractor after transition of the Work to
            the Landlord will go through Landlord.

B.      PROJECT REPRESENTATIVES/FIELD CHANGE ORDERS
        -------------------------------------------
         
        1.  Landlord's Representative. Landlord's representative in connection
            -------------------------
            with administration of the Work shall be Larry McGonigal unless
            otherwise directed in writing by Landlord ("Landlord's
            Representative"). All instructions, requests, or directives from
            Tenant to the Landlord, Architect, Engineer or Contractor in
            connection with the construction of the Work will be given or
            communicated to Landlord's Representative who will in turn contact
            or notify the appropriate party.

        2.  Tenant's Representative. Tenant's representative in connection with
            -----------------------
            the Work shall be R. Douglas Armstrong unless otherwise directed in
            writing by Tenant ("Tenant's Representative"). All requests,
            notification, directives, inquiries or information intended for
            Tenant shall be given or communicated by Landlord or Landlord's
            Representative to Tenant's Representative. Tenant's Representative
            shall have access to the Work at all reasonable times for the
            purpose of making inspections, taking measurements and observing the
            Work and may inspect, copy, and discuss with Landlord's
            Representative or other appropriate personnel of Landlord from time
            to time the Work and all invoices and documentation in connection
            with the Work, Tenant's Representative shall be requested to attend
            all regularly scheduled progress meetings related to the Work.

        3.  Field Change Orders. Tenant's Representative shall have the right to
            -------------------
            request Field Change Orders in writing. For purposes of this
            section, "Field Change Orders" shall mean: (a) a "Change Order" or
            "Field Work Order" (as defined in the Contractor Agreement) or
            similar request for changes or modifications in the Work; or (b)
            revisions to the Final Plans or other work-related documents or
            materials requested by Tenant.

        4.  Approval of Field Change Orders. All Field Change Orders shall be
            -------------------------------
            approved in writing by both Landlord and Tenant and shall be
            acceptable to

<PAGE>
 
             Landlord and Tenant in all respects. The cost of any Field Change
             Order shall be an additional Work Cost. Tenant's Representative
             shall approve all Field Change Orders, changes or modifications to
             the Final Plans and any design changes to the Work. Tenant's
             Representative, on behalf of Tenant, and Landlord's Representative,
             on behalf of Landlord, will promptly respond to any requests or
             inquiries of Landlord or Tenant, as the case may be, including
             those relating to Field Change Orders, so as not to interfere with
             the orderly progress of the Work. Landlord shall have the right to
             reject any Field Change Order requested by Tenant which,
             individually or in the aggregate, would delay the Commencement Date
             of the term of this Lease in excess of fourteen (14) days, unless
             in conjunction therewith, Tenant agrees to pay rental for the
             Premises as of the date the Commencement Date would have occurred
             but for the completion of the Field Change Order. The Landlord's
             and Tenant's reasonable judgement as to whether delay may ensue as
             a result of Tenant requested Field Change Orders shall be
             conclusive.

          5. Other Tenant Employee's. Officers, employees or agents of Tenant
             -----------------------
             other than Tenant's Representatives shall have access to the Work
             provided that Tenant notifies Landlord's Representative in advance
             and Tenant's Representative or his designee in writing accompanies
             such parties during such access. Landlord may deny access to such
             parties excluding Tenant's Representative (but access by Tenant's
             Representative shall nevertheless be subject to the delay
             provisions in Section 3.03 of the Lease) in the event that their
             presence materially hampers, interferes with or prevents Landlord,
             Architect, Engineer or Contractor from proceeding with the
             completion of the Work. Any entry on the Premises by Tenant's
             Representative and other officers, agents, employees,
             representatives, licensees or invitees of Tenant shall be at their
             sole risk. Tenant hereby agrees to indemnify, defend and hold
             Landlord harmless from and against any loss, expense, claim,
             demand, action or proceeding arising out of or relating to such
             access to the Premises other than such losses, expenses, claims,
             demands, actions, proceedings caused by the negligence, gross
             negligence or willful misconduct of Landlord or its directors,
             officers, employees, agents, servants, representatives, invitees or
             licensees other than any party performing services under the
             Contractor Agreement, Architect Agreement or Engineer Agreement.

          6. Consultation/Cooperation. Landlord shall advise Tenant of, and
             ------------------------
             consult with Tenant regarding, all material matters relating to the
             Work, including, without limitation, the design, construction and
             engineering of the Work, as well as the services performed or to be
             performed by the Architect, Engineer and Contractor. Tenant shall
             reasonably cooperate with Landlord with respect to such
             consultations and shall not act or fail to act in a manner which
             will delay the design or construction of the Work. Landlord agrees
             to use reasonable efforts to cause Architect, Engineer, Contractor
             and all other persons working on or in connection with the Work to
             perform and comply with terms of this Agreement and any other
             applicable agreement (including, without limitation, pursuing any
             applicable legal recourse against such persons). If any one or more
             Architect, Engineer or Contractor breach their respective contracts
             with Landlord described herein, Landlord may, but shall not be
             obligated to, commence civil proceedings to obtain specific
             enforcement of such breached contract and/or for any other remedies
             or damages available to Landlord. In the event of such a breach and
             if Landlord fails or refuses to commence such legal proceedings
             against the breaching party for sixty (60) days, Tenant may
             commence civil proceedings, at Tenant's sole expense, for specific
             enforcement of the breached contract or any other remedies or
             damages available to Tenant, and to the extent necessary to permit
             and prosecute such proceedings Landlord will assign its rights
             under the breached contract or contracts to Tenant and reasonably
             cooperate with Tenant in connection therewith.

C. RETENTION OF ARCHITECT, ENGINEER AND CONTRACTOR
   -----------------------------------------------

          1. Retention of Architect
             ----------------------

             (a) Architect Agreement. Landlord shall retain the Architect to
                 -------------------
                 prepare formal design drawings and working drawings and
                 specifications (collectively the "Formal Drawings"). The Formal
                 Drawings shall contain design, technical and engineering
                 specifications for the Work based on the Preliminary Drawings.
                 Landlord shall negotiate and execute, as Owner, the written
                 agreement with the Architect governing Architect's
                 participation in the Work (the "Architect Agreement"). All
                 Preliminary Services performed by the Architect shall be
                 included in and made a part of and subject to the terms and
                 conditions of the Architect Agreement. Landlord shall provide,
                 upon request, Tenant with a copy of the proposed Architect
                 Agreement and

<PAGE>
 
                         shall consult with, and include reasonable suggestions
                         of, Tenant with respect to the terms and conditions of
                         the Architect Agreement prior to execution thereof.
                         Landlord shall be, and perform the obligations of, the
                         Owner under the Architect Agreement.

                     (b) Formal Design and Working Drawings. Landlord shall
                         ----------------------------------
                         submit the Preliminary Drawing to the Architect for
                         preparation of the Formal Drawings. Landlord and Tenant
                         shall each have a period of seven (7) days after
                         receipt of the Formal Drawings to 1) approve such
                         drawings in writing, or 2) send written notice to the
                         other party describing any objections to the Formal
                         Drawings. In the event either Landlord or Tenant sends
                         a notice of objections to the formal Drawings, Landlord
                         and Tenant will meet within seven (7) days after such
                         notice is sent to discuss and resolve those matters
                         objectionable to Landlord or Tenant. Either Landlord or
                         Tenant may request the presence of the Architect at
                         such meeting. Landlord and Tenant agree to use their
                         good faith efforts in negotiating and preparing revised
                         Formal Drawings, but the Formal Drawings must be
                         acceptable to both Landlord and Tenant in all respects.
                         The Architect shall revise the Formal Drawings in
                         accordance with those modifications which are approved
                         by Landlord and Tenant at such meeting. The revised
                         Formal Drawings shall reflect the agreed to
                         modifications and shall be given to Tenant and Landlord
                         for final approval. Tenant and Landlord shall give
                         final approval of the Formal Drawings in writing within
                         seven (7) days after receipt of satisfactory Formal
                         Drawings which reflect the agreed to modifications (the
                         Formal Drawings, once so approved, are referred to as
                         "Final Plans").

                     (c) Landlord's Insurer. The Final Plans, once completed,
                         ------------------
                         shall be sent to Factory Mutual Insurance Company, the
                         Landlord's Insurer, ("Insurer") for review and
                         approval. In the event that Insurer has any objections
                         to the Final Plans, such Final Plans shall be revised
                         by the Architect, as expeditiously as possible, in a
                         manner satisfactory to Insurer, Landlord and Tenant.

                     (d) Cost of Architectural Services. Landlord and Tenant
                         ------------------------------
                         acknowledge that Architect has agreed to perform the
                         services under the Architectual Agreement. Landlord
                         shall not agree to any increase in fees or authorize
                         any additional services other than those set forth in
                         the Architect Agreement, or any change to the Final
                         Plans, without the prior written consent of Tenant or
                         Tenant's Representative.



                  2. Retention of Engineer
                     ---------------------
                     (a) Engineer Agreement. Landlord shall retain the Engineer
                         ------------------
                         to prepare designs and specifications with respect to
                         mechanical engineering and technical aspects of the
                         Formal Drawings, the Final Plans and the Work and to
                         the connection and interfacing of the Work with
                         existing systems or equipment of Landlord (the
                         "Engineering Report"). Landlord shall negotiate and
                         execute, as Owner, the written agreement with the
                         Engineer governing the Engineer's participation in the
                         Work (the "Engineer Agreement"). All Preliminary
                         Services and the cost of all Preliminary Services
                         performed by the Engineer shall be included in and be
                         made a part hereof and subject to the terms and
                         conditions of the Engineer Agreement. Landlord shall
                         provide Tenant with a copy of the proposed Engineer
                         Agreement and shall consult with Tenant, and include
                         the reasonable suggestions of, with respect to the
                         terms and conditions of the Engineer Agreement prior to
                         execution thereof. Landlord shall be, and perform the
                         obligations of, the Owner under the Engineer Agreement.

                     (b) Cost of Engineering Services. Landlord and Tenant
                         ----------------------------
                         acknowledge that Engineer has agreed to perform the
                         service under the Engineer Agreement. Landlord shall
                         not agree to any increase in fees or authorize any
                         additional services other than those set forth in the
                         Engineer Agreement, or any change to the Engineering
                         Report, without the prior written consent of Tenant or
                         Tenant's Representative.

                  3. Retention of Contractor
                     -----------------------

                     (a) Contractor Agreement. Landlord shall retain the
                         --------------------
                         services of the Contractor to construct the Work
                         according to the Final Plans. Landlord shall negotiate
                         and execute as Owner, the written agreement with the
                         Contractor governing construction of the Work
<PAGE>
 
                       according to the Final Plans (the "Contractor
                       Agreement"). Landlord shall provide Tenant with a copy of
                       the proposed Contractor Agreement and shall consult with
                       Tenant with respect to the terms and conditions of the
                       Contractor Agreement prior to execution thereof. Landlord
                       shall be, and perform the obligations of, the Owner under
                       the Contractor Agreement. The Contractor Agreement shall
                       include a completion date satisfactory to Tenant (which
                       date shall not be changed or modified except by an
                       amendment to the Contractor Agreement with prior written
                       consent of both landlord and Tenant). Landlord shall not
                       have any liability whatsoever to Tenant for any cost,
                       expense, lost profits, damage or other liability suffered
                       or incurred by Tenant by reason of the Contractor's
                       failure to complete the Work on or before the completion
                       date contained in the Contractor Agreement. Landlord
                       shall use its reasonable best efforts to cause the
                       Contractor to complete the Work on or before the
                       Completion Date contained in the Contractor Agreement,
                       and in any event as soon as possible.

                   (b) Cost of Construction. Landlord and Tenant acknowledge
                       --------------------
                       that Contractor has agreed to perform the services under
                       the Contractor Agreement. Landlord shall not agree to any
                       increase in fees, or authorize any additional services
                       other than those set forth in the Contractor Agreement,
                       or any Field Change Orders, without the prior written
                       consent of Tenant or Tenant's Representative.

                4. Responsibility for Contents of Plans and Drawings.
                   -------------------------------------------------
                   Notwithstanding anything herein to the contrary, Landlord
                   shall not be responsible for the accuracy, efficacy or
                   sufficiency of any drawings, plans or specifications to be
                   provided by any person herein (including without limitation,
                   those plans, drawings or specifications to be furnished by
                   Tenant, the Engineer or the Architect) except (i) those
                   portions of the plans, drawings, and specification provided
                   by Landlord and (ii) Landlord agrees that the Work as
                   described in the Final Plans and any Field Change Orders is
                   sufficient for Landlord's purposes and will meet Landlord's
                   needs and requirements for improvements to the Building. The
                   Architect, Engineer and/or Contractor shall be otherwise
                   responsible for all plans, drawings and specifications
                   including, without limitation, the Final Plans and any Field
                   Change Orders, all technical and other examination of the
                   Premises and shall be exclusively responsible with respect to
                   verification of actual field conditions and actual field
                   measurements and a full review of all technical and
                   engineering requirements with respect to the Premises and
                   Work to be performed hereunder. In addition, Tenant shall be
                   exclusively responsible for determining whether the plans,
                   specifications and drawings including, without limitation,
                   the Final Plans and any Field Change Orders and the systems
                   and equipment described therein, meet the needs of the
                   Tenant.

                5. Compliance. Landlord will insure that the Final Plans and all
                   ----------
                   Work shall comply with and conform to the Building plans and
                   with all the rules, regulations and other requirements of any
                   governmental department or agency having jurisdiction over
                   the construction of the Work. Landlord, Architect or
                   Contractor shall file all necessary architectural plans,
                   together with any mechanical plans and specifications, and
                   any and all other filings necessary to complete the Work in
                   such form as may be necessary, with the appropriate
                   governmental and other agencies and obtain those governmental
                   and other approvals or consents necessary to authorize
                   completion of the Work, including required permits and zoning
                   approvals. Any changes required by any governmental or other
                   agency affecting the construction of the Premises shall be
                   complied with by Landlord in completing the Work at Tenant's
                   expense and shall not be deemed to be a violation of the
                   Final Plans or any provisions of this Work Agreement, and
                   shall be deemed automatically accepted and approved by
                   Tenant. Landlord shall cause the Work to be constructed and
                   completed in accordance with the prevailing and customary
                   construction standards in accordance with the Final Drawings
                   and all applicable laws, rules, regulations, ordinances and
                   codes and shall ensure that safety standards acceptable in
                   the industry are employed. Landlord shall maintain
                   appropriate insurance with respect to the work. Tenant shall
                   reasonably cooperate with the Owner in complying with the
                   foregoing requirements and Owner shall keep Tenant advised of
                   the progress in connection with such requirements.

             D. WORK COST
                ---------

                1. Work Cost. "Work Cost" shall mean contracted amount with
                   ---------
                   architect, engineer and contractor, except as adjusted by
                   Field Change Orders, and all the following:

<PAGE>
 
                    (a) All filing fees and permit costs incurred in connection
                        with the Work to the extent not included in contracts
                        above, and Landlord shall provide receipts for payment
                        of the same upon Tenant's request.

                    (b) Legal fees, as mutually agreed upon in writing, in
                        connection with obtaining governmental approvals of the
                        Work and Tenant's uses of the Premises.

                    (c) Litigation costs in connection with the Work Agreement
                        as mutually agreed upon in writing.

                    (d) All other costs of the Work mutually agreed upon in
                        writing.

           E. PAYMENT OF WORK COST
              --------------------

              Tenant shall pay the Work Cost in the following manner:

              1. Payment of Work Cost
                 --------------------

                    (a) Payment - General. Tenant will make a deposit to the
                        -----------------
                        Landlord based on construction estimates (per Rider D).
                        Landlord will utilize said deposit to pay all
                        construction related invoices.

                    (b) Change Orders. Authorized change orders are to be
                        -------------
                        accompanied with a check from the Tenant to cover said
                        amount.

                    (c) Final Payment. After project is complete and within
                        -------------
                        fifteen (15) days after billing is received by Landlord,
                        a reconciliation will be provided showing total costs.
                        Tenant will provide final check for the total amount of
                        the improvements less any previous payments and the
                        Landlord's contribution when:

                        (1) Tenant, Architect and Landlord shall have inspected
                            the Work and determined that the Work is complete
                            and that all items comprising the Punch List
                            prepared pursuant to Section 3.03 of this Lease
                            shall have been completed or corrected. In the event
                            of any dispute regarding completion, the Architect's
                            determination shall be final;

                        (2) Landlord shall have removed or have caused to be
                            removed, at its expense, from the site of the Work
                            all material, equipment and structures which are not
                            part of the Work and shall have made the site of the
                            Work clean and ready for use; and

                        (3) Landlord shall have caused to be executed and copies
                            delivered to Tenant of lien waivers executed
                            by all persons, firms, and companies who have
                            provided labor or furnished materials in connection
                            with the Work including a general release and
                            specific lien waiver from Contractor both in form
                            and substance reasonably satisfactory to Tenant.

              2. Continuing Obligations. Nothing herein shall be construed to
                 ----------------------
                 relieve Tenant from any liability for unpaid Work Costs due and
                 payable pursuant to the terms of this Work Agreement.

           F. WARRANTIES
              ----------

              Landlord warrants to Tenant that the Work will be performed in a
              workmanlike manner and in accordance with the Final Plans and any
              approved changes or modifications thereto and shall comply with
              all applicable codes, laws, and regulations. Landlord will obtain
              from the Contractor under the terms of the Construction Agreement
              such warranties as the Contractor generally provides in connection
              with its services. Landlord will use reasonable efforts to have
              all such warranties include a provision that they may be assigned
              to Tenant at Landlord's option. Upon the completion of the Work,
              Landlord shall assign to Tenant those warranties and manuals with
              respect to those items described in Rider H to this Lease and such
              other items as Tenant is required to maintain or repair pursuant
              to the terms of this Lease or otherwise, procured by Landlord from
              the Contractor, the Architect, Engineer, or others in connection
              with the performance of the Work or and any material or equipment
              installed upon the Premises as part of the Work. Landlord shall
              retain all other warranties and manuals. If such warranties are
              not assignable, Landlord shall pursue and, if possible, obtain
              coverage as requested by Tenant for and on behalf of Tenant, under
              such warranties (at Tenant's cost and expense). LANDLORD HEREBY
              DISCLAIMS ANY AND ALL OTHER
<PAGE>
 
    WARRANTIES OF ANY KIND IN CONNECTION WITH THE WORK INCLUDING WARRANTIES
    OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

G.  INDEMNIFICATION BY TENANT
    -------------------------

    To the fullest extent permitted by law, Tenant agrees to defend,
    indemnify and hold Landlord, its partners, employees, officers, and agents,
    and their legal successors and assigns (herein the "Landlord Indemnitees"),
    free and harmless of and from any and all liability, damages, all losses,
    costs and expenses, including, without limitation, all Work Cost and
    attorney fees, (collectively "Losses") incurred, suffered or required to
    be paid by Landlord Indemnitees to the extent that such losses result from
    or are attributable to (a) Tenant's failure to pay the Work Cost due and
    payable pursuant to this Work Agreement or (b) Landlord's Indemnitees'
    reliance on orders, instructions, directives or requests of Tenant in 
    connection with the construction of the Work and the preparation of the
    Final Plans or (c) any negligent or grossly negligent acts, or omissions
    and/or intentional malfeasance, of Tenant, its employees, agents, guests
    or invitees prior to final completion of the Work, provided however, that
    notwithstanding anything herein to the contrary, the foregoing obligation
    to indemnify, hold harmless and defend shall not apply to any liability,
    damages, losses, costs or expenses attributable to the Landlord's
    Indemnitees.  If any claim is made by a third party against any Landlord
    Indemnitees for which the Landlord Indemnitee seeks indemnification from
    Tenant hereunder, Landlord shall give prompt notice to Tenant who shall 
    have the right at Tenant's sole expense to participate in or control the
    defense of such claim at its own expense and through counsel of its own 
    choice.  If after such notice Tenant does not so participate, Tenant shall
    nevertheless be bound by the results obtained by Landlord insofar as the
    claim against any Landlord Indemnitee is concerned.

H.  INDEMNITY BY LANDLORD
    ---------------------

    Landlord shall defend, indemnify and hold harmless Tenant, its affiliates,
    and any of their respective directors, officers, employees, agents, servants
    and representatives ("Tenant Indemnitees") from and against any and all
    liability, damages, all losses, costs and expenses, including reasonable
    attorney fees, incurred, suffered or required to be paid by Tenant
    Indemnitee, resulting from or caused by or arising out of any action,
    omission or operation (i) under this Agreement or in connection with the
    Work attributable to Landlord, (ii) under the Architect Agreement, the
    Engineer Agreement, the Contractor Agreement or any other construction
    related document attributable to Landlord or the performance of any
    obligation of Landlord under such agreements or documents, or (iii) relating
    to any claim against Tenant arising under the Architect Agreement, the
    Engineer Agreement, the Contractor Agreement or any Work related document
    provided, however, that the foregoing obligation by the Landlord to defend,
    indemnify and hold harmless shall not apply to (x) any liability, damages,
    losses, costs or expenses, attributable to the negligence, gross negligence
    or willful misconduct of any Tenant Indemnitee, (y) the breach of any
    obligation of Tenant hereunder or (z) those matters for which Tenant is
    obligated to indemnify Landlord pursuant to Section B(5) of this Work
    Agreement. If any claim is made by a third party against any Tenant
    Indemnitee for which the Tenant Indemnitee seeks indemnification from
    Landlord hereunder, the Tenant Indemnitee shall give prompt notice to
    Landlord who shall have the right, at its sole option, to participate in or
    control the defense of such claim at its own expense and through counsel of
    its own choice. If after such notice Landlord does not so participate,
    Landlord shall nevertheless be bound by the results obtained by Tenant
    Indemnitee insofar as the claim against Tenant Indemnitee is concerned.

I.  OWNERSHIP OF DOCUMENTS, CONFIDENTIALITY
    ---------------------------------------
    Landlord and Tenant shall both be furnished copies of, and own, all
    drawings, specifications, manuals for equipment described on Rider H, design
    analyses, shop drawings, as-built record prints, calculations, renderings
    and any other related documents or materials prepared in connection with the
    Work.

J.  MISCELLANEOUS
    -------------

    1.  Approvals, Notices.  All prints, drawing information and other
        ------------------
        material to be furnished by Tenant to Landlord or by Landlord to
        Tenant for approval as required herein shall be addressed to Landlord
        or Tenant, as the case may be, at the addresses set forth in the 
        Summary of Lease Terms.  Approvals of such documents shall be sent
        in accordance with Section 20 of the Lease relating to notices.

    2.  Relationship.  Landlord and Tenant agree that Landlord is not the
        ------------
        employee or agent of Tenant and with respect to this Work Agreement
        is an independent contractor.  It is expressly agreed that all persons
        engaged in the 

<PAGE>
 
     performance of the Work hired by Landlord or by any contractor of Landlord
     as between Landlord and Tenant shall be conclusively deemed to be employees
     or contractors of Landlord and not Tenant. This Agreement shall not
     constitute Landlord or any contractor as the agent, partner, or legal
     representative of Tenant, and Tenant shall not be responsible in any way
     for any obligations or liability incurred or assumed by Landlord or any
     contractor (the foregoing shall not in any manner limit the liability of
     obligations of Tenant to Landlord hereunder). Landlord shall contract only
     in its own name and only for its own account. Each such contract shall
     expressly state that the contractor recognizes that, to the extent
     permitted by law, it does not have a right to make any claim for payment
     directly from Tenant, since the contract has been made exclusively with
     Landlord and that, upon the request of Landlord, the contractor shall
     provide Landlord with a sworn statement regarding the contractor's right to
     receive payments for work or materials provided to the Work.

 3.  Confidentiality of Work and Plans. Landlord agrees that Landlord will
     ---------------------------------
     maintain the confidentiality of, and not disclose to third persons or
     parties, any of the Final Plans, Field Change Orders or other plans or
     specifications relating the Work except as Landlord may require for the
     construction of the Work, maintenance, operation, financing, insuring, sale
     of other conveyance of the Building or as may be required by any
     governmental authority, department or agency.









<PAGE>
 
                                    RIDER C

                             RULES AND REGULATIONS

    The Landlord, or the Agent of the Landlord, as the case may be, reserves 
the right to make such other further and reasonable rules and regulations as in 
its judgment may from time to time be necessary or desirable for the safety and 
preservation of good order and prestige therein.

    Wherever the word "Tenant" occurs, it is understood and agreed that it
shall mean Tenant's employees, agents, clerks, servants and visitors.  Wherever 
the word "Landlord" occurs, it is understood and agreed that it shall mean 
Landlord's assigns, agents, clerks, servants and visitors.

1.  No sign, picture, lettering, notice or advertisement of any kind shall be
    painted, taped or displayed on or from the windows, doors, roof or
    outside wall of the premises.  Landlord shall have the right to approve
    all signs, exhibits and displays to be made by Tenant in and from common  
    areas of the building.  All of Tenant's interior sign painting or lettering 
    shall be approved by Landlord and the cost thereof shall be paid by Tenant.
    (See footnote #1)

2.  No electric or other wires for any purpose shall be brought into the
    premises without Landlord's written permission specifying the manner in
    which same may be done.  This shall prohibit use of hot plates (cooking) and
    only approved electric percolators or coffee makers shall be permitted.
    No boring, cutting or stringing of wire shall be done without Landlord's 
    prior written consent.  Tenant shall not disturb or in any way interfere
    with the electric light fixtures, and all work upon or alterations to the
    same shall be done by persons authorized by Landlord.

3.  Water closets and other toilet fixtures shall not be used for any purposes
    other than that for which the same is intended, and any damage resulting to
    same from Tenant's misuse shall be paid for by Tenant.  No person shall
    waste water by interfering or tampering with the faucets or otherwise.

4.  No person shall disturb the occupants of this or adjoining buildings or
    premises by the use of radios, television sets, loud speakers, or musical
    instruments, or by making loud or disturbing noises.

5.  No bicycle or other vehicle and no pets shall be allowed in offices, hall, 
    corridors or elsewhere in the building.

6.  No floor load exceeding an average rate of 60 pounds of live load per
    square foot of floor area can be allowed.  Tenant's business machines and
    mechanical equipment which cause vibration or noise that may be transmitted
    to the building structure or to any other leased space in the building shall
    be placed and maintained by Tenant in settings of cork, rubber, spring or
    other types of vibration eliminators sufficient to eliminate such vibration
    or noise.

7.  Any safe, vault, heavy equipment, furniture, or machinery moved in or out
    of the premises shall be moved in such manner and at such times as Landlord
    shall in each instance approve.



May 20, 1991
<PAGE>
 
8.   No additional lock or locks shall be placed on any door in the
     building without Landlord's prior written consent.  Upon the termination
     of this Lease, the Tenant shall surrender to Landlord all keys to the
     premises.

9.   Tenant shall not install or operate any steam or gas engine or boiler
     or carry on any mechanical business on said premises or use oil burning
     fluids, or gasoline for heating or lighting or for any other purpose.
     (See Rider G.)

10.  The premises shall not be used for lodging or sleeping or for any immoral
     or illegal purposes.

11.  Any newspaper, magazine or other advertising done from the said premises
     or referring to the said premises, Domino's Farms or Prairie House, which 
     in the opinion of the Landlord is objectionable, shall be immediately 
     discontinued upon notice from the Landlord.

12.  The sidewalk, entry, passage hall and stairway shall not be obstructed
     or used for any purpose other than those of ingress and egress without
     the express written consent of the Landlord.

13.  Window coverings other than those which may be provided by Landlord, 
     either inside or outside of the windows, may only be installed with the 
     Landlord's prior written consent, and must be furnished, installed and
     maintained at the expense of the Tenant and at Tenant's risk, and must be
     of such shape, color, material, quality and design as may be prescribed by 
     the Landlord.  Tenant shall exercise reasonable care in placing furniture,
     equipment, etc. in such a position as to not obstruct the windows.

14.  Tenant will exercise reasonable discretion with regards to thermostat
     settings within the tenant space.  Acceptable temperatures for heating
     will not exceed 72 degrees or fall below 68 degrees for cooling.

15.  Tenant will be responsible for vending service located within the tenant
     premises.  Landlord will designate approved vending contractors within
     the building.  Tenant will coordinate vending installation with Landlord.

16.  Domino's Farms Prairie House is a smoke free building; smoking of cigars,
     pipes and cigarettes is not allowed inside the building.

17.  Subject to the terms of the Lease between Tenant and Landlord, Landlord
     will provide normal heating, ventilation and air conditioning as
     reasonably required by prevailing weather conditions to the leased
     premises on the following days (except legal holidays):

     Monday - Friday  from 8:00 a.m. to  6:00 p.m.
     Saturday         from 8:00 a.m. to 12:00 p.m.

Footnotes:  #1 - Tenant will be permitted to provide signage for door
                 leading from lobby into tenant space.  Such signage
                 must be reviewed and approved by Landlord.
<PAGE>
 
                                    RIDER D

                               ADDENDUM TO LEASE

TENANT IMPROVEMENT ALLOWANCE
----------------------------

The tenant improvement allowance shall equal $29.25 per square foot.  Any costs 
in excess of this allowance, based upon construction estimates, shall be paid
by the Tenant to the Landlord according to the following payment schedule:

Fifty percent (50%) shall be deposited by Tenant with Landlord prior to 
commencement of work.

Forty percent (40%) shall be paid when the project is approximately fifty 
percent complete, based upon projected project costs.

The remaining ten percent (10%) shall be held until project completion, and 
until a project costs compilation is prepared.  At such time, the ten percent 
plus any overages or minus any amount under budget will be paid to Landlord.

The Landlord shall provide cold water and sanitary to the leased space.  The 
cost of internal routing will be a portion of the tenant build improvements.

OPTION FOR RENEWAL
------------------

The Tenant will have an option to renew the lease for an additional period of up
to five (5) years, at a rate equal to $21.00 per square foot plus an adjustment 
based upon the Consumers Price Index.  Once per year for each year during the 
renewal term, the rate will be adjusted based upon the Consumers Price Index.  
Such increases shall not be less than three (3) percent nor more than seven (7) 
percent in any one year.

If Tenant exercises said option to renew, Landlord may elect to install, at 
Landlord's expense, a meter for electrical service to the Premises.  In such 
event, Tenant will then become responsible for monthly electrical charges based
upon actual meter readings.  In the event Landlord elects not to install a 
meter, then Tenant will be assessed a monthly pro rata share of electrical
charges for Phase 5.

TEMPORARY SPACE
---------------

Landlord will provide temporary office space and associated utility costs to the
Tenant at no charge, upon signing of lease, and until Commencement Date of 
lease.  Said space shall be approximately 1,000 square feet, and location in 
building will be at discretion of Landlord based upon availablility of space.  
Tenant shall be responsible for telephone, furniture, post office box, moving 
charges, and all other associated costs.

<PAGE>
 
AMENITITES
----------
As of the Commencement Date of this Lease, the following amenities were 
available to tenants in the building.  Landlord does not guarantee that all will
be available at all times, and amenities are subject to change at the discretion
of the Landlord.

Ample, free parking                     Travel Agency
24 hour on-site security staff          Fitness center
24 hour access                          Auto rental agency
A variety of restaurants                Dry cleaners
Catering services                       Clothier & tailor
Conference and Meeting Rooms            Sundry shop
Automated teller machine                U.S. Post Office
Hair salon                              Child care facility

<PAGE>
 
                                    RIDER E

                           RIGHT OF REFUSAL - Page 1


    During the Initial Term and Renewal Term, if any, of this Lease, Tenant 
shall have a First Right of Refusal ("Right of Refusal") to lease certain 
additional space in the Building, under the following terms and conditions:

    A.  Space.  Tenant's Right of Refusal shall apply to the approximately
2,306 square feet of rentable space on the second floor of Phase 5 of the 
Building, which is located adjacent to the Premises leased hereunder, and which 
is outlined on the attached floor plan.

    To the greatest extent possible, Landlord will endeavor to locate
alternative space for any leasing prospects interested in approximately 2,300
square feet.

    B.  Exercise by Tenant.  Tenant shall have the right to exercise its Right 
of Refusal in the following manner:  If at any time after the date hereof, the 
space is vacant, and Landlord intends to let such vacant space, as evidenced by 
a written proposal from Landlord (Landlord's Proposal) to a proposed lessee, 
then Landlord shall give Tenant written notice of such intention (Notice of 
Intent to Lease).  Tenant shall have a period of ten (10) business days from the
date of receipt of such Notice of Intent to Lease to exercise its Right of 
Refusal by sending written notice to Landlord of such exercise (which notice 
must be received by Landlord within such ten (10) day period).

    C.  Refusal by Tenant.  If Tenant does not exercise its Right of Refusal as 
to the space covered by a Landlord's Proposal, Landlord shall be free to lease 
the space pursuant to the Landlord's Proposal.

    If Tenant does not exercise its Right of Refusal and the proposed lessee 
does not accept the Landlord's Proposal, Tenant's Right of Refusal with respect 
to such space shall be reinstated as set forth above, including, without 
limitation, the right to exercise its Right of Refusal as to any subsequent 
proposals to lease the space as set forth above.

    D.  Notices.  All notices hereunder shall be sent in compliance with Section
20 of the Lease.

    E.  Same Lease Terms.  Under the exercise of Tenant's Right of Refusal, the 
space affected thereby shall be subject to all of the same terms and conditions 
of this Lease (including, without limitation, the Renewal Option set forth above
and the Expiration Date) except that (i) additional rent with respect to such 
space shall commence ninety (90) days after the exercise of Tenant's Right of 
Refusal relating to such space, or upon taking possession of such space, if 
sooner; and (ii) Base Annual Rent and Base Monthly Rent for the additional space
taken by Tenant shall be at the same rate in effect for the Premises at the time
of exercise of Tenant's Right of Refusal; and (iii) an allowance for Tenant's 
build out of such space shall be given by Landlord at the rate of $28 per square
foot.

<PAGE>
 
                                    RIDER E

                               RIGHT OF REFUSAL




                                     [CRC]
<PAGE>
 
                                    RIDER F

                                  ATTORNMENT
                                  ----------

1.  Attornment.  Tenant covenants and agrees that, if by reason of default
    ----------
    under any mortgage which may now or hereafter affect the Premises,
    including, without limitation, the Mortgage and Security Agreement dated as
    of March 29, 1990, between the owner of the Premises hereunder or a
    successor in title or interest, as Mortgagor, and Kansallis-Osake-Pankki,
    New York Branch, as Mortgagee, and any amendments, supplements or
    modifications thereof (the "Mortgage"), the mortgagee thereunder enters into
    and becomes possessed of the mortgaged property of which the Premises form a
    part either through possession or foreclosure action or proceeding, or in
    the event of the sale of the said action or proceeding, or in the event of
    the sale of the said mortgaged property as a result of any action or
    proceeding to foreclose said mortgage or as a result of a conveyance in lieu
    of foreclosure, the Tenant will attorn to the mortgagee or such then owner
    as its Landlord under this Lease, unless the mortgagee or such then owner
    shall elect to terminate this Lease and the rights of the Tenant hereunder.
    The Tenant agrees to execute and deliver, at any time and from time to time,
    upon the request of the mortgagee or the then owner of the mortgaged
    property, any instrument which may be necessary or appropriate to evidence
    such attornment and the Tenant hereby appoints the mortgagee or the then
    owner of the Premises the attorney-in-fact, irrevocable, of the Tenant to
    execute and deliver for and on behalf of the Tenant any such instrument. The
    Tenant further waives the provision of any statute or rule of law now or
    hereafter in effect which may terminate this Lease or to surrender
    possession of the Premises in the event of foreclosure or any proceeding is
    brought by the mortgagee under any such mortgage to terminate the same, and
    agrees that unless and until the mortgagee, in connection with any such
    proceeding, shall elect to terminate this Lease and the rights of the Tenant
    hereunder, this Lease shall not be affected in any way whatsoever by any
    such proceeding.

2.  Nondisturbance.  Notwithstanding the provisions of Paragraph 1 above:
    --------------
    (a)  The mortgagee or the then owner, as the case may be, shall not disturb
         Tenant's use and possession of the Premises nor terminate the Lease so
         long as Tenant is not in default of the terms of this Lease.

    (b)  In addition, the mortgagee or the then owner, as the case may be, shall
         at all times during Tenant's attornment hereunder, be bound to Tenant  
         as Landlord under all the terms and conditions of this Lease, provided,
         however, that the mortgagee or the then owner, as the case may be,
         shall not be (i) liable for the act or omission of any prior landlord
         under the Lease (including Landlord); (ii) subject to any offsets or
         defenses which Tenant might have against any prior landlord under the
         Lease (including Landlord); (iii) bound by any rent or additional rent
         which Tenant might have paid for more than the current month to any
         prior landlord under the Lease (including Landlord) unless such rent
         or additional rent has been delivered to mortgagee or such then owner;
         (iv) responsible for any security deposit which Tenant may have paid
         to any landlord (including Landlord), unless such deposit has been
         delivered to the mortgagee or such then owner, or (v) bound by any
         modification, amendment, surrender or cancellation of the Lease made
         without the prior written consent of mortgagee or the then owner.

3.  No Release of Landlord.  This Agreement shall not relieve Domino's Farms
    ----------------------
    Holding Limited Partnership of any obligation as Landlord under the Lease.

<PAGE>
 
                                    RIDER G

                              HAZARDOUS MATERIALS
                              -------------------

HAZARDOUS MATERIALS/TENANTS OBLIGATIONS
---------------------------------------

A.  Definitions:  As used in this Section, "Environmental Law" and
    -----------
    "Hazardous Materials" shall have the following meanings:

    1.  "Environmental Law" means any applicable federal, state or local
        ------------------
        government law, rule, ordinance or regulation in effect from time
        to time relating to the environment, pollution, toxic substances,
        Hazardous Materials or solid and/or toxic waste disposal, including,
        without limitation, the following statutes and the regulations
        promulgated thereunder:

        (a)  Michigan Solid Waste Management Act, MCLA Section 299.401 et seq.;
                                                                       ------
        (b)  Michigan Hazardous Waste Management Act, MCLA Section 299.501
             et seq.;
             ------

        (c)  Federal Resource Conservation and Recovery Act of 1976;

        (d)  Federal Comprehensive Environmental Response, Compensation and
             Liability Act of 1980; and

        (e)  Federal Superfund Amendments and Reauthorization Act of 1986.

    2.  "Hazardous Materials" means "Hazardous Waste" or "Hazardous Substance"
        ---------------------
        as those terms are currently defined in the Resource Conservation and
        Recovery Act of 1976, the Comprehensive Environmental Response,
        Compensation Liability Act of 1980 and the Superfund Amendments and
        Reauthorization Act of 1986.

B.  Use of Premises.  Tenant shall not cause or permit the Premises to be used
    ---------------
    to generate, manufacture, refine, transport, treat, store, handle, dispose 
    of, transfer, produce or process Hazardous Materials in violation of any
    Environmental Law.  At all times Tenant shall use and dispose of Hazardous
    Materials in compliance with all applicable Environmental Law and all
    requirements and guidelines of the United States Nuclear Regulatory 
    Commission.  Tenant shall not cause or permit, as a result of any
    intentional or unintentional act or omission on the part of Tenant, a 
    release of Hazardous Materials onto the Premises, the Building or any area
    comprising part of the Domino's Farms Prairie House Office Complex in
    violation of Environmental Law.  Landlord and Tenant will promptly deliver
    to the other copies of all notices received from any federal, state or local
    authority regarding environmental problems affecting the Premises.  The
    provisions hereof shall be in addition to any and all other obligations
    and liabilities Tenant may have to the Landlord at law or in equity 
    regarding Tenant's violation of Environmental Law and shall survive
    termination of this Lease and the satisfaction of all other obligations
    of Tenant hereunder.

C.  Presence of Hazardous Materials/Indemnity.  If Hazardous Materials are
    -----------------------------------------
    present on or under the Premises in amounts, concentrations or in a manner
    in violation of Environmental Law by reason of the acts or omissions of
    Tenant or its agents, representatives, contractors, officers, directors,
    employees, licensees or invitees, Tenant shall: (i) conduct and complete all
    investigations, studies, sampling and testing, and all remedial, removal and
    other actions necessary to clean up and remove all such Hazardous Materials
    on, under, from or affecting the Premises in accordance with all applicable
    Environmental Law; (ii) defend, indemnify and hold harmless Landlord, its
    employees, agents, officers and directors from and against any claims,
    demands, penalties, fines, liabilities, settlements, damages, costs or
    expenses (including attorney's fees) of whatever kind or nature, known or
    unknown, contingent or otherwise, arising out of or in any way related
    to: (A) the presence, disposal, release or threatened release of any such
    Hazardous Materials on, over, under, from or affecting the Premises or the
    soil, water, vegetation, buildings, personal property, persons or animals
    on, in, over or under the Premises; (B) any personal injury (including
    wrongful death) or
    




<PAGE>
 
    property damage (real or personal) arising out of or related to such
    Hazardous Materials; (C) any lawsuit brought or threatened, settlement
    reached or government order relating to such Hazardous Material; and/or (D)
    any violation of laws, orders, regulations, requirements or demands of
    government authorities, or any reasonable policies or requirements of
    Landlord (and in the case Landlord's requirements of which Tenant was
    provided prior written notice), which are based upon or in any way related
    to such Hazardous Materials, including, without limitation, reasonable
    attorney's and reasonable consultant's fees, investigation and laboratory
    fees, court costs and out-of-pocket litigation expenses. In no event shall
    Tenant have any liability for: (i) conditions not in existence on the day
    Landlord, its successors or assigns, takes possession of the Premises from
    Tenant, (ii) conditions existing prior to the date Tenant takes possession
    of the Premises, or (iii) conditions aggravated or worsened (but only to the
    extent so aggravated or worsened) by Landlord, or its successors, assigns or
    any third party, after the date Landlord or its successors and assigns takes
    such possession of the Premises. Landlord shall give Tenant prompt notice of
    any claim or information of which Landlord has knowledge that is likely to
    give rise to a claim for defense, indemnity or hold harmless under this
    Section, and shall permit Tenant's involvement in the defense of any such
    claim as reasonably requested by Tenant. Neither Landlord nor Tenant shall
    settle or pay any third party claim with respect to any claim hereunder,
    except upon the written approval of both Landlord and Tenant. The provisions
    hereof shall be in addition to any and all other obligations and liabilities
    Tenant may have to the Landlord at law or in equity and shall survive
    termination of this Lease and the satisfaction of all other obligations of
    Tenant hereunder.

D.  Right of Inspection.  Landlord, its successors and assigns shall have the
    -------------------
    right to inspect the Premises at any reasonable time and from time to time 
    upon not less than two (2) hours advance notice in order to determine
    whether Hazardous Materials are being used in violation of Environmental
    Law and whether Tenant is in full compliance with the terms of this Section,
    but Landlord shall have no obligation to conduct such inspections.  All 
    such inspections, including, without limitation, investigation, studies, 
    sampling and testing, shall be at Tenant's expense if the Premises are not
    in compliance with this Section, otherwise they shall be at Landlord's 
    expense.  Tenant is authorized to install its own security system for access
    to the Premises using so-called security card devices.  Tenant shall
    immediately release any such security system upon notice from Landlord's 
    security personnel that an emergency exists requiring access to the 
    Premises.  Inspections by Landlord under this paragraph shall not 
    unreasonably interfere with the operation of Tenant's business and Landlord
    shall comply with Tenant's Confidentiality Requirements (as defined in 
    Section 17.01 of this Lease) and Tenant's reasonable requests, provided, 
    however, these provisions are subject to any actions reasonably necessary
    to meet or ameliorate any emergency threatening serious bodily injury or
    property damage.

E.  Effect on Insurance.  Notwithstanding anything in this Section to the
    -------------------
    contrary, Tenant shall not use or occupy or permit the Premises to be
    used or occupied, nor do or permit anything to be done in or on the 
    Premises, in a manner which will in any way make void or voidable any
    insurance customary for buildings or property similar to the Premises
    (containing terms and conditions customary for insuring buildings or
    property similar to the Premises) then in force with respect thereto,
    or which will make it unreasonably difficult or impossible to obtain
    fire or other insurance (containing terms and conditions customary for
    insuring buildings or property similar to the Premises) carried by
    Landlord with respect to the property of which the Premises is a part.  If 
    Tenant's failure to comply with the provisions of this Section causes any
    insurance premium to be higher than it would otherwise be, Tenant shall
    reimburse Landlord, as additional rent, for that part of all insurance
    premiums thereafter paid by Landlord which have been changed because of
    Tenant's failure.

F.  Reports.  At reasonable intervals, and at least annually, Tenant shall
    -------
    provide to Landlord, at Landlord's request, a list of all Hazardous
    Materials at any time used, stored, placed or brought onto the Premises 
    since the date of the last report furnished to Landlord with respect to 
    Hazardous Materials.  In addition, Tenant shall provide to Landlord such
    reasonable documentation as Landlord may request to review the methods 
    and procedures used by the Tenant in handling and disposing of any Hazardous
    Materials.  If Landlord determines in its reasonable judgment that any
    Hazardous Material as it is being used by Tenant (taking into account the
    nature of the Hazardous
<PAGE>
 
Material, the manner of its use and the quantities on the Premises) presents an
unreasonable hazard to, or unreasonably endangers the health, safety or welfare
of, the Building's Tenants, or any of them, Tenant shall, as appropriate, upon
written notice from Landlord cease using any such Hazardous Material on the
Premises and immediately dispose of such Hazardous Material in compliance with
all Environmental Law or appropriately modify its use thereof so as to not
render such use unreasonably hazardous or dangerous. In the event that Tenant
disputes Landlord's assessment or designation of any prohibited Hazardous
Material, the matter shall be referred to an Environmental Engineer for
decision. The decision of such Environmental Engineer shall be conclusive on the
parties (except the extent that such decision is overridden by any governmental
authority enforcing any Environmental Law). The fees of such Environmental
Engineer shall be paid by the unsuccessful party and if both parties are
partially unsuccessful, the Environmental Engineer shall apportion such fees and
expenses between the parties, based on the degree of success of each party.

HAZARDOUS MATERIALS/LANDLORD'S OBLIGATION
-----------------------------------------

A.  Representations
    ---------------

    In addition, Landlord represents, warrants and covenants to Tenant that:

    1.  Landlord has not, and, to Landlord's knowledge no prior owner of the
        Building, tenant or prior tenant, occupant or prior occupant of the
        Building has, used or permitted the release of any Hazardous Materials
        on, from or affecting the Premises in any manner which violates
        Environmental Law.

    2.  Landlord has never received any summons, citation, directive, letter,
        notice or other communication, written or oral, regarding any violation
        of Environmental Law affecting the Premises, and there have been no
        actions commenced to Landlord's knowledge threatened by any party for
        noncompliance therewith.

    3.  Any and all plumbing, sewer and disposal systems, and pipelines and
        tanks, located upon or beneath or servicing the Premises will be
        maintained in good and safe operating condition and repair and to
        Landlord's knowledge are in good and safe operating condition and
        repair.
   

    If it is determined during or following the termination or expiration of the
    Lease that there is a violation of Environmental Law associated with the
    leased premises and the violation was not created by Tenant, its agents,
    representatives, contractors, officers, directors, employees, licensees or
    invitees in violation of Environmental Law then Landlord agrees to comply
    with all federal, state and local laws, ordinances, rules, regulations, and
    policies pertaining to such violation that are binding upon Landlord and to
    take whatever safety precautions and measures are required or prescribed, at
    the Landlord's expense. Landlord also agrees to defend and indemnify Tenant
    and its affiliates and their respective agents, representatives,
    contractors, officers, directors, employees, licensees and invitees, from
    and against all obligations, liabilities, loss, costs, damages, settlement
    or expenses of whatsoever kind or nature, known or unknown, contingent or
    otherwise, directly or indirectly arising out of or in any way related to
    any of the following caused solely by Landlord, its agents, representatives,
    contractors, officers, directors, employees, licensees or invitees: (i) the
    presence, disposal, release or threatened release of any Hazardous Materials
    on, over, under, from or affecting the Premises or the soil, water,
    vegetation, buildings, personal property, persons or animals thereon; (ii)
    any personal injury (including wrongful death) or property damage (real or
    personal) arising out of or related to such Hazardous Materials; (iii) any
    lawsuit brought or threatened, settlement reached or government order
    relating to such Hazardous Materials; and/or (iv) any violations of laws,
    regulations, requirements or demands of government authorities which are
    based upon or are in any way related to Hazardous Materials, including,
    without limitation and in each of the foregoing cases, reasonable attorney
    and consultant fees, investigation and laboratory fees, court costs and
    litigation expenses. Landlord will notify Tenant in writing immediately of
    any condition of which Landlord has knowledge and which involves Hazardous
    Materials or violation of Environmental Law which might affect the
    Premises. 


<PAGE>
 
                           FIRST AMENDMENT TO LEASE


This Amendment to Lease is made the 26th day of February, 1993, by and between
                                    ----
Domino's Farms Holding Limited Partnership, a Michigan Corporation, having
offices at 24 Frank Lloyd Wright Drive, Ann Arbor, Michigan 48105 ("Landlord"), 
and AASTROM Biosciences, Inc., having offices at 24 Frank Lloyd Wright Drive, 
Ann Arbor, Michigan 48105 ("Tenant").

WHEREAS, Landlord and Tenant entered into a Lease commencing October 1, 1992 
(the "Lease") for approximately 4,592 of usable square feet of office space in 
the building commonly known as Domino's Farms Prairie House; and

WHEREAS, Tenant desires modifications to be made to the original lease; and

WHEREAS, Landlord agrees to the modifications proposed by Tenant;

NOW, THEREFORE, in consideration of the mutual covenants contained in this
First Amendment to Lease, the parties agree to the following changes:


        Tenant expanded into an additional 191 square feet of usable space.
        Construction of said expansion was complete and rent became effective
        January 1, 1993.

        Per the terms of the original Lease, Landlord will contribute Five
        Thousand Three Hundred Forty Eight Dollars ($5,348) towards the
        construction costs for said expansion.

        The total monthly charge for rent will now be Nine Thousand Two Hundred
        Ninety Dollars and Ninety Eight Cents ($9,290.98).

        Per the original Lease, Tenant was to pay Landlord a Security Deposit in
        the amount of $8,919.96. Said deposit was not paid as of the date of
        this Amendment, and Landlord hereby waives requirement for said deposit.


IN WITNESS WHEREOF, this Amendment to Lease is executed on the 26th day of 
February, 1993.


                                                DOMINO'S FARMS HOLDING
                                                LIMITED PARTNERSHIP
                                                (A Michigan Corporation)

                                                By: /s/ THOMAS R. MINICK
                                                   -----------------------
                                                    Thomas R. Minick
  
                                                Its:



                                                AASTROM BIOSCIENCES, INC.
                                                (A Michigan Corporation)


                                                By:  /s/ R. Douglas Armstrong
                                                     -------------------------
                                                     R. Douglas Armstrong, Ph.D.
                                               Its:  President and C.E.O.
<PAGE>
 









                                     [CRC]
<PAGE>
 
                           SECOND AMENDMENT TO LEASE

This Amendment to Lease is made the third day of October, 1994, by and between 
DOMINO'S FARMS HOLDING LIMITED PARTNERSHIP, a Michigan Corporation, having 
offices at 24 Frank Lloyd Wright Drive, Ann Arbor, Michigan 48106 ("Landlord"), 
and AASTROM BIOSCIENCES, INC. having offices at 24 Frank Lloyd Wright Drive, Ann
Arbor, Michigan 48106 ("Tenant").

WHEREAS, Landlord and Tenant entered into a Lease commencing October 1, 1992
(the "Lease") for approximately 4,592 of usable square feet of office space in
the building commonly known as Domino's Farms Prairie House; and

WHEREAS, modifications were made to the original lease on February 26, 1993 
which increased the total usable square feet to 4,783 with a corresponding 
increase in rent charge; and

WHEREAS, Tenant desired further modifications to be made to the original lease 
and subsequent First Amendment; and

WHEREAS, Landlord agreed to the modifications proposed by Tenant;

NOW, THEREFORE, in consideration of the mutual covenants contained in this 
Second Amendment to Lease, the parties agree to the following changes:

1.  Tenant expanded into the former Allstate Insurance Company suite, effective
    July 12, 1993.  Said suite is 750 square feet, and is further identified on
    the attached floor plan.  Tenant accepted space in current configuration;
    Landlord painted suite, provided an allowance of $1,200 for carpet
    replacement (to be arranged by Tenant), and provided an allowance of $806.30
    for installation of soffit lighting (to be arranged by Tenant).  No further
    contribution was made by Landlord, and no further modifications to space 
    were made by Tenant.  Based upon the necessity of relocation of Allstate 
    Insurance Company to allow for said expansion, Tenant agreed to pay a pro-
    rated share of the unamortized tenant improvement costs initially paid by
    the Landlord.  A surcharge of $228.45 will be assessed each month through
    May 1995 (initial term covered by this Lease agreement).

2.  Tenant expanded into an additional 2,115 square feet of usable space,
    located between the leased premises and the expansion space described
    in Item #1 above.  Construction of said space was complete and rent
    became effective September 20, 1993.
    
    Per the terms of the original Lease, Landlord contributed Fifty Nine
    Thousand, Two Hundred Twenty Dollars ($59,220.00) towards the construction
    costs for said expansion.  Tenant contracted for and managed construction,
    with approval of Landlord.

3.  Tenant agreed to lease a storage room located on Level 1 of the Building.
    Said room is 868 square feet, of which 728 square feet is usable by Tenant,
    and is further identified on the attached floor plan.  Tenant agrees to at
    all times maintain a five foot (5') clear aisle to doors entering building
    mechanical room east of leased storage room.  Landlord agrees to provide an
    allowance of $600 for installation of electrical power to said room.  
    Tenant, at its expense, may elect to make additional modifications to room,
    and same will be coordinated with Landlord.  Rent for said room will be
    calculated based upon 728 square feet, at a rate of $8.00 per square foot,
    and will equal $485.33 per month.
<PAGE>
 
 4.  Based upon the changes described in Item #1 and #2 above, the total
     monthly charge for rent will now be based upon a total of 7,648 usable
     square feet, and will equal $14,856.24.  With the surcharge described in
     Item #1 above, total monthly rent due for office and lab space will equal
     $15,084.69.  Total rent due for storage space described in Item #3 above
     will equal $485.33.

 5.  The terms and conditions of the Lease shall remain in full force and
     effect except as specifically modified herein.

 IN WITNESS WHEREOF, this Second Amendment to Lease is executed on the date
 set forth above.

                                               AASTROM BIOSCIENCES, INC.
                                               (A Michigan Corporation)

                                               By:   /s/ R. DOUGLAS ARMSTRONG
                                                     ---------------------------
                                                     R. Douglas Armstrong, Ph.D.
                                               Its:  President & C.E.O.


                                               
                                               DOMINO'S FARMS HOLDING
                                               LIMITED PARTNERSHIP
                                               (A Michigan Corporation)

                                               By:   /s/ THOMAS R. MINICK
                                                     ---------------------------
                                                     Thomas R. Minick
                                               Its:  Vice President of Services
                                             

<PAGE>
 











                                     [CRC]
<PAGE>
 










                                     [CRC]
<PAGE>
 
                           THIRD AMENDMENT TO LEASE

This Amendment to Lease is made the 16th day of November, 1994, by and
                                    ----
between DOMINO'S FARMS HOLDING LIMITED PARTNERSHIP, a Michigan Corporation,
having offices at 24 Frank Lloyd Wright Drive, Ann Arbor, Michigan 48106 
("Landlord"), and AASTROM BIOSCIENCES, INC., having offices at 24 Frank Lloyd 
Wright Drive, Ann Arbor, Michigan 48106 ("Tenant").

WHEREAS, Landlord and Tenant entered into a Lease commencing October 1, 1992
(the "Lease") for approximately 4,592 of usable square feet of office space
in the building commonly known as Domino's Farms Prairie House; and

WHEREAS, modifications were made to the original lease on February 26, 1993 
which increased the total usable square feet to 4,783 with a corresponding 
increase in rent charge (First Amendment); and further modifications were 
made to the original lease on October 3, 1994 which increased the total usable 
square feet to 7,648 and provided for rental of a storage room of 728 square
feet, with corresponding increases in rent charge (Second Amendment); and

WHEREAS, Tenant desires further modifications to be made to the original lease 
and subsequent First and Second Amendments; and

WHEREAS, Landlord agrees to the modifications proposed by Tenant;

NOW, THEREFORE, in consideration of the mutual covenants contained in this
Third Amendment to Lease, the parties agree to the following changes:

1.  Tenant will expand into 6,723 usable square feet located across the
    corridor from the existing premises, and further identified on Attachment A.

2.  Modifications will be made to the expansion suite.  Tenant will be 
    responsible for development of plans and all aspects of the construction
    process.  However, plans must be submitted to and approved by Landlord
    prior to construction start-up.

3.  $188,244 will be contributed by the Landlord to the cost of the tenant
    improvements. This sum is equal to $28.00 per square foot. Further, Landlord
    will bear responsibility for certain work, to include floor leveling (cement
    work), installation of a fire damper, relocation of an alarm panel,
    construction of the demising wall along the East wall of the expansion
    suite, and installation of a major air supply duct. Upon completion of the
    project, as-built drawings and a financial summary will be provided to
    Landlord to detail the total scope of the project. Said improvements are
    projected to be completed by November 15, 1994.

4.  On or before January 1, 1995, Tenant will vacate and be released of all
    responsibility for the 750 usable square feet acquired by Tenant on July
    12, 1993.  Said space is required by Landlord for installation of a
    mechanical room.  A corresponding reduction in rent will be applied, and
    the monthly surcharge for said space will be discontinued.

5.  For the period of November 16, 1994 through March 15, 1995, Tenant will
    pay no rent for the expansion suite.  However, during this time period,
    Tenant will pay $7.35 per square foot ($4,117.84 per month) to be applied
    to the cost of utilities, maintenance, taxes, grounds, and housekeeping
    for the expansion suite.
<PAGE>
 
    For the period from March 16, 1995 through May 31, 1995, Tenant will pay 
    rent for the expansion suite at the same rate provided in the initial lease
    ($21.00 per square foot plus $2.31 for a utility charge).

6.  The Lease will expire on May 31, 1995, and via this Third Amendment,
    will be extended for an additional three year term (June 1, 1995 through
    May 31, 1998).  From June 1, 1995 forward, the rental rate will be
    considered a gross rate.

7.  Effective June 1, 1995, an annual increase of three percent (3%) will be
    applied to the rates for this Lease.  Said rates and rents due are detailed
    on Attachment B to this Amendment (Rent Payment Schedule).

8.  Tenant shall have a right to terminate the Lease during the three year
    extension period, in the event of any one of the following:

    a.)  Landlord is unable to provide acceptable space for further expansion
    of the Tenant; or

    b.)  AASTROM Biosciences, Inc. is acquired by another company and the
    company is relocated to a non-Michigan site; or

    c.)  Zoning or other governmental restrictions limit the Tenant from
    conducting business at Domino's Farms.

    In the event the Tenant elects to terminate the Lease based upon one of
    the stated factors, the following shall apply:

    i)    Tenant shall provide Landlord with twelve (12) month written notice
    of any intent to terminate.

    ii)   To the extent reasonable, Tenant will assist with location of a
    replacement tenant.  Subject to Section 16 of the Lease, Tenant may sub-
    lease the Premises.

    iii)  Tenant will re-pay the unamortized tenant improvements stated above
    ($188,244.00) based upon a three year amortization schedule.  Such re-
    payment of unamortized tenant improvements will be made only if Tenant is
    unable to find a sub-tenant and/or Landlord is unable to lease the premises
    essentially "as is" within ninety (90) days following the early termination
    date of Lease.

    iv)   The four month rent abatement will be re-paid if notice to terminate
    is given within the initial eighteen months of the three year lease 
    extension period.

9.  Tenant shall have a Second Right of Refusal for the approximately 7,590
    square feet located North of and contiguous to the expansion suite.
    (As of the date of this Amendment, Parke-Davis has a First Right of
    Refusal for said suite.)  Tenant shall have a First Right of Refusal for
    the approximately 5,000 square feet located North of and contiguous to the
    suite covered by the Second Right of Refusal.  Said suites are further
    identified on Attachment A.

    Under the exercise of either Right of Refusal stated above, the terms
    and conditions shall be as provided in Rider E of the Lease, with the
    exception of paragraph E(iii).  For any space previously unoccupied by a
    Tenant and in an unfinished status, an allowance in the set amount of
    $28.00 per square foot shall be provided.  For any space built out and
    occupied by another tenant, the Landlord would be responsible for any 
    negotiated
  
<PAGE>
 
     relocation and associated costs.  An allowance to Tenant would be
     provided in the amount of $8.00 per square foot for any alterations
     resulting in office space, and $12.00 per square foot for any alterations
     resulting in laboratory space.

10.  Tenant shall have one option to extend the lease for a term up to five
     (5) years.  Tenant shall notify Landlord in writing of intent to extend
     at lease one hundred eighty days (180) prior to lease expiration.  Rent
     for such extension shall be at a rate equivalent to the rate in effect
     during the last year of the lease prior to such proposed extension, with
     an adjustment of three percent (3%) applied during the first and each
     subsequent year of the extension.

11.  The terms and conditions of the Lease shall remain in full force and
     effect except as specifically modified herein.

IN WITNESS WHEREOF, this Third Amendment to Lease is executed on the
date set forth above.

                                        AASTROM BIOSCIENCES, INC.
                                        (A Michigan Corporation)

 
                                        By:   /s/ R. DOUGLAS ARMSTRONG
                                              ---------------------------
                                              R. Douglas Armstrong, Ph.D.
                                        Its:  President and C.E.O.



                                        DOMINO'S FARMS HOLDING
                                        LIMITED PARTNERSHIP
                                        (A Michigan Corporation)


                                        By:   /s/ THOMAS R. MINICK
                                              --------------------------
                                              Thomas R. Minick
                                        Its:  Vice President of Services
                                            
<PAGE>
 












                                     [CRC]
<PAGE>
 
                                 ATTACHMENT B
                                                                09-Dec-94
DOMINO'S FARMS PRAIRIE HOUSE
RENT PAYMENT SCHEDULE 

AASTROM BIOSCIENCES - PHASE V
-----------------------------
 
 
                         OFFICE RENT   STORAGE CAGE   STOREROOM     1994 EXPANSION
                       (6,898 SQ.FT.)   (64 SQ.Ft.)  (728 SQ.FT.)    (6,723 SQ.FT)  TOTAL RENT
==============================================================================================
                                                                     
10/01/94 - 10/31/94      15,084.69 *       64.00       485.33              N/A       15,634.02
11/01/94 - 11/30/94      15,084.69 *       64.00       485.33          2,058.92 **   17,692.94
12/01/94 - 12/31/94      15,084.69 *       64.00       485.33          4,117.84 **   19,751.86

01/01/95 - 01/31/95      13,399.37         64.00       485.33          4,117.84 **   18,066.54
02/01/95 - 02/28/95      13,399.37         64.00       485.33          4,117.84 **   18,066.54
03/01/95 - 03/31/95      13,399.37         64.00       485.33          8,935.26 ***  22,883.96
04/01/95 - 04/30/95      13,399.37         64.00       485.33         13,059.43      27,008.12
05/01/95 - 05/31/95      13,399.37         64.00       485.33         13,059.43      27,008.12
06/01/95 - 06/30/95      13,801.75         64.00       499.89         13,451.60      27,817.24
07/01/95 - 07/31/95      13,801.75         64.00       499.89         13,451.60      27,817.24
08/01/95 - 08/31/95      13,801.75         64.00       499.89         13,451.60      27,817.24
09/01/95 - 09/30/95      13,801.75         64.00       499.89         13,451.60      27,817.24
10/01/95 - 10/31/95      13,801.75         64.00       499.89         13,451.60      27,817.24
11/01/95 - 11/30/95      13,801.75         64.00       499.89         13,451.60      27,817.24
12/01/95 - 12/31/95      13,801.75         64.00       499.89         13,451.60      27,817.24

01/01/96 - 01/31/96      13,801.75         64.00       499.89         13,451.60      27,817.24
02/01/96 - 02/28/96      13,801.75         64.00       499.89         13,451.60      27,817.24
03/01/96 - 03/31/96      13,801.75         64.00       499.89         13,451.60      27,817.24
04/01/96 - 04/30/96      13,801.75         64.00       499.89         13,451.60      27,817.24
05/01/96 - 05/31/96      13,801.75         64.00       499.89         13,451.60      27,817.24
06/01/96 - 06/30/96      14,215.63         64.00       515.06         13,854.98      28,649.67
07/01/96 - 07/31/96      14,215.63         64.00       515.06         13,854.98      28,649.67
08/01/96 - 08/31/96      14,215.63         64.00       515.06         13,854.98      28,649.67
09/01/96 - 09/30/96      14,215.63         64.00       515.06         13,854.98      28,649.67
10/01/96 - 10/31/96      14,215.63         64.00       515.06         13,854.98      28,649.67
11/01/96 - 11/30/96      14,215.63         64.00       515.06         13,854.98      28,649.67
12/01/96 - 12/31/96      14,215.63         64.00       515.06         13,854.98      28,649.67

01/01/97 - 01/31/97      14,215.63         64.00       515.06         13,854.98      28,649.67
02/01/97 - 02/28/97      14,215.63         64.00       515.06         13,854.98      28,649.67
03/01/97 - 03/31/97      14,215.63         64.00       515.06         13,854.98      28,649.67
04/01/97 - 04/30/97      14,215.63         64.00       515.06         13,854.98      28,649.67
05/01/97 - 05/31/97      14,215.63         64.00       515.06         13,854.98      28,649.67
06/01/97 - 06/30/97      14,641.01         64.00       530.23         14,269.57      29,504.80
07/01/97 - 07/31/97      14,641.01         64.00       530.23         14,269.57      29,504.80
08/01/97 - 08/31/97      14,641.01         64.00       530.23         14,269.57      29,504.80
09/01/97 - 09/30/97      14,641.01         64.00       530.23         14,269.57      29,504.80
10/01/97 - 10/31/97      14,641.01         64.00       530.23         14,269.57      29,504.80
11/01/97 - 11/30/97      14,641.01         64.00       530.23         14,269.57      29,504.80
12/01/97 - 12/31/97      14,641.01         64.00       530.23         14,269.57      29,504.80

01/01/98 - 01/31/98      14,641.01         64.00       530.23         14,269.57      29,504.80
02/01/98 - 02/28/98      14,641.01         64.00       530.23         14,269.57      29,504.80
03/01/98 - 03/31/98      14,641.01         64.00       530.23         14,269.57      29,504.80
04/01/98 - 04/30/98      14,641.01         64.00       530.23         14,269.57      29,504.80
05/01/98 - 05/31/98      14,641.01         64.00       530.23         14,269.57      29,504.80
==============================================================================================
 
          * 1994 OFFICE RENT BASED ON 7,648 SQ. FT. AND INCLUDES THE
            ALLSTATE SURCHARGE OF $228.00.

         ** CAM EXPENSES ONLY - EFFECTIVE 11/16/94

        *** CAM EXPENSES AND RENT PRO-RATED TO REFLECT CHANGE EFFECTIVE
            ON THE 16TH.
<PAGE>
 
                      RENTAL AGREEMENT FOR STORAGE SPACE

1.  AASTROM BIOSCIENCES, INC. agrees to rent Storage Unit #13, located on
Level 1 of Prairie House, effective March 15, 1993.  It is understood that
rental is on a monthly basis, and can be terminated by either Landlord or
Tenant with thirty (30) days written notice.

2.  Rent for the period from March 15 through March 31, 1993 is $32.00. Rent for
a full calendar month is $64. Rate is $12 per square foot, based upon 64 square
feet (8' x 8'). The Tenant will be invoiced on a monthly basis, and rent shall
be due on the first day of each month.

3.  No security deposit is required, and a key request form must be submitted to
the Control Center for access to the unit.  Responsibility for any keys issued 
is solely the responsibility of the tenant.

4.  The unit will be used only for the storage of property, and will not be used
to store any edible, flammable, explosive, toxic or dangerous materials.
However, Landlord acknowledges that Tenant may store hazardous materials in said
unit, and Tenant agrees that any hazardous materials shall at all times be
stored in appropriate containers. The unit will never be intentionally damaged,
and rubbish will be disposed of in appropriate containers. Access will be only
during normal business hours. No alterations will be made to the unit.

5.  Signature below indicates an understanding that Landlord is only renting 
space, and will bear no responsibility for damage or loss to personal property 
contained within said space.  It is an option for the Tenant to secure and 
purchase property insurance through an independent agent.

6.  This rental agreement is independent and separate from any other lease the 
undersigned may have with respect to other space at the Domino's Farms complex.
                                                    
                                                    /s/ R. DOUGLAS ARMSTRONG
                                                    -------------------------
                                                    For Tenant



                                                    /s/ MARGARET PARKINSON
                                                    -------------------------
                                                    For Landlord
<PAGE>
 
                            FOURTH AMENDMENT TO LEASE



This Amendment to Lease is made this 29th day of July, 1996, by and between
DOMINO'S FARMS HOLDING LIMITED PARTNERSHIP, a Michigan Corporation, having
offices at 24 Frank Lloyd Wright Drive, Ann Arbor, Michigan 48106 ("Landlord"),
and AASTROM BIOSCIENCES, INC., a Michigan Corporation, having offices at 24
Frank Lloyd Wright Drive, Ann Arbor, Michigan 48106 ("Tenant").

WHEREAS, Landlord and Tenant entered into a Lease commencing October 1, 1992
(the "Lease") for approximately 4,592 of usable square feet of office space in
the building commonly known as Domino's Farms Prairie House; and

WHEREAS, modifications were made to the original lease on February 26, 1993
which increased the total usable square feet to 4,783 with a corresponding
increase in rent charge (First Amendment); and further modifications were made
to the original lease on October 3, 1994 which increased the total usable square
feet to 7,648 and provided for rental of a storage room of 728 square feet, with
corresponding increases in rent charge (Second Amendment); and further
modifications were made to the original lease on November 16, 1994 which
increased the total usable square feet to 14,371 with a corresponding increase
in rent charge (Third Amendment); and

WHEREAS, Tenant desires further modifications to be made to the original lease
and subsequent First, Second and Third Amendments; and

WHEREAS, Landlord agrees to the modifications proposed by Tenant;

NOW, THEREFORE, in consideration of the mutual covenants contained in this
Fourth Amendment to Lease, the parties agree to the following changes:

1.  Tenant will expand into 5,510 usable square feet, which is further
    identified on Attachment A.

2.  Modification will be made to the expansion suite. Tenant will be responsible
    for development of plans and all aspects of the construction process.
    However, plans must be submitted to and approved by Landlord prior to
    construction start-up. Upon project completion, Tenant must furnish Landlord
    with complete set of "as-built" drawings and a financial summary which
    details the total scope of the project.

3.  $66,668.00 will be contributed by the Landlord to the cost of the tenant
    improvements. Further, Landlord will bear responsibility for certain work,
    to include floor leveling (cement work), installation of two fire dampers,
    construction of the


<PAGE>
 
    demising wall along the North wall of the expansion suite, removal of storm
    conductor, removal of double doors on West wall and installation of glass to
    match building standard, and upgrade of patio area on West side of suite.

    The tenant improvement allowance provided by the Landlord shall be
    calculated as follows:

    2,550 square feet        $17.60 per square foot        $44,880.00
    1,568 square feet        $ 9.43 per square foot        $14,786.24
    1,392 square feet        $ 5.03 per square foot        $ 7,001.76
    -----------------                                      ----------
    5,510 square feet                                      $66,668.00

4.  Rent will commence on August 1, 1996 and shall run current with existing
    Lease term which will expire on May 31, 1998.

5.  An annual increase of three percent (3%) will be applied to the rates for
    this Lease. Said rates are as follows:

          8/1/96 to 5/31/97                        $24.73 per square foot
          6/1/97 to 5/31/98                        $25.47 per square foot

    A portion of the proposed expansion space is considered to be somewhat less
    desirable than usual, due to interior location or lower than normal ceiling
    height. Such areas amount to 2,808 square feet, and are further defined on
    Attachment B. Rental rate for same shall be as follows:

          8/1/96 to 5/31/97                        $18.00 per square foot
          6/1/97 to 5/31/98                        $18.54 per square foot

    Tenant currently occupies two (2) storage cages located on Level One in
    close proximity to the dock. Rental rate for same shall remain at a flat
    rate of $12.00 per square foot.

          Cage #1                                  $ 64.00 per month
          Cage #2                                  $336.00 per month

    Tenant currently occupies a 728 square foot storage room located on Level
    One of the building. Rental rate for same shall increase at a rate of three
    percent (3%) per year as follows:


   
<PAGE>
 
          8/1/96 to 5/31/97                    $8.49 per square foot
          6/1/97 to 5/31/98                    $8.74 per square foot



6.  Tenant shall have a right to terminate the Lease during the remaining lease
    term, in the event of any one of the following:

    a)   Landlord is unable to provide reasonably acceptable space for further 
         expansion of the Tenant; or

    b)   AASTROM Biosciences, Inc. is acquired by another company and the
         company is relocated to a non-Michigan site; or

    c)   Zoning or other governmental restrictions limit Tenant from conducting
         business at Domino' Farms.

         In the event the Tenant elects to terminate the Lease based upon one of
         the above stated factors, the following shall apply:

    i)   Tenant shall provide Landlord with twelve (12) month written notice of
         any intent to terminate.

    ii)  To the extent reasonable, Tenant will assist with location of a
         replacement tenant. Subject to Section 16 the Lease, Tenant may sub-
         lease the Premises.

    iii) In addition to the financial obligation defined in 8(iii) of the Third
         Amendment to Lease, the tenant will re-pay the unamortized tenant
         improvements stated above ($66,668.00) based upon a two year
         amortization schedule. Such repayment of unamortized tenant
         improvements will be made only if Tenant is unable to find a subtenant
         and/or Landlord is unable to lease the premises essentially "as is"
         within ninety (90) days following the early termination date of Lease.

7.  Tenant shall have a First Right of Refusal for the approximately 10,000
    square feet located North of and contiguous to the suite covered by this
    amendment.

    Under the exercise of the Right of Refusal stated above, the terms and
    conditions shall be as provided in Rider E of the Lease, with the exception
    of paragraph E(iii). For any space previously unoccupied by a Tenant and in
    an unfinished status, an allowance in the set amount of $28.00 per square
    foot shall be provided. For any space built out and occupied by
    another tenant, the Landlord would be responsible for any negotiated
    relocation and associated costs. An allowance to Tenant would be

<PAGE>
 
    provided in the amount of $8.00 per square foot for any alterations
    resulting in office space, and $12.00 per square foot for any alterations
    resulting in laboratory space. All such allowances are based upon a five (5)
    year lease term.

    Additionally, Tenant shall have a First Right of Refusal for the suite
    located on Level 3, between Lobby K and Lobby L, and directly above Tenant's
    premises. Any Tenant improvement allowance would depend on the proposed
    alterations to the suite and length of lease term.

8.  Tenant shall retain one option to extend the Lease for a term up to five (5)
    years, in whole or in part. Tenant shall notify Landlord in writing of
    intent to extend at least one hundred eighty (180) days prior to Lease
    expiration. Rent for such extension shall be at a rate equivalent to the
    rate in effect during the last year of the Lease prior to such proposed
    extension, with an adjustment of three percent (3%) applied during the first
    and each subsequent year of the extension.

9.  The terms and conditions of the Lease shall remain in full force and effect
    except as specifically modified herein.

IN WITNESS WHEREOF, this Fourth Amendment to Lease is executed on the date set 
forth above.



                                       AASTROM BIOSCIENCES, INC.
                                       (A Michigan Corporation)
                                       
                                         
                                       By:  /s/ Todd E. Simpson              
                                          ---------------------------------
                                       Its: Vice President - Financial
                                            Administrator, Chief Financial
                                            Officer
                                            -------------------------------



                                       DOMINO'S FARMS HOLDING LIMITED
                                       PARTNERSHIP
                                       (A Michigan Corporation)


                                       By:  /s/
                                          --------------------------------- 
                                       Its: 
                                           --------------------------------
<PAGE>
 


                     [ATTACHMENT A BLUEPRINT APPEARS HERE]
<PAGE>
 


                     [ATTACHMENT B BLUEPRINT APPEARS HERE]
<PAGE>
 
                         DOMINO'S FARMS PRAIRIE HOUSE
                             RENT PAYMENT SCHEUDLE



                                          STORAGE         STORE            1994              1994
                        OFFICE RENT        CAGE           ROOM          EXPANSION         EXPANSION
                       (6,695 sq. ft)  (64 sq. ft.)   (728 sq. ft.)   (6,723 sq ft.)    (5,510 sq. ft)      TOTAL RENT
======================================================================================================================
                                                                                           
10/01/94 - 10/31/94      15,084.69*        64.00          485.33                --                --         15,834.02
11/01/94 - 11/30/94      15,084.60*        64.00          485.33          2,058.92**              --         17,692.94
12/01/94 - 12/31/94      15,084.89*        64.00          485.33          4,117.84**              --         19,751.88
01/01/95 - 01/31/95      13,399.87         64.00          485.33          4,117.84**              --         18,066.54
02/01/95 - 02/28/95      13,389.37         64.00          485.33          4,117.84**              --         18,066.54
03/01/95 - 03/31/95      13,399.87         64.00          485.33          8,838.26***             --         22,883.98
04/01/95 - 04/30/95      13,399.87         64.00          485.33         13,059.49                --         27,006.18
05/01/95 - 05/31/95      13,399.87         64.00          485.33         13,059.43                --         27,006.13
06/01/95 - 06/30/95      13,001.75         64.00          499.89         13,451.60                --         27,817.24
                                          ----------------------------------------        ----------------------------
                                          576.00        4,382.53         62,916.16                --        193,929.36

07/01/95 - 07/31/95      13,801.75         64.00          499.89         13,451.60                --         27,817.24
08/01/95 - 08/31/95      13,801.75         64.00          499.89         13,451.60                --         27,817.24
09/01/95 - 09/30/95      13,801.75         64.00          499.89         13,451.60                --         27,817.24
10/01/95 - 10/31/95      13,801.75         64.00          499.89         13,451.60                --         27,817.24
11/01/95 - 11/30/95      13,801.75         64.00          499.89         13,451.60                --         27,817.24
12/01/95 - 12/31/95      13,801.75         64.00          499.89         13,451.60                --         27,817.24
01/01/96 - 01/31/96      13,801.75         64.00          499.89         13,451.60                --         27,817.24
02/01/96 - 02/29/96      13,801.75         64.00          499.89         13,451.60                --         27,817.24
03/01/96 - 03/31/96      13,801.75         64.00          499.89         13,451.60                --         27,817.24
04/01/96 - 04/30/96      13,801.75         64.00          499.89         13,451.60                --         27,817.24
05/01/96 - 05/31/96      13,801.75         64.00          499.89         13,451.60                --         27,817.24
06/01/96 - 06/30/96      14,215.83         64.00          515.06         13,854.98                --         28,849.87
                                          ----------------------------------------        ----------------------------
                                          768.00        6,013.85        161,822.58                --        334,639.31

07/01/96 - 07/31/96      14,215.63         64.00          515.06         13,854.98                --         28,649.67
08/01/96 - 08/31/96      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
09/01/96 - 09/30/96      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
10/01/96 - 10/31/96      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
11/01/96 - 11/30/96      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
12/01/96 - 12/31/96      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
01/01/97 - 01/31/97      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
02/01/97 - 02/28/97      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
03/01/97 - 03/31/97      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
04/01/97 - 04/30/97      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
05/01/97 - 05/31/97      14,215.63         64.00          515.06         13,854.98          9,780.37         38,430.04
06/01/97 - 06/30/97      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
                                          ----------------------------------------        ----------------------------
                                          768.00        6,195.89        166,874.35        107,877.05        452,528.23

07/01/97 - 07/31/97      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
08/01/97 - 08/31/97      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
09/01/97 - 09/30/97      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
10/01/97 - 10/31/97      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
11/01/97 - 11/30/97      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
12/01/97 - 12/31/97      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
01/01/98 - 01/31/98      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
02/01/98 - 02/28/98      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
03/01/98 - 03/31/98      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
04/01/98 - 04/30/98      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
05/01/98 - 05/31/98      14,641.01         64.00          530.23         14,269.57         10,073.35         39,578.16
                                          ----------------------------------------        ----------------------------
                                          704.00        5,892.83        186,988.27        110,806.85        436,359.76
 

  *  1994 Office Rental based on 7,648 sq. ft. and includes the Allstate 
     surcharge of $228.00

 **  CAM expenses only - Effective 11/16/94

***  CAM expenses and rent pro-rated to reflect change effective on the 16th.