General Description: The standalone version of Synopsys Express which can be accessed through Foundation 1.5i has an additional synthesis option regarding FSM encoding (zero-one-hot) which is not present when the Express synthesis tool is used in a Foundation project.
Zero-one-hot is an encoding style similar to One-hot. This format requires N-1 flip flops to define N unique states, where the reset state is defined by all zeros.
Solution
This option has been implemented in Foundation 2.1i. Select Synthesis -> Options to set this encoding style (and then re-analyze your HDL source).