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                                                                   EXHIBIT 10.29

                              ZYMOGENETICS, INC.

                           2001 STOCK INCENTIVE PLAN

                              SECTION 1.  PURPOSE

     The purpose of the ZymoGenetics, Inc. 2001 Stock Incentive Plan (the
"Plan") is to enhance the long-term shareholder value of ZymoGenetics, Inc., a
Washington corporation (the "Company"), by offering opportunities to selected
persons to participate in the Company's growth and success, and to encourage
them to remain in the service of the Company or a Related Company (as defined in
Section 2) and to acquire and maintain stock ownership in the Company.

                            SECTION 2.  DEFINITIONS

     In the Plan:

     "Award" means any Option or Stock Award.

     "Board" means the Board of Directors of the Company.

     "Cause," unless otherwise defined in the instrument evidencing the Award or
in a written employment or services agreement between the Participant and the
Company or a Related Company, means dishonesty, fraud, misconduct, unauthorized
use or disclosure of confidential information or trade secrets, or conviction or
confession of a crime punishable by law (except minor violations), in each case
as determined by the Plan Administrator, and its determination shall be
conclusive and binding.

     "Code" means the Internal Revenue Code of 1986, as amended from time to
time.

     "Common Stock" means the common stock, no par value, of the Company.

     "Company Transaction," unless otherwise defined in the instrument
evidencing the Award or in a written employment or services agreement between
the Participant and the Company or a Related Company, means consummation of
either

     (a) a merger or consolidation of the Company with or into any other
company, entity or person or

     (b) a sale, lease, exchange or other transfer in one transaction or a
series of related transactions undertaken with a common purpose of all or
substantially all the Company's then outstanding securities or all or
substantially all the Company's assets;
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provided, however, that a Company Transaction shall not include a Related Party
Transaction.

     "Disability," unless otherwise defined by the Plan Administrator or in the
instrument evidencing the Award or in a written employment or services agreement
between the Participant and the Company or a Related Company, means a mental or
physical impairment of the Participant that is expected to result in death or
that has lasted or is expected to last for a continuous period of 12 months or
more and that causes the Participant to be unable, in the opinion of the Plan
Administrator, to perform his or her duties for the Company or a Related Company
and to be engaged in any substantial gainful activity.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended.

     "Fair Market Value" means the per share value of the Common Stock as
established in good faith by the Plan Administrator or, if the Common Stock is
(a) listed on the Nasdaq National Market, the closing sales price for the Common
Stock as reported by that market for regular session trading for a single
trading day or (b) listed on the New York Stock Exchange or the American Stock
Exchange, the closing sales price for the Common Stock as such price is
officially quoted in the composite tape of transactions on such exchange for
regular session trading for a single trading day.  If there is no such reported
price for the Common Stock for the date in question, then such price on the last
preceding date for which such price exists shall be determinative of Fair Market
Value.

     "Grant Date" means the date on which the Plan Administrator completes the
corporate action authorizing the grant of an Award or such later date specified
by the Plan Administrator, provided that conditions to the exercisability or
vesting of Awards shall not defer the Grant Date.

     "Incentive Stock Option" means an Option granted with the intention that it
qualify as an "incentive stock option" as that term is defined in Section 422 of
the Code or any successor provision thereto.

     "Nonqualified Stock Option" means an Option other than an Incentive Stock
Option.

     "Option" means the right to purchase Common Stock granted under Section 7.

     "Option Expiration Date" has the meaning set forth in Section 7.6.

     "Option Term" has the meaning set forth in Section 7.3.

     "Participant" means the person to whom an Award is granted.

     "Plan Administrator" has the meaning set forth in Section 3.1.

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     "Related Company" means any entity that, directly or indirectly, is in
control of or is controlled by the Company.

     "Related Party Transaction" means (a) a merger or consolidation of the
Company in which the holders of the outstanding voting securities of the Company
immediately prior to the merger or consolidation hold at least a majority of the
outstanding voting securities of the Successor Company immediately after the
merger or consolidation; (b) a sale, lease, exchange or other transfer of the
Company's assets to a majority-owned subsidiary company; (c) a transaction
undertaken for the principal purpose of restructuring the capital of the
Company, including but not limited to, reincorporating the Company in a
different jurisdiction or creating a holding company; or (d) a corporate
dissolution or liquidation.

     "Retirement," unless otherwise defined by the Plan Administrator from time
to time for purposes of the Plan, means retirement as of the person's normal
retirement date under the Company's 401(k) plan or other similar successor plan
applicable to salaried employees.

     "Securities Act" means the Securities Act of 1933, as amended.

     "Stock Award" means an Award of shares of Common Stock or units denominated
in Common Stock granted under Section 9, the rights of ownership of which may be
subject to restrictions prescribed by the Plan Administrator.

     "Successor Company" means the surviving company, the successor company or
its parent, as applicable, in connection with a Company Transaction.

     "Termination of Service" means a termination of employment or service
relationship with the Company or a Related Company for any reason, whether
voluntary or involuntary, including by reason of death, Disability or
Retirement, as determined by the Plan Administrator in its sole discretion.  Any
question as to whether and when there has been a Termination of Service for the
purposes of an Award and the cause of such Termination of Service shall be
determined by the Plan Administrator and its determination shall be final.
Transfer of the Participant's employment or service relationship between Related
Companies, or between the Company and any Related Company, shall not be
considered a Termination of Service for purposes of an Award, but unless the
Plan Administrator determines otherwise, a Termination of Service shall be
deemed to occur if the Participant's employment or service relationship is with
an entity that has ceased to be a Related Company.

     "Vesting Commencement Date" means the Grant Date or such other date
selected by the Plan Administrator as the date from which the Option begins to
vest for purposes of Section 7.4.

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                          SECTION 3.  ADMINISTRATION

3.1  Plan Administrator

     The Plan shall be administered by the Board and/or a committee or
committees (which term includes subcommittees) appointed by, and consisting of
two or more members of, the Board (a "Plan Administrator").  If and so long as
the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act,
the Board shall consider in selecting the members of any committee acting as
Plan Administrator, with respect to any persons subject or likely to become
subject to Section 16 of the Exchange Act, the provisions regarding (a) "outside
directors" as contemplated by Section 162(m) of the Code and (b) "nonemployee
directors" as contemplated by Rule 16b-3 under the Exchange Act.
Notwithstanding the foregoing, the Board may delegate the responsibility for
administering the Plan with respect to designated classes of eligible persons to
different committees consisting of two or more members of the Board, subject to
such limitations as the Board deems appropriate.  Committee members shall serve
for such term as the Board may determine, subject to removal by the Board at any
time.  To the extent consistent with applicable law, the Board may authorize one
or more senior executive officers of the Company to grant Awards to designated
classes of eligible persons, within the limits specifically prescribed by the
Board.

3.2  Administration and Interpretation by Plan Administrator

     Except for the terms and conditions explicitly set forth in the Plan, the
Plan Administrator shall have exclusive authority, in its discretion, to
determine all matters relating to Awards under the Plan, including (a) selecting
the persons to be granted Awards, (b) determining the type of Awards, the number
of shares of Common Stock subject to an Award, and all terms, conditions,
restrictions and limitations, if any, of an Award, and (c) approving the forms
of agreement for use under the Plan.  The Plan Administrator shall also have
exclusive authority to interpret the Plan and the terms of any instrument
evidencing the Award and may from time to time adopt and change rules and
regulations of general application for the Plan's administration.  The Plan
Administrator's interpretation of the Plan and its rules and regulations, and
all actions taken and determinations made by the Plan Administrator pursuant to
the Plan, shall be conclusive and binding on all parties involved or affected.
The Plan Administrator may delegate ministerial duties to such of the Company's
officers as it so determines.  For purposes of determining the effect on an
Award of a Company-approved leave of absence or a Participant's working less
than full time, the human resources director or other person performing that
function may be deemed the Plan Administrator.

                     SECTION 4.  STOCK SUBJECT TO THE PLAN

4.1  Authorized Number of Shares

     Subject to adjustment from time to time as provided in Section 12.1, the
maximum number of shares of Common Stock available for issuance under the Plan
shall be:

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     (a)  an annual increase to be added as of the first day of each fiscal year
of the Company equal to the least of (i) 750,000 shares and (ii) 5% of the
outstanding Common Stock of the Company as of the end of the Company's
immediately preceding fiscal year and (iii) a lesser amount determined by the
Board; provided, however, that the first annual increase under the Plan shall
occur upon the later of the Company's fiscal year beginning in 2002 and the
effective date of the Company's initial registration of the Common Stock under
Section 12(b) or 12(g) of the Exchange Act; and provided further that any shares
from any such increases in previous years that are not actually issued shall
continue to be available for issuance under the Plan; plus

     (b)  any authorized shares (i) not issued or subject to outstanding awards
under the Company's Amended and Restated 2000 Stock Incentive Plan (the "Prior
Plan") on the date the initial registration of the Common Stock under 12(b) or
12(g) of the Exchange Act first becomes effective and (ii) any shares subject to
outstanding awards under the Prior Plan on such date that thereafter cease to be
subject to such awards (other than by reason of exercise or settlement of the
awards to the extent they are exercised for or settled in vested and
nonforfeitable shares), up to an aggregate maximum of 2,448,500 shares.

     Shares issued under the Plan shall be drawn from authorized and unissued
shares or shares now held or subsequently acquired by the Company.

4.2  Reuse of Shares

     Any shares of Common Stock that have been made subject to an Award that are
not issued under the Plan upon exercise or settlement of the Award shall again
be available for issuance in connection with future grants of Awards under the
Plan.  In addition, if shares issued under the Plan are reacquired by the
Company pursuant to any forfeiture provision, such shares shall again be
available for the purposes of the Plan.  Notwithstanding the foregoing, the
maximum number of shares that may be issued upon the exercise of Incentive Stock
Options shall equal the aggregate share number stated in Section 4.1, subject to
adjustment from time to time as provided in Section 12.1.

                            SECTION 5.  ELIGIBILITY

     An Award may be granted to any officer, director or employee of the
Company or a Related Company that the Plan Administrator from time to time
selects.  An Award may also be granted to any consultant, advisor or independent
contractor who provides services to the Company or any Related Company, so long
as such Participant (a) renders bona fide services that are not in connection
with the offer and sale of the Company's securities in a capital-raising
transaction and (b) does not directly or indirectly promote or maintain a market
for the Company's securities.

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                              SECTION 6.  AWARDS

6.1  Form and Grant of Awards

     The Plan Administrator shall have the authority, in its sole discretion, to
determine the type or types of Awards to be granted under the Plan.  Awards may
be granted singly or in combination.

6.2  Settlement of Awards

     The Company may settle Awards through the delivery of shares of Common
Stock, the granting of replacement Awards or any combination thereof as the Plan
Administrator shall determine.  Any Award settlement may be subject to such
conditions, restrictions and contingencies as the Plan Administrator shall
determine.  The Plan Administrator may permit or require the deferral of any
Award payment, subject to such rules and procedures as it may establish, which
may include provisions for the payment or crediting of interest, or dividend
equivalents, including converting such credits into deferred stock equivalents.

6.3  Acquired Company Awards

     Notwithstanding anything in the Plan to the contrary, the Plan
Administrator may grant Awards under the Plan in substitution for awards issued
under other plans, or assume under the Plan awards issued under other plans, if
the other plans are or were plans of other acquired entities ("Acquired
Entities") (or the parent of an Acquired Entity) and the new Award is
substituted, or the old award is assumed, by reason of a merger, consolidation,
acquisition of property or stock, reorganization or liquidation (the
"Acquisition Transaction").  In the event that a written agreement pursuant to
which the Acquisition Transaction is completed is approved by the Board and said
agreement sets forth the terms and conditions of the substitution for or
assumption of outstanding awards of the Acquired Entity, said terms and
conditions shall be deemed to be the action of the Plan Administrator without
any further action by the Plan Administrator, except as may be required for
compliance with Rule 16b-3 under the Exchange Act, and the persons holding such
awards shall be deemed to be Participants.

                         SECTION 7.  AWARDS OF OPTIONS

7.1  Grant of Options

     The Plan Administrator shall have the authority, in its sole discretion, to
grant Options designated as Incentive Stock Options or as Nonqualified Stock
Options.

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7.2  Option Exercise Price

     The exercise price for shares purchased under an Option shall be as
determined by the Plan Administrator, but shall not be less than the minimum
exercise price required by Section 8.3 with respect to Incentive Stock Options.

7.3  Term of Options

     Subject to earlier termination in accordance with the terms of the Plan and
the instrument evidencing the Option, the maximum term of an Option (the "Option
Term") shall be as established for that Option by the Plan Administrator or, if
not so established, shall be ten years from the Grant Date.  For Incentive Stock
Options, the Option Term shall be as specified in Section 8.4.

7.4  Exercise of Options

     The Plan Administrator shall establish and set forth in each instrument
that evidences an Option the time at which, or the installments in which, the
Option shall vest and become exercisable, any of which provisions may be waived
or modified by the Plan Administrator at any time.  If not so established in the
instrument evidencing the Option, the Option shall vest and become exercisable
according to the following schedule, which may be waived or modified by the Plan
Administrator at any time:

Period of Participant's Continuous
Employment or Service With the Company
or Its Related Companies From the Vesting         Portion of Total Option
Commencement Date                                 That Is Vested and Exercisable

After 1 year                                      1/4/th/

Each additional three-month period of             An additional 1/16/th/
continuous service completed thereafter

After 4 years                                     100%

     The Plan Administrator, in its sole discretion, may adjust the vesting
schedule of an Option held by a Participant who works less than "full time" as
that term is defined by the Plan Administrator or who takes a Company-approved
leave of absence.

     To the extent an Option has vested and become exercisable, the Option may
be exercised in whole or from time to time in part by delivery to the Company of
a written stock option exercise agreement or notice, in a form and in accordance
with procedures established by the Plan Administrator, setting forth the number
of shares with respect to which the Option is being exercised, the restrictions
imposed on the shares purchased under such exercise agreement, if any, and such
representations and agreements as may be required by

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the Plan Administrator, accompanied by payment in full as described in Section
7.5. An Option may be exercised only for whole shares and may not be exercised
for less than a reasonable number of shares at any one time, as determined by
the Plan Administrator.

7.5  Payment of Exercise Price

     The exercise price for shares purchased under an Option shall be paid in
full to the Company by delivery of consideration equal to the product of the
Option exercise price and the number of shares purchased.  Such consideration
must be paid before the Company will issue the shares being purchased and must
be in a form or a combination of forms acceptable to the Plan Administrator for
that purchase, which forms may include:

     (a)  cash;

     (b)  check;

     (c)  tendering (either actually or, if the Common Stock is registered under
Section 12(b) or 12(g) of the Exchange Act, by attestation) shares of Common
Stock already owned by the Participant for at least six months (or any shorter
period necessary to avoid a charge to the Company's earnings for financial
reporting purposes) that on the day prior to the exercise date have a Fair
Market Value equal to the aggregate exercise price of the shares being purchased
under the Option;

     (d)  if the Common Stock is registered under Section 12(b) or 12(g) of the
Exchange Act, delivery of a properly executed exercise notice, together with
irrevocable instructions to a brokerage firm designated by the Company to
deliver promptly to the Company the aggregate amount of sale or loan proceeds to
pay the Option exercise price and any withholding tax obligations that may arise
in connection with the exercise, all in accordance with the regulations of the
Federal Reserve Board; or

     (e)  such other consideration as the Plan Administrator may permit.

     In addition, to assist a Participant (including a Participant who is an
officer or a director of the Company) in acquiring shares of Common Stock
pursuant to an Award granted under the Plan, the Plan Administrator, in its sole
discretion, may authorize, either at the Grant Date or at any time before the
acquisition of Common Stock pursuant to the Award, (i) the payment by a
Participant of the purchase price of the Common Stock by a promissory note or
(ii) the guarantee by the Company of a loan obtained by the Participant from a
third party.  Such notes or loans must be full recourse to the extent necessary
to avoid charges to the Company's earnings for financial reporting purposes.
Subject to the foregoing, the Plan Administrator shall in its sole discretion
specify the terms of any loans or loan guarantees, including the interest rate
and terms of and security for repayment.

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7.6  Post-Termination Exercises

     The Plan Administrator shall establish and set forth in each instrument
that evidences an Option whether the Option shall continue to be exercisable,
and the terms and conditions of such exercise, if a Participant ceases to be
employed by, or to provide services to, the Company or a Related Company, which
provisions may be waived or modified by the Plan Administrator at any time.  If
not so established in the instrument evidencing the Option, the Option shall be
exercisable according to the following terms and conditions, which may be waived
or modified by the Plan Administrator at any time:

     (a)  Any portion of an Option that is not vested and exercisable on the
date of a Participant's Termination of Service shall expire on such date.

     (b)  Any portion of an Option that is vested and exercisable on the date of
a Participant's Termination of Service shall expire on the earliest to occur of

          (i)   if the Participant's Termination of Service occurs for reasons
other than Cause, Retirement, Disability or death, the date which is three
months after such Termination of Service;

          (ii)  if the Participant's Termination of Service occurs by reason of
Retirement, Disability or death, the one-year anniversary of such Termination of
Service; and

          (iii) the last day of the Option Term (the "Option Expiration Date").

     Notwithstanding the foregoing, if a Participant dies after his or her
Termination of Service but while the Option is otherwise exercisable, the
portion of the Option that is vested and exercisable on the date of such
Termination of Service shall expire upon the earlier to occur of (y) the Option
Expiration Date and (z) the one-year anniversary of the date of death, unless
the Plan Administrator determines otherwise.

     Also notwithstanding the foregoing, in case a Participant's Termination of
Service occurs for Cause, all Options granted to the Participant shall
automatically expire upon first notification to the Participant of such
termination, unless the Plan Administrator determines otherwise.  If a
Participant's employment or service relationship with the Company is suspended
pending an investigation of whether the Participant shall be terminated for
Cause, all the Participant's rights under any Option shall likewise be suspended
during the period of investigation.  If any facts that would constitute
termination for Cause are discovered after a Participant's Termination of
Service, any Option then held by the Participant may be immediately terminated
by the Plan Administrator, in its sole discretion.

     (c)  A Participant's change in status from an employee to a consultant,
advisor or independent contractor or a change in status from a consultant,
advisor or independent contractor to an employee, shall not be considered a
Termination of Service for purposes of this Section 7.

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     (d)  The effect of a Company-approved leave of absence on the application
of this Section 7 shall be determined by the Plan Administrator, in its sole
discretion.

7.7  Acceleration of Vesting

     If a Participant's Termination of Service occurs by reason of death, the
Option shall become fully vested and exercisable for all the shares subject to
the Option.  Such Option shall remain exercisable for the time period set forth
in Section 7.6.

                SECTION 8.  INCENTIVE STOCK OPTION LIMITATIONS

     Notwithstanding any other provisions of the Plan, and to the extent
required by Section 422 of the Code, Incentive Stock Options shall be subject to
the following additional terms and conditions:

8.1  Dollar Limitation

     To the extent the aggregate Fair Market Value (determined as of the Grant
Date) of Common Stock with respect to which a Participant's Incentive Stock
Options become exercisable for the first time during any calendar year (under
the Plan and all other stock option plans of the Company and its parent and
subsidiary corporations) exceeds $100,000, such portion in excess of $100,000
shall be treated as a Nonqualified Stock Option.  In the event the Participant
holds two or more such Options that become exercisable for the first time in the
same calendar year, such limitation shall be applied on the basis of the order
in which such Options are granted.

8.2  Eligible Employees

     Individuals who are not employees of the Company or one of its parent or
subsidiary corporations may not be granted Incentive Stock Options.

8.3  Exercise Price

     The exercise price of an Incentive Stock Option shall be at least 100% of
the Fair Market Value of the Common Stock on the Grant Date, and in the case of
an Incentive Stock Option granted to a Participant who owns more than 10% of the
total combined voting power of all classes of the stock of the Company or of its
parent or subsidiary corporations (a "Ten Percent Shareholder"), shall not be
less than 110% of the Fair Market Value of the Common Stock on the Grant Date.
The determination of more than 10% ownership shall be made in accordance with
Section 422 of the Code.

8.4  Option Term

     Subject to earlier termination in accordance with the terms of the Plan and
the instrument evidencing the Option, the Option Term of an Incentive Stock
Option shall not

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exceed ten years, and in the case of an Incentive Stock Option granted to a Ten
Percent Shareholder, shall not exceed five years.

8.5  Exercisability

     An Option designated as an Incentive Stock Option shall cease to qualify
for favorable tax treatment as an Incentive Stock Option to the extent it is
exercised (if permitted by the terms of the Option) (a) more than three months
after the date of a Participant's Termination of Service if termination was for
reasons other than death or Disability, (b) more than one year after the date of
a Participant's Termination of Service if termination was by reason of
Disability, or (c) after the Participant has been on leave of absence for more
than 90 days, unless the Participant's reemployment rights are guaranteed by
statute or contract.

8.6  Taxation of Incentive Stock Options

     In order to obtain certain tax benefits afforded to Incentive Stock Options
under Section 422 of the Code, the Participant must hold the shares acquired
upon the exercise of an Incentive Stock Option for two years after the Grant
Date and one year after the date of exercise.

     A Participant may be subject to the alternative minimum tax at the time of
exercise of an Incentive Stock Option.  The Participant shall give the Company
prompt notice of any disposition of shares acquired on the exercise of an
Incentive Stock Option prior to the expiration of such holding periods.

8.7  Promissory Notes

     The amount of any promissory note delivered pursuant to Section 7.5 in
connection with an Incentive Stock Option shall bear interest at a rate
specified by the Plan Administrator, but in no case less than the rate required
to avoid imputation of interest (taking into account any exceptions to the
imputed interest rules) for federal income tax purposes.

8.8  Code Definitions

     For the purposes of this Section 8, "parent corporation" and "subsidiary
corporation" shall have the meanings attributed to those terms for purposes of
Section 422 of the Code.

                           SECTION 9.  STOCK AWARDS

9.1  Grant of Stock Awards

     The Plan Administrator is authorized to make Awards of Common Stock or
Awards denominated in units of Common Stock on such terms and conditions and
subject to such repurchase or forfeiture restrictions, if any (which may be
based on continuous service with

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the Company or the achievement of performance goals, where such goals may be
stated in absolute terms or relative to comparison companies), as the Plan
Administrator shall determine, in its sole discretion, which terms, conditions
and restrictions shall be set forth in the instrument evidencing the Award. The
terms, conditions and restrictions that the Plan Administrator shall have the
power to determine shall include, without limitation, the manner in which shares
subject to Stock Awards are held during the periods they are subject to
restrictions and the circumstances under which repurchase or forfeiture of the
Stock Award shall occur by reason of a Participant's Termination of Service.

9.2  Issuance of Shares

     Upon the satisfaction of any terms, conditions and restrictions prescribed
in respect to a Stock Award, or upon a Participant's release from any terms,
conditions and restrictions of a Stock Award, as determined by the Plan
Administrator, the Company shall release, as soon as practicable, to the
Participant or, in the case of the Participant's death, to the personal
representative of the Participant's estate or as the appropriate court directs,
the appropriate number of shares of Common Stock.

9.3  Waiver of Restrictions

     Notwithstanding any other provisions of the Plan, the Plan Administrator
may, in its sole discretion, waive the repurchase or forfeiture period and any
other terms, conditions or restrictions on any Stock Award under such
circumstances and subject to such terms and conditions as the Plan Administrator
shall deem appropriate.

                           SECTION 10.  WITHHOLDING

     The Company may require the Participant to pay to the Company the amount of
any taxes that the Company is required by applicable federal, state, local or
foreign law to withhold with respect to the grant, vesting or exercise of an
Award.  The Company shall not be required to issue any shares of Common Stock
under the Plan until such obligations are satisfied.

     The Plan Administrator may permit or require a Participant to satisfy all
or part of his or her tax withholding obligations by (a) paying cash to the
Company, (b) having the Company withhold from any cash amounts otherwise due or
to become due from the Company to the Participant, (c) having the Company
withhold a number of shares of Common Stock that would otherwise be issued to
the Participant (or become vested in the case of Stock Awards) having a value
equal to the tax withholding obligations, or (d) tendering a number of shares of
Common Stock the Participant already owns having a value equal to the tax
withholding obligations.  The value of any shares withheld pursuant to (c) may
not exceed the employer's minimum required tax withholding rate, and the value
of any shares tendered pursuant to (d) may not exceed such rate to the extent
the Participant has owned the tendered shares for less than six months if such
limitation is necessary to avoid a charge to the Company for financial reporting
purposes.

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                          SECTION 11.  ASSIGNABILITY

      No Award or interest in an Award may be assigned, pledged or transferred
by the Participant or made subject to attachment or similar proceedings
otherwise than by will or by the applicable laws of descent and distribution,
except to the extent a Participant designates a beneficiary on a Company-
approved form who may exercise the Award or receive payment under the Award
after the Participant's death. During a Participant's lifetime, an Award may be
exercised only by the Participant. Notwithstanding the foregoing and to the
extent permitted by Section 422 of the Code, the Plan Administrator, in its sole
discretion, may permit a Participant to assign or transfer an Award; provided,
however, that any Award so assigned or transferred shall be subject to all the
terms and conditions of the Plan and those contained in the instrument
evidencing the Award.

                           SECTION 12.  ADJUSTMENTS

12.1  Adjustment of Shares

      In the event that, at any time or from time to time, a stock dividend,
stock split, spin-off, combination or exchange of shares, recapitalization,
merger, consolidation, distribution to shareholders other than a normal cash
dividend, or other change in the Company's corporate or capital structure
results in (a) the outstanding shares of Common Stock, or any securities
exchanged therefor or received in their place, being exchanged for a different
number or kind of securities of the Company or of any other company or (b) new,
different or additional securities of the Company or of any other company being
received by the holders of shares of Common Stock of the Company, then the Plan
Administrator shall make proportional adjustments in (i) the maximum number and
kind of securities subject to the Plan and issuable as Incentive Stock Options
as set forth in Section 4, (ii) the number and kind of securities automatically
granted pursuant to a formula program established under the Plan, and (iii) the
number and kind of securities that are subject to any outstanding Award and the
per share price of such securities, without any change in the aggregate price to
be paid therefor.  The determination by the Plan Administrator as to the terms
of any of the foregoing adjustments shall be conclusive and binding.
Notwithstanding the foregoing, a dissolution or liquidation of the Company or a
Company Transaction shall not be governed by this Section 12.1 but shall be
governed by Sections 12.2 and 12.3, respectively.

12.2  Dissolution or Liquidation

      To the extent not previously exercised or settled, and unless otherwise
determined by the Plan Administrator in its sole discretion, Options and Stock
Awards denominated in units shall terminate immediately prior to the dissolution
or liquidation of the Company.  To the extent a forfeiture provision or
repurchase right applicable to an Award has not been waived by the Plan
Administrator, the Award shall be forfeited immediately prior to the
consummation of the dissolution or liquidation.

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12.3  Company Transaction

      12.3.1  Options

      In the event of a Company Transaction, except as otherwise provided in the
instrument evidencing an Option or in a written employment or services agreement
between the Participant and the Company or a Related Company,

      (a) Except as provided in subsection (b) below, each outstanding Option
shall be assumed or an equivalent option or right substituted by the Successor
Company.

      (b) If, in connection with a Company Transaction, the Successor Company
refuses to assume or substitute for an Option, then each such outstanding Option
shall become fully vested and exercisable.  In such case, the Plan Administrator
shall notify the Participant in writing or electronically that the Option shall
be fully vested and exercisable for a specified time period.  At the expiration
of such time period, the Option shall terminate, provided that the Company
Transaction has occurred.

      (c) For the purposes of this Section 12.3, the Option shall be considered
assumed or substituted for if following the Company Transaction the option or
right confers the right to purchase or receive, for each share of Common Stock
subject to the Option immediately prior to the Company Transaction, the
consideration (whether stock, cash, or other securities or property) received in
the Company Transaction by holders of Common Stock for each share held on the
effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding shares); provided, however, that if such consideration received
in the Company Transaction is not solely common stock of the Successor Company,
the Plan Administrator may, with the consent of the Successor Company, provide
for the consideration to be received upon the exercise of the Option, for each
share of Common Stock subject thereto, to be solely common stock of the
Successor Company substantially equal in fair market value to the per share
consideration received by holders of Common Stock in the Company Transaction.
The determination of such substantial equality of value of consideration shall
be made by the Plan Administrator and its determination shall be conclusive and
binding.

      (d) All Options shall terminate and cease to remain outstanding
immediately following the Company Transaction, except to the extent assumed by
the Successor Company.

      12.3.2  Stock Awards

      In the event of a Company Transaction, except as otherwise provided in the
instrument evidencing the Award and unless otherwise provided in a written
employment or services agreement between the Participant and the Company or a
Related Company, the vesting of shares subject to Stock Awards shall accelerate,
and the forfeiture provisions to which such shares are subject shall lapse, if
and to the same extent that the vesting of

                                      -14-
<PAGE>

outstanding Options accelerates in connection with the Company Transaction. If
unvested Options are to be assumed or substituted by a Successor Company without
acceleration upon the occurrence of a Company Transaction, the repurchase or
forfeiture provisions to which such Stock Awards are subject shall continue with
respect to shares of the Successor Company that may be issued in exchange for
such shares.

      12.3.3  Acceleration

      Except as otherwise provided in the instrument evidencing the Award or in
a written employment or services agreement between the Participant and the
Company or a Related Company, any Awards held by employees that are assumed or
substituted in a Company Transaction and do not otherwise accelerate at that
time shall automatically become fully vested and exercisable with respect to
100% of the unvested portion of the Award (and any forfeiture or repurchase
provisions applicable to Stock Awards shall lapse to the same extent) in the
event a Participant's employment is terminated within one year following such
Company Transaction, unless such employment is terminated by the Successor
Company for Cause.

12.4  Further Adjustment of Awards

      Subject to Sections 12.2 and 12.3, the Plan Administrator shall have the
discretion, exercisable at any time before a sale, merger, consolidation,
reorganization, liquidation, dissolution or change of control of the Company, as
defined by the Plan Administrator, to take such further action as it determines
to be necessary or advisable with respect to Awards.  Such authorized action may
include (but shall not be limited to) establishing, amending or waiving the
type, terms, conditions or duration of, or restrictions on, Awards so as to
provide for earlier, later, extended or additional time for exercise, lifting
restrictions and other modifications, and the Plan Administrator may take such
actions with respect to all Participants, to certain categories of Participants
or only to individual Participants.  The Plan Administrator may take such action
before or after granting Awards to which the action relates and before or after
any public announcement with respect to such sale, merger, consolidation,
reorganization, liquidation, dissolution or change of control that is the reason
for such action.

12.5  Limitations

      The grant of Awards shall in no way affect the Company's right to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part
of its business or assets.

12.6  Fractional Shares

      In the event of any adjustment in the number of shares covered by any
Award, each such Award shall cover only the number of full shares resulting from
such adjustment.

                                      -15-
<PAGE>

                         SECTION 13.  MARKET STANDOFF

      In the event of an underwritten public offering by the Company of its
equity securities pursuant to an effective registration statement filed under
the Securities Act, including the Company's initial public offering, no person
may sell, make any short sale of, loan, hypothecate, pledge, grant any option
for the purchase of, or otherwise dispose of or transfer for value or otherwise
agree to engage in any of the foregoing transactions with respect to any shares
issued pursuant to an Award granted under the Plan without the prior written
consent of the Company or its underwriters.  Such limitations shall be in effect
for such period of time as may be requested by the Company or such underwriters;
provided, however, that in no event shall such period exceed 180 days.  The
limitations of this Section 13 shall in all events terminate two years after the
effective date of the Company's initial public offering.

      In the event of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
Company's outstanding Common Stock effected as a class without the Company's
receipt of consideration, any new, substituted or additional securities
distributed with respect to the purchased shares shall be immediately subject to
the provisions of this Section 13, to the same extent the purchased shares are
at such time covered by such provisions.

      In order to enforce the limitations of this Section 13, the Company may
impose stop-transfer instructions with respect to the purchased shares until the
end of the applicable standoff period.

                    SECTION 14.  AMENDMENT AND TERMINATION

14.1  Amendment, Suspension or Termination of Plan

      The Board may amend, suspend or terminate the Plan or any portion of the
Plan at any time and in such respects as it shall deem advisable; provided,
however, that to the extent required for compliance with Section 422 of the Code
or any applicable law or regulation, shareholder approval shall be required for
any amendment that would (a) increase the total number of shares available for
issuance under the Plan, (b) modify the class of employees eligible to receive
Options, or (c) otherwise require shareholder approval under any applicable law
or regulation.  Any amendment made to the Plan that would constitute a
"modification" to Incentive Stock Options outstanding on the date of such
amendment shall not, without the consent of the Participant, be applicable to
such outstanding Incentive Stock Options but shall have prospective effect only.

14.2  Term of Plan

      Unless sooner terminated as provided herein, the Plan shall terminate ten
years after the earlier of the Plan's adoption by the Board and approval by the
shareholders.

                                      -16-
<PAGE>

14.3  Consent of Participant

      The suspension, amendment or termination of the Plan or a portion thereof
or the amendment of an outstanding Award shall not, without the Participant's
consent, materially adversely affect any rights under any Award theretofore
granted to the Participant under the Plan.  Any change or adjustment to an
outstanding Incentive Stock Option shall not, without the consent of the
Participant, be made in a manner so as to constitute a "modification" that would
cause such Incentive Stock Option to fail to continue to qualify as an Incentive
Stock Option.  Notwithstanding the foregoing, any adjustments made pursuant to
Sections 12.1 through 12.3 shall not be subject to these restrictions.

                             SECTION 15.  GENERAL

15.1  Evidence of Awards

      Awards granted under the Plan shall be evidenced by a written instrument
that shall contain such terms, conditions, limitations and restrictions as the
Plan Administrator shall deem advisable and that are not inconsistent with the
Plan.

15.2  No Individual Rights

      Nothing in the Plan or any Award granted under the Plan shall be deemed to
constitute an employment contract or confer or be deemed to confer on any
Participant any right to continue in the employ of, or to continue any other
relationship with, the Company or any Related Company or limit in any way the
right of the Company or any Related Company to terminate a Participant's
employment or other relationship at any time, with or without Cause.

15.3  No Implied Rights or Obligations

      No Participant shall, by reason of participation in the Plan, acquire any
right in or title to any assets, funds or property of the Company or any Related
Company whatsoever including without limitation, any specific funds, assets or
other property which the Company or any Related Company, in its sole discretion,
may set aside in anticipation of a liability under the Plan.  Subject to the
terms of the Plan, a Participant shall have only a contractual right to the
shares of Common Stock or amounts, if any, payable under the Plan, unsecured by
any assets of the Company or any Related Company, and nothing contained in the
Plan shall constitute a representation or guarantee that the assets of the
Company or any Related Company shall be sufficient to pay any benefits to any
person.

      The Company, in establishing and maintaining this Plan as a voluntary and
unilateral undertaking, expressly disavows the creation of any rights in
Participants or others claiming entitlement under the Plan or any obligations on
the part of the Company, any Related Company or the Plan Administrator, except
as expressly provided herein.  In particular,

                                      -17-
<PAGE>

except as permitted by Section 11, no third-party beneficiary rights shall be
created under the Plan.

      Without limiting the generality of the foregoing, the Company disavows any
undertaking to assure the tax treatment of any particular Award, including the
deferral or transfer of any Award benefits, as may be permitted by the Plan
Administrator.

15.4  Issuance of Shares

      Notwithstanding any other provision of the Plan, the Company shall have no
obligation to issue or deliver any shares of Common Stock under the Plan or make
any other distribution of benefits under the Plan unless, in the opinion of the
Company's counsel, such issuance, delivery or distribution would comply with all
applicable laws (including, without limitation, the requirements of the
Securities Act or the laws of any state or foreign jurisdiction), and the
applicable requirements of any securities exchange or similar entity.

      The Company shall be under no obligation to any Participant to register
for offering or resale or to qualify for exemption under the Securities Act, or
to register or qualify under the laws of any state or foreign jurisdiction, any
shares of Common Stock, security or interest in a security paid or issued under,
or created by, the Plan, or to continue in effect any such registrations or
qualifications if made. The Company may issue certificates for shares with such
legends and subject to such restrictions on transfer and stop-transfer
instructions as counsel for the Company deems necessary or desirable for
compliance by the Company with federal, state and foreign securities laws.

      To the extent the Plan or any instrument evidencing an Award provides for
issuance of stock certificates to reflect the issuance of shares of Common
Stock, the issuance may be effected on a noncertificated basis, to the extent
not prohibited by applicable law or the applicable rules of any stock exchange.

15.5  No Rights as a Shareholder

      No Option or Stock Award denominated in units shall entitle the
Participant to any cash dividend, voting or other right of a shareholder unless
and until the date of issuance under the Plan of the shares that are the subject
of such Award.

15.6  Compliance With Laws and Regulations

      Notwithstanding anything in the Plan to the contrary, the Plan
Administrator, in its sole discretion, may bifurcate the Plan so as to restrict,
limit or condition the use of any provision of the Plan to Participants who are
officers or directors subject to Section 16 of the Exchange Act without so
restricting, limiting or conditioning the Plan with respect to other
Participants.  Additionally, in interpreting and applying the provisions of the
Plan, any Option granted as an Incentive Stock Option pursuant to the Plan
shall, to the extent permitted by

                                      -18-
<PAGE>

law, be construed as an "incentive stock option" within the meaning of Section
422 of the Code.

15.7   Participants in Other Countries

       The Plan Administrator shall have the authority to adopt such
modifications, procedures and subplans as may be necessary or desirable to
comply with provisions of the laws of other countries in which the Company or
any Related Company may operate to assure the viability of the benefits from
Awards granted to Participants employed in such countries and to meet the
objectives of the Plan.

15.8   No Trust or Fund

       The Plan is intended to constitute an "unfunded" plan.  Nothing contained
herein shall require the Company to segregate any monies or other property, or
shares of Common Stock, or to create any trusts, or to make any special deposits
for any immediate or deferred amounts payable to any Participant, and no
Participant shall have any rights that are greater than those of a general
unsecured creditor of the Company.

15.9   Severability

       If any provision of the Plan or any Award is determined to be invalid,
illegal or unenforceable in any jurisdiction, or as to any person, or would
disqualify the Plan or any Award under any law deemed applicable by the Plan
Administrator, such provision shall be construed or deemed amended to conform to
applicable laws, or, if it cannot be so construed or deemed amended without, in
the Plan Administrator's determination, materially altering the intent of the
Plan or the Award, such provision shall be stricken as to such jurisdiction,
person or Award, and the remainder of the Plan and any such Award shall remain
in full force and effect.

15.10  Choice of Law

       The Plan and all determinations made and actions taken pursuant hereto,
to the extent not otherwise governed by the laws of the United States, shall be
governed by the laws of the State of Washington without giving effect to
principles of conflicts of law.

                          SECTION 16.  EFFECTIVE DATE

       The effective date of the Plan is the date on which the Board adopts the
Plan, subject to effectiveness of the initial registration of the Common Stock
under Section 12(b) or 12(g) of the Exchange Act.  If the shareholders of the
Company do not approve the Plan within 12 months after the Board adopts the
Plan, any Incentive Stock Options granted under the Plan will be treated as
Nonqualified Stock Options.

                                      -19-
<PAGE>

     Adopted by the Board on  __________, _____ , and approved by the Company's
shareholders on  __________, _____.

                                      -20-
<PAGE>

                   PLAN ADOPTION AND AMENDMENTS/ADJUSTMENTS
                                 SUMMARY PAGE

<TABLE>
<CAPTION>
     Date of Board                                      Section/Effect           Date of Shareholder
        Action                    Action                 of Amendment                  Approval
    <S>                      <C>                        <C>                      <C>
    ___________, 2001        Initial Plan Adoption                                  ___________, 200_
</TABLE>

                                      R-1<PAGE>

                                                                   EXHIBIT 10.30

                           STOCK OPTION GRANT PROGRAM
                                      FOR
                        NONEMPLOYEE DIRECTORS UNDER THE
                     ZYMOGENETICS 2001 STOCK INCENTIVE PLAN

     The following provisions set forth the terms of the stock option grant
program (the "Program") for nonemployee directors of ZymoGenetics, Inc. (the
"Company") under the Company's 2001 Stock Incentive Plan (the "Plan"). The
following terms are intended to supplement, not alter or change, the provisions
of the Plan, and in the event of any inconsistency between the terms contained
herein and in the Plan, the Plan shall govern. All capitalized terms that are
not defined herein shall be as defined in the Plan.

     1.   Eligibility

     Each director of the Company who is not otherwise an employee of the
Company or any Related Company (an "Eligible Director") shall be eligible to
receive grants under the Plan, as discussed below.

     2.   Initial Grants

     (a)  Each Eligible Director who is first elected or appointed to the Board
after the closing date of an underwritten initial public offering of the
Company's Common Stock (the "IPO"), other than an Eligible Director elected or
appointed pursuant to Section 4.3 of the Shareholders' Agreement dated as of
November 10, 2000 among the Company and certain investors, shall automatically
be granted as of the date of such initial election or appointment a Nonqualified
Stock Option to purchase that number of shares of Common Stock calculated by
dividing $250,000 by the Common Stock's Fair Market Value on the Grant Date (the
"Initial Grant").

     (b)  Initial Grants shall vest and become exercisable at the next annual
meeting of shareholders (the "Annual Meeting"), assuming continued service on
the Board for such period; provided, however, that with respect to any Initial
Grant made within five months before an Annual Meeting, the Option shall not
become vested and exercisable until the second Annual Meeting after the date of
such Initial Grant.

     3.   Annual Grants

     (a)  Commencing with the first Annual Meeting following the closing of the
Company's initial public offering and immediately following each year's Annual
Meeting thereafter, each Eligible Director shall automatically receive a
Nonqualified Stock Option to purchase that number of shares of Common Stock
calculated by dividing $100,000 by the Common Stock's Fair Market Value on the
Grant Date (each, an "Annual Grant"); provided that any Eligible Director who
received an Initial Grant within five months before an Annual Meeting
<PAGE>

shall not receive an Annual Grant until immediately following the second Annual
Meeting after the date of such Initial Grant.

     (b)   Such Annual Grants shall fully vest and become exercisable on the
next Annual Meeting, assuming continued service on the Board for such period.

     4.    Option Exercise Price

     The exercise price of an Option shall be the Fair Market Value of the
Common Stock on the Grant Date.

     5.    Manner of Option Exercise

     An Option shall be exercised by giving the required notice to the Company,
stating the number of shares of Common Stock with respect to which the Option is
being exercised, accompanied by payment in full for such Common Stock, which
payment may be in whole or in part (a) in cash or check, (b) in shares of Common
Stock, owned by the Eligible Director for at least six months (or any shorter
period necessary to avoid a charge to the Company's earnings for financial
reporting purposes) having a Fair Market Value on the day prior to the exercise
date equal to the aggregate Option exercise price, or (c) if and so long as the
Common Stock is registered under the Exchange Act, by delivery of a properly
executed exercise notice, together with irrevocable instructions to a broker, to
properly deliver to the Company the amount of sale or loan proceeds to pay the
exercise price, all in accordance with the regulations of the Federal Reserve
Board.

     6.    Term of Options

     Each Option shall expire ten years from the Grant Date thereof, but shall
be subject to earlier termination as follows:

     (a)   In the event that an Eligible Director ceases to be a director of the
Company for any reason other than the death of the Eligible Director, the
unvested portion of any Option granted to such Eligible Director shall terminate
immediately and the vested portion of the Option may be exercised by the
Eligible Director only within one year after the date he or she ceases to be a
director of the Company or prior to the date on which the Option expires by its
terms, whichever is earlier.

     (b)   In the event of the death of an Eligible Director, the unvested
portion of any Option granted to such Eligible Director shall terminate
immediately and the vested portion of the Option may be exercised only within
one year after the date of death of the Eligible Director or prior to the date
on which the Option expires by its terms, whichever is earlier, by the personal
representative of the Eligible Director's estate, the person(s) to whom the
Eligible Director's rights under the Option have passed by will or the
applicable laws of descent and distribution or the beneficiary designated
pursuant to Section 11 of the Plan.

                                      -2-
<PAGE>

     7.    Company Transactions

     In the event of any Company Transaction, other than a Related Party
Transaction, each Initial and Annual Grant that is at the time outstanding shall
automatically accelerate so that each such grant shall, immediately prior to the
specified effective date for the Company Transaction, become fully vested and
exercisable.  Such Options shall terminate and no longer be exercisable to the
extent that they are not exercised prior to the Company Transaction.

     8.    Amendment

     The Board may amend the provisions contained herein in such respects as it
deems advisable.  Any such amendment shall not, without the consent of the
Eligible Director, impair or diminish any rights of an Eligible Director or any
rights of the Company under an Option.

     Provisions of the Plan (including any amendments) that were not discussed
above, to the extent applicable to Eligible Directors shall continue to govern
the terms and conditions of Options granted to Eligible Directors.

     9.    Effective Date

     The Program shall become effective on the closing of the Company's IPO.

                                      -3-

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