Zelaya appealed for calm on Thursday after some of his supporters were hurt in protests [AFP]

The two sides have been at odds for four months over whether Zelaya should be reinstated before presidential elections due to be held next year.

"I am pleased to announce ... my negotiating team signed an agreement that marks the beginning of the end of the country's political situation," Micheletti said in a statement on Thursday.

"With regard to the most contentious subject in the deal, the possible restitution of Zelaya to the presidency" would be included.

For his part, Zelaya told Radio Globo: "Tomorrow [Friday] will be the day that the plan will be signed to restore democracy to the country."

Micheletti said the agreement would create a power-sharing government and
bind both sides to recognise the November 29 presidential elections.

Congress to decide

Antonio Rivera, a Honduran senator, said the deal does not necessarily mean Zelaya will be reinstated as president.

"Before that, congress is going to ask the opinion of the supreme court, the general attorney and the elections tribunal.

"Micheletti and Zelaya will have to accept the decision."

Zelaya, who was forced from power in June, and Micheletti held talks separately on Thursday with Tom Shannon, the US assistant secretary of state, and Dan Restrepo, Washington's special assistant for Western Hemisphere affairs.

Sticking point

Zelaya remains holed up at the Brazilian embassy in Tegucigalpa after re-entering the country in late September, two months after he was forced from the presidential palace and into exile.

As the US representatives met the Honduran rivals, a rally by hundreds of pro-Zelaya protesters in Tegucigalpa was broken up by police who fired tear gas.

Barack Obama, the US president, faced criticism from human-rights groups who said Washington should do more to pressure Micheletti.

At one point in the crisis, Micheletti ordered restrictions on civil liberties to be imposed, during which time media stations supportive of Zelaya were taken off-air.

The resumption in negotiations on Thursday came a day after Honduras's military-backed government, which is not recognised internationally, lodged legal proceedings against Brazil at the International Court of Justice in The Hague.

The interim government accused Brazil of interfering in Honduras's internal affairs by sheltering Zelaya at its embassy, claims dismissed by the Brazilian government.

"The de facto Honduran government has no legitimacy to lodge a law suit in the International Court of Justice," a spokesman for Brazil's foreign ministry said.

Zelaya was forced from power on June 28, the same day that he planned to hold a non-binding referendum on the constitution that had been declared illegal by the Honduran congress and supreme court.

Opponents of Zelaya say that the public vote was aimed at winning support for an extension to presidential term limits, claims that he has denied.

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