The agreement also calls on Hadi to shake up a commission tasked with writing a draft constitution to ensure bigger representation for the Houthis.
The draft constitution has proposed a federation of six regions — something the Houthis reject. The agreement reached Wednesday night also ensures that Yemen would be a federal state, but doesn't mention the six-region proposal, saying controversial issues will be further discussed.
The agreement, while addressing the immediate Houthi takeover and security concerns in the capital, leaves the contentious political issues unresolved.
The Houthis, who took control of the capital in September, say they only want an equal share of power, while critics say that they prefer the presence of Hadi as a symbolic leader while they keep a grip on power. Critics also say the Houthis are backed by Shia power Iran, something they deny.
The increasingly weakened leadership and power vacuum are setting the stage for Al-Qaeda in Yemen, which claimed the recent attack on the French satirical newspaper Charlie Hebdo and failed assaults on the U.S. homeland, to grow more powerful in the chaos.
Aides to Hadi had said earlier Wednesday that he was "captive" in his home. Soon after the agreement Wednesday night, there was no visible change in Houthi deployment outside Hadi's house.
The Associated Press