The meeting was called by US Ambassador Douglas McElhaney. It was agreed that the Presidency's one president and two vice presidents, rotating every 16 months, will be elected indirectly in parliament instead of by direct vote among the electorate as until now.
US Secretary of State Condoleezza Rice will be notified of the agreement by a special letter, reporters were told.
As of October, Bosnia's president and two vice presidents will be nominated by deputies in the House of Peoples and the House of Representatives.
All 87 deputies on the state level elected directly are candidates for the Presidency, the president of Bosnia's Croatian Democratic Union (HDZ BH), Dragan Covic, told the press, adding that 20 per cent of House of Peoples deputies or 10 per cent of the House of Representatives could nominate one member.
After the nominations, the upper house elects one representative each from all three constituent peoples (Croats, Muslims, Serbs), who are then confirmed by the lower house, said Covic.
He now has to assure his party to vote for the reforms given that previously deputies said they would not vote for the changes in their existing form.
This model acknowledges a recommendation from the Venice Commission, a Council of Europe advisory body, but also objections from Croat parties which insisted on a model that would guarantee Bosnian Croats the right to elect their representative in the state Presidency.
Bosnian Serb parties (SNSD, PDP, SDS) said their parliamentary deputies would support the reforms.
Haris Silajdzic's Party for Bosnia and Herzegovina is the only significant party openly against the reforms.
The participants in today's meeting also agreed to establish two new state ministries, increase the number of deputies in the state parliament, reduce the role of the upper house, and transfer additional powers from entity to state bodies.