Since then, the country has become increasingly isolated as foreign governments have halted aid and sporadic violence has broken out.
The composition of the transition government - which is set to include a president, vice-president, prime minister and three deputy prime minister - is still to be decided.
"They will reflect on it and make a decision later," Joaquim Chissano, the former Mozambican leader who led the talks, said.
Al Jazeera's Haru Mutasa, reporting from the Mozambican capital, Maputo, said it was still unclear how the rivals would be represented in the transitional government.
"You have two men - Ravalomanana and Rajoelina - who are bitter enemies ... can they put aside their differences for the good of Madagascar?" she asked.
"The army [also] plays a big, big role ... If the army does not buy into this agreement then it could threaten the stability of Madagascar and the future prospects of this transition deal."
Ravalomanana said that although his party would be represented in the transitional administration, he would not have an official role.
"In the interests of the nation, and following consultations, it seems reasonable to me to not participate personally in the transition," he said.
Under the terms of the accord members of the transition government may not run in the elections, expect for its president.
Ravalomanana said however that he would return home to Madagascar from South Africa under the terms of the deal, which grants him an amnesty, although he said he would wait until "the situation is favourable".
The amnesty quashes his corruption conviction, but does not cover any potential charges relating to war crimes, crimes and against humanity, and violations of human rights.
The talks also settled the issue of amnesty for Didier Ratsiraka, a former president and powerbroker. He has been in exile in France since the results of the 2001 presidential election against Ravolamanana were disputed.
He was sentenced to four years in prison in June after being tried in absentia for a "conflict of interest" in the purchase of a presidential aircraft.
In 2003, Ratsiraka was convicted of misusing public funds and threatening state security. He was sentenced to 10 years of forced labour and five years in prison.
The mediation team includes officials from the African Union, United Nations, the International Organisation of the Francophonie (French-speaking countries) and the Southern African Development Community (Sadc).