Ousted President Manuel Zelaya said he will head to Nicaragua's northern border Thursday and cross over into Honduras the next day after internationally mediated talks failed to return him to power. Zelaya, who was toppled and flown out of the country in a June 28 military coup, said US-backed talks mediated by Costa Rican President Oscar Arias failed because "the coup leaders totally refuse to reinstate me." "I will go back unarmed, pacifically so that Honduras can return to peace and tranquility," Zelaya said at a news conference late Wednesday in the Nicaraguan capital, Managua. "My wife and kids will accompany me and the military will be responsible for any harm" that befalls them. He said he would go to Nicaragua's border and cross over by land into Honduras on Friday. The Honduran military thwarted Zelaya's first attempt to return home July 5 by blocking the runway at the airport in the capital, Tegucigalpa. The flight sparked clashes between Zelaya's supporters and security forces at the airport and left at least one person dead. In Costa Rica, talks on resolving the standoff generated by the coup headed toward failure Wednesday when the interim government of Roberto Micheletti indicated it would reject Arias' final proposal for resolving the crisis. Arias presented an 11-point plan that called for Zelaya's return to the presidency in two days and offered amnesty for the coup leaders that ousted him. Arias said the plan was his last attempt at mediating a peaceful solution. He said Zelaya and the interim government should turn to the Organization of American States for a new mediator if they refused to sign the agreement. Arias warned both sides that time was running out for a peaceful solution and urged them to set an example by becoming the first country in modern history to reverse a coup through a negotiated agreement. "The clock is ticking fast, and it's ticking against the Honduran people," Arias said in Costa Rica's capital, San Jose. "I warn you that this plan is not perfect. Nothing in democracy is perfect." Mauricio Villeda, a member of interim President Roberto Micheletti's delegation at the talks, said he would take the proposals back to Honduras to present to the president, congress and the Supreme Court for consideration. But Micheletti's foreign minister, Carlos Lopez, flatly rejected putting Zelaya back in the presidency, saying the executive branch cannot overturn a Supreme Court ruling forbidding the reinstatement of the ousted leader. "A proposal of that nature is inconceivable, unacceptable," Lopez told Radio America. Micheletti's refusal to budge came despite stepped up pressure from the United States and other nations, which warned of tough sanctions unless Zelaya is restored. Rixi Moncada, of Zelaya's delegation, called the mediation effort a failure and urged the United Nations and the OAS to "adopt the coercive measures necessary to force the interim government to submit" to the resolutions that both organizations adopted demanding the return of Zelaya. "The mediation had only one goal: to enforce the mandate of the OAS and restore the constitutional order in Honduras with the return of President Manuel Zelaya," Moncada said. "That is why, for us, the accord of San Jose has failed." Zelaya's has repeatedly vowed to return to Honduran to reclaim the presidency and seek the prosecution of leaders of the coup that forced him into exile. Arias' final plan was similar to an earlier proposal that Micheletti rejected. It included a timetable that would return Zelaya to Honduras by Friday to carry out the rest of his four-year term, which ends in January, under a power-sharing government. The plan also would require Zelaya to drop efforts to change the Honduran constitution, an initiative that provoked his ouster. Zelaya angered many people in Honduras by ignoring Congress' and the courts' rejection of his push to hold a referendum on changing the constitution, which many saw as an attempt to abolish presidential term limits and impose a socialist government in the style of his ally, Venezuela President Hugo Chavez. The reconciliation plan would provide Zelaya immunity from prosecution for trying to hold the referendum, along with amnesty for coup leaders. Arias said he included several new points, including some proposed by the interim government with the help of a U.S. senator, who was not identified. Among the new ideas was a truth commission to investigate the events leading up to the coup. Tens of thousands of Micheletti's supporters rallied in the Honduran capital Wednesday in one of the biggest demonstrations seen yet. They accused Zelaya of being a pawn of Chavez, exchanging shouts and insults with Zelaya supporters. No foreign government has recognized the Micheletti administration. US State Department spokesman Robert Wood, speaking to reporters in Washington, said Secretary of State Hillary Clinton warned Micheletti's government in a phone call over the weekend. US officials are considering sanctions and the European Union has already frozen â‚¬65 million ($92 million) in development aid and warned of further steps. "The secretary of state made very clear that Mr. Micheletti, the de facto regime, needs to take this mediation effort seriously and respond appropriately," Wood said. "Should that not happen, there are clear consequences with regard to our assistance to Honduras."