The proposal, rolled out at the Statehouse, would grant new protections for LGBT customers, employees and tenants.

“What was intended as a message of inclusion was interpreted as a message of exclusion, especially for the LGBT community,” Indiana House Speaker Brian Bosma told reporters at the Statehouse. “Nothing could have been further from the truth, but it was clear the perception had to be addressed.”

“Hoosiers value gays, straights, blacks, whites, religious and nonreligious,” Bosma said. “We value each and every Hoosier.”

Senate President Pro Tem David Long, in unveiling the revised law, said it will “unequivocably state that Indiana’s (religious freedom) law does not and will not be able to discriminate against anyone, anywhere at any time.”

The amendment means that for the first time an Indiana law will include the language “sexual orientation” and “gender identity.”

The revised law could potentially quell concerns that have made Indiana the focus of national derision for one very intense week.

“It was never intended to discriminate against anyone,” Long said. “That perception led to the national protests we’ve seen.”

Former Indianapolis mayor and Democrat Bart Peterson said the words “gender identity” and “sexual orientation” will appear in state law in context of anti-discrimination for first time. “The healing needs to begin right now,” said Peterson, an executive at Indianapolis-based Eli Lilly and Co.

Long and Bosma spent 90 minutes meeting late Wednesday evening discussing the deal with top staff and Gov. Mike Pence’s chief of staff, Jim Atterholt.

Atterholt did not say whether Pence would sign the compromise measure. He said Pence still needed to review the plan.

The deal was hammered out in private between Bosma, Long, Atterholt and a small handful of business leaders, including Republican powerbroker and Indianapolis Motor Speedway CEO Mark Miles, throughout the day Tuesday and Wednesday.

The measure could put to rest some of the harsher criticisms that Indiana Republicans have suffered through in the past week. But it is unlikely to make either liberal or conservative activists happy.

A copy of proposed language was presented to Pence Wednesday morning. It was then the subject of negotiations among the Republican leaders, lawmakers and business leaders in private meetings throughout the day.

The compromise legislation specifies that the new religious freedom law cannot be used as a legal defense to discriminate against patrons based on their sexual orientation or gender identity.

The proposal goes much further than a “preamble” that was proposed earlier in the week, and, if it stands, would be the first time any protections against discrimination have been extended to gays and lesbians in state law. But it doesn’t go as far as establishing gays and lesbians as a protected class of citizens statewide or repealing the law outright, both things that Republican leaders have said they could not support.

A draft circulated said the new “religious freedom” law does not authorize a provider — including businesses or individuals — to refuse to offer or provide its services, facilities, goods, or public accommodation to any member of the public based on sexual orientation or gender identity, in addition to race, color, religion, ancestry, age, national origin, disability, sex, or military service.

The proposed language exempts churches or other nonprofit religious organizations — including affiliated schools — from the definition of “provider.” Later Wednesday, additional language was added to include protections in housing and employment.

The clarifying language is likely to rile socially conservative advocacy groups, which hold significant sway among Republicans at the Statehouse and pushed hard for the religious freedom law after a failed legislative effort last year to enshrine a same-sex marriage ban in the state constitution.

Leaders of three of those groups — the American Family Association of Indiana, the Indiana Family Institute, and Advance America — declined comment or did not return calls for comment. But in an email update to supporters from the AFA’s Micah Clark, he urged them to contact their state senators and to pray for legislators.

“At this very moment, the Indiana Senate is considering ‘water-down’ language to the recently passed and pro-religious-liberty bill, Religious Freedom Restoration Act,” the email says. “Homosexual activists are demanding Christian business owners in Indiana be forced to compromise their faith.”

At the same time, opponents of the law argued the clarification being discussed does not go far enough.

Katie Blair, campaign manager for Freedom Indiana, said in a statement Wednesday that the draft bill should include a guarantee that the RFRA “cannot be used to undermine any nondiscrimination protections,”

The prospect of the clarifying language also failed to prevent the Christian Church (Disciples of Christ) from following through Wednesday on its threat of relocating its 6,000-person 2017 convention from Indianapolis because of the new law.

It has been threats from business leaders and financial institutions that caused the most worry at the Statehouse, ultimately spurring Republican leaders to reconsider a measure they never believed authorized discrimination.

Earlier in the day Wednesday, the California Endowment, one of the largest health foundations in the nation, sent letters to three Indiana companies — Eli Lilly and Co., Anthem Inc. and Berry Plastics Group — warning of possible dis-investment in their stock if the new Indiana religious freedom law stays on the books unaltered.

Statehouse Democrats continued to call for a repeal of the law and full statewide protections against discrimination of gays and lesbians. It was not clear if Democrats, who are vastly outnumbered in the Statehouse, would go along with the compromise, or if their votes were needed.

The new law prohibits state or local governments from substantially burdening a person’s ability to exercise their religion — unless the government can show that it has a compelling interest and that the action is the least-restrictive means of achieving it. It takes effect July 1.

Although the original law does not mention sexual orientation, opponents feared it could allow business owners to deny services to gays and lesbians for religious reasons.

The law has garnered a national barrage of criticism from top business executives, celebrities and civil rights groups who fear the law could allow discrimination and damage the state’s reputation. Conventions have canceled or threatened to move events that bring millions of dollars into the state. Prominent Indiana business executives have opposed the law, with some companies halting expansion plans and others canceling travel to the state. The NCAA, which is holding the men’s Final Four in Indianapolis this week, has also expressed concerns about the law.