A mortar barrage pounded a neighborhood near the enclave holding the U.S. Embassy and Iraqi government offices Tuesday, killing an Iraqi garbage collector as he was making his morning rounds and wounding 14 U.S. soldiers.

Despite the violence, Iraq took a step toward democracy, announcing hours later that a national conference to choose an interim assembly would begin Saturday. Coalition troops and interior ministry forces will assist authorities in protecting the event, to be attended by 1,000 delegates.

The three-day conference, stipulated under a law enacted by the former U.S. occupation authority, was to have been concluded by the end of July, but it had to be delayed because preparations were behind schedule, conference chair Fuad Masoum said.

"There was an idea put forward by the United Nations (search) to delay the conference because of a lack of preparation, from technical and other perspectives," Masoum said. "We don't want to go ahead without the U.N."

The conference is beset with difficulties, with some local leaders unable to agree on delegates and some important factions threatening to boycott. The gathering will help create an interim assembly intended to help prepare for elections next year that many hope will bring order to a country wracked by a persistent insurgency.

The violence pushed a Jordanian company working for the U.S. military here to announce it was withdrawing from Iraq to secure the release of two Jordanian employees kidnapped by militants.

Fayez Saad al-Udwan and Mohammad Ahmed Salama Hussein al-Manaya'a were abducted Monday by a group calling itself the Mujahedeen Corps in Iraq. The group warned the Jordanians would be killed within 72 hours unless their employer pulled out of the country and stopped cooperating with U.S forces.

The decision by Daoud and Partners — a private company providing construction and catering services to the U.S. military — came hours after al-Manaya'a's father threatened to "chop off the head" of the firm's chief executive if he did not comply.

Militants have kidnapped more than 70 foreigners, mainly truck drivers, in recent months as part of the 15-month-old insurgency targeting members of the U.S.-led coalition and foreign companies working here.

One of the most prominent hostages, Egyptian diplomat Mohammed Mamdouh Helmi Qutb (search), returned to work Tuesday, a day after being released by militants who seized him Friday outside a mosque.

"At the beginning, when they kidnapped me, they threatened to kill me if I troubled them in any way, but they later apologized and gave me presents, including a dagger and prayer beads," Qutb told reporters at the Egyptian mission in Baghdad.

The U.S. State Department (search) said Tuesday that Egypt made no concessions to gain the release of the diplomat and remains steadfast against militant Islamic terror.

At the same time, the department implicitly criticized the Jordanian firm for saying it would pull out of Iraq if militants would release its two kidnapped employees.

"This was, obviously, a difficult decision, and one that the directors of this company felt they had to take," department spokesman Adam J. Ereli said. But, he said, "Our views are well-known. We do not make concessions to terrorists, and we do not feel that this is the best way to fight terror."

Early Tuesday, four to five mortar rounds landed near Baghdad's Green Zone (search), the former home to the U.S. occupation authority and current site of Iraq's interim government and the U.S. and British embassies.

One hit Salhiya, a nearby neighborhood, killing one garbage collector as he cleared trash and wounding another, residents said.

"This poor guy was just doing his job and he has been killed by a mortar ... intended for the coalition," Muthana Joma Hassoun said.

The mortar fire also wounded 14 U.S. soldiers, 11 of whom later returned to duty.

In a further effort to impede the coalition forces and damage reconstruction efforts, a militant group calling itself the "Group of Death" threatened Tuesday to cut off the main highway linking Iraq to Jordan, a major supply route.

In a video, the masked gunmen gave a 72-hour deadline before they would cut the road and also threatened to attack Jordanian interests, accusing Iraq's neighbor of supporting American and South Korean military efforts in Iraq.

In other violence, gunmen assassinated the assistant director of Mahmoudiya Hospital, about 25 miles south of Baghdad, the hospital's chief said Tuesday.

Assailants in a car shot Dr. Qassem el-Obaidi as he was driving home from work late Monday, hospital director Dr. Daoud al-Ta'i said.

In the city of Baqouba, a suicide bomber blew up a car but did not cause any other casualties, Iraqi officials said. Associated Press Television News footage showed mangled wreckage of the car and the bomber's dismembered body.

Also Tuesday, Iraqi police arrested two people driving a truck filled with 1,000 mortars and 250 anti-tank mines near the city of Kut, south of Baghdad, said police Col. Ali Ribih Najim.

Marines stopped a pickup truck filled with 219 mortar rounds in bags of grain at a checkpoint Monday, the military said. The discovery was the largest cache of mortars seized by Marines since taking charge of Anbar Province in March.

"This find is significant ... since roughly 40 percent of the indirect fire attacks within the Al Anbar Province are mortar related," a military statement said.