TECHNOLOGY

Tuesday, March 4, 2008

TECHNOLOGY

Vonage May Change Bond Payout

Vonage, the unprofitable Internet phone company, said it may change the terms of $253 million of debt to avert bankruptcy and persuade investors to hold onto the bonds.

Vonage may increase the interest rate on the convertible notes, modify their conversion price or change their maturity date, it said in a regulatory filing. It also may redeem a portion of the notes for cash or issue common stock to some creditors. The bonds can be redeemed as early as Dec. 16. Vonage said in November that it may not be able to honor the notes if investors convert all of them this year.

MORTGAGE FINANCE

Thornburg Missed Margin Calls

Thornburg Mortgage said it had not met a fresh round of margin calls totaling $270 million. The stock nosedived 51 percent, to settle at $4.32.

The new margin calls are the result of difficult market conditions and don't reflect the performance or long-term value of Thornburg's holdings, the company said. It said it can't be sure that it can raise new cash or capital at acceptable prices.

Court Backs Payment Program

A federal court struck down a Bush administration plan to eliminate a down-payment assistance program used by hundreds of thousands of low- and middle-income home buyers.

The program lets nonprofit organizations fund down payments and be reimbursed by the sellers of the homes. The administration sought to ban the program, contending that it leads to higher housing prices and a disproportionate number of foreclosures.

The Department of Housing and Urban Development must reassess the rule it adopted last October, and HUD Secretary Alphonso Jackson will be barred from the discussions, the U.S. District Court in Sacramento held.

EXECUTIVES

Starbucks U.S. Chief Resigns

Starbucks said U.S. division chief Launi Skinner resigned after six months on the job as Howard Schultz reshuffles management after taking over in January. Cliff Burrows, 48, currently president of the Europe, Middle East and Africa region, will take over the position on March 12. Skinner, 43, stepped down to spend more time with her family, Starbucks said. Schultz, who built the Seattle coffee chain into a company with almost 16,000 cafes, has been making management changes in recent months after Starbucks reported its first quarterly drop in U.S. customer visits.

New Managers at Force Protection

Armored vehicle maker Force Protection shuffled management Monday, just three days after telling shareholders it had major accounting problems tied to recording inventory.

Michael Moody was appointed president, chairman and chief executive to replace Gordon McGilton, the chief executive who left at the end of January. Chief Operating Officer Raymond Pollard left the company Monday to pursue other interests. Francis E. Scheuerell Jr. will serve as interim chief financial officer. He replaces Michael Durski, who left Friday.

REGULATORS

Factories to Be Inspected for Dust

Federal inspections will be carried out at hundreds of plants where combustible dust is a workplace hazard, a top safety official said at a sugar refinery where dust is suspected of causing a deadly explosion.

Ed Foulke Jr., assistant secretary of the Occupational Safety and Health Administration, announced the inspections while visiting the Imperial Sugar refinery in Port Wentworth, Ga., where a blast on Feb. 7 killed 12 workers and injured dozens more. OSHA has not completed its investigation of that explosion but is sending letters to 30,000 companies that deal with combustible dust to discuss the dangers, Foulke said.

ENERGY

Duke CEO Proposes Research Fee

The chief executive of Duke Energy, one of the nation's biggest power producers, proposed tacking a fee on all U.S. electricity to pay for research and development into low-carbon technology.

Jim Rogers, who also serves as chairman and president of Duke, said such a program could generate billions of dollars to fund research into renewable energy, nuclear power and cleaner-burning coal projects. A surcharge of three-tenths of a penny on each kilowatt-hour sold, for example, could generate $11 billion annually for research, he said.

TREASURY BILLS

T-bill rates fell to their lowest levels since 2004. The discount rate on three-month Treasury bills auctioned yesterday fell to 1.79 percent from 2.16 percent last week. Rates on six-month bills fell to 1.81 percent from 2.07 percent. The annualized return to investors is 1.823 percent for three-month bills, with a $10,000 bill selling for $9,954.75, and 1.852 percent for a six-month bill selling for $9,908.49. Separately, the Federal Reserve said the average yield for one-year Treasury bills, a popular index for making changes in adjustable-rate mortgages, fell to 1.98 percent last week from 2.1 percent two weeks ago.

Compiled from reports by Washington Post staff writers, the Associated Press and Bloomberg News.