LightSquared Inc.'s chief executive and an executive vice president stepped down in the wake of a regulatory setback that has forced the wireless venture to rethink its multibillion-dollar strategy to roll out a new fourth-generation network.

Sanjiv Ahuja left the CEO post this month after working without a contract since July, according to people familiar with the situation. Martin Harriman, the executive vice president of ecosystem development and satellite business will also leave the company, said one of the people. Ahuja will remain chairman and billionaire Philip Falcone, whose Harbinger Capital Partners hedge fund is LightSquared's principal backer, will join the board to assist in the search for a new CEO.

LightSquared faces an uncertain future. The Federal Communications Commission this month said it would revoke a waiver that would allow the company to use satellite airwaves for a terrestrial network, citing concerns the network may interfere with Global Positioning System signals. The company received the conditional FCC waiver last year and hoped to compete with AT&T Inc. (T), Verizon Wireless and others in selling wireless airwaves, or spectrum, wholesale to wireless carriers.

The company has said it is the victim of biased testing and said GPS device manufacturers should be required to pay for filters to protect their equipment from signal interference. In the meantime, it is considering a plan to swap its spectrum with some held by the Defense Department as a last-ditch effort to resolve the GPS interference concerns.

Chief Network Officer Doug Smith and Chief Financial Officer Marc Montagner were named interim co-chief operating officers as LightSquared undertakes the search for a new CEO.

A spokesman for LightSquared declined to comment on whom the company was considering for the position. The company's board of directors will meet on Thursday to discuss CEO candidates, among other matters, two people said.

Separately, several Republican members of the House Energy & Commerce committee wrote Tuesday to the FCC, Defense Department and other agencies seeking internal documents, such as test results and communications with LightSquared, as part of a "comprehensive review" of how Falcone's wireless startup was handled.

This month, Harbinger cut nearly half of its workforce and now employs fewer than 200 people.

Harbinger last year told investors that it lost 47% of the value in its biggest fund because of a markdown in the value of LightSquared. The losses helped cause Harbinger's firm-wide assets to plunge to $4 billion, from a high of $26 billion in 2008. Investors have been barred from pulling their money from Harbinger for months.

Harbinger, of New York, also is facing a lawsuit from investors seeking a return of funds they lost as a result of the LightSquared investment.

The company last year signed a 15-year accord with Sprint Nextel Corp. (S) to share the costs of building their respective 4G LTE networks, an arrangement LightSquared estimated could save it as much as $13 billion through the end of the decade. Sprint has the right to terminate the agreement as soon as March 16 if LightSquared cannot get final approval to operate its network, though it would have to return at least $65 million in prepayments.

LightSquared has said it has enough money to operate for several quarters, though it hasn't given specifics.

-By Greg Bensinger, Dow Jones Newswires; 212-416-4676; greg.bensinger@dowjones.com

--Nathalie Tadena contributed to this article.

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