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lightsquaredWholesale wireless network startup LightSquared is in danger of running out of money by the second quarter of 2012.

The information comes from the company’s latest financial statement reviewed by Reuters. The statement indicated that LightSquared might not be able to continue operating unless it can raise additional capital and financing.

LightSquared’s business strategy involves building out a high-speed 4G long-term evolution (LTE) wireless network and leasing it to outside companies. Those companies would then power their devices or run their wireless service on LightSquared’s network. The company, which is funded by Philip Falcone’s $5 billion Harbinger Capital Partners hedge fund, took a $427 million net loss for the first nine months of 2011.

“If the company fails to obtain the necessary financing on a timely basis, the execution of the company’s business strategy could be materially delayed, costs could materially increase or the company may have to discontinue operations or seek a purchaser for the business or assets,” according to the financial statement.

The availability of cash is hardly the only problem that the startup faces. LightSquared’s LTE network operates on a portion of the wireless spectrum that causes interference to GPS. That interference has the potential to interfere with the estimated 500 million GPS-enabled devices and services — like airplane tracking, clock synchronization, weather forecasting, emergency communications and several others that are in use. While the company claims to have engineered a solution to the interference problems, the most recent government tests prove otherwise.

U.S. Regulators are still reviewing LightSquared’s LTE network to determine the extent of the interference problems and won’t allow the company to deploy without approval.

If LightSquared ceases operations it could jeopardize wireless solutions for a number of high-profile companies, including Best Buy, Leap Wireless, Sharp and several others. Also worth noting is the startup’s agreement to pay Sprint $9 billion to build out its LTE wireless network infrastructure.

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