Liberty Media has submitted a proposal to acquire a 40% stake in a restructured iHeartMedia that would give the investment firm four seats on the company’s board of directors. Under the proposal, submitted on Saturday, Liberty would invest $1.159 billion in cash in iHeart. Liberty and Sirius XM Radio, which Liberty owns a majority stake of, would equally split 40% of newly issued shares in the recapitalized company.

The offer comes as a grace period triggered by a loan payment iHeart intentionally skipped is set to expire later this week. An iHeart spokesperson had no comment on the bid, which could be one of several which investors make as iHeart continues to negotiate a potential chapter 11 bankruptcy reorganization plan with its lenders.

News of the offer came in the form of a press release issued by some of iHeart’s lenders and noteholders on Monday, who say they received a proposed term sheet from Liberty on Saturday. It includes several terms that are “to be determined” according to the release. But by going public before specifics have been worked out, the lenders could be angling to put pressure on the company to consider the proposal. Should iHeart elect to accept the offer, it would be required to “use reasonable best efforts” to quickly get the bankruptcy court's approval of the investment. Liberty says its offer also hinges on a final chapter 11 plan that is acceptable to Liberty.

The term sheet lists a number of claims, including from iHeart’s senior lenders and unsecured noteholders, that would have to be negotiated to strike a deal. iHeart would need to use cash collateral or obtain financing that’s agreeable to its secured creditors and acceptable to Liberty. Liberty says its offer “is intended to work in concert with the Company's existing Restructuring Support Agreement discussions and in effect be added to that Plan.”

Under the proposed terms, iHeart’s Clear Channel Outdoor business would be spun off in a taxable transaction. The proposed investment agreement also calls for iHeart to have a nine member board of directors with Liberty and iHeart each appointing four directors. Liberty would also get proportional representation on all committees of the board. The offer includes a “no shop” obligation by iHeart.

One issue the proposal doesn’t address is whether federal regulators would approve Liberty Media acquiring a 40% stake in the radio industry’s largest group owner while at the same time holding a controlling interest in the sole satellite radio provider. Liberty owns 69% of SiriusXM and 34% of concert promoter Live Nation.