III Exploration II LP filed Chapter 11 on July 26, 2016 as an upstream oil-and-gas debtor whose working interests spanned roughly 900 leases across Utah, Colorado and North Dakota; its first-day cash-collateral motion said the case was filed after first-lien lenders began exercising remedies, with the debtor seeking time to operate, sell assets or refinance source filing source filing. The capital stack was heavily impaired: Wilmington Trust, as successor agent to KeyBank, held at least $88.0 million in first-lien debt; KeyBank held about $26.8 million in second-lien debt; and Intermountain Industries held about $132 million in subordinated unsecured debt, with total general unsecured claims estimated near $141.9 million source filing.

The court confirmed III Exploration’s amended Chapter 11 liquidating plan on Dec. 4, 2018, after the debtor had sold substantially all assets, including North Dakota, Raton Tract, Eastern Uinta Basin and Western Uinta Basin assets, for approximately $62.3 million in gross proceeds source filing source filing. The plan routes cash and remaining assets through a wind-down administered by Michael E. Rich, pays allowed administrative and priority tax claims in cash, and leaves value concentrated at the first-lien level: estimated first-lien recovery was about 61%, while second-lien lenders, general unsecured creditors and equity were projected to receive no distribution unless senior classes were paid in full source filing.