Same here, kernel panic with v. 0.120ubuntu1
I also use intel-microcode; remiving does not solve anything.
However, intramfs.tools_0.103ubuntu16 works well.
I had to chroot to downgrade to that one.

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https://bugs.launchpad.net/bugs/1481733

Title:
  Kernel panic when booting with initramfs-tools version 0.120ubuntu1
  generated initramfs

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