Currently also encountering this issue (the same kernel panic) with ami-3079f543 on eu-west-1 with a c3.large instance.
So this seems to be a general ubuntu 16.04 on AWS issue and not an upgrade specific issue. I haven't seen this issue with the beta2 AMIs.
Interestingly I seem to be able to start the AMI on t2.micro instances, so this could well be instance type specific.
Currently also encountering this issue (the same kernel panic) with ami-3079f543 on eu-west-1 with a c3.large instance.
So this seems to be a general ubuntu 16.04 on AWS issue and not an upgrade specific issue. I haven't seen this issue with the beta2 AMIs.
Interestingly I seem to be able to start the AMI on t2.micro instances, so this could well be instance type specific.