1. Nature of Business and Management’s Plans Regarding Financing of Future Operations

Formation and Business of the Company

AmbiCom Holdings, Inc., a Nevada corporation (“AmbiCom”, “we”, “our”, “us”, or the “Company”), focuses its operations as an optimizer of server infrastructure configuration settings using its patented Active Continuous Optimization tool (“ACO”) which helps realize the full potential of both visualized and physical IT infrastructure. AmbiCom is also a designer and developer of wireless products focusing on Wi-Fi and Bluetoothâ applications for the medical and healthcare industry. AmbiCom purchases standard wireless products and designs and develops features and packaging to customize these products to their target original equipment manufacturer (“OEM”) markets. AmbiCom also sells home healthcare products in the retail market which include solar toothbrushes in that convert light into negatively-charged ions.

AmbiCom was organized under the laws of the State of Nevada on July 29, 2008. Prior to the Company’s acquisition of certain assets of Veloxum Corp. (“Veloxum”) AmbiCom was a holding company whose operating company, AmbiCom, Inc., is a designer and developer of wireless products focusing on the wireless medical industry. AmbiCom’s wireless modules and devices are based on the Company’s innovative application software and Wi-Fi or Bluetooth^â technologies. Following the Company’s acquisition of certain assets of Veloxum in May 2014, the Company has focused its operations on developing its application to optimize server configuration settings based upon our patented Active Continuous Optimization (“ACO”) Software, which helps realize the full potential of both virtualized and physical servers and workstations in an IT infrastructure and can assist organizations solve a number of performance related challenges.

On January 15, 2010, Med Control, Inc. (the “Registrant”) amended its Articles of Incorporation (the “Amendment”) to change its name to AmbiCom Holdings, Inc., to increase the number of its authorized shares of capital stock from 75,000,000 to 1,050,000,000 shares of which 1,000,000,000 were designated common stock, par value $0.001 per share (the “Common Stock”) and 50,000,000 were designated preferred stock, par value $0.001 per share (the “Preferred Stock”), and to effect a forward-split such that 131.2335958 shares of Common Stock were issued for every 1 share of Common Stock issued and outstanding immediately prior to filing of the amendment (the “Forward Split”). The Registrant also amended its Bylaws on January 15, 2010. On January 15, 2010, the Registrant entered into an Agreement and Plan of Share Exchange (the “Exchange Agreement”) with AmbiCom Acquisition Corp., a Nevada corporation (“AmbiCom Corp.”), whereby the Registrant acquired all of the issued and outstanding capital stock of AmbiCom Corp. in exchange (the “Exchange”) for 20,000,000 newly issued shares of Common Stock (the “Common Exchange Shares”), 2,600,000 shares of Series B Preferred Stock, options to purchase 5,500,000 common shares and 2,350,000 shares of Series A Preferred Stock at the purchase price of $.01 per share, and 500,000 warrants to purchase 500,000 shares of Common Stock at $0.50 per share. As a result of the Exchange, the AmbiCom Corp equity holders surrendered all of their issued and outstanding capital stock of AmbiCom Corp in consideration for the Exchange Shares, and AmbiCom Corp. became a wholly-owned subsidiary of AmbiCom Holdings, Inc.

On May 29, 2014, the Company acquired certain assets of Veloxum Corp., a Delaware corporation (“Veloxum”) in consideration for the issuance of 13,100,437 shares of the Company’s Common Stock. Following the Company’s acquisition of the Veloxum assets, the Company has focused its operations as an optimizer of server infrastructure configuration settings.

In March 2011, the Company established a wholly owned subsidiary, E-Care USA, Inc., a Nevada designer and developer of wireless home medical devices. In April 2015, the Company dissolved E-Care USA, Inc.

In April 2015, the Company established a wholly owned subsidiary, Lagranger, Inc., a Nevada designer and developer of the active optimization tool for the gaming market.

Details of the Company’s subsidiaries as of July 31, 2015 are as follows:

Name	Place and Date of Establishment/ Incorporation	Relationships	Principal Activities

Lagranger, Inc.	Nevada April 21, 2015	Wholly-owned subsidiary of AmbiCom Holdings, Inc.	Designer and developer of optimizer of gaming infrastructure configuration settings.

All intercompany transactions and balances are eliminated in consolidation.

Management’s Plans Regarding Financing of Future Operations

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The financial statements do not reflect any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary if the Company is unable to continue as a going concern.

The Company has incurred losses and negative cash flows from operations for the past two fiscal years. As of July 31, 2015, the Company had cash and cash equivalents of approximately $53,452, a working capital deficit of approximately $1,401,304, and an accumulated deficit of $ 15,580,122. The Company also incurred a net loss of $4,157,835 and had net cash used in operating activities of $1,098,862 for the year ended July 31, 2015.

The Company has financed its operations primarily with the proceeds from the sale of stock and issuance of convertible notes. The Company’s long-term success is dependent upon its ability to successfully develop, commercialize and market its products and services, earn revenue, obtain additional capital when needed, and, ultimately, to achieve profitable operations.

Management expects to continue to incur additional substantial losses in the foreseeable future as a result of the Company’s research and development activities. For the foreseeable future, we plan to fund all our operations and capital expenditures from the net proceeds of equity or debt offerings and existing cash balances. Although the Company plans to pursue additional financing, there can be no assurance that it will be able to secure financing when needed or to obtain such financing on terms satisfactory to the Company, if at all. If unable to secure additional financing in the future on acceptable terms, or at all, the Company may be unable to complete the development of its new products. In addition, the Company could be forced to reduce or discontinue product development, reduce or forego sales and marketing efforts and forego attractive business opportunities in order to improve liquidity to enable the Company to continue its operations. The negative cash flows and lack of financial resources of the Company raise substantial doubt as to the Company’s ability to continue as a going concern.

On August 13, 2015, the Company effectuated two convertible note agreements with two different investors for a principal amount of $25,000 for each note. The notes bear interest at a rate of 12% per annum and are convertible into shares of common stock at a conversion price equal to 60% of the lowest trade price in the 20 trading days prior to the conversion. The principal and accrued interest balances are due on August 13, 2016.

On September 4, 2015, the Company effectuated a convertible note agreement with an investor for a total principal of $69,000. The note bears interest at a rate of 10% per annum and is convertible into shares of common stock at a conversion price equal to 55% of the lowest trade price in the 20 trading days prior to the conversion. The principal and accrued interest balances are due on March 4, 2016.

On September 21, 2015, the Company effectuated a convertible note agreement with an investor for a total principal of $92,000. The note bears interest at a rate of 10% per annum and is convertible into shares of common stock at a conversion price equal to 50% of the lowest trade price in the 20 trading days prior to the conversion. The principal and accrued interest balances are due on June 21, 2016.

On September 15, 2015, the Company signed a term sheet for a new loan and security agreement with a lender. Under this agreement, the Company could initially borrow up to $1.0 million to fund working capital. The Company expects this transaction to close in the second half of November 2015.

On October 5, 2015, the Company entered promissory note with an investor for a total principal of $100,000. The principal and accrued interest balances are due in 48 payments of $2,625 each to be paid within 12 months.

On October 9, 2015, the Company entered a business loan with a creditor for a total principal of $150,000. The principal and accrued interest balances are due in 220 payments of $900 each to be paid within 10 months.

The Company believes in the viability of its strategy to increase revenue, cash flows, and profitability and in its ability to raise additional funds, and believes that the actions presently being taken by the Company will provide the Company with sufficient liquidity to continue to finance its operations.