Resetup kernel for virtualbox and now ubuntu is in initramfs state

Question

My 10.04LTS became Read-Only so I wanted to reboot this virtual machine. Then I couldn't get it back up running.

VirtualBox threw Result Code: NS_ERROR_FAILURE (0x80004005) error.

I did the kernel re-setup:

sudo /etc/init.d/vboxdrv setup
 * Stopping VirtualBox kernel modules                                    [ OK ] 
 * Uninstalling old VirtualBox DKMS kernel modules                       [ OK ] 
 * Trying to register the VirtualBox kernel modules using DKMS           [ OK ] 
 * Starting VirtualBox kernel modules                                    [ OK ]

I can't even use sudo in this state. What can I do?

(initframfs) /dev/sda1
/bin/sh: /dev/sda1: Permission denied
(initframfs) /dev/sda2
/bin/sh: /dev/sda3: Permission denied
(initframfs) /dev/sda3
/bin/sh: /dev/sda1: not found

I have a similar image so I can check the disks setting if needed. Please help me. Thanks.

I have an older version of VirtualBox: 4.0.8 something like that. But other vms on the same VirtualBox are working fine.

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UPDATE

I can hold down SHIFT key and see the GURU menu. Only one kernel exists.

Ubuntu(...)
Ubuntu(recovery)
master test
master test