I try to change paravirtualization interface to 'None', and it's work. Nothing relevant in the logs unfortunately. Please note that an OSX 10.12.3 will update just fine. Some users have reported this error with previous OSX versions, when the Finder 'kicks' them out of the system with that message and to the login screen. IOConsoleUsers: gIOScreenLockState 3, hs 0, bs 0, now 0, sm 0x0 Issue 2: the VM gets stuck on the following:.Issue 1: the VM will not proceed with the installation, unless USB3 is specifically enabled in the template the template needs an update (or a new 10.12 template) that makes USB3 mandatory.Use the installation script from Howto: Create OSX ISO from the OSX Install app Download the 10.12.4 installer from the AppStore. Create a new OSX VM with the 10.11 template.