99% CPU usage by KVM was solved by above mentioned fix. But another issue arised:
Quote error: Failed to create domain from /etc/libvirt/qemu/v100*.xml
error: Unable to create cgroup for v100*: No such file or directory
It seems that Arvind helped to solve this by advising this:
Quote libvirtd stopped working so you need to do "service libvirtd restart" then you vpses again start working.
Here your vps was not starting because you have added cpu units 500, Minimum requirement is 1000.
In another words, if "Unable to create cgroup" kind of error appear, one may try:
1. opening VPS configuration (and VPS Plans) in Virtualizor and make sure CPU units are set to "1000" (not less) and CPU % set to "0" (in KVM VPS's, OpenVZ seems not to be affected)
2. command "service libvirtd restart"
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