Ori, are you certain you are on SR1? The full build for SR1 is 12.40.20100, you listed 12.040.20000, which is the Initial Release... Double-check that, if you do not have SR1, do try that just to be sure. We would need a sample app of some sort that you are experiencing the issue with in order to test things to see if we can replicate the issue or not. The server specs seems to be fine, but if you have other stuff running on that box etc., you might have a resource problem contributing to things. The only other thing that comes to mind would be the Graphics Driver running on the server maybe not having enough memory allocated to it.... Sorry I do not have anything better for you.
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