We found the root cause of the problem. It occurs when you use SMTP Proxy Server and use AD to validate users AND local domain is not added in SMTP Server. There are two ways to fix it.

• Method 1: Go to SMTP Configuration under Server Configuration, click on Domain tab and ensure your local domains are listed in here. These are your email domains, not AD domain. For example:
  
  Domain Name: yourdomain.com
  Forward To: <IP Address of you Exchange>
  Active Directory: Default
  
  
• Method 2: Visit http://xeams.com/ManuallyPatching.htm and manually patch Xeams again. You will be downloading build 5959.