Cannot connect to SQLServer using Security Manager

I have two installations of SQL Server one a PDC and the other on a BDC.
Both are configured to use Named pipes and integrated security.
The problem is when I try to connect to theSQL Server on the PDC with Security Manager it stops the SQLserver service and gives the error below. When I restart the SQL server service  and try to connect again it  freezes and I have to forceably end the task which leaves the SQL Server service in an unstable state.

SQL Server Error
Msg 10025 Severity 9 State 0

Error: Possible network error: Write to SQL Server failed. Connection Broken.

OS Error 109  Connection Transact (GetOverLappedResults())

The event log has a number entries by SQLCTR60  all of which say:- DB-Library: SQL Server connection timed out

I checked up error 10025 and severity 9 in the Online books but it doesn't help.



Other than this there is no other problem with the SQLserver

None of this happens on with SQLserver on the BDC.
mem100Asked:
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crsankarCommented:
Does the account that you are using to run sql server have the log on locally right? Check this first. Try logging on to the PDC by using this account.
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mem100Author Commented:
crsankar

Both SQLServers use the same account which has log on as a service right. Since the server on the BDC works fine I don't think that the account is the problem.
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mem100Author Commented:
crsankar

The account also has the following rights

log on locally
act as part of OS
replace process level token
increase quotas

Don't know if this helps
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crsankarCommented:
Is this problem happening only when you use the security manager to connect? Is it happening when you use any other tool. for instance, isql/w? Can you try and establish a connection to the server on the PDC by using security manager from the BDC.
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mem100Author Commented:
My mistake the account actually didn't have the log on locally right I thought I gave it the right but I must have forgotten. You get the points
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