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How Can I Get Office365 to Relay SMTP Message to Recipient Outside of My Network

My company is using Hosted Exchange, via Office 365, for email services. I have a server that is co-located outside of our company network that needs to utilize SMTP to send emails to clients. I created an incoming connector in Exchange to allow relay of emails originating from the public IP of this server. If those emails are sent to an email address on one of the domains serviced by our Hosted Exchange, it gets delivered to the recipient. However, any emails sent by this server to a recipient not in one of our domains, simply disappears, and is never delivered. I even checked the SPF record for this domain, to ensure the IP address of the server is included in it. I have a feeling I am missing one simple step, yet for the life of me, I can't figure out what it is.
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footech
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I am accepting both solutions because the expert comment from footech is technically correct. It should have worked. However, I am using a different SMTP service because Microsoft has acknowledged a problem on their end that they are still working to correct.