The SBS Server is in an Activation loop after applying Transition Pack and Windows Server 2003 Service Pack 2

Source: Microsoft Support

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You installed Windows Small Business Server 2003 Transition Pack. After that, you applied Windows Server 2003 Service Pack 2, and are repeatedly prompted to activate the computer:

Windows Product Activation

This copy of Windows must be activated with Microsoft before you can continue. You cannot log on until you activate Windows. Do you want to activate Windows now?

To shut down the computer, click Cancel.

The activation loop may be a result of the following issue: 

914990 Installation of the Windows SBS 2003 Transition Pack may silently fail on a Windows SBS 2003-based computer.

It may occur if the Backup Exec program is installed, and the following registry key exists:

[HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Small Business]



914990 Installation of the Windows SBS 2003 Transition Pack may silently fail on a Windows SBS 2003-based computer
http://support.microsoft.com/default.aspx?scid=kb;EN-US;914990

To resolve this problem immediately, contact Microsoft Product Support Services for more information. For a complete list of Microsoft Product Support Services telephone numbers and information about support costs, visit the following Microsoft Web site:

http://support.microsoft.com/contactus/?ws=support