This looks like you are trying to use Rebex SFTP to connect to a server that either does not use SFTP/SSH, or that uses legacy version of SSH protocol that is not supported. Are you sure you are actually connecting to an SFTP/SSH server and not to an FTP/SSL server? Please check out our file transfer protocol info page for more information.
If this doesn't help, please create a communication log using Sftp or Ftp object's LogWriter property (see this for more information) and post it here or mail it to support@rebex.net - we should then be able to tell what is going on.