It looks like the server just closes the connection and doesn't tell us why. The server's log might contain more info about this issue.
If you are able to connect fin using third-party SFTP clients (such as WinSCP or Filezilla), try forcing RSA host key algorithm (instead of default DSA) in Rebex SFTP and let us know whether this solves the issue. The appropriate C# code:
Sftp client = new Sftp();
// Create an instance of SshParameters class to specify desired arguments.
SshParameters par = new SshParameters();
// RSA host key algorithm
par.HostKeyAlgorithms = SshHostKeyAlgorithm.RSA;
// Connect to the server. The third argument is the parameters class.
client.Connect(hostname, Sftp.DefaultPort, par);