The Desktop Window Manager has exited with code (0x40010004)

We are running a Windows 2008 R2 server in a terminal server environment. Every time a user logs in and out of the server we get the following notifications:

EventID 9003

The Desktop Window Manager was unable to start because a composited theme is not in use

EventID 9009

The Desktop Window Manager has exited with code (0x40010004)

We do have a GPO policy that is: "Force a specific visual style file or force Windows Classic" which is set to Enabled.

I have not found a way to resolve either of these notices. Any suggestions?

This could be because of "Client Compatibility Settings". I had faced the same issue 10 mins ago after licensing my terminal server and this is how I fixed it.

1. Go to 'Remote Desktop Session Host Configuration'
2. In the 'Connections' section, right click on your connection name and select 'Properties'
3. In properties window, go to 'Client Settings' tab
4. Uncheck 'Limit Maximum Color Depth'
5. Click apply and ok
6. Now go to 'Remote Desktop Services Manager'
7. Select your terminal server from left plane
8. Right click on each user account under 'Users' tab on right plane and select Log Off

Done! next time users should get successful login.