Terminal Server connection error

I have a terminal server which is running on win2k Advanced server (set up as an application)and a terminal license server on a reg. win2K server (Domain Controller). The problem I have is one of the workstations cannot connect to the term. server after a HD crash (win98). The error message was "Because of a network error the session will be disconnected". Then I checked the error message on the term. server event viewer, it said "The Terminal Server cannot issue a client license" and "The terminal services could not locate a license server, ....." Both the term. server and the license server have been patched with the license enhancement hotfix. I have also checked on the license server Terminal Services Licensing that we still have 10 available. Any idea what's wrong please help.