sp_OACreate in SQL Server 2005, Fails with 'Not enough storage is available to complete this op

This is the C# code for the COM:

using System;
using System.Runtime.InteropServices;
using System.Reflection;
using System.Runtime.CompilerServices;
using System.EnterpriseServices;

// General Information about an assembly is controlled through the following
// set of attributes. Change these attribute values to modify the information
// associated with an assembly.
[assembly:AssemblyTitle("CSServer")]
[assembly:AssemblyDescription("Test SQL .NET interop")]
[assembly:AssemblyDelaySign(false)]
[assembly:AssemblyKeyFile("MyKey.snk")]

// Setting ComVisible to false makes the types in this assembly not visible
// to COM components. If you need to access a type in this assembly from
// COM, set the ComVisible attribute to true on that type.
[assembly:ComVisible(true)]

// The following GUID is for the ID of the typelib if this project is exposed to COM
[assembly:Guid("ff35c6b4-81bf-47dd-9290-fcbbb49008d9")]

// Version information for an assembly consists of the following four values:
//
// Major Version
// Minor Version
// Build Number
// Revision
//
// You can specify all the values or you can default the Revision and Build Numbers
// by using the '*' as shown below:
[assembly:AssemblyVersion("1.0.0.1")]
[assembly:AssemblyFileVersion("1.0.0.1")]

// the ApplicationName attribute specifies the name of the
// COM+ Application which will hold assembly components
[assembly:ApplicationName("SQLInterop")]

// the ApplicationActivation.ActivationOption attribute specifies
// where assembly components are loaded on activation
// Library : components run in the creator's process
// Server : components run in a system process, dllhost.exe
[assembly:ApplicationActivation(ActivationOption.Server)]
namespace SQLInterop
{
publicinterfaceITest
{
string SayHello();
string SayIt(String strMessage);
}

//[SecurityRole("RBSecurityDemoRole", SetEveryoneAccess = true)]
[ComVisible(true)]
[CLSCompliant(false)]
[ClassInterface(ClassInterfaceType.None)]
publicclassCSharpHelper :ITest
{
publicstring SayHello()
{
return"Hello from CSharp";
}

publicstring SayIt(String strMessage)
{
return strMessage +": from CSharp";
}
}
}