You are getting the error message below in your Application Event log for your Outbound Mail Service:
The smtp server requires a secure connection or the client was not authenticated. The server response was 5.7.1 Client was not authenticated
This means that the user account used in the "Outlook Mail Server Settings" isn't authenticated, and therefore will not have proper permissions to process emails.
Check the user account specified within your "Outlook Mail Server settings."
Your Exchange Server Administrator should be able to help you solve this issue by adding the right permissions to the relevant user account.