Can someone pls tell me whats wrong here ?
Server is crashing 3 time in 10 minutes. We have very basic chat functionality minus chat rooms,file transfer with 4-5 concurrent users. Then also it is giving so poor performance.
From this graph I'd say that your server needs a bit more memory to work with. Perhaps you can configure it to use (say) 512MB to see if that improves your situation?
You can use Java's -Xmx flag to set the limit of the heap memory pool.
Well, you can always install the Java-monitor plugin for Openfire and tell for yourself.
From what little I know from Openfire it is quite memory hungry. Also you need to keep a eye on the permgen. The user ID's are interned for locking purposes, so Openfire leans on the string pool quick hard.