It sounds like voodoo but Timothy's work around did indeed fix the problem for 
me, probably only temporarily though.
https://bugs.launchpad.net/ubuntu/+source/evolution-exchange/+bug/207723/comments/37

In summary, and assuming your setup worked and then mysteriously stopped 
working:
1. Delete your mailbox name from the Exchange
2. Authenticate

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Evolution will not authenticate on Exchange
https://bugs.launchpad.net/bugs/207723
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