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The error indicates that the conversion process ran out of memory (RAM) while converting. There's, as far as I know, no way to fix it short of physically adding RAM to the system.
It should also be said that a 40 MB file is quite huge for an ebook. Additional complexities may make conversion even more difficult should this be a reference book or something.
Edit: I should read more than just the error message and the question, just saw that it's not a reference book. Still, the comment is true, although inapplicable.
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