I had a similar issue with Update 2 on our Windows Server 2012 R2 Veeam One Monitor Server.
I was able to resolve it by:
Extracting the VeeamONE_184.108.40.2069_Update2.exe to the local desktop
Right-click on the update file and select Properties
Click the Unblock button and OK button
Right-click on the update file and select Run as administrator
I was attempting to launch it from the zip file on a remote share which appeared to be causing the issue with the update. Every time I tried to connect with Monitor Client after the update, it would fail connecting - even with the firewall completely disabled and the mentioned timeout key added.