Thank you for the answers. Indeed php.ini "memory_limit" was the answer, if it helps anyone else here is the answer explained:
The Image: 1 pixel needs 4 bytes (32 bits) if alpha-channel is used, and in our situation we exceeded Allowed memory size of 52,428,800 bytes, as follows :
3680 x 2760 pixels = 10,156,800 pixels x 4 bytes = 40,627,200 bytes (remember it's a crude estimate)
So in php.ini we're going to:
- increase "upload_max_filesize" to 3M (meg)
- increase "post_max_size" to 16M (total upload per script)
- increase "memory_limit" to 64M (meg)
- increase "max_execution_time" to 90 (seconds)
Tested 5 x 2.5meg 3680x2760 pixel images and all is now fine
Also checked the load on the server via ssh (command: top, result: %id).
Thank you again and hope this helps others.