diff --git a/server/src/com/cloud/agent/manager/ClusteredAgentManagerImpl.java b/server/src/com/cloud/agent/manager/ClusteredAgentManagerImpl.java
index 103a7b345e9..e7048c62c1e 100644
--- a/server/src/com/cloud/agent/manager/ClusteredAgentManagerImpl.java
+++ b/server/src/com/cloud/agent/manager/ClusteredAgentManagerImpl.java
@@ -578,7 +578,7 @@ public class ClusteredAgentManagerImpl extends AgentManagerImpl implements Clust
         
         //cancel all transfer tasks
         s_transferExecutor.shutdownNow();
-        cleanupTransferMap();
+        cleanupTransferMap(_nodeId);
         
         return super.stop();
     }
@@ -706,6 +706,8 @@ public class ClusteredAgentManagerImpl extends AgentManagerImpl implements Clust
         for (ManagementServerHostVO vo : nodeList) {
             s_logger.info("Marking hosts as disconnected on Management server" + vo.getMsid());
             _hostDao.markHostsAsDisconnected(vo.getMsid());
+            s_logger.info("Deleting entries from op_host_transfer table for Management server " + vo.getMsid());
+            cleanupTransferMap(vo.getMsid());
         }
     }
 
@@ -1082,14 +1084,14 @@ public class ClusteredAgentManagerImpl extends AgentManagerImpl implements Clust
         return true;
     }
     
-    protected void cleanupTransferMap() {
-        List<HostTransferMapVO> hostsJoingingCluster = _hostTransferDao.listHostsJoiningCluster(_nodeId);
+    protected void cleanupTransferMap(long msId) {
+        List<HostTransferMapVO> hostsJoingingCluster = _hostTransferDao.listHostsJoiningCluster(msId);
         
         for (HostTransferMapVO hostJoingingCluster : hostsJoingingCluster) {
             _hostTransferDao.remove(hostJoingingCluster.getId());
         }
         
-        List<HostTransferMapVO> hostsLeavingCluster = _hostTransferDao.listHostsLeavingCluster(_nodeId);
+        List<HostTransferMapVO> hostsLeavingCluster = _hostTransferDao.listHostsLeavingCluster(msId);
         for (HostTransferMapVO hostLeavingCluster : hostsLeavingCluster) {
             _hostTransferDao.remove(hostLeavingCluster.getId());
         }
diff --git a/server/src/com/cloud/cluster/ClusterManagerImpl.java b/server/src/com/cloud/cluster/ClusterManagerImpl.java
index c4df1771d59..24a006a2f28 100644
--- a/server/src/com/cloud/cluster/ClusterManagerImpl.java
+++ b/server/src/com/cloud/cluster/ClusterManagerImpl.java
@@ -127,6 +127,9 @@ public class ClusterManagerImpl implements ClusterManager {
     private String _name;
     private String _clusterNodeIP = "127.0.0.1";
     private boolean _agentLBEnabled = false;
+    private double _connectedAgentsThreshold = 0.7;
+    private static boolean _agentLbHappened = false;
+    
     
     public ClusterManagerImpl() {
         clusterPeers = new HashMap<String, ClusterService>();
@@ -607,6 +610,26 @@ public class ClusterManagerImpl implements ClusterManager {
                     }
 
                     peerScan();
+                    
+                    //initiate agent lb task will be scheduled and executed only once, and only when number of agents loaded exceeds _connectedAgentsThreshold
+                    if (_agentLBEnabled && !_agentLbHappened) {
+                        List<HostVO> allManagedRoutingAgents = _hostDao.listManagedRoutingAgents();
+                        List<HostVO> allAgents = _hostDao.listAllRoutingAgents();
+                        double allHostsCount = allAgents.size();
+                        double managedHostsCount = allManagedRoutingAgents.size();
+                        if (allHostsCount > 0.0) {
+                            double load = managedHostsCount/allHostsCount;
+                            if (load >= _connectedAgentsThreshold) {
+                                s_logger.debug("Scheduling agent rebalancing task as the average agent load " + load + " is more than the threshold " + _connectedAgentsThreshold);
+                                _rebalanceService.scheduleRebalanceAgents();
+                                _agentLbHappened = true;
+                            } else {
+                                s_logger.trace("Not scheduling agent rebalancing task as the averages load " + load + " is less than the threshold " + _connectedAgentsThreshold);
+                            }
+                        } 
+                    }
+                    
+                    
                 } catch(CloudRuntimeException e) {
                     s_logger.error("Runtime DB exception ", e.getCause());
 
@@ -937,10 +960,6 @@ public class ClusterManagerImpl implements ClusterManager {
             _heartbeatScheduler.scheduleAtFixedRate(getHeartbeatTask(), heartbeatInterval, heartbeatInterval, TimeUnit.MILLISECONDS);
             _notificationExecutor.submit(getNotificationTask());
              
-             //Initiate agent rebalancing after the host is in UP state
-             if (_agentLBEnabled) {
-                 _rebalanceService.scheduleRebalanceAgents();
-             }
 
         } catch (Throwable e) {
             s_logger.error("Unexpected exception : ", e);
@@ -1063,6 +1082,12 @@ public class ClusterManagerImpl implements ClusterManager {
         
         
         _agentLBEnabled = Boolean.valueOf(configDao.getValue(Config.AgentLbEnable.key()));
+        
+        String connectedAgentsThreshold = configs.get("agent.load.threshold");
+        
+        if (connectedAgentsThreshold != null) {
+            _connectedAgentsThreshold = Double.parseDouble(connectedAgentsThreshold);
+        }
 
         this.registerListener(new LockMasterListener(_msId));
 
@@ -1191,5 +1216,4 @@ public class ClusterManagerImpl implements ClusterManager {
     public  boolean isAgentRebalanceEnabled() {
         return _agentLBEnabled;
     }
-
 }
diff --git a/server/src/com/cloud/cluster/agentlb/dao/HostTransferMapDaoImpl.java b/server/src/com/cloud/cluster/agentlb/dao/HostTransferMapDaoImpl.java
index 0fff8268870..acef54a2b58 100644
--- a/server/src/com/cloud/cluster/agentlb/dao/HostTransferMapDaoImpl.java
+++ b/server/src/com/cloud/cluster/agentlb/dao/HostTransferMapDaoImpl.java
@@ -51,6 +51,7 @@ public class HostTransferMapDaoImpl extends GenericDaoBase<HostTransferMapVO, Lo
         
         IntermediateStateSearch = createSearchBuilder();
         IntermediateStateSearch.and("futureOwner", IntermediateStateSearch.entity().getFutureOwner(), SearchCriteria.Op.EQ);
+        IntermediateStateSearch.and("initialOwner", IntermediateStateSearch.entity().getInitialOwner(), SearchCriteria.Op.EQ);
         IntermediateStateSearch.and("state", IntermediateStateSearch.entity().getState(), SearchCriteria.Op.IN);
         IntermediateStateSearch.done();
         
diff --git a/server/src/com/cloud/configuration/Config.java b/server/src/com/cloud/configuration/Config.java
index 195ab65c6ac..55b64c96893 100755
--- a/server/src/com/cloud/configuration/Config.java
+++ b/server/src/com/cloud/configuration/Config.java
@@ -238,9 +238,10 @@ public enum Config {
 	SubDomainNetworkAccess("Advanced", NetworkManager.class, Boolean.class, "allow.subdomain.network.access", "true", "Allow subdomains to use networks dedicated to their parent domain(s)", null),
 	EncodeApiResponse("Advanced", ManagementServer.class, Boolean.class, "encode.api.response", "false", "Do UTF-8 encoding for the api response, false by default", null),
 
+	DnsBasicZoneUpdates("Advanced", NetworkManager.class, String.class, "network.dns.basiczone.updates", "all", "This parameter can take 2 values: all (default) and pod. It defines if DHCP/DNS requests have to be send to all dhcp servers in cloudstack, or only to the one in the same pod", "all,pod"),
 	ClusterMessageTimeOutSeconds("Advanced", ManagementServer.class, Integer.class, "cluster.message.timeout.seconds", "300", "Time (in seconds) to wait before a inter-management server message post times out.", null),
-	DnsBasicZoneUpdates("Advanced", NetworkManager.class, String.class, "network.dns.basiczone.updates", "all", "This parameter can take 2 values: all (default) and pod. It defines if DHCP/DNS requests have to be send to all dhcp servers in cloudstack, or only to the one in the same pod", "all,pod");
-		
+	AgentLoadThreshold("Advanced", ManagementServer.class, Float.class, "agent.load.threshold", "0.7", "Percentage (as a value between 0 and 1) of connected agents after which agent load balancing will start happening", null);
+
 	private final String _category;
 	private final Class<?> _componentClass;
 	private final Class<?> _type;
diff --git a/server/src/com/cloud/host/dao/HostDao.java b/server/src/com/cloud/host/dao/HostDao.java
index edaefc65e61..e296ff8058b 100644
--- a/server/src/com/cloud/host/dao/HostDao.java
+++ b/server/src/com/cloud/host/dao/HostDao.java
@@ -184,4 +184,6 @@ public interface HostDao extends GenericDao<HostVO, Long> {
     List<HostVO> listByManagementServer(long msId);
 
     List<HostVO> listSecondaryStorageVM(long dcId);
+    
+    List<HostVO> listAllRoutingAgents();
 }
diff --git a/server/src/com/cloud/host/dao/HostDaoImpl.java b/server/src/com/cloud/host/dao/HostDaoImpl.java
index 1b9cd057ca2..c8f6ba83437 100644
--- a/server/src/com/cloud/host/dao/HostDaoImpl.java
+++ b/server/src/com/cloud/host/dao/HostDaoImpl.java
@@ -50,9 +50,9 @@ import com.cloud.utils.db.Filter;
 import com.cloud.utils.db.GenericDaoBase;
 import com.cloud.utils.db.GenericSearchBuilder;
 import com.cloud.utils.db.JoinBuilder;
+import com.cloud.utils.db.JoinBuilder.JoinType;
 import com.cloud.utils.db.SearchBuilder;
 import com.cloud.utils.db.SearchCriteria;
-import com.cloud.utils.db.JoinBuilder.JoinType;
 import com.cloud.utils.db.SearchCriteria.Func;
 import com.cloud.utils.db.SearchCriteria.Op;
 import com.cloud.utils.db.Transaction;
@@ -101,6 +101,9 @@ public class HostDaoImpl extends GenericDaoBase<HostVO, Long> implements HostDao
     protected final GenericSearchBuilder<HostVO, Long> CountRoutingByDc;
     protected final SearchBuilder<HostTransferMapVO> HostTransferSearch;
 
+    protected final SearchBuilder<HostVO> RoutingSearch;
+
+
     protected final Attribute _statusAttr;
     protected final Attribute _msIdAttr;
     protected final Attribute _pingTimeAttr;
@@ -285,6 +288,10 @@ public class HostDaoImpl extends GenericDaoBase<HostVO, Long> implements HostDao
         ManagedRoutingServersSearch.and("server", ManagedRoutingServersSearch.entity().getManagementServerId(), SearchCriteria.Op.NNULL);
         ManagedRoutingServersSearch.and("type", ManagedRoutingServersSearch.entity().getType(), SearchCriteria.Op.EQ);
         ManagedRoutingServersSearch.done();
+        
+        RoutingSearch = createSearchBuilder();
+        RoutingSearch.and("type", RoutingSearch.entity().getType(), SearchCriteria.Op.EQ);
+        RoutingSearch.done();
 
         _statusAttr = _allAttributes.get("status");
         _msIdAttr = _allAttributes.get("managementServerId");
@@ -922,4 +929,11 @@ public class HostDaoImpl extends GenericDaoBase<HostVO, Long> implements HostDao
         
         return listBy(sc);
     }
+    
+    @Override
+    public List<HostVO> listAllRoutingAgents() {
+        SearchCriteria<HostVO> sc = RoutingSearch.create();
+        sc.setParameters("type", Type.Routing);
+        return listBy(sc);
+    }
 }