Problem
You’re getting an error in SCVMM stating that the format of a aVHD file on a Hyper-V server is not compatible with the VHD format. It is specified with the warning code 3107.
Cause
Although checkpoints can be very useful at some times, they can also be a pain when something goes wrong… as it’s the case here.
When you try to manage the checkpoint, suddenly the warning will be upgraded to an error 
Resolution
Connect to the Hyper-V Management Console, find the machine and and remove or merge all snapshots that are in place for that VM. After this, shutdown the virtual machine.
You will see that the status of the VM will change to “Merge in progress”.
Now this may take considerable time, depending on the size of the snapshot, the amount of snapshots to merge, etc. Please be patient, you will be able to bring the VM back online when it’s done with the merge 
