Sys.WebForms.PageRequestManagerServerErrorException

FileUpload doesn't support asynchronously uploading file with UpdatePanel. You can check the below link to learn about how to upload files with UpdatePanel. Just putting the FileUpload and Button into the UpdatePanel is not feasible.

http://geekswithblogs.net/ranganh/archive/2008/04/01/file-upload-in-updatepanel-asp.net-ajax.aspx
But my suggestion is using IFrame to achieve uploading file without refreshing.

Please check this video and demo: http://www.asp.net/learn/videos/video-254.aspx