In my experience it sounds like a failing power supply. Those HPs OEM supplies are pretty much minimal for running those computers and I've replaced a number of them. Aftermarket supplies are available for around $30 or so U.S.$
We have 2 96EX systems in use in schools and yes, that delay is normal for that system. To keep people from wondering if they were cut off I installed a music source which will play when on hold or during transfers to let people know they are still connected.
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