These 2 parameters, Ulimit of the OS setting and MaxConnections from the Policy Server play a an important role concerning the Webagent/Policy Server connections or Policy Server / LDAP connections. Those parameters limit the number of connections or Sockets / File Descriptors that the Policy Server or that the OS can have opened at specific time.
What is the Policy Sever behavior when it reaches any of this limits ?
If Policy Server has reached the max file descriptor limit (OS Ulimit) then Policy Server will report socket error 24 and PolicyServer will be stopped and re-started by smexec.
If Policy Server has reached the MaxConnections limit then it will report "Connection limit Exceeded" and will not accept new connections but Policy Server will not shut down.