That error is not related to the connection to SQL Server.
The Denodo license that you are using probably has a limit in the number of concurrent queries (requests) that Denodo will process. So, at the same time that you are trying to connect to the SQL server (this requires queries to be executed on the Denodo side) other queries are in execution on your Denodo server and you are reaching this limit.
You can monitor the system to see how many queries are being executed using the Diagnostic and Monitoring Tool or the Denodo Monitor.
Hope this helps!