I came across this today while performing and migration from vCenter 2.5 to vCenter 4.0

When adding an ESX 3.5 Server you will need to provide a license for the host.

vCenter 2.5 uses a separate application (FLEXLM) and there is no way to point the ESX host to use a vCenter 4.0 License.

From the vSphere Upgrade Guide

So all of this is pointing to the same thing - you have to connect your vCenter server to the old licensing server.

So how do you do this?

In the vSphere Client, select Home > vCenter Server Settings > Licensing and add your old licensing server in the field at the bottom.

Once the ESX servers have been upgraded then you will be able to assign the licenses from your vCenter 4.0 Server and remove the licensing server.