Assigning the vCenter Server or vSphere ESXi Hosts with the licenses the hosts would be disconnected with the error message as “The Host license edition is not compatible with the vCenter Server license edition"
This is due to the mismatch in the edition of vCenter Server and ESXi
vCenter Server Essentials supports/manages the ESXi Hosts licensed with vSphere Essentials and Essentials Plus.
vCenter Server Standard edition supports the ESXi Hosts licensed with vSphere Standard and Enterprise Plus.
Due to this, when you try to change the license key for Hosts or vCenter Server, you get critical alarm as the host license edition is not compatible, and the hosts will be disconnected from the vCenter Server.
Administration>Licenses
Once the compatible license key is applied to vCenter Server and vSphere Hosts, choose the Inventory>Hosts and Clusters and reconnect the Hosts to vCenter Server.
Under Hosts, access to Alarms>Triggered alarms
and acknowledge or reset the alarm.
For more information refer to below Techdocs
How to Configure License Settings for Your ESXi Host
Licensing for ESXi Hosts