Configurations can be invalid for two reasons:
The client determines by ARP that the IP address offered to it is in use elsewhere. In this case, the client will send a DHCPDECLINE message to the server. If the server offers more than two bad addresses, dhcpagent fails.
The client gets offers, but when it tries to confirm them, the server sends a DHCPNAK message instead of a confirmation. If the client receives DHCPNAK messages more than twice, dhcpagent fails. This indicates a malfunctioning server.