"Failed to create new connection" SQL Server agent login timeout Windows Server 2008/R2 (4302345)

A usability error is experienced for a SQL Server database agent with the following message appearing in the log.

The customer has the YYYY-MM-DD HH:MM:SS.SSS ECHO<DB_SQL_Server/5.5.8.559/DB_SQL_Server/DBSS-MYSERVER-agent> ERROR [ConnectionManagementThread-[MSSQLPool-DBSS-MYSERVER]-[MSSQLProfile{host='MYSERVER', instance='DEFAULT_INSTANCE', username='MYDOMAIN\MYUSER', authType=WINDOWS_CUSTOM, port='0'useNTLMv2='true'}]] com.quest.qsi.fason.framework.connections.jdbc.JDBCConnectionImpl - Failed to create new connection. [MSSQLProfile{host='MYSERVER', instance='DEFAULT_INSTANCE', username='MYDOMAIN\MYUSER', authType=WINDOWS_CUSTOM, port='0'useNTLMv2='true'}]

1. Navigated to Administration | Agents | Agent Status
2. Edit the properties for the DB agent
3. Changed the NTLMv2 to false and the ip address to the full qualified hostname.
4. Save the changes and return to Agent Status
5. Then deactivate and reactivate Agent and then went to database home page.
6. The hostname came up and was collecting all the data.