We have a scenario where we will use LimeLM Web API to generate the license, which I believe can be done through limelm.pkey.generate which will return the product key.
Yep.
But we would like to know when the customer has activated the license, is there a way to configure Pub/Sub model in LimeLM account to notify us of the license activation?
Nope, we don't have support for that. If you tell me more about what you're trying to accomplish (bigger picture) we can tell you what to do.