I've personally tested this scenario on relatively newer Cisco devices and it literally just prints a message on the console to the tune of "TCAM exhausted, ref

I've personally tested this scenario on relatively newer Cisco devices and it literally just prints a message on the console to the tune of "TCAM exhausted, refusing to add route A.B.C.D/X" and continues working without problems. I think there is a config on some models to install the route in the slow path, but by default it just doesn't use the route.