In my endeavors to troubleshoot tomcat memory issues i performed the following in Ubuntu 10.04:
sudo gedit /etc/init.d/tomcat6
Changed (~line 81):
if [ -z "$JAVA_OPTS" ]; then
        JAVA_OPTS="-Djava.awt.headless=true -Xmx128M"
fi
To:
if [ -z "$JAVA_OPTS" ]; then
        JAVA_OPTS="-Djava.awt.headless=true -Xmx1024M -Xms1024M -XX:PermSize=256m -XX:MaxPermSize=256m -XX:NewSize=128m"
fi
You can as well explicitly state in catalina.sh file as follows (in bold):
#!/bin/sh
CATALINA_OPTS="-Xms1024m -Xmx1024m"