They disappear into the ether. Always bugged me a little bit. Before generating the assistant coach signed turds, the leftovers need to be dispersed amongst the remaining teams.
Some loose hierarchy like this..
Human coached teams fill first
Followed by sim coached
Base on vision
Amount of signings left
Position of perceived need
Previous seasons WIS ranking , better record.gets first crack at recruits
Once.these recruits are dispersed then auto generate remaining slots.
Not a.must have, but would be cool.