Basically, the signup period for new coaches (and coaches formerly in that world who are comming back) runs until 5PM Eastern. When signups conclude the Sim AI schools make their selection of players. The servers are not able to process these actions and human coach recruiting actions at the same time. Therefore, an hour is cut off of the normal 3 hour cycle.
Many coaches have requested a change to allow more time for the initial cycle. It may change sometime in the future but right now that's simply the way it is.