I think we are confusing a few things here.
1. If you have a 3AD you contract at the beginning of your sophomore year. Prior to that the PMS will validate that you still meet all requirements.
2. What you are reading about December of your freshman year pertains to 4 year winners. If you want to live life on the edge show up to campus freshman year not meeting the requirements. You have until the end of the semester to meet the requirements and still contract and get your school paid for. You will not receive stipend during that time, so that's the price you'll be paying for not being ready (along with some sleepless nights).
3. jagabiti...not sure what school your son goes to, but if he had a 4 year scholarship, and they waited till the end of the first semester to contract him they screwed him out of a semesters worth of stipend. At all the schools I'm familiar with the goal is to contract on the first day of school for 4 year winners. That way stipend starts on time. Stipend is not retroactive. That's not going to change...that's the way it's supposed to be done.
The bottom line is to ask your cadre/ROO/HRA about when/where/how you will contract. Hopefully they are like that helpfull ROO from Clarkson that walks his scholarship winners and prospects through every step of the process.