I just talked to DW and this is what he had to say:
The split was amicable and the terms were decided on in advance. Cro Cops $350k (plus bonuses) contract had a clause in it stating that if he lost two consecutive fights Zuffa had the right to void the existing agreement and negotiate a new one.
CC never dreamed that he would be so overwhelmed by the level of competition he has faced in the UFC so far and and the losses have impacted him mentally.
The UFC did NOT cut Cro Cop from the roster nor did they threaten to make him sit out until his contract expired if he didn't take the pay cut deal.
Rather than negotiate a new contract with the UFC right now (and risk racking up more losses), Cro Cop wants to get a couple of tune up fights (and wins) in some of the smaller shows (no more tune up matches for him in the UFC) in hopes of rebuilding his confidence and getting himself back on track.
DW understood completely and supported Cro Cop in his decision. The last thing DW wants to do is shell out a six-figure purse to a fighter that isn't fighting worth a dayum. Even though it would have been lower than the original figure, it would still be a waste of money and resources.
Interesting but Dana doesn't usually doesn't give concessions like this!
More to come I'm sure!