After a little research, we found out that the Chiefs had waived/injured him meaning he would hit the waiver wire and, if he went unclaimed, would return to the Chiefs.
And that's exactly what happened as the Chiefs announced Cottam has been placed on reserve/PUP.
He'll be out for at least the first six weeks of the regular season but I wouldn't look for him to play in 2010.
The key to doing this particular transaction is that Cottam won't count against the roster (active/PUP does) so the Chiefs can sign someone to take his place (which they already did with tight end Leroy Banks).
Cottam suffered a neck injury in week 14 last year which caused him to end the season on injured reserve. Since IR doesn't carry over from year to year, and the Chiefs wanted to retain his rights, they had to designate him as waived/injured so he could go through the waiver process and return to the team.
The Chiefs now retain Cottam's rights.