Actually we're both right. If there is offset language in the contract, which most have then if a player with guaranteed money signs elsewhere his salary and cap hit would be reduced by the amount paid by the other team.
Cut Manuel
Cap savings: Between $500,000 and $1.2 million
Dead money: $1.2 million in 2015, and at least $1.2 million in 2016)
From reports when he signed, it is assumed that Manuel's rookie contract contains offset language for his guaranteed money, hence the range of potential cap savings. Assuming Manuel is signed by another team, whatever salary that team pays him will be offset from the guaranteed money the Bills are scheduled to pay Manuel this year (just over $1.2 million). If Manuel is still in the league in 2016, the same result will follow again, with the Bills' guarantee to pay Manuel $1.6 million reduced by whatever salary he receives from another team. The remaining value of Manuel's prorated signing bonus would be split in equal $1.2 million dead money hits in 2015 and 2016.