This is correct. Unless the contract had any money guaranteed. Only then would it pay. However, had he been on the team for game 1 of the regular season and then cut, he would receive full value as a veteran player. (Vested Veteran status, which I believe is 4 acquired years, but I could be wrong.)
Knowing how to work the money system can be very lucrative for a player if he can stay in the NLF long enough. One of the best examples is Chase Daniel. Currently signed with the Chargers. This will be his 12th year, 7th team, has only made 5 starts as QB, 261 pass attempts, and has made a cool $38 million in that time period. Not bad for someone who has fewer snap counts over the years than Rodgers gets in one year.