Brady was originally scheduled to earn a salary of $5.75 million, and a roster bonus of $6 million, for a grand total of $11.75 million.
The Patriots reduced his salary to $950,000, and converted the remaining $4.8 million in salary, along with his roster bonus, and converted the entire $10.8 million into a signing bonus. By so doing, that $10.8 million is prorated among the three remaining years of his contract: Instead of having $11.75 million count against the cap in 2012, they'll only have $4.55 million (his $950,000 salary, plus $3.6 million, one-third of the new signing bonus).
Brady's restructuring doesn't cost him a dime (in fact, it means he gets the money sooner, rather than later), but it does save the Patriots $7.2 million against the salary cap for the 2012 season.
So does this mean that the Patriots are planning to go all in for a restricted free agent like Pittsburgh Steelers WR Mike Wallace or Baltimore Ravens CB Ladarius Webb?
First off, Brady didn't just do this: It happened sometime after the start of free agency, but even its announcement on March 21 was overshadowed by the announcements of the Tim Tebow trade and the Bountygate sanctions against the New Orleans Saints. (Such is the power of the Cone of Silence that surrounds Gillette Stadium.)
So that money isn't necessarily going to one high-priced free agent; instead, it's being doled out among several players. For all we know, that salary cap savings could be covering the 2012 cap hit for new receiver Brandon Lloyd.
The only downside to this deal, of course, is that they raised his salary cap hit for 2013 and 2014 by $3.6 million each. That shouldn't be too hard to absorb in 2014, as the salary cap is set to increase dramatically when the NFL's new TV contracts kick in, but it might hurt a bit next year, as the cap will be more or less flat; the Patriots are eating up about three percent of the 2013 cap this way.
On the positive side, the new collective bargaining agreement made it much easier to carry over cap space from one year to the next, so, if it turns out that the Patriots don't need this extra cap space this year, they can just push it into next year, offsetting some of the extra $3.6 million.
The New York Jets have run into salary cap issues by repeatedly restructuring contracts; this is why they can't afford to cut LB Bart Scott. The Patriots save restructuring for situations where they know it won't come back to bite them: By being selective, they can reap big rewards at minimum risk.