I read this story in a couple of places around the internet and just heard it on the radio, but was waiting for a substantiated source to report it before I posted.
According to ESPN's Ed Werder, Glenn has agreed to a split contract with the Cowboys. The deal means that he would not be paid his full salary if he reinjures his knee. I am guessing that the deal Glenn has agreed to is not necessarily the $500,000 deal Jerry Jones was offering but instead something in the middle.
The report also says that Jerry Jones has yet to make a decision on the matter. To me this means that Jerry the Showman is waiting until the opening ceremonies to make the announcement.
We will update you with the news as it is available.
Hat tip to BoNeZ for breaking the story in his Fanpost.
UPDATE: Nick Eatman is reporting that there is no official resolution and that it is uncertain as to what will actually happen. Acknowledging ESPN's report, Eatman says that one team souce says that Glenn will not be playing for the Cowboys this year.