Royle, meanwhile, has already begun making ruthless cuts in the City playing staff - starting with the veteran midfielder Ian Brightwell. The City manager has signed a new three-year deal, adding another 12 months to his existing contract, while his assistant Willie Donachie has agreed a two-year extension to the one-year agreement he already had.
However, while Royle and his No 2 were putting pen to paper, the axe was falling on the players, the biggest shock being the decision not to offer the long-serving Brightwell a new deal.
The goalkeeper Martyn Margetson has also been released, while Craig Russell and Ged Brannan have been put on a transfer list which is set to include players who have cost the club more than pounds 4m in the past three seasons.
Uwe Rosler has already left Maine Road for Kaiserslautern, and the pounds 5m- rated Georgi Kinkladze is on his way to Ajax.
Richard Edghill, another who is out of contract, has signed a new four- year deal, while the teenage striker Leon Mike has also accepted a four- year offer.
Kit Symons' future, though, is in doubt. The defender opened talks with Royle yesterday and will have further discussions later this week. It is believed the new offer to Symons is a massive cut in his current wages. He said: "I have had a chat with the boss, and there has been an offer made - but there is still a lot of talking to do."
For Brightwell, though, it is a sad end to an 18-year association with the club he joined as a 12-year-old. Half-way through his testimonial season, he said: "Joe has told me he can't offer me a new contract because of the financial situation the club is in. I felt sick walking out of his office. I have been at City all those years and never wanted to leave. I was a supporter of the team before I joined as a player, so it is doubly sad.
"I have been told I can still have my testimonial match, hopefully pre- season, but it has knocked me sideways, really. I still believe I can do a good job for a First Division club and could still even play in the Premiership. I will keep all my options open and hope something comes up, but leaving City will take a lot of getting over."
Russell, who joined City in November as part of the pounds 1m swap that took Nicky Summerbee to Sunderland, and Brannan will go on a transfer list that includes many of the dozen players who have been out on loan in recent months, including Martin Phillips, Paul Beesley, Neil Heaney, Rae Ingram, Barry Conlon and Eddie McGoldrick. City also want to sell the likes of Nigel Clough, Scott Hiley, Khakaber Tskhadadze and Murtaz Shelia - when the latter has recovered from a serious knee injury.
Royle is looking to reduce the 50-plus playing staff by more than 20 to cut the current pounds 7m wage bill by half before City embark on their first season of third-grade football. He is determined to drag City back into the big time, and said: "It took Willie and me about two minutes to agree to the extensions. I am very impressed with the club's ambitions and I honestly think we have the basis of a decent side here.
"Our immediate aim is to get back into the First Division, but the long- term plan is to battle back to the Premiership," Royle added. "To be honest, despite relegation, there is a great spirit about the club and a belief in what we are doing."
City's chairman, David Bernstein, said: "We are delighted that Joe and Willie have decided to further commit themselves to the club. They have, as the board do, great confidence in the club. It will take hard work and commitment, but we are united as a team in the quest to deliver the aspirations our fans so richly deserve."
Seven Chelsea first-team players were yesterday still receiving treatment on injuries that are threatening their involvement in Sunday's relegation decider against Bolton at Stamford Bridge.
Just a week before the European Cup-Winners' Cup final against VfB Stuttgart, Franck Leboeuf, Gianfranco Zola, Frank Sinclair, Michael Duberry, Dennis Wise, Graeme Le Saux and Andy Myers are all on the treatment table.