This seems really easy to me, I don't know why this is so complicated, you have to trade him. That's the simple answer. Signing him to the kind of contract he's looking for is something they obviously are not going to do, nor should they do. Losing him for nothing is utterly ridiculous, that option cannot be entertained. Trading him at the deadline makes no sense because if they're in a wild card race it'll look horrible on the organization to trade him, but you can't lose him for nothing I don't care if they are in a wild card race. Thus, you have to trade him and it has to be this offseason. There's every chance you get more value out of the pieces you get back, especially for the money you will be saving.
Same goes for Bo. I still think you can get more than pennies on the dollar for him, he had a consistent run of all star success outside of one injury plagued season. It seems even more certain that they're unlikely to sign him so trade him too.
Pull off the f***ing Band-Aid already.