Teams become ownerless if they have not logged in for 6 weeks. This happens on Monday morning (local time for the country).
Players with high salaries (currently over $10,000/week, with a little less for younger players) or on the roster of a NT become free agents. They are removed from the roster of their club team and placed on the TL.
The rest of the roster is left alone, but the lineup is reset to use the highest salaried players on the roster.
When a new owner is assigned to the club, the rest of the players on the old team retire.