Source is the legislation authorizing the commissioners and the letter Davs sent to Abraham Lincoln. The commissioners were sent "For the purpose of establishing friendly relations between the Confederate States and the United States..." Only after obtaining recognition of the legitimacy of their actions was there a vague offer to "settlement of all questions of disagreement" which may or may not have included paying for all property appropriated. But regardless, without recognition there was no negotiation and unless Lincoln caved completely to the rebel demands there would be no recognition. So it was a ultimatum, nothing more or less.
No...an ultimatum is when you threaten WAR. They didn't do that.