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From The Collaborative International Dictionary of English v.0.48:
Ultimatum \Ul`ti*ma"tum\ ([u^]l`t[i^]*m[=a]"t[u^]m), n.; pl. E. Ultimatums ([u^]l`t[i^]*m[=a]"t[u^]mz), L. Ultimata. [NL. See Ultimate.] 1. A final proposition, concession, or condition; especially, the final propositions, conditions, or terms, offered by either of the parties in a diplomatic negotiation; the most favorable terms that a negotiator can offer, the rejection of which usually puts an end to the hesitation. [1913 Webster] 2. A final demand, the rejection of which may lead to a resort to force or other compelling action by the party presenting the ultimatum. In international diplomacy, an ultimatum may be used as by the demanding country as a signal to other countries that it gave the other country a seemingly reasonable opportunity to avoid a war; in this way, the demanding country may seek to avoid responsibility for starting a war. [PJC] [1913 Webster]