I don't see Ultra 7 listed on http://sheldonbrown.com/k7.html#spacing , but I assume it is spaced 4.8mm (Sun Tour 7-speed is listed as 4.8/5.0mm, maybe Ultra 7 is 4.8mm and 5.0mm is regular?).

If that's correct, an Ultra 7 should work, but you'll want to set up the shifter for Shimano 8-speed (also 4.8mm spacing)--just make sure that low-limit screw is set so the shifter can't get to its eighth position (lowest gear). I don't know how the Modolo shifters are set up; never tried 'em myself, but they're intriguing.