That's what Narwhal dev had publicly offered previously, there's no firm confirmation that's actually the deal and I'd be a little surprised if it was.
I think Reddit chose to give them a sweetheart deal because they're the worst competitor app, the dev had been least publicly critical of the API changes, and Reddit wants the PR value of an example case "proving" their API changes weren't maliciously anticompetitive towards third-party apps.
The fact that Narwhal has struck a deal now allows Reddit Inc to say "see! we do work with third party apps; it's not that we're bad, it's that RIF and Apollo are big meanies who won't cooperate!"
As Apollo and other apps close down, Narwhal seemingly agrees to one-off deal with Reddit to stay in business (9to5mac.com)