CERIDIAN CORPORATION 2004 LONG-TERM STOCK INCENTIVE PLAN Non-Qualified Stock Option Agreement

3.2                                 Termination of Service.  If Optionee’s services as a director of the Company ceases by reason of death, Disability or not standing for re-election to the Board, the Option shall become immediately exercisable in full and remain exercisable until the Time of Option Termination.  If Optionee voluntarily resigns from the Board (which does not include the submission of an offer not to stand re-election as a director in accordance with Company policies), Optionee shall have three months following the date of such cessation of service as a director to exercise this Option (but in no event after the Time of Option Termination), but only to the extent that Optionee was entitled to exercise it as of the date of such cessation.  If Optionee’s services as a director of the Company ceases for any reason other than those specified earlier in this section, this Option shall remain exercisable until the Time of Option Termination, but only to the extent that Optionee was entitled to exercise it as of the date of such cessation.

3.3                                 Impact of Change of Control.  If a Change of Control (as defined in Section 8 of this Agreement) occurs, the Option will become immediately exercisable in full and will, notwithstanding the provisions of Section 3.2 hereof, remain exercisable until the Time of Option Termination, regardless of whether the Optionee remains as a director of the Company.  In addition, if a Change of Control of the Company occurs, the Committee, in its sole discretion and without the consent of the Optionee, may determine that the Optionee will receive, with respect to some or all of the Option (and in satisfaction of the applicable portion of the Option), as of the effective date of any such Change of Control of the Company, cash in an amount equal to the excess of the Fair Market Value (as defined in the Plan) of the applicable Option Shares immediately prior to the effective date of such Change of Control of the Company over the Option Exercise Price per share of the Option.

4.                                       Manner of Option Exercise.

4.1                                 Notice.  This Option may be exercised by the Optionee in whole or in part from time to time, subject to the conditions contained in the Plan and in this Agreement, by delivery, in person, by facsimile or electronic transmission or through the mail, to the Company at its principal executive office in Minneapolis, Minnesota USA (Attention:  Corporate Treasury), of a written notice of exercise.  Such notice must be in a form satisfactory to the Committee, must identify the Option, must specify the number of Option Shares with respect to which the Option is being exercised, and must be signed by the person or persons so exercising the Option.  Such notice must be accompanied by payment in full of the total exercise price and any applicable taxes for the Option Shares to be purchased.  In the event that the Option is being exercised, as provided by the Plan and Section 3.2 of this Agreement, by any person or persons other than the Optionee, the notice must be accompanied by appropriate proof of right of such person or persons to exercise the Option.  If the Optionee retains the Option Shares purchased, as soon as practicable after the effective exercise of the Option, the Optionee will be recorded on the stock transfer books of the Company as the owner of the Option Shares purchased, and the Company will deliver to the Optionee one or more duly issued stock certificates evidencing such ownership.

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4.2                                 Payment.  At the time of exercise of the Option, the Optionee must pay the total exercise price of the Option Shares to be purchased entirely in cash (including a check, bank draft or money order, payable to the order of the Company); provided, however, that the Committee, in its sole discretion and upon terms and conditions established by the Committee, may allow such payment to be made, in whole or in part, by tender of a Broker Exercise Notice or Previously Acquired Shares (as such terms are defined in Section 8 of this Agreement), or by a combination of such methods.  In the event the Optionee is permitted to pay the total purchase price of the Option in whole or in part with Previously Acquired Shares, the value of such shares will be equal to their Fair Market Value on the date of exercise of the Option.  The delivery of any shares already owned by the Optionee may be made through delivery of a written attestation of ownership if permitted by the Committee.

5.                                       Rights and Restrictions of Optionee; Transferability.

5.1                                 Rights as a Stockholder.  The Optionee will have no rights as a stockholder unless and until all conditions to the effective exercise of the Option (including, without limitation, the conditions set forth in Sections 4 and 6 of this Agreement) have been satisfied and the Optionee has become the holder of record of such shares.  No adjustment will be made for dividends or distributions with respect to the Option Shares as to which there is a record date preceding the date the Optionee becomes the holder of record of such Option Shares, except as may otherwise be provided in the Plan or determined by the Committee in its sole discretion.

5.2                                 Restrictions on Transfer.  Except as otherwise provided by the Committee, neither the Option nor any rights under the Option shall be transferable by the Optionee other than by will or by the laws of descent and distribution.  The Committee may establish procedures as it deems appropriate for the Optionee to designate a Person or Persons, as beneficiary or beneficiaries, to exercise the rights of the Optionee and receive any property distributable with respect to the Option in the event of the Optionee’s death.  The Option shall be exercisable during the Optionee’s lifetime only by the Optionee or, if permissible under applicable law, by the Optionee’s guardian or legal representative.  Neither the Option nor any right under any the Option may be pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or encumbrance thereof shall be void and unenforceable against the Company or any Affiliate.

6.                                       Securities Law and Other Restrictions.