The -fno-ugly-args option disables passing typeless and Hollerith constants as actual arguments in procedure invocations. For example:
CALL FOO(4HABCD) CALL BAR('123'O)
These constructs can be too easily used to create non-portable code, but are not considered as “ugly” as others. Further, they are widely used in existing Fortran source code in ways that often are quite portable. Therefore, they are enabled by default.