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                                                                    Exhibit 10.8

                      ASSOCIATES FIRST CAPITAL CORPORATION
                          INCENTIVE COMPENSATION PLAN
                (AMENDED AND RESTATED EFFECTIVE JANUARY 1, 1997)

ARTICLE 1.  PURPOSE AND DURATION

       1.1.  PURPOSE OF THE PLAN.  Associates First Capital Corporation, a
Delaware corporation, hereby amends and restates, effective January 1, 1997,
the Associates First Capital Corporation Incentive Compensation Plan (formerly
called the "Associates First Capital Corporation Long-Term Equity Compensation
Plan"), as set forth in this document, to allow the Company (a) to optimize the
profitability and growth of the Company through incentives that are consistent
with the Company's goals and that link the individual interests of Participants
with those of the Company's stockholders, (b) to provide Participants with an
incentive for excellence in individual performance, (c) to provide flexibility
to the Company in its ability to motivate, attract and retain the services of
Employees who make significant contributions to the Company's success, and (d)
to allow such Employees to share in the success of the Company.  The Plan
permits awards of Corporate Annual Performance Pay, Incentive Stock Options,
Nonqualified Stock Options, Performance Shares, Performance Units, Restricted
Stock and Stock Appreciation Rights.

       1.2.  DURATION OF THE PLAN.  On and after the Effective Date, subject to
approval by the Company's stockholders, the provisions of the amended and
restated Plan shall govern all Awards.  The Plan shall remain in effect
indefinitely, subject to the right of the Board of Directors to amend or
terminate the Plan at any time pursuant to Article 13, until all Awards are
satisfied by the issuance of Shares and/or the payment of cash.
Notwithstanding the foregoing, in no event may an Award be made on or after
March 31, 2006.

ARTICLE 2.  DEFINITIONS

       2.1.  GENERAL.  Whenever used in the Plan, the following terms shall
have the meanings set forth below, and when any such meaning is intended, the
initial letter of the word shall be capitalized.  Except where the context
otherwise indicates, any masculine term used herein shall include the feminine,
the plural shall include the singular, and the singular shall include the
plural.

       2.2.  "AWARD" means, individually or collectively, an award under the
Plan of Corporate Annual Performance Pay, Incentive Stock Options, Nonqualified
Stock Options, Performance Shares, Performance Units, Restricted Stock or Stock
Appreciation Rights.

       2.3.  "AWARD AGREEMENT" means an agreement, entered into between the
Company and a Participant, setting forth the terms and conditions applicable to
an Award.

       2.4.  "BOARD" or "BOARD OF DIRECTORS" means the board of directors of
the Company.
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       2.5.  "CLASS A COMMON STOCK" means the Class A Common Stock, par value
$.01 per share, of the Company.

       2.6.  "CODE" means the Internal Revenue Code of 1986, as amended from
time to time, or any successor thereto.

       2.7.  "COMMITTEE" means the Committee designated pursuant to Section
12.1 to administer the Plan.

       2.8.  "COMPANY" means Associates First Capital Corporation, a Delaware
corporation, and any successor thereto as provided in Section 14.5.

       2.9.  "CORPORATE ANNUAL PERFORMANCE PAY" or "CAPP" means annual
incentive compensation awarded under Article 5.

       2.10.  "DIRECTOR" means any individual who is a member of the Board of
Directors.

       2.11.  "EFFECTIVE DATE" means January 1, 1997, as provided in Section
1.1.  The original effective date of the Plan was April 1, 1996.

       2.12.  "EMPLOYEE" means any individual who is a full-time, active
employee of the Company or any Subsidiary.

       2.13.  "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor thereto.

       2.14.  "FAIR MARKET VALUE" means the closing sale price at which Shares
were sold regular way on the relevant date on the principal securities exchange
on which Shares were traded on such date or, if there was no sale on the
relevant date, then on the last previous day on which there was such a sale;
provided that "Fair Market Value" for any Awards made concurrent with or
contingent upon the consummation of the initial public offering of Shares in
1996 means the initial public offering price of Shares covered by such initial
public offering.

       2.15.  "FREESTANDING SAR" means an SAR, awarded under Article 9, that is
granted independently of any Option.

       2.16.  "INCENTIVE STOCK OPTION" or "ISO" means an option to purchase
Shares, awarded under Article 6, that is intended to qualify as an "incentive
stock option" within the meaning of Code Section 422.

       2.17.  "INSIDER" means an individual who is, on the relevant date, an
officer or Director of the Company or a beneficial owner (as the term
"beneficial owner" is defined in Rule 13d-3 of the General Rules and
Regulations promulgated under the Exchange Act) of 10 percent (10%) or more of
any class of the Company's equity securities that is registered pursuant to
Section 12 of
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the Exchange Act, as such terms are used under Section 16 of the Exchange Act
and the General Rules and Regulations promulgated thereunder.

       2.18.  "NAMED EXECUTIVE OFFICER" means an individual who, as of the date
of payment, exercise and/or lapse of restrictions with respect to an Award, as
applicable, is a "covered employee" as defined in Code Section 162(m) and the
Treasury Regulations promulgated thereunder.

       2.19.  "NON-EMPLOYEE DIRECTOR" means a Director who is not an Employee
of the Company or any Subsidiary or of Ford Motor Company or any of its direct
or indirect subsidiaries.

       2.20.  "NONQUALIFIED STOCK OPTION" or "NQSO" means an option to purchase
Shares, awarded under Article 6, that is not intended to be treated as an
"incentive stock option" within the meaning of Code Section 422.

       2.21.  "OPTION" means an Incentive Stock Option or a Nonqualified Stock
Option, as applicable.

       2.22.  "OPTION PRICE" means the price at which a Share may be purchased
by a Participant pursuant to an Option.

       2.23.  "PARTICIPANT" means an Employee selected pursuant to Article 4 to
receive an Award.

       2.24.  "PERFORMANCE-BASED EXCEPTION" means the performance-based
compensation exception from the tax deductibility limitations of Code Section
162(m).

       2.25.  "PERFORMANCE SHARE" means a performance-based grant, awarded
under Article 7, the initial value of which is based on the Fair Market Value
of a Share on the date of grant.

       2.26.  "PERFORMANCE UNIT" means a performance-based grant, awarded under
Article 7, the initial value of which is established by the Committee at the
time of grant.

       2.27.  "PLAN" means the Associates First Capital Corporation Incentive
Compensation Plan (formerly called the "Associates First Capital Corporation
Long-Term Equity Compensation Plan"), as amended and restated effective January
1, 1997.

       2.28.  "RESTRICTED STOCK" means Class A Common Stock, awarded under
Article 8, that is subject to restrictions on transferability and to a
substantial risk of forfeiture.

       2.29.  "SHARES" means shares of Class A Common Stock.
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       2.30.  "STOCK APPRECIATION RIGHT" or "SAR" means a right, awarded under
Article 9, either alone or in connection with an Option, to receive the value
of the appreciation over time in the value of a Share. An SAR may be either a
Freestanding SAR or a Tandem SAR.

       2.31.  "SUBSIDIARY" means any corporation, partnership, joint venture or
other entity in which the Company has a direct or indirect majority voting
interest (including all divisions, affiliates and related entities), provided
that for ISOs "Subsidiary" has the meaning set forth in Code Section 422.

       2.32.  "TANDEM SAR" means an SAR, awarded under Article 9 in connection
with an Option, the exercise of which forfeits the right to purchase a Share
under the related Option (and which SAR is itself forfeited if and when a Share
is purchased under the related Option).

ARTICLE 3.  SHARES SUBJECT TO THE PLAN AND MAXIMUM AWARDS

       3.1.  NUMBER OF SHARES AVAILABLE FOR GRANTS.  Subject to adjustment as
provided in Section 3.3, the maximum number of Shares with respect to which
Awards may be made shall be 20,799,268.  Shares issued under the Plan may be
either authorized but unissued Shares, treasury Shares or any combination
thereof.

       3.2.  LAPSED AWARDS.  If any Award is canceled, terminates, expires or
lapses for any reason without the issuance of Shares or payment in respect
thereof (with the exceptions of termination of a Tandem SAR upon exercise of
the related Option or termination of an Option upon exercise of the related
Tandem SAR), any Shares subject to such Award shall be available again for an
Award to the fullest extent permitted under Rule 16b-3 of the General Rules and
Regulations promulgated under the Exchange Act and Code Sections 162(m) and
422.

       3.3.  ADJUSTMENTS IN AUTHORIZED SHARES.  In the event of any change in
capitalization of the Company (such as a stock split, stock dividend or
combination of shares), corporate transaction (such as any merger,
consolidation, separation, including a spin-off, or other distribution of stock
or property of the Company), reorganization (whether or not such reorganization
comes within the definition of such term in Code Section 368) or partial or
complete liquidation of the Company, an adjustment shall be made in the number
and class of Shares with respect to which Awards may be made, in the number and
class of and/or price of Shares subject to outstanding Awards, and in the Award
limits set forth with respect to Options and SARs in Section 3.4, as may be
determined to be appropriate and equitable by the Committee, in its sole
discretion, to reflect such change in capitalization, corporate transaction,
reorganization or partial or complete liquidation; provided, however, that the
number of Shares subject to any Award shall always be a whole number.

       3.4.  MAXIMUM AWARDS.  The maximum aggregate number of Shares with
respect to which Options, with or without Tandem SARs, or Freestanding SARs may
be awarded to any one individual under the Plan in any one calendar year shall
be 400,000.  The maximum Corporate
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Annual Performance Pay that may be awarded to any one individual under the Plan
in any one calendar year shall be $5,000,000.

ARTICLE 4.  ELIGIBILITY AND PARTICIPATION

       4.1.  ELIGIBILITY.  Any officer of the Company or salaried Employee,
including any Employee who is a Director, with potential to contribute to the
success of the Company and/or any Subsidiary shall be eligible to be selected
as a Participant by the Committee.

       4.2.  PARTICIPATION.  Subject to the provisions of the Plan, the
Committee shall, from time to time and in its sole discretion, select from
among all eligible Employees, as specified in Section 4.1, those to whom Awards
shall be made and shall determine the nature, amount, terms and conditions of
each Award.

ARTICLE 5.  CORPORATE ANNUAL PERFORMANCE PAY

       5.1.  GENERAL.  Subject to the provisions of the Plan, the Committee may
award Corporate Annual Performance Pay to a Participant at any time and from
time to time in such amount and upon such terms and conditions as the Committee
may determine.

       5.2.  DETERMINATION OF CAPP INCENTIVE POOLS.  Corporate Annual
Performance Pay shall be payable each year from two incentive pools, one of
which shall fund CAPP Awards solely to the Named Executive Officers (the "Named
Executive Officers' Incentive Pool") and the other of which shall fund CAPP
Awards solely to Participants other than the Named Executive Officers (the
"General Incentive Pool").  The amount of the Named Executive Officers'
Incentive Pool shall be determined by multiplying (a) a fixed base amount,
established by the Committee concurrent with establishment of performance
targets pursuant to Section 5.3, by (b) a performance percentage determined by
reference to the Company's achievement of the performance targets established
by the Committee pursuant to Section 5.3.  The Committee shall determine the
amount of the General Incentive Pool in its discretion.

       5.3.  PERFORMANCE MEASURES AND TARGETS.  The Committee shall establish
each year, within the first 90 days of such year, performance targets that must
be achieved in order for CAPP Awards to be payable to the Named Executive
Officers.  Such performance targets shall be based upon one or more performance
measures, which the Committee shall select (concurrent with establishing each
year's performance targets) from among profits, net income (either before or
after taxes), share price, earnings per share, total stockholder return, return
on assets, return on equity, operating income, return on capital or
investments, or economic value added.  At the same time the Committee selects
performance measures and specifies performance targets, the Committee shall
also determine the manner in which such performance measure(s) shall be
calculated or measured, including the extent to which such measure(s) shall be
adjusted to take into account certain factors over which Participants have no
or limited control, including, without limitation, changes in accounting
principles and extraordinary charges to income.
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       5.4.  DETERMINATION OF CAPP AWARDS TO NAMED EXECUTIVE OFFICERS.  The
Committee shall specify each year, concurrent with establishing performance
measure(s) and targets pursuant to Section 5.3, the percentage of the Named
Executive Officers' Incentive Pool that shall be payable to each Named
Executive Officer as a CAPP Award for that year, subject to the maximum CAPP
Award limit specified in Section 3.4 and subject to the Committee's exercise of
negative discretion to adjust downward any such CAPP Award.

       5.5.  DETERMINATION OF CAPP AWARDS TO OTHER PARTICIPANTS.  The Committee
shall determine the CAPP Award, if any, payable from the General Incentive Pool
to each Participant who is not a Named Executive Officer.

       5.6.  PAYMENT OF CAPP AWARDS.  CAPP Awards shall be payable to
Participants at such time(s) and in cash or in Shares of equivalent value or in
some combination thereof, as the Committee shall determine.

       5.7.  TERMINATION OF EMPLOYMENT.  The Committee shall determine if, and
the extent to which, any Participant shall have the right to receive payment of
a CAPP Award following termination of the Participant's employment with the
Company or any Subsidiary.  Any determinations under this Section shall be made
in the sole discretion of the Committee, need not be uniform among all CAPP
Awards and may reflect distinctions based on the reasons for termination of
employment.

       5.8.  NONTRANSFERABILITY OF CAPP AWARD.  No right to a CAPP Award may be
sold, transferred, pledged, assigned or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution.

ARTICLE 6.  INCENTIVE AND NONQUALIFIED STOCK OPTIONS

       6.1.  GENERAL.  Subject to the provisions of the Plan, the Committee may
award Options to a Participant at any time and from time to time in such number
and upon such terms and conditions as the Committee may determine.

       6.2.  OPTION AWARD AGREEMENT.  Each Award of an Option shall be
evidenced by an Award Agreement that shall specify the Option Price, the
duration of the Option, the number of Shares that may be purchased pursuant to
exercise of the Option and such other terms and conditions as the Committee may
determine.  The Award Agreement also shall specify whether the Option is
intended to qualify as an "incentive stock option" within the meaning of, and
be governed by, Code Section 422 or a NQSO not intended to be treated as an
"incentive stock option" within the meaning of Code Section 422.

       6.3.  OPTION PRICE.  The Option Price for each Award of an Option shall
be at least equal to 100 percent (100%) of the Fair Market Value of a Share on
the Option's date of grant.
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       6.4.  DURATION OF OPTIONS.  Each Option shall expire at such time as the
Committee shall determine at the time of grant; provided, however, that no
Option shall be exercisable later than the 10th anniversary of the Option's
date of grant.

       6.5.  EXERCISE OF OPTIONS.  Each Option shall be exercisable at such
time(s) and in such manner and subject to such conditions as the Committee
shall in each instance determine, which need not be the same for each Award or
for each Participant.

       6.6.  PAYMENT OF OPTION PRICE.  The aggregate Option Price shall be
payable in full upon exercise of any Option either (a) in cash in the form of
currency or check or other cash equivalent acceptable to the Company; (b) by
tendering previously acquired, nonforfeitable, nonrestricted Shares having an
aggregate fair market value at the time of exercise equal to the aggregate
Option Price (provided that any Shares so tendered must have been owned by the
Participant for at least six (6) months prior to their tender); or (c) by a
combination of the foregoing methods.  The Committee may permit a Participant
to satisfy the requirement of payment in cash from the proceeds of a sale
through a broker of some or all of the Shares to which the exercise relates (a
"cashless exercise"), subject to applicable securities laws restrictions, or by
any other means that the Committee determines to be consistent with the Plan's
purpose and applicable law.

       6.7.  PAYMENT OF SHARES OR PROCEEDS.  As soon as practicable after
exercise of an Option is completed, the Company shall deliver the Shares
purchased to the Participant; provided, however, that if the Committee permits
cashless exercise of Options, a Participant may elect to receive the cash
proceeds from the cashless exercise in lieu of Shares.

       6.8.  TERMINATION OF EMPLOYMENT.  Each Participant's Option Award
Agreement shall set forth if, and the extent to which, the Participant shall
have the right to exercise the Option following termination of the
Participant's employment with the Company or any Subsidiary.  Such terms and
conditions shall be determined in the sole discretion of the Committee, need
not be uniform among all Option Awards and may reflect distinctions based on
the reasons for termination of employment.

       6.9.  NONTRANSFERABILITY OF OPTIONS.  Except as otherwise provided in a
Participant's Option Award Agreement with respect to NQSOs, (a) ISOs and NQSOs
shall be exercisable during a Participant's lifetime only by the Participant
or, in the event of the Participant's legal incapacity, by the Participant's
legal guardian or representative acting in a fiduciary capacity on behalf of
the Participant under state law and court supervision, and (b) no ISO or NQSO
may be sold, transferred, pledged, assigned or otherwise alienated or
hypothecated, other than by will or by the laws of descent and distribution.

ARTICLE 7.  PERFORMANCE SHARES AND PERFORMANCE UNITS

       7.1.  GENERAL.  Subject to the provisions of the Plan, the Committee may
award Performance Shares and/or Performance Units to a Participant at any time
and from time to time in such number and upon such terms and conditions as the
Committee may determine.
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       7.2.  PERFORMANCE SHARES/UNITS AWARD AGREEMENT.  Each Award of
Performance Shares and/or Performance Units shall be evidenced by an Award
Agreement that shall specify the initial value of such Performance Shares
and/or Performance Units, the time period during which preestablished
performance goals must be met (the "Performance Period"), the performance goals
upon which payment of such Performance Shares and/or Performance Units depends
(the "Performance Goals"), the number of Performance Shares and/or Performance
Units awarded and such other terms and conditions as the Committee may
determine.

       7.3.  INITIAL VALUE OF PERFORMANCE SHARES/UNITS.  The initial value of
each Performance Share shall equal the Fair Market Value of a Share on the
Performance Share's date of grant. The Committee shall establish the initial
value of each Performance Unit at the time of grant.

       7.4. DURATION OF PERFORMANCE SHARES/UNITS AWARDS.  Each Award of
Performance Shares and/or Performance Units shall expire at the end of the
applicable Performance Period, without payment of the Performance Shares or
Performance Units, if the Performance Goals established for that Performance
Period have not been achieved during such Performance Period.

       7.5.  SATISFACTION OF PERFORMANCE GOALS.  The Committee shall determine
at the end of each Performance Period if, and the extent to which, the
applicable Performance Goals have been achieved.

       7.6.  PAYMENT OF PERFORMANCE SHARES/UNITS.  As soon as practicable after
the end of a Performance Period, if the applicable Performance Goals for that
Performance Period have been achieved (as determined by the Committee pursuant
to Section 7.5), the Company shall deliver to a Participant payment for such
Participant's Performance Shares and/or Performance Units in an amount
determined, as specified in such Participant's Performance Share and/or Unit
Award Agreement, on the last day of the Performance Period by reference to the
achievement of the applicable Performance Goals.  The Committee may permit a
Participant to elect payment of the aggregate value of such Participant's
Performance Shares and/or Performance Units in cash or in Shares of equivalent
value or in some combination thereof, subject to the availability of Shares to
the Company.  If, and to the extent that, dividends with respect to Shares are
declared or paid during the Performance Period, the Committee may direct
payment of dividend equivalents to a Participant in an amount equal to the
dividends that such Participant would receive or have received if such
Participant's Performance Shares were Shares; provided, however, that such
dividend equivalents shall be subject to the same restrictions as apply to
dividends payable with respect to Restricted Stock pursuant to Section 8.4.

       7.7.  TERMINATION OF EMPLOYMENT.  Each Participant's Performance Share
and/or Unit Award Agreement shall set forth if, and the extent to which, the
Participant shall have the right to receive payment of Performance Shares
and/or Performance Units following termination of the Participant's employment
with the Company or any Subsidiary.  Such terms and conditions shall be
determined in the sole discretion of the Committee, need not be uniform among
all Performance Share and/or Performance Unit Awards and may reflect
distinctions based on the reasons for termination of employment.
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       7.8.  NONTRANSFERABILITY OF PERFORMANCE SHARES/UNITS.  Except as
otherwise provided in a Participant's Performance Share and/or Unit Award
Agreement, (a) all rights with respect to Performance Shares and/or Performance
Units shall be exercisable during a Participant's lifetime only by the
Participant or, in the event of the Participant's legal incapacity, by the
Participant's legal guardian or representative acting in a fiduciary capacity
on behalf of the Participant under state law or court supervision, and (b) no
Performance Shares or Performance Units may be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution.

ARTICLE 8.  RESTRICTED STOCK

       8.1.  GENERAL.  Subject to the provisions of the Plan, the Committee may
award Restricted Stock to a Participant at any time and from time to time in
such number and upon such terms and conditions as the Committee may determine.

       8.2.  RESTRICTED STOCK AWARD AGREEMENT.  Each Award of Restricted Stock
shall be evidenced by an Award Agreement that shall specify the restrictions
that limit transferability of the Restricted Stock and create a substantial
risk of forfeiture (the "Restrictions"), the time period during which such
Restrictions apply (the "Period of Restriction"), the number of Shares of
Restricted Stock awarded and such other terms and conditions as the Committee
may determine (which may, but are not required to, include a stipulated
purchase price for each Share of Restricted Stock).

       8.3.  ISSUANCE OF SHARES OF RESTRICTED STOCK.  Certificates representing
Restricted Stock shall be issued on the Restricted Stock's date of grant in the
name of each Participant to whom the Committee awards such Restricted Stock.
Certificates so issued shall be retained by the Company or its designee during
the applicable Period of Restriction.

       8.4.  DIVIDENDS AND VOTING RIGHTS DURING PERIOD OF RESTRICTION.  During
the applicable Period of Restriction, each Participant to whom the Committee
has awarded Restricted Stock may receive regular cash dividends, if any, paid
with respect to the Restricted Stock; provided, however, that the Committee may
apply any restrictions to such dividends that the Committee deems appropriate.
In the event that any dividend constitutes a "derivative security" or an
"equity security" within the meaning of Rule 16(a) of the General Rules and
Regulations promulgated under the Exchange Act, such dividend shall be subject
to a period of restriction equal to the remaining Period of Restriction
applicable to the Restricted Stock with respect to which the dividend has been
paid.  Each Participant to whom the Committee has awarded Restricted Stock may
exercise full voting rights during the Period of Restriction with respect to
such Participant's Restricted Stock.

       8.5.  LAPSE OF RESTRICTIONS.  Restrictions on Restricted Stock shall
lapse at such time(s) and in such manner and subject to such conditions as the
Committee shall in each instance
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determine, which need not be the same for each Award or for each Participant.
Restricted Stock shall become freely transferable by the Participant upon the
lapse of all Restrictions on such Restricted Stock.

       8.6.  TERMINATION OF EMPLOYMENT.  Each Participant's Restricted Stock
Award Agreement shall set forth if, and the extent to which, Restrictions on a
Participant's Restricted Stock shall lapse following termination of the
Participant's employment with the Company or any Subsidiary.  Such terms and
conditions shall be determined in the sole discretion of the Committee, need
not be uniform among all Restricted Stock Awards and may reflect distinctions
based on the reasons for termination of employment.

       8.7.  NONTRANSFERABILITY OF RESTRICTED STOCK.  Except as otherwise
provided in a Participant's Restricted Stock Award Agreement, (a) all rights
with respect to Restricted Stock shall be available during a Participant's
lifetime only to the Participant or, in the event of the Participant's legal
incapacity, to the Participant's legal guardian or representative acting in a
fiduciary capacity on behalf of the Participant under state law or court
supervision, and (b) no Restricted Stock may be sold, transferred, pledged,
assigned or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution, during the applicable Period of Restriction.

ARTICLE 9.  STOCK APPRECIATION RIGHTS

       9.1.  GENERAL.  Subject to the provisions of the Plan, the Committee may
award SARs to a Participant at any time and from time to time in such number
and upon such terms and conditions as the Committee may determine.

       9.2.  SAR AWARD AGREEMENT.  Each Award of an SAR shall be evidenced by
an Award Agreement that shall specify the grant price of the SAR, the duration
of the SAR, the number of Shares to which the SAR pertains and such other terms
and conditions as the Committee may determine.  The Award Agreement also shall
specify whether the SAR is a Freestanding SAR or a Tandem SAR.

       9.3.  GRANT PRICE.  The grant price for each Award of a Freestanding SAR
shall equal the Fair Market Value of a Share on the Freestanding SAR's date of
grant.  The grant price for each Award of a Tandem SAR shall equal the Option
Price of the related Option.

       9.4.  DURATION OF SARS.  Each SAR shall expire at such time as the
Committee shall determine at the time of grant; provided, however, that no SAR
shall be exercisable later than the 10th anniversary of such SAR's date of
grant and provided, further, that a Tandem SAR awarded in connection with an
ISO shall expire no later than the date of expiration of the related ISO.

       9.5.  EXERCISE OF SARS.  Each SAR shall be exercisable at such time(s)
and in such manner and subject to such conditions as the Committee shall in
each instance determine, which need not be the same for each Award or for each
Participant.  A Tandem SAR may be exercised
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for all or a portion of the Shares subject to the related Option upon the
surrender of the right to exercise the equivalent portion of the related
Option; provided, however, that a Tandem SAR may be exercised only with respect
to the Shares with respect to which its related Option is then exercisable and
provided, further, that a Tandem SAR awarded in connection with an ISO may be
exercised only when the Fair Market Value of the Shares subject to the related
ISO exceeds the ISO's Option Price.

       9.6.  PAYMENT OF SHARES OR PROCEEDS.  As soon as practicable after
exercise of an SAR, the Company shall deliver to the Participant payment in an
amount equal to the aggregate appreciation in value of the Shares with respect
to which the SAR was exercised, such appreciation to be measured by the
difference between the aggregate grant price and the aggregate fair market
value of such Shares on the date of exercise; provided that, with respect to a
Tandem SAR awarded in connection with an ISO, the value of the amount payable
upon exercise of the Tandem SAR may not exceed 100 percent (100%) of the
difference between the aggregate Option Price of the related ISO and the
aggregate fair market value of the Shares subject to the related ISO at the
time the Tandem SAR is exercised.  The Committee may permit a Participant to
elect payment of the aggregate appreciation in cash or in Shares of equivalent
value or in some combination thereof, subject to the availability of Shares to
the Company.

       9.7.  TERMINATION OF EMPLOYMENT.  Each Participant's SAR Award Agreement
shall set forth if, and the extent to which, the Participant shall have the
right to exercise the SAR following termination of the Participant's employment
with the Company or any Subsidiary. Such terms and conditions shall be
determined in the sole discretion of the Committee, need not be uniform among
all SAR Awards and may reflect distinctions based on the reasons for
termination of employment.

       9.8.  NONTRANSFERABILITY OF SARS.  Except as otherwise provided in a
Participant's SAR Award Agreement, (a) all SARs shall be exercisable during a
Participant's lifetime only by the Participant or, in the event of the
Participant's legal incapacity, by the Participant's legal guardian or
representative acting in a fiduciary capacity on behalf of the Participant
under state law or court supervision, and (b) no SAR may be sold, transferred,
pledged, assigned or otherwise alienated or hypothecated, other than by will or
by the laws of descent and distribution.

ARTICLE 10.  COMPLIANCE WITH APPLICABLE LAWS, RULES AND REGULATIONS

       10.1.  GENERAL.  Awards and Shares issued or transferred pursuant to
Awards shall be subject to all applicable laws, rules and regulations and to
such approvals by any governmental agencies or national securities exchanges as
may be required.

       10.2.  RESTRICTIONS ON SHARES.  The Committee may impose such
restrictions, including restrictions on transferability, on Awards and/or
Shares issued or transferred pursuant to any Award as the Committee may deem
advisable, including, without limitation, restrictions under United States
federal securities laws or other applicable securities laws, under the
requirements of
<PAGE>   12
any securities exchange or market upon which Shares are then listed and/or
traded and/or under any blue sky or state securities laws applicable to Shares.

       10.3.  RESTRICTIONS ON INSIDERS.  With respect to Insiders, transactions
under the Plan are intended to comply with all applicable conditions of Rule
16b-3 of the General Rules and Regulations promulgated under the Exchange Act.
To the extent any provision of the Plan or action by the Committee fails to so
comply, such provision or action shall be deemed null and void, to the extent
permitted by law and deemed advisable by the Committee.

ARTICLE 11.  DEFERRALS

       The Committee may permit or require a Participant to defer such
Participant's receipt of the payment of cash or the delivery of Shares that
would otherwise be due to such Participant under the Plan.  If any such
deferral election is required or permitted, the Committee shall establish rules
and procedures for such payment deferrals.

ARTICLE 12.  ADMINISTRATION

       12.1.  DESIGNATION OF COMMITTEE.  The Plan shall be administered by a
committee consisting of not fewer than two Non-Employee Directors, each of whom
qualifies as an "outside director" within the meaning of Code Section 162(m),
which committee shall be the Compensation Committee of the Board (provided that
its members so qualify) unless the Board specifically appoints a different
committee to administer the Plan.

       12.2.  AUTHORITY OF THE COMMITTEE.  Except as limited by law or by the
Certificate of Incorporation or Bylaws of the Company, and subject to the
provisions of the Plan, the Committee shall have full power and authority, in
its sole discretion, to (a) select Participants from among all eligible
Employees and determine the nature, amount, terms and conditions of Awards in a
manner consistent with the Plan; (b) make Awards to Participants; (c) construe
and interpret the Plan and any agreement or instrument entered into under the
Plan; (d) adopt, amend, waive or rescind such rules and regulations as the
Committee may deem appropriate for the proper administration or operation of
the Plan; (e) subject to the provisions of Article 13, amend the terms and
conditions of any outstanding Award to the extent such terms and conditions are
within the discretion of the Committee as provided in the Plan; and (f) make
all other determinations and take all other actions as may be necessary,
appropriate or advisable for the administration or operation of the Plan.  As
permitted by law, the Committee may delegate its authority, or any part
thereof, as it deems necessary, appropriate or advisable for proper
administration or operation of the Plan; provided, however, that no such
delegation shall be permitted if, and to the extent that, such delegation would
cause an Award designed to qualify for the Performance-Based Exception to fail
to so qualify.

       12.3.  DECISIONS BINDING.  All determinations, interpretations,
decisions or other actions made or taken by the Committee pursuant to the
provisions of the Plan and all related orders and resolutions of the Board
shall be final, conclusive and binding for all purposes and upon all
<PAGE>   13
persons, including without limitation the Company, its stockholders, Employees,
Participants, and Participants' estates and beneficiaries.

ARTICLE 13.  AMENDMENT, ADJUSTMENT AND TERMINATION

       13.1.  AMENDMENT AND TERMINATION.  Subject to Section 13.3, the Board
may at any time, and from time to time, in its sole discretion alter, amend,
suspend or terminate the Plan in whole or in part for any reason or for no
reason; provided, however, that no amendment or other action that requires
stockholder approval in order for the Plan to continue to comply with
applicable law shall be effective unless such amendment or other action shall
be approved by the requisite vote of stockholders of the Company entitled to
vote thereon.

       13.2.  ADJUSTMENT OF AWARDS.  Subject to Section 13.3, the Committee may
make adjustments to Awards and in the terms and conditions of, and the criteria
included in, Award Agreements in recognition of (a) unusual or nonrecurring
events (including, without limitation, the events described in Section 3.3)
affecting the Company or the financial statements of the Company, and/or (b)
changes in applicable laws, regulations or accounting principles whenever the
Committee determines that such adjustments are appropriate; provided, however,
that no such adjustment shall be made or authorized to the extent that such
adjustment or authority would cause any Award designed to qualify for the
Performance-Based Exception to fail to so qualify.

       13.3.  AWARDS PREVIOUSLY GRANTED.  No alteration, amendment, suspension
or termination of the Plan shall adversely affect in any material way any Award
previously made under the Plan without the written consent of the affected
Participant; provided, however, that the Committee may modify, without a
Participant's consent, any Award previously made to a Participant who is a
foreign national or employed outside the United States to recognize differences
in local law, tax policy or custom.

ARTICLE 14.  MISCELLANEOUS

       14.1.  NO RIGHTS TO EMPLOYMENT.  Nothing in the Plan shall interfere
with or limit in any way the right of the Company to terminate the employment
of any Employee, whether or not a Participant, at any time; nor shall anything
in the Plan be deemed to create or confer upon any Employee, whether or not a
Participant, or other individual, any rights to employment of any kind or
nature whatsoever for any period of time or at any particular rate of
compensation, including, without limitation, any right to continue in the
employ of the Company.

       14.2.  NO RIGHTS TO PARTICIPATION.  No Employee, whether or not a
Participant, or other individual shall have any right to be selected to receive
an Award or, having been so selected, to be selected to receive a future Award;
nor shall anything in the Plan be deemed to create or confer upon any Employee,
whether or not a Participant, or other individual any such right.

       14.3.  WITHHOLDING.  The Company shall have the power and the right to
deduct or withhold from any amount to be paid to any Participant or beneficiary
hereunder, or require such
<PAGE>   14
a Participant or beneficiary to remit to the Company, an amount sufficient to
satisfy any federal, state and/or local taxes, domestic or foreign, required by
applicable law or regulation to be withheld with respect to any taxable event
arising as a result of the Plan.  The Company may permit a Participant or
beneficiary to elect to satisfy any withholding requirement with respect to an
Award, in whole or in part, either by surrendering to the Company (either
directly or through its designee) a portion of the Shares issued or transferred
to the Participant or beneficiary pursuant to that Award or by tendering
previously acquired, nonforfeitable, nonrestricted shares (provided that any
Shares so tendered by a Participant must have been owned by the Participant for
at least six (6) months prior to their tender); provided, however, that any
such election by an Insider shall be subject to express approval by the
Committee if such approval is then required by Rule 16b-3 of the General Rules
and Regulations promulgated under the Exchange Act. To the extent that a
Participant or beneficiary satisfies any withholding requirement by
surrendering or tendering Shares, the Shares so surrendered or tendered shall
be credited against any such withholding requirement at the fair market value
per Share on the date of such surrender or tender.  All withholding elections
shall be irrevocable, made in writing and signed by the Participant, and shall
be subject to any restrictions or limitations that the Committee deems
appropriate.

       14.4.  DESIGNATION OF BENEFICIARY.  A Participant may designate a
beneficiary or beneficiaries (who may be named contingently or successively)
who, in the event of the Participant's death prior to payment, exercise or
lapse of restrictions with respect to any Awards to such Participant, shall be
entitled to exercise any unexercised Options or SARs, receive any Restricted
Stock and receive payment of any CAPP Award, Performance Shares and/or
Performance Units, subject in each case to the terms and conditions of the
Participant's Award Agreement, as applicable.  Any such beneficiary designation
shall be made by the Participant in writing (on the appropriate form as
provided by the Company) and shall automatically revoke all prior designations
by such Participant.  The Participant may, at any time and from time to time,
change or revoke such designation.  A beneficiary designation, or revocation of
a prior beneficiary designation, will be effective only if it is signed by the
Participant and received by the Company prior to the Participant's death.  If
the Participant does not designate a beneficiary or all beneficiaries die prior
to payment, exercise or lapse of restrictions with respect to an Award, the
Participant's estate shall be the beneficiary.  If a beneficiary dies after at
least partial payment, exercise, or lapse of restrictions with respect to an
Award, the beneficiary's estate shall be the beneficiary of any remaining
payments or unexercised rights.

       14.5.  SUCCESSORS.  All obligations of the Company under the Plan with
respect to Awards shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the
business and/or assets of the Company.

       14.6.  SEVERABILITY.  In the event any provision of the Plan shall be
held illegal or invalid for any reason, the illegality or invalidity shall not
affect the remaining parts of the Plan, and the Plan shall be construed and
enforced as though the illegal or invalid provision had not been included.
<PAGE>   15
       14.7.  APPROVAL BY STOCKHOLDERS.  Notwithstanding any other provision of
the Plan to the contrary, under no circumstances shall any Award to a Named
Executive Officer, or to an individual whom the Committee considers likely to
become a Named Executive Officer, be made under the Plan on or after the date
of the first annual meeting of the Company's stockholders following the
Effective Date unless the Company's stockholders approve the material terms of
the Plan at such meeting.

       14.8.  GOVERNING LAW.  To the extent not preempted by United States
federal law or other comparable law, the Plan and all agreements hereunder,
including Award Agreements, shall be construed in accordance with and governed
by the laws of the State of Texas.

       IN WITNESS WHEREOF, this document is executed as of this 23rd day of
May, 1997.


                                           ASSOCIATES FIRST CAPITAL CORPORATION


                                           By:                                
                                              --------------------------------
                                                                              
                                           Name: James B. Watts               
                                                ------------------------------
                                                                              
                                           Title:   Executive Vice President  
                                                 -----------------------------