The Company recognized the following share-based compensation expense in selling, general and administrative expenses in its Condensed Consolidated Statement of Income for the three and six months ended June 30, 2014 and the three and six months ended June 30, 2013:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2014		2013		2014		2013
Stock options	$	171	$	138	$	321	$	238
Nonvested stock awards and restricted stock units		609		528		1,165		911
Employee stock purchase plan		19		14		36		26
Non-elective and elective 401(k) matching contribution in stock		499		411		1,148		936
Director stock ownership plan		46		21		62		41
Total share-based compensation expense	$	1,344	$	1,112	$	2,732	$	2,152

As of June 30, 2014 and June 30, 2013, the Company recorded $267 and $452, respectively, of excess tax benefits in capital in excess of par value on its Condensed Consolidated Balance Sheets related to stock option exercises. The Company's estimated taxes payable was sufficient to fully recognize these benefits as cash inflows from financing activities in its Condensed Consolidated Statement of Cash Flows, which represented the Company's estimate of cash savings through the six months ended June 30, 2014 and June 30, 2013, respectively.

					Weighted
					Average
			Weighted Average		Remaining
		Number of	Exercise Price per		Contractual
		Shares	Share		Term (years)
Options outstanding at December 31, 2013		75,251	$	44.49
	Options granted	37,048		73.47
	Options exercised	(3,292)		42.24
Options outstanding at June 30, 2014		109,007	$	54.41		5.4
Options exercisable at June 30, 2014		40,628	$	39.76		4.3

As of June 30, 2014, the total intrinsic value of options outstanding was approximately $2,378, and the total intrinsic value of exercisable options was $1,482. Intrinsic value is calculated as the difference between the current market price of the underlying security and the strike price of a related option.

A summary of the Company's outstanding stock options at June 30, 2014 is as follows:

						Weighted	Weighted		Number	Weighted
					Number	Average	Average		Exercisable	Average
Range of					Outstanding	Contractual	Exercise		at	Exercise
Exercise Prices					at 6/30/2014	Life	Price		6/30/2014	Price
$	0.00	-	$	10.00	0	0	$	0	0	$	0
$	10.01	-	$	20.00	6,155	2.6		18.82	6,155		18.82
$	20.01	-	$	30.00	0	0		0	0		0
$	30.01	-	$	40.00	35,020	4.3		37.87	23,954		37.75
$	40.01	-	$	50.00	2,192	5.0		46.21	1,462		46.21
$	50.01	-	$	60.00	28,592	5.7		58.26	9,057		58.26
$	60.01	-	$	70.00	0	0.0		0	0		0
$	70.01	-	$	80.00	37,048	6.7		73.47	0		0
					109,007	5.4		54.41	40,628		39.76

As of June 30, 2014, unrecognized compensation expense related to options granted during 2012 was $140, for options granted during 2013 was $358 and for options granted in 2014 was $726.

During the first quarter of 2014, the Company granted stock options under its LTIP plan that are subject only to time vesting over a three-year period. For the purposes of determining the fair value of stock option awards, the Company uses the Black-Scholes option pricing model and the assumptions set forth in the table below:

	2014
Number of options granted	37,048
Dividend yield	2.00	%
Expected volatility	43.34	%
Risk-free interest rate	1.22	%
Expected term (years)	4.0

Approximately $68 and $91 of expense was recorded on these options during the three and six months ended June 30, 2014, respectively. The fair value of these awards is amortized on a straight-line basis over the vesting period of the awards.

Activity of nonvested shares granted under the Company's LTIP plan is shown below:

		Weighted
		Average Grant
	Number of	Date Fair Value
	Shares	(per share)
Nonvested awards, December 31, 2013	115,984	$	47.27
Granted	28,344	$	73.32
Vested	(29,973)	$	44.32
Nonvested awards, June 30, 2014	114,355	$	54.50

The fair value of the nonvested stock is based on the trading price of the Company's common stock on the date of grant. The Company adjusts the grant date fair value for expected forfeitures based on historical experience for similar awards. As of June 30, 2014, unrecognized compensation expense related to these awards was $3,552 to be recognized over a weighted average remaining period of 2.17 years.

Activity of nonvested restricted stock units granted under the Company's LTIP plan is shown below:

		Weighted
		Average Grant
	Number of	Date Fair Value
	units	(per unit)
Nonvested awards, December 31, 2013	4,018	$	49.71
Granted	3,140	$	75.52
Nonvested awards, June 30, 2014	7,158	$	61.03

The fair value of the nonvested restricted stock units is based on the trading price of the Company's common stock on the date of grant. The Company adjusts the grant date fair value for expected forfeitures based on historical experience for similar awards. As of June 30, 2014, unrecognized compensation expense related to these awards was $281 to be recognized over a weighted average remaining period of 2.20 years.

In 2000, the Board adopted an Employee Stock Purchase Plan (“ESPP”) whereby employees may purchase Company stock through a payroll deduction plan. Purchases are made from the plan and credited to each participant's account at the end of each month, the “Investment Date.” The purchase price of the stock is 85% of the fair market value on the Investment Date. The plan is compensatory and the 15% discount is expensed on the Investment Date. All employees, including officers, are eligible to participate in this plan. A participant may withdraw all uninvested payment balances credited to a participant's account at any time. An employee whose stock ownership of the Company exceeds five percent of the outstanding common stock is not eligible to participate in this plan.

In March 2013, the Company adopted the 2013 Director Stock Ownership Plan (the “Plan”), subject to the approval by the Company's shareholders at the annual meeting, to encourage the Directors to increase their investment in the Company. The Plan was approved at the Company's May 2013 shareholders' meeting. The Plan authorizes the issuance of up to 75,000 shares of Quaker common stock in accordance with the terms of the Plan in payment of all or a portion of the annual cash retainer payable to each of the Company's non-employee directors in 2013 and subsequent years during the term of the Plan. Under the Plan, each director who, on May 1st of the applicable calendar year, owns less than 400% of the annual cash retainer for the applicable calendar year, divided by the average of the closing price of a share of Quaker Common Stock as reported by the composite tape of the New York Stock Exchange for the previous calendar year (the “Threshold Amount”), is required to receive 75% of the annual cash retainer in Quaker common stock and 25% of the retainer in cash, unless the director elects to receive a greater percentage of Quaker common stock (up to 100%) of the annual cash retainer for the applicable year. Each director who owns more than the Threshold Amount may elect to receive common stock in payment of a percentage (up to 100%) of the annual cash retainer. The annual retainer is $50 and the retainer payment date is June 1. The Plan was adopted in order to replace the 2003 Director Stock Ownership Plan, which expired in May 2013.