18. Earnings per Share

Effective January 1, 2009, the Company adopted ASC subtopic 260-10, Determining Whether Instruments Granted in Share-Based Payments Transactions Are Participating Securities. ASC 260-10 provides that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents, whether paid or unpaid, are participating securities and are to be included in the computation of earnings per share under the two-class method. The Company’s unvested restricted shares contain rights to receive nonforfeitable dividends and are participating securities, requiring the two-class method of computing earnings per share. There were no participating securities issued in 2009.

The following, is a summary of the elements used in calculating basic and diluted earnings per share for the years ended December 31, 2011, 2010 and 2009:


(Amounts in Thousands, except for earnings per share)	2011		2010		2009
Basics earnings per share:
Net income attributable to AmTrust Financial Services, Inc. shareholders	$	170,434	$	142,465	$	103,223
Less: Net income allocated to participating securities and redeemable non-controlling interest		111		81		—
Net income allocated to AmTrust Financial Services, Inc. common shareholders	$	170,323	$	142,384	$	103,223
Weighted average shares outstanding – basic		59,875		59,491		59,433
Less: Weighted average participating shares outstanding		39		38		—
Weighted average common shares outstanding – basic		59,836		59,453		59,433
Net income per AmTrust Financial Services, Inc. common shares – basic	$	2.85	$	2.39	$	1.74
Diluted earnings per share:
Net income attributable to AmTrust Financial Services, Inc. shareholders	$	170,434	$	142,465	$	103,223
Less: Net income allocated to participating securities and redeemable non-controlling interest		111		81		—
Net income allocated to AmTrust Financial Services, Inc. common shareholders	$	170,323	$	142,384	$	103,223
Weighted average common shares outstanding – basic		59,836		59,453		59,433
Plus: Dilutive effect of stock options, other		1,746		893		521
Weighted average common shares outstanding – dilutive		61,582		60,346		59,954
Net income per AmTrust Financial Services, Inc. common shares – diluted	$	2.77	$	2.36	$	1.72

As of December 31, 2011, there were less than 100,000 anti-dilutive securities excluded from diluted earnings per share.