Basic earnings per common share is computed by dividing net earnings attributable to Mylan Inc. common shareholders by the weighted average number of shares outstanding during the period. Diluted earnings per common share is computed by dividing net earnings attributable to Mylan Inc. common shareholders by the weighted average number of shares outstanding during the period increased by the number of additional shares that would have been outstanding related to potentially dilutive securities or instruments, if the impact is dilutive.

On November 15, 2010, pursuant to its terms, the Company's 6.50% mandatorily convertible preferred stock converted into 125,234,172 shares of Mylan's common stock, and Mylan is no longer obligated to pay dividends. With respect to the Company's convertible preferred stock, for the three and nine months ended September 30, 2010, the Company considered the effect on diluted earnings per share of the preferred stock conversion feature using the if-converted method. The preferred stock was convertible into between 125,234,172 shares and 152,785,775 shares of the Company's common stock. For the three months ended September 30, 2010, the if-converted method was dilutive; therefore, the preferred stock conversion was included in the computation of diluted earnings per share. For the nine months ended September 30, 2010, the if-converted method was anti-dilutive; therefore, the preferred stock conversion was excluded from the computation of diluted earnings per share.

On September 15, 2008, concurrent with the sale of $575.0 million aggregate principal amount of Cash Convertible Notes due 2015 (the "Cash Convertible Notes"), Mylan entered into a convertible note hedge and warrant transaction with certain counterparties. Pursuant to the warrant transactions, the Company sold to the counterparties warrants to purchase in the aggregate up to approximately 43.2 million shares of Mylan common stock, subject to anti-dilution adjustments substantially similar to the anti-dilution adjustments for the Cash Convertible Notes, which under most circumstances represents the maximum number of shares that underlie the conversion reference rate for the Cash Convertible Notes. The sold warrants had an exercise price of $20.00 and will be net share settled, meaning that Mylan will issue a number of shares per warrant corresponding to the difference between its share price at each warrant expiration date and the exercise price. The warrants meet the definition of derivatives under the guidance in FASB Accounting Standards Codification ("ASC") 815 Derivatives and Hedging ("ASC 815"); however, because these instruments have been determined to be indexed to the Company's own stock and meet the criteria for equity classification under ASC 815-40 Contracts in Entity's Own Equity, the warrants have been recorded in shareholders' equity in the Condensed Consolidated Balance Sheets.

In the third quarter of 2011, the Company entered into amendments with the counterparties to exchange the original warrants with an exercise price of $20.00 (the "Old Warrants") with new warrants with an exercise price of $30.00 (the "New Warrants"). Approximately 41.0 million of the Old Warrants were exchanged in the transaction. All other terms and settlement provisions of the Old Warrants remain unchanged in the New Warrants. As part of the amendments, the Company paid the holders of the Old Warrants approximately $3.66 per warrant or approximately $150 million in total. Under the provisions of ASC 815-40, the Company recorded the payment as a reduction of shareholders' equity in the Condensed Consolidated Balance Sheets as the Old Warrants were classified in permanent equity. The New Warrants meet the definition of derivatives under the guidance in ASC 815; however, because these instruments have been determined to be indexed to the Company's own stock and meet the criteria for equity classification under ASC 815-40, the New Warrants have also been recorded in shareholders' equity in the Condensed Consolidated Balance Sheets.

For the three and nine months ended September 30, 2011, the average market value of the Company's shares exceeded the exercise price of the Old Warrants, and as a result, the Company has included 1.2 million and 4.3 million shares, respectively, in the calculation of the diluted earnings per share, which includes the weighted average impact of the amendments entered into during the third quarter of 2011. The average market value of the Company's shares did not exceed the exercise price of the Old Warrants during the three and nine months ended September 30, 2010. The average market value of the Company's shares did not exceed the exercise price of the New Warrants during the three and nine months ended September 30, 2011.

On May 3, 2011, the Company announced that its Board of Directors had approved the repurchase of up to $350 million of the Company's common stock and other equity securities, either in the open market or through privately-negotiated transactions. During the second quarter of 2011, the repurchase program was completed with approximately 14.8 million shares of common stock being repurchased for approximately $350 million.

Basic and diluted earnings per common share attributable to Mylan Inc. are calculated as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
	(In thousands, except per share amounts)
Basic earnings attributable to Mylan Inc. common shareholders (numerator):
Net earnings attributable to Mylan Inc. before preferred dividends	$	156,698	$	143,183	$	407,319	$	325,268
Less: Preferred dividends		—		34,759		—		104,276

Net earnings attributable to Mylan Inc. common shareholders	$	156,698	$	108,424	$	407,319	$	220,992

Shares (denominator):
Weighted average common shares outstanding		426,412		309,446		432,265		308,470

Basic earnings per common share attributable to Mylan Inc. common shareholders	$	0.37	$	0.35	$	0.94	$	0.72


	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
	(In thousands, except per share amounts)
Diluted earnings attributable to Mylan Inc. common shareholders (numerator):
Net earnings attributable to Mylan Inc. common shareholders	$	156,698	$	108,424	$	407,319	$	220,992
Add: Preferred dividends		—		34,759		—		—

Earnings attributable to Mylan Inc. common shareholders and assumed conversions	$	156,698	$	143,183	$	407,319	$	220,992

Shares (denominator):
Weighted average common shares outstanding		426,412		309,446		432,265		308,470
Stock-based awards and warrants		5,175		3,241		9,552		4,544
Preferred stock conversion		—		125,234		—		—

Total dilutive shares outstanding		431,587		437,921		441,817		313,014

Diluted earnings per common share attributable to Mylan Inc. common shareholders	$	0.36	$	0.33	$	0.92	$	0.71

Additional stock options or restricted stock awards were outstanding during the periods ended September 30, 2011 and 2010 but were not included in the computation of diluted earnings per share for each respective period, because the effect would be anti-dilutive. Such anti-dilutive stock options or restricted stock awards represented 7.5 million and 4.9 million shares for the three and nine months ended September 30, 2011, and they represented 8.6 million and 6.8 million shares for the three and nine months ended September 30, 2010.