##### Table of Contents



UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-Q
 
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED:
 September 30, 2006
 - OR -
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934.
 Commission File Number: 000-51003
 
 CALAMOS ASSET MANAGEMENT, INC.
 (Exact Name of Registrant as Specified in its Charter)
 
 Delaware
    
    32-0122554(State or Other Jurisdiction of
    
    (I.R.S. EmployerIncorporation or Organization)
    
    Identification No.)2020 Calamos Court, Naperville, Illinois
    
    60563(Address of Principal Executive Offices)
    
    (Zip Code)
 (630) 245-7200
 
 þ o
  Large accelerated filer
o
     
     Accelerated filer
þ
     
     Non-accelerated filer
o
 o þ




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TABLE OF CONTENTS  PART I  FINANCIAL INFORMATIONItem 1. Financial StatementsItem 2. Managements Discussion and Analysis of Financial Condition and Results of OperationsItem 3. Quantitative and Qualitative Disclosures About Market RiskItem 4. Controls and ProceduresPART II  OTHER INFORMATIONItem 1. Legal ProceedingsItem 6. ExhibitsSIGNATURESCertification of CEO Pursuant to Section 302Certification of CFO Pursuant to Section 302Certification of CEO Pursuant to Section 906Certification of CFO Pursuant to Section 906    Table of Contents  
 PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 CALAMOS
ASSET MANAGEMENT, INC.
 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(in thousands, except share data)
 September 30,
    
    December 31,2006
    
    2005(unaudited)ASSETS:Current assetsCash and cash equivalents
    
    $
    294,172
    
    
    $
    210,469Receivables:Affiliates and affiliated funds
    
    
    25,731
    
    
    
    24,670Customers
    
    
    10,391
    
    
    
    9,806Investment securities
    
    
    133,375
    
    
    
    128,265Investment in partnerships
    
    
    83,667
    
    
    
    79,956Prepaid expenses
    
    
    1,768
    
    
    
    2,342Deferred tax asset, net
    
    
    7,545
    
    
    
    7,846Other
    
    
    66
    
    
    
    195Total current assets
    
    
    556,715
    
    
    
    463,549Non-current assetsDeferred tax asset, net
    
    
    94,950
    
    
    
    101,280Deferred sales commissions
    
    
    55,146
    
    
    
    58,390Property and equipment, net of accumulated depreciation ($11,479
at 9/30/06 and $6,357 at 12/31/05)
    
    
    43,304
    
    
    
    40,547Other non-current assets
    
    
    1,556
    
    
    
    1,711Total non-current assets
    
    
    194,956
    
    
    
    201,928Total assets
    
    
    751,671
    
    
    
    665,477LIABILITIES AND STOCKHOLDERS EQUITY:Current liabilitiesAccounts payable:Brokers
    
    
    19,867
    
    
    
    18,485Affiliates and affiliated funds
    
    
    429
    
    
    
    93Accrued compensation and benefits
    
    
    17,139
    
    
    
    19,131Accrued expenses and other current liabilities
    
    
    9,036
    
    
    
    11,025Total current liabilities
    
    
    46,471
    
    
    
    48,734Long-term liabilitiesLong-term debt
    
    
    150,000
    
    
    
    150,000Other long-term liabilities
    
    
    7,682
    
    
    
    6,726Total long-term liabilities
    
    
    157,682
    
    
    
    156,726Total liabilities
    
    
    204,153
    
    
    
    205,460Minority interest in investment in partnerships
    
    
    48,043
    
    
    
    44,453Minority interest in Calamos Holdings LLC
    
    
    292,756
    
    
    
    229,430Stockholders equity:Class A Common Stock, $0.01 par value. Authorized 600,000,000 shares;
issued and outstanding 23,161,898 shares at 9/30/06 and 23,000,000
shares at 12/31/05
    
    
    232
    
    
    
    230Class B Common Stock, $0.01 par value. Authorized 1,000 shares; issued
and outstanding 100 shares
    
    
    0
    
    
    
    0Additional paid-in capital
    
    
    157,414
    
    
    
    156,274Retained earnings
    
    
    45,512
    
    
    
    26,698Accumulated other comprehensive income
    
    
    3,561
    
    
    
    2,932Total stockholders equity
    
    
    206,719
    
    
    
    186,134Total liabilities, minority interest and stockholders equity
    
    $
    751,671
    
    
    $
    665,477
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##### Table of Contents



CALAMOS
ASSET MANAGEMENT, INC.
 CONSOLIDATED STATEMENTS OF OPERATIONS
Three and Nine Months Ended September 30, 2006 and 2005
(in thousands, except share data)
(unaudited)
 Three Months Ended
    
    Nine Months EndedSeptember 30,
    
    September 30,2006
    
    2005
    
    2006
    
    2005Revenues:Investment management fees
    
    $
    80,718
    
    
    $
    73,669
    
    
    $
    246,525
    
    
    $
    206,939Distribution and underwriting fees
    
    
    36,840
    
    
    
    33,335
    
    
    
    113,977
    
    
    
    94,724Other
    
    
    989
    
    
    
    682
    
    
    
    3,016
    
    
    
    2,416Total revenues
    
    
    118,547
    
    
    
    107,686
    
    
    
    363,518
    
    
    
    304,079Expenses:Employee compensation and benefits
    
    
    17,203
    
    
    
    15,365
    
    
    
    54,496
    
    
    
    45,146Distribution and underwriting expense
    
    
    24,509
    
    
    
    20,642
    
    
    
    75,338
    
    
    
    57,006Amortization of deferred sales commissions
    
    
    8,645
    
    
    
    7,894
    
    
    
    24,508
    
    
    
    23,798Marketing and sales promotion
    
    
    3,523
    
    
    
    3,760
    
    
    
    11,124
    
    
    
    10,296General and administrative
    
    
    8,029
    
    
    
    6,693
    
    
    
    22,842
    
    
    
    16,765Total expenses
    
    
    61,909
    
    
    
    54,354
    
    
    
    188,308
    
    
    
    153,011Operating income
    
    
    56,638
    
    
    
    53,332
    
    
    
    175,210
    
    
    
    151,068Other income (expense):Net interest income (expense)
    
    
    1,638
    
    
    
    (676
    )
    
    
    2,820
    
    
    
    (2,963
    )Investment
and other income (loss)
    
    
    (3,336
    )
    
    
    4,647
    
    
    
    668
    
    
    
    7,030Minority interest in partnership investments
    
    
    2,502
    
    
    
    (2,416
    )
    
    
    1,411
    
    
    
    (3,444
    )Total other income (expense), net
    
    
    804
    
    
    
    1,555
    
    
    
    4,899
    
    
    
    623Income before minority interest in Calamos
Holdings LLC and income taxes
    
    
    57,442
    
    
    
    54,887
    
    
    
    180,109
    
    
    
    151,691Minority interest in Calamos Holdings LLC
    
    
    44,032
    
    
    
    42,224
    
    
    
    138,141
    
    
    
    116,739Income before income taxes
    
    
    13,410
    
    
    
    12,663
    
    
    
    41,968
    
    
    
    34,952Income taxes
    
    
    5,369
    
    
    
    5,024
    
    
    
    16,821
    
    
    
    13,940Net income
    
    $
    8,041
    
    
    $
    7,639
    
    
    $
    25,147
    
    
    $
    21,012Earnings per shareBasic
    
    $
    0.35
    
    
    $
    0.33
    
    
    $
    1.09
    
    
    $
    0.91Diluted
    
    $
    0.34
    
    
    $
    0.33
    
    
    $
    1.07
    
    
    $
    0.91Weighted average shares outstandingBasic
    
    
    23,161,998
    
    
    
    23,000,100
    
    
    
    23,161,998
    
    
    
    23,000,100Diluted
    
    
    100,757,758
    
    
    
    100,667,805
    
    
    
    100,778,115
    
    
    
    100,606,766Cash dividends per share
    
    $
    0.09
    
    
    $
    0.07
    
    
    $
    0.27
    
    
    $
    0.21
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##### Table of Contents



CALAMOS
ASSET MANAGEMENT, INC.
 CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
Nine Months Ended September 30, 2006
(in thousands, except share data)
(unaudited)
 AccumulatedAdditional
    
    
    
    
    
    OtherCommon
    
    Paid-in
    
    Retained
    
    ComprehensiveStock
    
    Capital
    
    Earnings
    
    Income
    
    TotalBalance at December 31, 2005
    
    $
    230
    
    
    $
    156,274
    
    
    $
    26,698
    
    
    $
    2,932
    
    
    $
    186,134Net income
    
    
    
    
    
    
    
    
    
    
    25,147
    
    
    
    
    
    
    
    25,147Changes in unrealized gains on available-for-sale securities, net of minority interest and
income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    615
    
    
    
    615Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,762Issuance of common stock under stock
incentive plans (161,898 Class A
common shares)
    
    
    2
    
    
    
    113
    
    
    
    
    
    
    
    14
    
    
    
    129Compensation expense recognized under
stock incentive plans, net of minority
interest
    
    
    
    
    
    
    1,027
    
    
    
    
    
    
    
    
    
    
    
    1,027Dividend equivalent accrued under stock
incentive plans, net of minority interest
    
    
    
    
    
    
    
    
    
    
    (79
    )
    
    
    
    
    
    
    (79
    )Dividends declared
    
    
    
    
    
    
    
    
    
    
    (6,254
    )
    
    
    
    
    
    
    (6,254
    )Balance at September 30, 2006
    
    $
    232
    
    
    $
    157,414
    
    
    $
    45,512
    
    
    $
    3,561
    
    
    $
    206,719
  -4-




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CALAMOS ASSET MANAGEMENT, INC.
 CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended September 30, 2006 and 2005
(in thousands)
(unaudited)
 2006
    
    2005Cash and cash equivalents at beginning of year
    
    $
    210,469
    
    
    $
    149,768Cash flows from operating activities:Net income
    
    
    25,147
    
    
    
    21,012Adjustments to reconcile net income to net cash provided by
operating activities:Minority interest in partnership investments
    
    
    (1,411
    )
    
    
    3,444Minority interest in Calamos Holdings LLC
    
    
    138,141
    
    
    
    116,739Amortization of deferred sales commissions
    
    
    24,508
    
    
    
    23,798Other depreciation and amortization
    
    
    5,337
    
    
    
    3,204Unrealized depreciation (appreciation) on broker-dealer securities
    
    
    76
    
    
    
    (6,158
    )Unrealized depreciation on partnership investments
    
    
    2,069
    
    
    
    70Management fee received in partnership units
    
    
    (101
    )
    
    
    (115
    )Deferred taxes
    
    
    6,551
    
    
    
    7,242Stock-based compensation
    
    
    4,442
    
    
    
    3,210Employee taxes paid on vesting under stock incentive plans
    
    
    (2,255
    )
    
    
    Loss on disposal of property
    
    
    
    
    
    
    515Non-cash donation of equipment
    
    
    
    
    
    
    139(Increase) decrease in assets:Accounts receivable:Affiliates and affiliated mutual funds
    
    
    (1,061
    )
    
    
    (1,496
    )Customers
    
    
    (585
    )
    
    
    (2,390
    )Deferred sales commissions
    
    
    (21,264
    )
    
    
    (22,609
    )Other assets
    
    
    258
    
    
    
    806Increase (decrease) in liabilities:Accounts payable
    
    
    1,718
    
    
    
    3,607Accrued compensation and benefits
    
    
    (1,992
    )
    
    
    4,409Other liabilities and accrued expenses
    
    
    (731
    )
    
    
    4,224Net cash provided by operating activities
    
    
    178,847
    
    
    
    159,651Cash flows used in investing activities:Net additions to property and equipment
    
    
    (7,880
    )
    
    
    (38,472
    )Net purchases of securities and partnership investments
    
    
    (1,503
    )
    
    
    (27,859
    )Net cash used in investing activities
    
    
    (9,383
    )
    
    
    (66,331
    )Cash flows used in financing activities:Deferred tax benefit on vesting under stock incentive plans
    
    
    (289
    )
    
    
    Cash distributions paid to minority shareholders
    
    
    (79,218
    )
    
    
    (64,063
    )Cash dividends paid to common shareholders
    
    
    (6,254
    )
    
    
    (4,830
    )Net cash used in financing activities
    
    
    (85,761
    )
    
    
    (68,893
    )Net increase in cash
    
    
    83,703
    
    
    
    24,427Cash and cash equivalents at end of period
    
    $
    294,172
    
    
    $
    174,195
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CALAMOS ASSET MANAGEMENT, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
 (1) Organization and Description of Business
  (2) Basis of Presentation
    (3) Earnings Per Share
  Three Months Ended
    
    Nine Months Ended(in thousands, except per share data)
    
    September 30,
    
    September 30,2006
    
    2005
    
    2006
    
    2005Earnings per share  basicEarnings available to common shareholders
    
    $
    8,041
    
    
    $
    7,639
    
    
    $
    25,147
    
    
    $
    21,012Weighted average shares outstanding
    
    
    23,162
    
    
    
    23,000
    
    
    
    23,162
    
    
    
    23,000Earnings per share  basic
    
    $
    0.35
    
    
    $
    0.33
    
    
    $
    1.09
    
    
    $
    0.91
 -6-




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##### Table of Contents



CALAMOS
ASSET MANAGEMENT, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 Three Months Ended
    
    Nine Months Ended(in thousands, except per share data)
    
    September 30,
    
    September 30,2006
    
    2005
    
    2006
    
    2005Earnings per share  dilutedIncome before minority interest in
Calamos Holdings LLC and income taxes
    
    $
    57,442
    
    
    $
    54,887
    
    
    $
    180,109
    
    
    $
    151,691Less: Impact of income taxes
    
    
    23,000
    
    
    
    21,774
    
    
    
    72,188
    
    
    
    60,494Earnings available to common shareholders
    
    $
    34,442
    
    
    $
    33,113
    
    
    $
    107,921
    
    
    $
    91,197Weighted average shares outstanding
    
    
    23,162
    
    
    
    23,000
    
    
    
    23,162
    
    
    
    23,000Conversion of membership units for
common stock
    
    
    77,000
    
    
    
    77,000
    
    
    
    77,000
    
    
    
    77,000Dilutive impact of restricted stock units
    
    
    519
    
    
    
    605
    
    
    
    506
    
    
    
    565Dilutive impact of stock options
    
    
    77
    
    
    
    63
    
    
    
    110
    
    
    
    42Weighted average shares and potential
dilutive shares outstanding
    
    
    100,758
    
    
    
    100,668
    
    
    
    100,778
    
    
    
    100,607Earnings per share  diluted
    
    $
    0.34
    
    
    $
    0.33
    
    
    $
    1.07
    
    
    $
    0.91
  Share-Based Payment
 -7-




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##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 (4) Incentive Compensation Plan
    WeightedNumber of
    
    AverageShares
    
    Exercise PriceOutstanding at beginning of period
    
    
    1,009,967
    
    
    $
    21.35Granted
    
    
    402,349
    
    
    
    35.08Forfeited
    
    
    (76,708
    )
    
    
    24.55Exercised
    
    
    
    
    
    
    Outstanding at end of period
    
    
    1,335,608
    
    
    
    25.30
   2006
    
    2005Dividend yield
    
    
    1.02% - 1.42
    %
    
    
    0.96% - 0.97
    %Expected volatility
    
    
    33% - 35
    %
    
    
    33
    %Risk-free interest rate
    
    
    4.6% - 5.0
    %
    
    
    3.9% - 4.2
    %Expected life
    
    7.5 years
    
    7.5 years
 -8-




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##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  WeightedAverage FairNumber of
    
    Value of RSUsShares
    
    GrantedOutstanding at beginning of period
    
    
    1,414,862
    
    
    $
    18.79Granted
    
    
    134,117
    
    
    
    35.08Forfeited
    
    
    (26,770
    )
    
    
    23.68Exercised
    
    
    (233,599
    )
    
    
    18.00Outstanding at end of period
    
    
    1,288,610
    
    
    
    20.51
    (5) Recently Issued Accounting Pronouncements
 Accounting for Uncertainty in
Income Taxes  an interpretation of FASB Statement No. 109
 Fair Value Measurements
 (6) Subsequent Event
  -9-




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    (in millions)
    
    September 30,2006
    
    2005Mutual FundsOpen-end funds
    
    $
    26,947
    
    
    $
    24,480Closed-end funds
    
    
    6,240
    
    
    
    5,996Total mutual funds
    
    
    33,187
    
    
    
    30,476Separate AccountsInstitutional accounts
    
    
    4,320
    
    
    
    3,912Managed accounts
    
    
    6,451
    
    
    
    7,012Private client accounts
    
    
    758
    
    
    
    681Alternative investments
    
    
    93
    
    
    
    88Total separate accounts
    
    
    11,622
    
    
    
    11,693Total assets under management
    
    $
    44,809
    
    
    $
    42,169
   -10-




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##### Table of Contents



Operating Results
 Third Quarter and Nine Months Ended September 30, 2006 Compared to Third Quarter and Nine Months
Ended September 30, 2005
 Assets Under Management
  ($ in millions)
    
    Three Months Ended September 30,
    
    Nine Months Ended September 30,Change
    
    
    
    
    
    
    
    
    
    Change2006
    
    2005
    
    Amount
    
    Percent
    
    2006
    
    2005
    
    Amount
    
    PercentMutual FundsBeginning assets under management
    
    $
    33,837
    
    
    $
    28,333
    
    
    $
    5,504
    
    
    
    19
    %
    
    $
    31,898
    
    
    $
    26,951
    
    
    $
    4,947
    
    
    
    18
    %Net purchases (redemptions)
    
    
    (649
    )
    
    
    471
    
    
    
    (1,120
    )
    
    
    238
    
    
    
    1,366
    
    
    
    2,604
    
    
    
    (1,238
    )
    
    
    48Market appreciation (depreciation)
    
    
    (1
    )
    
    
    1,672
    
    
    
    (1,673
    )
    
    
    100
    
    
    
    (77
    )
    
    
    921
    
    
    
    (998
    )
    
    
    108Ending assets under management
    
    
    33,187
    
    
    
    30,476
    
    
    
    2,711
    
    
    
    9
    
    
    
    33,187
    
    
    
    30,476
    
    
    
    2,711
    
    
    
    9Average assets under management
    
    
    32,768
    
    
    
    29,572
    
    
    
    3,196
    
    
    
    11
    
    
    
    33,738
    
    
    
    28,035
    
    
    
    5,703
    
    
    
    20Separate AccountsBeginning assets under management
    
    
    11,975
    
    
    
    11,179
    
    
    
    796
    
    
    
    7
    
    
    
    11,907
    
    
    
    11,024
    
    
    
    883
    
    
    
    8Net purchases (redemptions)
    
    
    (382
    )
    
    
    (74
    )
    
    
    (308
    )
    
    
    416
    
    
    
    (421
    )
    
    
    356
    
    
    
    (777
    )
    
    
    218Market appreciation
    
    
    29
    
    
    
    588
    
    
    
    (559
    )
    
    
    95
    
    
    
    136
    
    
    
    313
    
    
    
    (177
    )
    
    
    57Ending assets under management
    
    
    11,622
    
    
    
    11,693
    
    
    
    (71
    )
    
    
    1
    
    
    
    11,622
    
    
    
    11,693
    
    
    
    (71
    )
    
    
    1Average assets under management
    
    
    11,649
    
    
    
    11,514
    
    
    
    135
    
    
    
    1
    
    
    
    12,101
    
    
    
    11,098
    
    
    
    1,003
    
    
    
    9Total Assets Under ManagementBeginning assets under management
    
    
    45,812
    
    
    
    39,512
    
    
    
    6,300
    
    
    
    16
    
    
    
    43,805
    
    
    
    37,975
    
    
    
    5,830
    
    
    
    15Net purchases (redemptions)
    
    
    (1,031
    )
    
    
    397
    
    
    
    (1,428
    )
    
    
    360
    
    
    
    945
    
    
    
    2,960
    
    
    
    (2,015
    )
    
    
    68Market appreciation
    
    
    28
    
    
    
    2,260
    
    
    
    (2,232
    )
    
    
    99
    
    
    
    59
    
    
    
    1,234
    
    
    
    (1,175
    )
    
    
    95Ending assets under management
    
    
    44,809
    
    
    
    42,169
    
    
    
    2,640
    
    
    
    6
    
    
    
    44,809
    
    
    
    42,169
    
    
    
    2,640
    
    
    
    6Average assets under management
    
    $
    44,417
    
    
    $
    41,086
    
    
    $
    3,331
    
    
    
    8
    %
    
    $
    45,839
    
    
    $
    39,133
    
    
    $
    6,706
    
    
    
    17
    %
   -11-




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##### Table of Contents



Revenues
  ($ in thousands)
    
    Three Months Ended September 30,
    
    Nine Months Ended September 30,Change
    
    
    
    
    
    
    
    
    
    Change2006
    
    2005
    
    Amount
    
    Percent
    
    2006
    
    2005
    
    Amount
    
    PercentInvestment management fees
    
    $
    80,718
    
    
    $
    73,669
    
    
    $
    7,049
    
    
    
    10
    %
    
    $
    246,525
    
    
    $
    206,939
    
    
    $
    39,586
    
    
    
    19
    %Distribution and
underwriting fees
    
    
    36,840
    
    
    
    33,335
    
    
    
    3,505
    
    
    
    11
    
    
    
    113,977
    
    
    
    94,724
    
    
    
    19,253
    
    
    
    20Other
    
    
    989
    
    
    
    682
    
    
    
    307
    
    
    
    45
    
    
    
    3,016
    
    
    
    2,416
    
    
    
    600
    
    
    
    25Total revenues
    
    $
    118,547
    
    
    $
    107,686
    
    
    $
    10,861
    
    
    
    10
    %
    
    $
    363,518
    
    
    $
    304,079
    
    
    $
    59,439
    
    
    
    20
    %
   Operating Expenses
  ($ in thousands)
    
    Three Months Ended September 30,
    
    Nine Months Ended September 30,Change
    
    
    
    
    
    
    
    
    
    Change2006
    
    2005
    
    Amount
    
    Percent
    
    2006
    
    2005
    
    Amount
    
    PercentEmployee compensation and benefits
    
    $
    17,203
    
    
    $
    15,365
    
    
    $
    1,838
    
    
    
    12
    %
    
    $
    54,496
    
    
    $
    45,146
    
    
    $
    9,350
    
    
    
    21
    %Distribution and underwriting
expense
    
    
    24,509
    
    
    
    20,642
    
    
    
    3,867
    
    
    
    19
    
    
    
    75,338
    
    
    
    57,006
    
    
    
    18,332
    
    
    
    32Amortization of deferred sales
commissions
    
    
    8,645
    
    
    
    7,894
    
    
    
    751
    
    
    
    10
    
    
    
    24,508
    
    
    
    23,798
    
    
    
    710
    
    
    
    3Marketing and sales promotion
    
    
    3,523
    
    
    
    3,760
    
    
    
    (237
    )
    
    
    6
    
    
    
    11,124
    
    
    
    10,296
    
    
    
    828
    
    
    
    8General and administrative
    
    
    8,029
    
    
    
    6,693
    
    
    
    1,336
    
    
    
    20
    
    
    
    22,842
    
    
    
    16,765
    
    
    
    6,077
    
    
    
    36Total operating expenses
    
    $
    61,909
    
    
    $
    54,354
    
    
    $
    7,555
    
    
    
    14
    %
    
    $
    188,308
    
    
    $
    153,011
    
    
    $
    35,297
    
    
    
    23
    %
   -12-




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##### Table of Contents



Other Income (Expense), Net
  ($ in thousands)
    
    Three Months Ended September 30,
    
    Nine Months Ended September 30,2006
    
    2005
    
    Change
    
    2006
    
    2005
    
    ChangeNet interest income (expense)
    
    $
    1,638
    
    
    $
    (676
    )
    
    $
    2,314
    
    
    $
    2,820
    
    
    $
    (2,963
    )
    
    $
    5,783Investment
and other income (loss)
    
    
    (3,336
    )
    
    
    4,647
    
    
    
    (7,983
    )
    
    
    668
    
    
    
    7,030
    
    
    
    (6,362
    )Minority interest in partnership
investments
    
    
    2,502
    
    
    
    (2,416
    )
    
    
    4,918
    
    
    
    1,411
    
    
    
    (3,444
    )
    
    
    4,855Total other income (expense), net
    
    $
    804
    
    
    $
    1,555
    
    
    $
    (751
    )
    
    $
    4,899
    
    
    $
    623
    
    
    $
    4,276
   Income Taxes
  -13-




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##### Table of Contents



Liquidity and Capital Resources
   September 30,
    
    December 31,(in thousands)
    
    2006
    
    2005Statements of financial condition data:Cash and cash equivalents
    
    $
    294,172
    
    
    $
    210,469Receivables
    
    
    36,122
    
    
    
    34,476Investment securities
    
    
    133,375
    
    
    
    128,265Investment in partnerships
    
    
    83,667
    
    
    
    79,956Deferred tax
assets, net
    
    
    102,495
    
    
    
    109,126Deferred sales commissions
    
    
    55,146
    
    
    
    58,390Long-term debt
    
    
    150,000
    
    
    
    150,000
  (in thousands)
    
    2006
    
    2005Cash flow data:Net cash provided by operating activities
    
    $
    178,847
    
    
    $
    159,651Net cash used in investing activities
    
    
    (9,383
    )
    
    
    (66,331
    )Net cash used in financing activities
    
    
    (85,761
    )
    
    
    (68,893
    )
      Recently Issued Accounting Pronouncements
 Accounting for Uncertainty in
Income Taxes  an interpretation of FASB Statement No. 109
 -14-




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##### Table of Contents



Fair Value Measurements
 Critical Accounting Policies
  Forward-Looking Information
   Risk Factors
  -15-




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##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
  
 Item 4. Controls and Procedures
   
 PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 6. Exhibits
 3(i)
    
    Amended and Restated Certificate of Incorporation of the Registrant
(incorporated by reference to Exhibit 3.1 to the Registrants Current Report
on Form 8-K filed with the Securities and Exchange Commission on November 2,
2004).3(ii)
    
    Amended and Restated By-Laws of the Registrant (incorporated by reference to
Exhibit 3.2 to the Registrants Current Report on Form 8-K filed with the
Securities and Exchange Commission on April 26, 2005).4.1
    
    Stockholders Agreement among John P. Calamos, Sr., Nick P. Calamos and John
P. Calamos, Jr., certain trusts controlled by them, Calamos Family Partners,
Inc. and the Registrant (incorporated by reference to Exhibit 4.1 to the
Registrants Quarterly Report on Form 10-Q filed with the Securities and
Exchange Commission on December 3, 2004).4.2
    
    Registration Rights Agreement between Calamos Family Partners, Inc., John P.
Calamos, Sr. and the Registrant (incorporated by reference to Exhibit 4.2 to
the Registrants Quarterly Report on Form 10-Q filed with the Securities and
Exchange Commission on December 3, 2004).31.1
    
    Certification pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act.31.2
    
    Certification pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act.32.1
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
 -16-




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##### Table of Contents



SIGNATURES
  CALAMOS
ASSET MANAGEMENT, INC.(Registrant)Date: November 3, 2006
    
    By:
    
    /s/ Patrick H. DudasikPatrick H. DudasikExecutive Vice President, Chief Financial Officerand Treasurer
 -17-