##### 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 1934FOR THE QUARTERLY PERIOD ENDED:
 September 30, 2007
 - 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
  o þ o
 o þ




---



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 2. Unregistered Sales of Equity Securities and Use of ProceedsItem 6. ExhibitsSIGNATURESTransition AgreementTransition AgreementCertificationCertificationSection 906 CertificationSection 906 Certification    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 31,2007
    
    
    2006(unaudited)ASSETS:Current assetsCash and cash equivalents
    
    $
    479,906
    
    
    $
    328,841Receivables:Affiliates and affiliated funds
    
    
    25,919
    
    
    
    26,569Customers
    
    
    10,997
    
    
    
    10,218Investment securities
    
    
    370,615
    
    
    
    143,112Partnership securities
    
    
    144,563
    
    
    
    86,409Prepaid expenses
    
    
    2,605
    
    
    
    2,383Deferred tax assets, net
    
    
    7,103
    
    
    
    7,375Other assets
    
    
    687
    
    
    
    67Total current assets
    
    
    1,042,395
    
    
    
    604,974Non-current assetsDeferred tax assets, net
    
    
    84,160
    
    
    
    91,865Deferred sales commissions
    
    
    36,469
    
    
    
    49,891Property and equipment, net of accumulated depreciation ($19,553
at 9/30/07 and $13,233 at 12/31/06)
    
    
    45,395
    
    
    
    43,615Other non-current assets
    
    
    3,035
    
    
    
    1,443Total non-current assets
    
    
    169,059
    
    
    
    186,814Total assets
    
    
    1,211,454
    
    
    
    791,788LIABILITIES AND STOCKHOLDERS EQUITY:Current liabilitiesAccounts payable:Brokers
    
    
    18,766
    
    
    
    20,969Affiliates and affiliated funds
    
    
    398
    
    
    
    264Accrued compensation and benefits
    
    
    18,288
    
    
    
    22,722Accrued expenses and other current liabilities
    
    
    22,285
    
    
    
    6,890Total current liabilities
    
    
    59,737
    
    
    
    50,845Long-term liabilitiesLong-term debt
    
    
    525,000
    
    
    
    150,000Other long-term liabilities
    
    
    8,597
    
    
    
    8,003Total long-term liabilities
    
    
    533,597
    
    
    
    158,003Total liabilities
    
    
    593,334
    
    
    
    208,848Minority interest in partnership investments
    
    
    53,614
    
    
    
    48,850Minority interest in Calamos Holdings LLC
    
    
    350,641
    
    
    
    319,513Stockholders equity:Class A Common Stock, $0.01 par value. Authorized 600,000,000 shares;
23,324,082 shares issued and 21,324,082 shares outstanding at
9/30/07; 23,161,898 shares issued and outstanding at 12/31/06
    
    
    233
    
    
    
    232Class B Common Stock, $0.01 par value. Authorized 1,000 shares; issued
and outstanding 100 shares
    
    
    0
    
    
    
    0Additional paid-in capital
    
    
    190,233
    
    
    
    157,724Retained earnings
    
    
    63,184
    
    
    
    52,261Accumulated other comprehensive income
    
    
    8,270
    
    
    
    4,360Treasury stock, at cost; 2,000,000 shares
    
    
    (48,055
    )
    
    
    Total stockholders equity
    
    
    213,865
    
    
    
    214,577Total liabilities, minority interest and stockholders equity
    
    $
    1,211,454
    
    
    $
    791,788
  -2-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three and Nine Months Ended September 30, 2007 and 2006
(in thousands, except share data)
(unaudited)
 Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006Revenues:Investment management fees
    
    $
    82,209
    
    
    $
    80,718
    
    
    $
    238,997
    
    
    $
    246,525Distribution and underwriting fees
    
    
    35,252
    
    
    
    36,840
    
    
    
    106,993
    
    
    
    113,977Other
    
    
    1,023
    
    
    
    989
    
    
    
    2,961
    
    
    
    3,016Total revenues
    
    
    118,484
    
    
    
    118,547
    
    
    
    348,951
    
    
    
    363,518Expenses:Employee compensation and benefits
    
    
    22,912
    
    
    
    17,203
    
    
    
    66,190
    
    
    
    54,496Distribution and underwriting expense
    
    
    26,246
    
    
    
    24,509
    
    
    
    76,469
    
    
    
    75,338Amortization of deferred sales commissions
    
    
    6,064
    
    
    
    8,645
    
    
    
    21,220
    
    
    
    24,508Marketing and sales promotion
    
    
    3,861
    
    
    
    3,602
    
    
    
    37,074
    
    
    
    11,312General and administrative
    
    
    9,962
    
    
    
    7,950
    
    
    
    27,472
    
    
    
    22,654Total operating expenses
    
    
    69,045
    
    
    
    61,909
    
    
    
    228,425
    
    
    
    188,308Operating income
    
    
    49,439
    
    
    
    56,638
    
    
    
    120,526
    
    
    
    175,210Other income (expense):Net interest income (expense)
    
    
    (1,356
    )
    
    
    1,638
    
    
    
    2,133
    
    
    
    2,820Investment and other income (loss)
    
    
    6,729
    
    
    
    (3,336
    )
    
    
    14,499
    
    
    
    668Minority interest in partnership investments
    
    
    (2,066
    )
    
    
    2,502
    
    
    
    (4,335
    )
    
    
    1,411Total other income (expense), net
    
    
    3,307
    
    
    
    804
    
    
    
    12,297
    
    
    
    4,899Income before minority interest in Calamos
Holdings LLC and income taxes
    
    
    52,746
    
    
    
    57,442
    
    
    
    132,823
    
    
    
    180,109Minority interest in Calamos Holdings LLC
    
    
    40,863
    
    
    
    44,032
    
    
    
    101,938
    
    
    
    138,141Income before income taxes
    
    
    11,883
    
    
    
    13,410
    
    
    
    30,885
    
    
    
    41,968Income taxes
    
    
    4,756
    
    
    
    5,369
    
    
    
    12,419
    
    
    
    16,821Net income
    
    $
    7,127
    
    
    $
    8,041
    
    
    $
    18,466
    
    
    $
    25,147Earnings per shareBasic
    
    $
    0.33
    
    
    $
    0.35
    
    
    $
    0.81
    
    
    $
    1.09Diluted
    
    $
    0.32
    
    
    $
    0.34
    
    
    $
    0.79
    
    
    $
    1.07Weighted average shares outstandingBasic
    
    
    21,851,112
    
    
    
    23,161,998
    
    
    
    22,668,669
    
    
    
    23,161,998Diluted
    
    
    99,320,380
    
    
    
    100,757,758
    
    
    
    100,093,296
    
    
    
    100,778,115Cash dividends per share
    
    $
    0.11
    
    
    $
    0.09
    
    
    $
    0.33
    
    
    $
    0.27
  -3-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
Nine Months Ended September 30, 2007
(in thousands)
(unaudited)
 AccumulatedAdditional
    
    
    
    
    
    
    OtherCommon
    
    
    Paid-in
    
    
    Retained
    
    
    Comprehensive
    
    
    TreasuryStock
    
    
    Capital
    
    
    Earnings
    
    
    Income
    
    
    Stock
    
    
    TotalBalance at December 31, 2006
    
    $
    232
    
    
    $
    157,724
    
    
    $
    52,261
    
    
    $
    4,360
    
    
    $
    
    
    
    $
    214,577Net income
    
    
    
    
    
    
    
    
    
    
    18,466
    
    
    
    
    
    
    
    
    
    
    
    18,466Changes in unrealized gains on
available-for-sale
securities, net of
minority interest and income
taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,505
    
    
    
    
    
    
    
    4,505Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,971Issuance of common stock
(162,184 Class A common
shares)
    
    
    1
    
    
    
    (1
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Impact of sale of Calamos
Holdings LLC membership units
(2,000,000 units)
    
    
    
    
    
    
    37,633
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    37,633Repurchase of common stock
(2,000,000 Class A common
shares)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (48,055
    )
    
    
    (48,055
    )Cumulative impact of changes
in ownership of Calamos
Holdings LLC
    
    
    
    
    
    
    (6,305
    )
    
    
    19
    
    
    
    (595
    )
    
    
    
    
    
    
    (6,881
    )Compensation expense
recognized under stock
incentive plans, net of
minority interest
    
    
    
    
    
    
    1,182
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,182Dividend equivalent accrued
under stock incentive plans,
net of minority interest
    
    
    
    
    
    
    
    
    
    
    (100
    )
    
    
    
    
    
    
    
    
    
    
    (100
    )Dividends declared
    
    
    
    
    
    
    
    
    
    
    (7,462
    )
    
    
    
    
    
    
    
    
    
    
    (7,462
    )Balance at September 30, 2007
    
    $
    233
    
    
    $
    190,233
    
    
    $
    63,184
    
    
    $
    8,270
    
    
    $
    (48,055
    )
    
    $
    213,865
  -4-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Nine Months Ended September 30, 2007 and 2006
(in thousands)
(unaudited)
 2007
    
    
    2006Cash and cash equivalents at beginning of year
    
    $
    328,841
    
    
    $
    210,469Cash flows from operating activities:Net income
    
    
    18,466
    
    
    
    25,147Adjustments to reconcile net income to net cash provided by
operating activities:Minority interest in partnership investments
    
    
    4,335
    
    
    
    (1,411
    )Minority interest in Calamos Holdings LLC
    
    
    101,938
    
    
    
    138,141Amortization of deferred sales commissions
    
    
    21,220
    
    
    
    24,508Other depreciation and amortization
    
    
    6,708
    
    
    
    5,337Unrealized (appreciation) depreciation on CFS securities
and partnership securities
    
    
    (10,347
    )
    
    
    2,145Deferred taxes
    
    
    5,125
    
    
    
    6,551Stock-based compensation
    
    
    5,209
    
    
    
    4,442Employee taxes paid on vesting under stock incentive plans
    
    
    (1,853
    )
    
    
    (2,255
    )(Increase) decrease in assets:Accounts receivable:Affiliates and affiliated mutual funds
    
    
    593
    
    
    
    (1,168
    )Customers
    
    
    (779
    )
    
    
    (585
    )Deferred sales commissions
    
    
    (7,798
    )
    
    
    (21,264
    )Other assets
    
    
    (1,057
    )
    
    
    256Increase (decrease) in liabilities:Accounts payable
    
    
    (2,069
    )
    
    
    1,718Accrued compensation and benefits and deferred compensation
    
    
    (4,434
    )
    
    
    (1,992
    )Other liabilities and accrued expenses
    
    
    16,153
    
    
    
    (586
    )Net cash provided by operating activities
    
    
    151,410
    
    
    
    178,984Cash flows used in investing activities:Net additions to property and equipment
    
    
    (8,214
    )
    
    
    (7,880
    )Net purchases of investment securities
    
    
    (192,714
    )
    
    
    (824
    )Net changes in partnership securities
    
    
    (48,057
    )
    
    
    (1,247
    )Net cash used in investing activities
    
    
    (248,985
    )
    
    
    (9,951
    )Cash flows provided by (used in) financing activities:Net proceeds from issuance of debt
    
    
    372,963
    
    
    
    Deferred tax benefit on vesting under stock incentive plans
    
    
    (209
    )
    
    
    (289
    )Repurchase of common stock
    
    
    (48,055
    )
    
    
    Cash distributions paid to minority shareholders
    
    
    (68,597
    )
    
    
    (79,218
    )Cash dividends paid to common shareholders
    
    
    (7,462
    )
    
    
    (6,254
    )Net cash provided by (used in) financing activities
    
    
    248,640
    
    
    
    (85,761
    )Net increase in cash
    
    
    151,065
    
    
    
    83,272Cash and cash equivalents at end of period
    
    $
    479,906
    
    
    $
    293,741
  -5-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
 (1) Organization and Description of Business
  (2) Basis of Presentation
      -6-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 (3) Investment Securities
  September 30, 2007(in thousands)
    
    Available-for-Sale
    
    
    CFS Securities
    
    
    Total SecuritiesMutual FundsEquity
    
    $
    209,004
    
    
    $
    3,432
    
    
    $
    212,436Balanced
    
    
    89,950
    
    
    
    794
    
    
    
    90,744Fixed income
    
    
    62,046
    
    
    
    
    
    
    
    62,046High yield
    
    
    3,742
    
    
    
    
    
    
    
    3,742Other
    
    
    243
    
    
    
    231
    
    
    
    474Total mutual funds
    
    
    364,985
    
    
    
    4,457
    
    
    
    369,442Other investment securities
    
    
    973
    
    
    
    200
    
    
    
    1,173$
    365,958
    
    
    $
    4,657
    
    
    $
    370,615
 December 31, 2006(in thousands)
    
    Available-for-Sale
    
    
    CFS Securities
    
    
    Total SecuritiesMutual FundsEquity
    
    $
    101,166
    
    
    $
    2,816
    
    
    $
    103,982Balanced
    
    
    33,724
    
    
    
    718
    
    
    
    34,442High yield
    
    
    3,457
    
    
    
    
    
    
    
    3,457Other
    
    
    28
    
    
    
    216
    
    
    
    244Total mutual funds
    
    
    138,375
    
    
    
    3,750
    
    
    
    142,125Other investment securities
    
    
    824
    
    
    
    163
    
    
    
    987$
    139,199
    
    
    $
    3,913
    
    
    $
    143,112
  -7-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,(in thousands)
    
    2007
    
    
    2006
    
    
    2007
    
    
    2006Available-for-sale securities:Proceeds from sale
    
    $
    
    
    
    $
    18
    
    
    $
    
    
    
    $
    18Realized gains (losses)
    
    
    
    
    
    
    10
    
    
    
    
    
    
    
    10Unrealized gains
    
    
    17,971
    
    
    
    2,245
    
    
    
    34,053
    
    
    
    4,371CFS securities:Unrealized gains (losses)
    
    
    378
    
    
    
    (21
    )
    
    
    736
    
    
    
    (61
    )
  September 30,
    
    
    December 31,(in thousands)
    
    2007
    
    
    2006Total cumulative unrealized gains on available-for-sale securities
with net gains:Mutual FundsEquity
    
    $
    49,731
    
    
    $
    22,529Balanced
    
    
    11,503
    
    
    
    6,024Fixed income
    
    
    1,344
    
    
    
    High yield
    
    
    21
    
    
    
    91Other
    
    
    8
    
    
    
    Total mutual funds
    
    
    62,607
    
    
    
    28,644Other investment securities
    
    
    274
    
    
    
    205Total gains
    
    
    62,881
    
    
    
    28,849Total cumulative unrealized losses on available-for-sale securities
with net losses:Mutual FundsBalanced
    
    $
    (8
    )
    
    $
    High yield
    
    
    (32
    )
    
    
    (63
    )Other
    
    
    
    
    
    
    (1
    )Total mutual funds
    
    
    (40
    )
    
    
    (64
    )Other investment securities
    
    
    (15
    )
    
    
    (12
    )Total losses
    
    
    (55
    )
    
    
    (76
    )Total cumulative net unrealized gains (losses) on available-for-sale securities
    
    $
    62,826
    
    
    $
    28,773
  -8-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 (4) Partnership Securities
  September 30,
    
    
    December 31,(in thousands)
    
    2007
    
    
    2006Calamos Equity Opportunities Fund LP:Securities owned
    
    $
    119,548
    
    
    $
    110,956Securities sold but not yet purchased
    
    
    (25,550
    )
    
    
    (24,104
    )Accrued expenses and other current liabilities
    
    
    (6,541
    )
    
    
    (4,190
    )Other current assets
    
    
    2,909
    
    
    
    71Calamos Equity Opportunities Fund LP securities, net
    
    
    90,366
    
    
    
    82,733Calamos Market Neutral Opportunities Fund LP:Securities owned
    
    
    84,188
    
    
    
    Securities sold but not yet purchased
    
    
    (23,884
    )
    
    
    Accrued expenses and other current liabilities
    
    
    (6,943
    )
    
    
    Other current assets
    
    
    836
    
    
    
    Calamos Market Neutral Opportunities Fund LP securities, net
    
    
    54,197
    
    
    
    Investment in Calamos Multi-Strategy, L.P.
    
    
    
    
    
    
    3,676Partnership securities
    
    $
    144,563
    
    
    $
    86,409
  (5) Earnings Per Share
  Three Months Ended
    
    
    Nine Months EndedSeptember 30,
    
    
    September 30,(in thousands, except per share data)
    
    2007
    
    
    2006
    
    
    2007
    
    
    2006Earnings per share  basicEarnings available to common shareholders
    
    $
    7,127
    
    
    $
    8,041
    
    
    $
    18,466
    
    
    $
    25,147Weighted average shares outstanding
    
    
    21,851
    
    
    
    23,162
    
    
    
    22,669
    
    
    
    23,162Earnings per share  basic
    
    $
    0.33
    
    
    $
    0.35
    
    
    $
    0.81
    
    
    $
    1.09Earnings per share  dilutedIncome before minority interest in Calamos
Holdings LLC and income taxes
    
    $
    52,746
    
    
    $
    57,442
    
    
    $
    132,823
    
    
    $
    180,109Less: Impact of income taxes
    
    
    21,109
    
    
    
    23,000
    
    
    
    53,408
    
    
    
    72,188Earnings available to common shareholders
    
    $
    31,637
    
    
    $
    34,442
    
    
    $
    79,415
    
    
    $
    107,921Weighted average shares outstanding
    
    
    21,851
    
    
    
    23,162
    
    
    
    22,669
    
    
    
    23,162Conversion of membership units for common
stock
    
    
    77,000
    
    
    
    77,000
    
    
    
    77,000
    
    
    
    77,000Dilutive impact of restricted stock units
    
    
    397
    
    
    
    519
    
    
    
    357
    
    
    
    506Dilutive impact of stock options
    
    
    72
    
    
    
    77
    
    
    
    67
    
    
    
    110Weighted average diluted shares outstanding
    
    
    99,320
    
    
    
    100,758
    
    
    
    100,093
    
    
    
    100,778Earnings per share  diluted
    
    $
    0.32
    
    
    $
    0.34
    
    
    $
    0.79
    
    
    $
    1.07
 -9-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  Share-Based Payment
 (6) Incentive Compensation Plan
     -10-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 (7) Income Taxes
 Accounting for Uncertainty in Income Taxes  an interpretation of FASB Statement No. 109.
   (8) Common Stock Repurchase
   (9) Minority Interest in Calamos Holdings LLC
   (in thousands)Minority interest at December 31, 2006
    
    $
    319,513Income allocated to minority interests
    
    
    101,938Changes in unrealized gains on available-for-sale securities
    
    
    26,486Impact of sale of Calamos Holdings LLC membership units
    
    
    (37,633
    )Cumulative impact of changes in ownership of Calamos
Holdings LLC units
    
    
    5,237Compensation expense recognized under stock incentive plans
    
    
    4,027Dividend equivalent accrued under stock incentive plans
    
    
    (330
    )Tax distributions
    
    
    (43,187
    )Equity
distributions
    
    
    (25,410
    )Minority interest at September 30, 2007
    
    $
    350,641
 -11-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
  September 30,
    
    
    December 31,(in thousands)
    
    2007
    
    
    2006Cash and cash equivalents
    
    $
    25,260
    
    
    $
    18,796Current deferred tax assets, net
    
    
    7,103
    
    
    
    7,375Other current assets
    
    
    236
    
    
    
    432Total current assets
    
    
    32,599
    
    
    
    26,603Non-current deferred tax assets, net
    
    
    84,159
    
    
    
    91,865Investment in subsidiaries
    
    
    409,070
    
    
    
    435,208Total non-current assets
    
    
    493,229
    
    
    
    527,073Total assets
    
    
    525,828
    
    
    
    553,676Total stockholders equity
    
    
    525,828
    
    
    
    553,676Total liabilities and stockholders equity
    
    $
    525,828
    
    
    $
    553,676
 (10) Long-term Debt
    -12-




---



##### Table of Contents



CALAMOS ASSET MANAGEMENT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 (11) Recently Issued Accounting Pronouncements
 Fair Value Measurements
 The Fair Value Option for Financial Assets and
Financial Liabilities  Including an amendment of FASB Statement No. 115
 -13-




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of
Operations
   September 30,(in millions)
    
    2007
    
    
    2006Mutual FundsOpen-end funds
    
    $
    28,000
    
    
    $
    27,338Closed-end funds
    
    
    7,677
    
    
    
    6,240Total mutual funds
    
    
    35,677
    
    
    
    33,578Separate AccountsInstitutional accounts
    
    
    4,896
    
    
    
    5,303Managed accounts
    
    
    6,028
    
    
    
    5,835Alternative investments
    
    
    145
    
    
    
    93Total separate accounts
    
    
    11,069
    
    
    
    11,231Total assets under management
    
    $
    46,746
    
    
    $
    44,809
   -14-




---



##### Table of Contents



Operating Results
 Third Quarter and Nine Months Ended September 30, 2007 Compared to Third Quarter and Nine Months
Ended September 30, 2006
 Assets Under Management
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,Change
    
    
    
    
    
    
    
    
    
    
    Change($ in millions)
    
    2007
    
    
    2006
    
    
    Amount
    
    
    Percent
    
    
    2007
    
    
    2006
    
    
    Amount
    
    
    PercentMutual FundsBeginning assets under management
    
    $
    33,286
    
    
    $
    34,217
    
    
    $
    (931
    )
    
    
    3
    %
    
    $
    33,704
    
    
    $
    32,244
    
    
    $
    1,460
    
    
    
    5
    %Net purchases (redemptions)
    
    
    511
    
    
    
    (649
    )
    
    
    1,160
    
    
    
    *
    
    
    
    (2,206
    )
    
    
    1,399
    
    
    
    (3,605
    )
    
    
    *Market appreciation (depreciation)
    
    
    1,880
    
    
    
    10
    
    
    
    1,870
    
    
    
    *
    
    
    
    4,179
    
    
    
    (65
    )
    
    
    4,244
    
    
    
    *Ending assets under management
    
    
    35,677
    
    
    
    33,578
    
    
    
    2,099
    
    
    
    6
    
    
    
    35,677
    
    
    
    33,578
    
    
    
    2,099
    
    
    
    6Average assets under management
    
    
    33,572
    
    
    
    33,150
    
    
    
    422
    
    
    
    1
    
    
    
    33,402
    
    
    
    34,114
    
    
    
    (712
    )
    
    
    2Separate AccountsBeginning assets under management
    
    
    10,525
    
    
    
    11,595
    
    
    
    (1,070
    )
    
    
    9
    
    
    
    11,021
    
    
    
    11,561
    
    
    
    (540
    )
    
    
    5Net redemptions
    
    
    (137
    )
    
    
    (382
    )
    
    
    245
    
    
    
    *
    
    
    
    (1,356
    )
    
    
    (454
    )
    
    
    (902
    )
    
    
    *Market appreciation
    
    
    681
    
    
    
    18
    
    
    
    663
    
    
    
    *
    
    
    
    1,404
    
    
    
    124
    
    
    
    1,280
    
    
    
    *Ending assets under management
    
    
    11,069
    
    
    
    11,231
    
    
    
    (162
    )
    
    
    1
    
    
    
    11,069
    
    
    
    11,231
    
    
    
    (162
    )
    
    
    1Average assets under management
    
    
    10,639
    
    
    
    11,267
    
    
    
    (628
    )
    
    
    6
    
    
    
    10,690
    
    
    
    11,725
    
    
    
    (1,035
    )
    
    
    9Total Assets Under ManagementBeginning assets under management
    
    
    43,811
    
    
    
    45,812
    
    
    
    (2,001
    )
    
    
    4
    
    
    
    44,725
    
    
    
    43,805
    
    
    
    920
    
    
    
    2Net purchases (redemptions)
    
    
    374
    
    
    
    (1,031
    )
    
    
    1,405
    
    
    
    *
    
    
    
    (3,562
    )
    
    
    945
    
    
    
    (4,507
    )
    
    
    *Market appreciation
    
    
    2,561
    
    
    
    28
    
    
    
    2,533
    
    
    
    *
    
    
    
    5,583
    
    
    
    59
    
    
    
    5,524
    
    
    
    *Ending assets under management
    
    
    46,746
    
    
    
    44,809
    
    
    
    1,937
    
    
    
    4
    
    
    
    46,746
    
    
    
    44,809
    
    
    
    1,937
    
    
    
    4Average assets under management
    
    $
    44,211
    
    
    $
    44,417
    
    
    $
    (206
    )
    
    
    0
    %
    
    $
    44,092
    
    
    $
    45,839
    
    
    $
    (1,747
    )
    
    
    4
    %
 
 *
    
    Not meaningful.     -15-




---



##### Table of Contents



Results of Operations
 Overview
    Nine Months EndedSeptember 30,($ in thousands)
    
    2007
    
    2006Operating expenses
    
    $
    228,425
    
    
    $
    188,308Termination of closed-end fund compensation agreements
    
    
    19,500
    
    
    
    Closed-end fund structuring fees
    
    
    6,904
    
    
    
    Operating expenses, as adjusted
    
    $
    202,021
    
    
    $
    188,308Operating income
    
    $
    120,526
    
    
    $
    175,210Termination of closed-end fund compensation agreements
    
    
    19,500
    
    
    
    Closed-end fund structuring fees
    
    
    6,904
    
    
    
    Operating income, as adjusted
    
    $
    146,930
    
    
    $
    175,210Net income
    
    $
    18,466
    
    
    $
    25,147Termination of closed-end fund compensation agreements
    
    
    2,634
    
    
    
    Closed-end fund structuring fees
    
    
    933
    
    
    
    Net income,
as adjusted

    
    $
    22,033
    
    
    $
    25,147
 -16-




---



##### Table of Contents



Operating Income
   Revenues
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,Change
    
    
    
    
    
    
    
    
    
    
    Change($ in thousands)
    
    2007
    
    
    2006
    
    
    Amount
    
    
    Percent
    
    
    2007
    
    
    2006
    
    
    Amount
    
    
    PercentInvestment management fees
    
    $
    82,209
    
    
    $
    80,718
    
    
    $
    1,491
    
    
    
    2
    %
    
    $
    238,997
    
    
    $
    246,525
    
    
    $
    (7,528
    )
    
    
    3
    %Distribution and
underwriting fees
    
    
    35,252
    
    
    
    36,840
    
    
    
    (1,588
    )
    
    
    4
    
    
    
    106,993
    
    
    
    113,977
    
    
    
    (6,984
    )
    
    
    6Other
    
    
    1,023
    
    
    
    989
    
    
    
    34
    
    
    
    3
    
    
    
    2,961
    
    
    
    3,016
    
    
    
    (55
    )
    
    
    2Total revenues
    
    $
    118,484
    
    
    $
    118,547
    
    
    $
    (63
    )
    
    
    0
    %
    
    $
    348,951
    
    
    $
    363,518
    
    
    $
    (14,567
    )
    
    
    4
    %
     -17-




---



##### Table of Contents



Operating Expenses
   Three Months Ended September 30,
    
    
    Nine Months Ended September 30,Change
    
    
    
    
    
    
    
    
    
    
    Change($ in thousands)
    
    2007
    
    
    2006
    
    
    Amount
    
    
    Percent
    
    
    2007
    
    
    2006
    
    
    Amount
    
    
    PercentEmployee compensation and benefits
    
    $
    22,912
    
    
    $
    17,203
    
    
    $
    5,709
    
    
    
    33
    %
    
    $
    66,190
    
    
    $
    54,496
    
    
    $
    11,694
    
    
    
    21
    %Distribution and underwriting
expense
    
    
    26,246
    
    
    
    24,509
    
    
    
    1,737
    
    
    
    7
    
    
    
    76,469
    
    
    
    75,338
    
    
    
    1,131
    
    
    
    2Amortization of deferred sales
commissions
    
    
    6,064
    
    
    
    8,645
    
    
    
    (2,581
    )
    
    
    30
    
    
    
    21,220
    
    
    
    24,508
    
    
    
    (3,288
    )
    
    
    13Marketing and sales promotion
    
    
    3,861
    
    
    
    3,602
    
    
    
    259
    
    
    
    7
    
    
    
    37,074
    
    
    
    11,312
    
    
    
    25,762
    
    
    
    228General and administrative
    
    
    9,962
    
    
    
    7,950
    
    
    
    2,012
    
    
    
    25
    
    
    
    27,472
    
    
    
    22,654
    
    
    
    4,818
    
    
    
    21Total operating expenses
    
    $
    69,045
    
    
    $
    61,909
    
    
    $
    7,136
    
    
    
    12
    %
    
    $
    228,425
    
    
    $
    188,308
    
    
    $
    40,117
    
    
    
    21
    %
      -18-




---



##### Table of Contents



Other Income (Expense), Net
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,($ in thousands)
    
    2007
    
    
    2006
    
    
    Change
    
    
    2007
    
    
    2006
    
    
    ChangeNet interest income (expense)
    
    $
    (1,356
    )
    
    $
    1,638
    
    
    $
    (2,994
    )
    
    $
    2,133
    
    
    $
    2,820
    
    
    $
    (687
    )Investment and other income (loss)
    
    
    6,729
    
    
    
    (3,336
    )
    
    
    10,065
    
    
    
    14,499
    
    
    
    668
    
    
    
    13,831Minority interest in partnership
investments
    
    
    (2,066
    )
    
    
    2,502
    
    
    
    (4,568
    )
    
    
    (4,335
    )
    
    
    1,411
    
    
    
    (5,746
    )Total other income, net
    
    $
    3,307
    
    
    $
    804
    
    
    $
    2,503
    
    
    $
    12,297
    
    
    $
    4,899
    
    
    $
    7,398
  Three Months Ended September 30,
    
    
    Nine Months Ended September 30,($ in thousands)
    
    2007
    
    
    2006
    
    
    Change
    
    
    2007
    
    
    2006
    
    
    ChangeInterest income
    
    $
    5,975
    
    
    $
    3,674
    
    
    $
    2,301
    
    
    $
    13,537
    
    
    $
    8,929
    
    
    $
    4,608Interest expense
    
    
    (7,331
    )
    
    
    (2,036
    )
    
    
    (5,295
    )
    
    
    (11,404
    )
    
    
    (6,109
    )
    
    
    (5,295
    )Net interest income (expense)
    
    $
    (1,356
    )
    
    $
    1,638
    
    
    $
    (2,994
    )
    
    $
    2,133
    
    
    $
    2,820
    
    
    $
    (687
    )
     -19-




---



##### Table of Contents



Income Taxes
  Net Income
   Liquidity and Capital Resources
   September 30,
    
    December 31,(in thousands)
    
    2007
    
    2006Statements of financial condition data:Cash and cash equivalents
    
    $
    479,906
    
    
    $
    328,841Receivables
    
    
    36,916
    
    
    
    36,787Investment securities
    
    
    370,615
    
    
    
    143,112Partnership securities
    
    
    144,563
    
    
    
    86,409Deferred tax assets, net
    
    
    91,263
    
    
    
    99,240Deferred sales commissions
    
    
    36,469
    
    
    
    49,891Long-term debt
    
    
    525,000
    
    
    
    150,000
  September 30,(in thousands)
    
    2007
    
    2006Cash flow data:Net cash provided by operating activities
    
    $
    151,410
    
    
    $
    178,984Net cash used in investing activities
    
    
    (248,985
    )
    
    
    (9,951
    )Net cash provided by (used in) financing activities
    
    
    248,640
    
    
    
    (85,761
    )
    -20-




---



##### Table of Contents



Recently Issued Accounting Pronouncements
 Fair Value Measurements
 The Fair Value Option for Financial Assets and
Financial Liabilities  Including an amendment of FASB Statement No. 115
 -21-




---



##### Table of Contents



Critical Accounting Policies
  Forward-Looking Information
   Risk Factors
  -22-




---



##### Table of Contents



Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
 Item 4. Controls and Procedures
   -23-




---



##### Table of Contents



PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  (c)
    
    
    (d)Total Number of
    
    
    Maximum NumberShares Purchased as
    
    
    of Shares that May(a)
    
    
    (b)
    
    
    Part of Publicly
    
    
    be PurchasedTotal Number of
    
    
    Average Price Paid
    
    
    Announced Plans or
    
    
    Under the Plans orShares Purchased
    
    
    Per Share
    
    
    Programs
    
    
    ProgramsJuly 1  July 31, 2007
    
    
    
    
    
    $
    
    
    
    
    
    
    
    
    1,212,200August 1  August 31, 2007
    
    
    1,212,200
    
    
    
    24.10
    
    
    
    1,212,200
    
    
    
    September 1  September 30, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    1,212,200
    
    
    $
    24.10
    
    
    
    1,212,200
    
    
    
    
  -24-




---



##### Table of Contents



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).3(iii)
    
    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 January 23, 2007).3(iv)
    
    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 March 8, 2007).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).4.3
    
    Note Purchase Agreement, dated as of July 13, 2007, by and among Calamos
Holdings LLC and various institutional investors (incorporated by reference to
Exhibit 4.1 to the Registrants Current Report on Form 8-K filed with the
Securities and Exchange Commission on July 18, 2007).10.1
    
    Transition Agreement, dated as of August 7, 2007, by and among Calamos Asset
Management, Inc., Calamos Advisors LLC, Calamos Holdings LLC and Patrick H.
Dudasik.10.2
    
    Transition Agreement, dated as of September 5, 2007, by and among Calamos
Asset Management, Inc., Calamos Advisors LLC, Calamos Holdings LLC and James
S. Hamman, Jr.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.
 -25-




---



##### Table of Contents



SIGNATURES
  CALAMOS ASSET MANAGEMENT, INC.
             (Registrant)Date:  November 7, 2007
    By:
    /s/ Patrick H. DudasikPatrick H. DudasikExecutive Vice President, Chief Operating Officer,
Chief Financial Officer and Treasurer -26-