[LETTERHEAD OF PAUL, HASTINGS, JANOFSKY & WALKER LLP]
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rachaelschwartz@paulhastings.com
January 13, 2010 43490.00001
Ms. Laura E. Hatch
United States Securities and Exchange Commission
Division of Investment Management
100 F Street, N.E.
Washington, DC 20549
Re: The GAMCO Westwood Funds (the "Trust")
Post-Effective Amendment No. 36 to the Registration Statement
on Form N-1A (033-06790)
Dear Ms. Hatch:
This letter responds to your comments communicated by telephone on
January 4, 2010, with respect to the Post-Effective Amendment No. 36 to the
Registration Statement on Form N-1A (the `Registration Statement") of the
Company that was filed with the Securities and Exchange Commission (the "SEC")
on November 25, 2009 (accession number 0000950123-09-065970), with respect to
the GAMCO Westwood Mighty Mites Fund, the GAMCO Westwood SmallCap Equity Fund,
the GAMCO Westwood Income Fund, the GAMCO Westwood Equity Fund, the GAMCO
Westwood Balanced Fund and the GAMCO Westwood Intermediate Bond Fund (each, a
"Fund" and together, the "Funds"), the six series of the Trust.
In addition, in connection with this filing, the Trust hereby states
the following:
1. The Trust acknowledges that in connection with the comments
made by the Staff of the SEC, the Staff has not passed on the
accuracy or adequacy of the disclosure made herein, and the
Trust and its management are solely responsible for the
content of such disclosure;
2. The Trust acknowledges that the Staff's comments, and changes
in disclosure in response to the Staff's comments, do not
foreclose the SEC or other regulatory body from the
opportunity to seek enforcement or take other action with
respect to the disclosure made herein; and
3. The Trust represents that neither it nor its management will
assert the Staff's comments or changes in disclosure in
response to the Staff's comments as a defense in any action or
proceeding by the SEC or any person.
January 13, 2010
Page 2
The Trust's responses to your comments are reflected below. For
comments that applied to both the Class AAA Shares prospectus and the Class ABCI
Prospectus, we have only addressed the comment once. We have restated the
substance of your comments for your ease of reference.
Comment#1 - Investment Objective (GAMCO Westwood Income Fund): You have
requested that we move the second sentence to the "Principal Investment
Strategies" section.
Response#1: We have made this change.
Comment#2 - Fees and Expenses of the Fund: You have requested that we add a
space between the "Exchange Fee" and "Annual Fund Operating Expenses" in the Fee
Table for each Fund.
Response#2: We have added this space.
Comment#3 - Fees and Expenses of the Fund (GAMCO Westwood SmallCap Equity Fund,
the GAMCO Westwood Income Fund and the GAMCO Westwood Intermediate Bond Fund):
You have requested that we delete the references to the Custodian Fee Credits in
the Fee Table and in the footnote to the Fee Table.
Response#3: We have deleted these references.
Comment#4 - Fees and Expenses of the Fund (GAMCO Westwood SmallCap Equity Fund,
the GAMCO Westwood Income Fund and the GAMCO Westwood Intermediate Bond Fund):
You have noted that the Fund may only show the fee waiver and expense
reimbursement in the Fee Table if there is a contractual expense limitation for
at least one year that may not be terminated unilaterally by the Adviser.
Response#4: We have clarified the disclosure in the footnote to the Fee
Table for each of the above-referenced Funds to explain that the
contractual expense limitation is in effect for a year and may not be
terminated by the Fund or the Adviser during that time.
The GAMCO Westwood SmallCap Equity Fund Class AAA Shares Prospectus now
reads as follows:
"The Adviser has contractually agreed to waive its investment
advisory fees and/or reimburse expenses of the SmallCap Equity Fund to
the extent necessary to maintain the Total Annual Fund Operating
Expenses After Fee Waiver and Expense Reimbursement (excluding
brokerage, acquired fund fees and
January 13, 2010
Page 3
expenses, interest, taxes and extraordinary expenses) at no more than
1.50%. The fee waiver and expense reimbursement arrangement will
continue until at least january 31, 2011, and may not be terminated by
the fund or the Adviser before such time. Thereafter, this arrangement
may only be terminated or amended to increase the expense cap as of
january 31 of each calendar year, provided that in the case of a
termination by the Adviser, the Adviser will provide the board with
written notice of its intention to terminate the arrangement prior to
the expiration of its then current term."
Comment#5 - Expense Example: You have noted that certain of the numbers in the
Expense Examples are incorrect and should be recalculated.
Response#5: We will recalculate and restate these numbers as necessary.
Comment#6 - Principal Investment Strategies: You have noted that certain of the
Funds have included foreign securities risk as a principal risk, but do not
specifically mention whether they invest in foreign securities in the "Principal
Investment Strategies" section. You have requested that we add disclosure with
respect to any investment in foreign securities in the "Principal Investment
Strategies" section of each Prospectus for those Funds that include foreign
securities risk disclosure.
Response#6: We have added such disclosure.
Comment#7 - Principal Investment Strategies: You have requested that we delete
the disclosure regarding temporary defensive investments from the principal
investment strategies if they are not principal investment strategies. In
addition, you have requested that we disclose whether these temporary defensive
investments are short-term and liquid investments.
Response#7: We have deleted such disclosure from the "Principal
Investment Strategies" in the summary section. We have kept the discussion of
the temporary defensive investments in "Additional Information about the Funds'
Investment Objectives, Investment Strategies and Related Risks" and have added
disclosure that these investments are short-term and liquid investments.
Comment#8 - Principal Investment Strategies (GAMCO Westwood SmallCap Equity
Fund): You have requested that after the second sentence we add a discussion of
how often the Adviser may change its characterization of a small capitalization
company.
Response#8: We have revised the second sentence as follows:
"The Adviser characterizes small capitalization companies as
those companies with a market capitalization (defined as shares outstanding
times current market price) between $100 million and $2.5 billion at the time of
the Fund's initial
January 13, 2010
Page 4
investment. The Adviser may change this characterization at any time in the
future based upon the market capitalizations of the securities included in the
Russell 2000(R) Index."
Comment#9 - Performance: You have requested that we delete the third sentence in
the paragraph before the bar chart.
Response#9: We have deleted this sentence.
Comment#10 - Performance (GAMCO Westwood Income Fund): You have requested that
we delete the second and third sentences in the text before the bar chart with
respect to the historic performance of the Fund (when the Fund had a different
investment objective and strategies).
Response#10: We respectfully disagree with Comment #10 and propose to
leave the disclosure unchanged. The performance information shown in the
prospectuses for this Fund prior to 2006 reflects results achieved prior to
changes effected in 2005 to this Fund's investment objective and strategies.
Before such changes in 2005, the Fund was named the "Westwood Realty Fund" and
invested primarily in companies that engaged in real estate. After a successful
proxy solicitation in 2005, this Fund was renamed "Westwood Income Fund"
(eventually the "GAMCO Westwood Income Fund") and the investment objective and
strategies were changed to allow this Fund to investment primarily in income
producing equity and fixed income securities. Thus, the performance information
prior to 2006 was achieved pursuant to a different investment objective and
strategies and does not correspond to the performance information shown after
2006, which reflects the Fund's current investment objective and strategies. We
believe that without the current explanation of these historic events, the
performance information as shown would be materially misleading to Fund
investors and could subject the Fund to "prospectus liability" under the
Securities Act of 1933.
Comment#11 - Performance: You have requested that we delete the second sentence
of the text after the performance table regarding "Return After Taxes on
Distribution and Sale of Fund Shares" if it is not applicable for the Funds.
Response#11: If this disclosure is not applicable for a particular
Fund, we will remove it as appropriate.
Comment#12 - Performance (Class ABCI Prospectus): You have requested that we
present footnote 1 to the performance table in paragraph form (and not as a
footnote). You have also requested that we conform the third, fourth and fifth
sentences of said footnote to reflect the actual language set forth in Item 4,
instruction 3(b) of Form N-1A. In addition, you have asked that we disclose the
inception dates for Class A, Class B, Class C and Class I Shares in the
performance table as opposed to the text below the performance table.
January 13, 2010
Page 5
Response#12: We have made these changes. The text below the performance
table for the GAMCO Westwood Mighty Mites Fund now reads:
"The returns shown for Class A, Class B, Class C, and Class I
Shares prior to their actual inception dates are those of the Class AAA Shares
of the Mighty Mites Fund which are not offered in this Prospectus (the "Class
AAA Shares"). All Classes of the Mighty Mites Fund would have substantially
similar annual returns because the shares are invested in the same portfolio of
securities and the annual returns would differ only to the extent that the
Classes do not have the same expenses."
Comment#13 - Purchase and Sale of Fund Shares: You have noted that we may not
split the purchase and sale disclosure and only provide the minimum initial
investment information for each Fund in its summary section and then provide
common information at the end of all of the Funds' summary sections. You have
requested that we provide the purchase and sale information for each Fund in its
summary section. You have also requested that we condense the information
relating to how to purchase and sell shares of the Funds, in accordance with the
requirements of Item 6 of Form N-1A.
Response#13: We have made these changes.
Comment#14- Purchase and Sale of Fund Shares: You have requested that we delete
the last sentence in this section referring shareholders to additional
information on purchasing and redeeming shares in the statutory prospectus.
Response#14: We have deleted this sentence.
Comment#15 - Financial Highlights: You have noted that we may not include
Custodian Fee Credits in the headings entitled "Operating Expenses Before
Waivers/Reimbursements/Reductions." You have noted that we may include a
footnote to explain any Custodian Fee Credits, if applicable.
Response#15: We have removed all references to Custodian Fee Credits in
the headings of the Financial Highlights section for each Fund and have added
explanatory footnotes as necessary.
Comment#16 - Investment Restrictions (Statement of Additional Information): You
have noted that the last sentence of Investment Restriction #16 should be
deleted.
Response#16: We have deleted this sentence.
January 13, 2010
Page 6
Should you have any questions regarding the foregoing, please do not hesitate to
contact me at the number listed above. Thank you.
Very truly yours,
/s/ Rachael L. Schwartz
Rachael L. Schwartz
for PAUL, HASTINGS, JANOFSKY & WALKER LLP
cc: Bruce N. Alpert Arlene Lonergan
Teton Advisors, Inc. PNC Global Investment Servicing
Peter D. Goldstein Christopher J. Tafone
Teton Advisors, Inc. Paul, Hastings, Janofsky & Walker LLP
Agnes Mullady Helen Robichaud
Teton Advisors, Inc. PNC Global Investment Servicing