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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Amendment No. 17
for Steel Partners II, L.P., Warren G. Lichtenstein,
and Original Filing for Steel Partners Services, Ltd.)
Under the Securities Exchange Act of 1934
GATEWAY INDUSTRIES, INC.
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(Name of Issuer)
Common Stock, par value $.001 per share
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(Title of Class of Securities)
367595105
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(CUSIP Number)
Warren G. Lichtenstein
Steel Partners II, L.P.
750 Lexington Avenue - 27th Floor
New York, New York 10022
212/446-5217
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
August 29, 1996
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this
Schedule 13D, and is filing this schedule because of Rule
13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the
statement [X].
Page 1 of 11 pages
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|CUSIP NO. 367595105 | | Page 2 of 11 pages |
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1 NAME OF REPORTING PERSONS
S.S OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Steel Partners II, L.P.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
WC
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e)
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
Delaware
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NUMBER OF | 7 | SOLE VOTING POWER
SHARES | | 892,608
BENEFICIALLY |--------------------------------------------------------------
OWNED BY | 8 | SHARED VOTING POWER
EACH | | None.
REPORTING |--------------------------------------------------------------
PERSON WITH | 9 | SOLE DISPOSITIVE POWER
| | 892,608
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| 10 | SHARED DISPOSITIVE POWER
| | None.
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
892,608
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
24.8%
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14 TYPE OF REPORTING PERSON
PN
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|CUSIP NO. 367595105 | | Page 3 of 11 pages |
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1 NAME OF REPORTING PERSONS
S.S OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Steel Partners Services, Ltd
.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e)
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
New York
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NUMBER OF | 7 | SOLE VOTING POWER
SHARES | | 827,716
BENEFICIALLY |--------------------------------------------------------------
OWNED BY | 8 | SHARED VOTING POWER
EACH | | None.
REPORTING |--------------------------------------------------------------
PERSON WITH | 9 | SOLE DISPOSITIVE POWER
| | 827,716
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| 10 | SHARED DISPOSITIVE POWER
| | None.
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
827,716
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
23.0%
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14 TYPE OF REPORTING PERSON
CO
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|CUSIP NO. 367595105 | | Page 4 of 11 pages |
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1 NAME OF REPORTING PERSONS
S.S OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Warren G. Lichtenstein
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [X]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
PF, WC, OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e)
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6 CITIZENSHIP OR PLACE OR ORGANIZATION
U.S.A.
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NUMBER OF | 7 | SOLE VOTING POWER
SHARES | | 1,767,276(1)
BENEFICIALLY |--------------------------------------------------------------
OWNED BY | 8 | SHARED VOTING POWER
EACH | | None.
REPORTING |--------------------------------------------------------------
PERSON WITH | 9 | SOLE DISPOSITIVE POWER
| | 1,767,276(1)
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| 10 | SHARED DISPOSITIVE POWER
| | None.
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,767,276(1)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
49.0%
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14 TYPE OF REPORTING PERSON
IN
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(1) Includes 892,608 shares owned by Steel Partners II, L.P., and 827,716 shares
managed by Steel Partners Services, Ltd., entities controlled by Mr.
Lichtenstein and 46,952 shares owned directly by Mr. Lichtenstein (excluding
options to purchase 102,000 shares, not exercisable within 60 days).
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|CUSIP NO. 367595105 | | Page 5 of 11 pages |
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STATEMENT FOR SCHEDULE 13D
Item 1. Security and Issuer.
The class of equity securities to which this Statement relates is the
common stock, par value $.001 per share, of Gateway Industries, Inc., formerly,
Gateway Communications, Inc., a Delaware corporation (the "Issuer"), whose
principal executive office is located at 1275 Fourth Street, Santa Rosa,
California 95404.
Item 2. Identity and Background.
This statement is filed by a group consisting of Steel Partners II,
L.P. ("Steel Partners II"), Steel Partners Services, Ltd, a New York corporation
("Services") and Warren G. Lichtenstein ("Lichtenstein"). As previously
reported, certain shares of the Issuer's common stock reported by Lichtenstein
relate to the ownership of such shares by Steel Partners II and Services.
For information regarding the identity and background of Steel Partners
II and Lichtenstein, reference is made to the Schedule 13D filed on or about
April 25, 1994, which is incorporated herein by reference. Information regarding
Services is set forth below. Each of the foregoing are referred to as a
"Reporting Person" and collectively as the "Reporting Persons".
The sole executive officer, director and stockholder of Services is
Warren Lichtenstein who is Chairman of the Board, Chief Executive Officer and
Secretary. The principal business of Services is providing management and
advisory services. Its business address is 750 Lexington Avenue, New York, New
York 10022, 27th Floor.
Services acquired the 827,716 shares reported herein for the account of
Quota Fund N.V., a Netherlands Antilles investment corporation ("Quota"). Quota
has its principal office at Kaya Flamboyan 9, Willemstad, Curacao, Netherlands
Antilles. Quota granted investment discretion to Soros Fund Management ("SFM")
pursuant to an investment advisory contract. SFM's contract with Quota provides
that SFM is responsible for designing and implementing Quota's overall
investment strategy, for conducting direct portfolio management strategies to
the extent that SFM determines that it is appropriate to utilize its
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|CUSIP NO. 367595105 | | Page 6 of 11 pages |
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own portfolio management capabilities; for selecting, evaluating and monitoring
other investment advisors who manage separate portfolios on behalf of Quota; and
for allocating and reallocating Quota's assets among the outside managers
itself. In connection therewith, Quota granted investment discretion to Services
pursuant to an investment advisory contract between Quota and Services (the
"Services Contract"). The Shares beneficially owned by Services were acquired
at the direction of Services, and neither SFM nor Quota currently exercises
voting or investment discretion over the Shares.
SFM is a sole proprietorship of which George Soros ("Mr. Soros"), a
United States citizen, is the sole proprietor. SFM has its principal office at
888 Seventh Avenue, 33rd Floor, New York, New York 10106. Its sole business is
to serve, pursuant to contract, as the principal investment manager to several
foreign investment companies, including Quota.
No Reporting Person has, during the last five years, been party to a
civil proceeding or a judicial or administrative body of competent jurisdiction
and as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any violation
with respect to such laws.
Pursuant to regulations promulgated under Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "Act"), and notwithstanding
that neither SFM nor Quota currently exercises voting or dispositive power
over the Shares, Mr. Soros (as the sole proprietor and the person ultimately in
control of SFM) may be deemed a beneficial owner of securities, including the
Shares, held for the account of Quota as a result of the contractual authority
of SFM, upon termination of the Services Contract, to acquire voting and
dispositive power with regard to the Shares. Quota, SFM and Mr. Soros have
advised the Reporting Persons that they are not part of any group for purposes
of Section 13(d)(3) of the Act.
Item 3. Source and Amount of Funds or Other Consideration.
The aggregate purchase price of the Shares acquired by Steel Partners
II as reported in this Amendment is $1,262,250. The shares of common stock owned
by Steel Partners II were acquired with partnership funds.
The aggregate purchase price of the Shares acquired by Lichtenstein as
reported in this Amendment is $67,081.50. Such shares were acquired with
personal funds.
The aggregate purchase price of the shares of common stock acquired on
behalf of Quota as reported in this Amendment is $1,750,500. Such shares were
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|CUSIP NO. 367595105 | | Page 7 of 11 pages |
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acquired with funds it manages for Quota. Pursuant to the Services Agreement
with Quota, Services has been appointed to manage, on a discretionary basis,
certain of Quota's assets, which are maintained in a brokerage account in
Quota's name. The Services Agreement may be terminated by either party at any
time. Therefore, pursuant to Rule 13d-3(d)(1)(c), Quota may be deemed the
beneficial owner of the shares held for its account which are managed by
Services.
Item 4. Purpose of Transaction.
This amendment is being filed to report the acquisition by the
Reporting Persons of an additional 1,368,814 shares of common stock which were
acquired to increase their equity position in the Issuer. Mr. Lichtenstein is
chairman of the board of directors of the Issuer.
None of the Reporting Persons have any present plan or proposal with
respect to the Issuer that relate to or would result in any of the transactions
described in subparagraphs (a) through (j) of Item 4 of Schedule 13D. Each
intends to review his or its investment in the Issuer on a continuing basis and,
depending on various factors, including the Issuer's business affairs and
financial position, the price levels of the common stock, conditions in the
securities markets and general economic and industry conditions, may in the
future take such actions with respect to its investment in the Issuer as it
deems appropriate in light of the circumstances existing from time to time
including purchasing additional shares of common stock.
Item 5. Interest in Securities of the Issuer.
(a) The aggregate percentage of shares of common stock reported owned
by each person named herein is based upon 3,603,469 shares outstanding.
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|CUSIP NO. 367595105 | | Page 8 of 11 pages |
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As of the close of business on August 29, 1996:
(i) Steel Partners II owns 892,608 shares of common stock, constituting
approximately 24.8% of the shares outstanding and Services beneficially owns
827,716 shares, constituting 23.0%. Mr. Lichtenstein may be deemed to
beneficially own the shares owned by Steel Partners II and managed by Services,
by virtue of his authority to vote and dispose of such shares.
(ii) Lichtenstein owns individually 46,952 shares of the common stock,
constituting approximately 1.3% of the shares outstanding.
(iii) In the aggregate, the Reporting Persons beneficially own
1,767,276 shares of the common stock, constituting approximately 49.0% of the
shares outstanding.
(b) (i) Steel Partners II has the sole power to vote and dispose of the
shares owned by it, which power is exercisable by Mr. Lichtenstein.
(ii) Lichtenstein has the sole power to vote and dispose of the
shares owned by him.
(iii) Pursuant to the terms of the Services Agreement, Services has the
sole power to vote and dispose of the shares reported herein as being held for
the account of Quota, which power is exercisable by Lichtenstein.
(iv) Except as set forth in this Item 5 with respect to Steel Partners
II, Services, and Lichtenstein, each Reporting Person disclaims beneficial
ownership in the shares held by each other.
(c) No Reporting Person has engaged in any transaction in the shares of
Issuer's common stock within the past 60 days except that:
Steel Partners II made the following purchase:
Date No. Of Shares Purchase Price
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8/29/96 561,000 $2.25
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|CUSIP NO. 367595105 | | Page 9 of 11 pages |
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Services made the following purchase:
Date No. Of Shares Purchase Price
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8/29/96 778,000 $2.25
Lichtenstein made the following purchase:
Date No. Of Shares Purchase Price
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8/29/96 29,814 $2.25
(d) No person other than each respective owner of the shares referred
to herein is known to have the right to receive, or the power to direct the
receipt of dividends from, or to the proceeds from, the sale of such shares of
the common stock.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer.
Except as set forth herein, no Reporting Person is currently party to
any contract, arrangement, understanding or relationship with respect to the
common stock of the Issuer.
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|CUSIP NO. 367595105 | | Page 10 of 11 pages |
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Item 7. Material to be Filed as Exhibits.
1. Schedule of trading by Reporting Persons from February 21, 1994
through April 21, 1994 (previously filed).
2. Form of Agreement of Limited Partnership of Steel Partners II
(previously filed).
3. Form of Proxy held by Messrs. Lichtenstein and Butler (previously
filed).
4. Letter Agreement, dated April 21, 1994 between Steel Partners II,
L.P. and Ronald Hayes (previously filed).
5. Letter Agreement, dated April 20, 1994 between Steel Partners II,
L.P. and Adage, Inc. (previously filed).
6. Powers of Attorney from each Reporting Person to Mr. Butler and Mr.
Lichtenstein (previously filed).
7. Joint Filing Agreement, pursuant to Rule 13d-1(f), among Steel
Partners II and each of the Reporting Persons, except Dr. Cadigan (previously
filed).
8. Letter Agreement, dated April 27, 1994 between the Issuer and
Patrick Cadigan and Steel Partners II, Warren Lichtenstein, Jack Howard and
Ronald Hayes (previously filed).
9. Joint Filing Agreement, pursuant to Rule 13d-1(f), among Steel
Partners II and each of the Reporting Persons (previously filed).
10. Power of Attorney from Patrick Cadigan to Mr. Butler and Mr.
Lichtenstein (previously filed).
11. Asset Purchase Agreement, dated June 14, 1994 between the Issuer
and Microdyne Peyton Street Corporation (previously filed).
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|CUSIP NO. 367595105 | | Page 11 of 11 pages |
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SIGNATURES
After reasonable inquiry and to the best of their knowledge
and belief, the undersigned certifies that the information set
forth in this statement is true, complete and correct.
Dated: September 4, 1996 STEEL PARTNERS II, L.P.
By: Steel Partners L.L.C.
General Partner
By: /s/ Warren G. Lichtenstein
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Warren G. Lichtenstein
STEEL PARTNERS SERVICES, LTD.
By: /s/ Warren G. Lichtenstein
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Warren G. Lichtenstein
By: /s/ Warren G. Lichtenstein
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Warren G. Lichtenstein
