SC 13D/A 1 sc13da2_gateway.txt AMENDMENT NO. 2 ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (AMENDMENT NO. 2) GATEWAY, INC. (Name of Issuer) COMMON STOCK, $0.01 PAR VALUE (Title of Class of Securities) 367626108 (CUSIP Number) WILLIAM R. LUCAS, JR. ONE RIVERCHASE PARKWAY SOUTH BIRMINGHAM, ALABAMA 35244 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) OCTOBER 25, 2006 (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 that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [_]. Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent. (1) The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). ================================================================================ --------------------------- --------------------------- CUSIP NO. 367626108 Page 2 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Harbinger Capital Partners Master Fund I, Ltd. -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS WC -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 27,155,930 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 27,155,930 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,155,930 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 7.3% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 3 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Harbinger Capital Partners Offshore Manager, L.L.C. -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS AF -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 27,155,930 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 27,155,930 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,155,930 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 7.3% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON OO -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 4 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON HMC Investors, L.L.C. -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS AF -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 27,155,930 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 27,155,930 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,155,930 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 7.3% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON OO -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 5 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Harbinger Capital Partners Special Situations Fund, L.P. -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 12,594,070 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 12,594,070 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,594,070 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.4% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON PN -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 6 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Harbinger Capital Partners Special Situations GP, LLC -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 12,594,070 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 12,594,070 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,594,070 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.4% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON OO -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 7 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON HMC - New York, Inc. -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION New York -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 12,594,070 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 12,594,070 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,594,070 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 3.4% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 8 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Harbert Management Corporation -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS AF -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 39,750,000 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 39,750,000 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 39,750,000 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.7% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON CO -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 9 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Philip Falcone -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS AF -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION U.S.A. -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 39,750,000 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 39,750,000 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 39,750,000 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.7% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 10 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Raymond J. Harbert -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS AF -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION U.S.A. -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 39,750,000 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 39,750,000 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 39,750,000 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.7% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 11 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Michael D. Luce -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS AF -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION U.S.A. -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES 39,750,000 BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER 39,750,000 -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 39,750,000 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.7% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 12 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Scott Galloway -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS PF -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION U.S.A. -------------------------------------------------------------------------------- 7 SOLE VOTING POWER 200,000 ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES -0- BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH 200,000 ------------------------------------------------ 10 SHARED DISPOSITIVE POWER -0- -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 200,000 -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN -------------------------------------------------------------------------------- --------------------------- --------------------------- CUSIP NO. 367626108 Page 13 of 21 --------------------------- --------------------------- SCHEDULE 13D -------------------------------------------------------------------------------- NAME OF REPORTING PERSON 1 S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON Firebrand Partners III, LLC (1) -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [_] (b) [X] -------------------------------------------------------------------------------- 3 SEC USE ONLY -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [_] -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ------------------------------------------------ 8 SHARED VOTING POWER NUMBER OF SHARES -0- BENEFICIALLY OWNED ------------------------------------------------ BY EACH REPORTING 9 SOLE DISPOSITIVE POWER PERSON WITH -0- ------------------------------------------------ 10 SHARED DISPOSITIVE POWER -0- -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON -0- -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [_] -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.0% -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON OO -------------------------------------------------------------------------------- ------------- (1) Scott Galloway is the managing member of Firebrand Partners III, LLC. --------------------------- --------------------------- CUSIP NO. 367626108 Page 14 of 21 --------------------------- --------------------------- SCHEDULE 13D Pursuant to Rule 13d-2(a) of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended (the "Act"), the undersigned hereby amends the Schedule 13D Statement, dated August 21, 2006, as amended by Amendment No. 1 thereto filed on September 29, 2006, filed by Harbinger Capital Partners Master Fund I, Ltd. (the "Master Fund"), Harbinger Capital Partners Offshore Manager, L.L.C. ("Harbinger Management"), the investment manager of the Master Fund, HMC Investors, L.L.C., its managing member ("HMC Investors"), Harbinger Capital Partners Special Situations Fund, L.P. (the "Special Fund"), Harbinger Capital Partners Special Situations GP, LLC, the general partner of the Special Fund ("HCPSS"), HMC - New York, Inc., the managing member of HCPSS ("HMCNY"), Harbert Management Corporation ("HMC"), the managing member of HMC Investors and the parent of HMCNY, Philip Falcone, a member of HMC and the portfolio manager of the Master Fund and the Special Fund, Raymond J. Harbert, a shareholder of HMC, Michael D. Luce, a shareholder of HMC, Firebrand Partners III, LLC ("Firebrand") and Scott Galloway, the managing member of Firebrand (each of the Master Fund, Harbinger Management, HMC Investors, HMC, Special Fund, HCPSS, HMCNY, Philip Falcone, Raymond J. Harbert, Michael D. Luce, Scott Galloway and Firebrand may be referred to herein as a "Reporting Person" and collectively may be referred to as "Reporting Persons"), relating to the common stock, par value $0.01 per share (the "Shares"), of Gateway, Inc. (the "Issuer"). This Amendment No. 2 to the Schedule 13D is being filed on behalf of the Reporting Persons. Item 1. SECURITY AND ISSUER. No material change. Item 2. IDENTITY AND BACKGROUND. No material change. Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. No material change. Item 4. PURPOSE OF TRANSACTION. Item 4 is hereby amended by adding the following before the final paragraph thereof: "On October 25, 2006, Firebrand, on behalf of the Reporting Persons, sent a letter to Richard Snyder, Chairman of the Board of the Issuer, and Ed Coleman, Chief Executive Officer of the Issuer, regarding actions it desired that the board of directors of the Issuer take. Specifically, the Reporting Persons urged the Issuer to de-classify its board, eliminate its shareholder rights plan and appoint three Firebrand designees to the board. A copy of the letter is attached hereto as an exhibit and is incorporated herein by reference." Item 5. INTEREST IN SECURITIES OF THE ISSUER. No material change. Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. No material change. Item 7. MATERIAL TO BE FILED AS EXHIBITS. Exhibit F: Agreement between the Reporting Persons to file jointly. Exhibit I: Letter to Issuer dated October 25, 2006. --------------------------- --------------------------- CUSIP NO. 367626108 Page 15 of 21 --------------------------- --------------------------- SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. HARBINGER CAPITAL PARTNERS MASTER FUND I, LTD. By: Harbinger Capital Partners Offshore Manager, L.L.C. Investment Manager By: HMC Investors, L.L.C., Managing Member By: /s/ Joel B. Piassick ------------------------------------ Name: Joel B. Piassick Title: Executive Vice President HARBINGER CAPITAL PARTNERS OFFSHORE MANAGER, L.L.C. By: HMC Investors, L.L.C., Managing Member By: /s/ Joel B. Piassick ------------------------------------ Name: Joel B. Piassick Title: Executive Vice President HMC INVESTORS, L.L.C. By: /s/ Joel B. Piassick ------------------------------------ Name: Joel B. Piassick Title: Executive Vice President --------------------------- --------------------------- CUSIP NO. 367626108 Page 16 of 21 --------------------------- --------------------------- HARBINGER CAPITAL PARTNERS SPECIAL SITUATIONS FUND, L.P. By: Harbinger Capital Partners Special Situations GP, LLC General Partner By: HMC - New York, Inc. Managing Member By: /s/ William R. Lucas, Jr. ------------------------------------ Name: William R. Lucas, Jr. Title: Senior Vice President & General Counsel HARBINGER CAPITAL PARTNERS SPECIAL SITUATIONS GP, LLC By: HMC - New York, Inc. Managing Member By: /s/ William R. Lucas, Jr. ------------------------------------ Name: William R. Lucas, Jr. Title: Senior Vice President & General Counsel HMC - NEW YORK, INC. By: /s/ William R. Lucas, Jr. ------------------------------------ Name: William R. Lucas, Jr. Title: Senior Vice President & General Counsel HARBERT MANAGEMENT CORPORATION By: /s/ William R. Lucas, Jr. ------------------------------------ Name: William R. Lucas, Jr. Title: Senior Vice President & General Counsel FIREBRAND PARTNERS III, LLC By: /s/ Scott Galloway ---------------------------------- Name: Scott Galloway Title: Managing Member --------------------------- --------------------------- CUSIP NO. 367626108 Page 17 of 21 --------------------------- --------------------------- /s/ Philip Falcone --------------------------------- Philip Falcone /s/ Raymond J. Harbert --------------------------------- Raymond J. Harbert /s/ Michael D. Luce --------------------------------- Michael D. Luce /s/ Scott Galloway --------------------------------- Scott Galloway October 25, 2006 Attention. Intentional misstatements or omissions of fact constitute federal criminal violations (see 18 U.S.C. 1001). --------------------------- --------------------------- CUSIP NO. 367626108 Page 18 of 21 --------------------------- --------------------------- EXHIBIT F AGREEMENT Each of the undersigned hereby acknowledges and agrees, in compliance with the provisions of Rule 13d-1(k)(1) promulgated under the Securities Exchange Act of 1934, as amended, that the Schedule 13D to which this Agreement is attached as an Exhibit (the "Schedule 13D"), and any amendments thereto, will be filed with the Securities and Exchange Commission jointly on behalf of the undersigned. This Agreement may be executed in one or more counterparts. HARBINGER CAPITAL PARTNERS MASTER FUND I, LTD. By: Harbinger Capital Partners Offshore Manager, L.L.C. Investment Manager By: HMC Investors, L.L.C., Managing Member By: /s/ Joel B. Piassick ------------------------------------ Name: Joel B. Piassick Title: Executive Vice President HARBINGER CAPITAL PARTNERS OFFSHORE MANAGER, L.L.C. By: HMC Investors, L.L.C., Managing Member By: /s/ Joel B. Piassick ------------------------------------ Name: Joel B. Piassick Title: Executive Vice President HMC INVESTORS, L.L.C. By: /s/ Joel B. Piassick ------------------------------------ Name: Joel B. Piassick Title: Executive Vice President --------------------------- --------------------------- CUSIP NO. 367626108 Page 29 of 21 --------------------------- --------------------------- HARBINGER CAPITAL PARTNERS SPECIAL SITUATIONS FUND, L.P. By: Harbinger Capital Partners Special Situations GP, LLC General Partner By: HMC - New York, Inc. Managing Member By: /s/ William R. Lucas, Jr. ------------------------------------ Name: William R. Lucas, Jr. Title: Senior Vice President & General Counsel HARBINGER CAPITAL PARTNERS SPECIAL SITUATIONS GP, LLC By: HMC - New York, Inc. Managing Member By: /s/ William R. Lucas, Jr. ------------------------------------ Name: William R. Lucas, Jr. Title: Senior Vice President & General Counsel HMC - NEW YORK, INC. By: /s/ William R. Lucas, Jr. ------------------------------------ Name: William R. Lucas, Jr. Title: Senior Vice President & General Counsel HARBERT MANAGEMENT CORPORATION By: /s/ William R. Lucas, Jr. ------------------------------------ Name: William R. Lucas, Jr. Title: Senior Vice President & General Counsel FIREBRAND PARTNERS III, LLC By: /s/ Scott Galloway ---------------------------------- Name: Scott Galloway Title: Managing Member --------------------------- --------------------------- CUSIP NO. 367626108 Page 20 of 21 --------------------------- --------------------------- /s/ Philip Falcone --------------------------------- Philip Falcone /s/ Raymond J. Harbert --------------------------------- Raymond J. Harbert /s/ Michael D. Luce --------------------------------- Michael D. Luce /s/ Scott Galloway --------------------------------- Scott Galloway October 25, 2006 --------------------------- --------------------------- CUSIP NO. 367626108 Page 21 of 21 --------------------------- --------------------------- EXHIBIT I [Firebrand Letterhead] October 25, 2006 Gateway, Inc. 7565 Irvine Center Drive Irvine, CA 92618 Attn: Richard Snyder and Ed Coleman Dear Rick and Ed: I hope this letter finds the two of you well. The discussions we have had over the last two months have confirmed our original thesis: there is nothing wrong with Gateway that can't be fixed with what's right with Gateway. We believe there is a great deal of common ground and that we share a workable vision of how shareholder value can be restored. As the scale of our share purchases suggests, we believe the opportunity to increase shareholder value is dramatic. However, we also believe it is perishable and demands decisive action on the part of the Board. We are troubled that the Board appears to lack the sense of urgency to address the Company's challenges and capitalize on its opportunities. A company with a great brand and channel strength, but 5.5% gross margins, requires a Board whose oversight and experience can aid in the development and articulation of a strategy to improve margins. We believe that continued inertia at the Board level is unacceptable. If, working together, we cannot leverage these assets, then they should be put in the hands of an organization that can (i.e., the Company should be sold). To that end, we are requesting that the Board do the following: o Appoint three Firebrand designees to the Gateway Board of Directors; o Redeem the Company's shareholder rights plan ("Poison Pill"); and o Call a special meeting of shareholders for the purpose of adopting an amendment to the Company's certificate of incorporation to declassify the Board. The Board's skills set should reflect its needs. We believe the addition of three Firebrand designees will bring much needed domain expertise in brand and design to the boardroom that can immediately aid management's efforts to create customer differentiation and improve margins. In addition, staggered boards and poison pills are relics of a by-gone era; weapons of mass entrenchment that do nothing but hamstring shareholder value. The steps we have outlined above reflect our continued enthusiasm and resolve to work with the Board and management for the benefit of all Gateway shareholders. We request a response by October 31, 2006 to confirm your intention to comply with our requests. If we do not hear from you, we will take your silence as a sign of unwillingness to work together and will pursue these matters on our own, through the calling of a special meeting or otherwise. As always, I'm reachable at 917-567-2841 or sgalloway@firebrandpartners.com Regards, /s/ Scott Galloway ------------------ Scott Galloway Firebrand Partners