Heat 12-inch nonstick skillet over medium heat. Add onion; cook 3 to 4 minutes, stirring frequently, just until it begins to brown. Stir in sugar and water. Reduce heat to medium-low; cover and cook 6 to 8 minutes, stirring frequently, until onion is tender and golden. Remove from heat; stir in vinegar.
Meanwhile, heat closed contact grill for 5 minutes. Rub pepper blend on both sides of each steak.
When grill is heated, place steaks on bottom grill surface. Close grill; cook 3 to 5 minutes or until desired doneness. Serve steaks with onions.