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**UNITEDSTATES**

**SECURITIESAND EXCHANGE COMMISSION**

**Washington,D.C. 20549**

 

**FORM 10-K/A**

 

**(Amendment No. 3)**

 
| **o**  | ** ** | **ANNUAL  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE  ACT OF 1934**     |
|--------|------------|----------------------------------------------------------------------------------------------------------|
|   |       | ** **                                                                                               |
|   |       | **For  the Fiscal Year Ended December 31, 2007**                                                    |
|   |       | ** **                                                                                               |
| **o**  | ** ** | **TRANSITION  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE  ACT OF 1934** |

 

**CommissionFile No. 1-14316**

 

**HERBSTGAMING, INC.**

 (Exact name of Registrant as specified in itscharter)

 

| **Nevada**                                 | ** ** | **88-0446145**                           |
|--------------------------------------------|------------|------------------------------------------|
| (State of  incorporation)                  |       | (I.R.S. Employer  Identification Number) |
|                                       |       |                                     |
| **3440  West Russell Road, Las Vegas, NV** | ** ** | **89118**                                |
| (Address of  principal executive offices)  |       | (Zip Code)                               |

 

Registrant’stelephone number:**(702) 889-7695**

 

Securitiesregistered pursuant to Section 12(b) of the Act:

 

| **Not  Applicable**    | ** ** | **Not  Applicable**                          |
|------------------------|------------|----------------------------------------------|
| (Title of each  class) |       | (Name of each  exchange on which registered) |

 

Securitiesregistered pursuant to Section 12(g) of the Act: **Not Applicable**

 

Indicate by check mark ifthe registrant is a well-known seasoned issuer, as defined in Rule 405 ofthe Securities Act. Yes o No x

 

Indicate by check mark ifthe registrant is not required to file reports pursuant to Section 13 or Section 15(d) ofthe Act. Yes o  No x

 

Indicate by check markwhether the Registrant (1) has filed all reports required to be filed by Section 13or 15(d) of the Securities Exchange Act of 1934 during the preceding 12months (or for such shorter period that the registrant was required to filesuch reports), and (2) has been subject to such filing requirements forthe past 90 days.   Yes  x  No  o

 

Indicate by check mark ifdisclosure of delinquent filers pursuant to Item 405 of Regulation S-K is notcontained herein, and will not be contained, to the best of Registrant’sknowledge, in definitive proxy or information statements incorporated byreference in Part III of this Form 10-K or any amendment to this Form 10-K. Applicable o   NotApplicable  x

 

Indicate by check markwhether the registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer or a smaller reporting company (as defined in Rule 12b-2of the Act):

 
| Large accelerated filer  o | Accelerated filer  o | Non-accelerated filer  x | Smaller reporting company  o |
|--------------------------------------|--------------------------------|------------------------------------|----------------------------------------|

 

Indicate by check markwhether the Registrant is a shell company (as defined in Rule 12b-2 of theExchange Act). Yes  o  No  x

 

The aggregate marketvalue of the shares of voting and non-voting common equity held bynon-affiliates of the Registrant as of December 31, 2007, based on theprice at which the common equity was sold, was approximately $0.

 

Indicate the number ofshares outstanding of each of the Registrant’s classes of common stock, as of December 31,2007.

 

Common Stock, no parvalue, 300 outstanding shares.

 

**DocumentsIncorporated by Reference**

 

None.

 

 

 

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EXPLANATORY NOTE

 

This Amendment No. 3 to the AnnualReport on Form 10-K/A of Herbst Gaming, Inc. (the “Company”) amendsthe Company’s Form 10-K for the fiscal year ended December 31, 2007(the “Initial Form 10-K”), which was filed on March 31, 2008, asamended and restated on From 10-K/A (the “Amended Form 10-K”), which wasfiled on April 1, 2008, and was further amended by Amendment No. 2 tothe Annual Report on From 10-K/A, which was filed on August 28, 2008 (“AmendmentNo. 2”, and together with the Amended Form 10-K, the “Form 10-K”).

 

 This Amendment No. 3 on Form 10-K/Ais being filed to amend the disclosure under Item 9A (Controls andProcedures) of Part II of the Form 10-K in order to reflectmanagement’s conclusion that due to the failure to include all of thedisclosures required in management’s report on internal control over financialreporting, the Company’s disclosure controls and procedures were not effectiveas of December 31, 2007.

 

Except as described above, no otherchanges have been made to the Form 10-K, and this Amendment No. 3 on Form 10-K/Adoes not amend, update or change the financial statements or any other items ordisclosures in the Form 10-K. While this Amendment No. 3 on Form 10-K/Areflects Amendment No. 2, it does not reflect any other events occurringafter the filing of the Amended Form 10-K, or modify or update thosedisclosures, including any exhibits to the Amended Form 10-K affected bysubsequent events. Accordingly, this Amendment No. 3 on Form 10-K/Ashould be read in conjunction with our filings made with the Securities andExchange Commission subsequent to the filing of the Amended Form 10-K/A.

 

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**TABLEOF CONTENTS**

 
| PART II |                                        |
|--------------|---------------------------------------------|
| Item 9A.     | Controls and Procedures                     |
|         |                                        |
| PART IV |                                        |
| Item  15.    | Exhibits and Financial  Statement Schedules |

 

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**SIGNATURES**

 

Pursuant to therequirements of Section 13 or 15(d) of the Securities Exchange Act of1934, the registrant has duly caused this Amendment No. 3 to the annualreport on Form 10-K/A to be signed on its behalf by the undersigned,thereunto duly authorized.

 
|                           | **HERBST  GAMING, INC.** |
|--------------------------------|--------------------------|
|                           | ** **               |
| ** **                     | ** **               |
|  September 30,  2008 | By:            |   | /s/ Troy D. Herbst |
|                           | Name:                    | Troy D. Herbst |
|                           | Title:                   | Chief Executive Officer |
|                           |                     | and Executive Vice  President |

 

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**PART II**

 

**Item9A.** **Controls andProcedures.**

 

*DisclosureControls and Procedures.*We maintain “disclosure controls and procedures” (as defined in Rule 13a-15(e) underthe Exchange Act) that are designed to ensure that information required to bedisclosed in our Exchange Act reports is recorded, processed, summarized andreported within the time periods specified in the SEC’s rules and forms,and that such information is accumulated and communicated to our management,including our Chief Executive Officer and Chief Financial Officer, asappropriate, to allow for timely decisions regarding required disclosure. Indesigning and evaluating the disclosure controls and procedures, managementrecognizes that any controls and procedures, no matter how well designed andoperated, can provide only reasonable assurance of achieving the desiredcontrol objectives, and management is required to apply its judgment inevaluating the cost-benefit relationship of possible controls and procedures. Nevertheless,there can be no assurance that either this evaluation process or our existingdisclosure controls and procedures will prevent or detect all errors and allfraud, if any, or result in accurate and reliable disclosure. A control systemcan provide only reasonable and not absolute assurance that the objectives ofthe control system are met. Because of the inherent limitations in all controlsystems, no evaluation of controls can provide absolute assurance that allcontrol issues and instances of fraud, if any, have been detected. Additionally,judgments in decision-making can be faulty and breakdowns in internal controlcan occur because of simple errors or mistakes that are not detected on atimely basis.

 

A re-evaluation ofthe effectiveness of our disclosure controls and procedures, as of December 31,2007, was carried out under the supervision and with the participation of theCompany’s management, including our Chief Executive Officer and Chief FinancialOfficer.  Based upon this re-evaluation of our disclosure controls andprocedures, our Chief Executive Officer and Chief Financial Officer concludedthat our disclosure controls and procedures were ineffective as of December 31,2007.  Management’s report on internal control over financial reporting,which is included below and was included in Amendment No. 2 to thisreport, omitted certain required disclosures in this annual report asoriginally filed on March 31, 2008.  Because of this inadvertentomission, our Chief Executive Officer and Chief Financial Officer conducted there-evaluation and reached the conclusion that our disclosure controls andprocedures were ineffective as of December 31, 2007.  Management hastaken steps to ensure that future filings contain management’s report oninternal control over financial reporting in its entirety.

 

*InternalControl over Financial Reporting.*Management is responsible for establishing andmaintaining adequate internal control over financial reporting (as defined in Rule 15d-15(f) underthe Exchange Act) for the Company. Our internal control over financialreporting is a process designed to provide reasonable assurance regarding thereliability of financial reporting and the preparation of financial statementsfor external purposes in accordance with generally accepted accountingprinciples in the United States. Because of its inherent limitations, internalcontrol over financial reporting may not prevent or detect misstatements. Also,projections of any evaluation or effectiveness to future periods are subject torisk that controls may become inadequate because of changes in conditions orbecause the degree of compliance with policies or procedures may deteriorate.

 

As of theEvaluation Date, we carried out an evaluation, under the supervision and withthe participation of our management, including our Chief Executive Officer andour Chief Financial Officer, of the effectiveness of the design and operationof our internal control over financial reporting utilizing criteria establishedin *Internal Control-Integrated Framework*issuedby the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

 

As previouslydisclosed in our prior public filings, our Chief Executive Officer and ChiefFinancial Officer identified a material weakness in our internal control forthe quarter ended March 31, 2007, which consisted of a failure to have inplace sufficient documentation as required by generally accepted accountingprinciples in order to permit interest rate swaps in the notional amount of$350.0 million to properly qualify as a hedge of a corresponding principleamount under our credit agreement. During the fourth quarter of 2007, theCompany terminated this interest rate swap. Prior to the institution of any newinterest rate swap arrangements, the Company will develop an internal policyregarding hedging transactions that sets forth the required procedures and documentationin order to permit such transactions undertaken by us to qualify for hedgeaccounting.

 

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Management believesthat the financial statements included in this report fairly present, in allmaterial respects, our financial condition, results of operations and cashflows.

 

Based on theevaluation and findings, discussed above the Company’s management concluded thatinternal control over financial reporting was effective as of December 31,2007.

 

There has been nochange in our internal control over financial reporting during the fourthquarter ended December 31, 2007 that has materially affected, or isreasonably likely to materially affect, our internal control over financialreports.

 

This annual report doesnot include an attestation report of the Company’s registered public accountingfirm regarding internal control over financial reporting. Management’s reportwas not subject to the attestation by the Company’s registered publicaccounting firm pursuant to temporary rules of the SEC that permit theCompany to provide only management’s report in this annual report.

 

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