UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K/A
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 13, 2014
 
AMERICAN MIDSTREAM PARTNERS, LP
(Exact name of registrant as specified in its charter)

	

Delaware	 	001-35257	 	27-0855785	
(State or other jurisdiction
of incorporation)	 	(Commission
File Number)	 	(I.R.S. Employer
Identification No.)	
 	 	
1400 16th Street, Suite 310
Denver, Colorado	 	80202	
(Address of principal executive offices)	 	(Zip Code)	

Registrant’s telephone number, including area code: (720) 457-6060
Not applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

		
¨
	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	

		
¨
	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	

		
¨
	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	

		
¨
	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

Explanatory Note

On October 14, 2014, American Midstream Partners, LP (the “Partnership”) filed a current report on Form 8-K (the “Original Filing”) in connection with the completion of its acquisition of Costar Midstream, LLC (the “Company”) from Energy Spectrum Partners VI LP and Costar Midstream Energy, LLC (collectively, “Sellers”) on October 13, 2014 (the “Closing Date”).

The Company’s assets consist of onshore gathering and processing with its primary gathering, processing, fractionation, and off-spec condensate treating and stabilization assets in East Texas and the prolific Permian basin, with a significant crude oil gathering system project underway in the Bakken oil play (collectively, “the Costar Assets”). The historical financial statements presented in Exhibit 99.4 relate to the Costar Assets.

The Partnership is filing this Form 8-K/A to provide certain audited and unaudited financial statements of the Costar Assets and unaudited pro forma consolidated financial statements of the Partnership as required by Item 9.01(a) and Item 9.01(b) of Form 8-K. This information was not included in the the Original Filing.

Item 9.01 Financial Statements and Exhibits

(a) Financial Statements of Businesses Acquired

The Condensed Consolidated Financial Statements of the Costar Assets as of September 30, 2014, and for the nine months ended September 30, 2014 and 2013 (unaudited) are filed herewith as Exhibit 99.4. The Consolidated Financial Statements of the Costar Assets as of December 31, 2013 and 2012, and for the years ended December 31, 2013, 2012 and 2011 (audited), including the notes thereto, are filed herewith as Exhibit 99.5.

(b) Pro forma financial information

The Unaudited Pro Forma Condensed Consolidated Financial Statements of American Midstream Partners, LP as of September 30, 2014, for the nine months ended September 30, 2014, and for the year ended December 31, 2013, including the notes thereto, are filed herewith as Exhibit 99.6.

(d) Exhibits

			
Exhibit No.	 	Description	
2.1	 	Purchase and Sale Agreement, dated October 13, 2014, by and among American Midstream, LLC, Energy Spectrum Partners VI LP (filed as Exhibit 2.1 to the Original Filing)	
4.1	 	Securities Agreement, dated October 13, 2014, by and among American Midstream Partners, LP, Energy Spectrum Partners VI LP (filed as Exhibit 4.1 to the Original Filing)	
23.1	 	Consent of Independent Accounting Firm - Hein and Associates, LLP	
99.1	 	Press Release regarding the Acquisition dated October 14, 2014 (filed as Exhibit 99.1 to the Original Filing)	
99.2	 	Investor Presentation regarding the Acquisition dated October 14, 2014 (filed as Exhibit 99.2 to the Original Filing)	
99.3	 	Updated American Midstream Investor Presentation dated October 14, 2014 (filed as Exhibit 99.3 to the Original Filing)	
99.4	 	Condensed Consolidated Financial Statements of Costar as of September 30, 2014, for the nine months ended September 30, 2014 and 2013 (unaudited) and as of December 31, 2013, including the notes thereto.	
99.5	 	Consolidated Financial Statements of Costar as of December 31, 2013 and 2012 and for the three years ended December 31, 2013 (audited), including the notes thereto.	
99.6	 	Unaudited Pro Forma Condensed Consolidated Financial Statements of American Midstream Partners, LP as of September 30, 2014, for the nine months ended September 30, 2014 and for the year ended December 31, 2013, including the notes thereto.	

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	
					
 	 	American Midstream Partners, LP	
 	 	
 	 	By: American Midstream GP, LLC,	
 	 	its General Partner	
Date:	 	 	
December 23, 2014	 	By:	 	/s/ Daniel C. Campbell	
 	 	Name:	 	Daniel C. Campbell	
 	 	Title:	 	Senior Vice President and Chief Financial Officer	

3

Exhibit Index

			
Exhibit No.	 	Description	
2.1	 	Purchase and Sale Agreement, dated October 13, 2014, by and among American Midstream, LLC, Energy Spectrum Partners VI LP (filed as Exhibit 2.1 to the Original Filing)	
4.1	 	Securities Agreement, dated October 13, 2014, by and among American Midstream Partners, LP, Energy Spectrum Partners VI LP (filed as Exhibit 4.1 to the Original Filing)	
23.1	 	Consent of Independent Accounting Firm - Hein and Associates, LLP	
99.1	 	Press Release regarding the Acquisition dated October 14, 2014 (filed as Exhibit 99.1 to the Original Filing)	
99.2	 	Investor Presentation regarding the Acquisition dated October 14, 2014 (filed as Exhibit 99.2 to the Original Filing)	
99.3	 	Updated American Midstream Investor Presentation dated October 14, 2014 (filed as Exhibit 99.3 to the Original Filing)	
99.4	 	Condensed Consolidated Financial Statements of Costar as of September 30, 2014, for the nine months ended September 30, 2014 and 2013 (unaudited) and as of December 31, 2013, including the notes thereto.	
99.5	 	Consolidated Financial Statements of Costar as of December 31, 2013 and 2012 and for the three years ended December 31, 2013 (audited), including the notes thereto.	
99.6	 	Unaudited Pro Forma Condensed Consolidated Financial Statements of American Midstream Partners, LP as of September 30, 2014, for the nine months ended September 30, 2014 and for the year ended December 31, 2013, including the notes thereto.	

4

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-3 (No. 333-198888 and 333-183818) and S-8 (No. 333-183290 and 333-176438) of American Midstream Partners, LP of our report dated February 19, 2014 relating to our audit of the consolidated financial statements of Costar Midstream, LLC as of and for the three years ended December 31, 2013, which is included in the Current Report on Form 8‑K/A filed by American Midstream Partners, LP on December 23, 2014.

/s/ Hein and Associates LLP
Dallas, Texas
December 23, 2014

Exhibit 99.4

COSTAR MIDSTREAM, LLC
INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

	
		
 	Page	
Condensed consolidated balance sheets as of September 30, 2014 and December 31, 2013	2	
Condensed consolidated statements of operations for the nine months ended September 30, 2014 and 2013	3	
Condensed consolidated statement of changes in members' capital for the nine months ended September 30, 2014 and the year ended December 31, 2013	4	
Condensed consolidated statements of cash flows for the nine months ended September 30, 2014 and 2013	5	
Notes to the condensed consolidated financial statements	6	

Exhibit 99.4

COSTAR MIDSTREAM, LLC
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)

											
 	 	 	 	September 30, 2014	 	December 31, 2013	
 	 	 	 	(unaudited)	 	 	
ASSETS:	 	 	 	
 	Current assets	 	 	 	
 	 	Cash and cash equivalents	$	9,609		 	$	6,829		
 	 	Restricted cash	414		 	22,325		
 	 	Accounts receivable	11,497		 	15,131		
 	 	Commodity derivatives	37		 	144		
 	 	Prepaid expenses and other current assets	323		 	199		
 	 	Assets of discontinued operations held for sale	604		 	712		
 	 	 	Total current assets	22,484		 	45,340		
 	Property and equipment, net	201,892		 	163,642		
 	Commodity derivatives	61		 	—		
 	Deposits and other assets	68		 	8		
 	Processing contracts, net of accumulated amortization of $100 and $65, respectively	187		 	220		
 	Deferred loan fees, net of accumulated amortization of $716 and $552, respectively	387		 	551		
 	Note receivable from managing member	3,564		 	3,461		
 	 	Total assets	$	228,643		 	$	213,222		
 	 	 	 	
LIABILITIES AND MEMBERS' CAPITAL:	 	 	 	
 	Current liabilities	 	 	 	
 	 	Accounts payable and accrued liabilities	$	18,785		 	$	12,701		
 	 	Financial instrument derivatives	108		 	196		
 	 	Commodity derivatives	126		 	531		
 	 	Liabilities of discontinued operations held for sale	128		 	117		
 	 	Current portion of long-term debt	10,000		 	10,000		
 	 	 	Total current liabilities	29,147		 	23,545		
 	Long-term liabilities	 	 	 	
 	 	Revolving line of credit	11,000		 	—		
 	 	Term loan	37,500		 	45,000		
 	 	Contingent consideration payable	9,174		 	4,547		
 	 	Financial derivatives	—		 	30		
 	 	Commodity derivatives	12		 	356		
 	 	Deferred income taxes	269		 	285		
 	 	 	Total liabilities	87,102		 	73,763		
 	Commitments and contingencies, Note 3, 4 and 7	 	 	 	
 	 	 	 	 	
 	Members' capital	141,541		 	139,459		
 	 	 	Total liabilities and members' capital	$	228,643		 	$	213,222		
               
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

2

Exhibit 99.4

  COSTAR MIDSTREAM, LLC
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands)

	
									
 	 	Nine Months ended September 30,	
 	 	2014	 	2013	
 	 	(unaudited)	
 	 	 	 	 	
Operating revenue	$	123,018		 	$	120,256		
 	 	 	 	 	
Operating costs and expenses:	 	 	 	
 	Cost of revenues	87,430		 	83,553		
 	Operating expenses	10,451		 	9,455		
 	Administrative expenses	2,457		 	1,968		
 	Depreciation and amortization expense	15,043		 	14,017		
 	     Total operating expenses	115,381		 	108,993		
 	 	 	 	
 	  Income from operations	7,637		 	11,263		
 	 	 	 	 	
 	Other income (expense):	 	 	 	
 	 Interest expense	(1,389	)	 	(1,413	)	
 	 Acquisition expenses	—		 	(17	)	
 	 Unrealized commodity derivative gain (loss)	704		 	(2,008	)	
 	 Realized gain (loss) on commodity derivatives	(245	)	 	2,719		
 	 Unrealized loss on contingent consideration	(4,627	)	 	(145	)	
 	 Gain on sale of assets	21		 	13		
 	 Interest income from managing member	103		 	—		
 	   Total other income (expense)	(5,433	)	 	(851	)	
 	Income from continuing operations before taxes	2,204		 	10,412		
 	 	 	 	
 	State income taxes, current	15		 	2		
 	State income taxes, deferred	16		 	173		
 	 	 	 	 	
 	Income from continuing operations	2,173		 	10,237		
 	Gain (loss) from discontinued operations	(91	)	 	54		
 	Net income	$	2,082		 	$	10,291		

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

3

Exhibit 99.4

 
COSTAR MIDSTREAM, LLC
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN MEMBERS' CAPITAL
(in thousands)

	
					
 	 	Members' Capital	
Balance, December 31, 2012	$	105,798		
 	   Contributions	23,000		
 	   Net income	10,661		
Balance, December 31, 2013	139,459		
 	   Net income	2,082		
Balance, September 30, 2014 (unaudited)	$	141,541		

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

4

Exhibit 99.4

 
COSTAR MIDSTREAM, LLC
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

										
 	 	 	Nine months ended September 30,	
 	 	 	2014	 	2013	
 	 	 	(unaudited)	
Cash flows from operating activities	 	 	 	
 	Net income	$	2,082		 	$	10,291		
 	Adjustments to reconcile net cash provided by operating activities:	 	 	 	
 	 	Depreciation and amortization	15,043		 	14,017		
 	 	Amortization of deferred loan costs and contingent consideration	164		 	186		
 	 	Unrealized loss on contingent consideration	4,627		 	145		
 	 	Interest income from managing member	(103	)	 	—		
 	 	Gain on sale of asset	(21	)	 	(13	)	
 	 	Deferred income taxes	(16	)	 	108		
 	 	Changes in fair value of derivatives	(821	)	 	1,845		
 	Changes in assets and liabilities:	 	 	 	
 	 	Accounts receivable	3,634		 	3,411		
 	 	Prepaid and other current assets	(184	)	 	(304	)	
 	 	Accounts payable and other current liabilities	6,084		 	(1,345	)	
 	 	   Net cash provided by operating activities-continuing operations	30,489		 	28,341		
 	 	   Net cash provided by operating activities-discontinued operations	33		 	480		
 	 	Net cash provided by operating activities	30,522		 	28,821		
Cash flows from investing activities:	 	 	 	
 	Proceeds from sale of assets	32		 	21		
 	Change in restricted cash for construction of midstream assets	21,997		 	—		
 	Additions to property and equipment	(53,271	)	 	(7,506	)	
 	 	Net cash flows used in investing activities	(31,242	)	 	(7,485	)	
Cash flows from financing activities:	 	 	 	
 	Borrowing under credit facility	11,000		 	—		
 	Payments of amounts outstanding under credit facility	(7,500	)	 	(12,500	)	
 	 	Net cash flows provided by (used in) financing activities	3,500		 	(12,500	)	
 	 	Net change in cash and cash equivalents	2,780		 	8,836		
Cash and cash equivalents at beginning of period	6,829		 	2,041		
Cash and cash equivalents at end of period	$	9,609		 	$	10,877		
 	 	 	 	 	 	
Supplemental cash flow disclosures	 	 	 	
 	 	Cash paid for interest	$	1,232		 	$	1,429		
 	 	Cash paid for taxes	$	60		 	$	188		
 	 	 	 	 	
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

5

Exhibit 99.4

COSTAR MIDSTREAM, LLC
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

		
1.	Description of Business	

Costar Midstream LLC (the “Company”), a Texas limited liability company, was established on March 25, 2011 as a midstream natural gas business. Operations through December 31, 2011 consisted of the leasing of certain processing assets. The Company’s operations are established under the wholly owned subsidiaries Costar GS GP, LLC, Costar GS LP, LLC, Costar Bakken LLC. Costar Mesquite LLC, Costar East Texas Rail LLC and Costar Permian LLC, and the majority (75%) owned TranStar Gas Processing LLC (“TranStar”). On December 31, 2012, the Company committed to a plan to dispose of TranStar, and all operations of TranStar are therefore reclassified to discontinued operations at September 30, 2014 and 2013.

On January 4, 2012, Costar GS GP LLC and Costar GS LP LLC purchased all of the issued and outstanding general and limited partnership interests of Gas Solutions II Ltd, a Texas limited partnership. Gas Solutions II Ltd operates over 600 miles of gathering pipe and three cryogenic gas processing plants in East Texas. The partnership is owned by Costar GS GP, LLC (1% interest - general partner) and Costar GS LP, LLC (99% interest- limited partner).

On March 11, 2013, the Company established Costar Bakken LLC, a Texas limited liability company and wholly owned subsidiary, in order to construct and operate midstream oil assets in the Bakken. On August 19, 2013, the Company established Costar Permian LLC, a Texas limited liability company and wholly owned subsidiary, in order to construct and operate midstream natural gas assets in the Permian Basin. On August 15, 2014, the Company established Costar East Texas Rail LLC, in order to construct and operate a rail terminal in East Texas. Also on August 15, 2014, the Company established Costar Mesquite LLC.

The Company is organized as a limited liability company among Costar Midstream Energy, LLC, a Texas limited liability company, as managing member and Energy Spectrum Partners VI LP, a Delaware limited partnership, (“VI LP”).

2.	Summary of Significant Accounting Policies	

Principles of Consolidation
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly owned and majority-owned subsidiaries. All significant intercompany transactions have been eliminated in consolidation.

Reclassifications
The Company has committed to a plan to dispose of TranStar. As of January 1, 2012, all of the operations, as well as the resulting loss recognized from the exit activity, are reported as discontinued operations in the consolidated financial statements. See Note 4. Certain prior year amounts have been reclassified to conform with current year presentation.

Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

Restricted Cash
Cash held by TranStar is considered restricted pending the units’ disposition. Cash held by TranStar as of September 30, 2014 and December 31, 2013 was $414 and $500, respectively. Cash held by Costar Permian LLC exclusively for the construction of midstream natural gas assets in the Permian Basin of $21,825 at December 31, 2013 is considered restricted.

Accounts Receivable
Receivables consist of amounts due from the sale of natural gas liquid products and dry gas sales and the amounts billed for management and processing fees pursuant to operating agreements with various customers. Management periodically reviews accounts receivable amounts for collectability and records an allowance for uncollectible receivables under specific identification method. The Company recorded no allowance for uncollectible receivables at September 30, 2014 or December 31, 2013.

Fair Value of Financial Instruments

6

Exhibit 99.4

Financial instruments consist of cash, trade receivables, trade payables, and accrued liabilities. The carrying value of cash and cash equivalents, trade receivables, trade payables and accrued liabilities are considered to be representative of their fair market value, due to the short maturity of these instruments.

Processing Equipment
Processing equipment is recorded at cost less accumulated depreciation. Depreciation expense is provided using the straight-line method, which, in the opinion of management, is adequate to allocate the costs of these assets over the estimated useful lives as follows:

	
			
Processing plant	 	10 years	
Pipeline and related equipment	 	10 years	
Buildings	 	25 years	
Office equipment and vehicles	 	3 to 10 years	

Processing equipment consists of the following:

									
 	 	September 30, 2014	 	December 31, 2013	
Processing plant	 	$	56,053		 	$	55,542		
Pipeline and related equipment	 	141,710		 	138,924		
Buildings	 	1,881		 	1,702		
Construction in progress	 	50,793		 	2,455		
Land	 	1,402		 	341		
Office equipment and vehicles	 	1,493		 	1,119		
Total processing equipment	 	$	253,332		 	$	200,083		

Expenditures for maintenance and repairs are expensed as incurred. Costs of major replacements and betterments are capitalized. When property is retired or otherwise disposed of, the cost and accumulated depreciation are removed from appropriate accounts and any gain or loss is included in income. Depreciation expense of $15,043 and $14,017 was recognized on other property and processing equipment for the nine months ended September 30, 2014 and 2013, respectively.

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may be impaired. Based upon this evaluation, the Company recorded no impairment for the nine months ended September 30, 2014 and 2013, respectively.

Note Receivable - Managing Member
On October 30, 2013, the Company entered into a $3,437 promissory note receivable with its managing member. Interest accrues at an annual rate of 4%. The note is due and payable in full upon the date that the Company makes any distribution to the holders of any equity interest. Interest income from the managing member was $103 for the nine months ended September 30, 2014.

Deferred Financing Costs
The Company incurred debt issuance costs in the course of obtaining financing under a credit facility. These costs are recorded on the balance sheet and amortized over the term of the debt using the straight-line method, which approximates the effective yield method. Amortization expense of $164 and $186 was recorded for the nine months ended September 30, 2014 and 2013, respectively, on deferred financing costs using the effective yield method and are included in interest expense.

Revenue
The Company generates revenue from gas gathering/compression, NGL processing, transportation, fractionation services, and trucked condensate stabilization. NGL products are sold at Mt. Belvieu, TX pricing and condensate is sold at OPIS pricing. Compression, transportation and fractionation services are contract based fees. Related cost of sales are either a percentage of proceeds, wellhead purchase, or redelivered equivalent wellhead volumes. All products are metered and revenues are recognized on a monthly basis for product delivered.

Derivative Activity

7

Exhibit 99.4

The Company entered into certain commodity and financial derivative contracts to reduce their exposure to fluctuations in natural gas liquids prices and future interest rate increases. Derivative instruments are not designated as cash flow hedges for accounting purposes. Unrealized gains and losses, at fair value, are included on the balance sheet as current or non-current assets or liabilities based on the anticipated timing of cash settlements under the related contracts. Changes in the fair values of commodity derivative instruments and cash flows resulting from the settlement of instruments are included in other income (expense) in the statement of operations. Changes in the fair value of the financial derivative instrument and cash flows resulting from the settlement of that instrument are included in interest expense in the statement of operations. See Note 5.

Processing Contracts
Acquired processing equipment contracts are amortized using the effective interest method over the estimated remaining lives of the contracts of approximately 7 years. Amortization expense of $33 and $46 was recognized on processing contracts costs using the straight-line method amortization on these processing contracts for the nine months ended September 30, 2014 and 2013, respectively.

Income Taxes
The Company is not subject to federal income taxation because the effects of its activities accrue to the members. Accordingly, no provision for federal income taxes is included in the accompanying financial statements. The Company remains liable for state income taxes. The Company accounts for state income taxes in accordance with the asset and liability method of accounting for income taxes. Deferred income taxes are recognized for the tax consequences of temporary differences, at enacted statutory rates, between the financial statement carrying amounts and the tax bases of existing assets and liabilities. Income tax expense or benefit represents the current tax payable or refundable for the period, plus or minus the tax effect of the net change in the deferred tax assets and liabilities. The Company has reflected in the accompanying financial statements their liability for state income taxes due and payable by the Company. The primary difference resulting in a deferred tax liability reflected in the financial statements is the result of differences between book and tax depreciation.

The Company is subject to certain provisions related to uncertain tax positions. The Company has reviewed their pass-through status and determined no uncertain tax positions exist. The Company’s income tax returns for the years 2013, 2012 and 2011 remain open for examination by the respective federal and state authorities.

Risks and Uncertainties
The Company maintains their cash balances primarily in one financial institution. The balances are partially insured by the Federal Deposit Insurance Corporation (“FDIC”). At September 30, 2014, the Company had uninsured cash balances which exceeded FDIC insured limits.

Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

3.	Contingent Consideration	

In January 2012, the Company purchased all of the issued and outstanding general and limited partnership interests of Gas Solutions II Ltd, a Texas limited partnership, for $172,526 cash plus a contingent payment whose estimated fair value was determined to be $4,164 and is capped at $28,000. As of December 31, 2013, the contingent payment was based upon 20% of cash flow after a return of 200% initial investment adjusted for debt principal and interest payments, and income taxes. As of September 30, 2014, the Company estimated the fair value based upon the Company's sales price (see Note 9). Unrealized loss on this contingent consideration was $4,627 and $145 for the nine months ended September 30, 2014 and 2013, respectively.

4.	Discontinued Operations	

On December 31, 2012, the Company committed to a plan to dispose of TranStar. The assets and liabilities related to TranStar are reported as assets and liabilities held for sale in the consolidated balance sheet at September 30, 2014 and December 31, 2013, and TranStar operations are classified as discontinued operations.

Discontinued operations on the consolidated statement of operations for the nine months ended September 30, 2014 and 2013 are as follows:

8

Exhibit 99.4

	
									
 	 	2014	 	2013	
Revenue	 	$	113		 	$	238		
Operating and administrative expenses	 	98		 	179		
Depreciation and amortization	 	106		 	5		
Net income (loss) from discontinued operations	 	$	(91	)	 	$	54		

The impairment of assets held for sale resulted from the adjustment of assets and liabilities held for sale to estimated fair value. The Company estimated fair value based on market quotes and third-party valuation indicators.

As of September 30, 2014 and December 31, 2013, assets and liabilities as held for sale on the consolidated balance sheet consisted the following:

									
 	 	September 30, 2014	 	December 31, 2013	
Assets held for sale:	 	 	 	 	
Accounts receivable	 	—		 	—		
Prepaid expenses	 	2		 	3		
Processing equipment, net	 	602		 	709		
Total assets held for sale	 	$	604		 	$	712		
 	 	 	 	 	
Liabilities held for sale:	 	 	 	 	
Accrued expenses	 	$	128		 	$	9		
Security deposits	 	—		 	108		
Total liabilities held for sale	 	$	128		 	$	117		

5.	DERIVATIVES	

Derivatives consist of commodity derivatives and an interest rate swap arrangement. The Company entered into certain commodity and financial derivative contracts to reduce its exposure to fluctuations in natural gas liquids prices and future interest rates. These derivative instruments are not designated as cash flow hedges.

Commodity Derivatives
The following is a summary of the Company’s natural gas liquids commodity derivatives at September 30, 2014. Natural gas liquids volumes are measured in gallons (“gals”):

																
Production
Period	 	Type	 	Product	 	Product
Volumes	 	Weighted
Average
Price	 	Fair Market
Value	 	Commodity
Derivative
Classification	
Oct 2014 - Sept 2015	 	Collar	 	Propane	 	5,159,000		 	$0.75 - $1.19	 	$	(102	)	 	Short-term liability	
Oct 2015 - Mar 2016	 	Collar	 	Propane	 	1,312,000		 	$0.80 - $1.29	 	(12	)	 	Long-term liability	
Nov 2015 - Apr 2016	 	Collar	 	Propane	 	1,670,000		 	$0.85 - $1.32	 	3		 	Long-term asset	
Oct 2014 - Sept 2015	 	Collar	 	IButane	 	1,230,000		 	$1.03 - $1.60	 	14		 	Short-term asset	
Oct 2015 - Sept 2016	 	Collar	 	IButane	 	657,000		 	$0.99 - $1.55	 	5		 	Long-term asset	
Oct 2014 - Sept 2015	 	Collar	 	NButane	 	2,421,000		 	$0.99 - $1.55	 	23		 	Short-term asset	
Oct 2015 - Sept 2016	 	Collar	 	IButane	 	1,417,000		 	$0.97 - $1.52	 	13		 	Long-term asset	
Oct 2014 - Sept 2015	 	Collar	 	Nat Gas	 	5,065,000		 	$1.47 - $2.29	 	(24	)	 	Short-term liability	
Oct 2015 - Sept 2016	 	Collar	 	Nat Gas	 	3,044,000		 	$1.50 - $2.34	 	40		 	Long-term asset	

The following is a summary of the Company’s natural gas liquids commodity derivatives at December 31, 2013. Natural gas liquids volumes are measured in gallons (“gals”):

9

Exhibit 99.4

	
																
Production
Period	 	Type	 	Product	 	Product Volumes	 	Weighted
Average
Price	 	Fair Market Value	 	Commodity Derivative Classification	
Jan - May 2014	 	Collar	 	Ethane	 	1,528,000		 	$0.29 - $0.46	 	$	41		 	Short-term asset	
Jan - Dec 2014	 	Collar	 	Propane	 	4,810,000		 	$0.73 - $1.13	 	(366	)	 	Short-term liability	
Jan - Jul 2015	 	Collar	 	Propane	 	2,970,000		 	$0.74 - $1.17	 	(178	)	 	Long-term liability	
Jan - Nov 2014	 	Collar	 	NButane	 	2,040,000		 	$1.15 - $1.76	 	59		 	Short-term asset	
Dec - Dec 2014	 	Collar	 	NButane	 	212,000		 	$0.98 - $1.54	 	(9	)	 	Short-term liability	
Jan - Jul 2015	 	Collar	 	NButane	 	1,373,000		 	$0.97 - $1.51	 	(62	)	 	Long-term liability	
Jan - Nov 2014	 	Collar	 	IButane	 	1,166,000		 	$1.22 - $1.88	 	44		 	Short-term asset	
Dec - Dec 2014	 	Collar	 	IButane	 	118,000		 	$1.02 - $1.58	 	(5	)	 	Short-term liability	
Jan - Jul 2015	 	Collar	 	IButane	 	682,000		 	$1.00 - $1.55	 	(24	)	 	Long-term liability	
Jan - Dec 2014	 	Collar	 	Natural Gas	 	4,625,000		 	$1.53 - $2.30	 	(151	)	 	Short-term liability	
Jan - Jul 2015	 	Collar	 	Natural Gas	 	2,904,000		 	$1.48 - $2.31	 	(92	)	 	Long-term liability	

Changes in the fair values of the Company’s commodity contracts are recorded in earnings as they occur and included in other income (expense). Realized gains and losses are also included in other income (expense). For the nine months ended September 30, 2014, the Company recognized an unrealized gain of $704 and a realized loss of $245 on commodity derivative instruments. For the nine months ended September 30, 2013, the Company recognized an unrealized loss of $2,008 and a realized gain of $2,719 on commodity derivative instruments.

Interest Rate Swap Agreement
On February 14, 2012, the Company entered into a three-year LIBOR interest rate basis swap contract. Under the terms of the transaction, the Company will pay, in one-month intervals, a fixed rate of 1.23% and the counterparty will pay the prevailing one-month LIBOR rate. The notional value amortizes on a monthly basis until expiration on April 1, 2015. As of September 30, 2014, the notional value was $40,375.

Unrealized gains and losses, at fair value, are included on the Company’s balance sheet as current or noncurrent assets and liabilities based on the anticipated timing of settlements under the related contracts. As of September 30, 2014, the Company had recorded a current liability of $108. As of December 31, 2013, the Company had recorded a current liability of $196 and non-current liability of $30.

Changes in the fair value of the Company’s financial derivative contracts are recorded in earnings as they occur and are included in interest expense. Realized gains and losses are also included in interest expense. For the nine months ended September 30, 2014, the Company recognized an unrealized gain of $117 and a realized loss of $175 on financial derivative instruments. For the nine months ended September 30, 2013, the Company recognized an unrealized gain of $163 and a realized losses of $194, respectively, on financial derivative instruments.

Fair Value
Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company uses market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company primarily applies the market approach for recurring fair value measurements and attempt to use the best available information. Accounting standards establish a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and lowest priority to unobservable inputs (Level 3 measurement). The three levels of fair value hierarchy are as follows:

Level 1: Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. At September 30, 2014 and December 31, 2013, the Company had no Level 1 measurements.
Level 2: Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Where observable inputs are available, directly or indirectly, for substantially the full term of the asset or liability, the instrument is categorized in Level 2. At

10

Exhibit 99.4

September 30, 2014 and December 31, 2013, the Company’s commodity and financial derivatives were measured using Level 2 measurements.
Level 3: Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. As of September 30, 2014 and December 31, 2013, the contingent liability described at Note 3 estimated fair value was measured using level 3 measurements. The only change during the nine months ended September 30, 2014 was $4,627, resulting from the change in fair value.

6.	Credit Facility	

The Company financed the Gas Solutions acquisition utilizing a $70,000 term debt with a seven-year payment amortization maturing on November 30, 2016, and a $35,000 revolving line of credit maturing on January 4, 2017. As of September 30, 2014, there is an outstanding balance of $11,000 on the revolving line of credit. The interest rate offers a Eurodollar or prime rate component plus an applicable margin grid based upon various leverage ratios and includes a commitment fee. The debt is collateralized by a security interest to all property of the Company, whether now or hereafter existing, owned, arising, or acquired. The effective interest rate as of September 30, 2014 was 2.24% on the term debt and 3.88% on the revolving line of credit.

Subject to the terms and conditions of the credit facility, the Company may require issue of letters of credit in an aggregate amount of $10,000. A $25 letter of credit has been drawn as of September 30, 2014.

Under the terms of the credit facility, the Company must maintain certain financial ratios including a ratio of debt to EBITDA of no more than 4.0 to 1.0 and an EBITDA to fixed charges ratio of no less than 1.25 to 1.0. At September 30, 2014, the Company was in compliance with these debt covenants.

Future scheduled maturities of debt existing at September 30, 2014 are as follows:

	
					
2015	 	10,000		
2016	 	48,500		
 	 	$	58,500		

On October 22, 2013, Costar Permian LLC entered into a Security Agreement which issued a $3,450 and a $3,000 standby letter of credit in relation to the construction of certain midstream natural gas assets in the Permian Basin.

7.	Commitments and Contingencies	

On October 2, 2013, the Company entered into a Gas Processing and Gathering Agreement with an independent oil and natural gas producer. This contract specifies that Costar Permian LLC must commence to take delivery and process certain minimum amounts of product by July 1, 2014. This contract required the construction of certain midstream assets and contained a liquidated damages penalty if Costar does not meet this obligation. Prior to meeting the obligation in September 2014, the Company incurred $926 in penalties for the nine months ended September 30, 2014, which is included in cost of revenues.

On June 12, 2014, the Company entered into a Gas Processing and Gathering Agreement with an independent oil and natural gas producer. This contract requires the construction of certain midstream assets before December 12, 2016 and contains a maximum liquidated damages penalty of $1,512 if the Company does not meet this obligation.

8.	Concentration of Credit Risk	

During the nine months ended September 30, 2014, the Company derived 85% of its revenues from six customers. The major customers had accounts receivable balances totaling $7,285 at September 30, 2014. During the nine months ended September 30, 2013, the Company derived 90% of its revenues from six customers.

9.	Subsequent Events	

Subsequent events were assessed through December 23, 2014, the date this report was available for issuance.

11

Exhibit 99.4

On October 13, 2014, the Company was  acquired by American Midstream, LLC for a total purchase price of $471.5 million. The total purchase price consisted of 6.9 million American Midstream common units valued at $199.9 million in the purchase and sale agreement, and $271.6 million of cash.

12

Exhibit 99.5

COSTAR MIDSTREAM, LLC
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	
		
 	Page	
Independent Auditor's Report
	2	
Consolidated balance sheets as of December 31, 2013 and December 31, 2012	3	
Consolidated statements of operations for each of the two years ended December 31, 2013 and for the period from March 25, 2011 (inception) through December 31, 2011	4	
Consolidated statement of changes in members' capital for the years ended December 31, 2013, December 31, 2012 and for the period from March 25, 2011 (inception) through December 31, 2011	5	
Consolidated statements of cash flows for the years ended December 31, 2013, December 31, 2012 and for the period from March 25, 2011 (inception) through December 31, 2011	6	
Notes to the consolidated financial statements	8	

Exhibit 99.5

INDEPENDENT AUDITOR’S REPORT

To the Members
Costar Midstream LLC
Dallas, Texas

We have audited the accompanying consolidated financial statements of Costar Midstream LLC and subsidiaries, (collectively, the “Company”) which comprise the consolidated balance sheets as of December 31, 2013 and 2012, and the related consolidated statements of operations, members’ capital and cash flows for each of the years ended December 31, 2013 and 2012 and for the period from March 25, 2011 (inception) through December 31, 2011, and the related notes to the financial statements.

Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Costar Midstream LLC as of December 31, 2013 and 2012, and the results of their operations and their cash flows for each of the years ended December 31, 2013 and 2012 and for the period from March 25, 2011 (inception) through December 31, 2011 in accordance with accounting principles generally accepted in the United States of America.

Hein & Associates LLP
Dallas, Texas
February 19, 2014

2

Exhibit 99.5

COSTAR MIDSTREAM, LLC
CONSOLIDATED BALANCE SHEETS
(in thousands)

											
 	 	 	 	December 31,	
 	 	 	 	2013	 	2012	
ASSETS:	 	 	 	
 	Current assets	 	 	 	
 	 	Cash and cash equivalents	$	6,829		 	$	2,041		
 	 	Restricted cash	22,325		 	855		
 	 	Accounts receivable	15,131		 	15,534		
 	 	Commodity derivatives	144		 	3,061		
 	 	Prepaid expenses and other current assets	199		 	102		
 	 	Assets of discontinued operations held for sale	712		 	1,258		
 	 	 	Total current assets	45,340		 	22,851		
 	Property and equipment, net	163,642		 	169,042		
 	Commodity derivatives	—		 	62		
 	Deposits	8		 	7		
 	Processing contracts, net of accumulated amortization of $65 and $4, respectively	220		 	282		
 	Deferred loan fees, net of accumulated amortization of $552 and $308, respectively	551		 	795		
 	Note receivable from managing member	3,461		 	—		
 	 	Total assets	$	213,222		 	$	193,039		
 	 	 	 	
LIABILITIES AND MEMBERS' CAPITAL:	 	 	 	
 	Current liabilities	 	 	 	
 	 	Accounts payable and accrued liabilities	$	12,701		 	$	11,792		
 	 	Financial instrument derivatives	196		 	233		
 	 	Commodity derivatives	531		 	—		
 	 	Liabilities of discontinued operations held for sale	117		 	113		
 	 	Current portion of long-term debt	10,000		 	10,000		
 	 	 	Total current liabilities	23,545		 	22,138		
 	Long-term liabilities	 	 	 	
 	 	Revolving line of credit	—		 	5,000		
 	 	Term loan	45,000		 	55,000		
 	 	Contingent consideration payable	4,547		 	4,352		
 	 	Financial derivatives	30		 	171		
 	 	Commodity derivatives	356		 	513		
 	 	Deferred income taxes	285		 	67		
 	 	 	Total liabilities	73,763		 	87,241		
 	Commitments and contingencies (Note 3, 4 and 7)	 	 	 	
 	 	 	 	 	
 	Members' capital	119,000		 	96,000		
 	Retained earnings	20,459		 	9,798		
 	 	 	Total liabilities and members' capital	$	213,222		 	$	193,039		

The accompanying notes are an integral part of these audited consolidated financial statements.

3

Exhibit 99.5

  COSTAR MIDSTREAM, LLC
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands)

	
															
 	 	Year Ended December 31,	 	March 25, 2011 (Inception) through December 31, 2011	
 	 	2013	 	2012	 	2011	

Operating revenue	$	155,772		 	$	127,836		 	$	—		
 	 	 	 	 	 	 	
Operating costs and expenses:	 	 	 	 	 	
 	Cost of revenues	107,595		 	84,775		 	—		
 	Operating expenses	13,094		 	10,531		 	27		
 	Administrative expenses	2,828		 	1,875		 	824		
 	Acquisition expense	18		 	2,792		 	439		
 	Depreciation and amortization expense	18,897		 	17,607		 	9		
 	     Total operating expenses	142,432		 	117,580		 	1,299		
 	 	 	 	 	 	
 	  Income (loss) from operations	13,340		 	10,256		 	(1,299	)	
 	 	 	 	 	 	 	
 	Other income (expense):	 	 	 	 	 	
 	Interest expense	(1,902	)	 	(3,378	)	 	—		
 	Realized commodity derivative gain	3,352		 	3,397		 	—		
 	Unrealized commodity derivative gain (loss)	(3,531	)	 	2,610		 	—		
 	Gain on sale of assets	33		 	—		 	—		
 	Interest income from managing member	24		 	—		 	—		
 	Total other income (expense)	(2,024	)	 	2,629		 	—		
 	 	 	 	 	 	 	
 	Net loss attributable to noncontrolling interests	—		—		—		—		(55	)	
 	Income (loss) from continuing operations before taxes	11,316		 	12,885		 	(1,354	)	
 	 	 	 	 	 	
 	State income taxes, current	(28	)	 	(128	)	 	—		
 	State income taxes, deferred	(282	)	 	(67	)	 	—		
 	 	 	 	 	 	 	
 	Income (loss) from continuing operations	11,006		 	12,690		 	(1,354	)	
 	Loss from discontinued operations	(345	)	 	(1,428	)	 	(165	)	
 	Net income (loss)	$	10,661		 	$	11,262		 	$	(1,519	)	

The accompanying notes are an integral part of these audited consolidated financial statements.

4

Exhibit 99.5

 
COSTAR MIDSTREAM, LLC
CONSOLIDATED STATEMENTS OF CHANGES IN MEMBERS' CAPITAL
(in thousands)

	
													
 	 	Members' Capital	 	Non-Controlling Interest	 	Total Members' Capital	
Balance, March 25, 2011 (inception)	$	—		 	$	—		 	$	—		
 	   Contributions	5,000		 	—		 	5,000		
 	   Contribution by non-controlling interest	—		 	1,250		 	1,250		
 	   Net loss	(1,464	)	 	(55	)	 	(1,519	)	
Balance, December 31, 2011	3,536		 	1,195		 	4,731		
 	   Contributions	91,000		 	—		 	91,000		
 	   Distributions	—		 	(29	)	 	(29	)	
 	   Reclassification of discontinued operations	—		 	(1,166	)	 	(1,166	)	
 	   Net income	11,262		 	—		 	11,262		
Balance, December 31, 2012	105,798		 	—		 	105,798		
 	   Contributions	23,000		 	—		 	23,000		
 	   Net income	10,661		 	—		 	10,661		
Balance, December 31, 2013	$	139,459		 	$	—		 	$	139,459		

The accompanying notes are an integral part of these audited consolidated financial statements.

5

Exhibit 99.5

 
COSTAR MIDSTREAM, LLC
CONSOLIDATED STATEMENTS OF CASH FLOWS

	
															
 	 	 	 	Year ended December 31,	 	March 25, 2011 (Inception) through December 31, 2011
	
 	 	 	 	2013	 	2012	 	2011	
Cash flows from operating activities	 	 	 	 	 	 	
 	Net income	 	$	10,661		 	$	11,262		 	$	(1,519	)	
 	Adjustments to reconcile net cash provided by operating activities:	 	 	 	 	 	 	
 	 	Depreciation and amortization	 	18,897		 	17,957		 	993		
 	 	Amortization of deferred loan costs and contingent consideration	 	439		 	496		 	—		
 	 	Interest income from managing member	 	(24	)	 	—		 	—		
 	 	Gain on sale of asset	 	(33	)	 	—		 	—		
 	 	Deferred income taxes	 	282		 	67		 	—		
 	 	Changes in fair value of derivatives	 	3,175		 	(2,206	)	 	—		
 	Changes in assets and liabilities:	 	 	 	 	 	 	
 	 	Accounts receivable	 	403		 	(6,158	)	 	—		
 	 	Restricted cash	 	—		 	—		 	(928	)	
 	 	Prepaid and other current assets	 	(98	)	 	21		 	(22	)	
 	 	Accounts payable and other current liabilities	 	845		 	2,496		 	771		
 	 	   Net cash provided by operating activities-continuing operations	 	34,547		 	23,935		 	(705	)	
 	 	   Net cash provided by operating activities-discontinued operations	 	905		 	1,535		 	—		
 	 	Net cash provided by (used in) operating activities	 	35,452		 	25,470		 	(705	)	
Cash flows from investing activities:	 	 	 	 	 	 	
 	Acquisition of Gas Solutions, net of cash acquired	 	—		 	(171,357	)	 	—		
 	Acquisition of Transtar	 	—		 	—		 	(3,750	)	
 	Restricted cash for construction of midstream natural gas assets	 	(21,825	)	 	—		 	—		
 	Note receivable from managing member	 	(3,437	)	 	—		 	—		
 	Proceeds from sale of assets	 	41		 	—		 	—		
 	Acquisition of Danville Gathering System	 	—		 	(7,500	)	 	—		
 	Additions to property and equipment	 	(13,443	)	 	(4,767	)	 	(39	)	
 	 	Net cash flows used in investing activities	 	(38,664	)	 	(183,624	)	 	(3,789	)	
Cash flows from financing activities:	 	 	 	 	 	 	
 	Capital contributions	 	23,000		 	91,000		 	5,000		
 	Deferred financing costs	 	—		 	(1,103	)	 	(179	)	
 	Borrowing under credit facility	 	—		 	87,500		 	—		
 	Distribution to non-controlling interest	 	—		 	(29	)	 	—		
 	Payments of amounts outstanding under credit facility	 	(15,000	)	 	(17,500	)	 	—		
 	 	Net cash flows provided by financing activities	 	8,000		 	159,868		 	4,821		
 	 	Net change in cash and cash equivalents	 	4,788		 	1,714		 	327		
Cash and cash equivalents at beginning of period	 	2,041		 	327		 	—		
Cash and cash equivalents at end of period	 	$	6,829		 	$	2,041		 	$	327		

6

Exhibit 99.5

	
															
Supplemental cash flow disclosures	 	 	 	 	 	 	
 	Assets acquired for contingent consideration	 	$	—		 	$	4,164		 	$	—		
 	 	Non-cash acquisition of processing equipment for non-controlling interest	 	$	—		 	$	—		 	$	1,250		
 	 	Cash paid for interest	 	$	2,068		 	$	2,095		 	$	—		
 	 	Cash paid for taxes	 	$	60		 	$	—		 	$	—		

The accompanying notes are an integral part of these audited consolidated financial statements.

7

Exhibit 99.5

COSTAR MIDSTREAM, LLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

		
1.	Description of Business	

Costar Midstream LLC (the “Company”), a Texas limited liability company, was established on March 25, 2011 as a midstream natural gas business. Operations through December 31, 2011 consisted of the leasing of certain processing assets. The Company’s operations are established under the wholly owned subsidiaries Costar GS GP, LLC, Costar GS LP, LLC, and Costar Permian LLC, and the majority (75%) owned TranStar Gas Processing LLC (“TranStar”). On December 31, 2012, the Company committed to a plan to dispose of TranStar, and all operations of TranStar are therefore reclassified to discontinued operations at December 31, 2013, 2012 and 2011.

On January 4, 2012, Costar GS GP LLC and Costar GS LP LLC purchased all of the issued and outstanding general and limited partnership interests of Gas Solutions II Ltd, a Texas limited partnership. Gas Solutions II Ltd operates over 600 miles of gathering pipe and three cryogenic gas processing plants in East Texas. The partnership is owned by Costar GS GP, LLC (1% interest - general partner) and Costar GS LP, LLC (99% interest- limited partner).

On August 19, 2013, the Company established Costar Permian LLC, a Texas limited liability company and wholly owned subsidiary, in order to construct and operate midstream natural gas assets in the Permian Basin.

The Company is organized as a limited liability company among Costar Midstream Energy, LLC, a Texas limited liability company, as managing member and Energy Spectrum Partners VI LP, a Delaware limited partnership, (“VI LP”).

2.	Summary of Significant Accounting Policies	

Principles of Consolidation
The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and include the accounts of the Company and its wholly owned and majority-owned subsidiaries. All significant intercompany transactions have been eliminated in consolidation.

Reclassifications
The Company has committed to a plan to dispose of TranStar. As of January 1, 2012, all of the operations, as well as the resulting loss recognized from the exit activity, are reported as discontinued operations in the consolidated financial statements. Prior period operations have been reclassified to discontinued operations. See Note 4.

Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

Restricted Cash
Cash held by TranStar is considered restricted pending the units’ disposition. Cash held by TranStar as of December 31, 2013 and 2012 was $500 and $855, respectively. Cash held by Costar Permian LLC exclusively for the construction of midstream natural gas assets in the Permian Basin of $21,825 at December 31, 2013 is considered restricted.

Accounts Receivable
Receivables consist of amounts due from the sale of natural gas liquid products and dry gas sales and the amounts billed for management and processing fees pursuant to operating agreements with various customers. Management periodically reviews accounts receivable amounts for collectability and records an allowance for uncollectible receivables under specific identification method. The Company recorded no allowance for uncollectible receivables at December 31, 2013 and 2012.

Fair Value of Financial Instruments
Financial instruments consist of cash, trade receivables, trade payables, and accrued liabilities. The carrying value of cash and cash equivalents, trade receivables, trade payables and accrued liabilities are considered to be representative of their fair market value, due to the short maturity of these instruments.

8

Exhibit 99.5

Processing Equipment
Processing equipment is recorded at cost less accumulated depreciation. Depreciation expense is provided using the straight-line method, which, in the opinion of management, is adequate to allocate the costs of these assets over the estimated useful lives as follows:

	
			
Processing plant	 	10 years	
Pipeline and related equipment	 	10 years	
Buildings	 	25 years	
Office equipment and vehicles	 	3 to 10 years	

Processing equipment consists of the following:

					
 	 	2013	 	2012	
Processing plant	 	$55,542	 	$50,409	
Pipeline and related equipment	 	138,924	 	131,247	
Buildings	 	1,702	 	1,624	
Construction in progress	 	2,455	 	2,230	
Land	 	341	 	341	
Office equipment and vehicles	 	1,119	 	754	
Total processing equipment	 	$200,083	 	$186,605	

Expenditures for maintenance and repairs are expensed as incurred. Costs of major replacements and betterments are capitalized. When property is retired or otherwise disposed of, the cost and accumulated depreciation are removed from appropriate accounts and any gain or loss is included in income. Depreciation expense of $18,835 and $17,602 was recognized on other property and processing equipment for the years ended December 31, 2013 and 2012, respectively.

The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may be impaired. Based upon this evaluation, the Company recorded an impairment of $382 and $1,464 related to the discontinuation and sale of its interest in TranStar assets which are classified as held-for-sale for the years ended December 31, 2013 and 2012, respectively.

Note Receivable - Managing Member
On October 30, 2013, the Company entered into a $3,437 promissory note receivable with its managing member. Interest accrues at an annual rate of 4%. The note is due and payable in full upon the date that the Company makes any distribution to the holders of any equity interest. Interest income from the managing member was $24 for the year ended December 31, 2013.

Deferred Financing Costs
The Company incurred debt issuance costs in the course of obtaining financing under a credit facility. These costs are recorded on the balance sheet and amortized over the term of the debt using the straight-line method, which approximates the effective yield method. As of and for the year ended December 31, 2013 and 2012, amortization expense of $244 and $308, respectively, was recognized on deferred financing costs using the effective yield method and are included in interest expense. There was no amortization expense for the year ended December 31, 2011.

Revenue
The Company generates revenue from gas gathering/compression, NGL processing, transportation, fractionation services, and trucked condensate stabilization. NGL products are sold at Mt. Belvieu, TX pricing and condensate is sold at OPIS pricing. Compression, transportation and fractionation services are contract based fees. Related cost of sales are either a percentage of proceeds, wellhead purchase, or redelivered equivalent wellhead volumes. All products are metered and revenues are recognized on a monthly basis for product delivered.

Derivative Activity
The Company entered into certain commodity and financial derivative contracts to reduce their exposure to fluctuations in natural gas liquids prices and future interest rate increases. Derivative instruments are not designated

9

Exhibit 99.5

as cash flow hedges for accounting purposes. Unrealized gains and losses, at fair value, are included on the balance sheet as current or non-current assets or liabilities based on the anticipated timing of cash settlements under the related contracts. Changes in the fair values of commodity derivative instruments and cash flows resulting from the settlement of instruments are included in other income (expense) in the statement of operations. Changes in the fair value of the financial derivative instrument and cash flows resulting from the settlement of that instrument are included in interest expense in the statement of operations. See Note 5.

Processing Contracts
Acquired processing equipment contracts are amortized using the effective interest method over the estimated remaining lives of the contracts of approximately 7 years. Amortization expense of $62 and $5 was recognized on processing contracts costs using the straight-line method amortization on these processing contracts for the year ended December 31, 2013 and 2012, respectively. There was no amortization expense for the year ended December 31, 2011.

Income Taxes
The Company is not subject to federal income taxation because the effects of its activities accrue to the members. Accordingly, no provision for federal income taxes is included in the accompanying financial statements. The Company remains liable for state income taxes. The Company accounts for state income taxes in accordance with the asset and liability method of accounting for income taxes. Deferred income taxes are recognized for the tax consequences of temporary differences, at enacted statutory rates, between the financial statement carrying amounts and the tax bases of existing assets and liabilities. Income tax expense or benefit represents the current tax payable or refundable for the period, plus or minus the tax effect of the net change in the deferred tax assets and liabilities. The Company has reflected in the accompanying financial statements their liability for state income taxes due and payable by the Company. The primary difference resulting in a deferred tax liability reflected in the financial statements is the result of differences between book and tax depreciation.

The Company is subject to certain provisions related to uncertain tax positions. The Company has reviewed their pass-through status and determined no uncertain tax positions exist. The Company’s income tax returns for the years 2012 and 2011 remain open for examination by the respective federal and state authorities.

Risks and Uncertainties
The Company maintains their cash balances primarily in one financial institution. The balances are partially insured by the Federal Deposit Insurance Corporation (“FDIC”). At December 31, 2013, the Company had uninsured cash balances which exceeded FDIC insured limits.

Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

3.	Acquisition	

Acquisitions of property are accounted for as purchases and, accordingly, the associated revenue and expenses are included in the Company’s statement of operations from the closing date of the acquisition. Purchase prices are allocated to acquired assets and assumed liabilities based on their estimated fair value at the time of the acquisition.

Gas Solutions II, Ltd
In January 2012, the Company purchased all of the issued and outstanding general and limited partnership interests of Gas Solutions II Ltd, a Texas limited partnership, for $172,526 cash plus a contingent payment whose estimated fair value was determined to be $4,164 and is capped at $28,000. The contingent payment is based upon 20% of cash flow after a return of 200% initial investment adjusted for debt principal and interest payments, and income taxes. Amortization of this contingent consideration was $195 and $188 for the years ended December 31, 2013 and 2012, respectively, and is included in interest expense.

The transaction was funded by $91,000 of equity contributions and a syndicate bank facility consisting of a term note and revolving line of credit. See Note 6.

10

Exhibit 99.5

The fair value of the assets acquired and liabilities assumed were based on third-party appraisal and internal estimates utilizing replacement cost, depreciation factors, or other reasonable methods. The allocation to assets acquired and liabilities assumed as of January 4, 2012 were as follows:

	
							
Cash	 	 	 	$	1,169		
Accounts receivable	 	 	 	9,409		
Prepaids	 	 	 	104		
Processing equipment	 	 	 	174,664		
Total assets acquired	 	 	 	185,346		
 	 	 	 	 	
Accounts payable and accrued liabilities	 	 	 	8,656		
 	 	 	 	 	
Net assets acquired	 	 	 	$	176,690		

	
							
Purchase price:	 	 	 	 	
Cash consideration	 	 	 	$	172,526		
Contingent liability	 	 	 	4,164		
Total	 	 	 	$	176,690		

Danville Gathering System
In December 2012, the Company purchased certain gas gathering assets in East Texas, for $7,500 cash.

The assets acquired as of December 1, 2012 were as follows:

							
Gas gathering system	 	 	 	$	7,213		
Gas gathering contract	 	 	 	287		
Total assets acquired	 	 	 	$	7,500		

The gas gathering contract was recorded at estimated fair value based on significant inputs not observable in the market, which fair value accounting considers Level 3 inputs. The fair value of the contract was calculated using a percentage of the acquisition economics discounted at 4%.

4.	Discontinued Operations	

On December 31, 2012, the Company committed to a plan to dispose of TranStar. The assets and liabilities related to TranStar are reported as assets and liabilities held for sale in the consolidated balance sheet at December 31, 2013 and 2012, and TranStar operations are classified as discontinued operations.

Discontinued operations on the consolidated statement of operations for each of the three years ended December 31, 2013 are as follows:

													
 	 	2013	 	2012	 	2011	
Revenue	 	241		 	684		 	838		
Operating and administrative expenses	 	65		 	298		 	73		
Depreciation and amortization	 	139		 	350		 	984		
Impairment of assets held for sale	 	382		 	1,464		 	—		
Non-controlling interest share of loss	 	 	 	 	 	54		
Net loss from discontinued operations	 	$	(345	)	 	$	(1,428	)	 	$	(165	)	

The impairment of assets held for sale resulted from the adjustment of assets and liabilities held for sale to estimated fair value. The Company estimated fair value based on market quotes and third-party valuation indicators.

11

Exhibit 99.5

As of December 31, 2013 and 2012, assets and liabilities as held for sale on the consolidated balance sheet consisted the following:

	
									
 	 	2013	 	2012	
Assets held for sale:	 	 	 	 	
Accounts receivable	 	$	—		 	$	22		
Prepaid expenses	 	3		 	4		
Processing equipment, net	 	709		 	1,232		
Total assets held for sale	 	$	712		 	$	1,258		
 	 	 	 	 	
Liabilities held for sale:	 	 	 	 	
Accrued expenses	 	$	9		 	$	—		
Security deposits	 	108		 	113		
Total liabilities held for sale	 	$	117		 	$	113		

5.	Derivatives	

Derivatives consist of commodity derivatives and an interest rate swap arrangement. The Company entered into certain commodity and financial derivative contracts to reduce its exposure to fluctuations in natural gas liquids prices and future interest rates. These derivative instruments are not designated as cash flow hedges.

Commodity Derivatives
The following is a summary of the Company’s natural gas liquids commodity derivatives at December 31, 2013. Natural gas liquids volumes are measured in gallons (“gals”):

													
Production
Period	 	Type	 	Product	 	Product
Volumes	 	Weighted
Average
Price	 	Fair Market
Value	 	Commodity
Derivative
Classification	
Jan - May 2014	 	Collar	 	Ethane	 	1,528,000	 	$0.29 - $0.46	 	$41	 	Short-term asset	
Jan - Dec 2014	 	Collar	 	Propane	 	4,810,000	 	$0.73 - $1.13	 	(366)	 	Short-term liability	
Jan - Jul 2015	 	Collar	 	Propane	 	2,970,000	 	$0.74 - $1.17	 	(178)	 	Long-term liability	
Jan - Nov 2014	 	Collar	 	NButane	 	2,040,000	 	$1.15 - $1.76	 	59	 	Short-term asset	
Dec - Dec 2014	 	Collar	 	NButane	 	212,000	 	$0.98 - $1.54	 	(9)	 	Short-term liability	
Jan - Jul 2015	 	Collar	 	NButane	 	1,373,000	 	$0.97 - $1.51	 	(62)	 	Long-term liability	
Jan - Nov 2014	 	Collar	 	IButane	 	1,166,000	 	$1.22 - $1.88	 	44	 	Short-term asset	
Dec - Dec 2014	 	Collar	 	IButane	 	118,000	 	$1.02 - $1.58	 	(5)	 	Short-term liability	
Jan - Jul 2015	 	Collar	 	IButane	 	682,000	 	$1.00 - $1.55	 	(24)	 	Long-term liability	
Jan - Dec 2014	 	Collar	 	Natural Gas	 	4,625,000	 	$1.53 - $2.30	 	(151)	 	Short-term liability	
Jan - Jul 2015	 	Collar	 	Natural Gas	 	2,904,000	 	$1.48 - $2.31	 	(92)	 	Long-term liability	

The following is a summary of the Company’s natural gas liquids commodity derivatives at December 31, 2012. Natural gas liquids volumes are measured in gallons (“gals”):

													

Production
Period	 	Type	 	Product	 	Product Volumes	 	Weighted
Average
Price	 	Fair Market Value	 	Commodity Derivative Classification	
Jan - Dec 2013	 	Swap	 	Ethane	 	3,749,000	 	$0.59	 	$1,207	 	Short-term asset	
Jan - Dec 2013	 	Swap	 	Propane	 	4,397,000	 	$1.28	 	1,517	 	Short-term asset	
Jan - Dec 2013	 	Swap	 	IButane	 	1,080,000	 	$2.11	 	55	 	Short-term asset	
Jan - Dec 2013	 	Swap	 	NButane	 	2,056,000	 	$1.78	 	177	 	Short-term asset	
Jan - Dec 2013	 	Swap	 	Pentanes	 	3,853,000	 	$1.71	 	105	 	Short-term asset	
Jan - May 2014	 	Collar	 	Ethane	 	1,528,000	 	$0.29 - $0.46	 	62	 	Long-term asset	
Jan - July 2014	 	Collar	 	Propane	 	2,676,000	 	$0.72 - $1.11	 	(139)	 	Long-term liability	
Jan - July 2014	 	Collar	 	Nat Gas	 	2,576,000	 	$1.53 - $ 2.27	 	(181)	 	Long-term liability	
Jan - July 2014	 	Collar	 	IButane	 	   708,000	 	$1.23 - $1.89	 	(69)	 	Long-term liability	
Jan - July 2014	 	Collar	 	NButane	 	1,223,000	 	$1.16 - $1.76	 	(124)	 	Long-term liability	

12

Exhibit 99.5

Changes in the fair values of the Company’s commodity contracts are recorded in earnings as they occur and included in other income (expense). Realized gains and losses are also included in other income (expense). For the year ended December 31, 2013, the Company recognized an unrealized loss of $3,353 and a realized gain of $3,352 on commodity derivative instruments. For the year ended December 31, 2012, the Company recognized an unrealized gain of $2,610 and a realized gain of $3,397 on commodity derivative instruments.

Interest Rate Swap Agreement
On February 14, 2012, the Company entered into a three-year LIBOR interest rate basis swap contract. Under the terms of the transaction, the Company will pay, in one-month intervals, a fixed rate of 1.23% and the counterparty will pay the prevailing one-month LIBOR rate. The notional value amortizes on a monthly basis until expiration on April 1, 2015. As of December 31, 2013, the notional value was $46,750.

Unrealized gains and losses, at fair value, are included on the Company’s balance sheet as current or noncurrent assets and liabilities based on the anticipated timing of settlements under the related contracts. As of December 31, 2013, the Company had recorded a current liability of $196 and non-current liability of $30. As of December 31, 2012, the Company had recorded a current liability of $233 and non-current liability of $171.

Changes in the fair value of the Company’s financial derivative contracts are recorded in earnings as they occur and are included in interest expense. Realized gains and losses are also included in interest expense. For the year ended December 31, 2013, the Company recognized unrealized gain of $178 and a realized loss of $257 on financial derivative instruments. For the year ended December 31, 2012, the Company recognized unrealized and realized losses of $404 and $205, respectively, on financial derivative instruments.

Fair Value
Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The Company uses market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company primarily applies the market approach for recurring fair value measurements and attempt to use the best available information. Accounting standards establish a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and lowest priority to unobservable inputs (Level 3 measurement). The three levels of fair value hierarchy are as follows:

Level 1: Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. At December 31, 2013, the Company had no Level 1 measurements.
Level 2: Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 2 includes those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry-standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Where observable inputs are available, directly or indirectly, for substantially the full term of the asset or liability, the instrument is categorized in Level 2. At December 31, 2013, the Company’s commodity and financial derivatives were measured using Level 2 measurements.
Level 3: Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At the acquisition date, the contingent liability described at Note 3 estimated fair value was based upon 20% of cash flow of the Longview and Chapel Hill plants for the next five years after a return of 200% initial investment adjusted for debt principal and interest payments, and income taxes. There are no substantial changes to the contingent liability at December 31, 2013.

6.	Credit Facility	

The Company financed the Gas Solutions acquisition utilizing a $70,000 term debt with a seven-year payment amortization maturing on November 30, 2016, and a $35,000 revolving line of credit maturing on January 4, 2017. As of December 31, 2013, there is no outstanding balance on the revolving line of credit. The interest rate offers a Eurodollar or prime rate component plus an applicable margin grid based upon various leverage ratios and includes a commitment fee. The debt is collateralized by a security interest to all property of the Company, whether now or

13

Exhibit 99.5

hereafter existing, owned, arising, or acquired. The effective interest rate as of December 31, 2013 was 2.16% on the term debt.

Subject to the terms and conditions of the credit facility, the Company may require issue of letters of credit in an aggregate amount of $10,000. No such letters are drawn as of December 31, 2013.

Under the terms of the credit facility, the Company must maintain certain financial ratios including a ratio of debt to EBITDA of no more than 4.0 to 1.0 and an EBITDA to fixed charges ratio of no less than 1.25 to 1.0. At December 31, 2013, the Company was in compliance with these debt covenants.

Future scheduled maturities of debt existing at December 31, 2013 are as follows:

					
2014	 	$	10,000		
2015	 	10,000		
2016	 	35,000		
 	 	$	55,000		
On October 22, 2013, Costar Permian LLC entered into a Security Agreement which issued a $3,450 standby letter of credit in relation to the construction of certain midstream natural gas assets in the Permian Basin.

7.	Commitments and Contingencies	

On October 2, 2013, the Company entered into a Gas Processing and Gathering Agreement with an independent oil and natural gas producer. This contract specifies that Costar Permian LLC must commence to take delivery and process certain minimum amounts of product by July 1, 2014. This contract requires the construction of certain midstream assets and contains a maximum liquidated damages penalty of $2,800 if Costar does not meet this obligation.

The Company’s lease office space for various periods and determined that these leases are operating leases. The future minimum lease payment for operating leases under non-cancelable lease was $39 as of December 31, 2013.

8.	Concentration of Credit Risk	

During 2013, the Company derived 97% of its revenues from seven customers. The major customers had accounts receivable balances totaling $13,190 at December 31, 2013. During 2012, the Company derived 86% of its revenues from six customers. The major customers had accounts receivable balances totaling $11,700 at December 31, 2012.

9.	Subsequent Events	

Subsequent events were assessed through February 19, 2014, the date this report was available for issuance.

14

Exhibit 99.6

Introduction to the Unaudited Pro Forma
Condensed Consolidated Financial Statements of American Midstream Partners, LP

References to we, us or our refer to American Midstream Partners, LP and its consolidated subsidiaries (the “Partnership”). On October 13, 2014, the Partnership acquired Costar Midstream LLC (“Costar”, “Seller”) from Energy Spectrum Partners VI LP and Costar management for a total purchase price of $471.5 million. Costar is an onshore gathering and processing company with its primary gathering, processing, fractionation, and off-spec condensate treating and stabilization assets in East Texas and the prolific Permian basin, with a significant crude oil gathering system project underway in the Bakken oil play. The acquisition was funded with 6.9 million American Midstream common units issued directly to Energy Spectrum and Costar senior management, valued at $199.9 million in the purchase and sale agreement, which are subject to customary lock-up provisions, and $271.6 million of cash from borrowings under the Partnership’s revolving credit facility, subject to purchase price adjustments. The acquisition closed October 13, 2014.

Costar’s operating assets include the Longview gas gathering, processing, and fractionation complex and the Chapel Hill gas gathering, processing, and fractionation system, both located in East Texas. In addition, Costar operates the Yellow Rose gas gathering and processing system located in the Permian basin. Costar is also in the process of constructing an oil gathering system in the Bakken as well as a rail terminal in East Texas, and an off-spec condensate blending facility in the Permian.

The unaudited pro forma condensed consolidated financial statements present the impact of the Costar acquisition (“the transaction”) on our results of operations and financial position.

The unaudited pro forma condensed consolidated balance sheet as of September 30, 2014 is based upon the historical consolidated financial statements of the Partnership and the historical consolidated financial statements of Costar. The unaudited pro forma condensed consolidated statements of operations for the nine months ended September 30, 2014, as well as the unaudited pro forma condensed consolidated statements of operations for the year ended December 31, 2013, are based upon the historical consolidated financial statements of the Partnership and Costar.

The unaudited pro forma condensed consolidated balance sheet as of September 30, 2014 has been prepared as if the Costar acquisition had occurred on that date. The unaudited pro forma condensed consolidated statements of operations for the nine months ended September 30, 2014 and year ended December 31, 2013 have been prepared as if the Costar acquisition had occurred on January 1, 2013. The unaudited pro forma condensed consolidated statements of operations have been prepared based on the assumption that the Partnership will continue to be treated as a partnership for U.S. federal and state income tax purposes and therefore will not be subject to U.S. federal income taxes or state income taxes; with the exception of Texas franchise tax and the Partnership's subsidiary Blackwater Midstream Corporation. The unaudited pro forma condensed consolidated statement of operations have also been prepared based on certain pro forma adjustments, as described in Note 2 - Pro Forma Adjustments.

The following unaudited pro forma condensed consolidated statement of operations are qualified in their entirety by reference to and should be read in conjunction with such historical financial statements and related notes contained in those reports: (i) the Partnership's unaudited historical condensed consolidated financial statements set forth in its Quarterly Report on Form 10-Q and related Form 10-Q/A as of and for the three and nine months ended September 30, 2014, as filed with the Securities and Exchange Commission (“SEC”); (ii) the Partnership's audited historical consolidated financial statements set forth in its Annual Report on Form 10-K and related Form 10-K/A as of and for the year ended December 31, 2013 as filed with the SEC; and (iii) Costar's audited historical financial statements set forth in Exhibit 99.5 and unaudited interim historical financial statements set forth Exhibit 99.4 of this Current Report on Form 8-K/A.

The pro forma adjustments reflected in the unaudited pro forma condensed consolidated statement of operations are based upon currently available information and certain assumptions and estimates; therefore, the actual effects of these transactions will differ from the pro forma adjustments. However, the Partnership's management considers the applied estimates and assumptions to provide a reasonable basis for the presentation of the significant effects of certain transactions that are expected to have a continuing impact on the Partnership. In addition, the Partnership's management considers the pro forma adjustments to be factually supportable and to appropriately represent the expected impact of items that are directly attributable to the acquisition of Costar by the Partnership.

The unaudited pro forma condensed consolidated statement of operations may not be indicative of the results that would have occurred if the Partnership had acquired Costar on the dates indicated nor are they indicative of the future operating results of the Partnership.

AMERICAN MIDSTREAM PARTNERS, LP
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF SEPTEMBER 30, 2014
(unaudited, in thousands)

																		
 	 	 	Partnership Historical	 	Costar Historical	 	Pro Forma Adjustments	 	Partnership Pro Forma	
Assets	 	 	 	 	 	 			
 	Current assets	 	 	 	 	 	 			
 	 	Cash and cash equivalents	$	459		 	$	10,023		 	$	265,375		a	$	10,482		
 	 	 	 	 	 	 	(265,375	)	a	 	
 	 	Accounts receivable	7,430		 	11,497		 	—		 	18,927		
 	 	Unbilled revenue	21,271		 	—		 	—		 	21,271		
 	 	Risk management assets	1,047		 	37		 	(37	)	c	1,047		
 	 	Other current assets	4,715		 	323		 	—		 	5,038		
 	 	Current assets held for sale	29		 	604		 	—		 	633		
 	 	Total current assets	34,951		 	22,484		 	(37	)	 	57,398		
 	Property, plant and equipment, net	415,799		 	201,892		 	263,379		a	886,723		
 	 	 	 	 	 	5,653		b	 	
 	Risk management assets - long term	—		 	61		 	(61	)	c	—		
 	Note receivable from managing member	—		 	3,564		 	(3,564	)	d	—		
 	Goodwill	16,253		 	—		 	—		 	16,253		
 	Intangible assets, net	45,585		 	187		 	—		 	45,772		
 	Investment in unconsolidated affiliate	11,017		 	—		 	—		 	11,017		
 	Other assets, net	11,195		 	455		 	(387	)	e	11,263		
 	Non current assets held for sale, net	1,164		 	—		 	—		 	1,164		
 	 	Total assets	$	535,964		 	$	228,643		 	$	264,983		 	$	1,029,590		
Liabilities and Partners' Capital	 	 	 	 	 	 	 	
 	Current liabilities	 	 	 	 	 	 	 	
 	 	Accounts payable	$	12,426		 	$	17,380		 	$	—		 	$	29,806		
 	 	Accrued gas purchases	14,762		 	—		 	—		 	14,762		
 	 	Accrued expenses and other current liabilities	21,425		 	1,405		 	—		 	22,830		
 	 	Current portion of long-term debt	1		 	10,000		 	(10,000	)	f	1		
 	 	Risk management liabilities	335		 	234		 	(234	)	c	335		
 	 	Current liabilities held for sale	1		 	128		 	—		 	129		
 	 	Total current liabilities	48,950		 	29,147		 	(10,234	)	 	67,863		
 	 	Risk management liabilities - long term	—		 	12		 	(12	)	c	—		
 	 	Asset retirement obligations	34,782		 	—		 	—		 	34,782		
 	 	Other liabilities	161		 	—		 	—		 	161		
 	 	Long-term debt	57,700		 	48,500		 	265,375		a	323,075		
 	 	 	 	 	 	 	(48,500	)	f	 	
 	 	Contingent consideration payable	—		 	9,174		 	—		 	9,174		
 	 	Deferred tax liability	4,816		 	269		 	—		 	5,085		
 	 	Total liabilities	146,409		 	87,102		 	206,629		 	440,140		

2

	
																		
 	Commitments and contingencies	 	 	 	 	 	 	 	
 	Convertible preferred units	 	 	 	 	 	 	 	
 	 	Series A convertible preferred units (5,586 thousand and 5,279 thousand units issued and outstanding as of September 30, 2014, and December 31, 2013, respectively)	104,736		 	—		 	—		 	104,736		
 	Partners’ capital	 	 	 	 	 	 	 	
 	 	General partner interest (299 thousand and 185 thousand units issued and outstanding as of September 30, 2014, and December 31, 2013, respectively)	(3,106	)	 	—		 	—		 	(3,106	)	
 	 	Limited partner interest (15,771 thousand and 7,414 thousand units issued and outstanding as of September 30, 2014, and December 31, 2013, respectively)	251,564		 	—		 	199,895		a	451,459		
 	 	Series B convertible units (1,232 thousand and zero units issued and outstanding as of September 30, 2014, and December 31, 2013, respectively)	31,671		 	—		 	—		 	31,671		
 	 	Accumulated other comprehensive income	157		 	—		 	—		 	157		
 	 	Total partners’ capital	280,286		 	—		 	199,895		 	480,181		
 	 	Noncontrolling interest	4,533		 	—		 	—		 	4,533		
 	 	Member's equity	—		 	$	141,541		 	(141,541	)	g	—		
 	 	Total equity and partners' capital	284,819		 	141,541		 	58,354		 	$	484,714		
 	 	Total liabilities and partners' capital	$	535,964		 	$	228,643		 	$	264,983		 	$	1,029,590		

See accompanying notes to unaudited pro forma condensed consolidated financial statement.

3

AMERICAN MIDSTREAM PARTNERS, LP
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 2014
(unaudited, in thousands except earnings per unit)

																
 	Partnership Historical	 	Costar Historical	 	Pro Forma Adjustments	 	Partnership Pro Forma	
Revenue	$	227,940		 	$	123,018		 	$	—		 	$	350,958		
Gain (loss) on derivatives	283		 	459		 	(459	)	h	283		
Total revenue	228,223		 	123,477		 	(459	)	 	351,241		
Operating expenses:	 	 	 	 	 	 	 	
Purchases of natural gas, NGLs and condensate	155,729		 	87,430		 	—		 	243,159		
Direct operating expenses	31,889		 	10,451		 	—		 	42,340		
Selling, general and administrative expenses	17,105		 	2,457		 	(285	)	i	19,277		
Equity compensation expense	1,132		 	—		 	—		 	1,132		
Depreciation, amortization and accretion expense	19,350		 	15,043		 	8,071		j	42,464		
Total operating expenses	225,205		 	115,381		 	7,786		 	348,372		
 	 	 	 	 	 	 	 	
Gain (loss) on sale of assets, net	(124	)	 	21		 	—		 	(103	)	
Operating income (loss)	2,894		 	8,117		 	(8,245	)	 	2,766		
Other income (expenses)	 	 	 	 	 	 	 	
Interest expense	(5,013	)	 	(1,389	)	 	1,389		k	(13,731	)	
 	 	 	 	 	(8,718	)	l	 	
Other income (expense)	(672	)	 	—		 	—		 	(672	)	
Interest income from managing member	—		 	103		 	(103	)	m	—		
Unrealized loss on contingent consideration	—		 	(4,627	)	 	—		 	(4,627	)	
Earnings in unconsolidated affiliate	117		 	—		 	—		 	117		
Net income (loss) before income tax benefit	(2,674	)	 	2,204		 	(15,677	)	 	(16,147	)	
Income tax expense	(260	)	 	(31	)	 	—		 	(291	)	
Income (loss) from continuing operations	(2,934	)	 	2,173		 	(15,677	)	 	(16,438	)	
Discontinued operations:	 	 	 	 	 	 	 	
(Loss) gain from operations of discontinued asset groups	(582	)	 	(91	)	 	—		 	(673	)	
Net income (loss)	(3,516	)	 	2,082		 	(15,677	)	 	(17,111	)	
Net income (loss) attributable to non-controlling interests	207		 	—		 	—		 	207		
Net income (loss) attributable to the Partnership	$	(3,723	)	 	$	2,082		 	$	(15,677	)	 	$	(17,318	)	
 	 	 	 	 	 	 	 	
General partners' interest in net loss	$	(48	)	 	 	 	 	 	$	(223	)	
Limited partners’ interest in net loss	$	(3,675	)	 	 	 	 	 	$	(17,095	)	
 	 	 	 	 	 	 	 	
Limited Partners net loss from continuing operations per common unit (basic and diluted):	$	(1.52	)	 	 	 	 	n	$	(1.68	)	
Weighted average number of units outstanding:	 	 	 	 	 	 	 	
Basic and diluted	11,409		 	 	 	 	n	18,302		
See accompanying notes to unaudited pro forma condensed consolidated financial statement.

4

AMERICAN MIDSTREAM PARTNERS, LP
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2013
(unaudited, in thousands except earnings per unit)

																
 	Partnership Historical	 	Costar Historical	 	Pro Forma Adjustments	 	Partnership Pro Forma	
Revenue	$	292,626		 	$	155,772		 	$	—		 	$	448,398		
Gain (loss) on commodity derivatives	28		 	(179	)	 	179		h	28		
Total revenue	292,654		 	155,593		 	179		 	448,426		
Operating expenses:	 	 	 	 	 	 	 	
Purchases of natural gas, NGLs and condensate	214,149		 	107,595		 	—		 	321,744		
Direct operating expenses	29,553		 	13,094		 	—		 	42,647		
Selling, general and administrative expenses	21,402		 	2,846		 	—		 	24,248		
Equity compensation expense	2,094		 	—		 	—		 	2,094		
Depreciation, amortization and accretion expense	29,999		 	18,897		 	10,761		j	59,657		
Total operating expenses	297,197		 	142,432		 	10,761		 	450,390		
 	 	 	 	 	 	 	 	
Gain on involuntary conversion of property, plant and equipment	343		 	—		 	—		 	343		
Loss on impairment of property, plant and equipment	(18,155	)	 	—		 	—		 	(18,155	)	
Operating income (loss)	(22,355	)	 	13,161		 	(10,582	)	 	(19,776	)	
Other expense:	 	 	 	 	 	 	 	
Interest expense	(9,291	)	 	(1,902	)	 	1,902		k	(21,312	)	
 	 	 	 	 	(12,021	)	l	 	
Gain on sale of assets	—		 	33		 	—		 	33		
Interest income from managing member	—		 	24		 	(24	)	m	—		
Net income (loss) before taxes	(31,646	)	 	11,316		 	(20,725	)	 	(41,055	)	
Income tax benefit (expense)	495		 	(310	)	 	—		 	185		
Net income (loss) from continuing operations	(31,151	)	 	11,006		 	(20,725	)	 	(40,870	)	
Discontinued operations	 	 	 	 	 	 			
Loss from operations of disposal groups, net of tax	(2,255	)	 	(345	)	 	—		 	(2,600	)	
Net income (loss)	(33,406	)	 	10,661		 	(20,725	)	 	(43,470	)	
Net income attributable to noncontrolling interests	633		 	—		 	—		 	633		
Net income (loss) attributable to the Partnership	$	(34,039	)	 	$	10,661		 	$	(20,725	)	 	$	(44,103	)	
 			 	 	 	 	 			
General partner's interest in net loss	$	(1,405	)	 	 	 	 	 	$	(1,820	)	
Limited partner's interest in net loss	$	(32,634	)	 	 	 	 	 	$	(42,283	)	
 	 	 	 	 	 	 	 	
Limited partner's net loss from continuing operations per common unit (basic and diluted):	$	(7.17	)	 	 	 	 	n	$	(4.41	)	
Weighted average number of common units outstanding:	 	 	 	 	 	 	 	
Basic and diluted	7,525		 	 	 	 	n	14,418		

See accompanying notes to unaudited pro forma condensed consolidated financial statement.

5

Notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements of
American Midstream Partners, LP
1. Basis of presentation
The unaudited pro forma condensed consolidated financial statements are based upon the historical consolidated financial statements of the Partnership and the historical financial statements of Costar.
The Partnership has utilized Costar's audited historical consolidated financial statements for the year ended December 31, 2013, as well as the historical interim consolidated nine months ended September 30, 2014.
The unaudited pro forma condensed consolidated financial statements present the impact of the acquisition of Costar, which was described in the introduction to the unaudited pro forma condensed consolidated financial statements, on the Partnership's results of operations and financial position. The acquisition of Costar is being treated as a business combination for GAAP purposes.
2. Pro forma adjustments
The following adjustments for the Partnership have been prepared (i) as if the transaction occurred on September 30, 2014 in the case of the unaudited pro forma condensed consolidated balance sheet as of September 30, 2014; (ii) as if the transaction occurred on January 1, 2013 in the case of the unaudited pro forma condensed consolidated statement of operations for the nine months ended September 30, 2014 and the year ended December 31, 2013:
		
a.	The acquisition of Costar for a preliminary fair value of $465.3 million, which includes a preliminary downward working capital adjustment of $6.2 million, was funded by $265.4 million in cash, which was drawn from the Partnership's credit facility and 6,892,931 units issued directly to Energy Spectrum and Costar senior management valued at $199.9 million on the date of the transaction. The purchase price allocation of the transaction is preliminary pending final settlement and completion of valuation.	
		
b.	Represents the fair value of cash consideration in excess of the Costar net assets received by the Partnership. The Partnership has preliminarily assigned the value to property, plant and equipment pending the final valuation of the transaction.	
		
c.	The elimination of Costar's commodity and interest rate derivatives settled by Seller prior to the close of the transaction.	
		
d.	The elimination of Costar's note receivable from managing member settled by Seller prior to the close of the transaction.	
		
e.	The elimination of Costar capitalized debt issuance costs associated with debt settled by Seller prior to the close of the transaction.	
		
f.	The elimination of Costar's debt settled by Seller prior to the close of the transaction.	
		
g.	The elimination of the Costar members' capital, including the effect of adjustments a,b,c,d,e, and f above.	
		
h.	The elimination of realized and unrealized gain (loss) on Costar's commodity and interest rate derivatives settled by Seller prior to the close of the transaction.	
		
i.	The elimination of transaction costs included in the historical financial statements of the Partnership that were directly related to the acquisition of Costar.	
		
j.	The additional depreciation expense recorded related to the adjustments made to property, plant and equipment in adjustment a and b above calculated using the straight line method over 25 years, the Partnership's preliminary useful life for the Costar assets acquired.	
		
k.	The elimination of interest expense and amortization of deferred financing costs related to the Costar debt settled by Seller prior to the close of the transaction.	
		
l.	The inclusion of interest expense on the Partnership's assumed borrowings of approximately $265.4 million under its revolving credit facility, which had a weighted average borrowing rate of 4.38% and 4.53%, for the nine months ended September 30, 2014 and the year ended December 31, 2013, respectively.  A 1/8 percentage change in the assumed interest rate would result in an adjustment of interest expense of $0.2 million for the nine months ended September 30, 2014 and $0.3 million for the year ended December 31, 2013.	
		
m.	The elimination of Costar's interest income in the note receivable from managing member settled by Seller prior to the close of the transaction.	
		
n.	The weighted average number of units used in computation of limited partners’ net loss per unit (basic and diluted) on a pro forma basis have been adjusted to reflect the issuance of approximately 6.9 million common units.	
3. Pro forma net income (loss) per limited common and general partner unit

6

Net income (loss) is allocated to the General Partner and the limited partners in accordance with their respective ownership percentages, after giving effect to contractual distributions on Series A preferred convertible units, declared distributions on the Series B Units, limited partner and to the general partner units, including incentive distribution rights. Basic and diluted net income (loss) per limited partner unit is calculated by dividing limited partners’ interest in net income (loss) by the weighted average number of outstanding limited partner units during the period.

We compute earnings per unit using the two-class method. The two-class method requires that securities that meet the definition of a participating security be considered for inclusion in the computation of basic earnings per unit. Under the two-class method, earnings per unit is calculated as if all of the earnings for the period were distributed under the terms of the partnership agreement, regardless of whether the General Partner has discretion over the amount of distributions to be made in any particular period, whether those earnings would actually be distributed during a particular period from an economic or practical perspective, or whether the General Partner has other legal or contractual limitations on its ability to pay distributions that would prevent it from distributing all of the earnings for a particular period.

The two-class method does not impact our overall net income (loss) or other financial results; however, in periods in which aggregate net income exceeds our aggregate distributions for such period, it will have the impact of reducing net income (loss) per limited partner unit. This result occurs as a larger portion of our aggregate earnings, as if distributed, is allocated to the incentive distribution rights of the General Partner, even though we make distributions on the basis of available cash and not earnings. In periods in which our aggregate net income does not exceed our aggregate distributions for such period, the two-class method does not have any impact on our calculation of earnings per limited partner unit. We have no dilutive securities, therefore basic and diluted net income per unit are the same.

7