##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM 10-K
 (Mark One)
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2006
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to.
 Commission File No. 333-75818
 Hanover Equipment Trust 2001B
 (Exact name of registrant as specified in its charter)
 Delaware
(State or Other Jurisdiction of 
Incorporation or Organization)
    
    51-6523442
(I.R.S. Employer
Identification No.)c/o Wilmington Trust Company 
Rodney Square North 
1100 North Market Street 
Wilmington, Delaware
(Address of Principal Executive Offices)
    
    19890
(Zip Code)
 (302) 651-1000
(Registrants telephone number, including area code)
 
 
 o þ
 o þ
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TABLE OF CONTENTS
 PagePART IItem 1. Business
    
    
    4Item 1A. Risk Factors
    
    
    8Item 1B. Unresolved Staff Comments
    
    
    10Item 2. Properties
    
    
    10Item 3. Legal Proceedings
    
    
    10Item 4. Submission of Matters to a Vote of Security Holders
    
    
    10PART IIItem 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    10Item 6. Selected Financial Data
    
    
    11Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operation
    
    
    12Item 7A. Quantitative and Qualitative Disclosures about Market Risk
    
    
    15Item 8. Financial Statements and Supplementary Data
    
    
    15Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    15Item 9A. Controls and Procedures
    
    
    15Item 9B. Other Information
    
    
    15PART IIIItem 10. Directors and Executive Officers of Hanover Equipment Trust 2001B
    
    
    16Item 11. Executive Compensation
    
    
    16Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    16Item 13. Certain Relationships and Related Transactions
    
    
    16Item 14. Principal Accountant Fees and Services
    
    
    16PART IVItem 15. Exhibits and Financial Statement Schedules
    
    
    16SIGNATURES
    
    
    18Report of Independent Registered Public Accounting Firm
    
    
    F-1BALANCE SHEETS
    
    
    F-2STATEMENTS OF OPERATIONS
    
    
    F-3STATEMENTS OF CASH FLOWS
    
    
    F-4STATEMENTS OF CERTIFICATE HOLDERS EQUITY
    
    
    F-5NOTES TO FINANCIAL STATEMENTS
    
    
    F-6EXHIBIT INDEXCertification Pursuant to Rule 13a-14(a)/15d-14(a)Certification Pursuant to Section 906Risk Factors
  2




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PART I
 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
  
    
    Hanover and HCLP operate in a highly competitive industry that includes competition among
the various providers of contract compression services;
    
    reduced profit margins or the loss of market share resulting from competition, including
pricing pressure in Hanovers and HCLPs businesses;
    
    the introduction of competing technologies by Hanover and HCLPs competitors;
    
    a prolonged substantial reduction in oil and natural gas prices, which would cause a
decline in the demand for HCLPs compression and oil and natural gas production equipment;
    
    governmental safety, health and environmental regulations which could require Hanover and
HCLP to make significant expenditures;
    
    currency fluctuations (in countries including but not limited to Italy, Argentina and Venezuela) and changes in interest rates;
    
    adverse results in litigation or regulatory proceedings to which Hanover and/or HCLP is a party;
    
    inability of Hanover or HCLP to comply with the financial and other covenants in or
defaults under, their debt agreements and the agreements related to their compression
equipment lease obligations which if not cured or waived could have a material adverse effect
on Hanover and/or HCLP and the decreased financial flexibility associated with Hanovers and
HCLPs substantial debt;
    
    Hanovers and/or HCLPs inability to implement certain business objectives including
international expansion;
    
    Hanovers and/or HCLPs inability to timely and cost-effectively execute projects in
international operating environments, which includes certain inherent risks in their
international business activities including the following:
 
    
    unexpected changes in regulatory requirements;
    
    tariffs and other trade barriers that may restrict their ability to enter into new markets;
    
    governmental actions that result in the deprivation of contract rights;
    
    changes in political and economic conditions in the countries in which they operate,
including civil uprisings, riots, kidnappings and terrorist acts, particularly with
respect to their operations in Nigeria;
 3




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
    
    potentially adverse tax consequences;
    
    restrictions on repatriation of earnings or expropriation of property without fair compensation;
    
    difficulties in establishing new international offices and risks inherent in
establishing new relationships in foreign countries; and
    
    the burden of complying with the various laws and regulations in the countries in which they operate.
 
    
    Hanovers and/or HCLPs ability to manage business effectively will be weakened if key personnel are lost;
    
    liability for acquired facilities in the past which could subject Hanover and/or HCLP to future environmental liabilities;
    
    Hanovers or HCLPs inability to generate the substantial amount of capital needed to
expand their compressor rental fleet and their complimentary businesses;
    
    Hanover and HCLP have a substantial amount of debt, including under their compression
equipment lease obligations, that could limit their ability to fund future growth and
operations and increase their exposure during adverse economic conditions and as a result of
having a significant amount of leverage as compared to their total capitalization which could
result in a change made in their credit rating or other adverse consequences if Hanover and
HCLP do not decrease their leverage;
    
    Hanovers or HCLPs inability to renew its short-term leases of equipment with its
customers so as to fully recoup the cost of the equipment;
    
    Hanover or HCLPs inability to generate the significant amount of cash needed to service
their debt, to fund working capital and to pay their debts when they become due;
    
    Hanovers or HCLPs future ability to refinance existing or incur additional indebtedness
to fund Hanovers and HCLPs businesses;
    
    losses incurred by Hanover and HCLP due to inherent risks associated with their natural gas
operations, including equipment defects, malfunctions and failures and natural disasters;
    
    war, social unrest, terrorist attacks, and/or the responses thereto;
    
    Hanovers and/or HCLPs inability to successfully integrate acquired businesses;
    
    risks associated with any significant failure or malfunction of Hanover and HCLPs enterprise resource planning system;
    
    Hanovers and/or HCLPs inability to reduce debt relative to their total capitalization;
    
    changes in federal bankruptcy or tax laws, comparable state laws or accounting principles.
    
    Hanovers inability to consummate the proposed merger
with Universal Compression Holdings, Inc.
  
 Item 1. Business
  4




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
    
    issuing the old notes and the new notes;
    
    issuing the equity certificates to the equity certificate holder;
    
    investing the gross proceeds of the old notes and the equity certificates in the leased equipment;
 5




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
    
    entering into the Lease, a participation agreement and other ancillary agreements relating
to the financing of the leased equipment (collectively, the Operative Agreements);
    
    distributing payments received under the Lease to the holders of the old notes or the new
notes, as the case may be, and the equity certificates; and
    
    engaging in only those other activities necessary or incidental to such purposes.
   Financing
   Obligation
    
    Amount Due
    
    Date Due8.75% Senior Secured Notes due 2011
    
    $10,937,500
    
    Each March 1 and September 1 to maturityEquity Certificate
    
    Accrued return on
approximately $7.8
million, based on the
floating certificate
holder yield rate of the
Eurodollar rate or the
prime rate, plus a spread
in each case of 8.375% (1)
    
    March 1, June 1, September 1 and December 1 to
maturity
 
 (1)
    
    As of December 31, 2006, based upon the certificate holder yield rate of 13.7%, the Trust
would make payments to the equity certificate holder of approximately $266,000 per quarter. 6




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Industry
 Natural Gas Compression Overview
       
    
    engineering, fabrication and assembly of the compressor package;
    
    installation and testing of the package;
    
    ongoing performance review to assess the need for a change in compression; and
    
    periodic maintenance and replacement parts supply.
 Our Equipment
  Customers
  Environmental and Other Regulations
  7




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Employees and Labor Relations
  Available Information
 http://www.sec.gov .
 
 Item 1A. Risk Factors
 The assets and source of revenue available to repay the Notes, satisfy the claims of holders of the
Notes and provide a yield to the equity certificate holder are limited, as we have no assets other
than our interests in the equipment, and no source of revenue other than the payments under the
Lease and the Hanover guarantee.
   Obligations under the Hanover guarantee are subordinated to Hanovers and HCLPs senior
indebtedness as well as all indebtedness and other liabilities of Hanovers and HCLPs
subsidiaries.
     8




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Hanovers proposed merger with Universal is subject to the receipt of consents
and approvals from various government entities that may impose conditions on,
jeopardize or delay completion of the merger or reduce the anticipated benefits
of the merger.
   While the merger is pending, Hanover will be subject to business
uncertainties and contractual restrictions that could adversely
affect Hanovers business.
  Failure to complete the merger could negatively impact Hanovers
stock price and Hanovers future business and financial results
because of, among other things, the disruption that would occur
as a result of uncertainties relating to a failure to complete
the merger.
   If at the end of the Lease term, HCLP fails to purchase the equipment, then HCLP is required to pay
an amount equal to the final rent payment with respect to the Lease plus the proceeds, if any, from
the sale of the equipment. This amount may be less than the amount due on the Notes.
  The value of the equipment securing the Notes may not be sufficient to cover the obligations owed
to holders of the Notes under the Notes.
   There are some limitations on the right to amend the participation agreement and the other
operative agreements and to accelerate payments under the Lease and to foreclose on the equipment.
   9




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If HCLP declares bankruptcy, our rights against HCLP and Hanover may be limited.
  In addition to the risks discussed above with respect to bankruptcy of HCLP, if we declare
bankruptcy, your rights against us may be limited.
  Other creditors may have prior liens on the collateral that could reduce or eliminate the amount of
collateral securing the Notes.
   
 Item 1B. Unresolved Staff Comments
  
 Item 2. Properties
  
 Item 3. Legal Proceedings
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 PART II
 
 Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities
  10




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Item 6. Selected Financial Data
 SELECTED HISTORICAL FINANCIAL DATA OF HANOVER EQUIPMENT TRUST 2001B
   Year Ended December 31,2006
    
    
    2005
    
    
    2004
    
    
    2003
    
    
    2002(in thousands)Rental revenue
    
    $
    23,013
    
    
    $
    22,888
    
    
    $
    22,766
    
    
    $
    23,226
    
    
    $
    25,603Interest expense on rental equipment
    
    
    21,875
    
    
    
    21,875
    
    
    
    21,875
    
    
    
    22,307
    
    
    
    24,186Excess rental revenue over
interest expense on rental
equipment
    
    
    1,138
    
    
    
    1,013
    
    
    
    891
    
    
    
    919
    
    
    
    1,417Operating expense
    
    
    83
    
    
    
    96
    
    
    
    119
    
    
    
    165
    
    
    
    623Net income
    
    $
    1,055
    
    
    $
    917
    
    
    $
    772
    
    
    $
    754
    
    
    $
    794Balance Sheet Data (End of Period):Rental equipment
    
    $
    257,750
    
    
    $
    257,750
    
    
    $
    257,750
    
    
    $
    257,750
    
    
    $
    257,750Total assets
    
    
    265,188
    
    
    
    265,187
    
    
    
    265,171
    
    
    
    265,147
    
    
    
    266,3468.50% senior secured notes due 2008
    
    
    250,000
    
    
    
    250,000
    
    
    
    250,000
    
    
    
    250,000
    
    
    
    250,000Certificate holders equity
    
    
    7,750
    
    
    
    7,750
    
    
    
    7,750
    
    
    
    7,750
    
    
    
    7,750
 11




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operation
 General
    Critical Accounting Policies and Estimates
  Revenue Recognition
  Concentrations of Credit Risk
  Rental Equipment
  Long-Lived Assets
  12




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RESULTS OF OPERATIONS
 YEAR ENDED DECEMBER 31, 2006 COMPARED TO YEAR ENDED DECEMBER 31, 2005
 Revenues
   Expenses
  YEAR ENDED DECEMBER 31, 2005 COMPARED TO YEAR ENDED DECEMBER 31, 2004
 Revenues
    Expenses
  LIQUIDITY AND CAPITAL RESOURCES
  13




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Redemption PriceAfter Sept 1, 2006
    
    
    104.375
    %After Sept 1, 2007
    
    
    102.917
    %After Sept 1, 2008
    
    
    101.458
    %After Sept 1, 2009
    
    
    100.000
    %
  Cash Contractual Obligations:
    
    Total
    
    
    2007
    
    
    2008-2009
    
    
    2010-2011
    
    
    Thereafter(In thousands)2001B equipment lease notes, due 2011
    
    $
    250,000
    
    
    $
    
    
    
    $
    
    
    
    $
    250,000
    
    
    $
    Interest on long-term debt
    
    
    107,051
    
    
    
    22,939
    
    
    
    45,879
    
    
    
    38,233
    
    
    
    Total contractual cash obligations
    
    $
    357,051
    
    
    $
    22,939
    
    
    $
    45,879
    
    
    $
    288,233
    
    
    $
    
 RECENT ACCOUNTING PRONOUNCEMENTS
   14




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SEASONAL FLUCTUATIONS
  
 Item 7A. Quantitative and Qualitative Disclosures about Market Risk
  
 Item 8. Financial Statements and Supplementary Data
   
    
    Report of Independent Registered Public Accounting Firm
    
    
    F-
    1
    
    Balance Sheets
    
    
    F-
    2
    
    Statements of Operations
    
    
    F-
    3
    
    Statements of Cash Flows
    
    
    F-
    4
    
    Statements of Certificate Holders Equity
    
    
    F-
    5
    
    Notes to Financial Statements
    
    
    F-
    6
   
 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
  
 Item 9A. Controls and Procedures
  
 Item 9B. Other Information
  15




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PART III
 
 Item 10. Directors and Executive Officers of Hanover Equipment Trust 2001B
  
 Item 11. Executive Compensation
  
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
   
 Item 13. Certain Relationships and Related Transactions
  
 Item 14. Principal Accountant Fees and Services
  Type of Fees
    
    2006
    
    
    2005(dollars in thousands)Audit Fees
    
    $
    30
    
    
    $
    29Audit-Related Services
    
    
    
    
    
    
    Tax Fees
    
    
    
    
    
    
    All Other Fees
    
    
    
    
    
    
    Total
    
    $
    30
    
    
    $
    29
  
 PART IV
 
 Item 15. Exhibits and Financial Statement Schedules
   
    
    Report of Independent Registered Public Accounting Firm
    
    
    F-1
    
    Balance Sheets
    
    
    F-2
    
    Statements of Operations
    
    
    F-3
    
    Statements of Cash Flows
    
    
    F-4
    
    Statements of Certificate Holders Equity
    
    
    F-5
    
    Notes to Financial Statements
    
    
    F-6
  16




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ExhibitNumber
    
    Description3.1
    
    Certificate of Trust of Hanover Equipment Trust 2001B (incorporated by reference to Exhibit 3.1 to the
Trusts Form S-4, filed with the Commission on December 21, 2001).3.2
    
    Amended and Restated Trust Agreement of Hanover Equipment Trust 2001B, dated as of August 30, 2001,
between General Electric Capital Corporation, as Certificate Holder, and Wilmington Trust Company, as
Trustee (incorporated by reference to Exhibit 3.2 to Form S-4 filed with the Commission on December 21,
2001).4.1
    
    Indenture, dated as of August 30, 2001, between Hanover Equipment Trust 2001B, the Hanover Guarantors
parties thereto, and Wilmington Trust FSB, as Trustee and Collateral Agent, with respect to the 8.75%
Senior Secured Notes due 2011 (incorporated by reference to Exhibit 10.69 to Quarterly Report of
Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15, 2001).4.2
    
    Exchange and Registration Rights Agreement with respect to the 8.75% Senior Secured Notes due 2011,
dated as of August 30, 2001, among Hanover Equipment Trust 2001B, Hanover Compressor Company, certain
Guarantors party thereto, Goldman, Sachs & Co., J.P. Morgan Securities Inc., Salomon Smith Barney, Inc.
and Credit Suisse First Boston Corporation (incorporated by reference to Exhibit 4.2 to the Trusts Form S-4 filed with the Commission on December 21, 2001).4.3
    
    Participation Agreement, dated as of August 31, 2001, among Hanover Compression Limited Partnership, as
Lessee, Hanover Equipment Trust 2001B, as Lessor, General Electric Capital Corporation, as Certificate
Holders, certain Guarantors party thereto, Wilmington Trust FSB, as Indenture Trustee, Collateral Agent
under the Indenture, and in its individual capacity, only to the extent expressly set forth therein,
and Wilmington Trust Company, in its individual capacity, only to the extent expressly set forth
therein (incorporated by reference to Exhibit 10.66 to Quarterly Report of Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15, 2001).4.4
    
    Annex A to Participation Agreement and other Operative Agreements, containing certain Rules of Usage
and Definitions (incorporated by reference to Exhibit 4.4 to the Trusts Form S-4 filed with the
Commission on December 21, 2001).4.5
    
    Lease, dated as of August 31, 2001, between Hanover Equipment Trust 2001B, as Lessor, and Hanover
Compression Limited Partnership, as Lessee (incorporated by reference to Exhibit 10.64 to Quarterly
Report of Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15, 2001).4.6
    
    Guarantee, dated as of August 31, 2001, made by Hanover Compression Limited Partnership, Hanover
Compressor Company, certain Guarantors party thereto, and certain Beneficiaries party thereto
(incorporated by reference to Exhibit 10.65 to Quarterly Report of Hanover Compressor Company on Form
10-Q, filed with the Commission on November 15, 2001).4.7
    
    Security Agreement, dated as of August 31, 2001, made by Hanover Equipment Trust 2001B in favor of
Wilmington Trust FSB, as Collateral Agent (incorporated by reference to Exhibit 10.67 to Quarterly
Report of Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15, 2001).4.8
    
    Assignment of Lease, Rents and Guarantee, dated as of August 31, 2001, from Hanover Equipment Trust
2001B to Wilmington Trust FSB, as Collateral Agent (incorporated by reference to Exhibit 10.68 to
Quarterly Report of Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15,
2001).4.9
    
    Instrument of Resignation of Trustee, Appointment and Acceptance of Successor Trustee dated as of
September 29, 2004, incorporated by reference to Exhibit 4.9 to Hanover Equipment Trust 2001Bs Current
Report on Form 8-K filed with the SEC on October 4, 2004.31.1
    
    Certification pursuant to Rule 13a- 14(a)/ 15d-14(a) of the Securities Exchange Act of 1934.*32.1
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.**99.1
    
    Item 1A. Risk Factors from Hanover Compressor Companys Form 10-K for the year ended December 31, 2006.*
 
 *
    
    Filed herewith**
    
    Furnished herewith 17




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SIGNATURES
  Hanover Equipment Trust 2001BBy: Wilmington Trust Company, not in its individual
capacity but solely as Trustee for the Hanover Equipment Trust 2001BName:
    
    /s/ DAVID A. VANASKEY, JR.

David A. Vanaskey, Jr.Title:
    
    Vice PresidentDate:
March 27, 2007
  
  18




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Report of Independent Registered Public Accounting Firm
 
   
 F-1




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HANOVER EQUIPMENT TRUST 2001B
 
 BALANCE SHEETS
  December 31,
    
    
    December 31,2006
    
    
    2005ASSETSCurrent assets:Cash and cash equivalents
    
    $
    
    
    
    $
    Accounts receivablerents
    
    
    7,438
    
    
    
    7,437Total current assets
    
    
    7,438
    
    
    
    7,437Rental equipment
    
    
    257,750
    
    
    
    257,750Total assets
    
    $
    265,188
    
    
    $
    265,187LIABILITIES AND CERTIFICATE HOLDERS EQUITYCurrent liabilities:Accrued liabilities
    
    $
    54
    
    
    $
    60Interest payable
    
    
    7,292
    
    
    
    7,292Equity certificate yield payable
    
    
    92
    
    
    
    85Total current liabilities
    
    
    7,438
    
    
    
    7,437Notes payable
    
    
    250,000
    
    
    
    250,000Total liabilities
    
    
    257,438
    
    
    
    257,437Commitments and contingencies (Note 5)Certificate holders equity:Equity certificates
    
    
    7,750
    
    
    
    7,750Accumulated trust earnings
    
    
    
    
    
    
    Certificate holders equity
    
    
    7,750
    
    
    
    7,750Total liabilities and certificate holders equity
    
    $
    265,188
    
    
    $
    265,187
  F-2




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HANOVER EQUIPMENT TRUST 2001B
 
 STATEMENTS OF OPERATIONS
  Year Ended December 31,2006
    
    
    2005
    
    
    2004Rental revenue
    
    $
    23,013
    
    
    $
    22,888
    
    
    $
    22,766Interest expense on rental equipment
    
    
    21,875
    
    
    
    21,875
    
    
    
    21,875Excess rental revenue over interest expense on rental equipment
    
    
    1,138
    
    
    
    1,013
    
    
    
    891Operating expense
    
    
    83
    
    
    
    96
    
    
    
    119Net income
    
    $
    1,055
    
    
    $
    917
    
    
    $
    772
  F-3




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HANOVER EQUIPMENT TRUST 2001B
 
 STATEMENTS OF CASH FLOWS
  Year Ended December 31,2006
    
    
    2005
    
    
    2004Cash flows from operating activities:Net income
    
    $
    1,055
    
    
    $
    917
    
    
    $
    772Changes in assets and liabilitiesAccounts receivablerents
    
    
    (1
    )
    
    
    (16
    )
    
    
    (24
    )Interest payable
    
    
    
    
    
    
    
    
    
    
    1Accrued liabilities
    
    
    (6
    )
    
    
    2
    
    
    
    16Net cash provided by operating activities
    
    
    1,048
    
    
    
    903
    
    
    
    765Cash flows from investing activities:Purchase of rental equipment
    
    
    
    
    
    
    
    
    
    
    Net cash used in investing activities
    
    
    
    
    
    
    
    
    
    
    Cash flows from financing activities:Equity certificates yield paid
    
    
    (1,048
    )
    
    
    (903
    )
    
    
    (765
    )Net cash used in financing activities
    
    
    (1,048
    )
    
    
    (903
    )
    
    
    (765
    )Net change in cash and cash equivalents
    
    
    
    
    
    
    
    
    
    
    Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    
    
    
    
    Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    
    
    
    $
    Supplemental disclosure of cash flow information:Interest paid
    
    $
    21,875
    
    
    $
    21,875
    
    
    $
    21,874
  F-4




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HANOVER EQUIPMENT TRUST 2001B
 
 STATEMENTS OF CERTIFICATE HOLDERS EQUITY
  Equity certificates:Balance at inception
    
    $
    Issuance of equity certificates
    
    
    7,750Balance at December 31, 2006, 2005, 2004 and 2003
    
    $
    7,750ACCUMULATED TRUST EARNINGSBalance at December 31, 2003
    
    $
    Net income
    
    
    772Equity certificates yield
    
    
    (772
    )Balance at December 31, 2004
    
    
    Net income
    
    
    917Equity certificates yield
    
    
    (917
    )Balance at December 31, 2005
    
    
    Net income
    
    
    1,055Equity certificates yield
    
    
    (1,055
    )Balance at December 31, 2006
    
    $
    
  F-5




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HANOVER EQUIPMENT TRUST 2001B
 
 NOTES TO FINANCIAL STATEMENTS
 1. Basis of Presentation
   Use of Estimates in the Financial Statements
  Cash and Cash Equivalents
  Revenue Recognition
  Concentrations of Credit Risk
  Rental Equipment
 F-6




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Long-Lived Assets
  Income Taxes
  2. Notes Payable
  Senior Secured Notesfixed rate of 8.75% due September 1, 2011,
interest payable semi-annually on March 1 and September 1
    
    $
    250,000
    Redemption priceAfter Sept 1, 2006
    
    
    104.375
    %After Sept 1, 2007
    
    
    102.917
    %After Sept 1, 2008
    
    
    101.458
    %After Sept 1, 2009
    
    
    100.000
    %
  F-7




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##### Table of Contents



3. Equity Certificates
  4. Lease Transaction
   Period ending December 31:2007
    
    $
    22,9392008
    
    
    22,9392009
    
    
    22,9392010
    
    
    22,939Thereafter
    
    
    15,295$
    107,051
  F-8




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##### Table of Contents



5. Commitments and Contingencies
  6. Recent Accounting Pronouncements
    F-9




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##### Table of Contents



HANOVER EQUIPMENT TRUST 2001B
 SELECTED QUARTERLY UNAUDITED FINANCIAL DATA
  1st
    
    2nd
    
    3rd
    
    4thquarter
    
    quarter
    
    quarter
    
    quarter(in thousands)2006:Rental revenue
    
    $
    5,740
    
    
    $
    5,752
    
    
    $
    5,761
    
    
    $
    5,760Gross profit
    
    
    271
    
    
    
    283
    
    
    
    293
    
    
    
    291Net income
    
    
    250
    
    
    
    261
    
    
    
    273
    
    
    
    2712005:Rental revenue
    
    $
    5,712
    
    
    $
    5,705
    
    
    $
    5,730
    
    
    $
    5,741Gross profit
    
    
    243
    
    
    
    236
    
    
    
    262
    
    
    
    272Net income
    
    
    212
    
    
    
    222
    
    
    
    236
    
    
    
    247
 F-10




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##### Table of Contents



EXHIBIT INDEX
 ExhibitNumber
    
    Description3.1
    
    Certificate of Trust of Hanover Equipment Trust 2001B (incorporated by reference to Exhibit 3.1 to the
Trusts Form S-4, filed with the Commission on December 21, 2001).3.2
    
    Amended and Restated Trust Agreement of Hanover Equipment Trust 2001B, dated as of August 30, 2001,
between General Electric Capital Corporation, as Certificate Holder, and Wilmington Trust Company, as
Trustee (incorporated by reference to Exhibit 3.2 to Form S-4 filed with the Commission on December 21,
2001).4.1
    
    Indenture, dated as of August 30, 2001, between Hanover Equipment Trust 2001B, the Hanover Guarantors
parties thereto, and Wilmington Trust FSB, as Trustee and Collateral Agent, with respect to the 8.75%
Senior Secured Notes due 2011 (incorporated by reference to Exhibit 10.69 to Quarterly Report of
Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15, 2001).4.2
    
    Exchange and Registration Rights Agreement with respect to the 8.75% Senior Secured Notes due 2011,
dated as of August 30, 2001, among Hanover Equipment Trust 2001B, Hanover Compressor Company, certain
Guarantors party thereto, Goldman, Sachs & Co., J.P. Morgan Securities Inc., Salomon Smith Barney, Inc.
and Credit Suisse First Boston Corporation (incorporated by reference to Exhibit 4.2 to the Trusts
Form S-4 filed with the Commission on December 21, 2001).4.3
    
    Participation Agreement, dated as of August 31, 2001, among Hanover Compression Limited Partnership, as
Lessee, Hanover Equipment Trust 2001B, as Lessor, General Electric Capital Corporation, as Certificate
Holders, certain Guarantors party thereto, Wilmington Trust FSB, as Indenture Trustee, Collateral Agent
under the Indenture, and in its individual capacity, only to the extent expressly set forth therein,
and Wilmington Trust Company, in its individual capacity, only to the extent expressly set forth
therein (incorporated by reference to Exhibit 10.66 to Quarterly Report of Hanover Compressor Company
on Form 10-Q, filed with the Commission on November 15, 2001).4.4
    
    Annex A to Participation Agreement and other Operative Agreements, containing certain Rules of Usage
and Definitions (incorporated by reference to Exhibit 4.4 to the Trusts Form S-4 filed with the
Commission on December 21, 2001).4.5
    
    Lease, dated as of August 31, 2001, between Hanover Equipment Trust 2001B, as Lessor, and Hanover
Compression Limited Partnership, as Lessee (incorporated by reference to Exhibit 10.64 to Quarterly
Report of Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15, 2001).4.6
    
    Guarantee, dated as of August 31, 2001, made by Hanover Compression Limited Partnership, Hanover
Compressor Company, certain Guarantors party thereto, and certain Beneficiaries party thereto
(incorporated by reference to Exhibit 10.65 to Quarterly Report of Hanover Compressor Company on Form
10-Q, filed with the Commission on November 15, 2001).4.7
    
    Security Agreement, dated as of August 31, 2001, made by Hanover Equipment Trust 2001B in favor of
Wilmington Trust FSB, as Collateral Agent (incorporated by reference to Exhibit 10.67 to Quarterly
Report of Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15, 2001).4.8
    
    Assignment of Lease, Rents and Guarantee, dated as of August 31, 2001, from Hanover Equipment Trust
2001B to Wilmington Trust FSB, as Collateral Agent (incorporated by reference to Exhibit 10.68 to
Quarterly Report of Hanover Compressor Company on Form 10-Q, filed with the Commission on November 15,
2001).4.9
    
    Instrument of Resignation of Trustee, Appointment and Acceptance of Successor Trustee dated as of
September 29, 2004, incorporated by reference to Exhibit 4.9 to Hanover Equipment Trust 2001Bs Current
Report on Form 8-K filed with the SEC on October 4, 2004.31.1
    
    Certification pursuant to Rule 13a- 14(a)/ 15d-14(a) of the Securities Exchange Act of 1934.*32.1
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.**99.1
    
    Item 1A. Risk Factors from Hanover Compressor Companys Form 10-K for the year ended December 31, 2006.*
 
 *
    
    Filed herewith**
    
    Furnished herewith