SEC FORM 5

SEC Form 5

FORM 5

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

ANNUAL STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

Form 3 Holdings Reported.

Form 4 Transactions Reported.

1. Name and Address of Reporting Person^*

Pandora Select Partners, L.P.

(Last)

(First)

(Middle)

3033 EXCELSIOR BOULEVARD, SUITE 300

(Street)

MINNEAPOLIS

55416

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
CAPSOURCE FINANCIAL INC [ CPSO ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

Director	X	10% Owner
Officer (give title below)		Other (specify below)

3. Statement for Issuer's Fiscal Year Ended (Month/Day/Year)
12/31/2006

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)	4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned at end of Issuer's Fiscal Year (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock⁽¹⁾	10/29/2006		M4	375,000	A	$0.4	2,875,000	D⁽²⁾⁽³⁾

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)	5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock (Right to Buy)⁽⁴⁾	$0.4	10/29/2006		4M		375,000	⁽⁵⁾	10/29/2006	Common Stock	375,000	⁽¹⁾	0	D⁽²⁾⁽³⁾

Explanation of Responses:

1. The reporting person entered into a Securities Purchase Agreement with the issuer on May 1, 2006 pursuant to which the reporting person paid $1,000,000 for (i) 2,500,000 shares of Common Stock, (ii) a warrant to purchase 2,500,000 shares of common stock and (iii) an option to purchase an additional 375,000 shares of common stock and warrants to purchase 375,000 shares of common stock.

2. The general partner of the reporting person is Pandora Select Advisors, LLC ("PSA"), which manages accounts for the benefit of the reporting person, Pandora Select Fund, LP ("PSPLP") and Pandora Select Fund, Ltd. ("PSFLTD"). The managing member and controlling owner of the reporting person is Whitebox Advisors, LLC ("Whitebox Advisors").

3. Based on the relationships described herein, these entities may be deemed to constitute a group (also see "Remarks" section herein) within the meaning of Rule 13d-5(b)(1) under the Securities and Exchange Act of 1934. The filing of this statement shall not be construed as an admission that Whitebox Advisors, PSA, PSFLP and PSFLTD are a group or have agreed to act as a group. Each of the identified entities each disclaim beneficial ownership of such shares of common stock except to the extent of their pecuniary interest in such shares.

4. The reported securities are part of a unit which the reporting person has the right to acquire. The unit consists of the right to acquire 375,000 shares of common stock and a right to acquire a warrant to purchase 375,000 shares of common stock. The exercise price of the unit is $.40 for one share of common stock and a warrant to purchase one share of common stock.

5. Immediately.

	Jonathan D. Wood Chief Fiinancial Officer of Pandora Select Advisors, LLC, General Partner of Pandora Select Partners, L.P.	02/14/2007
	** Signature of Reporting Person	Date
Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
* If the form is filed by more than one reporting person, see Instruction 4 (b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
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