SEC Form 4

FORM 4		UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 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	OMB APPROVAL OMB Number: 3235-0287 Estimated average burden hours per response: 0.5
	Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person* FARALLON PARTNERS L L C/CA (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip)	2. Issuer Name and Ticker or Trading Symbol CAPITALSOURCE INC [ CSE ]	5. Relationship of Reporting Person(s) to Issuer (Check all applicable) Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%
	3. Date of Earliest Transaction (Month/Day/Year) 02/06/2004
	4. If Amendment, Date of Original Filed (Month/Day/Year)	6. Individual or Joint/Group Filing (Check Applicable Line) Form filed by One Reporting Person X 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 Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
			Code	V	Amount	(A) or (D)	Price
Common Stock, par value $.01 per share	02/06/2004		S		2,208,900	D	$21.5	7,450,915	D(1)(2)(3)(12)
Common Stock, par value $.01 per share	02/06/2004		S		238,600	D	$21.5	804,899	D(1)(2)(4)(12)
Common Stock, par value $.01 per share								8,255,814	I	See footnotes(1)(2)(5)
Common Stock, par value $.01 per share	02/06/2004		S		4,370,100	D	$21.5	14,740,832	D(1)(2)(6)(12)
Common Stock, par value $.01 per share								14,740,832	I	See footnotes(1)(2)(7)
Common Stock, par value $.01 per share								14,740,832	I	See footnotes(1)(2)(8)
Common Stock, par value $.01 per share								22,996,646	I	See footnotes(1)(2)(9)(10)(11)

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)
				Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares

1. Name and Address of Reporting Person* FARALLON PARTNERS L L C/CA (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* FARALLON CAPITAL PARTNERS LP (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* RR CAPITAL PARTNERS LP (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* LANDRY MONICA R (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* MELLIN WILLIAM F (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* MILLHAM STEPHEN L (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* PATEL RAJIV A (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* SCHRIER DEREK C (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* STEYER THOMAS F (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer X Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

1. Name and Address of Reporting Person* WEHRLY MARK C (Last) (First) (Middle) C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 1325 (Street) SAN FRANCISCO CA 94111 (City) (State) (Zip) Relationship of Reporting Person(s) to Issuer Director X 10% Owner Officer (give title below) X Other (specify below) Member of Group Owning 10%

Explanation of Responses:

1. The aggregate amount of securities sold, as reported in this Form 4, is 6,817,600, of which 2,208,900 shares were sold by Farallon Capital Partners, L.P. ("FCP"); 238,600 shares were sold by RR Capital Partners, L.P. ("RR"); and 4,370,100 shares were sold by Farallon CS Institutional Finance II, L.P. ("Farallon CS LP"). The footnotes of this Form 4 set forth the entities that directly sold such securities, as well as the entities and individuals that may be deemed to be beneficial owners of such securities, and explain the relationships between such entities and individuals. The entities and individuals identified in the footnotes of this Form 4 may be deemed members of a group holding equity securities of the Issuer. The filing of this Form 4 and any statements included herein shall not be deemed to be an admission that such entities and individuals are members of such group.

2. Since the number of reporting persons that may be listed on a Form 4 is limited, the entities listed in footnotes (6) through (8) of this Form 4, David I. Cohen, Chun R. Ding, Joseph F. Downes, William F. Duhamel, Charles E. Ellwein and Richard B. Fried, each as listed in footnote (9) of this Form 4, and Andrew B. Fremder, as listed in footnote (10) of this Form 4, are filing a separate Form 4 on the same date as the filing of this Form 4 as reporting persons with respect to the securities described in this Form 4. Information regarding these entities and these individual filers is included on this Form 4 for purposes of clarification and convenience only, and is duplicative of the information reported in such other Form 4.

3. The amount of securities shown in column 4 was sold directly by, and in column 5 is owned directly by, FCP (FCP, together with RR and Farallon CS LP, the "Partnerships").

4. The amount of securities shown in column 4 was sold directly by, and in column 5 is owned directly by, RR.

5. The amount of securities shown in column 5 is owned directly by FCP and RR. As the general partner to each of FCP and RR, Farallon Partners, L.L.C. ("FPLLC") may be deemed to be the beneficial owner of the Issuer's securities held by each of FCP and RR. FPLLC disclaims any beneficial ownership of any of the Issuer's securities reported herein for purposes of Rule 16a-1(a) under the Securities Exchange Act of 1934, as amended, or otherwise, except as to securities representing FPLLC's pro rata interest in, and interest in the profits of, FCP and RR.

6. The amount of securities shown in column 4 was sold directly by, and in column 5 is owned directly by, Farallon CS LP.

7. The amount of securities shown in column 5 is owned directly by Farallon CS LP. As the general partner to Farallon CS LP, Farallon CS Institutional Finance, L.L.C.("Farallon CS LLC") may be deemed to be the beneficial owner of the Issuer's securities held by Farallon CS LP. Farallon CS LLC disclaims any beneficial ownership of any of the Issuer's securities reported herein for purposes of Rule 16a-1(a) under the Securities Exchange Act of 1934, as amended, or otherwise, except as to securities representing Farallon CS LLC's pro rata interest in, and interest in the profits of, Farallon CS LP.

8. The amount of securities shown in column 5 is owned directly by Farallon CS LP. As the manager to Farallon CS LLC (the general partner to Farallon CS LP), Farallon Capital Management, L.L.C. ("FCMLLC") may be deemed to be the beneficial owner of the Issuer's securities beneficially owned by Farallon CS LLC. FCMLLC disclaims any beneficial ownership of any of the Issuer's securities reported herein for purposes of Rule 16a-1(a) under the Securities Exchange Act of 1934, as amended, or otherwise.

9. The amount of securities shown in column 5 is owned directly by the Partnerships. As a managing member of each of FPLLC and FCMLLC, each of David I. Cohen, Chun R. Ding, Joseph F. Downes, William F. Duhamel, Charles E. Ellwein, Richard B. Fried, Monica R. Landry, William F. Mellin, Stephen L. Millham, Rajiv A. Patel, Derek C. Schrier and Mark C. Wehrly (collectively, the "Managing Members"), and Thomas F. Steyer, (the "Senior Managing Member"), as either a managing member or a senior managing member of FPLLC and FCMLLC, may be deemed to be a beneficial owner of the Issuer's securities held by the Partnerships as referenced in footnotes (3), (4) and (6) of this Form 4.

10. Pursuant to Limited Powers of Attorney, dated as of February 1, 2003, Andrew B. Fremder ("Fremder") was granted limited powers of attorney to act for each of FCMLLC and FPLLC with regard to the Issuer's securities directly held by the Partnerships. Such powers of attorney may only be exercised by Fremder jointly with any of the Managing Members or the Senior Managing Member. As a result of such restriction, Fremder does not by himself have the power to vote, or direct the voting of, the Issuer's securities directly held by the Partnerships. Rather, Fremder shares such power with the Managing Members and the Senior Managing Member. Pursuant to such powers of attorney, Fremder may be deemed to be a beneficial owner of the Issuer's securities held by the Partnerships as referenced in footnotes (3), (4) and (6) of this Form 4.

11. The Managing Members, the Senior Managing Member and Fremder disclaim any beneficial ownership of any of the Issuer's securities reported herein for purposes of Rule 16(a)-1(a) under the Securities Exchange Act of 1934, as amended, or otherwise.

12. The price shown in column 4 is the public offering price in the underwritten offering of shares by certain stockholders of the issuer, which closed on February 6, 2004. Each of the Partnerships received a net price (minus the underwriters' discount) of $20.7475 per share.

	/s/ Monica R. Landry as attorney-in-fact and/or authorized signer for each of the reporting persons listed in footnotes (3) through (5)	02/10/2004
	.	02/10/2004
	/s/ Monica R. Landry, on her own behalf, and as attorney-in-fact and/or authorized signer for each of William F. Mellin, Stephen L. Millham, Rajiv A. Patel, Derek C. Schrier, Thomas F. Steyer and Mark C. Wehrly	02/10/2004
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	.	02/10/2004
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	** 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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