X0202 4 2007-09-28 0 0001241199 CAPITALSOURCE INC CSE 0001257511 FREMDER ANDREW B C/O FARALLON CAPITAL MANAGEMENT, L.L.C. ONE MARITIME PLAZA, SUITE 2100 SAN FRANCISCO CA 94111 1 0 1 1 Member of Group Owning 10% Phantom Stock 2007-09-28 4 A 0 99 0 A Common Stock 99 5453 D Phantom Stock 2007-09-28 4 A 0 2470 0 A Common Stock 2470 7923 D Each share of phantom stock represents the right to receive one share of common stock. These shares of phantom stock are payable upon termination of the reporting person's service as a director, a date selected by the reporting person or as provided in the Issuer's Deferred Compensation Plan, a form of which was filed with the Securities and Exchange Commission on February 2, 2004 as Exhibit 10.21 to the Issuer's Registration Statement on Form S-1/A (Reg. No. 333-112002). The number of derivative securities reported in Column 9 includes 154 phantom stock units received by Fremder on or about September 28, 2007 pursuant to the Issuer's Deferred Compensation Plan. The Issuer declared a quarterly cash dividend to all of its holders of record of shares of common stock on September 17, 2007. The 154 phantom stock units represent the re-investment of the cash dividend payable to Fremder with respect to his existing phantom stock units pursuant to the Issuer's Deferred Compensation Plan. The receipt of such additional phantom stock units was exempt from Section 16 of the Securities Exchange Act of 1934, as amended. As reported in the Form 4s filed by Fremder and certain entities and individuals affiliated with Farallon Capital Management, L.L.C. and Farallon Partners, L.L.C. on March 14, 2006 with respect to the Issuer's common stock (together, the "Farallon Form 4s"), Fremder, pursuant to the grant of Limited Powers of Attorney dated as of February 1, 2003 (the "Limited POA"), may be deemed to be a beneficial owner of the securities reported in the Farallon Form 4s. Such Limited POA was revoked as of September 25, 2007. Notwithstanding the revocation of the Limited POA referred to in Item (4) above, Fremder, together with the entities and individuals identified in the Farallon Form 4s, may be deemed members of a group holding equity securities of the Issuer. Fremder expressly disclaims that he is a member of such group. However, if deemed a member of such group, Fremder would be a beneficial owner of the securities reported in the Farallon Form 4s. Fremder disclaims any beneficial ownership of any of the Issuer's securities reported in the Farallon Form 4s for purposes of Rule 16(a)-1(a) under the Securities Exchange Act of 1934, as amended, or otherwise. The 2,470 phantom stock units reported in this row represent an additional equity grant issued by the Issuer to each of the members of the Board of Directors, which grant Fremder elected to receive in the form of phantom stock units. /s/ Monica R. Landry 2007-10-02