These shares were purchased from the company.

They were options of convertible preferred shares in 2008 with an expiration date of 6/30/10, which RP paid $100,000 for 10,000 shares at a price of $10.00 each.

On 6/30/10, these shares were converted to common stock.

Prior to the conversion RP owned 2,738,500 shares, he now owns 3,838,911 shares or an addditional 1,100,411. I'm not sure why the added 100,411, but the price at the close of 6/30/10 was $.09 and that may make up the difference, at least it accounts for most of the difference.

Since we don't have the details of the preferred stock option, we don't know any details except what the prior and now totals state.

Hope this helps the both of you.