Thank you very much for your input.... I just asked a friend of mine who had the same problem, and he told me that this is not an issue...in fact, he applied with an expired passport and he got his h-1b transfer. He said he had the same worry and his lawyer told him it's not a problem as long as he entered into U.S. legally....
Again, I really appreciate your taking time to respond to my question, and want to thank you for sharing your thoughts. Thank you!!!