Posted By: sm. on 2005-08-19

ATLANTA -- Aug. 18, 2005 -- Transcend
SERVICES, INC. (Nasdaq SmallCap: TRCR) today announced that a co-founder of Medical Dictation Inc. ("MDI"), Sue McGrogan, has agreed to invest $200,000 in
Transcend as of August 15, 2005 through the purchase of 71,942 shares of common stock. This purchase is part of an overall option agreement that provides four options to purchase $200,000 each that could result in $800,000 of total
investment over the next two years. Half of the investment will be in cash and
the other half in the forgiveness of a note due to Sue McGrogan from her sale of
MDI to Transcend. These purchases will be made at a price of 110% of the average market price for the ten trading days prior to said purchase. The remaining
three options are exercisable on the six- month anniversary dates of the
execution of the option agreement and cannot be carried forward once the option
date has passed.

MDI is a transcription company that has been in operation since 1988 in
Brooksville, Florida founded by Sue McGrogan and her mother Liz McGrogan. The McGrogans first entered the industry in 1972 as owner-operators of a medical transcription company in New Jersey. MDI recently became a wholly owned subsidiary of Transcend.

Both Liz and Sue McGrogan have played an important role in Transcend since the
acquisition of MDI by Transcend on January 31, 2005. Liz currently serves as
interim general manager at MDI, which has grown from $6.4 million in revenue in
2004 to a current annualized level of over $8 million. Sue is a Business Unit
Manager at Transcend, managing a significant portion of Transcend's field
operations. Alex Munoz, Transcend's EVP of Operations stated, "Having worked
closely with Liz and Sue during the integration of our two companies, their
level of increased commitment is exciting as we continue to make changes within
the company." Liz McGrogan agreed, commenting, "We are both very excited about the future of Transcend and MDI, and the potential growth through new business and acquisitions." Sue added, "The decision to invest money into Transcend is indicative of our confidence in Transcend and its future."

• Transcend and MDI Founder Announce Stock Option Agreement - sm. (Views: 317, 2005-08-19)