
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-Q

(Mark One)

[X]  Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
     Act of 1934 For the quarterly period ended JUNE 30, 1997 or 

[ ]  Transition report pursuant to Section 13 or 15(d) of the Securities
     Exchange Act of 1934 For the transition period from _____ to _____
     
                         Commission File Number: 0-28056

                               ------------------

                                 COACH USA, INC.
             (Exact name of Registrant as specified in its charter)

           DELAWARE                                      76-0496471
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
incorporation or organization)


          ONE RIVERWAY, SUITE 600
               HOUSTON, TEXAS                               77056
 (Address of principal executive offices)                (Zip Code)

       Registrant's telephone number, including area code: (713) 888-0104

           Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                            Yes  [X]            No  [ ]

           The number of shares of Common Stock of the Registrant, par value
$.01 per share, outstanding at August 12, 1997 was 19,519,774.
<PAGE>
                                 COACH USA, INC.
                  FORM 10-Q FOR THE QUARTER ENDED JUNE 30, 1997
                                      INDEX
                                                                            PAGE
PART I - FINANCIAL INFORMATION
  Item I - Financial Statements

       COACH USA, INC. PRO FORMA COMBINED
            Introduction to Pro Forma Combined Statements of Income........    3
            Pro Forma Combined Statements of Income........................    4
            Notes to Pro Forma Combined Statements of Income...............    5
                                                                              
       COACH USA, INC. AND SUBSIDIARIES                                       
            Condensed Consolidated Balance Sheets..........................    6
            Condensed Consolidated Statements of Income....................    7
            Condensed Consolidated Statements of Stockholders' Equity......    8
            Condensed Consolidated Statements of Cash Flows................    9
            Notes to Condensed Consolidated Financial Statements...........   10
                                                                           

  Item II - Management's Discussion and Analysis of Financial Condition
             and Results of Operations.....................................   15

PART II - OTHER INFORMATION

  Item 1 - Legal proceedings...............................................   20

  Item 2 - Changes in Securities...........................................   20

  Item 3 - Defaults Upon Senior Securities.................................   20

  Item 4 - Submission of Matters to a Vote of Security Holders.............   20

  Item 5 - Other Information...............................................   20

  Item 6 - Exhibits and Reports on Form 8-K................................   20

       (a)  Exhibits.

                Exhibit 10.1 Credit Agreement Among Coach USA, Inc. as Borrower,
                The Financial Institutions named in this Credit Agreement as 
                Banks and NationsBank of Texas, N.A., as Agent for the Banks
                dated August 13, 1997.

                Exhibit 27.1 Financial Data Schedule

       (b)  Reports on Form 8-K.

Signature...................................................................  22

                                        2
<PAGE>
                                 COACH USA, INC.
                     PART I, ITEM 1 -- FINANCIAL INFORMATION
                               GENERAL INFORMATION

             INTRODUCTION TO PRO FORMA COMBINED STATEMENTS OF INCOME

        In September 1995, Coach USA, Inc. ("Coach USA" or the "Company"), was
founded to create a national company providing motorcoach transportation
services, including charter and tour services, and related passenger ground
transportation services.

        In May 1996, Coach USA acquired, simultaneously with the closing of an
initial public offering (the "Initial Public Offering"), six established
businesses. Consideration for these businesses consisted of a combination of
cash and common stock of Coach USA. These six businesses along with Coach USA
prior to the Initial Public Offering are referred to herein as the "Founding
Companies" and the transaction pursuant to which these six businesses were
acquired is referred to herein as the "Merger" or "Mergers." Coach USA has
acquired additional businesses in 1996 and 1997. Of these additional businesses
acquired (collectively the "Acquisitions"), several acquisitions were accounted
for as poolings-of-interests and are referred to herein as the "Pooled
Companies." The remaining businesses acquired were accounted for as purchases
and are referred to herein as the "Purchased Companies."

        The accompanying pro forma combined statements of income of the Company
for the six months ended June 30, 1996 and 1997, respectively, include the
combined operations of the Pooled Companies and the Founding Companies from
January 1, 1996, and the Purchased Companies from the date of their acquisition.

        The Founding Companies were not under common control or management
through May 1996. The Pooled Companies and Purchased Companies were not under
common control or management prior to their acquisition. This pro forma
information may not be indicative of the actual results if the transactions had
occurred on the dates indicated or the actual results which may be realized in
the future. Expected benefits and cost reductions anticipated by the Company,
future corporate costs of Coach USA, and interest expense savings as a result of
the offering proceeds have not been reflected in the pro forma information for
1996.

        Operating results for the interim periods are not necessarily indicative
of the results for full years. The results of the Company have historically been
subject to significant seasonal fluctuations. It is suggested that these pro
forma combined financial statements be read in conjunction with the consolidated
financial statements of the Company and the Founding Companies and the notes
thereto included in the Company's Annual Report on Form 10-K (File No. 28056),
as filed with the Securities and Exchange Commission ("SEC") and the
supplemental consolidated financial statements of the Company included in Form
8-K dated August 8, 1997.

                                        3
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
                     PRO FORMA COMBINED STATEMENTS OF INCOME
                     (IN THOUSANDS, EXCEPT PER SHARE DATA )
                                   (UNAUDITED)
<TABLE>
<CAPTION>
                                                               SIX MONTHS ENDED
                                                                    JUNE 30,
                                                         -----------------------------
                                                             1996              1997
                                                         -----------       -----------
<S>                                                      <C>               <C>        
REVENUES.................................................$   139,214       $   199,329
OPERATING EXPENSES.......................................    109,062           150,893
                                                         -----------       -----------
           Gross profit..................................     30,152            48,436
GENERAL AND ADMINISTRATIVE EXPENSES......................     19,970            22,128
GOODWILL AND OTHER AMORTIZATION..........................        234             1,342
ACQUISITION RELATED COSTS................................       --                 348
                                                         -----------       -----------
           Operating income..............................      9,948            24,618

INTEREST EXPENSE.........................................      5,043             7,343
                                                         -----------       -----------
INCOME BEFORE INCOME TAXES AND EXTRAORDINARY ITEMS.......      4,905            17,275

PROVISION FOR INCOME TAXES...............................      2,201             7,208
                                                         -----------       -----------
INCOME BEFORE EXTRAORDINARY ITEMS........................      2,704            10,067
EXTRAORDINARY ITEMS (NET OF INCOME TAXES)................       --                (400)
                                                         -----------       -----------
NET INCOME ..............................................$     2,704       $     9,667
                                                         ===========       ===========
PRO FORMA ADJUSTMENTS:
      Income before extraordinary items..................$     2,704       $    10,067
      Pro forma compensation and interest differential...      4,848               425
      Acquisition related costs..........................       --                 348
      Less:  Pro forma provision for income taxes........      1,849               172
                                                         -----------       -----------
PRO FORMA INCOME BEFORE EXTRAORDINARY ITEMS..............$     5,703       $    10,668
                                                         ===========       ===========
WEIGHTED AVERAGE COMMON AND
  COMMON EQUIVALENT SHARES OUTSTANDING...................     15,250            19,904
                                                         ===========       ===========
PRO FORMA INCOME PER COMMON AND COMMON
EQUIVALENT SHARE BEFORE EXTRAORDINARY ITEMS..............$       .37       $       .54
                                                         ===========       ===========
</TABLE>
The accompanying notes are an integral part of these pro forma combined
statements of income.

                                        4
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
                NOTES TO PRO FORMA COMBINED STATEMENTS OF INCOME

        The Founding Companies, Pooled Companies and Purchased Companies have
been managed prior to their acquisitions as independent private companies.
Therefore, general and administrative expenses and interest expense for the
periods presented reflect compensation and related benefits that owners received
from their respective businesses prior to acquisition. Additional pro forma
adjustments have been presented for the purpose of reflecting net income as if
the merger of the Founding Companies and the acquisition of the Pooled Companies
had occurred January 1, 1996. Certain stockholders agreed to reductions in
salaries, benefits and the conversion of outstanding debt to equity in
connection with the Acquisitions. Certain stockholders also have entered into
employment agreements which provide for a set base salary, participation in
future incentive bonus plans, certain other benefits and two-year covenants not
to compete following termination of such person's employment.

        The pro forma data presents compensation at the level that certain
stockholders of the Company agreed to receive from the Founding and Pooled
Companies subsequent to the Merger and Pooled Company acquisitions as well as a
non-recurring non-cash charge recorded by the Company in March 1996. In
addition, the pro forma data presents the reduction of interest expense related
to the conversion of stockholders' debt to equity at one of the Pooled
Companies, the reduction of the acquisition related costs incurred in the
acquisition of the Pooled Companies, and the incremental provision for income
taxes as if all entities had been subject to federal and state income taxes and
for the impact of the compensation differential and interest reduction discussed
above.

PRO FORMA NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE

        The computation of pro forma net income per common and common equivalent
share for the six months ended June 30, 1996 is based upon 15,249,587 weighted
average shares outstanding which includes (i) 2,165,724 shares issued by Coach
USA prior to the Initial Public Offering, (ii) 5,099,687 shares issued to the
stockholders of the Founding Companies in connection with the Initial Public
Offering, (iii) 1,700,714 of the 4,140,000 shares sold in the Initial Public
Offering to pay the cash portion of the consideration for the Founding
Companies, (iv) 118,142 of the 4,140,000 shares sold in the Initial Public
Offering attributed to excess S Corporation distributions, (v) 561,156 of the
4,140,000 shares sold in the Initial Public Offering, net of shares sold to
cover the purchase of the Founding Companies, (vi) 5,027,305 shares issued in
connection with the acquisition of the Pooled Companies, (vii) 425,039 shares
issued in connection with the conversion of indebtedness to equity at one of the
Pooled Companies, and (viii) 151,820 shares representing the weighted average
portion of shares for the dilution attributable to outstanding options to
purchase the Company's common stock, using the treasury stock method.

        The computation of pro forma net income per common and common equivalent
share for the six months ended June 30, 1997 is based upon 19,904,180 weighted
average shares outstanding, common and common equivalent shares, which include
(i) 18,942,062 shares issued and outstanding for the entire six month period and
(ii) 981 shares issued to minority interests of the Pooled Companies, and (iii)
285,231 representing the weighted average portion of shares issued in connection
with the Acquisitions completed in 1997, and (iv) 675,906 shares representing
the weighted average portion of shares for the dilution attributable to
outstanding options to purchase the Company's common stock, using the treasury
stock method.

                                        5
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                        (IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
                                                                                                    DECEMBER 31,        JUNE 30,
                                                                                                        1996              1997
                                                                                                   -------------       ---------
                               ASSETS                                                                                 (Unaudited)

CURRENT ASSETS:
<S>                                                                                                <C>               <C>          
         Cash and cash equivalents.................................................................$       2,786     $       1,512
         Accounts receivable, less allowance of $2,579 and $2,997..................................       23,216            32,766
         Notes receivable, current portion.........................................................        2,811             3,438
         Inventories...............................................................................        9,670            13,080
         Prepaid expenses and other current assets.................................................       13,797            20,399
                                                                                                   -------------     -------------
                Total current assets...............................................................       52,280            71,195

PROPERTY AND EQUIPMENT, net........................................................................      224,830           346,102
NOTES RECEIVABLE, less allowance of $500 and $500..................................................        4,231             6,142
GOODWILL, net......................................................................................       30,561            91,905
OTHER ASSETS, net..................................................................................       17,916            23,447
                                                                                                   -------------     -------------
                Total assets.......................................................................$     329,818     $     538,791
                                                                                                   =============     =============
                                  LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
         Current maturities of long-term obligations...............................................$      19,872     $      13,764
         Accounts payable and accrued liabilities..................................................       45,885           111,619
                                                                                                   -------------     -------------
                Total current liabilities..........................................................       65,757           125,383

LONG-TERM OBLIGATIONS, net of current maturities...................................................      108,955            56,510
SENIOR SUBORDINATED NOTES..........................................................................         --             150,000
CONVERTIBLE SUBORDINATED NOTES, net of current maturities..........................................       18,500            40,580
DEFERRED INCOME TAXES..............................................................................       24,027            34,961
                                                                                                   -------------     -------------
                Total liabilities..................................................................      217,239           407,434
                                                                                                   -------------     -------------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
         Common stock $.01 par, 30,000,000 shares authorized, 18,942,062 and
            19,488,034 shares issued and outstanding...............................................          189               194
         Additional paid-in capital................................................................      103,274           112,470
         Cumulative translation adjustment.........................................................         (209)             (222)
         Retained earnings.........................................................................        9,325            18,915
                                                                                                   -------------     -------------
                Total stockholders' equity.........................................................      112,579           131,357
                                                                                                   -------------     -------------
                Total liabilities and stockholders' equity.........................................$     329,818     $     538,791
                                                                                                   =============     =============
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                        6
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                  (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                                          THREE MONTHS ENDED                 SIX MONTHS ENDED
                                                                               JUNE 30,                          JUNE 30,
                                                                      ---------------------------     -----------------------------
                                                                          1996            1997             1996             1997
                                                                      -----------     -----------     ------------     ------------
<S>                                                                   <C>             <C>             <C>              <C>         
REVENUES............................................................  $    56,713     $   119,083     $     94,276     $    199,329
OPERATING EXPENSES..................................................       42,747          87,322           71,437          150,893
                                                                      -----------     -----------     ------------     ------------
           Gross profit.............................................       13,966          31,761           22,839           48,436
GENERAL AND ADMINISTRATIVE EXPENSES.................................        6,492          12,074           12,893           22,128
AMORTIZATION EXPENSE................................................          122             813              234            1,342
ACQUISITION RELATED COSTS...........................................         --               231             --                348
                                                                      -----------     -----------     ------------     ------------
           Operating income.........................................        7,352          18,643            9,712           24,618

INTEREST EXPENSE....................................................        1,482           3,871            3,409            7,343
                                                                      -----------     -----------     ------------     ------------

INCOME BEFORE INCOME TAXES AND
   EXTRAORDINARY ITEMS..............................................        5,870          14,772            6,303           17,275
PROVISION FOR INCOME TAXES..........................................        2,598           6,153            2,638            7,208
                                                                      -----------     -----------     ------------     ------------
INCOME BEFORE EXTRAORDINARY ITEMS...................................        3,272           8,619            3,665           10,067
EXTRAORDINARY ITEMS (NET OF INCOME TAXES)...........................        --               (311)           --                (400)
                                                                      -----------     -----------     ------------     ------------
NET INCOME..........................................................  $     3,272     $     8,308     $      3,665     $      9,667
                                                                      ===========     ===========     ============     ============
WEIGHTED AVERAGE COMMON AND COMMON
  EQUIVALENT SHARES OUTSTANDING.....................................       10,908          20,028            8,362           19,904
                                                                      ===========     ===========     ============     ============

INCOME PER COMMON AND COMMON
  EQUIVALENT SHARE:
BEFORE EXTRAORDINARY ITEMS..........................................  $       .30     $       .43     $        .44     $        .51

EXTRAORDINARY ITEMS ................................................         --              (.02)            --               (.02)
                                                                      -----------     -----------     ------------     ------------

NET INCOME .........................................................  $       .30     $       .41     $        .44     $        .49
                                                                      ===========     ===========     ============     ============
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                        7
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
            CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                             (AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
                                                                                  ADDITIONAL   CUMULATIVE   RETAINED      TOTAL
                                                              COMMON STOCK         PAID-IN    TRANSLATION   EARNINGS   STOCKHOLDERS'
                                                           SHARES      AMOUNT      CAPITAL     ADJUSTMENT   (DEFICIT)     EQUITY
                                                          --------   ----------   ----------  -----------  -----------  ----------
<S>                                                         <C>     <C>          <C>         <C>          <C>          <C>       
BALANCE AT DECEMBER 31, 1995..............................   5,028   $       50   $    6,932  $     (200)  $    (1,192) $    5,590
    Issuance of Common Stock:
        Proceeds of stock offerings.......................   6,224           62       96,502         --           --        96,564
        Merger with Predecessor...........................   2,166           22        2,055         --         (2,053)         24
        Acquisition of Founding Companies.................   5,099           51        6,323         --          9,155      15,529
    Cash Distribution to Founding
       Companies' Shareholders............................    --           --        (23,810)        --                    (23,810)
    Reorganization .......................................    --           --          4,402         --         (4,402)       --
    Conversion from S Corporation to C
       Corporation Founding Companies.....................    --           --           --           --         (5,426)     (5,426)
    Conversion of debt to equity..........................     425            4       10,198         --           --        10,202
    S Corporation dividends paid by
       certain Pooled Companies...........................    --           --           --           --         (2,139)     (2,139)
    Adjustment to conform fiscal year ....................
       ends of Pooled Companies...........................    --           --           --           --            267         267
    Net income............................................    --           --           --                      15,115      15,115
    Capital contributions equal to the current income
       taxes of S Corporations............................    --           --            341         --           --           341
    Other.................................................    --           --            331           (9)        --           322
                                                          --------   ----------   ----------  -----------  -----------  ----------
BALANCE AT DECEMBER 31, 1996..............................  18,942   $      189   $  103,274  $      (209) $     9,325  $  112,579
    Issuance of Common Stock:.............................
        Acquisition of Purchased Companies (unaudited)         390            4        8,486         --           --         8,490
        Exercise of stock options (unaudited).............      30         --            420         --           --           420
    Equity of acquired companies treated as insignificant
        poolings-of-interest (unaudited)..................     125            1          219         --            241         461
    Other (unaudited).....................................       1         --             71          (13)        (318)       (260)
    Net income (unaudited)................................    --           --           --           --          9,667       9,667
                                                          --------   ----------   ----------  -----------  -----------  ----------
BALANCE AT JUNE 30, 1997 (unaudited)......................  19,488   $      194   $  112,470         (222) $    18,915  $  131,357
                                                          ========   ==========   ==========  ===========  ===========  ==========
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                        8
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (AMOUNTS IN THOUSANDS)
                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                                                                                SIX MONTHS ENDED
                                                                                                                     JUNE 30,
                                                                                                            ------------------------
                                                                                                                1996          1997
                                                                                                            -------------   --------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                                   <C>             <C>          
      Net income......................................................................................$       3,665   $       9,667
      Adjustments to reconcile net income to net cash
           provided by operating activities-
           Depreciation and amortization .............................................................        5,357          13,017
           Gain on disposal of assets.................................................................         (180)           (487)
           Deferred tax provision ....................................................................        3,170           4,107
           Changes in operating assets and liabilities-
                Accounts receivable, net..............................................................       (5,546)         (1,984)
                Inventories...........................................................................       (1,344)         (1,417)
                Notes receivable......................................................................       (1,479)         (2,538)
                Prepaid expenses and other current assets.............................................        1,915          (4,738)
                Accounts payable and accrued liabilities..............................................       (1,074)         29,199
                Other.................................................................................          632          (6,329)
                                                                                                      -------------   -------------
                     Net cash provided by operating activities........................................        5,116          38,497
                                                                                                      -------------   -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
      Additions to property and equipment.............................................................       (9,799)        (67,715)
      Proceeds from sales of property and equipment...................................................        2,098           5,568
      Cash consideration paid for founding companies, net of cash acquired............................      (22,112)           --
      Cash consideration paid for Purchased Companies,
        net of cash acquired..........................................................................         --           (36,656)
                                                                                                      -------------   -------------
                     Net cash used in investing activities............................................      (29,813)        (98,803)
                                                                                                      -------------   -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
      Principal payments on long-term obligations.....................................................      (49,618)        (84,519)
      Proceeds from issuance of long-term obligations, net............................................       27,571         143,367
      Proceeds from issuance of common stock..........................................................       48,062             420
      S Corporation dividends paid by certain Pooled Companies........................................         (487)           (236)
      Other...........................................................................................         (147)           --
                                                                                                      -------------   -----------
           Net cash provided by financing activities..................................................       25,381          59,032
NET INCREASE (DECREASE) IN CASH.......................................................................          684          (1,274)
CASH AND CASH EQUIVALENTS, beginning of period........................................................        5,251           2,786
                                                                                                      -------------   -------------
CASH AND CASH EQUIVALENTS, end of period..............................................................$       5,935   $       1,512
                                                                                                      =============   =============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
      INFORMATION:
           Cash paid for interest.....................................................................$       5,167   $       7,672
           Cash paid for income taxes.................................................................          891             775
           Assets acquired under capital leases.......................................................        3,275           2,355
           Debt issued for Purchased Companies........................................................         --            22,080
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                        9
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.      BUSINESS AND ORGANIZATION:

        In September 1995, Coach USA, Inc. ("Coach USA" or the "Company") was
founded to create a national company providing motorcoach transportation
services, including charter and tour services, and related passenger ground
transportation services.

        In May 1996, Coach USA acquired, simultaneously with the closing of its
initial public offering (the "Initial Public Offering"), six established
businesses. Consideration for these businesses consisted of a combination of
cash and common stock of Coach USA (the "Common Stock"). These six businesses
along with Coach USA prior to the Initial Public Offering are referred to herein
as the "Founding Companies," and the transaction pursuant to which these six
businesses were acquired is referred to herein as the "Merger" or "Mergers."
Coach USA has acquired additional businesses in 1996 and 1997. Of these
additional businesses acquired, those accounted for as poolings-of-interests are
referred to herein as the "Pooled Companies." The remaining businesses were
accounted for as purchases and are referred to herein as the "Purchased
Companies" (see Note 6).

2.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

    INTERIM CONDENSED CONSOLIDATED FINANCIAL INFORMATION

        The unaudited condensed consolidated financial statements have been
prepared pursuant to the rules and regulations of the SEC. Certain information
and footnote disclosures, normally included in annual financial statements
prepared in accordance with generally accepted accounting principles, have been
condensed or omitted pursuant to those rules and regulations, although the
Company believes that the disclosures made are adequate to make the information
presented not misleading. In the opinion of management, all adjustments,
consisting only of normal recurring adjustments, necessary to fairly present the
financial position, results of operations and cash flows with respect to the
interim consolidated financial statements, have been included. The results of
operations for the interim periods are not necessarily indicative of the results
for the entire fiscal year.

        It is suggested that these condensed consolidated financial statements
be read in conjunction with the audited supplemental consolidated financial
statements and notes thereto of Coach USA included in the Company's Form 8-K
filed with the SEC on August 8, 1997.

    SEASONALITY

        The timing of certain holidays, weather conditions and seasonal vacation
patterns may cause the Company's quarterly results of operations to fluctuate
significantly. The Company expects to realize higher revenues, operating income
and net income during the second and third quarters and lower revenues and net
income during the first and fourth quarters.

    RECLASSIFICATIONS

        Certain reclassifications have been made in prior periods to conform
with the current presentation.

                                       10
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS --
                                   (CONTINUED)

3.      NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE

        The computation of net income per common and common equivalent share for
the three months ended June 30, 1996 is based upon 10,908,087 weighted average
shares outstanding which includes (i) the weighted average portion of 2,165,724
shares issued by Coach USA prior to the Initial Public Offering, (ii) the
weighted average portion of 5,099,687 shares issued to the stockholders of the
Founding Companies in connection with the Initial Public Offering, (iii) the
weighted average potion of 4,140,000 shares sold in the Initial Public Offering,
(iv) 5,027,305 shares issued in connection with the acquisition of the Pooled
Companies, and (v) 425,039 shares issued in connection with the conversion of
indebtedness to equity at one of the Pooled Companies.

        The computation of net income per common and common equivalent share for
the six months ended June 30, 1996 is based upon 8,361,516 weighted average
shares outstanding which includes (i) the weighted average portion of 2,165,724
shares issued by Coach USA prior to the Initial Public Offering, (ii) the
weighted average portion of 5,099,687 shares issued to the stockholders of the
Founding Companies in connection with the Initial Public Offering, (iii) the
weighted average portion of 4,140,000 shares sold in the Initial Public
Offering, (iv) 5,027,305 shares issued in connection with the acquisition of the
Pooled Companies, and (v) 425,039 shares issued in connection with the
conversion of indebtedness to equity at one of the Pooled Companies.

    The computation of net income per common and common equivalent share for the
three months ended June 30, 1997 is based upon 20,028,273 weighted average
shares outstanding, common and common equivalent share, which include (i)
18,942,062 shares issued and outstanding for the entire three month period, (ii)
981 shares issued to minority interest of the Pooled Companies, (iii) 465,128
representing the weighted average portion of shares issued in connection with
the Acquisitions completed in 1997, and (iv) 620,102 shares representing the
weighted average portion of shares for the dilution attributable to outstanding
options to purchase the Company common stock, using the treasury stock method.

    The computation of net income per common and common equivalent share for the
six months ended June 30, 1997 is based upon 19,904,180 weighted average shares
outstanding, common and common equivalent share, which include (i) 18,942,062
shares issued and outstanding for the entire six month period, (ii) 981
shares issued to minority interest of the Pooled Companies, (iii) 285,231
representing the weighted average portion of shares issued in connection with
the Acquisitions completed in 1997, and (iv) 675,906 shares representing the
weighted average portion of shares for the dilution attributable to outstanding
options to purchase the Company common stock, using the treasury stock method.

        Fully diluted net income per common and common equivalent share is equal
to primary earnings per share for all periods presented.

    NEW ACCOUNTING PRONOUNCEMENT

In February 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards (SFAS) No. 128, "Earnings Per Share." SFAS No.
128 revises the methodology to be used in computing earnings per share (EPS)
such that the computations required for primary and fully

                                       11
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS --
                                   (CONTINUED)

diluted EPS are to be replaced with "basic" and "diluted" EPS. Basic EPS is
computed by dividing net income by the weighted average number of shares of
common stock outstanding during the year. Diluted EPS is computed in the same
manner as fully diluted EPS, except that, among other changes, the average share
price for the period is used in all cases when applying the treasury stock
method to potentially dilutive outstanding options.

        The Company will adopt SFAS No. 128 effective December 15, 1997, and
will restate EPS for all periods presented. The Company anticipates that the
amounts reported for basic EPS for the unaudited six months ended June 30, 1996
and 1997 will be $.45 and $.50, and that basic EPS for the unaudited pro forma
six months ended June 30, 1996 and 1997 will be $.34 and $.55. The Company
anticipates that the amounts reported for diluted EPS for the unaudited six
months ended June 30, 1996 and 1997 will be $.44 and $.49 and that diluted EPS
for the unaudited pro forma six months ended June 30, 1996 and 1997 will be $.34
and $.54.

4.      LONG TERM OBLIGATIONS

        In May 1996, the Company entered into a revolving credit agreement with
a bank ("Credit Facility"). In August 1997, the Company amended and restated its
Credit Facility. The Credit Facility, as amended, provides for a revolving
facility of $300 million through a syndicate of seventeen banks, and allows the
Company to have other senior indebtedness of $80 million (in addition to fully
subordinated debt) outside the Credit Facility. The Credit Facility is secured
by substantially all of the assets of the Company and matures August, 2000, at
which time all amounts then outstanding become due. Interest on outstanding
borrowings is charged, at the Company's option, at the banks' prime rate plus up
to 0.25% or the London Interbank Offered Rate ("LIBOR") plus 0.50% to 1.75%
(6.63% at August 13, 1997), both as determined by the ratio of the Company's
funded debt to cash flow (as defined). A commitment fee ranging from 0.15% to
0.375% is payable on the unused portion of the Credit Facility. Under the terms
of the Credit Facility, the Company must maintain certain minimum financial
ratios, including minimum net worth, minimum fixed charge coverage ratios, and
maximum capital expenditure levels. The Credit Facility prohibits the payment of
cash dividends. As of August 13, 1997, the Company had a total of $105.8 million
outstanding under the Credit Facility and other sources and had utilized $7.5
million of the facility for letters of credit securing certain insurance
obligations and performance bonds, resulting in a borrowing availability of
$266.7 million under the Credit Facility and other sources. The Company's
obligations under the Credit Facility are guaranteed by the subsidiaries of the
domestic Company.

        In June 1997, the Company completed the sale of $150.0 million aggregate
principal amount of 9 3/8% senior subordinated notes due 2007. The net proceeds
from the offering were used to repay amounts owed under the Credit Facility.

        During 1997, the Company issued $22.1 million in convertible
subordinated notes (the Notes) to former owners of certain of the Purchased
Companies as partial consideration of the acquisition purchase price. The Notes
bear interest, payable quarterly, at a weighted average interest rate of 5.3
percent and are convertible by the holder into shares of the Company's Common
Stock at a weighted average price of $37.31 per share. The Notes are redeemable
for cash or the Company's Common Stock at any time after one year of issuance.
The terms of the Notes require $12.1 million of principal payments in 1999 and
10.0 million of principle payments in 2000.

                                       12
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS --
                                   (CONTINUED)

5.      BUSINESS COMBINATIONS

    POOLINGS

        During 1996 and through the second quarter of 1997, the Company acquired
all of the outstanding stock of ten companies in exchange for 5,027,305 shares
of Common Stock. These companies provide motorcoach transportation and taxicab
services. These acquisitions have been accounted for as poolings-of-interests
and the results of operations of these ten companies are included for all
periods presented herein.

    PURCHASES

        During 1996 and through the second quarter of 1997, the Company
completed several acquisitions accounted for as purchases. The aggregate
consideration paid in these transactions consisted of $59.9 million in cash,
515,311 shares of Common Stock and $44.6 million of notes convertible into
1,336,827 shares of Common Stock. The accompanying balance sheet as of June 30,
1997 includes preliminary allocations of the respective purchase prices and are
subject to final adjustment. The preliminary allocations reflected liabilities
in excess of assets of $93.4 million, which has been recorded as Goodwill and is
being amortized over 40 years. Set forth below are unaudited pro forma combined
revenue and income data reflecting the pro forma effect of these acquisitions on
the Company's results of operations for the year ended December 31, 1996 and the
six months ended June 30, 1997. The unaudited data presented below consists of
the income statement data as presented in these condensed consolidated financial
statements plus (i) the income statement data of the Founding Companies for the
periods prior to June 1, 1997 and (ii) all Purchased Companies as if the
acquisitions were effective on the first day of the year being reported. The
revenue and net income data are in thousands.

                                                 Year Ended        Six Months
                                                 December 31,     Ended June 30,
                                                    1996               1997
                                                 -----------      --------------
Revenues......................................   $ 436,372          $ 222,162
Income before extraordinary items.............      18,025              9,199
Income per share before extraordinary items...        1.08                .48

        Pro forma adjustments included in the amounts above primarily relate to:
(a) reductions in former owners, and certain key employees, salary and benefits;
(b) adjustment to depreciation and amortization expense due to the purchase
price allocations; (c) adjustment to the federal and state income tax provisions
based on the combined operations; (d) elimination of historical interest expense
related to certain obligations converted to equity; (e) to record interest
expense on cash expended and the convertible subordinated notes issued in the
acquisitions of the Purchased Companies, and, for the year ended December 31,
1996, an adjustment to record interest expense on the senior subordinated notes
(the Notes), amortization of deferred financing costs and related taxes, as if
the Notes had been outstanding for the year.

        The pro forma results presented above are not necessarily indicative of
actual results which might have occurred had the operations and management teams
of the Company, the Founding Companies, the Pooled Companies and the Purchased
Companies been combined at the beginning of the periods presented.

                                       13
<PAGE>
                        COACH USA, INC. AND SUBSIDIARIES
             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS --
                                   (CONTINUED)

6.      COMMITMENTS AND CONTINGENCIES

    CLAIMS AND LAWSUITS

        The Company is subject to certain claims and lawsuits arising in the
normal course of business, most of which involve claims for personal injury and
property damage incurred in connection with its operations. The Company
maintains various insurance coverages in order to minimize financial risk
associated with the claims. The Company has provided for certain of these
actions in the accompanying interim condensed consolidated financial statements.
In the opinion of management, uninsured losses, if any, resulting from the
ultimate resolution of these matters will not be material to the Company's
financial position or results of operations.

    REGULATORY MATTERS

        The Surface Transportation Board ("STB") must approve or exempt any
consolidation or merger of two or more regulated interstate motorcoach operators
or the acquisition of one such operator by another. As of August 13, 1997, the
STB had exempted from regulatory approval requirements each of the acquisition
transactions involving federally-regulated interstate motorcoach operators
entered into by the Company through February 1997. There can be no assurance
that the Company will be able to obtain such approval or exemption with respect
to the acquisitions completed after February 1997 or future acquisitions.

    ESTIMATED INSURANCE CLAIMS PAYABLE

        The Company's operations include risks relating to bodily injury include
risks relating to property damage to third parties and workers' compensation.
The Company has commercial liability insurance policies that provide coverage by
the insurance company, subject to deductibles ranging from $5,000 to $250,000.
The Company is consolidating its insurance program under a program which
provides for deductibles ranging from $100,000 to $250,000. As such, any claim
within the deductible per incident would be the financial obligation of the
Company.

        The accrued insurance claims payable represents management's estimate of
the Company's potential claims costs in satisfying the deductible provisions of
the insurance policies for claims occurring through June 30, 1997. The accrual
is based on known facts and historical trends. Management believes such accrual
to be adequate.

    COLLECTIVE BARGAINING AGREEMENTS

        The Company is a party to various collective bargaining agreements with
certain of its employees. The agreements require the Company to pay specified
wages and provide certain benefits to its union employees. These agreements will
expire at various times through 2000.

                                       14
<PAGE>
                                 PART I, ITEM 2
                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

INTRODUCTION

        This filing contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements are based
on current plans and expectations of the Company and involve risks and
uncertainties that could cause actual future activities and results of
operations to be materially different from those set forth in the
forward-looking statements. Important factors that could cause actual results to
differ include, among others, risks associated with acquisitions, fluctuations
in operating results because of acquisitions and variations in stock prices,
changes in government regulations, competition, and risks of operations and
growth of the newly acquired businesses.

        Coach USA was founded in September 1995 to create a nationwide provider
of motorcoach and other ground transportation services. On May 17, 1996, Coach
USA acquired, simultaneously with the closing of the Initial Public Offering,
the six Founding Companies. Through the remainder of 1996, and through June 30,
1997, the Company completed the acquisition of several companies, some of which
have been accounted for as poolings-of-interest and some of which have been
accounted for as purchases. As a result, the pro forma combined financial
statements, including the pro forma combined results discussed below, include
the historical financial statements of each of the Founding Companies and the
Company (including the Pooled Companies) for all periods presented at historical
cost, as if these companies had always been members of the same operating group
and give effect to (i) the Compensation Differential; (ii) the elimination of
merger costs related to pooled acquisitions; (iii) certain tax adjustments
related to the taxation of certain Founding Companies and Pooled Companies as S
Corporations prior to the consummation of the mergers of the Founding Companies
and the subsequent acquisitions; and (iv) the tax impact of the Compensation
Differential in each period.

        The Company has begun to realize savings by consolidating certain
general administrative and purchasing functions and reducing insurance expenses.
In addition, the Company has begun to realize savings from its ability to borrow
at lower interest rates than the Founding Companies and the subsequent
acquisitions. These savings are being partially offset by the costs of being a
public company and the incremental increase in costs related to the Company's
new corporate management. Neither these savings nor the costs associated
therewith for the periods prior to the Initial Public Offering have been
included in the pro forma financial information discussed below. As a result,
pro forma results may not be comparable to, or indicative of, future
performance.

        The Company's motorcoach revenues are derived from fares charged to
individual passengers and fees charged under contracts to provide motorcoach
services. Taxicab operation revenues are derived from fees and other services
charged to independent taxicab operators. Operating expenses consist primarily
of salaries and benefits for motorcoach drivers and mechanics, depreciation,
maintenance, fuel, oil, insurance and commissions to agents. General and
administrative expenses consist primarily of compensation and related benefits
to the owners and certain key employees of the Founding Companies, the Pooled
Companies, and the Purchased Companies, administrative salaries and benefits,
marketing, communications and professional fees.

                                       15
<PAGE>
                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               CONDITION AND RESULTS OF OPERATIONS -- (CONTINUED)

RESULTS OF OPERATIONS -- PRO FORMA COMBINED (UNAUDITED)
<TABLE>
<CAPTION>
                                                                   THREE MONTHS ENDED                SIX MONTHS ENDED
                                                                         JUNE 30,                        JUNE 30,
                                                              ----------------------------    -----------------------------
                                                                      1996          1997              1996           1997
                                                              -------------  -------------    --------------   ------------
<S>                                                           <C>            <C>              <C>              <C>         
Revenues...............................................       $      77,430  $     119,083    $      139,214   $    199,329
Operating Expenses.....................................              58,612         87,322           109,062        150,893
                                                              -------------  -------------    --------------   ------------
     Gross Profit......................................              18,818         31,761            30,152         48,436
General and Administrative Expenses....................               7,812         11,923            15,797         21,703
Goodwill and Other Amortization........................                 122            813               234          1,342
Interest Expense.......................................               1,661          3,871             4,368          7,343
                                                              -------------  -------------    --------------   ------------
Income Before Income Taxes and Extraordinary Items                    9,223         15,154             9,753         18,048
Provision for Income Taxes.............................               3,765          6,203             4,050          7,380
                                                              -------------  -------------    --------------   ------------
Pro Forma Income Before Extraordinary Items                   $       5,458  $       8,951    $        5,703   $     10,668
                                                              =============  =============   ===============   ============
</TABLE>
      The pro forma combined results discussed below occurred when the combined
Founding Companies were under common control and management from June 1, 1996,
and the Pooled and Purchased Companies were under common control from the date
of their respective acquisitions. All other periods reflected were not under
common control or management and may not be comparable to, or indicative of,
future performance.

COMBINED RESULTS FOR THREE AND SIX MONTHS ENDED JUNE 1996 COMPARED TO 1997

      Revenues increased by 53.8% and 43.2% to $119.1 million and $199.3
million, respectively, for the three and six months ended June 30, 1997. The
increase in revenues was largely due to the revenues of the Purchased Companies
of $35.2 million and $49.9 million, respectively, for the three and six months
ended June 30, 1997.

      Operating expenses increased 49.0% and 38.4% to $87.3 million and $150.9
million for the three and six months ended June 30, 1997. The increase in
operating expenses was the result of the increased operations offset by savings
in the Company's insurance program and parts buying program.

      General and Administrative expenses, after elimination of the Compensation
Differential, and acquisition related costs increased 52.6% and 37.4% as
compared to the three and six months ended June 30, 1996, respectively. The
increase in general and administrative expenses in the six month period ended
June 30, 1997 was largely due to an increase of $1.7 million related to the
establishment of the corporate management group required to execute the
acquisition program and to manage the consolidated group of companies.

      Interest expense increased $2.2 million and $2.9 million as compared to
the three and six months ended June 30, 1996, due to the higher level of debt
related to additional equipment and debt related to the Purchased Companies,
partially offset by the repayment of debt through the use of proceeds of the
Initial Public Offering, a secondary offering of Coach USA common stock, and due
to lower rates from the credit facility.

                                       16
<PAGE>
                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               CONDITION AND RESULTS OF OPERATIONS -- (CONTINUED)

           Pro forma combined net income before extraordinary items, which has 
been adjusted for the Compensation Differential and the pro forma provision for
taxes, increased during the three and six months ended June 30, 1997 as compared
to the three and six months ended June 30, 1996 primarily due to continued
revenue growth and the effects of increased purchasing power on lowering certain
costs.

RESULTS OF OPERATIONS -- HISTORICAL (UNAUDITED)
<TABLE>
<CAPTION>
                                                                      THREE MONTHS ENDED               SIX MONTHS ENDED
                                                                           JUNE 30,                         JUNE 30,
                                                                  -------------------------       ----------------------------
                                                                     1996           1997              1996            1997
                                                                  -----------   -----------       -------------  -------------
<S>                                                               <C>           <C>               <C>            <C>          
Revenues...................................................       $    56,713   $   119,083       $      94,276  $     199,329
Operating Expenses.........................................            42,747        87,322              71,437        150,893
                                                                  -----------   -----------       -------------  -------------
     Gross Profit..........................................            13,966        31,761              22,839         48,436
General and Administrative Expenses........................             6,492        12,074              12,893         22,128
Goodwill Amortization......................................               122           813                 234          1,342
Acquisition Costs..........................................              --             231                --              348
Interest and Other.........................................             1,482         3,871               3,409          7,343
                                                                  -----------   -----------       -------------  -------------
Income Before Income Taxes and Extraordinary Items.........             5,870        14,772               6,303         17,275
Provision for Income Taxes.................................             2,598         6,153               2,638          7,208
                                                                  -----------   -----------       -------------  -------------
Income Before Extraordinary Items..........................       $     3,272   $     8,619       $       3,665  $      10,067
                                                                  ===========   ===========       =============  =============
</TABLE>
           The historical results discussed below occurred when the
combined Founding Companies were under common control and management from June
1, 1996, and the Pooled and Purchased Companies were under common control from
September 1, 1996. All other periods reflected were not under common control or
management and may not be comparable to, or indicative of, future performance.

HISTORICAL RESULTS FOR THREE AND SIX MONTHS ENDED JUNE 30, 1996 COMPARED TO 1997

           Revenues increased by 110.0% and 111.4% to $119.1 million and $199.3
million for the three and six months ended June 30, 1997 compared to the
comparable period in the prior year. The increase in revenues was largely due to
the revenues of the Founding Companies of $26.4 and $44.9 million and revenues
of the Purchased Companies of $35.2 and $49.9 million, and incremental increases
at certain Pooled Companies.

           Operating expenses increased 104.3% and 111.2% to $87.3 million and
$150.9 million for the three and six months ended June 30, 1997 compared to the
comparable period in the prior year. The increase in operating expenses was
directly related to increased revenues.

           General and Administrative expenses increased 86.0% and 71.6% as
compared to the three and six months ended June 30, 1996. The increase in
general and administrative expenses in the three and six month period ended June
30, 1997 was primarily due to the overall increase in operations and the
establishment of the corporate management group required to execute the
acquisition program and to manage the consolidated group of companies.

                                       17
<PAGE>
                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               CONDITION AND RESULTS OF OPERATIONS -- (CONTINUED)

           Interest expense increased $3.9 million as compared to the six months
ended June 30, 1996, due to the higher level of debt related to additional
equipment and debt related to the Purchased Companies, partially offset by the
repayment of debt through the use of proceeds of the Initial Public Offering, a
secondary offering of Coach USA common stock, and due to lower rates from the
credit facility.

           Net income increased during the three and six months ended June 30,
1997 as compared to the three and six months ended June 30, 1996 primarily due
to the acquisitions of the Founding Companies and Purchased Companies and the
effects of increased purchasing power on lowering certain costs.

EFFECTS OF COMBINATION

           Effective in the second quarter of 1996, the Company began incurring
expenses, including salaries for members of senior management and administrative
staff, travel and office expenses, related to the establishment of its corporate
and administrative infrastructure. Management believes that these additional
costs will be offset by operational efficiencies achieved through integration of
the operations of these companies. Specifically the Company expects insurance,
financing and benefits efficiencies to be derived as a result of the Company's
acquisition program.

LIQUIDITY AND CAPITAL RESOURCES -- PRO FORMA COMBINED

           Net cash provided by operating activities was $38.6 million for the
six months ended June 30, 1997. Capital expenditures during the period totaled
$67.7 million. The majority of the capital expenditures were for the purchase of
motorcoach equipment for fleet additions.

           In 1996, the Company completed the Initial Public Offering of
4,140,000 shares of Common Stock and a secondary offering of 2,084,307 shares of
Common Stock, resulting in net proceeds of approximately $96.6 million. The net
proceeds were used to pay the cash portion of the purchase price for the
Founding Companies, repay certain indebtedness assumed by the Company in the
Mergers and to repay amounts owed under the Credit Facility.

           In August 1997, the Company further amended and restated its credit
agreement (the "Credit Facility"). The Credit Facility agreement, as amended,
provides for a revolving credit facility of $300 million through a syndicate of
eight banks, and allows for an additional $80 million of debt (other than fully
subordinated debt) outside the credit facility. The Credit Facility is secured
by substantially all of the assets of the Company and matures in August 2000.
Interest on outstanding borrowings is charged, at the Company's option, at the
banks' prime rate plus up to .25% or the London Interbank Offered Rate ("LIBOR")
plus .50% to 1.75%, both as determined by the ratio of the Company's funded debt
to cash flow (as defined). A commitment fee ranging from 0.15% to 0.375% is
payable on the unused portion of the Credit Facility. Under the terms of the
Credit Facility, the Company must maintain certain minimum financial ratios. The
Credit Facility prohibits the payment of cash dividends. As of August 13, 1997,
the Company had a total of $105.8 million outstanding under the Credit Facility
and other outside credit facilities and had utilized $7.5 million of the
facility for letters of credit securing certain insurance obligations and
performance bonds, resulting in a borrowing availability of $266.7 million under
the Credit Facility.

           In June 1997, the Company completed the sale of $150.0 million
aggregate principal amount 9 3/8% senior subordinated notes due 2007. The net
proceeds from the offering were used to repay amounts owed under the Credit
Facility.

                                       18
<PAGE>
                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               CONDITION AND RESULTS OF OPERATIONS -- (CONTINUED)

           In exchange for all outstanding shares of stock of the Pooled
Companies together with certain real estate owned and conversion of certain debt
by the principals of such companies, the Company issued 5,452,344 shares of
Common Stock. In exchange for all outstanding shares of stock of the Purchased
Companies, the Company paid $242.4 million, comprised of $44.6 million in
convertible subordinated notes convertible into 1,336,827 shares of Common
Stock, 515,311 shares of Common Stock and $59.9 million in cash. Total debt
assumed by the Company in connection with these acquisitions was approximately
$155.7 million.

           Management believes that the Company's revolving credit facility, its
cash flows from operations, and shares of Common Stock available under its shelf
registration statement will provide sufficient liquidity or acquisition currency
to execute the Company's acquisition and internal growth plans for the next 12
months. Should the Company accelerate its acquisition program, the Company may
need to seek additional financing through the public or private sale of equity
or debt securities. There can be no assurance that the Company could secure such
financing if and when it is needed or on terms the Company deems acceptable.

                                       19
<PAGE>
                                 COACH USA, INC.
                           PART II - OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

          None

ITEM 2.   CHANGES IN SECURITIES

          None

ITEM 3.   DEFAULTS UPON SENIOR SECURITIES

          None

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

          The Company held its annual meeting of stockholders in Houston, Texas
on June 5, 1997. The following sets forth matters submitted to a vote of the
stockholders:

          (a)       The following individuals were elected to the Board of
                    Directors as stated in the Company's Proxy Statement dated
                    May 5, 1997, for terms expiring at the 2000 annual
                    stockholders' meeting or until their successors have been
                    elected and qualified - Class I Directors: Frank P.
                    Gallagher, Lawrence K. King, Thomas A. Werbe and William J.
                    Lynch.

                    Every Director was elected by a vote of 14,772,092 shares,
                    being more than a majority of the outstanding shares of
                    Common Stock of the Company, with 112,500 shares withheld.

          (b)       The stockholders approved the amended and restated
                    certificate of incorporation to increase the number of
                    authorized shares of Common Stock of the Company from
                    30,000,000 to 100,000,000 by a vote of 11,708,323 shares,
                    being more than a majority of the outstanding shares of
                    Common Stock of the Company, with 3,175,521 shares voted
                    against, 1,050 shares abstaining and 3,266,546 shares not
                    voted.

          (c)       The stockholders ratified the appointment of Arthur
                    Andersen, LLP to audit the financial statements of the
                    Company and its subsidiaries for the year 1997, by a vote of
                    14,844,881 shares, being more than a majority of the
                    outstanding shares of Common Stock of the Company, with
                    37,245 shares voted against, 2,768 shares abstaining and
                    3,266,546 shares not voted.

ITEM 5.   OTHER INFORMATION

          None

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

                                       20
<PAGE>
                                 COACH USA, INC.
                          PART II - OTHER INFORMATION--
                                   (CONTINUED)


          (a) Exhibits

                Exhibit 10.1 Credit Agreement Among Coach USA, Inc. as Borrower,
                The Financial Institutions named in this Credit Agreement as 
                Banks and NationsBank of Texas, N.A., as Agent for the Banks
                dated August 13, 1997.

                Exhibit 27.1 Financial Data Schedule

          (b) Reports on Form 8-K

              None.

                                       21
<PAGE>
                                    SIGNATURE

        Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant, Coach USA, Inc., has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                       COACH USA, INC.


Dated: August 14, 1997                 By:   /s/ LAWRENCE K. KING
                                       Name:     Lawrence K. King
                                       Title:    Senior Vice President and Chief
                                                 Financial Officer

                                       22
