Exhibit 10.1 



July 20, 2006 



Mr. Thomas P. Mac Mahon
Chief
Executive Officer
Laboratory Corporation of
America Holdings
430 South Spring Street
Burlington, North Carolina 27215 




Dear Tom: 



        This
letter agreement confirms that the Nominating and Corporate Governance Committee and the
independent members of the Board of Directors have requested that you provide additional
services following the termination of your employment as Chief Executive Officer to assist
the Company during a transition period. This will also confirm that you have expressed a
willingness to provide those services subject to the terms and conditions set forth below: 



     1)    
          Employment: 



	 	
Effective
January 1, 2007 (the “Effective Date”), by mutual agreement, you will retire as
Chief Executive Officer of Laboratory Corporation of America Holdings (the
“Company”). As of the Effective Date, the Company agrees to engage you to serve
as a consultant to the Company in a non-employee capacity, and you agree to serve the
Company, during the Term, and subject to the terms and conditions, set forth in this
Letter Agreement. Nothing herein shall affect your service as a member of the Board of
Directors (the “Board”) or, at the pleasure of the Board, as Chairman thereof. 






     2)    
          Term: 



	 	
The
term of the transition assistance period shall begin on January 1, 2007 and continue for a
period of up to sixteen months. 






     3)    
          Duties: 



	 	
Your
duties shall include assisting the successor CEO during the transition assistance period;
providing consulting advice and assistance to the successor CEO in connection with Board
related matters; providing input and guidance in licensing matters including as
appropriate participating in meetings, introductions, and licensing visits; and other
matters as mutually agreed with the board. 






     3)    
          Time Commitment: 



	 	
You
would be expected to spend an average 6-8 days per month providing transition assistance. 






     4)    
          Office Expense Reimbursement: 



	 	
The
Company would reimburse you for forty percent of the cost of providing office space and
administrative support consistent with your current office and administrative support
during the term of the transition assistance. 






     5)    
          Travel and Entertainment Expenses: 



	 	
You
shall be reimbursed for reasonable business expenses, including travel and entertainment
expenses, incurred in connection with your performing services to the Company during the
term of the transition assistance. The Company’s normal reimbursement policies will
apply to these reimbursements. 






     6)    
          Compensation: 



	 	
In
addition to the compensation you may receive as a member of the Board of Directors, you
shall receive $12,500 per month for the consulting services provided in connection with
the Agreement. In addition, for purposes of determining your total retirement benefits
under the Company’s Retirement Plan and Pension Equalization Plan, five years shall
be added to your age at the time of your retirement (i.e. if you retire at the age of 60,
your retirement age for pension calculation purposes shall be 65). 






     7)    
          Transition Plan: 



	 	
This
Agreement is intended to be independent and in addition to the Senior Executive Transition
Plan Agreement and shall not amend or modify that Agreement which shall remain in full
force and effect. 






     8)    
          Termination: 



	 	
Either
party may terminate this Agreement upon 30 days prior written notice after the sixth month
of the term of this Agreement has been completed. This Agreement will terminate on your
death or your disability, which means your incapacity due to physical or mental illness
such that you are unable to perform the essential functions of your duties under this
Agreement; provided, however, that if your death or disability occurs in the first six
months of the term of this Agreement, the Company will continue to pay the compensation
provided in this Agreement to you or to your estate for the remainder of the six month
period. 






        The
Nominating and Corporate Governance Committee and the independent Board Members very much
appreciate your agreement to continue to provide the succession transition assistance
outlined above to help assure a smooth and successful CEO Succession Transition. Would you
please sign a copy of this letter in the space provided below to indicate your agreement
to the terms and conditions set forth above. 

	 	 	 	 	 
	 	

  Very truly yours,

 	 
	 	 	/s/Robert
E. Mittelstaedt, Jr.
 	 
	 	 	Robert
E. Mittelstaedt, Jr. 
Chairman,
Nominating and Corporate Governance Committee	 
	 	 	 	 
	 




AGREED AND ACCEPTED: 



/s/Thomas P. Mac Mahon
               

Thomas P. Mac Mahon