Cook pasta to al dente according to package directions.
Heat olive oil and butter over medium-low heat in a large pan. Add onions and cook for 15 minutes, stirring occasionally. Sprinkle with salt and sugar and cook another 15 minutes.
Add garlic and cook 1 minute.
Sprinkle flour over onions and stir to mix in. Turn heat up to medium. Cook 30 seconds and then gradually whisk in beef broth.
Add sherry, onion soup mix, half-and-half, and thyme and simmer until thickened.
Stir in chicken and cooked pasta.
Transfer to a lightly greased casserole dish. (If your pan is oven-proof, there's no need to transfer. Just sprinkle the cheese on top.) Sprinkle both cheeses on top.
Place casserole dish (or pan) in oven and broil until the cheese is melted and golden brown in spots.
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Notes
If you want to add some spice to this recipes, add a pinch or two of crushed red pepper flakes into onion mixture.