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1. Place chicken in a plastic bag set in a shallow dish. For marinade, in a medium bowl stir together sherry, onion, lemon juice, bay leaves, and garlic. Pour over chicken; seal bag. Marinate in the refrigerator for 2 to 4 hours, turning bag occasionally. Drain chicken, reserving marinade. Cover and chill chicken until ready to grill.
2. For sauce, in a large saucepan combine the reserved marinade, the tomato puree, honey, molasses, salt, thyme, red pepper, and pepper. Bring to boiling. Reduce heat and simmer, uncovered, about 30 minutes or until reduced to 2 cups. Remove from heat; remove bay leaves. Stir in vinegar.
3. For a charcoal grill, arrange medium-hot coals around a drip pan. Test for medium heat above the pan. Place chicken pieces, bone sides down, on grill rack over drip pan. Cover and grill for 50 to 60 minutes or until tender and no longer pink, brushing with some of the sauce during the last 15 minutes of grilling. [For a gas grill, preheat grill. Reduce heat to medium. Adjust for indirect cooking. To serve, reheat and pass the remaining sauce with chicken. Makes 6 servings.