EX-10.1 FORM OF AIRCRAFT TIME SHARE AGREEMENT BETWEEN CEPHALON, INC. AND CERTAIN EXECUTIVE OFFICERS

EXHIBIT 10.1

FORM OF AIRCRAFT TIME SHARE AGREEMENT BETWEEN CEPHALON, INC. AND
CERTAIN EXECUTIVE OFFICERS

*       On November 1, 2006, Frank Baldino, Jr., Ph.D. entered into a Second Amended and Restated Aircraft Time Sharing Agreement that matches the form agreement attached hereto as Exhibit 10.1 in form and substance.

AIRCRAFT TIME SHARING AGREEMENT

THIS TIME SHARING AGREEMENT (this “Agreement”) is entered into on November  1, 2006 by Cephalon, Inc. (“Owner”), a Delaware corporation, with principal offices at 41 Moores Road, Frazer, PA 19355, and                . (“Lessee”).

BACKGROUND:

A.            Owner is the registered owner of certain civil aircraft as described in the Specification Sheet attached hereto and made a part hereof, as Exhibit A (the “Aircraft”).

B.            Owner employs a fully qualified flight crew to operate the Aircraft;

C.            From time to time, Lessee may desire to lease the Aircraft and flight crew from owner for Lessee’s personal travel at Lessee’s discretion on a time sharing basis as defined in Section 91.501(c)(1) of the Federal Aviation Regulations (“FAR”).

D.            This Agreement sets forth the understanding of the Parties as to the terms under which Owner will provide Lessee with the use, on a periodic basis, of the Aircraft; and

E.             The use of the Aircraft will at all times be pursuant to and in full compliance with the requirements of FAR Part 91 and particularly, Sections 91.501(b)(6), 91.501(c)(1), and 91.501(d).

NOW, THEREFORE, Owner and Lessee agree as follows:

1.             Subject to the terms and conditions of this Agreement, Owner agrees to lease the Aircraft to Lessee at Lessee’s discretion from time-to-time on a non-exclusive basis and on an “as needed and as available basis” pursuant to the provisions of FAR Section 91.501(b)(6), 91.501(c)(1), and 91.501(d) and to provide a fully qualified flight crew for all operations for flights scheduled in accordance with the terms of this Agreement.

2.             This Agreement shall remain in effect unless and until terminated by either party for any reason upon written notice to the other, such termination to become effective ten (10) days from the date of the notice or upon the earlier of (a) the termination of this Agreement by consent of Owner and Lessee, (b) the date of Lessee’s termination of employment with Owner and (c) the date of Lessee’s death.

3.             Lessee may use the Aircraft from time-to-time, subject to the prior permission and approval of Owner, for any and all purposes allowed by FAR Section 91.501(b)(6).  Lessee’s use shall include the use of the Aircraft by guests of the Company

if they accompany him or her on the flight.  Lessee shall not accept any compensation whatsoever for any flight conducted under this Agreement.

4.             In exchange for use of the Aircraft, Lessee shall pay the direct operating costs of the Aircraft permitted pursuant to FAR Section 91.501 for any flight conducted under this Agreement or a lesser amount as determined by Owner in its sole discretion.  Pursuant to FAR Section 91.501(d) as in effect from time to time, those direct operating costs shall be limited to the following expenses for each use of the Aircraft:

(a)           fuel, oil, lubricants and other additives;

(b)           travel expenses of the crew, including food, lodging and ground transportation;

(c)           hangar and tie down costs away from the Aircraft’s base of operation;

(d)           insurance obtained for the specific flight;

(e)           landing fees, airport taxes and similar assessments;

(f)            customs, foreign permit and similar fees directly related to the flight;

(g)           in-flight food and beverages;

(h)           passenger ground transportation;

(i)            flight planning and weather contract services; and

(j)            an additional charge equal to one hundred percent (100%) of the expenses listed in clause (a) above.

5.             Owner will provide to Lessee an invoice for each flight taken under this Agreement (plus any excise taxes described in Section 6 below). Lessee shall pay the amounts invoiced within fifteen (15) days after receipt of the related invoice.

6.             The Parties acknowledge that with the exception of the expenses for in-flight food and beverages and passenger ground transportation, the payment of expenses set forth in Section 4 hereof are subject to the federal excise tax imposed under Section 4261 of the Internal Revenue Code.  Lessee shall pay Owner for such expenses and the amount of such taxes within fifteen (15) days of receipt of the applicable invoice.  Owner agrees to collect and remit to the Internal Revenue Service for the benefit of Lessee all such federal excise taxes.

7.             In the event that Lessee desires to use the Aircraft pursuant to this Agreement, Lessee will so notify Owner and will provide Owner with requests for flight time and proposed flight schedules as far as possible in advance of any given flight. Requests for flight time shall be in a form, whether oral or written, mutually convenient to and agreed upon by Owner and Lessee. In addition to proposed schedules and flight times, Lessee shall provide at least the following information for each proposed flight at some time prior to scheduled departure as required by Owner or Owner’s flight crew:

(a)           departure point;

(b)           destinations;

(c)           date and time of flight;

(d)           the number and identity of any anticipated passengers;

(e)           the nature and extent of luggage and/or cargo to be carried;

(f)            the date and time of a return flight, if any; and

(g)           any other information concerning the proposed flight that may be pertinent or required by Owner or Owner’s flight crew.

8.             Owner shall have sole and exclusive authority over the scheduling of the Aircraft, including which aircraft is used for any particular flight.

9.             Owner shall be solely responsible for securing maintenance, preventive maintenance, and required or otherwise necessary inspections on the Aircraft and shall take such requirements into account in scheduling flights of the Aircraft.  No period of maintenance, preventive maintenance, or inspection shall be delayed or postponed for the purpose of scheduling the Aircraft, unless such maintenance or inspection can be safely conducted at a later time in compliance with all applicable laws and regulations, and within the sound discretion of the pilot-in-command. The pilot-in-command shall have final and complete authority to cancel any flight for any reason or condition that in his or her judgment would compromise the safety of the flight.

10.           Owner shall be responsible for the physical and technical operation of the Aircraft and the safe performance of all flights and shall retain full authority and control, including exclusive operational control, and possession of the Aircraft at all times during the term of this Agreement.  Owner shall employ, pay for, and provide to Lessee a qualified flight crew for each flight undertaken under this Agreement. In accordance with applicable FAR,