01 - Preheat oven to 400°F. Line a baking sheet with parchment paper.
02 - In a large skillet, heat butter and olive oil over medium-low heat. Add the sliced onions, sugar, and salt. Cook, stirring occasionally, until the onions are deep golden and very soft, about 20 to 25 minutes. Stir in balsamic vinegar during the last few minutes if using, then set aside.
03 - Pat the chicken breasts dry and season both sides with salt, pepper, garlic powder, and paprika. Dredge each piece in flour, dip in beaten eggs, and coat thoroughly with a mixture of panko breadcrumbs and grated Parmesan.
04 - Heat olive oil in a large skillet over medium-high heat. Sear the breaded chicken for 2 to 3 minutes per side until golden brown. The chicken will not be cooked through at this stage. Transfer the seared chicken to the prepared baking sheet.
05 - Top each chicken breast with a generous spoonful of caramelized onions, then sprinkle evenly with shredded mozzarella and cheddar cheese.
06 - Bake for 15 to 18 minutes, or until the chicken is cooked through and the cheese is melted and bubbly.
07 - Garnish with chopped fresh parsley before serving.