In a small saucepan combine sugar and ½ cup water. In the microwave or stove-top, heat another 1/3 cup of water and set aside.
Heat saucepan with sugar over medium heat and stir until sugar is dissolved. Then, stop stirring and allow mixture to boil, untouched, for about 10-12 minutes, until mixture turns a deep golden brown.
Turn off the heat and pour in the additional hot water- do this very quickly and carefully so that you do not burn yourself. Mixture will sputter and bubble up a bit and then settle down.
Stir until caramel becomes liquid-y. Set mixture aside to cool.
Meanwhile prepare a second bowl with shallots, soy sauce, fish sauce, and olive oil. When caramel sauce is cool to the touch, add the caramel sauce to the shallot mixture.
In marinating dish (or ziplock) add chicken and pour marinade over the meat.
Marinate for at least 1 hour and up to overnight.