The FDIC issued Financial Institution Letter 66-2010 (“FIL-66-2010”) providing guidance on regulatory expectations with respect to applications to make permissible golden parachute payments. Golden parachute payments, i.e., certain types of termination payments to an institution-affiliated party (“IAP”) as defined by 12 C.F.R. Part 359 (“Part 359”), are subject to restrictions for “troubled” institutions (institutions with a composite rating of “4” or “5” or meeting other criteria) and their holding companies, even if such holding company is healthy. Part 359 provides certain exceptions to the restrictions on golden parachute payments. FIL-66-2010 clarifies the golden parachute application process for troubled institutions, specifies the type of information necessary to satisfy the certification requirements, and highlights factors considered by supervisory staff when determining whether to approve a golden parachute payment. Under the filing procedures set forth in FIL-66-2010, a troubled institution must demonstrate that: (1) the IAP has not committed any fraudulent act or omission, or breach of trust or fiduciary duty or insider abuse, that has had a material adverse effect on the institution or covered company; (2) the IAP is not “substantially responsible” for the insolvency or troubled condition of the institution or covered company; and (3) the IAP has not committed a violation of any applicable federal or state banking law that has had or is likely to have a material effect on the institution or covered company.