Enter to open, tab to navigate, enter to select
10/12 limit
Practical Law ANZ Glossary w-010-3994 (Approx. 3 pages)
Glossary
10/12 limit
In the context of a share buy-back, a company should determine its 10/12 limit as follows:
- Total the following:
- the number of voting shares bought back during the 12 months before the date of the proposed buy-back; and
- the number of voting shares it intends to buy back under the proposed buy-back.
- Ascertain the number of votes attached to the above shares.
The 10/12 limit will be exceeded if the total number of votes attaching to the aggregate would exceed 10% of the smallest number, at any time during the last 12 months, of votes attaching to the voting shares of the company.
If the 10/12 limit is exceeded, the company's shareholders must approve the buy-back in general meeting. The exception to this is a selective buy-back, which requires shareholder approval regardless of whether or not it exceeds the 10/12 limit.
For more information, see Practice notes: