OSX VM running 10.10 on a machine running 10.12?
Yes - we do this sort of virtualization all the time at work. We use VMware Fusion, but Parallels is also quite good and some prefer it over Fusion.

Most people are licensed for non-commercial use of 2 virtual OS per copy when running on Mac hardware as part of the normal EULA:


https://www.apple.com/legal/sla/


For commercial purposes, you'll want to work with your legal and/or licensing team so they know what you've set up.