THE ACFT WAS FIRST OBSERVED IN A LEFT 30 DEG BANK TURN WITH THE NOSE SLIGHTLY DOWN. AFTER THE FIRST 360 DEG TURN, THE ANGLE OF BANK INCREASED TO 60 DEG. DURING THE 3RD 360 DEG TURN, THE DIAMETER OF THE TURN DECREASED TO ABOUT 100 FT & THEFORWARD SPEED APPEARED TO STOP. THE ACFT THE DROPPED OFF IN A LEFT WING DOWN SIDE-SLIP. AT 500 FT AGL THE BRS EXPLOSIVE CHARGE FIRED & THE PARACHUTE CANOPY OPENED TO ABOUT 3-5 FT DIAM. THE ACFT PITCHED FURTHER DOWN & THE BANK ANGLE INCREASED TO 70-80 DEG. THE PARACHUTE SEPARATED & THE ACFT SPIRALED TO THE GROUND. THE BRIDLE OF THE CHUTE WAS FOUND TO HAVE BEEN CUT BY A SHARP PIECE OF METAL NEAR ITS ATTACHMENT POINT. SUBSEQUENT TO THE ACCIDENT, THE PRODUCER OF THE ACFT ISSUED A SAFETY BULLETIN REQUIRING MODIFICAITONS. THE NOW-STANDARD LARGER SPAN CANARD IS TO BE INSTALLED IN ALL ACFT IN THE FIELD. A 3RD SLAT BRACKET IS TO BE INSTALLED ON ALL LEADING EDGE SLATS. RESTRICTOR LINES ARE TO INSTALLED TO LIMIT THE MAX TRAVEL OF THE RUDDERS. OWNERS INFORMED TO RESTRICT BANK TO 30 DEG UNTIL FLIGHT TESTS COMPLETED.