In a bid to broaden its Mezzanine market for development stage companies, the Bermuda Stock Exchange (BSX) yesterday amended the definition of a "Qualified Investor'' in its Listing regulations.

Until now, to meet the BSX requirements for a listing, an investor would not be qualified unless his investment was "not less than $100,000''.

The new regulations define a qualified investor as one who, having completed the BSX documentation, either invests not less than $100,000 or who otherwise meets one of the suitability tests set out in the declaration.

The suitability tests referred to in the new qualification language are based on net worth, annual income or net asset requirements.

The new requirements are modelled closely on the `accredited investor' tests set out in Rule 501 of regulation D of the regulations of the Securities & Exchange Council (SEC) in the United States.

BSX listing manager James McKirdy, explaining the reason for the amendment, said: "This new ruling gives the Exchange greater flexibility in listing securities and broadens the scope of securities suitable for listing under the provisions for Restricted Marketing.'' The new regulations, Mr. McKirdy said, will have the effect of making a BSX listing more attractive to international securities issuers.

BSX chief executive officer William Woods said: "Many growth companies raise capital through private placement to accredited investors in the United States and Europe. By tying our suitability declaration to the accredited investor tests for private placements, we can now enable a wide range of private equity to become publicly listed and traded on the BSX, an internationally recognised stock exchange, without the need for a full SEC registration.'' Mr. Woods continued: "A BSX listing on our Mezzanine market can thus form the perfect bridge between a company's private placement and eventual IPO.'' The exact wording of Regulation 1.7 of Section 1 of the Listing Regulations of the BSX states that a qualified investor is defined as "an investor who has truthfully completed an investor suitability declaration, in the form prescribed by the Exchange from time to time or in such other form as the Exchange may approve and either: (1) whose investment is not less than $100,000; or (2) who otherwise meets one of the suitability tests set out in the declaration.'' The BSX has released a Practice Note which sets out the form of Investor Suitability Declaration currently prescribed by the Exchange for this purpose.