EVERGREEN SELECT EQUITY TRUST, 485BPOS, 1998-10-30

EVERGREEN SELECT EQUITY TRUST
485BPOS, 1998-10-30

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1933 Act No. 333-36047
1940 Act No. 811-08363

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 6 [X]

and/or

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 6 [X]

EVERGREEN SELECT EQUITY TRUST

(Exact Name of Registrant as Specified in Charter)

200 Berkeley Street, Boston, Massachusetts 02116-5034
(Address of Principal Executive Offices)

(617) 210-3200
(Registrant's Telephone Number)

Michael H. Koonce, Esquire
200 Berkeley Street
Boston, Massachusetts 02116
(Name and Address of Agent for Service)

It is proposed that this filing will become effective:
[ ] immediately upon filing pursuant to paragraph (b)
[X] on November 1, 1998 pursuant to paragraph (b)
[ ] 60 days after filing pursuant to paragraph (a)(i)
[ ] on (date) pursuant to paragraph (a)(i)
[ ] 75 days after filing pursuant to paragraph (a)(ii)
[ ] on (date) pursuant to paragraph (a)(ii) of Rule 485

If appropriate, check the following box:
[ ] this post-effective amendment designates a new effective date for a
previously filed post-effective amendment
[ ] 60 days after filing pursuant to paragraph (a)(i)
[ ] on (date) pursuant to paragraph (a)(i)

<PAGE>
EVERGREEN SELECT EQUITY TRUST

CONTENTS OF POST-EFFECTIVE NO. 6 TO
REGISTRATION STATEMENT ON
FORM N-1A

This Post-Effective Amendment No. 6 to Registrant's Registration
Statement No. 333-36047/811-08363 consists of the following pages, items of
information and documents, together with the exhibits indicated in Part C as
being filed herewith.

Facing Sheet

Contents Page

Cross-Reference Sheet

PART A

Prospectuses for the Institutional Shares and Institutional Service Shares
of Evergreen Select Strategic Value Fund, Evergreen Select Diversified Value
Fund, Evergreen Select Large Cap Blend Fund, Evergreen Select Common Stock Fund,
Evergreen Select Strategic Growth Fund, Evergreen Select Equity Income Fund,
Evergreen Select Small Company Value Fund, Evergreen Select Social Principles
Fund, Evergreen Select Balanced Fund, Evergreen Select Equity Index Fund,
Evergreen Select Special Equity Fund and Evergreen Select Small Cap Growth Fund
are contained herein.

Prospectus for the Charitable Shares of Evergreen Select Large Cap Blend
Fund and Evergreen Select Social Principles Fund is contained herein.

Prospectus for the Class A and Class B Shares of Evergreen Select Equity
Index Fund is contained herein.

PART B

Statement of Additional Information for Evergreen Select Strategic Value
Fund, Evergreen Select Diversified Value Fund, Evergreen Select Large Cap Blend
Fund, Evergreen Select Common Stock Fund, Evergreen Select Strategic Growth
Fund, Evergreen Select Equity Income Fund, Evergreen Select Small Company Value
Fund, Evergreen Select Social Principles Fund, Evergreen Select Balanced Fund,
Evergreen Select Equity Index Fund, Evergreen Select Special Equity Fund and
Evergreen Select Small Cap Growth Fund is contained herein.

PART C

Exhibits

Number of Security Holders

Indemnification

Business and Other Connections
of Investment Advisors

Principal Underwriter

Location of Accounts and Records

Signatures

<PAGE>

EVERGREEN SELECT EQUITY TRUST

CROSS REFERENCE SHEET

Pursuant to Rule 481(a) under the Securities Act of 1993

ITEM OF PART A OF FORM N-1A LOCATION IN THE PROSPECTUS

Item 1. Cover Page Cover Page
Item 2. Synopsis and Fee Table Cover Page; Expenses
Item 3. Condensed Financial Information Financial Highlights
Item 4. General Description of Registrant Cover Page; Fund Descriptions
Item 5. Management of the Fund Fund Descriptions
Item 6. Capital Stock and Other Securities Fund Descriptions; Buying and
Selling Shares
Item 7. Purchase of Securities Being Offered Buying and Selling Shares
Item 8. Redemption or Repurchase Buying and Selling Shares
Item 9. Pending Legal Proceedings Not Applicable

LOCATION IN STATEMENT OF
ITEM IN PART B OF FORM N-1A ADDITIONAL INFORMATION

Item 10. Cover Page Cover Page
Item 11. Table of Contents Table of Contents
Item 12. General Information and History Trust Organization
Item 13. Investment Objectives and Policies Investment Policies
Item 14. Management of the Fund Investment Advisory and Other
Services; Management of the
Trust
Item 15. Control Persons and Principal Principal Holders of
Holders of Securities Fund Shares
Item 16. Investment Advisory and Other Services Investment Advisory and Other
Services
Item 17. Brokerage Allocation Brokerage
Item 18. Capital Stock and Other Securities Trust Organization
Item 19. Purchase, Redemption and Pricing of Purchase, Redemption and
Shares Pricing of Fund Shares
Item 20. Tax Status Additional Tax Information
Item 21. Underwriters Principal Underwriter
Item 22. Calculation of Performance Data Financial Highlights
Item 23. Financial Statements Financial Highlights

PART C

Information required to be included in Part C is set forth under the
appropriate item, so numbered, in Part C to this Registration Statement.

<PAGE>

EVERGREEN SELECT EQUITY TRUST

PART A

PROSPECTUSES
<PAGE>
<PAGE>

- -------------------------------------------------------------------------------
PROSPECTUS November 1, 1998
- -------------------------------------------------------------------------------

[LOGO OF EVERGREEN FUNDS APPEARS HERE]

EVERGREEN SELECT EQUITY TRUST
- -------------------------------------------------------------------------------

EVERGREEN SELECT STRATEGIC VALUE FUND
EVERGREEN SELECT DIVERSIFIED VALUE FUND
EVERGREEN SELECT LARGE CAP BLEND FUND
EVERGREEN SELECT COMMON STOCK FUND
EVERGREEN SELECT STRATEGIC GROWTH FUND
EVERGREEN SELECT EQUITY INCOME FUND
EVERGREEN SELECT SMALL COMPANY VALUE FUND
EVERGREEN SELECT SOCIAL PRINCIPLES FUND
EVERGREEN SELECT BALANCED FUND
EVERGREEN SELECT EQUITY INDEX FUND
EVERGREEN SELECT SPECIAL EQUITY FUND
EVERGREEN SELECT SMALL CAP GROWTH FUND
(EACH A "FUND," TOGETHER THE "FUNDS")

INSTITUTIONAL SHARES

This prospectus explains important information about the Institutional
Shares of the Evergreen Select Equity Trust, including information on how the
Funds invest and services available to shareholders. Please read this
prospectus before investing, and keep it for future reference.

When you consider investing in a Fund, remember that the higher the risk
of losing money, the higher the potential reward. The reverse is also
generally true: the lower the risk, the lower the potential reward.

By itself, no Fund is a complete investment plan. When considering an
investment in any of the Funds, remember to consider your overall investment
objectives and any other investments you own. You should also carefully
evaluate your ability to handle the risks posed by your investment in the
Funds. You can find information on the risks associated with investing in the
Funds under the section called "Fund Descriptions."

To learn more about the Evergreen Select Equity Trust, call 1-800-343-
2898 for a free copy of the Funds' statement of additional information ("SAI")
dated November 1, 1998, as supplemented from time to time. The Funds have
filed the SAI with the Securities and Exchange Commission ("SEC") and have
incorporated it by reference (legally included it) into this prospectus.

PLEASE REMEMBER THAT SHARES OF THE FUNDS ARE:

. NOT DEPOSITS OR OBLIGATIONS OF ANY BANK.

. NOT ENDORSED OR GUARANTEED BY ANY BANK.

. NOT INSURED OR OTHERWISE PROTECTED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER AGENCY.

SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL
AMOUNT.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

Keep This Prospectus For Future Reference.

EVERGREENSM is a Service Mark of Evergreen Asset Management Corp.
Copyright 1995, Evergreen Asset Management Corp.
<PAGE>

TABLE OF CONTENTS

<TABLE>
<S> <C>
EXPENSES................................ 3
FINANCIAL HIGHLIGHTS.................... 4
FUND DESCRIPTIONS....................... 10
Investment Objectives................ 10
Securities and Investment Practices.. 11
BUYING AND SELLING SHARES............... 15
How To Buy Shares.................... 15
How to Redeem Shares................. 15
Additional Transaction Policies...... 16
Exchanges............................ 16
Dividends............................ 17
Taxes................................ 17
Shareholder Services................. 17
FUND DETAILS............................ 18
Fund Organization and Service
Providers........................... 18
Other Information And Policies....... 21
Fund Performance..................... 22
</TABLE>

2
<PAGE>

- -------------------------------------------------------------------------------

EXPENSES

- -------------------------------------------------------------------------------

The tables and examples below are designed to help you understand the
various expenses that you will bear, directly or indirectly, when you invest
in the Funds. Shareholder transaction expenses are fees paid directly from
your account when you buy or sell shares of a Fund. There are no shareholder
transaction expenses.

Annual operating expenses reflect the normal operating expenses of a
Fund, and include costs such as management, distribution and other fees. The
table below shows the Funds' estimated annual operating expenses for the
fiscal period ending June 30, 1999. Each Fund's example shows what you would
pay if you invested $1,000 over the periods indicated. The examples assume
that you reinvest all of your dividends and that each Fund's average annual
return will be 5%. THE EXAMPLES ARE FOR ILLUSTRATION PURPOSES ONLY AND SHOULD
NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES OR ANNUAL
RETURN. THE FUNDS' ACTUAL EXPENSES AND RETURNS WILL VARY. For a more complete
description of the various costs and expenses borne by the Funds see "Fund
Details."

<TABLE>
<CAPTION>
ANNUAL FUND OPERATING
EXPENSES MANAGEMENT OTHER TOTAL OPERATING
(AS A PERCENTAGE OF FEES EXPENSES EXPENSES (AFTER
AVERAGE DAILY NET (AFTER EXPENSE 12B-1 (AFTER EXPENSE EXPENSE WAIVERS OR
ASSETS) WAIVERS)(1) FEES REIMBURSEMENTS) REIMBURSEMENTS)(1)
--------------------- -------------- ------- --------------- ------------------
<S> <C> <C> <C> <C>
Evergreen Select 0.60% None 0.15% 0.75%
Strategic Value Fund
Evergreen Select 0.50% None 0.18% 0.68%
Diversified Value Fund
Evergreen Select Large 0.58% None 0.13% 0.71%
Cap Blend Fund
Evergreen Select Common 0.53% None 0.17% 0.70%
Stock Fund
Evergreen Select 0.58% None 0.14% 0.72%
Strategic Growth Fund
Evergreen Select Equity 0.60% None 0.17% 0.77%
Income Fund
Evergreen Select Small 0.65% None 0.35% 1.00%
Company Value Fund
Evergreen Select Social 0.67% None 0.19% 0.86%
Principles Fund
Evergreen Select 0.50% None 0.20% 0.70%
Balanced Fund
Evergreen Select Equity 0.12% None 0.18% 0.30%
Index Fund
Evergreen Select Special 0.74% None 0.31% 1.05%
Equity Fund(2)
Evergreen Select Small 0.80% None 0.21% 1.01%
Cap Growth Fund
<CAPTION>
EXAMPLE OF FUND EXPENSES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- ------------------------ -------------- ------- --------------- ------------------
<S> <C> <C> <C> <C>
Evergreen Select $8 $24 $42 $ 93
Strategic Value Fund
Evergreen Select $7 $22 $38 $ 85
Diversified Value Fund
Evergreen Select Large $7 $23 $40 $ 88
Cap Blend Fund
Evergreen Select Common $7 $22 $39 $ 87
Stock Fund
Evergreen Select $7 $23 $40 $ 89
Strategic Growth Fund
Evergreen Select Equity $8 $25 $43 $ 95
Income Fund
Evergreen Select Small $10 $32 $55 $122
Company Value Fund
Evergreen Select Social $9 $27 $48 $106
Principles Fund
Evergreen Select $7 $22 $39 $ 87
Balanced Fund
Evergreen Select Equity $3 $10 $17 $ 38
Index Fund
Evergreen Select Special $11 $33 $58 $128
Equity Fund
Evergreen Select Small $10 $32 $56 $124
Cap Growth Fund
</TABLE>

- -------
(1) The investment advisor of each Fund, other than Evergreen Select Small Cap
Growth Fund, has voluntarily agreed to waive a portion of each Fund's
investment advisory fee. Without such waivers, each management fee set
forth above would be higher. The investment advisors currently intend to
continue this expense waiver indefinitely; however, each may modify or
cancel its expense waiver at any time. See "Fund Details" for more
information.
(2) The investment advisor of Evergreen Select Special Equity Fund has
undertaken to limit the Fund's Total Operating Expenses for a period of at
least two years to 1.82%.

Absent expense waivers and/or reimbursements, the Total Operating
Expenses for each of the Funds would be as follows:
<TABLE>
<CAPTION>
MANAGEMENT FEE OTHER EXPENSES (WITHOUT TOTAL FUND
FUND (WITHOUT WAIVERS) REIMBURSEMENTS) OPERATING EXPENSES
---- ----------------- ----------------------- ------------------
<S> <C> <C> <C>
Evergreen Select Strate-
gic Value Fund 0.70% 0.15% 0.85%
Evergreen Select Diver-
sified Value Fund 0.60% 0.18% 0.78%
Evergreen Select Large
Cap Blend Fund 0.70% 0.13% 0.83%
Evergreen Select Common
Stock Fund 0.70% 0.17% 0.87%
Evergreen Select Strate-
gic Growth Fund 0.70% 0.14% 0.84%
Evergreen Select Equity
Income Fund 0.70% 0.17% 0.87%
Evergreen Select Small
Company Value Fund 0.90% 0.35% 1.25%
Evergreen Select Social
Principles Fund 0.80% 0.19% 0.99%
Evergreen Select Bal-
anced Fund 0.60% 0.20% 0.80%
Evergreen Select Equity
Index Fund 0.40% 0.18% 0.58%
Evergreen Select Special
Equity Fund 1.50% 0.31% 1.81%
Evergreen Select Small
Cap Growth Fund 0.80% 0.21% 1.01%
</TABLE>

3
<PAGE>

- -------------------------------------------------------------------------------

FINANCIAL HIGHLIGHTS

- -------------------------------------------------------------------------------
The tables on the following pages present, for each Fund, financial
highlights for a share outstanding throughout each period indicated. The
information in the tables for Evergreen Select Strategic Value Fund, Evergreen
Select Diversified Value Fund, Evergreen Select Large Cap Blend Fund,
Evergreen Select Common Stock Fund, Evergreen Select Strategic Growth Fund,
Evergreen Select Equity Income Fund, Evergreen Select Social Principles Fund,
Evergreen Select Balanced Fund and Evergreen Select Small Cap Growth Fund has
been audited by KPMG Peat Marwick LLP, each Fund's independent auditors. A
report of KPMG Peat Marwick LLP on the audited information with respect to
each Fund is included in the Fund's Annual Report which is incorporated by
reference into the Funds' SAI. Evergreen Select Equity Index Fund and
Evergreen Select Special Equity Fund were formerly Equity Index Fund and
Special Equity Fund, respectively, portfolios of CoreFunds, Inc. They were
reorganized into Evergreen funds in July 1998. The information for Evergreen
Select Equity Index Fund and Evergreen Select Special Equity Fund for the
periods from November 1, 1995 to June 30, 1998 has been audited by Ernst &
Young LLP. The information for Evergreen Select Special Equity Fund for the
periods ended October 31, 1994 and October 31, 1995 has been audited by the
Funds' prior independent auditors. A report of Ernst & Young LLP on the
audited information with respect to each Fund is included in the Funds' Annual
Report which is incorporated by reference in the Fund's SAI. The Fund's Annual
Reports may be obtained without charge.

EVERGREEN SELECT STRATEGIC VALUE FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 203.35
--------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 1.60
Net realized and
unrealized gain on
investments............. 22.67
--------
Total from investment
operations.............. 24.27
--------
DISTRIBUTIONS TO
SHAREHOLDERS............
From net investment
income.................. (1.60)
--------
Total distributions...... (1.60)
--------
NET ASSET VALUE END OF
PERIOD.................. $ 226.02
========
TOTAL RETURN............. 11.95%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 0.75%+
Total expenses,
excluding indirectly
paid expenses.......... 0.75%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.85%+
Net investment income... 1.26%+
PORTFOLIO TURNOVER RATE.. 12%
AVERAGE COMMISSION RATE
PER SHARE............... $ 0.0619
NET ASSETS END OF PERIOD
(THOUSANDS)............. $287,194
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 23.81
--------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.14
Net realized and
unrealized gain on
investments............. 2.41
--------
Total from investment
operations.............. 2.55
--------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income.................. (0.14)
--------
Total distributions...... (0.14)
--------
NET ASSET VALUE END OF
PERIOD.................. $ 26.22
========
TOTAL RETURN............. 10.76%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 0.68%+
Total expenses,
excluding indirectly
paid expenses.......... 0.68%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.78%+
Net investment income... 1.24%+
PORTFOLIO TURNOVER RATE.. 56%
AVERAGE COMMISSION RATE
PER SHARE............... $ 0.0567
NET ASSETS END OF PERIOD
(THOUSANDS)............. $797,352
</TABLE>
- -------
+Annualized.
*For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.

EVERGREEN SELECT DIVERSIFIED VALUE FUND
- -------
+Annualized.
*For the period from January 22, 1998 (commencement of class operations) to
June 30, 1998.

4
<PAGE>

EVERGREEN SELECT LARGE CAP BLEND FUND
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 44.59
-------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.19
Net realized and
unrealized gain on
investments............. 6.18
-------
Total from investment
operations.............. 6.37
-------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income.................. (0.19)
In excess of net
investment income....... (0.03)
-------
Total distributions...... (0.22)
-------
NET ASSET VALUE END OF
PERIOD.................. $ 50.74
=======
TOTAL RETURN............. 14.31%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 0.71%+
Total expenses,
excluding indirectly
paid expenses.......... 0.71%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.83%+
Net investment income... 0.78%+
PORTFOLIO TURNOVER RATE.. 42%
AVERAGE COMMISSION RATE
PER SHARE............... $0.0591
NET ASSETS END OF PERIOD
(THOUSANDS)............. $14,032
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 82.97
-------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.51
Net realized and
unrealized gain on
investments............. 9.62
-------
Total from investment
operations.............. 10.13
-------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income.................. (0.51)
-------
Total distributions...... (0.51)
-------
NET ASSET VALUE END OF
PERIOD.................. $ 92.59
=======
TOTAL RETURN............. 12.23%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 0.70%+
Total expenses,
excluding indirectly
paid expenses.......... 0.70%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.82%+
Net investment income... 0.96%+
PORTFOLIO TURNOVER RATE.. 22%
AVERAGE COMMISSION RATE
PER SHARE............... $0.0573
NET ASSETS END OF PERIOD
(MILLIONS).............. $ 1,952
- -------
+Annualized.
*For the period from December 19, 1997 (commencement of class operations) to
June 30, 1998.

EVERGREEN SELECT COMMON STOCK FUND
</TABLE>
- -------
+Annualized.
*For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.

5
<PAGE>

EVERGREEN SELECT STRATEGIC GROWTH FUND
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 32.45
--------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income
(loss).................. 0.04
Net realized and
unrealized gain on
investments............. 5.96
--------
Total from investment
operations.............. 6.00
--------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income.................. (0.04)
--------
Total distributions...... (0.04)
--------
NET ASSET VALUE END OF
PERIOD.................. $ 38.41
========
TOTAL RETURN............. 18.53%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 0.72%+
Total expenses,
excluding indirectly
paid expenses.......... 0.72%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.84%+
Net investment income... 0.19%+
PORTFOLIO TURNOVER RATE.. 80%
AVERAGE COMMISSION RATE
PER SHARE............... $ 0.0595
NET ASSETS END OF PERIOD
(THOUSANDS)............. $321,532
</TABLE>
- -------
+Annualized.
*For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.

EVERGREEN SELECT EQUITY INCOME FUND
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 87.31
--------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 1.50
Net realized and
unrealized gain on
investments............. 1.73
--------
Total from investment
operations.............. 3.23
--------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income.................. (1.50)
In excess of net
investment income....... (0.01)
--------
Total distributions...... (1.51)
--------
NET ASSET VALUE END OF
PERIOD.................. $ 89.03
========
TOTAL RETURN............. 3.70%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 0.78%+
Total expenses,
excluding indirectly
paid expenses.......... 0.77%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.88%+
Net investment income... 2.80%+
PORTFOLIO TURNOVER RATE.. 51%
AVERAGE COMMISSION RATE
PER SHARE............... $ 0.0594
NET ASSETS END OF PERIOD
(THOUSANDS)............. $204,248
</TABLE>
- -------
+Annualized.
*For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.

6
<PAGE>

EVERGREEN SELECT SMALL COMPANY VALUE FUND
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 10.00
-------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.04
Net realized and
unrealized gain on
investments............. 0.09
-------
Total from investment
operations.............. 0.13
-------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income.................. (0.04)
-------
Total distributions...... (0.04)
-------
NET ASSET VALUE END OF
PERIOD.................. $ 10.09
=======
TOTAL RETURN............. 1.28%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 1.01%+
Total expenses,
excluding indirectly
paid expenses.......... 1.00%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 1.26%+
Net investment income... 0.68%+
PORTFOLIO TURNOVER RATE.. 23%
AVERAGE COMMISSION RATE
PER SHARE............... $0.0583
NET ASSETS END OF PERIOD
(THOUSANDS)............. $77,647
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 36.65
-------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.03
Net realized and
unrealized gain on
investments............. 2.32
-------
Total from investment
operations.............. 2.35
-------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income.................. (0.03)
In excess of net
investment income....... (0.01)
-------
Total distributions...... (0.04)
-------
NET ASSET VALUE END OF
PERIOD.................. $ 38.96
=======
TOTAL RETURN............. 6.41%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 0.86%+
Total expenses,
excluding indirectly
paid expenses.......... 0.86%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.99%+
Net investment income... 0.19%+
PORTFOLIO TURNOVER RATE.. 24%
AVERAGE COMMISSION RATE
PER SHARE............... $0.0585
NET ASSETS END OF PERIOD
(THOUSANDS)............. $ 2,405
</TABLE>
- -------
+Annualized.
* For the period from December 23, 1997 (commencement of class operations) to
June 30, 1998.

EVERGREEN SELECT SOCIAL PRINCIPLES FUND
- -------
+Annualized.
*For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.

7
<PAGE>

EVERGREEN SELECT BALANCED FUND
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $ 12.58
--------
INCOME FROM INVESTMENT
OPERATIONS
Net investment income.... 0.16
Net realized and
unrealized gain on
investments............. 0.81
--------
Total from investment
operations.............. 0.97
--------
DISTRIBUTIONS TO
SHAREHOLDERS
From net investment
income.................. (0.16)
--------
Total distributions...... (0.16)
--------
NET ASSET VALUE END OF
PERIOD.................. $ 13.39
========
TOTAL RETURN............. 7.76%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses.......... 0.70%+
Total expenses,
excluding indirectly
paid expenses.......... 0.70%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.80%+
Net investment income... 2.80%+
PORTFOLIO TURNOVER RATE.. 37%
AVERAGE COMMISSION RATE
PER SHARE............... $ 0.0597
NET ASSETS END OF PERIOD
(THOUSANDS)............. $723,850
</TABLE>
- -------
+ Annualized.
* For the period from January 22, 1998 (commencement of class operations) to
June 30, 1998.

EVERGREEN SELECT SMALL CAP GROWTH FUND
<TABLE>
<CAPTION>
YEAR ENDED FEBRUARY 28,
PERIOD ENDED -------------------------- PERIOD ENDED
JUNE 30, 1998*** 1998 1997** JUNE 30, 1996*
---------------- ----------- ------------ --------------
<S> <C> <C> <C> <C>
NET ASSET VALUE
BEGINNING OF PERIOD.... $ 13.23 $ 11.28 $ 11.65 $ 10.00
------- ----------- ----------- -------
INCOME (LOSS) FROM
INVESTMENT OPERATIONS
Net investment loss..... (0.03) (0.06)# (0.04)# (0.03)
Net realized and
unrealized gain (loss)
on investments......... (0.08) 2.48 (0.16) 1.68
------- ----------- ----------- -------
Total from investment
operations............. (0.11) 2.42 (0.20) 1.65
------- ----------- ----------- -------
DISTRIBUTIONS TO
SHAREHOLDERS
From net realized gain
on investments......... 0 (0.47) (0.17) 0
------- ----------- ----------- -------
Total distributions..... 0 (0.47) (0.17) 0
------- ----------- ----------- -------
NET ASSET VALUE END OF
PERIOD................. $ 13.12 $ 13.23 $ 11.28 $ 11.65
======= =========== =========== =======
TOTAL RETURN............ (0.83%) 21.67% (1.75%) 16.50%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET
ASSETS:
Total expenses......... 1.01%+ 0.92% 1.00%+ 1.00%+
Total expenses,
excluding indirectly
paid expenses......... 1.01%+ N/A N/A N/A
Total expenses,
excluding fee waiver
and expense
reimbursement......... N/A 0.95% 2.53%+ 2.81%+
Net investment loss.... (0.62%)+ (0.48%) (0.57%)+ (0.45%)+
PORTFOLIO TURNOVER
RATE................... 54% 166% 123% 57%
AVERAGE COMMISSION RATE
PER SHARE.............. $0.0406 $ 0.0493 $ 0.0509 $0.0847
NET ASSETS END OF PERIOD
(THOUSANDS)............ $69,283 $ 47,524 $ 2,888 $ 2,446
</TABLE>
- -------
+ Annualized.
* For the period from December 28, 1995 (commencement of class operations) to
June 30, 1996.
** For the eight-month period ended February 28, 1997. The Fund changed its
fiscal year end from June 30 to February 28, effective February 28, 1997.
*** For the period from March 1, 1998 to June 30, 1998. The Fund changed its
fiscal year end from February 28 to June 30, effective June 30, 1998.
# Net investment income (loss) is based on average shares outstanding during
the period.

8
<PAGE>

EVERGREEN SELECT EQUITY INDEX FUND*+
<TABLE>
<CAPTION>
YEAR ENDED JUNE 30
----------------------------------------------------------------------------
1998 1997 1996 1995 1994 1993 1992 1991(1)
-------- -------- -------- -------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $37.39 $28.47 $23.79 $20.54 $20.97 $19.22 $18.46 $19.48
-------- -------- -------- -------- ------- ------- ------- -------
Net Investment Income... 0.50 0.51 0.51 0.52 0.55 0.52 0.52 0.03
Realized and Unrealized
Net Gains (Losses) on
Securities............. 10.12 9.16 5.47 4.24 (0.43) 1.84 1.80 (0.94)
Distributions from Net
Investment Income...... (0.50) (0.51) (0.51) (0.52) (0.55) (0.52) (0.48) (0.02)
Distributions from
Capital Gains.......... (1.24) (0.24) (0.79) (0.99) -- (0.09) (1.08) (0.09)
-------- -------- -------- -------- ------- ------- ------- -------
Net Asset Value, End of
Period................. $46.27 $37.39 $28.47 $23.79 $20.54 $20.97 $19.22 $18.46
======== ======== ======== ======== ======= ======= ======= =======
TOTAL RETURN............ 29.17% 34.44% 25.69% 24.45% 0.55% 12.39% 12.59% (4.64)%++
Net Assets, End of
Period (000 omitted)... $315,920 $241,413 $166,350 $112,533 $72,552 $50,551 $20,166 $12,117
Ratio of Expenses to
Average Net Assets..... 0.38% 0.37% 0.35% 0.37% 0.35% 0.49% 0.57% 0.97%
Ratio of Net Income to
Average Net Assets..... 1.19% 1.63% 1.94% 2.48% 2.63% 2.82% 2.66% 1.79%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers).... 0.71% 0.71% 0.71% 0.76% 0.75% 0.88% 1.06% 1.20%
Ratio of Net Income to
Average Net Assets
(Excluding Waivers).... 0.86% 1.29% 1.59% 2.09% 2.23% 2.43% 2.17% 1.56%
Portfolio Turnover
Rate................... 12% 11% 13% 27% 13% 4% 27% --
Average Commission Rate
Paid(2)................ $0.0621(3) $0.0545 $0.0641 n/a n/a n/a n/a n/a
</TABLE>
- -------
* On April 22, 1996, the Series A Shares of the Fund were redesignated Class Y
Shares.
+ In July 1998, the Class Y Shares of Equity Index Fund, a portfolio of
CoreFunds, Inc., were reorganized into Institutional Shares of Evergreen
Select Equity Index Fund.
++ This figure has not been annualized.
(1) Commenced operations June 1, 1991. Unless otherwise noted, all ratios for
the period have been annualized.
(2) Presentation of the rate is only required for fiscal periods beginning
after September 1, 1995.
(3) Unaudited.

EVERGREEN SELECT SPECIAL EQUITY FUND*+
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31
---------------------
YEAR ENDED JUNE 30 INSTITUTIONAL PRIOR
--------------------------- CLASS CLASS
1998 1997 1996(3) 1995 1994(1)
------- ------- ------- ------------- -------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE, BEGINNING
OF PERIOD................ $11.27 $11.86 $11.42 $9.37 $10.00
------- ------- ------- ------- -------
Net Investment Income
(Loss)................... (0.05) 0.02 0.07 0.12 0.06
Realized and Unrealized
Net Gains (Losses) on
Securities............... 1.52 1.81 2.13 2.12 (0.63)
Distributions from Net
Investment Income........ -- (0.03) (0.07) (0.12) (0.06)
Distributions from Capital
Gains.................... (1.49) (2.39) (1.69) (0.07) --
------- ------- ------- ------- -------
Net Asset Value, End of
Period................... $11.25 $11.27 $11.86 $11.42 $9.37
======= ======= ======= ======= =======
TOTAL RETURN(2)........... 14.23% 17.94% 22.27% 24.44% (5.72)%
Net Assets, End of Period
(000 omitted)............ $73,981 $71,980 $63,680 $57,396 $10,069
Ratio of Expenses to
Average Net Assets....... 1.10% 0.84% 0.34% 0.32% 0.15%
Ratio of Net Income (Loss)
to Average Net Assets.... (0.48)% 0.19% 0.94% 1.14% 1.06%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers)...... 1.86% 1.82% 1.79% 1.97% 2.10%
Ratio of Net (Loss) to
Average Net Assets
(Excluding Waivers)...... (1.24)% (0.79)% (0.51)% (0.51)% (0.89)%
Portfolio Turnover
Rate**................... 62% 74% 72% 129% 39%
Average Commission Rate
Paid(4).................. $0.0628(5) $0.0257 $0.0539 n/a n/a
</TABLE>
- -------
* On February 21, 1995, the Shares of the Fund were redesignated as either
Retail or Institutional Shares. On that date, the Fund's net investment
income, expenses and distributions for the period November 1, 1994 through
February 20, 1995 were allocated to each class of Shares. The basis for the
allocation was the relative net assets of each class of Shares as of
February 21, 1995. The results were combined with the results of operations
and distributions for each applicable class for the period February 21, 1995
through October 31, 1995. For the year ended October 31, 1995, the Financial
Highlights' ratios of expenses, net investment income, total return, and the
per share investment activities and distributions reflect this allocation.
Also, on April 22, 1996, the assets of the Conestoga Special Equity Fund
were acquired by the Special Equity Fund, a series of CoreFunds, Inc. At
that time the Institutional Class Shares of the Fund were exchanged for
Class Y Shares.
** For the period ended June 30, 1996, transactions relating to the merger
were excluded from the calculation of the Portfolio Turnover Rate.
+ In July 1998, the Class Y Shares of Special Equity Fund, a portfolio of
CoreFunds, Inc., were reorganized into Institutional Shares of Evergreen
Select Special Equity Fund.
(1) Commenced operations March 15, 1994. Unless otherwise noted, all ratios
for the period have been annualized.
(2) Total return does not reflect applicable sales load. Additionally, total
return for the period ended June 30, 1996 is for an eight-month period.
(3) The per share amount for the period ended June 30, 1996 represents the
period from November 1, 1995 to June 30, 1996. All prior years are for the
period November 1 to October 31.
(4) Presentation of the rate is only required for fiscal periods beginning
after September 1, 1995.
(5) Unaudited.

9
<PAGE>

- -------------------------------------------------------------------------------

FUND DESCRIPTIONS

- -------------------------------------------------------------------------------

INVESTMENT OBJECTIVES

Each Fund's investment objective(s) is nonfundamental. As a result, a
Fund may change its objective(s) without a shareholder vote. Each Fund has
also adopted certain fundamental investment policies which are mainly designed
to limit a Fund's exposure to risk. A Fund's fundamental policies cannot be
changed without a shareholder vote. See the SAI for more information regarding
a Fund's fundamental investment policies or other related investment policies.

EVERGREEN SELECT STRATEGIC VALUE FUND seeks long-term capital
appreciation with current income as a secondary objective. The Fund invests
primarily in the equity securities of large companies (i.e., companies with
market capitalizations of over $5 billion at the time of investment) and mid-
size U.S. companies (i.e., companies with market capitalizations of over $1
billion but less than $5 billion at the time of investment). Generally
selected are stocks that the Fund's investment advisor believes are
undervalued relative to their true values and exhibit positive trends in their
underlying operations and earnings expectations.

EVERGREEN SELECT DIVERSIFIED VALUE FUND seeks long-term capital
appreciation with current income as a secondary objective. Normally, the Fund
invests primarily in equity securities of U.S. companies with prospects for
earnings growth and dividends. Generally selected are stocks that the Fund's
investment advisor believes are undervalued relative to their true values and
exhibit positive trends in their underlying operations and earnings
expectations.

EVERGREEN SELECT LARGE CAP BLEND FUND seeks to achieve long-term capital
growth. The Fund invests at least 65% of its total assets in the equity
securities of large companies. The Fund's stock selection is based on a
diversified style of equity management that allows it to invest in both value
and growth-oriented equity securities.

EVERGREEN SELECT COMMON STOCK FUND seeks long-term capital appreciation.
The Fund invests at least 65% of its total assets in common stocks of U.S.
companies. The Fund's stock selection is based on a diversified style of
equity management that allows it to invest in both value and growth-oriented
equity securities.

EVERGREEN SELECT STRATEGIC GROWTH FUND seeks long-term capital
appreciation. The Fund invests primarily in the equity securities of large and
mid-size U.S. companies, which, in the opinion of the Fund's investment
advisor, demonstrate the potential for superior and sustainable earnings
growth.

EVERGREEN SELECT EQUITY INCOME FUND seeks high current income as a
primary investment objective, and long-term capital appreciation as a
secondary objective. The Fund invests at least 65% of its total assets in
income producing equity securities that are generally characterized by having
below-average price to earnings ratios and higher dividend yields relative to
their industry groups. The Fund's stock selection is based on a diversified
style of equity management that allows it to invest in both value and growth-
oriented equity securities.

EVERGREEN SELECT SMALL COMPANY VALUE FUND seeks capital appreciation. The
Fund invests at least 65% of its total assets in the equity securities of
small companies (i.e., companies with market capitalizations of $1 billion or
less at the time of investment). The Fund invests in stocks of companies it
believes the market has temporarily undervalued in relation to such factors as
the company's assets, cash flow or earnings potential. The Fund's investment
advisor selects securities it thinks will rise in value sooner than most
observers anticipate, increasing the value of Fund shares.

EVERGREEN SELECT SOCIAL PRINCIPLES FUND seeks to provide long-term
capital growth. The Fund invests in the equity securities of mid-size
companies that respect human rights, play a role in local communities and
produce useful products in an environmentally sound way. The Fund will not
invest in companies that produce liquor, tobacco, weapons or nuclear energy.

EVERGREEN SELECT BALANCED FUND seeks long-term total return through
capital appreciation, dividends and interest income. The Fund invests in
growth oriented common and preferred stocks and fixed income

10
<PAGE>

securities to provide a stable income flow. It is anticipated that the
Evergreen Select Balanced Fund's asset allocation will range between 40-75% in
common and preferred stocks, 25-50% in fixed income securities (including some
convertible securities) and 0-25% in cash equivalents.

EVERGREEN SELECT EQUITY INDEX FUND seeks investment results that achieve
price and yield performance similar to the Standard & Poor's Corporation 500
Index ("S&P 500 Index"). The Fund invests primarily in stocks represented in
the S&P 500 Index.

EVERGREEN SELECT SPECIAL EQUITY FUND seeks capital growth. The Fund
strives to provide a return greater than stock market indices such as the
Russell 3000 Equal Weighted Index by investing principally in a diversified
portfolio of common stocks of domestic companies that its investment advisor
expects will experience growth in earnings and price including stocks of
companies with small market capitalizations (i.e., under $1 billion), medium
market capitalizations (i.e., between $1 billion and $5 billion) and large
market capitalizations (i.e., over $5 billion).

EVERGREEN SELECT SMALL CAP GROWTH FUND seeks to provide shareholders with
long-term growth of capital. Under normal circumstances, the Fund invests at
least 65% of its total assets in equity securities of companies with small
market capitalizations. Generally, the Fund intends to invest at least 80% of
its net assets in the stocks of companies with market capitalizations that are
generally less than $1 billion and more than $100 million ("small companies")
at the time of the Fund's investment. Companies whose capitalization falls
outside this range after the purchase continue to be considered small
companies for this purpose; however, the Fund intends to sell securities of
companies whose capitalizations fall below $50 million or rise above $2
billion.

SECURITIES AND INVESTMENT PRACTICES

You can find more information about the types of securities in which a
Fund may invest, the types of investment techniques a Fund may employ in
pursuit of its objective and a summary of related risks set forth below. The
Funds' SAI contains additional information about these investments and
investment techniques.

Equity Securities. Each Fund, with the exception of Evergreen Select Balanced
Fund, invests primarily in common stocks. A common stock represents an equity
(ownership) interest in a corporation. Each Fund expects to profit from stocks
primarily by (1) selling shares at a higher price than it paid and (2) earning
dividends.

Each Fund may invest in convertible securities. Convertible securities
are corporate securities that can be exchanged for a different type of
corporate security. Convertible securities normally purchased by the Funds are
convertible preferred stocks and convertible bonds, both of which can be
exchanged for common stocks.

Investments in stocks are subject to market risk, which is the
possibility that stock prices in general will decline over short or even
extended periods. Stock markets tend to move in cycles, with periods of rising
stock prices and periods of falling stock prices. Also, investing in small and
mid-sized companies involves greater risk than investing in larger companies.
Small and mid-sized company stock prices can rise very quickly and drop
dramatically in a short period of time. This volatility results from a number
of factors, including reliance by such companies on limited product lines,
markets, and financial and management resources. These and other factors may
make small and mid-sized companies more susceptible to setbacks or downturns.
These companies may experience higher rates of bankruptcy or other failures
than larger companies. They may be more likely to be negatively affected by
changes in management. In addition, the stock of small and mid-sized companies
may be less marketable than larger companies.

The Evergreen Select Equity Index Fund invests at least 90% of its total
assets in equity securities that represent a composite of the S&P 500 Index.
The S&P 500 Index consists of 500 common stocks, most of which are listed on
the New York Stock Exchange. In choosing the 500 stocks which are included in
the S&P 500 Index, S&P considers market values and industry diversification.
The correlation between the performance of the Fund and the S&P 500 Index is
expected to be, before expenses, 0.98 or higher. A correlation of 1.00 would
indicate perfect correlation.

11
<PAGE>

model that closely monitors the industry weightings of the S&P 500 Index.
Although the Fund's investment advisor does not screen securities by
traditional methods of financial and market analyses, it monitors the Fund's
investments with a view toward removing stocks of companies which exhibit
extreme financial distress or which may impair the Fund's ability to achieve
its investment objective. The Fund strives to provide a total return
comparable to the S&P 500 Index. Evergreen Select Equity Index Fund is not
sponsored by nor affiliated with S&P.

Foreign Investments. Evergreen Select Special Equity Fund may invest in
foreign securities, including securities of foreign issuers, securities issued
by foreign branches of U.S. banks and foreign banks, Canadian commercial paper
and Europaper (U.S. dollar-denominated commercial paper of foreign issuers),
American Depositary Receipts, European Depositary Receipts and Global
Depositary Receipts.

There are special risks associated with international investing:

. Currency Risk--The possibility that changes in foreign exchange
rates will affect, favorably or unfavorably, the value of foreign
securities.

. Volatility--Investments in foreign stock markets can be more
volatile than investments in U.S. markets. Diplomatic, political or
economic developments could affect investment in foreign countries.

. Expense Considerations--Fixed commissions on many foreign stock
exchanges are generally higher than negotiated commissions on U.S.
exchanges. Expenses for custodial arrangements of foreign securities
may be somewhat greater than typical expenses for custodial
arrangements for handling U.S. securities of equal value.

. Foreign Taxes--Certain foreign governments levy withholding taxes
against dividend and interest income. Although in some countries a
portion of these taxes are recoverable, the non-recovered portion of
foreign withholding taxes will reduce the income received from the
securities comprising the portfolio.

. Regulatory Environment--Foreign companies generally are not subject
to uniform accounting, auditing and financial reporting standards
comparable to those applicable to U.S. domestic companies. There is
generally less government regulation of securities exchanges,
brokers and listed companies abroad than in the U.S. Foreign
branches of U.S. banks, foreign banks and foreign issuers may be
subject to less stringent reserve requirements and to different
accounting, auditing, reporting and record keeping standards than
those applicable to domestic branches of U.S. banks and U.S.
domestic issuers.

Debt Securities. Evergreen Select Balanced Fund may invest in bonds or other
instruments used by corporations or governments to borrow money from
investors, including all kinds of convertible securities. When the Fund buys a
debt security, it expects to earn a variable or fixed rate of interest and it
expects the issuer to repay the amount borrowed at maturity. Some debt
securities, such as zero coupon bonds, do not pay current interest, but are
purchased at a discount from their face values. The main risks of investing in
debt securities are:

. Interest Rate Risk: The risk that a bond's prices will fall when
interest rates rise, and vice versa. Debt securities have varying
levels of sensitivity to interest rates. Longer-term bonds are
generally more sensitive to changes in interest rates than short
term bonds.

. Credit Risk: The chance that the issuer of a bond will have its
credit rating downgraded or will default (fail to make scheduled
interest and principal payments), potentially reducing the Fund's
income and/or share price.

Debt securities have varying degrees of quality. Investment grade bonds
are generally rated within the four highest grades as determined by Standard &
Poor's Rating Services ("S&P") (AAA, AA, or A), Moody's Investors Service Inc.
("Moody's") (Aaa, Aa, or A), or Fitch IBCA, Inc. ("Fitch") (AAA, AA, or A) or
their respective equivalent ratings or, if not rated or rated by another
system, determined by the Fund's advisor to be of equivalent credit quality to
securities so rated. Bonds rated A or above are regarded as having a strong
capacity to pay

12
<PAGE>

interest and repay principal. However, adverse economic conditions or changing
circumstances may lead to a weakened capacity to pay interest and repay
principal compared to higher-rated bonds.

The Fund is not required to sell or otherwise dispose of any security
that loses its rating or has its rating reduced after the Fund has purchased
it. Also, if S&P, Moody's or Fitch changes its ratings system, each Fund will
try to use comparable ratings as standards according to the Fund's investment
objectives and policies.

United States ("U.S.") Government Securities. U.S. government securities are
debt securities that are issued or guaranteed by the U.S. Treasury or by an
agency or instrumentality of the U.S. government. Some U.S. government
securities, such as Treasury bills, notes and bonds, are supported by the full
faith and credit of the U.S. Others, however, are supported only by the credit
of the instrumentality or by the right of the instrumentality to borrow from
the U.S. government.

While U.S. government securities are guaranteed as to principal and
interest, their market value is not guaranteed. Generally, U.S. government
securities are subject to the same interest rate and credit risks as other
fixed-income securities. However, since U.S. government securities are of the
highest credit quality, the credit risk is minimal. THE U.S. GOVERNMENT DOES
NOT GUARANTEE THE NET ASSET VALUE OF THE FUNDS' SHARES.

Mortgage-Backed Securities. A mortgage-backed security represents an interest
in a "pool" of commercial or residential mortgages. Payments of interest and
principal made by the individual borrowers on the mortgages that underlie the
securities are passed through to the Fund. Evergreen Select Balanced Fund may
invest in mortgage-backed securities and other complex asset backed
securities, including collateralized mortgage obligations and stripped
mortgage-backed securities.

Early repayment of the mortgages underlying the securities may expose the
Fund to a lower rate of return when it reinvests the principal. The rate of
prepayments will affect the price and volatility of the mortgage-backed
security and may have the effect of shortening or extending the effective
maturity beyond what a fund anticipated at the time of purchase.

Like other debt securities, changes in interest rates generally affect
the value of a mortgage-backed security. Additionally, some mortgage-backed
securities may be structured so that they may be particularly sensitive to
interest rates.

Derivatives. Derivatives are financial contracts whose value is based on an
underlying asset, such as a stock or a bond, or an underlying economic factor,
such as an index or an interest rate. Each Fund may purchase put and call
options, write covered put and call options, enter into futures contracts and
use options on futures contracts. The Funds may use futures and options for
hedging purposes only, not for speculation.

Losses from derivatives can sometimes be substantial. This is true partly
because small price movements in the underlying asset can result in immediate
and substantial gains or losses in the value of the derivative. Derivatives
can also cause a Fund to lose money if the Fund fails to correctly predict the
direction in which the underlying asset or economic factor will move. See
"Futures Transactions and Related Options Transactions" in the SAI.

Futures Contracts and Options Transactions. The Funds may buy and sell futures
and options on futures relating to, (i) individual securities; and (ii)
indices. Evergreen Select Special Equity Fund may also buy and sell futures
and options on futures relating to foreign currencies. Such transactions may
be entered into in order to hedge against declines in markets and to gain
exposure to markets prior to buying individual securities. Futures contracts
provide for the future sale by one party and purchase by another party of a
specified amount of a specified security at a specified future time and at a
specified price.

13
<PAGE>

These transactions are used to maintain cash reserves while remaining
fully invested, facilitate trading, reduce transaction costs or seek higher
investment returns when the contract is priced more attractively than the
underlying equity security or index.

The Funds may not use futures contracts or options transactions to
leverage their net assets for speculative purposes. See "Futures Transactions
and Related Options Transactions" in the SAI.

Borrowing. Each Fund may borrow from banks in an amount up to 33 1/3% of its
total assets, taken at market value. Each Fund may also borrow an additional
5% of its total assets from banks and others. A Fund may only borrow as a
temporary measure for extraordinary or emergency purposes such as the
redemption of Fund shares. A Fund may purchase additional securities so long
as borrowings do not exceed 5% of its total assets.

Securities Lending. To generate income and offset expenses, each Fund may lend
portfolio securities to broker-dealers and other financial institutions. Loans
of securities by a Fund may not exceed 33 1/3% of the value of the Fund's
total assets. While securities are on loan, the borrower will pay the Fund any
income accruing on the security. Also, the Fund may invest any collateral it
receives in additional securities.

Gains or losses in the market value of a lent security will affect a Fund
and its shareholders. When a Fund lends its securities, it runs the risk that
it could not retrieve the securities on a timely basis, possibly losing the
opportunity to sell the securities at a desirable price. Also, if the borrower
files for bankruptcy or becomes insolvent, a Fund's ability to dispose of the
securities may be delayed.

Repurchase Agreements. Each Fund may enter into repurchase agreements. A
repurchase agreement is an agreement by a Fund to purchase a security and sell
it back for a specified price. The repurchase price reflects an agreed-upon
interest rate for the time period of the agreement. A Fund's risk is the
inability of the seller to pay the agreed-upon price at delivery date.
However, such risk is tempered by the ability of a Fund to sell the security
in the open market in case of default. In such a case, a Fund may incur costs
in disposing of the security which would increase Fund expenses. A Fund's
investment advisor will monitor the creditworthiness of the firms with which
the Fund enters into repurchase agreements.

Reverse Repurchase Agreements. Each Fund may enter into reverse repurchase
agreements. A reverse repurchase agreement is an agreement by a Fund to sell a
security and repurchase it at a specified time and price. A Fund could lose
money if the market value of the securities it sold declines below their
repurchase price. Reverse repurchase agreements may be considered a form of
borrowing, and, therefore, a form of leverage. Leverage may magnify gains or
losses of a Fund.

Investing in Securities of Other Investment Companies. Each Fund may invest in
securities of other investment companies. As a shareholder of another
investment company, a Fund would pay its portion of the other investment
company's expenses. These expenses would be in addition to the expenses that a
Fund currently bears concerning its own operations and may result in some
duplication of fees.

When-Issued, Delayed-Delivery and Forward Commitment Transactions. Each Fund
may enter into transactions whereby it commits to buying a security, but does
not pay for or take delivery of the security until some specified date in the
future. The value of these securities is subject to market fluctuation during
this period and no income accrues to a Fund until settlement. At the time of
settlement, a when-issued security may be valued at less than its purchase
price. When entering into these transactions, a Fund relies on the other party
to consummate the transaction; if the other party fails to do so, the Fund may
be disadvantaged. Each Fund does not intend to purchase when-issued securities
for speculative purposes, but only in furtherance of its investment objective.

Temporary Defensive Investments. Each Fund may invest for temporary defensive
purposes up to 100% of its assets in short-term obligations. Such obligations
may include U.S. government securities, master demand notes, commercial paper
and notes, bank deposits and other financial institution obligations.

Other Investment Restrictions. Each Fund has adopted additional investment
restrictions and guidelines that are set forth in the SAI.

14
<PAGE>

- -------------------------------------------------------------------------------

BUYING AND SELLING SHARES

- -------------------------------------------------------------------------------

HOW TO BUY SHARES

Institutional investors may buy Institutional Shares of the Funds through
broker-dealers, banks and certain other financial intermediaries, or directly
through the Funds' distributor, Evergreen Distributor, Inc. ("EDI") Investors
may purchase Institutional Shares at the public offering price, which equals
the class' net asset value per share ("NAV"). See "Offering Price and Other
Purchase Information" below.

Minimum Investment. The minimum initial investment in Institutional Shares is
$1 million, which may be waived in certain situations. There is no minimum
amount required for subsequent purchases.

Opening an Account. You may open an account by mailing a signed account
application to the particular Fund c/o Evergreen Service Company, P.O. Box
2121, Boston, Massachusetts 02106-2121. You may get an account application by
calling 1-800-343-2898.

Except as provided below, you can only purchase shares by wiring federal
funds to Evergreen Service Company (the "Service Company"). You may obtain
wiring instructions by calling 1-800-343-2898. When you call, the Service
Company representative will ask you for the following information: name of
authorized person; shareholder name; shareholder account number; name of the
Fund and share class; amount being wired; and wiring bank name.

Offering Price and Other Purchase Information. When you buy a Fund's shares,
you pay its NAV next determined after the Fund receives and accepts your
order. To receive that day's offering price, a Fund must receive and accept
your order by the close of regular trading (currently 4:00 p.m. eastern time);
otherwise, you will receive the next day's offering price. For more
information, see "How the Funds Calculate Their NAV."

You may, at a Fund's discretion, pay for shares of a Fund with securities
instead of cash. Additionally, if you want to buy a Fund's shares equal in
amount to $5 million or more, the Fund may require you to pay for those shares
with securities instead of cash. A Fund will only accept securities that are
consistent with its investment objective, policies and restrictions. Also, a
Fund will value the securities in the manner described under "How the Funds
Calculate Their NAV." Investors who receive a Fund's shares for securities
instead of cash may pay such transaction costs as broker's commissions, taxes
or governmental fees.

HOW TO REDEEM SHARES

You may redeem shares of a Fund by mail, telephone or other types of
telecommunication. Once a redemption request has been telephoned, mailed or
otherwise transmitted, it may not be changed or cancelled.

Mail Redemptions. You may redeem shares on each day that the New York Stock
Exchange ("NYSE") is open by mailing a written request to the Service Company
at the following address:

Evergreen Service Company
P.O. Box 2121
Boston, Massachusetts 02106-2121

The signatures on the written request must be properly guaranteed, as
described below.

How To Redeem By Telephone. You may redeem your shares by calling 1-800-343-
2898 between the hours of 8:00 a.m. and 6:00 p.m. (eastern time) on each
business day. You may also redeem shares by sending a facsimile to 617-210-
2711 or by other means of wire communication. You must state the Fund and
class from which you want to redeem, the number or dollar amount of shares you
want to redeem and your account number. The telephone redemption service is
not available to you automatically. You must elect to do so on your account
application.

If you are unable to reach the Funds or the Service Company by telephone,
you should redeem by mail.

15
<PAGE>

The Service Company will wire your redemption proceeds to the commercial
bank account designated on the account application. If the Service Company
deems it appropriate, it may require additional documentation. Although at
present the Service Company pays the wire costs involved, it reserves the
right at any time to require the shareholder to pay such costs.

Redemption Value and Other Redemption Policies. When you sell shares, you
receive the NAV computed at the close of the NYSE on the day that a Fund
receives your request, if your request is received before 4:00 p.m. eastern
time. If a Fund receives your redemption request after 4:00 p.m. eastern time,
you will receive the next day's NAV. Generally, a Fund pays redemption
proceeds within seven days. The Funds may, at any time, change, suspend or
terminate any of the redemption methods described in this prospectus, except
redemptions by mail. For more information, see "How the Funds Calculate Their
NAV."

The Funds may, at their discretion, pay your redemption proceeds with
securities instead of cash. However, each Fund is obligated to redeem shares
solely in cash, up to the lesser of $250,000 or 1% of a Fund's total net
assets during any 90 day period for any one shareholder. See the SAI for
further details.

Except as otherwise noted, neither the Funds, the Service Company nor the
Funds' distributor assumes responsibility for the authenticity of any
instructions received by any of them from a shareholder by telephone. The
Service Company will employ reasonable procedures to confirm that instructions
received over the telephone or otherwise are genuine. Neither the Funds, the
Service Company nor the Funds' distributor will be liable when following
instructions received by telephone or otherwise that the Service Company
reasonably believes to be genuine.

Shareholders may only change information contained in their account
registration (such as the bank account designated to receive wire redemption
proceeds) by writing to the Service Company. Signatures on such written
instructions must be guaranteed, as described below.

ADDITIONAL TRANSACTION POLICIES

How The Funds Calculate Their NAV. A Fund's NAV equals the value of its shares
without sales charges. A Fund calculates its NAV by adding up the total value
of its investments and other assets, subtracting its liabilities and then
dividing the result by the number of shares outstanding. The Funds compute
their NAV as of the close of regular trading (generally 4:00 p.m. eastern
time) on each day that the NYSE is open.

The Funds' assets are valued primarily on the basis of market quotations.
Short-term securities with remaining maturities of 60 days or less are valued
on the basis of amortized cost. In addition, securities for which quotations
are not readily available or do not reflect current market value are valued by
a method that the Board of Trustees believes accurately reflects fair value.

Signature Guarantee. For your protection, signatures on stock powers, and
written orders or authorizations must have a signature guarantee. A signature
guarantee can be provided by a U.S. stock exchange member, a bank, or other
persons eligible to guarantee signatures under the Securities Exchange Act of
1934 and the Service Company's policies. The Service Company may waive this
requirement or may require additional documentation in certain cases.

EXCHANGES

You may exchange Institutional Shares of any Fund for Institutional
Shares of any other Evergreen Select fund. You may exchange your shares
through your broker-dealer, by mail or by telephone. All exchange orders must
comply with the applicable requirements for purchases and redemptions and must
include your account number, the number or value of shares to be exchanged,
the class of shares, and the funds to and from which you wish to exchange.

Signatures on exchange orders must be guaranteed, as described above.

The Funds reserve the right to change or revoke the exchange privilege of
any shareholder or to limit or revoke any exchange. Currently, you may not
make more than five exchanges in a year or three exchanges in a calendar
quarter.

16
<PAGE>

Please read the prospectus of the fund that you want to exchange into
before requesting your exchange.

For federal income tax purposes, an exchange is treated as a sale for
taxable investors.

DIVIDENDS

As a shareholder, you are entitled to your share of earnings on a Fund's
investments. You receive such earnings as either an income dividend or a
capital gains distribution. Income dividends come from the dividends that a
Fund earns from its stocks plus any interest it receives from its bonds. A
Fund realizes a capital gain whenever it sells a security for a higher price
than its tax basis.

Dividend Schedule. Each Fund declares and pays dividends from its net
investment income monthly. Each Fund pays shareholders its net capital gains
at least once a year.

Payment Options. Unless you select another option on your account application,
your dividends and capital gains will be reinvested in additional shares of
the same class of the same Fund.

You may elect to receive some or all of your dividends and capital gains
in cash. Should you select this option, a check will be mailed to you or your
agent or trustee no later than seven days after the payment date.

TAXES

Each Fund has qualified and intends to continue to qualify as a regulated
investment company (a "RIC") under Subchapter M of the Internal Revenue Code
of 1986, as amended (the "Code"). As long as a Fund qualifies as a RIC and
distributes substantially all of its net investment income and capital gains,
it will not pay federal income taxes on the earnings it distributes to
shareholders.

Distributions to shareholders, whether taken in cash or reinvested in
shares, are generally considered taxable for federal income tax purposes as
follows:

. Income distributions and net short-term capital gains distributions
are taxable as ordinary income.

. Long-term capital gains distributions are taxable as capital gains,
regardless of how long you have held your shares.

After each calendar year, the Service Company will mail you a statement
indicating which of that year's distributions you should treat as ordinary
income and which you should treat as capital gains. Distributions of income or
capital gains may also be subject to state and local taxes. You should always
consult your tax advisor for specific guidance as to the tax consequences of
your investment in the Funds.

SHAREHOLDER SERVICES

Details on all shareholder services may be obtained from the Service
Company by calling toll-free 1-800-343-2898 or by writing to the Service
Company.

Subaccounts. Special processing has been arranged with the Service Company for
banks and other institutions that wish to open multiple accounts (a master
account and subaccounts). An investor wishing to avail himself or herself of
the Service Company's subaccounting facilities will be required to enter into
a separate agreement, with the charges to be determined on the basis of the
level of services to be rendered. Subaccounts may be opened with the initial
investment or at a later date and may be established by an investor with
registration either by name or by number.

17
<PAGE>

- -------------------------------------------------------------------------------

FUND DETAILS

- -------------------------------------------------------------------------------

FUND ORGANIZATION AND SERVICE PROVIDERS

Fund Structure. Each Fund is an investment pool, which invests shareholders'
money towards a specified goal. Each Fund is a diversified series of an open-
end management investment company, called "Evergreen Select Equity Trust" (the
"Trust"). The Trust is a Delaware business trust organized on September 18,
1997.

Board of Trustees. The Trust is supervised by a Board of Trustees that is
responsible for representing the interests of shareholders. The Trustees meet
periodically throughout the year to oversee each Fund's activities, reviewing,
among other things, its performance and its contractual arrangements with
various service providers.

Shareholder Rights. All shareholders have equal voting, liquidation and other
rights. Each share is entitled to one vote for each dollar of NAV applicable
to such share. Shareholders may exchange shares as described under
"Exchanges," but will have no other preference, conversion, exchange or
preemptive rights. When issued and paid for, shares will be fully paid and
nonassessable. Shares of the Funds are redeemable, transferable and freely
assignable as collateral. The Trust may establish additional classes or series
of shares.

The Funds do not hold annual shareholder meetings; a Fund may, however,
hold special meetings for such purposes as electing or removing Trustees,
changing fundamental policies and approving investment advisory agreements or
12b-1 plans. In addition, the Funds are prepared to assist shareholders in
communicating with one another for the purpose of convening a meeting to elect
Trustees.

Advisors. The investment advisor to each Fund, other than the Evergreen Select
Small Company Value Fund, Evergreen Select Special Equity Fund and Evergreen
Select Small Cap Growth Fund, is First Union National Bank ("FUNB"), a
subsidiary of First Union Corporation ("First Union"). First Union is located
at 301 South College Street, and FUNB at 201 South College Street, Charlotte,
North Carolina 28288-0630. First Union and its subsidiaries provide a broad
range of financial services to individuals and businesses throughout the U.S.

Each Fund, other than the Evergreen Select Small Company Value Fund,
Evergreen Select Special Equity Fund and Evergreen Select Small Cap Growth
Fund, pays FUNB a fee for its services as set forth below. FUNB annual
advisory fees are expressed as a percentage of average net assets. In
addition, FUNB has voluntarily agreed to reduce its advisory fee for each Fund
it advises, resulting in the net advisory fees that are also indicated in the
table below.

<TABLE>
<CAPTION>
FUND ADVISORY FEE NET ADVISORY FEE
---- ------------ ----------------
<S> <C> <C>
Evergreen Select Strategic Value Fund 0.70% 0.60%
Evergreen Select Diversified Value Fund 0.60% 0.50%
Evergreen Select Large Cap Blend Fund 0.70% 0.58%
Evergreen Select Common Stock Fund 0.70% 0.53%
Evergreen Select Strategic Growth Fund 0.70% 0.58%
Evergreen Select Equity Income Fund 0.70% 0.60%
Evergreen Select Social Principles Fund 0.80% 0.67%
Evergreen Select Balanced Fund 0.60% 0.50%
Evergreen Select Equity Index Fund 0.40% 0.12%
</TABLE>

Evergreen Asset Management Corp. ("Evergreen Asset") is the investment
advisor to Evergreen Select Small Company Value Fund. Evergreen Asset is
located at 2500 Westchester Avenue, Purchase, New York 10577 and is also a
subsidiary of First Union. Evergreen Select Small Company Value Fund pays
Evergreen Asset an annual advisory fee equal to 0.90% of average net assets.
Currently, Evergreen Asset has voluntarily agreed to limit its advisory fee to
0.80% of the average net assets of the Fund.

The investment advisor of Evergreen Select Special Equity Fund is
Meridian Investment Company ("Meridian"). Meridian is an indirect subsidiary
of FUNB. Meridian's address is 55 Valley Stream Parkway, Malvern, Pennsylvania
19355. Meridian receives an annual fee equal to 1.50% of average daily net
assets of Evergreen Select Special Equity Fund. Currently Meridian has
voluntarily agreed to limit its advisory fee to 0.74% of the average net
assets of the Fund.

18
<PAGE>

Evergreen Investment Management Company ("EIMC") (formerly known as
Keystone Investment Management Company) is the investment advisor to Evergreen
Select Small Cap Growth Fund. EIMC is located at 200 Berkeley Street, Boston,
Massachusetts 02116-5034, and is an indirect wholly-owned subsidiary of FUNB.

Evergreen Select Small Cap Growth Fund pays EIMC a fee for its services
as set forth below. Annual advisory fees are expressed as a percentage of
average net assets.

<TABLE>
<CAPTION>
AGGREGATE
NET ASSET VALUE
OF THE SHARES
MANAGEMENT FEE OF THE FUND
-------------- ------------------
<S> <C>
0.80% of the first $100,000,000, plus
0.75% of the next $150,000,000, plus
0.65% of amounts over $250,000,000
</TABLE>

FUNB, Evergreen Asset and Meridian currently intend to continue
indefinitely waiving a portion of each Fund's respective advisory fee where
applicable. FUNB, Evergreen Asset and Meridian may each modify or cancel its
expense waiver at any time.

Sub-Advisor. With respect to Evergreen Select Small Company Value Fund,
Evergreen Asset has entered into a sub-advisory agreement with Lieber &
Company. Under that agreement, Lieber & Company furnishes Evergreen Asset with
information, investment recommendations, advice and assistance. Evergreen
Asset reimburses Lieber & Company for the direct and indirect costs it incurs
while performing its sub-advisory services. Lieber & Company is located at
2500 Westchester Avenue, Purchase, New York, 10566. Lieber & Company is an
indirect, wholly-owned, subsidiary of First Union.

Portfolio Managers. Information about the individual portfolio managers
responsible for managing each Fund, including their occupations for the past
five years, is provided below.

Hanspeter Giger, CFA. Hanspeter Giger has 13 years of
investment management experience. He joined FUNB as an
Equity Analyst in 1987. For the past five years, Mr.
Giger has been Director of Equity Research,
responsible for overseeing and coordinating FUNB's
Investment Research/Core Team, in addition to co-
managing the Fund.

Evergreen Select Equity Paul A. DiLella. Paul A. DiLella is a Vice President,
Income Fund Analyst and Fund Manager of FUNB. Aside from managing
the Fund, Mr. DiLella has been the fund co-manager of
the Evergreen Utility Fund since 1996. Mr. DiLella
also has research responsibilities for the electric
utility, real estate investment trust and natural gas
distribution companies. Mr. DiLella joined First
Fidelity Bank in 1982, which was acquired by FUNB in
1995, as Vice President and Portfolio Manager of the
Asset Management Group. Mr. DiLella has over 17 years
of investment experience.

Evergreen Select Large Eric M. Wiegand. Eric Wiegand has managed the Fund
Cap Blend Fund since 1996 and is assisted by a team of seasoned
investment professionals. Mr. Wiegand is a Senior Vice
President and Senior Portfolio Manager, also
responsible for managing the Evergreen Select Social
Principles Fund. Prior to rejoining First Fidelity
Bank in 1994, which was acquired by FUNB in 1995, Mr.
Wiegand was an Assistant Vice President and Portfolio
Manager with First Fidelity Bank from 1989-1993.
</TABLE>

19
<PAGE>

<TABLE>
<CAPTION>
FUND PORTFOLIO MANAGER(S)
---- --------------------
<C> <S>
Evergreen Select Social Mr. Wiegand also acts as portfolio manager of the
Principles Fund Evergreen Select Large Cap Blend Fund.

Evergreen Select W. Shannon Reid, CFA. Shannon Reid has over 14 years
Strategic Growth Fund of investment experience. His responsibilities include
equity analysis and portfolio management for FUNB's
growth-style equity products. Mr. Reid has been with
FUNB since 1988 as a Vice President and Portfolio
Manager.

Timothy M. Stevenson, CFA. Tim Stevenson has over 17
years of investment experience. Mr Stevenson joined
FUNB in 1994 as a Senior Vice President and Portfolio
Manager.

Evergreen Select Timothy O'Grady is the team leader of a group of
Strategic Value Fund seasoned professionals who manage the Strategic Value
Fund.

Timothy E. O'Grady. Since joining FUNB (then First
Fidelity Bank) in 1986, Timothy O'Grady has been a
portfolio manager in the Employee Benefit
Equity/Balanced Unit of the Capital Management Group
in Newark, NJ. Mr. O'Grady is a Senior Vice President
and Senior Portfolio Manager and also co-manages the
Evergreen Select Value Fund.

Evergreen Select Stephen A. Lieber. Stephen Lieber is Chairman and Co-
Small Company Chief Executive Officer of Lieber & Company and
Value Fund Evergreen Asset. He was the founding Partner of Lieber
& Company in 1969 and served as Senior Partner until
June, 1994. He is Portfolio Manager of Evergreen Fund,
Evergreen Foundation Fund, Evergreen Tax Strategic
Foundation Fund, Evergreen VA Foundation Fund and
Evergreen VA Fund.

Peter J. Kovalski, CFA. Peter Kovalski joined Lieber &
Company as an analyst in 1992.
Nola M. Falcone, CFA. Nola Falcone is President and
Co-Chief Executive Officer of Lieber & Company and
Evergreen Asset. Ms. Falcone was a General Partner of
Lieber & Company from January, 1981 to June, 1994. She
is Portfolio Manager for Evergreen Income & Growth
Fund, Evergreen Small Cap Equity Income Fund and
Evergreen VA Small Cap Equity Income Fund.

Evergreen Select Dean Hawes. Dean Hawes has over 23 years of investment
Balanced Fund experience. Since joining FUNB from Merrill Lynch in
1981, Mr. Hawes has been a Vice President and Senior
Portfolio Manager.

Rollin C. Williams, CFA. Rollin Williams has over 29
years of investment and banking management experience.
In addition to managing FUNB's Diversified Bond Group
Trust and the Evergreen U.S. Government Fund, he is
also responsible for the management of over $2.2
billion in fixed income portfolios. Since joining FUNB
in 1993, Mr. Williams has been a Vice President and
Senior Portfolio Manager.

Evergreen Select Eric M. Teal. Mr. Teal, Vice President and
Diversified Quantitative Equity Analyst, joined FUNB in September
Value Fund 1993 and currently heads the Quantitative
Analysis/Portfolio Management Unit within FUNB. He
began managing the Diversified Value Fund in June
1998, and is also responsible for risk analysis and
quantitative management for other Evergreen Select
Equity Funds.

Evergreen Select Leonard Capristo. Mr. Capristo has 27 years of
Equity Index Fund investment experience and currently manages FUNB's
Enhanced Stock Market Fund. He joined FUNB in 1989 as
the Director of Equity Trading. He rejoined the
Capital Management Group in 1997 from First Union's
Capital Markets Group where he served as co-manager of
public equity investments for three years.
</TABLE>

20
<PAGE>

<TABLE>

<CAPTION>
FUND PORTFOLIO MANAGER(S)
---- --------------------
<C> <S>
Evergreen Select Joseph E. Stocke, CFA. Mr. Stocke has been a Senior
Special Equity Fund Investment Manager/Equities with Meridian since 1990.
Mr. Stocke has been with Meridian since 1983 and prior
to July 1998 managed the Special Equity Fund and Core
Equity Fund of CoreFunds, Inc.

Evergreen Select Small Thomas Holman. Mr. Holman has been the Portfolio
Cap Growth Fund Manager of the Fund since joining EIMC in January,
1997. Prior to joining EIMC, Mr. Holman was an
investment officer and securities analyst at Invista
Capital Management, Inc. ("Invista"), Des Moines, Iowa,
from 1993 to 1997. Mr. Holman manages the Fund in
conjunction with the EIMC Small Cap Growth Team is
headed by J. Gary Craven, a EIMC Senior Vice President.
Prior to joining EIMC in 1996, Mr. Craven was Vice
President and Portfolio Manager of Invista. He joined
Invista in 1987 as a Securities Analyst.
</TABLE>

Distributor. EDI is each Fund's distributor. EDI is located at 125 West 55th
Street, New York, New York 10019 and is a subsidiary of The BISYS Group, Inc.
EDI markets the Funds and distributes their shares through broker-dealers,
financial planners and other financial representatives. EDI is not affiliated
with First Union.

Transfer Agent. The Service Company is each Fund's transfer agent. The Service
Company is a subsidiary of First Union and is located at 200 Berkeley Street,
Boston, MA 02116-5034. The Service Company handles shareholder services,
including record keeping and account statements, distribution of dividends and
capital gains and processing of transactions.

Administrator. Evergreen Investment Services, Inc. ("EIS") serves as
administrator to each Fund. EIS is located at 200 Berkeley Street, Boston,
Massachusetts 02116-5034. As administrator, and subject to the supervision and
control of the Trust's Board of Trustees, EIS provides the Funds with
facilities, equipment and personnel. For its services as administrator, EIS is
entitled to receive a fee based on the aggregate average daily net assets of
the Funds at a rate based on the total assets of all mutual funds administered
by EIS for which any affiliate of FUNB serves as investment advisor. The
administration fee is calculated in accordance with the following schedule:

<TABLE>
<CAPTION>
AGGREGATE AVERAGE DAILY NET ASSETS OF MUTUAL FUNDS FOR WHICH ANY
ADMINISTRATIVE FEE AFFILIATE OF FUNB SERVES AS INVESTMENT ADVISOR
- ------------------ ----------------------------------------------------------------
<S> <C>
0.050% on the first $7 billion
0.035% on the next $3 billion
0.030% on the next $5 billion
0.020% on the next $10 billion
0.015% on the next $5 billion
0.010% on assets in excess of $30 billion
</TABLE>

OTHER INFORMATION AND POLICIES

Banking Laws. The Glass-Steagall Act and other banking laws and regulations
presently prohibit member banks of the Federal Reserve System ("Member Banks")
or their non-bank affiliates from sponsoring, organizing, controlling, or
distributing the shares of registered open-end investment companies such as
the Funds. Such laws and regulations also prohibit banks from issuing,
underwriting or distributing securities in general. However, under the Glass-
Steagall Act and such other laws and regulations, a Member Bank or an
affiliate thereof may act as investment advisor, transfer agent or custodian
to a registered open-end investment company and may also act as agent in
connection with the purchase of shares of such an investment company upon the
order of its customer. FUNB and its affiliates are subject to and in
compliance with the aforementioned laws and regulations.

Changes to applicable laws and regulations or future judicial or
administrative decisions could result in FUNB and its affiliates being
prevented from continuing to perform the services required under the
investment advisory agreements or from acting as agent in connection with the
purchase of shares of the Funds by their customers. If FUNB and its affiliates
were prevented from continuing to provide the services called for under the
investment advisory agreements, it is expected that the Trustees would
identify, and call upon each Fund's shareholders to approve, new investment
advisors. If this were to occur, it is not anticipated that the shareholders
of any Fund would suffer any adverse financial consequences.

21
<PAGE>

Securities Transactions. Under policies established by the Trust's Board of
Trustees, each Fund's investment advisor selects broker-dealers to execute
portfolio transactions subject to the receipt of best execution. In so doing,
each Fund's investment advisor may and does select broker-dealers who are
affiliated with the advisor. Moreover, the Funds may pay higher commissions to
broker-dealers that provide research services, which the advisor may use in
advising the Funds or its other clients.

Portfolio Turnover. The portfolio turnover rates for each Fund appear under
"Financial Highlights."

A high rate of portfolio turnover (100% or more) may involve correspondingly
greater brokerage commissions and other transaction costs, which a Fund and
its shareholders must bear. It may also result in the realization of larger
amounts of net short-term capital gains, distributions from which are taxable
to shareholders as ordinary income.

Code of Ethics. Each Fund and its investment advisor have adopted a code of
ethics incorporating policies on personal securities trading. In general,
these codes of ethics require that certain personnel of the Funds and their
investment advisors (1) abstain from engaging in certain personal trading
practices and (2) report certain personal trading activities.

Other Classes of Shares. Each Fund, other than Evergreen Select Large Cap
Blend Fund, Evergreen Select Social Principles Fund and Evergreen Select
Equity Index Fund, offers two classes of shares, Institutional and
Institutional Service. Evergreen Select Large Cap Blend Fund and Evergreen
Select Social Principles Fund each offer three classes of shares, Charitable,
Institutional and Institutional Service. Evergreen Select Equity Index Fund
offers four classes of shares, Class A, Class B, Institutional and
Institutional Service. Only Institutional Shares are offered through this
prospectus. Call the Service Company at 1-800-343-2898 for information on the
other classes of shares, including how to get a prospectus.

Year 2000 Risks. Like other investment companies, financial and business
organizations and individuals around the world, the Funds could be adversely
affected if the computer systems used by the Funds' investment advisors and
the Funds' other service providers do not properly process and calculate date-
related information and data from and after January 1, 2000. This is commonly
known as the "Year 2000 Problem." The Funds' investment advisors are taking
steps to address the Year 2000 Problem with respect to the computer systems
that they use and to obtain assurances that comparable steps are being taken
by the Funds' other major service providers. At this time, however, there can
be no assurance that these steps will be sufficient to avoid any adverse
impact on the Funds.

FUND PERFORMANCE

Total Return. Total return is the change in value of an investment in a Fund
over a given period, assuming that dividends and capital gains are reinvested
and that recurring charges are deducted. A cumulative total return reflects
actual performance over a stated period of time. An average annual total
return is a hypothetical rate of return that, if achieved annually, would have
produced the same cumulative total return if performance had been constant
over the entire period. Average annual total returns smooth out variations in
performance; they are not the same as actual year-by-year results.

Yield. Yield is the income generated by an investment in a Fund over a given
period of time, expressed as an annual percentage rate. Yields are calculated
according to a standard that is required for all stock and bond Funds. Because
this differs from other accounting methods, the quoted yield may not equal the
income actually paid to shareholders.

Related Performance Information. EVERGREEN SELECT STRATEGIC VALUE FUND,
EVERGREEN SELECT LARGE CAP BLEND FUND, EVERGREEN SELECT COMMON STOCK FUND,
EVERGREEN SELECT STRATEGIC GROWTH FUND, EVERGREEN SELECT EQUITY INCOME FUND
AND EVERGREEN SELECT SOCIAL PRINCIPLES FUND. The Funds commenced operations on
or about November 24, 1997. On that date, each of seven common trust funds
(each a "CTF") transferred substantially all its assets to the Fund having
materially equivalent investment objectives, policies and limitations in
exchange for shares of such Fund. After such transfer, each Fund's portfolio
of investments was the same as the portfolio of the corresponding CTF
immediately prior to the transfer. The performance information below is that
of the CTFs and not the Funds. Past performance is not a guarantee of future
performance.

22
<PAGE>

The CTFs are for all practical purposes "predecessors" of the Funds. As a
result, the performance for each Fund's Institutional Shares is calculated for
periods before the commencement of the Funds' operations by including the
corresponding CTF's average annual total return. The CTFs' average annual
total return is adjusted to reflect the deduction of fees and expenses as
stated under "Expenses." These fees and expenses include management fees and
certain other Fund expenses. These fees and expenses have not, however, been
adjusted to reflect any expense waivers or reimbursements. Applying the
expenses of the Funds rather than those of the CTF's makes the performance
figures below lower.

The quoted performance data includes the performance of the CTFs for
periods before the Trust's Registration Statement became effective. In the
case of Evergreen Select Strategic Growth Fund, where two CTFs transferred
assets into the Fund, performance information provided is for the larger of
the two CTFs. The CTFs were not registered under the Investment Company Act of
1940, as amended (the "1940 Act") and thus were not subject to certain
investment restrictions that are imposed by the 1940 Act. If the CTFs had been
registered under the 1940 Act, their performance might have been adversely
affected. In addition, the CTFs were not subject to the provisions of the Code
with respect to "regulated investment companies," which provisions, if
imposed, could have adversely affected the CTFs' performance. Employee benefit
plans that invest plan assets in the CTFs may be subject to certain charges as
set forth in their respective Plan Documents. Total return figures would be
lower for the period if they reflected these charges.

<TABLE>
<CAPTION>
FUND NAME (PREDECESSOR CTF) 1 YEAR 3 YEARS 5 YEARS 10 YEARS (OR
(THE FUNDS COMMENCED OPERATIONS ON (ENDING (ENDING (ENDING SINCE INCEPTION
NOVEMBER 24, 1997) 10/31/96) 10/31/96) 10/31/96) INCEPTION) DATE
- ---------------------------------- --------- --------- --------- ------------ ---------
<S> <C> <C> <C> <C> <C>
Evergreen Select Strategic
Value Fund
(Select Value Trust) 33.24% 26.47% 20.55% 16.58% 12/31/81
Institutional Shares
Evergreen Select Large Cap
Blend Fund
(Charitable Equity Trust) 29.69% 30.01% N/A 22.12% 12/31/93
Institutional Shares
Evergreen Select Common
Stock Fund
(Common Stock Trust) 30.07% 26.65% 16.67% 14.90% 12/31/81
Institutional Shares
Evergreen Select Strategic
Growth Fund
(Common Stock Growth
Trust) 28.41% N/A N/A 30.28% 12/31/94
Institutional Shares
Evergreen Select Equity
Income Fund
(Equity Income Trust) 25.08% 21.29% 14.43% 13.71% 12/31/78
Institutional Shares
Evergreen Select Social
Principles Fund
(Social Principles Trust) 28.33% 24.80% 18.98% 15.30% 5/31/88
Institutional Shares
</TABLE>

Performance of Evergreen Asset for Private Accounts Similar to EVERGREEN
SELECT SMALL COMPANY VALUE FUND. Set forth below is composite performance
information relating to the historical performance of all actual, fee-paying,
fully discretionary equity accounts managed by Evergreen Asset. These accounts
have investment objectives, policies, strategies, and risks substantially
similar to those of Evergreen Select Small Company Value Fund.

Evergreen Asset's composite performance data shown below is presented in
accordance with the recommended standards of the Association for Investment
Management and Research (commonly referred to as AIMR) retroactively applied
for all time periods. All returns include cash and cash equivalents. These
results calculated by AIMR standards would be different from those obtained by
using the SEC method of accounting performance of a mutual fund. Securities
transactions are accounted for on the trade date and accrual accounting is
utilized. The composite's returns are calculated on a time-weighted basis and
do not reflect the deduction of fees or expenses.

The investment results of Evergreen Asset's composite presented below are
unaudited and are not intended to predict or suggest the future returns of the
Fund. The performance data set forth below is provided to illustrate the past
performance of Evergreen Asset in managing substantially similar accounts and
does not represent the performance of the Fund. Investors should be aware that
the use of a methodology different than that used below to calculate
performance could result in different performance data. The accounts contained
in

23
<PAGE>

the composite are not subject to the same type of expenses as the Fund and are
not subject to the diversification requirements, specific tax restrictions,
and investment limitations imposed on a mutual fund by federal law.
Consequently, the performance results for such accounts could have been
adversely affected if they had been regulated under federal laws.

<TABLE>
<CAPTION>
TOTAL ASSETS NO. OF
(IN MILLIONS) AT ACCOUNTS
12/31/97(SM AS OF
COMPOSITE M) FOR AIMR 12/31/97 1 YEAR 3 YEARS 5 YEARS 10 YEARS
- --------- ---------------- -------- ------ ------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Small Cap Composite 296.4 3 39.51% 32.89% 20.39% 17.62%

The composite performance reflecting the estimated expenses of the
Evergreen Select Small Company Value Fund would be as follows:

<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<C> <C> <C> <C>
38.33% 31.71% 19.21% 16.43%
</TABLE>

EVERGREEN SELECT BALANCED FUND AND EVERGREEN SELECT DIVERSIFIED VALUE
FUND. The following total return information is provided with reference to
Evergreen Balanced Fund and Evergreen Value Fund, the Class Y shares of which
were reorganized into the Institutional Shares of Evergreen Select Balanced
Fund and Evergreen Select Diversified Value Fund, respectively in November of
1997. Evergreen Balanced Fund and Evergreen Value Fund were series of
Evergreen Investment Trust, a registered investment company managed by
Evergreen Asset. Evergreen Balanced Fund and Evergreen Value Fund have
investment objectives, policies and strategies materially equivalent to those
of Evergreen Select Balanced Fund and Evergreen Select Diversified Value Fund,
respectively. Past performance of the Evergreen Balanced Fund and Evergreen
Value Fund is no guarantee of the future performance of Evergreen Select
Balanced Fund and Evergreen Select Diversified Value Fund. The performance
information set forth below is provided as of March 31, 1997 for Evergreen
Balanced Fund and as of December 31, 1997 for Evergreen Value Fund.

<TABLE>
<CAPTION>
EVERGREEN EVERGREEN
PERIOD BALANCED FUND VALUE FUND
------ ------------- ----------
<S> <C> <C>
One Year 19.97% 27.77%
Three Years 17.69% 22.49%
Five Years 13.13% 17.04%
Ten Years 12.80% 16.95%
Inception Date 4/1/91 1/3/91
</TABLE>

General. The Funds may include comparative performance information in
advertising or in marketing the Funds' shares. Such information could include
data from Lipper Analytical Services, Inc., Morningstar, Inc., CDA
Weisenberger and Value Line, or other industry publications or various indexes
such as the S&P 500 Index.

For more information on the Funds' performance, see the SAI.

24
<PAGE>

INVESTMENT ADVISORS
First Union National Bank, 201 South College Street, Charlotte, North Carolina
28288-0630
(Evergreen Select Strategic Value Fund, Evergreen Select Diversified
Value Fund, Evergreen Select Large Cap Blend Fund, Evergreen Select
Common Stock Fund, Evergreen Select Strategic Growth Fund, Evergreen
Select Equity Income Fund, Evergreen Select Social Principles Fund,
Evergreen Select Balanced Fund and Evergreen Select Equity Index Fund)
Evergreen Asset Management Corp., 2500 Westchester Avenue, Purchase, New York
10577
(Evergreen Select Small Company Value Fund)
Meridian Investment Company, 55 Valley Stream Parkway, Malvern, Pennsylvania
19355
(Evergreen Select Special Equity Fund)
Evergreen Investment Management Company, 200 Berkeley Street, Boston,
Massachusetts 02116-5034
(Evergreen Select Small Cap Growth Fund)

CUSTODIAN
State Street Bank and Trust Company, P.O. Box 9021, Boston, Massachusetts
02205-9827

TRANSFER AGENT
Evergreen Service Company, 200 Berkeley Street, Boston, Massachusetts 02116-
5034

LEGAL COUNSEL
Sullivan & Worcester LLP, 1025 Connecticut Avenue, N.W., Washington, D.C. 20036

INDEPENDENT AUDITORS
KPMG Peat Marwick LLP, 99 High Street, Boston, Massachusetts 02110

DISTRIBUTOR
Evergreen Distributor, Inc., 125 West 55th Street, New York, New York 10019

63867 541909Rv1

<PAGE>

- -------------------------------------------------------------------------------
PROSPECTUS November 1, 1998
- -------------------------------------------------------------------------------

EVERGREEN SELECT EQUITY TRUST [LOGO OF EVERGREEN FUNDS APPEARS HERE]
- -------------------------------------------------------------------------------

INSTITUTIONAL SERVICE SHARES

This prospectus explains important information about the Institutional
Service Shares of the Evergreen Select Equity Trust, including information on
how the Funds invest and services available to shareholders. Please read this
prospectus before investing, and keep it for future reference.

PLEASE REMEMBER THAT SHARES OF THE FUNDS ARE:

. NOT DEPOSITS OR OBLIGATIONS OF ANY BANK.

. NOT ENDORSED OR GUARANTEED BY ANY BANK.

. NOT INSURED OR OTHERWISE PROTECTED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER AGENCY.

. SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL
AMOUNT.

Keep This Prospectus For Future Reference

EVERGREEN SM is a Service Mark of Evergreen Asset Management Corp. Copyright
1995, Evergreen Asset Management Corp.
<PAGE>

TABLE OF CONTENTS

<TABLE>
<S> <C>
EXPENSES................................................................ 3
FINANCIAL HIGHLIGHTS.................................................... 4
FUND DESCRIPTIONS....................................................... 10
Investment Objectives................................................ 10
Securities and Investment Practices.................................. 11
BUYING AND SELLING SHARES............................................... 14
How To Buy Shares.................................................... 14
How to Redeem Shares................................................. 15
Additional Transaction Policies...................................... 16
Exchanges............................................................ 16
Dividends............................................................ 16
Taxes................................................................ 17
Shareholder Services................................................. 17
FUND DETAILS............................................................ 17
Fund Organization and Service
Providers........................................................... 17
Other Information And Policies....................................... 21
Fund Performance..................................................... 22
</TABLE>

2
<PAGE>

- -------------------------------------------------------------------------------

EXPENSES

- -------------------------------------------------------------------------------

<TABLE>
<CAPTION>
ANNUAL FUND OPERATING MANAGEMENT OTHER TOTAL OPERATING
EXPENSES FEES EXPENSES EXPENSES (AFTER
(AS A PERCENTAGE OF (AFTER EXPENSE 12B-1 (AFTER EXPENSE EXPENSE WAIVERS OR
AVERAGE DAILY NET ASSETS) WAIVERS)(1) FEES REIMBURSEMENTS) REIMBURSEMENTS)(1)
- ------------------------- -------------- ------- --------------- ------------------
<S> <C> <C> <C> <C>
Evergreen Select
Strategic Value Fund 0.60% 0.25% 0.15% 1.00%
Evergreen Select
Diversified Value Fund 0.50% 0.25% 0.18% 0.93%
Evergreen Select Large
Cap Blend Fund 0.58% 0.25% 0.13% 0.96%
Evergreen Select Common
Stock Fund 0.53% 0.25% 0.17% 0.95%
Evergreen Select
Strategic Growth Fund 0.58% 0.25% 0.14% 0.97%
Evergreen Select Equity
Income Fund 0.60% 0.25% 0.17% 1.02%
Evergreen Select Small
Company Value Fund 0.65% 0.25% 0.35% 1.25%
Evergreen Select Social
Principles Fund 0.67% 0.25% 0.19% 1.11%
Evergreen Select Balanced
Fund 0.50% 0.25% 0.20% 0.95%
Evergreen Select Equity
Index Fund 0.12% 0.25% 0.18% 0.55%
Evergreen Select Special
Equity Fund(2) 0.74% 0.25% 0.31% 1.30%
Evergreen Select Small
Cap Growth Fund 0.80% 0.25% 0.21% 1.26%
EXAMPLE OF FUND EXPENSES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------------------------ ------ ------- ------- --------
Evergreen Select
Strategic Value Fund $10 $32 $55 $122
Evergreen Select
Diversified Value Fund $ 9 $30 $51 $114
Evergreen Select Large
Cap Blend Fund $10 $31 $53 $118
Evergreen Select Common
Stock Fund $10 $30 $53 $117
Evergreen Select
Strategic Growth Fund $10 $31 $54 $119
Evergreen Select Equity
Income Fund $10 $32 $56 $125
Evergreen Select Small
Company Value Fund $13 $40 $69 $151
Evergreen Select Social
Principles Fund $11 $35 $61 $135
Evergreen Select Balanced
Fund $10 $30 $53 $117
Evergreen Select Equity
Index Fund $ 6 $18 $31 $ 69
Evergreen Select Special
Equity Fund $13 $41 $71 $157
Evergreen Select Small
Cap Growth Fund $13 $40 N/A N/A
</TABLE>
- -------
(1) The investment advisor of each Fund, other than Evergreen Select Small Cap
Growth Fund, has voluntarily agreed to waive a portion of each Fund's
investment advisory fee. Without such waivers, each management fee set
forth above would be higher. The investment advisors currently intend to
continue this expense waiver indefinitely; however, each may modify or
cancel its expense waiver at any time. See "Fund Details" for more
information.
(2) The investment advisor of Evergreen Select Special Equity Fund has
undertaken to limit the Fund's Total Operating Expenses for a period of at
least two years to 2.07%.
Absent expense waivers and/or reimbursements, the Total Operating
Expenses for each of the Funds would be as follows:

<TABLE>
<CAPTION>
MANAGEMENT FEE 12B-1 OTHER EXPENSES (WITHOUT TOTAL FUND
FUND (WITHOUT WAIVERS) FEES REIMBURSEMENTS) OPERATING EXPENSES
- ---- ----------------- ----- ----------------------- ------------------
<S> <C> <C> <C> <C>
Evergreen Select
Strategic Value Fund 0.70% 0.25% 0.15% 1.10%
Evergreen Select
Diversified Value Fund 0.60% 0.25% 0.18% 1.03%
Evergreen Select Large
Cap Blend Fund 0.70% 0.25% 0.13% 1.08%
Evergreen Select Common
Stock Fund 0.70% 0.25% 0.17% 1.12%
Evergreen Select
Strategic Growth Fund 0.70% 0.25% 0.14% 1.09%
Evergreen Select Equity
Income Fund 0.70% 0.25% 0.17% 1.12%
Evergreen Select Small
Company Value Fund 0.90% 0.25% 0.35% 1.50%
Evergreen Select Social
Principles Fund 0.80% 0.25% 0.19% 1.24%
Evergreen Select
Balanced Fund 0.60% 0.25% 0.20% 1.05%
Evergreen Select Equity
Index Fund 0.40% 0.25% 0.18% 0.83%
Evergreen Select Special
Equity Fund 1.50% 0.25% 0.31% 2.06%
Evergreen Select Small
Cap Growth Fund 0.80% 0.25% 0.21% 1.26%
</TABLE>

3
<PAGE>

- -------------------------------------------------------------------------------

FINANCIAL HIGHLIGHTS

- -------------------------------------------------------------------------------

The tables on the following pages present, for each Fund, financial
highlights for a share outstanding throughout each period indicated. The
information in the tables for Evergreen Select Strategic Value Fund, Evergreen
Select Diversified Value Fund, Evergreen Select Large Cap Blend Fund,
Evergreen Select Common Stock Fund, Evergreen Select Strategic Growth Fund,
Evergreen Select Equity Income Fund, Evergreen Select Social Principles Fund,
Evergreen Select Balanced Fund and Evergreen Select Small Cap Growth Fund has
been audited by KPMG Peat Marwick LLP, each Fund's independent auditors. A
report of KPMG Peat Marwick LLP on the audited information with respect to
each Fund is included in the Fund's Annual Report which is incorporated by
reference into the Funds' SAI. Evergreen Select Equity Index Fund and
Evergreen Select Special Equity Fund were formerly Equity Index Fund and
Special Equity Fund, respectively, portfolios of CoreFunds, Inc. They were
reorganized into Evergreen funds in July 1998. The information for Evergreen
Select Equity Index Fund and Evergreen Select Special Equity Fund for the
periods from November 1, 1995 to June 30, 1998 has been audited by Ernst &
Young LLP. The information for Evergreen Select Special Equity Fund for the
periods ended October 31, 1994 and October 31, 1995 has been audited by the
Funds' prior independent auditors. A report of Ernst & Young LLP on the
audited information with respect to each Fund is included in the Funds' Annual
Report which is incorporated by reference in the Fund's SAI. The Fund's Annual
Reports may be obtained without charge. For the fiscal period ended June 30,
1998 the Evergreen Select Small Company Value Fund and Evergreen Select Small
Cap Growth Fund did not have any shares outstanding.

EVERGREEN SELECT STRATEGIC VALUE FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
1998*
------------
<S> <C>
NET ASSET VALUE BEGINNING OF PERIOD................................ $223.08
-------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............................................. 0.61
Net realized and unrealized gain on investments................... 3.13
-------
Total from investment operations................................... 3.74
-------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income......................................... (0.78)
-------
Total distributions................................................ (0.78)
-------
NET ASSET VALUE END OF PERIOD...................................... $226.04
=======
TOTAL RETURN....................................................... 1.68%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET ASSETS:
Total expenses.................................................... 1.00%+
Total expenses, excluding indirectly paid expenses................ 1.00%+
Total expenses, excluding fee waiver and expense reimbursement.... 1.10%+
Net investment income............................................. 0.93%+
PORTFOLIO TURNOVER RATE............................................ 12%
AVERAGE COMMISSION RATE PER SHARE.................................. $0.0619
NET ASSETS END OF PERIOD (THOUSANDS)............................... $ 1,327
</TABLE>
- -------
+Annualized.
*For the period from March 11, 1998 (commencement of class operations) to June
30, 1998.

4
<PAGE>

EVERGREEN SELECT DIVERSIFIED VALUE FUND
<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
1998*
------------
<S> <C>
NET ASSET VALUE BEGINNING OF PERIOD................................ $26.56
-------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............................................. 0.06
Net realized and unrealized gain on investments................... (0.64)
-------
Total from investment operations................................... (0.58)
-------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income......................................... (0.05)
-------
Total distributions................................................ (0.05)
-------
NET ASSET VALUE END OF PERIOD...................................... $25.93
=======
TOTAL RETURN....................................................... (2.19%)
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET ASSETS:
Total expenses.................................................... 0.93%+
Total expenses, excluding indirectly paid expenses................ 0.93%+
Total expenses, excluding fee waiver and expense reimbursement.... 1.03%+
Net investment income............................................. 0.80%+
PORTFOLIO TURNOVER RATE............................................ 56%
AVERAGE COMMISSION RATE PER SHARE.................................. $0.0567
NET ASSETS END OF PERIOD (THOUSANDS)............................... $ 210
</TABLE>
- -------
+Annualized.
*For the period from March 31, 1998 (commencement of class operations) to June
30, 1998.

EVERGREEN SELECT LARGE CAP BLEND FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
1998*
------------
<S> <C>
NET ASSET VALUE BEGINNING OF PERIOD................................ $ 49.75
-------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............................................. 0.08
Net realized and unrealized gain on investments................... 1.00
-------
Total from investment operations................................... 1.08
-------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income......................................... (0.08)
In excess of net investment income................................. (0.01)
-------
Total distributions................................................ (0.09)
-------
NET ASSET VALUE END OF PERIOD...................................... $ 50.74
=======
TOTAL RETURN....................................................... 2.17%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET ASSETS:
Total expenses.................................................... 0.96%+
Total expenses, excluding indirectly paid expenses................ 0.96%+
Total expenses, excluding fee waiver and expense reimbursement.... 1.08%+
Net investment income............................................. 0.57%+
PORTFOLIO TURNOVER RATE............................................ 42%
AVERAGE COMMISSION RATE PER SHARE.................................. $0.0591
NET ASSETS END OF PERIOD (THOUSANDS)............................... $ 301
</TABLE>
- -------
+Annualized.
*For the period from March 12, 1998 (commencement of class operations) to June
30, 1998.

5
<PAGE>

EVERGREEN SELECT COMMON STOCK FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
1998*
------------
<S> <C>
NET ASSET VALUE BEGINNING OF PERIOD................................ $ 80.21
-------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............................................. 0.27
Net realized and unrealized gain on investments................... 7.16
-------
Total from investment operations................................... 7.43
-------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income......................................... (0.31)
-------
Total distributions................................................ (0.31)
-------
NET ASSET VALUE END OF PERIOD...................................... $ 87.33
=======
TOTAL RETURN....................................................... 9.27%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET ASSETS:
Total expenses.................................................... 0.95%+
Total expenses, excluding indirectly paid expenses................ 0.95%+
Total expenses, excluding fee waiver and expense reimbursement.... 1.12%+
Net investment income............................................. 0.60%+
PORTFOLIO TURNOVER RATE............................................ 22%
AVERAGE COMMISSION RATE PER SHARE.................................. $0.0573
NET ASSETS END OF PERIOD (MILLIONS)................................ $ 18
</TABLE>
- -------
+Annualized.
*For the period from February 4, 1998 (commencement of class operations) to
June 30, 1998.

EVERGREEN SELECT STRATEGIC GROWTH FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
1998*
------------
<S> <C>
NET ASSET VALUE BEGINNING OF PERIOD............................... $ 36.10
-------
INCOME (LOSS) FROM INVESTMENT OPERATIONS
Net investment income (loss)..................................... (0.08)
Net realized and unrealized gain on investments.................. 2.34
-------
Total from investment operations.................................. 2.26
-------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income........................................ 0
-------
Total distributions............................................... 0
-------
NET ASSET VALUE END OF PERIOD..................................... $ 38.36
=======
TOTAL RETURN...................................................... 6.29%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET ASSETS:
Total expenses................................................... 0.97%+
Total expenses, excluding indirectly paid expenses............... 0.97%+
Total expenses, excluding fee waiver and expense reimbursement... 1.09%+
Net investment income............................................ (0.27%)+
PORTFOLIO TURNOVER RATE........................................... 80%
AVERAGE COMMISSION RATE PER SHARE................................. $0.0595
NET ASSETS END OF PERIOD (THOUSANDS).............................. $ 2,373
</TABLE>
- -------
+Annualized.
*For the period from February 27, 1998 (commencement of class operations) to
June 30, 1998.

6
<PAGE>

EVERGREEN SELECT EQUITY INCOME FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
1998*
------------
<S> <C>
NET ASSET VALUE BEGINNING OF PERIOD................................ $ 90.83
-------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............................................. 0.65
Net realized and unrealized gain on investments................... (1.69)
-------
Total from investment operations................................... (1.04)
-------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income......................................... (0.63)
In excess of net investment income................................. (0.11)
-------
Total distributions................................................ (0.74)
-------
NET ASSET VALUE END OF PERIOD...................................... $ 89.05
=======
TOTAL RETURN....................................................... (1.16%)
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET ASSETS:
Total expenses.................................................... 1.04%+
Total expenses, excluding indirectly paid expenses................ 1.03%+
Total expenses, excluding fee waiver and expense reimbursement.... 1.13%+
Net investment income............................................. 2.46%+
PORTFOLIO TURNOVER RATE............................................ 51%
AVERAGE COMMISSION RATE PER SHARE.................................. $0.0594
NET ASSETS END OF PERIOD (THOUSANDS)............................... $ 1,497
</TABLE>
- -------
+Annualized.
*For the period from March 11, 1998 (commencement of class operations) to June
30, 1998.

EVERGREEN SELECT SOCIAL PRINCIPLES FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
1998*
------------
<S> <C>
NET ASSET VALUE BEGINNING OF PERIOD............................... $ 38.44
-------
INCOME (LOSS) FROM INVESTMENT OPERATIONS
Net investment income............................................ (0.01)
Net realized and unrealized gain on investments.................. 0.52
-------
Total from investment operations.................................. 0.51
-------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income........................................ (0.01)
-------
Total distributions............................................... (0.01)
-------
NET ASSET VALUE END OF PERIOD..................................... $ 38.94
=======
TOTAL RETURN...................................................... 1.32%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET ASSETS:
Total expenses................................................... 1.11%+
Total expenses, excluding indirectly paid expenses............... 1.11%+
Total expenses, excluding fee waiver and expense reimbursement... 1.24%+
Net investment income............................................ (0.12%)+
PORTFOLIO TURNOVER RATE........................................... 24%
AVERAGE COMMISSION RATE PER SHARE................................. $0.0585
NET ASSETS END OF PERIOD (THOUSANDS).............................. $ 205
</TABLE>
- -------
+Annualized.
*For the period from March 12, 1998 (commencement of class operations) to June
30, 1998.

7
<PAGE>

EVERGREEN SELECT BALANCED FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
1998*
------------
<S> <C>
NET ASSET VALUE BEGINNING OF PERIOD................................ $ 13.34
-------
INCOME FROM INVESTMENT OPERATIONS
Net investment income............................................. 0.07
Net realized and unrealized gain on investments................... 0.09
-------
Total from investment operations................................... 0.16
-------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income......................................... (0.08)
-------
Total distributions................................................ (0.08)
-------
NET ASSET VALUE END OF PERIOD...................................... $ 13.42
=======
TOTAL RETURN....................................................... 1.23%
RATIOS/SUPPLEMENTAL DATA
RATIOS TO AVERAGE NET ASSETS:
Total expenses.................................................... 0.95%+
Total expenses, excluding indirectly paid expenses................ 0.95%+
Total expenses, excluding fee waiver and expense reimbursement.... 1.05%+
Net investment income............................................. 2.58%+
PORTFOLIO TURNOVER RATE............................................ 37%
AVERAGE COMMISSION RATE PER SHARE.................................. $0.0597
NET ASSETS END OF PERIOD (THOUSANDS)............................... $ 215
</TABLE>
- -------
+Annualized.
*For the period from April 9, 1998 (commencement of class operations) to June
30, 1998.

EVERGREEN SELECT EQUITY INDEX FUND*

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30,
------------------
1998 1997(1)
------- -------
<S> <C> <C>
NET ASSET VALUE, BEGINNING OF PERIOD...................... $ 37.37 $ 29.62
------- -------
Net Investment Income..................................... 0.49 0.32
Realized and Unrealized Net Gains on Securities........... 10.12 8.05
Distributions from Net Investment Income.................. (0.47) (0.38)
Distributions from Capital Gains.......................... (1.24) (0.24)
------- -------
Net Asset Value, End of Period............................ $ 46.27 $ 37.37
======= =======
TOTAL RETURN(2)........................................... 27.17% 28.58%+
Net Assets, End of Period (000 omitted)................... $11,944 $ 4,507
Ratio of Expenses to Average Net Assets................... 0.38% 0.37%
Ratio of Net Income to Average Net Assets................. 1.19% 1.51%
Ratio of Expenses to Average Net Assets (Excluding
Waivers)................................................. 0.71% 0.69%
Ratio of Net Income to Average Net Assets (Excluding
Waivers)................................................. 0.86% 1.19%
Portfolio Turnover Rate................................... 12% 11%
Average Commission Rate Paid(3)........................... $0.0621(4) $0.0545
</TABLE>
- -------
* In July 1998, the Class A and Class B shares of Equity Index Fund, a
portfolio of CoreFunds, Inc., were reorganized into Institutional Service
Shares of Evergreen Select Equity Index Fund. The information provided above
is for the Class A shares of the Equity Index Fund.
+ This figure has not been annualized.
(1)Commenced operations October 9, 1996. Unless otherwise noted, all ratios
for the period have been annualized.
(2) Total return does not reflect applicable sales load.
(3) Average commission rate paid per share for security purchases and sales
during the period.
(4) Unaudited.

8
<PAGE>

EVERGREEN SELECT SPECIAL EQUITY FUND*+

<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
JUNE 30 OCTOBER 31
------------------------------ ------------------
RETAIL PRIOR
CLASS CLASS(1)
1998 1997 1996(3) 1995 1994
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
NET ASSET VALUE,
BEGINNING OF PERIOD.... $ 11.25 $ 11.85 $ 11.42 $ 9.37 $ 10.00
-------- -------- -------- -------- --------
Net Investment Income
(Loss)................. (0.10) -- 0.08 0.12 0.06
Realized and Unrealized
Net Gains (Losses) on
Securities............. 1.52 1.81 2.11 2.12 (0.63)
Distributions from Net
Investment Income...... -- (0.02) (0.07) (0.12) (0.06)
Distributions from
Capital Gains.......... (1.49) (2.39) (1.69) (0.07) --
-------- -------- -------- -------- --------
Net Asset Value, End of
Period................. $ 11.18 $ 11.25 $ 11.85 $ 11.42 $ 9.37
======== ======== ======== ======== ========
TOTAL RETURN(2)......... 13.78% 17.73% 22.14% 24.44% (5.72)%
Net Assets, End of
Period (000 omitted)... $ 2,981 $ 2,347 $ 1,144 $ 734 $ 10,069
Ratio of Expenses to
Average Net Assets..... 1.35% 1.14% 0.37% 0.27% 0.15%
Ratio of Net Income
(Loss) to Average Net
Assets................. (0.73)% (0.12)% 0.91% 1.29% 1.06%
Ratio of Expenses to
Average Net Assets
(Excluding Waivers).... 2.11% 2.07% 1.82% 2.24% 2.10%
Ratio of Net Loss to
Average Net Assets
(Excluding Waivers).... (1.49)% (1.05)% (0.55)% (0.68)% (0.89)%
Portfolio Turnover
Rate**................. 62% 74% 72% 129% 39%
Average Commission Rate
Paid(4)................ $ 0.0628(5) $ 0.0257 $ 0.0539 n/a n/a
</TABLE>
- -------
+ In July 1998, the Class A and Class B shares of Special Equity Fund, a
portfolio of CoreFunds, Inc., were reorganized into Institutional Service
Shares of Evergreen Select Special Equity Fund. The information provided
above is for the Class A shares of the Equity Index Fund.
* On February 21, 1995, the Shares of the Fund were redesignated as either
Retail or Institutional Shares. On that date, the Fund's net investment
income, expenses and distributions for the period November 1, 1994 through
February 20, 1995 were allocated to each class of Shares. The basis for the
allocation was the relative net assets of each class of Shares as of
February 21, 1995. The results were combined with the results of operations
and distributions for each applicable class for the period February 21, 1995
through October 31, 1995. For the year ended October 31, 1995, the Financial
Highlights' ratio of expenses, net investment income, total return, and the
per share investment activities and distributions reflect this allocation.
Also, on April 22, 1996, the assets of the Conestoga Special Equity Fund
were acquired by CoreFunds. At that time the Retail Class Shares of the Fund
were exchanged for Class A Shares.
** For the period ended June 30, 1996, transactions relating to the merger
were excluded from the calculation of the Portfolio Turnover Rate.
(1) Commenced operations March 15, 1994. Unless otherwise noted, all ratios
for the period have been annualized.
(2) Total return does not reflect applicable sales load. Additionally, total
return for the period ended June 30, 1996 is for an eight-month period.
(3) The per share amount for the period ended June 30, 1996 represents the
period from November 1, 1995 to June 30, 1996. All prior years are for the
period November 1 to October 31.
(4) Presentation of the rate is only required for fiscal periods beginning
after September 1, 1995.
(5) Unaudited.

9
<PAGE>

- -------------------------------------------------------------------------------

FUND DESCRIPTIONS

- -------------------------------------------------------------------------------

INVESTMENT OBJECTIVES

10
<PAGE>

SECURITIES AND INVESTMENT PRACTICES

The Evergreen Select Equity Index Fund investment portfolio will
generally consist of common stocks of as many issuers listed in the S&P 500
Index as is feasible. The Fund's investment advisor uses a computer model that
closely monitors the industry weightings of the S&P 500 Index. Although the
Fund's investment advisor

11
<PAGE>

does not screen securities by traditional methods of financial and market
analyses, it monitors the Fund's investments with a view toward removing
stocks of companies which exhibit extreme financial distress or which may
impair the Fund's ability to achieve its investment objective. The Fund
strives to provide a total return comparable to the S&P 500 Index. Evergreen
Select Equity Index Fund is not sponsored by nor affiliated with S&P.

Foreign Investments. Evergreen Select Special Equity Fund may invest in
foreign securities. including securities of foreign issuers, securities issued
by foreign branches of U.S. banks and foreign banks, Canadian commercial paper
and Europaper (U.S. dollar-denominated commercial paper of foreign issuers),
American Depositary Receipts, European Depositary Receipts and Global
Depositary Receipts.

There are special risks associated with international investing:

. Currency Risk--The possibility that changes in foreign exchange rates
will affect, favorably or unfavorably, the value of foreign
securities.

. Volatility--Investments in foreign stock markets can be more volatile
than investments in U.S. markets. Diplomatic, political or economic
developments could affect investment in foreign countries.

. Regulatory Environment--Foreign companies generally are not subject to
uniform accounting, auditing and financial reporting standards
comparable to those applicable to U.S. domestic companies. There is
generally less government regulation of securities exchanges, brokers
and listed companies abroad than in the U.S. Foreign branches of U.S.
banks, foreign banks and foreign issuers may be subject to less
stringent reserve requirements and to different accounting, auditing,
reporting and record keeping standards than those applicable to
domestic branches of U.S. banks and U.S. domestic issuers.

. Credit Risk: The chance that the issuer of a bond will have its credit
rating downgraded or will default (fail to make scheduled interest and
principal payments), potentially reducing the Fund's income and/or
share price.

12
<PAGE>

An option on a futures contract gives the purchaser the right, in
exchange for a premium, to assume a position in a futures contract at a
specified exercise price during the term of the option. A put option on a
security gives the purchaser of the option the right to sell, and the writer
of the option the obligation to buy, the underlying security at any time
during the option period. A call option on a security gives the purchaser of
the option the right to buy, and the writer of the option the obligation to
sell the underlying security at any time during the option period. These
transactions are used to maintain cash reserves while remaining fully
invested, facilitate trading, reduce transaction costs or seek higher
investment returns when the contract is priced more attractively than the
underlying equity security or index.

The Funds may not use futures contracts or options transactions to
leverage their net assets for speculative purposes. See "Futures Transactions
and Related Options Transactions" in the SAI.

13
<PAGE>

borrow as a temporary measure for extraordinary or emergency purposes such as
the redemption of Fund shares. A Fund may purchase additional securities so
long as borrowings do not exceed 5% of its total assets.

Other Investment Restrictions. Each Fund has adopted additional investment
restrictions and guidelines that are set forth in the SAI.

- -------------------------------------------------------------------------------

BUYING AND SELLING SHARES

- -------------------------------------------------------------------------------

HOW TO BUY SHARES

Institutional investors may buy Institutional Service Shares of the Funds
through broker-dealers, banks and certain other financial intermediaries, or
directly through the Funds' distributor, Evergreen Distributor, Inc. ("EDI")
Investors may purchase Institutional Service Shares at the public offering
price, which equals the class, net asset value per share ("NAV"). See
"Offering Price and Other Purchase Information" below.

14
<PAGE>

Minimum Investment. The minimum initial investment in Institutional Service
Shares is $1 million, which may be waived in certain situations. There is no
minimum amount required for subsequent purchases.

HOW TO REDEEM SHARES

Mail Redemptions. You may redeem shares on each day that the New York Stock
Exchange ("NYSE") is open by mailing a written request to the Service Company
at the following address:

Evergreen Service Company
P.O. Box 2121
Boston, Massachusetts 02106-2121

The signatures on the written request must be properly guaranteed, as
described below.

If you are unable to reach the Funds or the Service Company by telephone,
you should redeem by mail.

15
<PAGE>

change, suspend or terminate any of the redemption methods described in this
prospectus, except redemptions by mail. For more information, see "How the
Funds Calculate Their NAV."

ADDITIONAL TRANSACTION POLICIES

EXCHANGES

You may exchange Institutional Service Shares of any Fund for
Institutional Service Shares of any other Evergreen Select fund. You may
exchange your shares through your broker-dealer, by mail or by telephone. All
exchange orders must comply with the applicable requirements for purchases and
redemptions and must include your account number, the number or value of
shares to be exchanged, the class of shares, and the funds to and from which
you wish to exchange.

Signatures on exchange orders must be guaranteed, as described above.

Please read the prospectus of the fund that you want to exchange into
before requesting your exchange.

For federal income tax purposes, an exchange is treated as a sale for
taxable investors.

DIVIDENDS

16
<PAGE>

that a Fund earns from its stocks plus any interest it receives from its
bonds. A Fund realizes a capital gain whenever it sells a security for a
higher price than its tax basis.

Dividend Schedule. Each Fund declares and pays dividends from its net
investment income monthly. Each Fund pays shareholders its net capital gains
at least once a year.

Payment Options. Unless you select another option on your account application,
your dividends and capital gains will be reinvested in additional shares of
the same class of the same Fund.

TAXES

Distributions to shareholders, whether taken in cash or reinvested in
shares, are generally considered taxable for federal income tax purposes as
follows:

. Income distributions and net short-term capital gains distributions
are taxable as ordinary income.

. Long-term capital gains distributions are taxable as capital gains,
regardless of how long you have held your shares.

SHAREHOLDER SERVICES

Details on all shareholder services may be obtained from the Service
Company by calling toll-free 1-800-343-2898 or by writing to the Service
Company.

- -------------------------------------------------------------------------------

FUND DETAILS

- -------------------------------------------------------------------------------

FUND ORGANIZATION AND SERVICE PROVIDERS

17
<PAGE>

"Exchanges," but will have no other preference, conversion, exchange or
preemptive rights. When issued and paid for, shares will be fully paid and
nonassessable. Shares of the Funds are redeemable, transferable and freely
assignable as collateral. The Trust may establish additional classes or series
of shares.

Evergreen Select Small Cap Growth Fund pays EIMC a fee for its services
as set forth below. Annual advisory fees are expressed as a percentage of
average net assets.

18
<PAGE>

FUNB, Evergreen Asset and Meridian currently intend to continue
indefinitely waiving a portion of each Fund's respective advisory fee, where
applicable. FUNB, Evergreen Asset and Meridian may each modify or cancel its
expense waiver at any time.

Portfolio Managers. Information about the individual portfolio managers
responsible for managing each Fund, including their occupations for the past
five years, is provided below.

<TABLE>
<CAPTION>
FUND PORTFOLIO MANAGER(S)
---- --------------------
<C> <S>
Evergreen Select Mark C. Sipe, CFA. Mark Sipe is a Senior Vice
Common Stock Fund President of FUNB, and Director of Equity Management
for First Investment Advisors, the investment group at
FUNB responsible for managing private capital
portfolios. He has over 20 years investment
experience, 16 with FUNB. He has managed or co-managed
the Fund since 1994. Aside from co-managing the Fund,
Mr. Sipe is responsible for the oversight of equity
research efforts and all equity investment processes.
Hanspeter Giger, CFA. Hanspeter Giger has 13 years of
investment management experience. He joined FUNB as an
Equity Analyst in 1987. For the past five years Mr.
Giger has been Director of Equity Research,
responsible for overseeing and coordinating FUNB's
Investment Research/Core Team, in addition to co-
managing the Fund.
Evergreen Select Paul A. DiLella. Paul A. DiLella is a Vice President,
Equity Income Fund Analyst and Fund Manager of FUNB. Aside from managing
the Fund, Mr. DiLella has been the fund co-manager of
the Evergreen Utility Fund since 1996. Mr. DiLella
also has research responsibilities for the electric
utility, real estate investment trust and natural gas
distribution companies. Mr. DiLella joined First
Fidelity Bank in 1982, which was acquired by FUNB in
1995, as Vice President and Portfolio Manager of the
Asset Management Group. Mr. DiLella has over 17 years
of investment experience.
Evergreen Select Large Eric M. Wiegand. Eric Wiegand has managed the Fund
Cap Blend Fund since 1996 and is assisted by a team of seasoned
investment professionals. Mr. Wiegand is a Senior Vice
President and Senior Portfolio Manager, also
responsible for managing the Evergreen Select Social
Principles Fund. Prior to rejoining First Fidelity
Bank in 1994, which was acquired by FUNB in 1995,
Mr. Wiegand was an Assistant Vice President and
Portfolio Manager with First Fidelity Bank from 1989-
1993.
Evergreen Select Social Mr. Wiegand also acts as portfolio manager of the
Principles Fund Evergreen Select Large Cap Blend Fund.
Evergreen Select W. Shannon Reid, CFA. Shannon Reid has over 14 years
Strategic Growth Fund of investment experience. His responsibilities include
equity analysis and portfolio management for FUNB's
growth-style equity products. Mr. Reid has been with
FUNB since 1988 as a Vice President and Portfolio
Manager.
Timothy M. Stevenson, CFA. Tim Stevenson has over 17
years of investment experience. Mr. Stevenson joined
FUNB in 1994 as a Senior Vice President and Portfolio
Manager.
Evergreen Select Timothy O'Grady is the team leader of a group of
Strategic Value Fund seasoned professionals who manage the Strategic Value
Fund.
</TABLE>

19
<PAGE>

<TABLE>
<CAPTION>
FUND PORTFOLIO MANAGER(S)
---- --------------------
<C> <S>
Timothy E. O'Grady. Since joining FUNB (then First
Fidelity Bank) in 1986, Timothy O'Grady has been a
portfolio manager in the Employee Benefit
Equity/Balanced Unit of the Capital Management Group
in Newark, NJ. Mr. O'Grady is a Senior Vice President
and Senior Portfolio Manager and also co-manages the
Evergreen Select Value Fund.
Evergreen Select Small Stephen Lieber. Stephen Lieber is Chairman and Co-
Company Value Fund Chief Executive Officer of Lieber & Company and
Evergreen Asset. He was the founding Partner of Lieber
& Company in 1969 and served as Senior Partner until
June, 1994. He is Portfolio Manager of Evergreen Fund,
Evergreen Foundation Fund, Evergreen Tax Strategic
Foundation Fund, Evergreen VA Foundation Fund and
Evergreen VA Fund.
Peter J. Kovalski, CFA. Peter Kovalski joined Lieber &
Company as an analyst in 1992.
Nola M. Falcone, CFA. Nola Falcone is President and
Co-Chief Executive Officer of Lieber & Company and
Evergreen Asset. Ms. Falcone was a General Partner of
Lieber & Company from January, 1981 to June, 1994. She
is Portfolio Manager for Evergreen Income & Growth
Fund, Evergreen Small Cap Equity Income Fund and
Evergreen VA Small Cap Equity Fund.
Evergreen Select Dean Hawes. Dean Hawes has over 23 years of investment
Balanced Fund experience. Since joining FUNB from Merrill Lynch in
1981, Mr. Hawes has been a Vice President and Senior
Portfolio Manager.
Rollin C. Williams, CFA. Rollin Williams has over 29
years of investment and banking management experience.
In addition to managing FUNB's Diversified Bond Group
Trust and the Evergreen U.S. Government Fund, he is
also responsible for the management of over $2.2
billion in fixed income portfolios. Since joining FUNB
in 1993, Mr. Williams has been a Vice President and
Senior Portfolio Manager.
Evergreen Select Eric M. Teal. Mr. Teal, Vice President and
Diversified Value Fund Quantitative Equity Analyst, joined FUNB in September
1993 and currently heads the Quantitative
Analysis/Portfolio Management Unit within FUNB. He
began managing the Diversified Value Fund in June
1998, and is also responsible for risk analysis and
quantitative management for other Evergreen Select
Equity Funds.
Evergreen Select Leonard Capristo. Leonard Capristo has 27 years of
Equity Index Fund investment experience and currently manages FUNB
Capital Management Group's Enhanced Stock Market Fund.
He joined FUNB's Capital Management Group in 1989 as
the Director of Equity Trading. He rejoined the
Capital Management Group in 1997 from FUNB's Capital
Markets Group where he served as co-manager of public
equity investments for three years.
Evergreen Select Joseph E. Stocke, CFA. Joseph Stocke has been a Senior
Special Equity Fund Investment Manager/Equities with Meridian since 1990.
Mr. Stocke has been with Meridian since 1983 and prior
to July 1998 managed the Special Equity Fund and Core
Equity Fund of CoreFunds, Inc.
Evergreen Select Small Thomas Holman. Thomas Holman has been the Portfolio
Cap Growth Fund Manager of the Fund since joining EIMC in January,
1997. Prior to joining EIMC, Mr. Holman was an
investment officer and securities analyst at Invista
Capital Management, Inc. ("Invista"), Des Moines,
Iowa, from 1993 to 1997. Mr. Holman manages the Fund
in conjunction with the EIMC Small Cap Growth Team is
headed by J. Gary Craven, a EIMC Senior Vice
President. Prior to joining EIMC in 1996, Mr. Craven
was Vice President and Portfolio Manager of Invista.
He joined Invista in 1987 as a Securities Analyst.
</TABLE>

20
<PAGE>

<TABLE>
<CAPTION>
AGGREGATE AVERAGE DAILY NET ASSETS OF MUTUAL FUNDS FOR WHICH ANY
ADMINISTRATIVE FEE AFFILIATE OF FUNB SERVES AS INVESTMENT ADVISOR
------------------ ----------------------------------------------------------------
<S> <C>
0.050% on the first $7 billion
0.035% on the next $3 billion
0.030% on the next $5 billion
0.020% on the next $10 billion
0.015% on the next $5 billion
0.010% on assets in excess of $30 billion
</TABLE>

OTHER INFORMATION AND POLICIES

Distribution Plan. The Trust has adopted a distribution plan for the
Institutional Service Shares of each Fund as allowed under the Investment
Company Act of 1940 as amended (the "1940 Act"). Each Fund's distribution plan
permits the Fund to pay an annual service fee of up to 0.25% of the average
daily net assets of the class for personal services rendered to shareholders
and/or the maintenance of accounts. Each Fund's distribution plan may be
terminated at any time by vote of the disinterested Trustees, as defined in
the 1940 Act, or by vote of a majority of the outstanding Institutional
Service Shares. For more information about the Funds' distribution plans, see
the SAI.

21
<PAGE>

Portfolio Turnover. The portfolio turnover rates for each Fund, other than
Evergreen Select Small Cap Growth Fund and Evergreen Select Small Company
Value Fund, appear under the "Financial Highlights." The estimated annual
portfolio turnover rates for Evergreen Select Small Cap Growth Fund and
Evergreen Small Company Value Fund are not expected to exceed 120% and 50%,
respectively.

A high rate of portfolio turnover (100% or more) may involve
correspondingly greater brokerage commissions and other transaction costs,
which a Fund and its shareholders must bear. It may also result in the
realization of larger amounts of net short-term capital gains, distributions
from which are taxable to shareholders as ordinary income.

Other Classes of Shares. Each Fund, other than Evergreen Select Large Cap
Blend Fund, Evergreen Select Social Principles Fund and Evergreen Select
Equity Index Fund, offers two classes of shares, Institutional and
Institutional Service. Evergreen Select Large Cap Blend Fund and Evergreen
Select Social Principles Fund each offer three classes of shares, Charitable,
Institutional and Institutional Service. Evergreen Select Equity Index Fund
offers four classes of shares, Institutional, Institutional Service, Class A
and Class B. Only Institutional Service Shares are offered through this
prospectus. Call the Service Company at 1-800-343-2898 for information on the
other classes of shares, including how to get a prospectus.

Year 2000 Risks. Like other investment companies, financial business
organizations and individuals around the world, the Funds could be adversely
affected if the computer systems used by the Funds' investment advisors and
the Funds' other service providers do not properly process and calculate date-
related information and data from and after January 1, 2000. This is commonly
known as the "Year 2000 Problem." The Funds' investment advisors are taking
steps to address the Year 2000 Problem with respect to the computer systems
that they use and to obtain assurances that comparable steps are being taken
by the Funds' other major service providers. At this time, however, there can
be no assurance that these steps will be sufficient to avoid any adverse
impact on the Funds.

FUND PERFORMANCE

Related Performance Information. EVERGREEN SELECT STRATEGIC VALUE FUND,
EVERGREEN SELECT LARGE CAP BLEND FUND, EVERGREEN SELECT COMMON STOCK FUND,
EVERGREEN SELECT STRATEGIC GROWTH FUND, EVERGREEN SELECT EQUITY INCOME FUND
AND EVERGREEN SELECT SOCIAL PRINCIPLES FUND. The Funds commenced operations on
or about November 24, 1997. On that date, each of seven common trust funds
(each a "CTF") transferred substantially all its assets to the Fund having
materially equivalent investment objectives, policies and limitations in
exchange for shares of such Fund. After such transfer, each Fund's portfolio
of investments was the same as the portfolio of the corresponding CTF
immediately prior to the transfer. The performance below is that of the CTFs
and not the Funds. Past performance is not a guarantee of future performance.

The CTFs are for all practical purposes "predecessors" of the Funds. As a
result, the performance for each Fund's Institutional Service Shares is
calculated for periods before the commencement of the Funds'

22
<PAGE>

operations, by including the corresponding CTF's average annual total return.
The CTFs' average annual total return is adjusted to reflect the deduction of
fees and expenses as stated under "Expenses." These fees and expenses include
management fees, Rule 12b-1 fees and certain other Fund expenses. These fees
and expenses have not, however, been adjusted to reflect any expense waivers
or reimbursements. Applying the expenses of the Funds rather than those of the
CTFs makes the performance figures below lower.

The quoted performance data includes the performance of the CTFs for
periods before the Trust's Registration Statement became effective. In the
case of Evergreen Select Strategic Growth Fund, where two CTFs transferred
assets into the Fund, performance information provided is for the larger of
the two CTFs. The CTFs were not registered under the 1940 Act, and thus were
not subject to certain investment restrictions that are imposed by the 1940
Act. If the CTFs had been registered under the 1940 Act, their performance
might have been adversely affected. In addition, the CTFs were not subject to
the provisions of the Code with respect to "regulated investment companies,"
which provisions, if imposed, could have adversely affected the CTFs'
performance. Employee benefit plans that invest plan assets in the CTFs may be
subject to certain charges as set forth in their respective Plan Documents.
Total return figures would be lower for the period if they reflected these
charges.

<TABLE>
<CAPTION>
FUND NAME (PREDECESSOR
CTF)
(THE FUNDS COMMENCED 10 YEARS
OPERATIONS 1 YEAR 3 YEARS 5 YEARS (OR SINCE INCEPTION
ON NOVEMBER 24, 1997) (ENDING 10/31/96) (ENDING 10/31/96) (ENDING 10/31/96) INCEPTION) DATE
---------------------- ----------------- ----------------- ----------------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Evergreen Select
Strategic Value Fund
(Select Value Trust) 32.92% 26.16% 20.25% 16.29% 12/31/81
Institutional Service
Shares
Evergreen Select Large
Cap Blend Fund
(Charitable Equity
Trust) 29.38% 29.69% N/A 21.82% 12/31/93
Institutional Service
Shares
Evergreen Select Common
Stock Fund
(Common Stock Trust) 29.75% 26.34% 16.38% 14.62% 12/31/81
Institutional Service
Shares
Evergreen Select
Strategic Growth Fund
(Common Stock Growth
Trust) 28.10% N/A N/A 29.97% 12/31/94
Institutional Service
Shares
Evergreen Select Equity
Income Fund
(Equity Income Trust) 24.78% 20.99% 14.15% 13.43% 12/31/78
Institutional Service
Shares
Evergreen Select Social
Principles Fund
(Social Principles
Trust) 28.01% 24.50% 18.69% 15.02% 12/31/87
Institutional Service
Shares
</TABLE>

23
<PAGE>

requirements, specific tax restrictions, and investment limitations imposed on
a mutual fund by federal law. Consequently, the performance results for such
accounts could have been adversely affected if they had been regulated under
federal laws.

<TABLE>
<CAPTION>
TOTAL ASSETS NO. OF
(IN MILLIONS) AT ACCOUNTS
12/31/97(SM M) AS OF
COMPOSITE FOR AIMR 12/31/97 1 YEAR 3 YEARS 5 YEARS 10 YEARS
--------- ---------------- -------- ------ ------- ------- --------
<S> <C> <C> <C> <C> <C> <C>
Small Cap Composite 296.4 3 39.51% 32.89% 20.39% 17.62%
</TABLE>

The composite performance reflecting the estimated expenses of the
Evergreen Select Small Company Value Fund would be as follows:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C>
38.08% 31.46% 18.96% 16.18%
</TABLE>

EVERGREEN SELECT BALANCED FUND AND EVERGREEN SELECT DIVERSIFIED VALUE
FUND. The following total return information is provided with reference to
Evergreen Balanced Fund and Evergreen Value Fund, the Class Y shares of which
were reorganized into Evergreen Select Balanced Fund and Evergreen Select
Diversified Value Fund, respectively in November 1997. Evergreen Balanced Fund
and Evergreen Value Fund were series of Evergreen Investment Trust, a
registered investment company managed by Evergreen Asset. Evergreen Balanced
Fund and Evergreen Value Fund have investment objectives, policies and
strategies materially equivalent to those of Evergreen Select Balanced Fund
and Evergreen Select Diversified Value Fund, respectively. Past performance of
the Evergreen Balanced Fund and Evergreen Value Fund is no guarantee of the
future performance of Evergreen Select Balanced Fund and Evergreen Select
Diversified Value Fund. The performance information set forth below is
provided as of March 31, 1997 for Evergreen Balanced Fund and as of December
31, 1997 for Evergreen Value Fund.

For more information on the Funds' performance, see the SAI.

24
<PAGE>

CUSTODIAN
State Street Bank and Trust Company, P.O. Box 9021, Boston, Massachusetts
02205-9827

TRANSFER AGENT
Evergreen Service Company, 200 Berkeley Street, Boston, Massachusetts 02116-
5034

LEGAL COUNSEL
Sullivan & Worcester LLP, 1025 Connecticut Avenue, N.W., Washington, D.C. 20036

INDEPENDENT AUDITORS
KPMG Peat Marwick LLP, 99 High Street, Boston, Massachusetts 02110

DISTRIBUTOR
Evergreen Distributor, Inc., 125 West 55th Street, New York, New York 10019

542267Rv1
<PAGE>

- -------------------------------------------------------------------------------
PROSPECTUS November 1, 1998
- -------------------------------------------------------------------------------

EVERGREEN SELECT EQUITY TRUST [LOGO OF EVERGREEN FUNDS APPEARS HERE]
- -------------------------------------------------------------------------------

EVERGREEN SELECT LARGE CAP BLEND FUND
EVERGREEN SELECT SOCIAL PRINCIPLES FUND
(EACH A "FUND," TOGETHER THE "FUNDS")

CHARITABLE SHARES

This prospectus explains important information about the Charitable
Shares of the Evergreen Select Equity Trust, including information on how the
Funds invest and services available to shareholders. Please read this
prospectus before investing, and keep it for future reference.

To learn more about the Evergreen Select Equity Trust, call 1-800-343-
2898 for a free copy of the Fund's statement of additional information ("SAI")
dated November 1, 1998 as supplemented from time to time. The Funds have filed
the SAI with the Securities and Exchange Commission ("SEC") and have
incorporated it by reference (legally included it) into this prospectus.

PLEASE REMEMBER THAT SHARES OF THE FUNDS ARE:

. NOT DEPOSITS OR OBLIGATIONS OF ANY BANK.
. NOT ENDORSED OR GUARANTEED BY ANY BANK.
. NOT INSURED OR OTHERWISE PROTECTED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER AGENCY.
. SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL
AMOUNT.

Keep This Prospectus For Future Reference

EVERGREENSM is a Service Mark of Evergreen Asset Management Corp.
Copyright 1995, Evergreen Asset Management Corp.
<PAGE>

TABLE OF CONTENTS

<TABLE>
<S> <C>
EXPENSES.............................................................. 3
FINANCIAL HIGHLIGHTS.................................................. 4
FUND DESCRIPTIONS..................................................... 5
Investment Objectives.............................................. 5
Securities and Investment Practices................................ 5
BUYING AND SELLING SHARES............................................. 7
How To Buy Shares.................................................. 7
How To Redeem Shares............................................... 7
Additional Transaction Policies.................................... 8
Exchanges........................................................... 9
Dividends........................................................... 9
Taxes............................................................... 9
Shareholder Services................................................ 10
FUND DETAILS........................................................... 10
Fund Organization and Service Providers............................. 10
Other Information And Policies...................................... 11
Fund Performance.................................................... 12
</TABLE>

2
<PAGE>

- -------------------------------------------------------------------------------

EXPENSES

- -------------------------------------------------------------------------------

<TABLE>
<CAPTION>
TOTAL OPERATING
MANAGEMENT FEES EXPENSES (AFTER
ANNUAL FUND OPERATING EXPENSES (AFTER EXPENSE 12B-1 OTHER EXPENSE
(AS A PERCENTAGE OF AVERAGE DAILY NET ASSETS) WAIVERS)(1) FEES EXPENSES WAIVERS)(1)
- --------------------------------------------- --------------- ------- -------- ---------------
<S> <C> <C> <C> <C>
Evergreen Select Large Cap
Blend Fund 0.58% None 0.13% 0.71%
Evergreen Select Social
Principles Fund 0.67% None 0.19% 0.86%
<CAPTION>

EXAMPLE OF FUND EXPENSES 1 YEAR 3 YEARS 5 YEARS 10 YEARS
------------------------ ------ ------- ------- --------
<S> <C> <C> <C> <C>
Evergreen Select Large Cap
Blend Fund $7 $23 $40 $88
Evergreen Select Social
Principles Fund $9 $27 $48 $106
</TABLE>
- -------
(1) Each Fund's investment advisor has voluntarily agreed to waive a portion
of the Fund's investment advisory fee. The investment advisors currently
intend to continue this expense waiver indefinitely; however, each may
modify or cancel its expense waiver at any time. See "Fund Details" for
more information. Absent expense waivers and/or reimbursements, the Total
Operating Expenses for each of the Funds would be as follows:

<TABLE>
<CAPTION>
MANAGEMENT FEE OTHER TOTAL FUND
FUND (WITHOUT WAIVERS) EXPENSES OPERATING EXPENSES
- ---- ----------------- -------- ------------------
<S> <C> <C> <C>
Evergreen Select Large Cap Blend
Fund 0.70% 0.13% 0.83%
Evergreen Select Social
Principles Fund 0.80% 0.19% 0.99%
</TABLE>

3
<PAGE>

- -------------------------------------------------------------------------------

FINANCIAL HIGHLIGHTS

- -------------------------------------------------------------------------------

The tables below present, for each Fund, financial highlights for a share
outstanding throughout the period indicated. The information in the tables has
been audited by the Funds' independent auditor, KPMG Peat Marwick LLP. The
report of KPMG Peat Marwick LLP on the audited information is included in the
Fund's Annual Report which is incorporated by reference into the Funds' SAI.
The following information for each Fund should be read in conjunction with the
financial statements and related notes, which are incorporated by reference
into the SAI.

Further information about a Fund's performance is contained in the Funds'
annual report to shareholders, which may be obtained without charge.

EVERGREEN SELECT LARGE CAP BLEND FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $45.05
--------
Income from investment
operations
Net investment income... 0.23
Net realized and
unrealized gain on
investments............ 5.70
--------
Total from investment
operations.............. 5.93
--------
Distributions to
shareholders
From net investment
income................. (0.23)
In excess of net
investment income...... (0.01)
--------
Total distributions...... (0.24)
--------
Net asset value end of
period.................. $50.74
========
TOTAL RETURN............. 13.18%
RATIOS/SUPPLEMENTAL DATA
Ratios to average net
assets:
Total expenses.......... 0.71%+
Total expenses,
excluding indirectly
paid expenses.......... 0.71%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.83%+
Net investment income... 0.80%+
Portfolio turnover rate.. 42%
Average commission rate
per share............... $0.0591
NET ASSETS END OF PERIOD
(THOUSANDS)............. $497,534
</TABLE>
- -------
+ Annualized.
* For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.

EVERGREEN SELECT SOCIAL PRINCIPLES FUND

<TABLE>
<CAPTION>
PERIOD ENDED
JUNE 30, 1998*
--------------
<S> <C>
NET ASSET VALUE BEGINNING
OF PERIOD............... $36.65
--------
Income (loss) from
investment operations
Net investment income
(loss)................. 0.03
Net realized and
unrealized gain on
investments............ 2.31
--------
Total from investment
operations.............. 2.34
--------
Distributions to
shareholders
From net investment
income................. (0.03)
In excess of net
investment income...... (0.01)
--------
Total distributions...... (0.04)
--------
Net asset value end of
period.................. $38.95
========
TOTAL RETURN............. 6.38%
RATIOS/SUPPLEMENTAL DATA
Ratios to average net
assets:
Total expenses.......... 0.86%+
Total expenses,
excluding indirectly
paid expenses.......... 0.86%+
Total expenses,
excluding fee waiver
and expense
reimbursement.......... 0.99%+
Net investment income
(loss)................. 0.12%+
Portfolio turnover rate.. 24%
Average commission rate
per share............... $0.0585
NET ASSETS END OF PERIOD
(THOUSANDS)............. $177,187
</TABLE>
- -------
+ Annualized.
* For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.

4
<PAGE>

- -------------------------------------------------------------------------------

FUND DESCRIPTIONS

- -------------------------------------------------------------------------------

INVESTMENT OBJECTIVES

Each Fund's investment objective is nonfundamental. As a result, a Fund
may change its objective without a shareholder vote. Each Fund has also
adopted certain fundamental investment policies which are mainly designed to
limit a Fund's exposure to risk. A Fund's fundamental policies cannot be
changed without a shareholder vote. See the SAI for more information regarding
a Fund's fundamental investment policies or other related investment policies.

EVERGREEN SELECT LARGE CAP BLEND FUND seeks to achieve long-term capital
growth. The Fund invests at least 65% of its total assets in the equity
securities of large companies (i.e., a company with a market capitalization of
over $5 billion at the time of investment). The Fund's stock selection is
based on a diversified style of equity management that allows it to invest in
both value and growth-oriented equity securities.

EVERGREEN SELECT SOCIAL PRINCIPLES FUND seeks to provide long-term
capital growth. The Fund invests in the equity securities of mid-size
companies (i.e., a company with a market capitalization of more than $1
billion but less than $5 billion) that respect human rights, play a role in
local communities and produce useful products in an environmentally sound way.
The Fund will not invest in companies that produce liquor, tobacco, weapons or
nuclear energy.

SECURITIES AND INVESTMENT PRACTICES

Equity Securities. Each Fund invests primarily in common stocks. A common
stock represents an equity (ownership) interest in a corporation. The Fund
expects to profit from stocks primarily by (1) selling shares at a higher
price than it paid and (2) earning dividends.

Investments in stocks are subject to market risk, which is the
possibility that stock prices in general will decline over short or even
extended periods. Stock markets tend to move in cycles, with periods of rising
stock prices and periods of falling stock prices. Also, investing in mid-sized
companies involves greater risk than investing in larger companies. Mid-sized
company stock prices can rise very quickly and drop dramatically in a short
period of time. This volatility results from a number of factors, including
reliance by such companies on limited product lines, markets, and financial
and management resources. These and other factors may make mid-sized companies
more susceptible to setbacks or downturns. These companies may experience
higher rates of bankruptcy or other failures than larger companies. They may
be more likely to be negatively affected by changes in management. In
addition, the stock of mid-sized companies may be less marketable than larger
companies.

5
<PAGE>

Futures Contracts and Options Transactions. The Funds may buy and sell futures
and options on futures relating to, (i) individual securities; and (ii)
indices. Such transactions may be entered into in order to hedge against
declines in markets and to gain exposure to markets prior to buying individual
securities. Futures contracts provide for the future sale by one party and
purchase by another party of a specified amount of a specified security at a
specified future time and at a specified price.

The Funds may not use futures contracts or options transactions to
leverage their net assets for speculative purposes. See "Futures Transactions
and Related Options Transactions" in the SAI.

6
<PAGE>

accrues to a Fund until settlement. At the time of settlement, a when-issued
security may be valued at less than its purchase price. When entering into
these transactions, a Fund relies on the other party to consummate the
transaction; if the other party fails to do so, the Fund may be disadvantaged.
Each Fund does not intend to purchase when-issued securities for speculative
purposes, but only in furtherance of its investment objective.

Temporary Defensive Investments. Each Fund may invest for temporary defensive
purposes up to 100% of its assets in short-term obligations. Such obligations
may include master demand notes, commercial paper and notes, bank deposits and
other financial institution obligations.

Other Investment Restrictions. Each Fund has adopted additional investment
restrictions and guidelines that are set forth in the SAI.

- -------------------------------------------------------------------------------

BUYING AND SELLING SHARES

- -------------------------------------------------------------------------------

HOW TO BUY SHARES

Charitable investors may buy Charitable Shares of the Funds through
broker-dealers, banks and certain other financial intermediaries, or directly
through the Fund's distributor, Evergreen Distributor, Inc. ("EDI"). A
charitable investor is one that qualifies as a non-profit organization under
the Internal Revenue Code of 1986, as amended (the "Code"). Examples of such
organizations include charitable trusts, non-profit hospitals, private
foundations, private schools and colleges, public charities, religious
entities and charitable remainder trusts. Investors may purchase Charitable
Shares at the public offering price, which equals the class' net asset value
per share ("NAV"). See "Offering Price and Other Purchase Information" below.

Minimum Investment. The minimum initial investment in Charitable Shares is $1
million, which may be waived in certain situations. There is no minimum amount
required for subsequent purchases.

HOW TO REDEEM SHARES

7
<PAGE>

Mail Redemptions. You may redeem shares on each day that the New York Stock
Exchange ("NYSE") is open by mailing a written request to the Service Company
at the following address:

Evergreen Service Company
P.O. Box 2121
Boston, Massachusetts 02106-2121

The signatures on the written request must be properly guaranteed, as
described below.

If you are unable to reach the Funds or the Service Company by telephone,
you should redeem by mail.

ADDITIONAL TRANSACTION POLICIES

8
<PAGE>

Company's policies. The Service Company may waive this requirement or may
require additional documentation in certain cases.

EXCHANGES

You may exchange Charitable Shares of any Fund for Charitable Shares of
any other Evergreen Select fund. You may exchange your shares through your
broker-dealer, by mail or by telephone. All exchange orders must comply with
the applicable requirements for purchases and redemptions and must include
your account number, the number or value of shares to be exchanged, the class
of shares, and the funds to and from which you wish to exchange.

Signatures on exchange orders must be guaranteed, as described above.

Please read the prospectus of the fund that you want to exchange into
before requesting your exchange.

For federal income tax purposes, an exchange is treated as a sale for
taxable investors.

DIVIDENDS

Dividend Schedule. Each Fund declares and pays dividends from its net
investment income monthly. Each Fund pays shareholders its net capital gains
at least once a year.

Payment Options. Unless you select another option on your account application,
your dividends and capital gains will be reinvested in additional shares of
the same class of the same Fund.

TAXES

Each Fund has qualified and intends to continue to qualify as a regulated
investment company (a "RIC") under Subchapter M of the Code, as amended. As
long as a Fund qualifies as a RIC and distributes substantially all of its net
investment income and capital gains, it will not pay federal income taxes on
the earnings it distributes to shareholders.

Distributions to shareholders, whether taken in cash or reinvested in
shares, are generally considered taxable for federal income tax purposes as
follows:

. Income distributions and net short-term capital gains distributions are
taxable as ordinary income.

. Long-term capital gains distributions are taxable as capital gains,
regardless of how long you have held your shares.

9
<PAGE>

SHAREHOLDER SERVICES

Details on all shareholder services may be obtained from the Service
Company by calling toll-free 1-800-343-2898 or by writing to the Service
Company.

Subaccounts. Special processing has been arranged with the Service Company for
banks and other institutions that wish to open multiple accounts (a master
account and subaccounts). An investor wishing to avail itself of the Service
Company's subaccounting facilities will be required to enter into a separate
agreement, with the charges to be determined on the basis of the level of
services to be rendered. Subaccounts may be opened with the initial investment
or at a later date and may be established by an investor with registration
either by name or by number.

- -------------------------------------------------------------------------------

FUND DETAILS

- -------------------------------------------------------------------------------

FUND ORGANIZATION AND SERVICE PROVIDERS

Board of Trustees. The Trust is supervised by a Board of Trustees that is
responsible for representing the interests of shareholders. The Trustees meet
periodically throughout the year to oversee the Funds' activities, reviewing,
among other things, the Funds' performance and their contractual arrangements
with various service providers.

The Funds do not hold annual shareholder meetings; a Fund may, however,
hold special meetings for such purposes as electing or removing Trustees,
changing fundamental policies and approving investment advisory agreements. In
addition, the Funds are prepared to assist shareholders in communicating with
one another for the purpose of convening a meeting to elect Trustees.

Advisor. The investment advisor to each Fund is First Union National Bank
("FUNB"), a subsidiary of First Union Corporation ("First Union"). First Union
is located at 301 South College Street, and FUNB at 201 South College Street,
Charlotte, North Carolina 28288-0630. First Union and its subsidiaries provide
a broad range of financial services to individuals and businesses throughout
the U.S.

Each Fund pays FUNB a fee for its services as set forth below. FUNB
annual advisory fees are expressed as a percentage of average net assets. In
addition, FUNB has voluntarily agreed to reduce its advisory fee for each Fund
it advises, resulting in the net advisory fees that are also indicated in the
table below.

<TABLE>
<CAPTION>
FUND ADVISORY FEE NET ADVISORY FEE
---- ------------ ----------------
<S> <C> <C>
Evergreen Select Large Cap Blend Fund 0.70% 0.58%
Evergreen Select Social Principles Fund 0.80% 0.67%
</TABLE>

FUNB currently intends to continue indefinitely waiving a portion of each
Fund's respective advisory fee. However, FUNB may modify or cancel its expense
waiver at any time.

Portfolio Managers. Information about the individual portfolio managers
responsible for managing each Fund, including their occupations for the past
five years, is provided below.

10
<PAGE>

<TABLE>
<CAPTION>
FUND PORTFOLIO MANAGER(S)
---- --------------------
<C> <S>
Evergreen Select Large Cap Blend Fund Eric M. Wiegand. Eric Wiegand has
managed the Fund since 1996 and is
assisted by a team of seasoned
investment professionals. Mr. Wiegand
is a Senior Vice President and Senior
Portfolio Manager, also responsible
for managing the Evergreen Select
Social Principles Fund. Prior to
rejoining First Fidelity Bank in 1994,
which was acquired by FUNB in 1995,
Mr. Wiegand was an Assistant Vice
President and Portfolio Manager with
First Fidelity Bank from 1989-1993.
Evergreen Select Social Principles Fund Mr. Wiegand also acts as portfolio
manager of the Evergreen Select Large
Cap Blend Fund.
</TABLE>

<TABLE>
<CAPTION>
AGGREGATE AVERAGE DAILY NET ASSETS OF MUTUAL FUNDS FOR WHICH ANY
ADMINISTRATIVE FEE AFFILIATE OF FUNB SERVES AS INVESTMENT ADVISOR
------------------ ----------------------------------------------------------------
<S> <C>
0.050% on the first $7 billion
0.035% on the next $3 billion
0.030% on the next $5 billion
0.020% on the next $10 billion
0.015% on the next $5 billion
0.010% on assets in excess of $30 billion
</TABLE>

OTHER INFORMATION AND POLICIES

11
<PAGE>

Portfolio Turnover. Each Fund's annual portfolio turnover rate is not expected
to exceed 75%. The Funds' actual portfolio turnover rates are set forth under
"Financial Highlights."

Code of Ethics. Each Fund and FUNB have adopted a code of ethics incorporating
policies on personal securities trading. In general, these codes of ethics
require that certain personnel of the Funds and FUNB (1) abstain from engaging
in certain personal trading practices and (2) report certain personal trading
activities.

Other Classes of Shares. Each Fund offers three classes of shares, Charitable,
Institutional and Institutional Service. Only Charitable Shares are offered
through this prospectus. Call the Service Company at 1-800-343-2898 for
information on the other classes of shares, including how to get a prospectus.

Year 2000 Risks. Like other investment companies, financial and business
organizations and individuals around the world, the Funds could be adversely
affected if the computer systems used by the Funds' investment advisor and the
Funds' other service providers do not properly process and calculate date-
related information and data from and after January 1, 2000. This is commonly
known as the "Year 2000 Problem." The Funds' investment advisor is taking
steps to address the Year 2000 Problem with respect to the computer systems
that it uses and to obtain assurances that comparable steps are being taken by
the Funds' other major service providers. At this time, however, there can be
no assurance that these steps will be sufficient to avoid any adverse impact
on the Funds.

FUND PERFORMANCE

Related Performance Information. EVERGREEN SELECT LARGE CAP BLEND FUND and
EVERGREEN SELECT SOCIAL PRINCIPLES FUND commenced operations on or about
November 24, 1997. On that date, two common trust funds (each a "CTF")
transferred substantially all their assets to Funds having materially
equivalent investment objectives, policies and limitations in exchange for
shares of those Funds. After such transfer, each Fund's portfolio of
investments was the same as the portfolio of the corresponding CTF immediately
prior to the transfer. The performance information below is that of the CTFs
and not the Funds. Past performance is not a guarantee of future performance.

The CTFs are for all practical purposes "predecessors" of the Funds. As a
result, the performance for each Fund's Charitable Shares is calculated for
periods commencing before October 31, 1997, by including the corresponding
CTF's average annual total return. The CTFs' average annual total return is
adjusted to reflect the deduction of fees and expenses stated under
"Expenses." These fees and expenses include management fees and certain other
Fund expenses. These fees and expenses have not, however, been adjusted to
reflect any expense waivers or reimbursements.

The quoted performance data includes the performance of the CTFs for
periods before the Trust's Registration Statement became effective. The CTFs
were not registered under the 1940 Act and thus were not

12
<PAGE>

subject to certain investment restrictions that are imposed by the Investment
Company Act of 1940 (the "1940 Act"). If the CTFs had been registered under
the 1940 Act, their performance might have been adversely affected. In
addition, the CTFs were not subject to the provisions of the Code with respect
to "regulated investment companies," which provisions, if imposed, could have
adversely affected the CTFs' performance. Employee benefit plans that invest
plan assets in the CTFs may be subject to certain charges as set forth in
their respective Plan Documents. Total return figures would be lower for the
period if they reflected these charges.

<TABLE>
<CAPTION>
10 YEARS
(OR SINCE INCEPTION
FUND NAME (PREDECESSOR CTF) 1 YEAR 3 YEARS 5 YEARS INCEPTION) DATE
--------------------------- ------ ------- ------- ---------- ---------
<S> <C> <C> <C> <C> <C>
Evergreen Select Large Cap Blend
Fund
(Charitable Equity Trust)
Charitable Shares 29.69% 30.01% N/A 22.12% 12/31/93
Evergreen Select Social
Principles Fund
(Social Principles Trust)
Charitable Shares 28.33% 24.80% 18.98% 15.30% 5/31/88
</TABLE>

For more information on the Funds' performance, see the SAI.

13
<PAGE>

INVESTMENT ADVISERS
First Union National Bank, 201 South College Street, Charlotte, North Carolina
28288-0630

CUSTODIAN
State Street Bank and Trust Company, Box 9021, Boston, Massachusetts 02205-9827

TRANSFER AGENT
Evergreen Service Company, 200 Berkeley Street, Boston, Massachusetts 02116-
5034

LEGAL COUNSEL
Sullivan & Worcester LLP, 1025 Connecticut Avenue, N.W., Washington, D.C. 20036

INDEPENDENT AUDITORS
KPMG Peat Marwick LLP, 99 High Street, Boston, Massachusetts 02110

DISTRIBUTOR
Evergreen Distributor, Inc., 125 West 55th Street, New York, New York 10019

38114 541916
<PAGE>
<PAGE>

-------------------------------------------------------------------------------
PROSPECTUS November 1, 1998
-------------------------------------------------------------------------------

[LOGO OF EVERGREEN FUNDS APPEARS HERE]

EVERGREEN SELECT EQUITY TRUST
-------------------------------------------------------------------------------

EVERGREEN SELECT EQUITY INDEX FUND
(THE "FUND")

CLASS A SHARES
CLASS B SHARES

This prospectus explains important information about the Class A and
Class B shares of Evergreen Select Equity Index Fund, including information on
how the Fund invests and services available to shareholders. Please read this
prospectus before investing, and keep it for future reference.

When you consider investing in the Fund, remember that the higher the
risk of losing money, the higher the potential reward. The reverse is also
generally true: the lower the risk, the lower the potential reward.

By itself, no Fund is a complete investment plan. When considering an
investment in the Fund, remember to consider your overall investment
objectives and any other investments you own. You should also carefully
evaluate your ability to handle the risks posed by your investment in the
Fund. You can find information on the risks associated with investing in the
Fund under the section called "Fund Description."

To learn more about the Evergreen Select Equity Trust, call 1-800-343-
2898 for a free copy of the Fund's statement of additional information ("SAI")
dated November 1, 1998, as supplemented from time to time. The Fund has filed
the SAI with the Securities and Exchange Commission ("SEC") and has
incorporated it by reference (legally included it) into this prospectus.

PLEASE REMEMBER THAT SHARES OF THE FUND ARE:

. NOT DEPOSITS OR OBLIGATIONS OF ANY BANK.

. NOT ENDORSED OR GUARANTEED BY ANY BANK.

. NOT INSURED OR OTHERWISE PROTECTED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER AGENCY.

. SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL
AMOUNT.

Keep This Prospectus For Future Reference.

EVERGREENSM is a Service Mark of Evergreen Asset Management Corp.
Copyright 1995, Evergreen Asset Management Corp.
<PAGE>

TABLE OF CONTENTS

<TABLE>
<S> <C>
EXPENSES................................ 3
FUND DESCRIPTION........................ 4
Investment Objective................. 4
Securities and Investment Practices.. 4
BUYING AND SELLING SHARES............... 6
How To Buy Shares.................... 6
How to Redeem Shares................. 9
Exchanges............................ 10
Shareholder Services................. 11
Dividends and Distributions.......... 12
Taxes................................ 12
FUND DETAILS............................ 13
Fund Organization and Service
Providers........................... 13
Distribution Plans and Agreements.... 14
Other Information And Policies....... 15
Fund Performance..................... 15
</TABLE>

2
<PAGE>

-------------------------------------------------------------------------------

EXPENSES

-------------------------------------------------------------------------------

The tables and examples below are designed to help you understand the
various expenses that you will bear, directly or indirectly, when you invest
in the Fund. Shareholder transaction expenses are fees paid directly from your
account when you buy or sell shares of the Fund.

SHAREHOLDER TRANSACTION EXPENSES

<TABLE>
<CAPTION>
CLASS A SHARES CLASS B SHARES
-------------- --------------
<S> <C> <C>
Maximum Sales Charge Imposed on Purchases (as a
% of offering price) 4.75% None
Contingent Deferred Sales Charge (as a % of
original purchase price or redemption
proceeds, whichever is lower) None(1) 5.00%(2)(3)
</TABLE>
-------
(1) Investments of $1 million or more are not subject to a front-end sales
charge, but may be subject to a contingent deferred sales charge upon
redemption within one year after the month of purchase.
(2) The deferred sales charge on Class B shares declines from 5% to 1% on
amounts redeemed within six years after the month of purchase. No sales
charge is imposed on redemptions made thereafter. See "Purchase and
Redemption of Shares" for more information.
(3) Long-term shareholders may pay more than the economic equivalent front-end
sales charges permitted by the National Association of Securities Dealers,
Inc.

Annual operating expenses reflect the normal operating expenses of the
Fund, and include costs such as management, distribution and other fees. The
tables below show the Fund's estimated annual operating expenses for the
fiscal year ending June 30, 1999. The example shows what your costs would be
for a hypothetical $1,000 investment over the periods indicated. The example
assumes that you reinvest all of your dividends and that the Fund's average
annual return will be 5%. THE EXAMPLE IS FOR ILLUSTRATION PURPOSES ONLY AND
SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE EXPENSES OR ANNUAL
RETURN. THE FUND'S ACTUAL EXPENSES AND RETURNS WILL VARY. For a more complete
description of the various costs and expenses borne by the Fund see
"Organization and Service Providers."

<TABLE>
<CAPTION>
ANNUAL OPERATING EXPENSES
-------------------------
CLASS A CLASS B
------- -------
<S> <C> <C> <C>
Management Fees
(after waiver)(4) 0.12% 0.12%
12b-1 Fees(5) 0.25% 1.00%
Other Expenses 0.18% 0.18%
---- ----
Total 0.55% 1.30%
==== ====
</TABLE>
<TABLE>
<CAPTION>
EXAMPLE
-------
ASSUMING REDEMPTION AT ASSUMING NO
END OF PERIOD REDEMPTION
----------------------- -----------
CLASS A CLASS B CLASS B
----------- ----------- -----------
<S> <C> <C> <C>
After 1 Year $ 53 $ 63 $13
After 3 Years $ 64 $ 71 $41
</TABLE>

-------
(4) The investment advisor of the Fund has voluntarily agreed to waive a
portion of the Fund's investment advisory fee. Without such waiver, the
management fee set forth above would be higher. The investment advisor
currently intends to continue this expense waiver indefinitely; however,
the advisor may modify or cancel its expense waiver at any time. See "Fund
Details" for more information.
(5) Although Class A shares can pay up to 0.75% of average net assets as a
12b-1 fee, for the foreseeable future such fees have been limited to 0.25%
of average net assets. For Class B shares, a portion of the 12b-1 fees
equivalent to 0.25% of average annual assets will be shareholder
servicing-related. Distribution-related 12b-1 fees will be limited to
0.75% of average annual assets as permitted under the rules of the
National Association of Securities Dealers, Inc. ("NASD").

Absent expense waivers the Total Operating Expenses for the Fund would be
as follows:

<TABLE>
<CAPTION>
MANAGEMENT FEE TOTAL FUND
(WITHOUT WAIVERS) 12B-1 FEES OTHER EXPENSE OPERATING EXPENSES
----------------- ---------- ------------- ------------------
<S> <C> <C> <C> <C>
Class A Shares 0.40% 0.25% 0.18% 0.83%
Class B Shares 0.40% 1.00% 0.18% 1.58%
</TABLE>

3
<PAGE>

-------------------------------------------------------------------------------

FUND DESCRIPTION

-------------------------------------------------------------------------------

INVESTMENT OBJECTIVE

The Fund's investment objective is nonfundamental. As a result, the Fund
may change its objective without a shareholder vote. The Fund has also adopted
certain fundamental investment policies which are mainly designed to limit the
Fund's exposure to risk. The Fund's fundamental policies cannot be changed
without a shareholder vote. See the SAI for more information regarding the
Fund's fundamental investment policies or other related investment policies.

The Fund seeks investment results that achieve price and yield
performance similar to the Standard & Poor's Corporation 500 Index ("S&P 500
Index"). The Fund invests primarily in stocks represented in the S&P 500
Index.

SECURITIES AND INVESTMENT PRACTICES

You can find more information about the types of securities in which the
Fund may invest, the types of investment techniques the Fund may employ in
pursuit of its objective and a summary of related risks set forth below. The
Fund's SAI contains additional information about these investments and
investment techniques.

Equity Securities. The Fund invests primarily in common stocks. A common stock
represents an equity (ownership) interest in a corporation. The Fund expects
to profit from stocks primarily by (1) selling shares at a higher price than
it paid and (2) earning dividends.

The Fund invests at least 90% of its total assets in equity securities
that represent a composite of the S&P 500 Index. The S&P 500 Index consists of
500 common stocks, most of which are listed on the New York Stock Exchange. In
choosing the 500 stocks which are included in the S&P 500 Index, S&P considers
market values and industry diversification. The correlation between the
performance of the Fund and the S&P 500 Index is expected to be, before
expenses, 0.98 or higher. A correlation of 1.00 would indicate perfect
correlation.

The Fund's investment portfolio will generally consist of common stocks
of as many issuers listed in the S&P 500 Index as is feasible. The Fund's
investment advisor uses a computer model that closely monitors the industry
weightings of the S&P 500 Index. Although the Fund's investment advisor does
not screen securities by traditional methods of financial and market analyses,
it monitors the Fund's investments with a view toward removing stocks of
companies which exhibit extreme financial distress or which may impair the
Fund's ability to achieve its investment objective. The Fund strives to
provide a total return comparable to the S&P 500 Index. The Fund is not
sponsored by nor affiliated with S&P.

4
<PAGE>

and call options, write covered put and call options, enter into futures
contracts and use options on futures contracts. The Fund may use futures and
options for hedging purposes only, not for speculation.

Losses from derivatives can sometimes be substantial. This is true partly
because small price movements in the underlying asset can result in immediate
and substantial gains or losses in the value of the derivative. Derivatives
can also cause the Fund to lose money if the Fund fails to correctly predict
the direction in which the underlying asset or economic factor will move. See
"Futures Transactions and Related Options Transactions" in the SAI.

Futures Contracts and Options Transactions. The Fund may buy and sell futures
and options on futures relating to, (i) individual securities; and (ii)
indices. Such transactions may be entered into in order to hedge against
declines in markets and to gain exposure to markets prior to buying individual
securities. Futures contracts provide for the future sale by one party and
purchase by another party of a specified amount of a specified security at a
specified future time and at a specified price.

The Fund may not use futures contracts or options transactions to
leverage its net assets for speculative purposes. See "Futures Transactions
and Related Options Transactions" in the SAI.

Borrowing. The Fund may borrow from banks in an amount up to 33 1/3% of its
total assets, taken at market value. The Fund may also borrow an additional 5%
of its total assets from banks and others. The Fund may only borrow as a
temporary measure for extraordinary or emergency purposes such as the
redemption of Fund shares. The Fund may purchase additional securities so long
as borrowings do not exceed 5% of its total assets.

Securities Lending. To generate income and offset expenses, the Fund may lend
portfolio securities to broker-dealers and other financial institutions. Loans
of securities by the Fund may not exceed 33 1/3% of the value of the Fund's
total assets. While securities are on loan, the borrower will pay the Fund any
income accruing on the security. Also, the Fund may invest any collateral it
receives in additional securities.

Gains or losses in the market value of a lent security will affect the
Fund and its shareholders. When the Fund lends its securities, it runs the
risk that it could not retrieve the securities on a timely basis, possibly
losing the opportunity to sell the securities at a desirable price. Also, if
the borrower files for bankruptcy or becomes insolvent, the Fund's ability to
dispose of the securities may be delayed.

Repurchase Agreements. The Fund may enter into repurchase agreements. A
repurchase agreement is an agreement by the Fund to purchase a security and
sell it back for a specified price. The repurchase price reflects an agreed-
upon interest rate for the time period of the agreement. The Fund's risk is
the inability of the seller to pay the agreed-upon price at delivery date.
However, such risk is tempered by the ability of the Fund to sell the security
in the open market in case of default. In such a case, the Fund may incur
costs in disposing of the security which would increase Fund expenses. The
Fund's investment advisor will monitor the creditworthiness of the firms with
which the Fund enters into repurchase agreements.

Reverse Repurchase Agreements. The Fund may enter into reverse repurchase
agreements. A reverse repurchase agreement is an agreement by the Fund to sell
a security and repurchase it at a specified time and price. The Fund could
lose money if the market value of the securities it sold declines below their
repurchase price. Reverse repurchase agreements may be considered a form of
borrowing, and, therefore, a form of leverage. Leverage may magnify gains or
losses of the Fund.

Investing in Securities of Other Investment Companies. The Fund may invest in
securities of other investment companies. As a shareholder of another
investment company, the Fund would pay its portion of the other

5
<PAGE>

investment company's expenses. These expenses would be in addition to the
expenses that the Fund currently bears concerning its own operations and may
result in some duplication of fees.

When-Issued, Delayed-Delivery and Forward Commitment Transactions. The Fund
may enter into transactions whereby it commits to buying a security, but does
not pay for or take delivery of the security until some specified date in the
future. The value of these securities is subject to market fluctuation during
this period and no income accrues to the Fund until settlement. At the time of
settlement, a when-issued security may be valued at less than its purchase
price. When entering into these transactions, the Fund relies on the other
party to consummate the transaction; if the other party fails to do so, the
Fund may be disadvantaged. The Fund does not intend to purchase when-issued
securities for speculative purposes, but only in furtherance of its investment
objective.

Temporary Defensive Investments. The Fund may invest for temporary defensive
purposes up to 100% of its assets in short-term obligations. Such obligations
may include U.S. government securities, master demand notes, commercial paper
and notes, bank deposits and other financial institution obligations.

Other Investment Restrictions. The Fund has adopted additional investment
restrictions and guidelines that are set forth in the SAI.

-------------------------------------------------------------------------------

BUYING AND SELLING SHARES

-------------------------------------------------------------------------------

HOW TO BUY SHARES

You may purchase shares of the Fund through broker-dealers, banks or
other financial intermediaries, or directly through the Fund's distributor,
Evergreen Distributor, Inc. ("EDI"). In addition, you may purchase shares of
the Fund by mailing to the Fund, c/o Evergreen Service Company, P.O. Box 2121,
Boston, Massachusetts 02106-2121, a completed application and a check payable
to the Fund. You may also telephone 1-800-343-2898 to obtain the number of an
account to which you can wire or electronically transfer funds and then send
in a completed application. Subsequent investments in any amount may be made
by check, by wiring federal funds, by direct deposit or by an electronic funds
transfer.

The minimum initial investment is $1,000, which may be waived in certain
situations. There is no minimum amount for subsequent investments. Investments
of $25 or more are allowed under the Systematic Investment Plan. See the
application for more information. Only Class A and Class B shares are offered
through this prospectus (see "General Information" -- "Other Classes of
Shares").

Class A Shares -- Front-End Sales Charge Alternative. You may purchase Class A
shares of the Fund at net asset value ("NAV") plus an initial sales charge on
purchases under $1,000,000. You may purchase $1,000,000 or more of Class A
shares without a front-end sales charge; however, a contingent deferred sales
charge ("CDSC") equal to the lesser of 1% of the purchase price or the
redemption value will be imposed on shares redeemed during the month of
purchase and the 12-month period following the month of purchase. The schedule
of charges for Class A shares is as follows:

INITIAL SALES CHARGE

<TABLE>
<CAPTION>
AS A % OF THE NET AS A % OF THE COMMISSION TO DEALER/AGENT
AMOUNT OF PURCHASE AMOUNT INVESTED OFFERING PRICE AS A % OF OFFERING PRICE
------------------ ----------------- -------------- --------------------------
<S> <C> <C> <C>
Less than $ 50,000..... 4.99% 4.75% 4.25%
$ 50,000--$ 99,999...... 4.71% 4.50% 4.25%
$100,000--$249,999...... 3.90% 3.75% 3.25%
$250,000--$499,999...... 2.56% 2.50% 2.00%
$500,000--$999,999...... 2.04% 2.00% 1.75%
$1,000,000 or more...... None None 1.00% of the amount invested
up to $2,999,999; 0.50% of the amount
invested over $2,999,999, up to $4,999,999;
and 0.25% of the excess over $4,999,999
</TABLE>

6
<PAGE>

No front-end sales charges are imposed on Class A shares purchased by (a)
institutional investors, which may include bank trust departments and
registered investment advisors; (b) investment advisors, consultants or
financial planners who place trades for their own accounts or the accounts of
their clients and who charge such clients a management, consulting, advisory
or other fee; (c) clients of investment advisors or financial planners who
place trades for their own accounts if the accounts are linked to the master
account of such investment advisors or financial planners on the books of the
broker-dealer through whom shares are purchased; (d) institutional clients of
broker-dealers, including retirement and deferred compensation plans and the
trusts used to fund these plans, which place trades through an omnibus account
maintained with the Fund by the broker-dealer; (e) shareholders of record on
October 12, 1990 in any series of Evergreen Investment Trust in existence on
that date, and the members of their immediate families; (f) current and
retired employees of First Union National Bank ("FUNB") and its affiliates,
EDI and any broker-dealer with whom EDI has entered into an agreement to sell
shares of the Fund, and members of the immediate families of such employees;
(g) and upon the initial purchase of an Evergreen fund by investors
reinvesting the proceeds from a redemption within the preceding 30 days of
shares of other mutual funds, provided such shares were initially purchased
with a front-end sales charge or subject to a contingent deferred sales charge
("CDSC"); and (h) all qualified plan customers holding Evergreen Class Y
shares in connection with a rollover into an individual retirement account.
Certain broker-dealers or other financial institutions may impose a fee on
transactions in shares of the Fund.

Class A shares may also be purchased at NAV by a corporation or certain
other qualified retirement plan or a non-qualified deferred compensation plan,
or a Title I tax sheltered annuity or TSA plan sponsored by an organization
having 100 or more eligible employees, or a TSA plan sponsored by a public
education entity having 5,000 or more eligible employees.

In connection with sales made to plans of the type described in the
preceding sentence EDI will pay broker-dealers and others concessions at the
rate of 0.50% of the NAV of the shares purchased. These payments are subject
to reclaim in the event the shares are redeemed within 12 months after
purchase.

Certain employer-sponsored retirement or savings plans, including
eligible 401(k) plans, may purchase Class A shares at NAV provided that such
plans meet a certain required minimum number of eligible employees or required
amount of assets. Additional information concerning the waiver of sales
charges is set forth in the SAI.

When Class A shares are sold, EDI will normally retain a portion of the
applicable sales charge and pay the balance to the broker-dealer or other
financial intermediary through whom the sale was made. EDI may also pay fees
to banks from sales charges for services performed on behalf of the customers
of such banks in connection with the purchase of shares of the Fund. In
addition to compensation paid at the time of sale, entities whose clients have
purchased Class A shares may receive a service fee equal to 0.25% of the
average daily value on an annual basis of Class A shares held by their
clients. Certain purchases of Class A shares may qualify for reduced sales
charges in accordance with a Fund's Concurrent Purchases, Rights of
Accumulation, Letter of Intent, certain Retirement Plans and Reinstatement
Privilege. See "Sales Charge Waivers or Reductions" in the SAI for additional
information concerning these reduced sales charges.

Class B Shares -- Deferred Sales Charge Alternative. You may purchase Class B
shares of the Fund at NAV without an initial sales charge. However, you may
pay a CDSC if you redeem shares within six years after the month of purchase.
The amount of the CDSC (expressed as a percentage of the lesser of the current
NAV or original cost) will vary according to the number of years from the
month of purchase of Class B shares as set forth below.

<TABLE>
<CAPTION>
CDSC
REDEMPTION TIMING IMPOSED
----------------- -------
<S> <C>
Month of purchase and the first 12-month period following the month of
purchase............................................................. 5.00%
Second 12-month period following the month of purchase................ 4.00%
Third 12-month period following the month of purchase................. 3.00%
Fourth 12-month period following the month of purchase................ 3.00%
Fifth 12-month period following the month of purchase................. 2.00%
Sixth 12-month period following the month of purchase................. 1.00%
No CDSC is imposed on amounts redeemed thereafter.
</TABLE>

7
<PAGE>

The CDSC is deducted from the amount of the redemption and is paid to
EDI. In the event the Fund acquires the assets of other mutual funds, the CDSC
may be paid by EDI to the distributors of the acquired funds. Class B shares
are subject to higher distribution and/or shareholder service fees than Class
A shares for a period of seven years after the month of purchase (after which
it is expected that they will convert to Class A shares without imposition of
a front-end sales charge). The higher fees mean a higher expense ratio, so
Class B shares pay correspondingly lower dividends and may have a lower NAV
than Class A shares. The Fund will not normally accept any purchase of Class B
shares in the amount of $250,000 or more.

At the end of the period ending seven years after the end of the calendar
month in which the shareholder's purchase order was accepted, Class B shares
will automatically convert to Class A shares and will no longer be subject to
a higher distribution services fee imposed on Class B shares. Such conversion
will be on the basis of the relative NAVs of the two classes, without the
imposition of any sales load, fee or other charge. The purpose of the
conversion feature is to reduce the distribution services fee paid by holders
of Class B shares that have been outstanding long enough for EDI to have been
compensated for the expenses associated with the sale of such shares. The CDSC
applicable to Class B shares will be waived on redemptions made by certain
employer-sponsored retirement or savings plans, including eligible 401(k)
plans. See "Sales Charge Waivers or Reductions" in the SAI for additional
information.

Contingent Deferred Sales Charge. Certain shares with respect to which the
Fund did not pay a commission on issuance, including shares obtained from
dividend or distribution reinvestment, are not subject to a CDSC. Any CDSC
imposed upon the redemption of Class A or Class B shares is a percentage of
the lesser of (1) the NAV of the shares redeemed or (2) the NAV at the time of
purchase of such shares.

No CDSC is imposed on a redemption of shares of the Fund in the event of
(1) death or disability of the shareholder; (2) a lump-sum distribution from a
401(k) plan or other benefit plan qualified under the Employee Retirement
Income Security Act of 1974 ("ERISA"); (3) automatic withdrawals from ERISA
plans if the shareholder is at least 59 1/2 years old; (4) involuntary
redemptions of accounts having an aggregate NAV of less than $1,000; (5)
automatic withdrawals under the Systematic Withdrawal Plan of up to 1.00% per
month of the shareholder's initial account balance; (6) withdrawals consisting
of loan proceeds to a retirement plan participant; (7) financial hardship
withdrawals made by a retirement plan participant; or (8) withdrawals
consisting of returns of excess contributions or excess deferral amounts made
to a retirement plan participant.

The Fund may also sell Class A or Class B shares at NAV without any
initial sales charge or a CDSC to certain Directors, Trustees, officers and
employees of the Fund, FUNB, EDI and certain of their affiliates, and to
members of the immediate families of such persons, to registered
representatives of firms with dealer agreements with EDI, and to a bank or
trust company acting as a trustee for a single account.

See "Sales Charge Waivers or Reductions" in the SAI for additional
information.

How the Funds Value Their Shares. The NAV of each class of shares of the Fund
is calculated by dividing the value of the amount of the Fund's net assets
attributable to that class by the number of outstanding shares of that class.
Shares are valued each day the New York Stock Exchange ("NYSE") is open as of
the close of regular trading (currently 4:00 p.m. eastern time). The
securities in the Fund are valued at their current market value determined on
the basis of market quotations or, if such quotations are not readily
available, such other methods as the Trustees believe would accurately reflect
fair value. Non-dollar denominated securities will be valued as of the close
of the NYSE at the closing price of such securities in their principal trading
markets.

General. The decision as to which class of shares is more beneficial to you
depends on the amount of your investment and the length of time you will hold
it. If you are making a large investment, thus qualifying for a reduced sales
charge, you might consider Class A shares. If you are making a smaller
investment, you might consider Class B shares since 100% of your purchase is
invested immediately and since such shares will convert to Class A shares,
which incur lower ongoing distribution and/or shareholder service fees, after
seven years. Consult your financial intermediary for further information. The
compensation received by broker-dealers and agents may differ depending on
whether they sell Class A or Class B shares. There is no size limit on
purchases of Class A shares.

8
<PAGE>

In addition to the discount or commission paid to broker-dealers, EDI may
from time to time pay to broker-dealers additional cash or other incentives
that are conditioned upon the sale of a specified minimum dollar amount of
shares of the Fund and/or other Evergreen funds. Such incentives will take the
form of payment for attendance at seminars, lunches, dinners, sporting events
or theater performances, or payment for travel, lodging and entertainment
incurred in connection with travel by persons associated with a broker-dealer
and their immediate family members to urban or resort locations within or
outside the U.S. Such a dealer may elect to receive cash incentives of
equivalent amount in lieu of such payments. EDI may also limit the
availability of such incentives to certain specified dealers. EDI from time to
time sponsors promotions involving First Union Brokerage Services, Inc., an
affiliate of the Fund's investment advisor, and select broker-dealers,
pursuant to which incentives are paid, including gift certificates and
payments in amounts up to 1% of the dollar amount of shares of the Fund sold.
Awards may also be made based on the opening of a minimum number of accounts.
Such promotions are not being made available to all broker-dealers. Certain
broker-dealers may also receive payments from EDI or the Fund's investment
advisor over and above the usual service fee or shareholder servicing payments
applicable to a given class of shares.

Additional Purchase Information. As a condition of this offering, if a
purchase is canceled due to nonpayment or because an investor's check does not
clear, the investor will be responsible for any loss the Fund or its
investment advisor incurs. If such investor is an existing shareholder, the
Fund may redeem shares from an investor's account to reimburse the Fund or its
investment advisor for any loss. In addition, such investor may be prohibited
or restricted from making further purchases in any of the Evergreen funds. The
Fund will not accept third party checks other than those payable directly to a
shareholder whose account has been in existence at least 30 days.

HOW TO REDEEM SHARES

You may redeem shares of the Fund by mail, telephone or other types of
telecommunication. Once a redemption request has been telephoned, mailed or
otherwise transmitted, it may not be changed or cancelled.

Mail Redemptions. You may redeem shares on each day that the NYSE is open by
mailing a written request to Evergreen Service Company (the "Service Company")
at the following address:

Evergreen Service Company
P.O. Box 2121
Boston, Massachusetts 02106-2121

The signatures on the written request must be properly guaranteed, as
described below.

If you are unable to reach the Fund or the Service Company by telephone,
you should redeem by mail.

Redemption Value and Other Redemption Policies. When you sell shares, you
receive the NAV computed at the close of the NYSE on the day that the Fund
receives your request, if your request is received before 4:00 p.m. eastern
time. If the Fund receives your redemption request after 4:00 p.m. eastern
time, you will receive the next day's NAV. Generally, the Fund pays redemption
proceeds within seven days. The Fund may, at any time, change, suspend or
terminate any of the redemption methods described in this prospectus, except
redemptions by mail. For more information, see "How the Funds Calculate Their
NAV."

9
<PAGE>

The Fund may, at its discretion, pay your redemption proceeds with
securities instead of cash. However, the Fund is obligated to redeem shares
solely in cash, up to the lesser of $250,000 or 1% of the Fund's total net
assets during any 90 day period for any one shareholder. See the SAI for
further details.

Except as otherwise noted, neither the Fund, the Service Company nor EDI
assumes responsibility for the authenticity of any instructions received by
any of them from a shareholder by telephone. The Service Company will employ
reasonable procedures to confirm that instructions received over the telephone
or otherwise are genuine. Neither the Fund, the Service Company nor EDI will
be liable when following instructions received by telephone or otherwise that
the Service Company reasonably believes to be genuine.

EXCHANGES

How to Exchange Shares. You may exchange some or all of your shares for
shares of the same class in other Evergreen funds through your financial
intermediary by calling or writing to the Service Company, or by using the
Evergreen Express Line as described above. Once an exchange request has been
telephoned or mailed, it is irrevocable and may not be modified or canceled.
Exchanges will be made on the basis of the relative NAVs of the shares
exchanged next determined after an exchange request is received. An exchange
which represents an initial investment in another Evergreen fund is subject to
the minimum investment and suitability requirements of that fund.

Each of the Evergreen funds has different investment objectives and
policies. For more information, a prospectus of the fund into which an
exchange will be made should be read prior to the exchange. An exchange order
must comply with the requirement for a redemption or repurchase order and must
specify the dollar value or number of shares to be exchanged. An exchange is
treated for federal income tax purposes as a redemption and purchase of shares
and may result in the realization of a capital gain or loss. Shareholders are
limited to five exchanges per calendar year, with a maximum of three per
calendar quarter. This exchange privilege may be modified or discontinued at
any time by the Fund upon 60 days' notice to shareholders and is only
available in states in which shares of a fund being acquired may lawfully be
sold.

No CDSC will be imposed in the event shares are exchanged for shares of
the same class of other Evergreen funds. If you redeem shares, the CDSC
applicable to the shares of the Evergreen fund originally purchased for cash
is applied. Also, Class B shares will continue to age following an exchange
for the purpose of conversion to Class A shares and for the purpose of
determining the amount of the applicable CDSC.

Exchanges Through Your Financial Intermediary. The Fund must receive exchange
instructions from your financial intermediary before 4:00 p.m. (eastern time)
for you to receive that day's NAV. Your financial intermediary is responsible
for furnishing all necessary documentation to a Fund and may charge you for
this service.

Exchanges By Telephone And Mail. Exchange requests received by the Fund after
4:00 p.m. (eastern time) will be processed using the NAV determined at the
close of the next business day. During periods of drastic economic or market
changes, shareholders may experience difficulty in effecting telephone
exchanges. You should follow the procedures outlined below for exchanges by
mail if you are unable to reach the Service Company by telephone. If you wish
to use the telephone exchange service you should indicate this on the
application. As noted above, the Fund will employ reasonable procedures to
confirm that instructions for the redemption or exchange of shares
communicated by telephone are genuine. A telephone exchange may be refused by
the Fund or the Service Company if it is believed advisable to do so.
Procedures for exchanging Fund shares by telephone may

10
<PAGE>

be modified or terminated at any time. Written requests for exchanges should
follow the same procedures outlined for written redemption requests in the
section entitled "How to Redeem Shares;" however, no signature guarantee is
required.

SHAREHOLDER SERVICES

The Fund offers the following shareholder services. For more information
about these services or your account, contact your financial intermediary, the
Service Company or call the toll-free number on the front page of this
prospectus. Some services are described in more detail in the application.

Systematic Investment Plan. Under a Systematic Investment Plan, you may invest
as little as $25 per month to purchase shares of the Fund with no minimum
initial investment required.

Telephone Investment Plan. You may make investments into an existing account
electronically in amounts of not less than $100 or more than $10,000 per
investment. Telephone investment requests received by 4:00 p.m. (eastern time)
will be credited to a shareholder's account the day the request is received.

Systematic Withdrawal Plan. When an account of $10,000 or more is opened or
when an existing account reaches that size, you may participate in a
Systematic Withdrawal Plan (the "Withdrawal Plan") by filling out the
appropriate part of the application. Under this Withdrawal Plan, you may
receive (or designate a third party to receive) a monthly or quarterly fixed-
withdrawal payment in a stated amount of at least $75, and as much as 1.0% per
month or 3.0% per quarter of the total NAV of fund shares in your account when
the Withdrawal Plan was opened. Fund shares will be redeemed as necessary to
meet withdrawal payments. All participants must elect to have their dividends
and capital gain distributions reinvested automatically. Any applicable CDSC
will be waived with respect to redemptions occurring under a Withdrawal Plan
during a calendar year to the extent that such redemptions do not exceed 12%
of (1) the initial value of the account plus (2) the value, at the time of
purchase, of any subsequent investments.

Investments Through Employee Benefit and Savings Plans. Certain qualified and
non-qualified employee benefit and savings plans may make shares of the Fund
and other Evergreen funds available to their participants. Investments made by
such employee benefit plans may be exempt from front-end sales charges if they
meet the criteria set forth under "Class A Shares -- Front End Sales Charge
Alternative." FUNB may provide compensation to organizations providing
administrative and recordkeeping services to plans which make shares of the
Evergreen funds available to their participants.

Automatic Reinvestment Plan. For the convenience of investors, all dividends
and distributions are automatically reinvested in full and fractional shares
of the Fund at the NAV per share at the close of business on the record date,
unless otherwise requested by a shareholder in writing. If the transfer agent
does not receive a written request for subsequent dividends and/or
distributions to be paid in cash at least three full business days prior to a
given record date, the dividends and/or distributions to be paid to a
shareholder will be reinvested.

Dollar Cost Averaging. Through dollar cost averaging you can invest a fixed
dollar amount each month or each quarter in any Evergreen fund. This results
in more shares being purchased when the selected fund's NAV is relatively low
and fewer shares being purchased when the fund's NAV is relatively high and
may result in a lower average cost per share than a less systematic investment
approach.

Prior to participating in dollar cost averaging, you must establish an
account in an Evergreen fund. You should designate on the application (1) the
dollar amount of each monthly or quarterly investment you wish to make and (2)
the fund in which the investment is to be made. Thereafter, on the first day
of the designated month, an amount equal to the specified monthly or quarterly
investment will automatically be redeemed from your initial account and
invested in shares of the designated fund.

Two Dimensional Investing. You may elect to have income and capital gains
distributions from any Evergreen fund shares you own automatically invested to
purchase the same class of shares of any other Evergreen fund. You may select
this service on your application and indicate the Evergreen fund(s) into which
distributions are to be invested.

11
<PAGE>

Tax Sheltered Retirement Plans. The Funds have various retirement plans
available to eligible investors, including Individual Retirement Accounts
(IRAs); Rollover IRAs; Simplified Employee Pension Plans (SEPs); Salary
Incentive Match Plan for Employees (SIMPLEs); Tax Sheltered Annuity Plans;
403(b)(7) Plans; 401(k) Plans; Keogh Plans; Profit-Sharing Plans; Medical
Savings Accounts; Pension and Target Benefit and Money Purchase Plans. For
details, including fees and application forms, call toll-free 1-800-247-4075
or write to the Service Company.

DIVIDENDS AND DISTRIBUTIONS

The Fund intends to distribute its investment company taxable income
monthly and net realized capital gains at least annually. Shareholders receive
Fund distributions in the form of additional shares of that class of shares
upon which the distribution is based or, at the shareholder's option, in cash.
Shareholders of the Fund who have not opted to receive cash prior to the
payable date for any dividend from net investment income or the record date
for any capital gains distribution will have the number of such shares
determined on the basis of the Fund's NAV per share computed at the end of
that day after adjustment for the distribution. NAV is used in computing the
number of shares in both capital gains and income distribution investments.

Because Class A shares bear most of the costs of distribution of such
shares through payment of a front-end sales charge, while Class B shares bear
such expenses through a higher annual distribution fee, expenses attributable
to Class B shares will generally be higher than those of Class A shares, and
income distributions paid by the Fund with respect to Class A shares will
generally be greater than those paid with respect to Class B shares.

Account statements and/or checks, as appropriate, will be mailed within
seven days after the Fund pays a distribution. Unless the Fund receives
instructions to the contrary before the record or payable date, as the case
may be, it will assume that a shareholder wishes to receive that distribution
and future capital gains and income distributions in shares. Instructions
continue in effect until changed in writing. If a shareholder has elected to
receive dividends and/or capital gain distributions in cash and the postal or
other delivery service selected by the Service Company is unable to deliver
checks to the shareholder's address of record, such shareholder's distribution
option will automatically be converted to having all dividend and other
distributions reinvested in additional shares. No interest will accrue on
amounts represented by uncashed distributions or redemption checks.

TAXES

The Fund has qualified and intends to continue to qualify as a regulated
investment company (a "RIC") under Subchapter M of the Internal Revenue Code
of 1986, as amended (the "Code"). As long as the Fund qualifies as a RIC and
distributes substantially all of its net investment income and capital gains,
it will not pay federal income taxes on the earnings it distributes to
shareholders.

Distributions to shareholders, whether taken in cash or reinvested in
shares, are generally considered taxable for federal income tax purposes as
follows:

. Income distributions and net short-term capital gains distributions
are taxable as ordinary income.

. Long-term capital gains distributions are taxable as capital gains,
regardless of how long you have held your shares.

12
<PAGE>

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FUND DETAILS

- -------------------------------------------------------------------------------

FUND ORGANIZATION AND SERVICE PROVIDERS

Fund Structure. The Fund is an investment pool, which invests shareholders'
money towards a specified goal. The Fund is a diversified series of an open-
end management investment company, called "Evergreen Select Equity Trust" (the
"Trust"). The Trust is a Delaware business trust organized on September 18,
1997.

Board of Trustees. The Trust is supervised by a Board of Trustees that is
responsible for representing the interests of shareholders. The Trustees meet
periodically throughout the year to oversee the Fund's activities, reviewing,
among other things, its performance and its contractual arrangements with
various service providers.

Shareholder Rights. All shareholders have equal voting, liquidation and other
rights. Each share is entitled to one vote for each dollar of NAV applicable
to such share. Shareholders may exchange shares as described under
"Exchanges," but will have no other preference, conversion, exchange or
preemptive rights. When issued and paid for, shares will be fully paid and
nonassessable. Shares of the Fund are redeemable, transferable and freely
assignable as collateral. The Trust may establish additional classes or series
of shares.

The Fund does not hold annual shareholder meetings; the Fund may,
however, hold special meetings for such purposes as electing or removing
Trustees, changing fundamental policies and approving investment advisory
agreements or 12b-1 plans. In addition, the Fund is prepared to assist
shareholders in communicating with one another for the purpose of convening a
meeting to elect Trustees.

Advisor. The investment advisor to the Fund is FUNB, a subsidiary of First
Union Corporation ("First Union"). First Union is located at 301 South College
Street, and FUNB at 201 South College Street, Charlotte, North Carolina 28288-
0630. First Union and its subsidiaries provide a broad range of financial
services to individuals and businesses throughout the U.S.

The Fund pays FUNB annually a fee of 0.40% of the Fund's average net
assets for its services. However, FUNB has voluntarily agreed to reduce its
advisory fee for the Fund, resulting in the net advisory fee of 0.12% of the
Fund's average net assets.

FUNB currently intends to continue indefinitely waiving a portion of the
Fund's advisory fee. FUNB may modify or cancel its expense waiver at any time.

Portfolio Manager. Leonard Capristo is the portfolio manager of the Fund. Mr.
Capristo has 26 years of investment experience and currently manages FUNB
Capital Management Group's Enhanced Stock Market Fund. He joined FUNB's
Capital Management Group in 1989 as the Director of Equity Trading. He
rejoined the Capital Management Group in 1997 from FUNB's Capital Markets
Group where he served as co-manager of public equity investments for three
years.

Distributor. EDI is the Fund's distributor. EDI is located at 125 West 55th
Street, New York, New York 10019 and is a subsidiary of The BISYS Group, Inc.
EDI markets the Fund and distributes its shares through broker-dealers,
financial planners and other financial representatives. EDI is not affiliated
with First Union.

Transfer Agent and Dividend Disbursing Agent. The Service Company is the
Fund's transfer agent. The Service Company is a subsidiary of First Union and
is located at 200 Berkeley Street, Boston, MA 02116-5034. The Service Company
handles shareholder services, including record keeping and account statements,
distribution of dividends and capital gains and processing of transactions.

Administrator. Evergreen Investment Services, Inc. ("EIS") serves as
administrator to the Fund. EIS is located at 200 Berkeley Street, Boston,
Massachusetts 02116-5034. As administrator, and subject to the supervision and
control of the Trust's Board of Trustees, EIS provides the Fund with
facilities, equipment and personnel. For its services as administrator, EIS is
entitled to receive a fee based on the aggregate average daily net assets of
the

13
<PAGE>

Fund at a rate based on the total assets of all mutual funds administered by
EIS for which any affiliate of FUNB serves as investment advisor. The
administration fee is calculated in accordance with the following schedule:

Custodian. State Street Bank and Trust Company ("State Street"), P.O. Box
9021, Boston, Massachusetts 02205-9827, acts as the Funds' custodian.

DISTRIBUTION PLANS AND AGREEMENTS

Distribution Plans. The Fund's Class A and Class B shares pay for the expenses
associated with the distribution of such shares according to a distribution
plan that it has adopted pursuant to Rule 12b-1 under the 1940 Act (each a
"Plan," or collectively, the "Plans"). Under the Plans, the Fund may incur
distribution-related and shareholder servicing-related expenses which are
based upon a maximum annual rate as a percentage of the Fund's average daily
net assets attributable to the class as follows:

Class A Shares 0.75% (currently limited to 0.25%)
Class B Shares 1.00%

Of the amount that each class may pay under its respective Plan, up to
0.25% may constitute a service fee to be used to compensate organizations,
which may include the Fund's investment advisor or its affiliates, for
personal services rendered to shareholders and/or the maintenance of
shareholder accounts. The Fund may not pay any distribution or service fees
during any fiscal period in excess of the amounts set forth above. Amounts
paid under the Plans are used to compensate the Fund's distributor pursuant to
the distribution agreements entered into by the Fund.

Distribution Agreements. The Fund has also entered into a distribution
agreement (each, a "Distribution Agreement" or collectively the "Distribution
Agreements") with EDI. Pursuant to the Distribution Agreements, the Fund will
compensate EDI for its services as distributor based upon the maximum annual
rate as a percentage of the Fund's average daily net assets attributable to
the class as follows:

Class A Shares 0.25%
Class B Shares 1.00%

The Distribution Agreements provide that EDI will use the distribution
fee received from a Fund for payments (i) to compensate broker-dealers or
other persons for distributing shares of a Fund, including interest and
principal payments made in respect of amounts paid to broker-dealers or other
persons that have been financed (EDI may assign its rights to receive
compensation under the Distribution Agreements to secure such financings),
(ii) to otherwise promote the sale of shares of a Fund, and (iii) to
compensate broker-dealers, depository institutions and other financial
intermediaries for providing administrative, accounting and other services
with respect to the Fund's shareholders. FUNB or its affiliates may finance
the payments made by EDI to compensate broker-dealers or other persons for
distributing shares of a Fund.

In the event the Fund acquires the assets of other mutual funds,
compensation paid to EDI under the Distribution Agreements may be paid by EDI
to the distributors of the acquired funds or their predecessors.

Since EDI's compensation under the Distribution Agreements is not
directly tied to the expenses incurred by EDI, the amount of compensation
received by EDI under the Distribution Agreements during any year may be more
or less than its actual expenses and may result in a profit to EDI.
Distribution expenses incurred by EDI in

14
<PAGE>

one fiscal year that exceed the level of compensation paid to EDI for that
year may be paid from distribution fees received from the Fund in subsequent
fiscal years.

OTHER INFORMATION AND POLICIES

Banking Laws. The Glass-Steagall Act and other banking laws and regulations
presently prohibit member banks of the Federal Reserve System ("Member Banks")
or their non-bank affiliates from sponsoring, organizing, controlling or
distributing the shares of registered open-end investment companies such as
the Fund. Such laws and regulations also prohibit banks from issuing,
underwriting or distributing securities in general. However, under the Glass-
Steagall Act and such other laws and regulations, a Member Bank or an
affiliate thereof may act as investment advisor, transfer agent or custodian
to a registered open-end investment company and may also act as agent in
connection with the purchase of shares of such an investment company upon the
order of its customer. FUNB and its affiliates are subject to and in
compliance with the aforementioned laws and regulations.

Changes to applicable laws and regulations or future judicial or
administrative decisions could result in FUNB and its affiliates being
prevented from continuing to perform the services required under the
investment advisory agreement or from acting as agent in connection with the
purchase of shares of the Fund by its customers. If FUNB and its affiliates
were prevented from continuing to provide the services called for under the
investment advisory agreement, it is expected that the Trustees would
identify, and call upon the Fund's shareholders to approve, a new investment
advisor. If this were to occur, it is not anticipated that the shareholders of
the Fund would suffer any adverse financial consequences.

Securities Transactions. Under policies established by the Trust's Board of
Trustees, the Fund's investment advisor selects broker-dealers to execute
portfolio transactions subject to the receipt of best execution. In so doing,
the Fund's investment advisor may select broker-dealers who are affiliated
with the advisor. Moreover, the Fund may pay higher commissions to broker-
dealers that provide research services, which the advisor may use in advising
the Fund or its other clients.

Portfolio Turnover. The estimated portfolio turnover rate for the Fund is not
expected to exceed 100%.

Code of Ethics. The Fund and its investment advisor have adopted a code of
ethics incorporating policies on personal securities trading. In general,
these codes of ethics require that certain personnel of the Fund and its
investment advisor (1) abstain from engaging in certain personal trading
practices and (2) report certain personal trading activities.

Other Classes of Shares. The Fund offers four classes of shares, Class A,
Class B, Institutional and Institutional Service. Only Class A and Class B
shares are offered through this prospectus. Call the Service Company at 1-800-
343-2898 for information on the other classes of shares, including how to get
a prospectus.

Year 2000 Risks. Like other investment companies, financial and business
organizations and individuals around the world, the Fund could be adversely
affected if the computer systems used by the Fund's investment advisor and the
Fund's other service providers do not properly process and calculate date-
related information and data from and after January 1, 2000. This is commonly
known as the "Year 2000 Problem." The Fund's investment advisor is taking
steps to address the Year 2000 Problem with respect to the computer systems
that it uses and to obtain assurances that comparable steps are being taken by
the Fund's other major service providers. At this time, however, there can be
no assurance that these steps will be sufficient to avoid any adverse impact
on the Fund.

FUND PERFORMANCE

Total Return. Total return is the change in value of an investment in the Fund
over a given period, assuming that dividends and capital gains are reinvested
and that recurring charges are deducted. A cumulative total return reflects
actual performance over a stated period of time. An average annual total
return is a hypothetical rate of return that, if achieved annually, would have
produced the same cumulative total return if performance had been constant
over the entire period. Average annual total returns smooth out variations in
performance; they are not the same as actual year-by-year results.

15
<PAGE>

Yield. Yield is the income generated by an investment in the Fund over a given
period of time, expressed as an annual percentage rate. Yields are calculated
according to a standard that is required for all stock and bond funds. Because
this differs from other accounting methods, the quoted yield may not equal the
income actually paid to shareholders.

General. The Fund may include comparative performance information in
advertising or in marketing its shares. Such information could include data
from Lipper Analytical Services, Inc., Morningstar, Inc., CDA Weisenberger and
Value Line, or other industry publications or various indexes such as the S&P
500 Index.

For more information on the Fund's performance, see the SAI.

Related Performance Information. The following total return information is
provided with reference to Equity Index Fund, a portfolio of CoreFunds, Inc.,
a registered investment company managed by CoreStates Investment Advisors,
Inc. The Class A and Class B shares of Equity Index Fund were reorganized into
the Institutional Service Shares of Evergreen Select Equity Index Fund in July
1998. Equity Index Fund had an investment objective, policies and strategies
materially equivalent to those of Evergreen Select Equity Index Fund. Past
performance of the Equity Index Fund is no guarantee of the future performance
of Evergreen Select Equity Index Fund. The Equity Index Fund did not pay a
12b-1 fee and if it had, the performance would be lower. The performance
information set forth below is provided as of June 30, 1998.

<TABLE>
<CAPTION>
PERIOD CLASS A CLASS B
------ ------- -------
<S> <C> <C>
One Year 29.17% N/A
Since inception 34.23% 22.75%
Inception date 10/9/96 11/7/97
</TABLE>

16
<PAGE>

INVESTMENT ADVISOR
First Union National Bank, 201 South College Street, Charlotte, North Carolina
28288-0630

CUSTODIAN
State Street Bank and Trust Company, P.O. Box 9021, Boston, Massachusetts
02205-9827

TRANSFER AGENT
Evergreen Service Company, 200 Berkeley Street, Boston, Massachusetts 02116-
5034

LEGAL COUNSEL
Sullivan & Worcester LLP, 1025 Connecticut Avenue, N.W., Washington, D.C. 20036

INDEPENDENT AUDITORS
KPMG Peat Marwick LLP, 99 High Street, Boston, Massachusetts 02110

DISTRIBUTOR
Evergreen Distributor, Inc., 125 West 55th Street, New York, New York 10019

38197 541909Rv1

EVERGREEN SELECT EQUITY TRUST

PART B

STATEMENT OF ADDITIONAL INFORMATION

<PAGE>

EVERGREEN SELECT EQUITY TRUST
200 Berkeley Street
Boston, Massachusetts 02116
(800) 633-2700

STATEMENT OF ADDITIONAL INFORMATION

November 1, 1998

Evergreen Select Strategic Value Fund
Evergreen Select Diversified Value Fund
Evergreen Select Large Cap Blend Fund
Evergreen Select Common Stock Fund
Evergreen Select Strategic Growth Fund
Evergreen Select Equity Income Fund
Evergreen Select Small Company Value Fund
Evergreen Select Social Principles Fund
Evergreen Select Balanced Fund
Evergreen Select Equity Index Fund
Evergreen Select Special Equity Fund
Evergreen Select Small Cap Growth Fund
(Each a "Fund" Together the "Funds")

Each Fund is a series of an open-end management investment company, known
as Evergreen Select Equity Trust (the "Trust").

Each Fund offers at least two classes of shares: Institutional Shares
and Institutional Service Shares. In addition, Evergreen Select Large Cap Blend
Fund and Evergreen Select Social Principles Fund offer Charitable Shares, and
Evergreen Select Equity Index Fund offers Class A and Class B shares. This
statement of additional information ("SAI") provides additional information
about the applicable classes of shares for the Funds listed above. It is not a
prospectus but should be read in conjunction with Fund prospectuses dated
November 1, 1998, as supplemented from time to time. You may obtain prospectuses
from Evergreen Distributor, Inc.

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TABLE OF CONTENTS

INVESTMENT POLICIES..........................................................3
Fundamental Investment Policies.....................................3
Additional Information on Securities and Investment Practices.......5
MANAGEMENT OF THE TRUST.....................................................17
PRINCIPAL HOLDERS OF FUND SHARES............................................21
INVESTMENT ADVISORY AND OTHER SERVICES......................................27
Investment Advisors....................................................27
Distributor............................................................29
Distribution Plan......................................................29
Additional Service Providers...........................................31
BROKERAGE...................................................................31
Selection of Brokers...................................................31
Brokerage Commissions..................................................32
General Brokerage Policies.............................................32
TRUST ORGANIZATION..........................................................33
Form of Organization...................................................33
Description of Shares..................................................33
Voting Rights..........................................................33
Limitation of Trustees' Liability......................................34
PURCHASE, REDEMPTION AND PRICING OF FUND SHARES.............................34
How the Fund Offers Its Shares to the Public (Equity Index
Class A and B).......................................................34
Contingent Deferred Sales Charge (Equity Index Class A and B)..........35
Sales Charge Waivers or Reductions (Equity Index Class A and B)........35
Exchanges..............................................................37
How and When the Funds Calculate Their Net Asset Value Per Share.......37
How The Funds Value The Securities They Own............................37
Shareholder Services...................................................38
PRINCIPAL UNDERWRITER.......................................................38
ADDITIONAL TAX INFORMATION..................................................39
Requirement for Qualification as a Regulated Investment Company........39
Taxes on Distributions.................................................39
Taxes on the Sale or Exchange of Fund Shares...........................40
Other Tax Considerations...............................................41
FINANCIAL INFORMATION.......................................................41
Expenses...............................................................41
Brokerage Commissions Paid.............................................43
Performance Data.......................................................44
ADDITIONAL INFORMATION......................................................47

24723

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INVESTMENT POLICIES

FUNDAMENTAL INVESTMENT POLICIES

Each Fund has adopted the fundamental investment restrictions set forth
below which may not be changed without the vote of a majority of the Fund's
outstanding shares, as defined in the Investment Company Act of 1940, as amended
(the "1940 Act"). Where necessary, an explanation beneath a fundamental policy
describes a Fund's practices with respect to that policy, as allowed by current
law. If the law governing a policy changes, the Fund's practices may change
accordingly without a shareholder vote. Unless otherwise stated, all references
to the assets of the Fund are in terms of current market value.

1. Diversification

Each Fund may not make any investment that is inconsistent with its
classification as a diversified investment company under the 1940 Act.

Further Explanation of Diversification Policy

To remain classified as a diversified investment company under the 1940
Act, each Fund must conform with the following: With respect to 75% of its total
assets, a diversified investment company may not invest more than 5% of its
total assets, determined at market or other fair value at the time of purchase,
in the securities of any one issuer, or invest in more than 10% of the
outstanding voting securities of any one issuer, determined at the time of
purchase. These limitations do not apply to investments in securities issued or
guaranteed by the United States ("U.S.") government or its agencies or
instrumentalities.

2. Concentration

Each Fund may not concentrate its investments in the securities of issuers
primarily engaged in any particular industry (other than securities that are
issued or guaranteed by the U.S. government or its agencies or
instrumentalities).

Further Explanation of Concentration Policy

Each Fund may not invest more than 25% of its total assets, taken at market
value, in the securities of issuers primarily engaged in any particular industry
(other than securities issued or guaranteed by the U.S. government or its
agencies or instrumentalities).

3. Issuing Senior Securities

Except as permitted under the 1940 Act, each Fund may not issue senior
securities.

4. Borrowing

Each Fund may not borrow money, except to the extent permitted by
applicable law.

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<PAGE>

Further Explanation of Borrowing Policy

Each Fund may borrow from banks or enter into reverse repurchase agreements
in an amount up to 33 1/3% of its total assets, taken at market value. Each Fund
may also borrow up to an additional 5% of its total assets from banks or others.
Each Fund may borrow only as a temporary measure for extraordinary or emergency
purposes such as the redemption of Fund shares. Each Fund may not purchase
securities while outstanding borrowings exceed 5% of its total assets. Each Fund
may obtain such short-term credit as may be necessary for the clearance of
purchases and sales of portfolio securities. Each Fund may purchase securities
on margin and engage in short sales to the extent permitted by applicable law.

5. Underwriting

Each Fund may not underwrite securities of other issuers, except insofar as
each Fund may be deemed to be an underwriter in connection with the disposition
of its portfolio securities.

6. Real Estate

Each Fund may not purchase or sell real estate, except that, to the extent
permitted by applicable law, each Fund may invest in (a) securities that are
directly or indirectly secured by real estate, or (b) securities issued by
issuers that invest in real estate.

7. Commodities

Each Fund may not purchase or sell commodities or contracts on commodities,
except to the extent that each Fund may engage in financial futures contracts
and related options and currency contracts and related options and may otherwise
do so in accordance with applicable law and without registering as a commodity
pool operator under the Commodity Exchange Act.

8. Lending

Each Fund may not make loans to other persons, except that each Fund may
lend its portfolio securities in accordance with applicable law. The acquisition
of investment securities or other investment instruments shall not be deemed to
be the making of a loan.

Further Explanation of Lending Policy

To generate income and offset expenses, each Fund may lend portfolio
securities to broker-dealers and other financial institutions in an amount up to
33 1/3% of its total assets, taken at market value. While securities are on
loan, the borrower will pay a Fund any income accruing on the security. Each
Fund may invest any collateral it receives in additional portfolio securities,
such as U.S. Treasury notes, certificates of deposit, other high-grade,
short-term obligations or interest bearing cash equivalents. Gains or losses in
the market value of a security lent will affect a Fund and its shareholders.

When a Fund lends its securities, it will require the borrower to give the
Fund collateral in cash or government securities. The Fund will require
collateral in an amount equal to at least 100% of the current market value of
the securities lent, including accrued interest. A Fund has the right to call a
loan and obtain the securities lent at any time on notice of not more than five
business days.
A Fund may pay reasonable fees in connection with such loans.

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ADDITIONAL INFORMATION ON SECURITIES AND INVESTMENT PRACTICES

The investment objectives of each Fund and a description of the securities
in which each Fund may invest is set forth in the Funds' prospectuses. The
following expands upon the discussion in the prospectuses regarding certain
investments of the Funds.

Equity Securities

Equity securities consist primarily of common stocks and securities
convertible into common stocks. Investing in common stocks, particularly those
having growth characteristics, frequently involves greater risks (and possibly
greater rewards) than investing in other types of securities. Common stock
prices tend to be more volatile and companies having growth characteristics may
sometimes be unproven.

Investing in companies with small or medium market capitalizations involves
greater risk than investing in larger companies. The stock prices of small and
mid-cap companies can rise quickly and drop substantially in a short period of
time. This volatility results from a number of factors, including reliance by
these companies on relatively limited product lines, markets, and financial and
management resources. These and other factors may make small and mid-cap
companies more susceptible to setbacks or downturns. These companies may
experience higher rates of bankruptcy or other failures than larger companies.
They may be more likely to be negatively affected by changes in management. In
addition, the stock of small and mid-cap companies may be thinly traded.

Derivatives

Derivatives are financial contracts whose value depends on, or is derived
from, the value of an underlying asset, reference rate or index. These assets,
rates, and indices may include bonds, stocks, mortgages, commodities, interest
rates, currency exchange rates, bond indices, and stock indices. Derivatives may
be standardized, exchange-traded contracts or customized, privately negotiated
contracts. Exchange-traded derivatives tend to be more liquid and subject to
less credit risk than those that are privately negotiated.

There are four principal types of derivative instruments -- options,
futures, forwards, and swaps -- from which virtually any type of derivative
transaction can be created. Debt instruments that incorporate one or more of
these building blocks for the purpose of determining the principal amount of
and/or rate of interest payable on the debt instruments are often referred to as
"structured securities." An example of this type of structured security is
indexed commercial paper. The term is also used to describe certain securities
issued in connection with the restructuring of certain foreign obligations. The
term "derivative" is also sometimes used to describe securities involving rights
to a portion of the cash flows from an underlying pool of mortgages or other
assets from which payments are passed through to the owner of, or that
collateralize, the securities.

The Funds can use derivatives to earn income, to enhance returns, to hedge
or adjust the risk profile of the portfolio, in place of more traditional direct
investments or to obtain exposure to otherwise inaccessible markets. A Fund's
use derivatives for non-hedging purposes entails greater risks than if a Fund
were to use derivatives solely for hedging purposes.

Derivatives are a valuable tool which, when used properly, can provide
significant benefit to a Fund's shareholders. Each Fund's investment advisor is
not an aggressive user of derivatives with

24688
5

<PAGE>

respect to the Funds. However, a Fund may take positions in those derivatives
that are within its investment policies if, in the judgment of the Advisor (as
hereinafter defined), this represents an effective response to current or
anticipated market conditions. The Advisor's use of derivatives is subject to
continuous risk assessment and control from the standpoint of a Fund's
investment objective and policies. While the judicious use of derivatives by
experienced investment managers, such as the Advisor, can be beneficial,
derivatives also involve risks different from, and, in certain cases, greater
than, the risks presented by more traditional investments. Following is a
general discussion of important risk factors and issues concerning the use of
derivatives that investors should understand before investing in a Fund.

Market Risk -- This is the general risk attendant to all investments that
the value of a particular investment will decline or otherwise change in a way
detrimental to a Fund's interest.

Management Risk -- Derivative products are highly specialized instruments
that require investment techniques and risk analyses different from those
associated with stocks and bonds. The use of a derivative requires an
understanding not only of the underlying instrument, but also of the derivative
itself, without the benefit of observing the performance of the derivative under
all possible market conditions. Because derivatives are complex, each Fund and
its Advisor must (1) maintain controls to monitor the transactions entered into,
(2) assess the risk that a derivative adds to a Fund's portfolio and (3)
forecast price, interest rate or currency exchange rate movements correctly.

Credit Risk -- This is the risk that a Fund may lose money because the
other party to a derivative (usually called a "counter party") failed to comply
with the terms of the derivative contract. The credit risk for exchange-traded
derivatives is generally less than for privately negotiated derivatives, since
the clearing house, which is the issuer or counter party to each exchange-traded
derivative, guarantees performance. This guarantee is supported by a daily
payment system (i.e., margin requirements) operated by the clearing house to
reduce overall credit risk. For privately negotiated derivatives, there is no
similar clearing agency guarantee. Therefore, a Fund considers the
creditworthiness of each counter party to a privately negotiated derivative in
evaluating potential credit risk.

Liquidity Risk -- Liquidity risk is the possibility that a Fund will have
difficult buying or selling a particular instrument. If a derivative transaction
is particularly large or if the relevant market is illiquid (as is the case with
many privately negotiated derivatives), a Fund may not be able to initiate a
transaction or liquidate a position at an advantageous price.

Leverage Risk -- Since many derivatives have a leverage component, adverse
changes in the value or level of the underlying asset, rate or index can result
in a loss substantially greater than the amount invested in the derivative
itself. In the case of swaps, the risk of loss generally is related to a
notional principal amount, even if the parties have not made any initial
investment. Certain derivatives have the potential for unlimited loss,
regardless of the size of the initial investment.

Other Risks -- Other risks in using derivatives include the risk of
mispricing or improper valuation and the inability of derivatives to correlate
perfectly with underlying assets, rates, and indices. Many derivatives, in
particular privately negotiated derivatives, are complex and often valued
subjectively. Improper valuations can result in increased cash payment
requirements to counter parties or a loss of value to a Fund. Derivatives do not
always perfectly or even highly correlate or track the value of the assets,
rates or indices they are designed to closely track. Consequently, a Fund's use
of derivatives may not always be an effective means of, and sometimes could be
counterproductive to, furthering a Fund's investment objective.

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<PAGE>

Options Transactions

Writing Covered Options. The Funds may write (i.e., sell) covered call and
put options. By writing a call option, a Fund becomes obligated during the term
of the option to deliver the securities underlying the option upon payment of
the exercise price. Writing a put option obligates the Fund during the term of
the option to purchase the securities underlying the option at the exercise
price if the option buyer exercises the option. A Fund also may write straddles
(combinations of covered puts and calls on the same underlying security).

The Funds may only write "covered" options. This means that while a Fund is
obligated as the writer of a call option it will own the underlying securities
subject to the option or, with call options on U.S. Treasury bills, it might own
similar U.S. Treasury bills. If a Fund has written options against all of its
securities that are available for writing options, the Fund may be unable to
write additional options unless it sells some of its portfolio holdings to
obtain new securities against which it can write options. If this were to occur,
higher portfolio turnover and correspondingly greater brokerage commissions and
other transaction costs may result. The Funds do not expect, however, that this
will occur. A Fund will be considered "covered" with respect to a put option it
writes if, while it is obligated as the writer of the put option, it deposits
and maintains with its custodian in a segregated account liquid assets having a
value equal to or greater than the exercise price of the option.

The principal reason for writing call or put options is to obtain, through
a receipt of premiums, a greater current return than would be realized on the
underlying securities alone. A Fund receives a premium from writing a call or
put option, which it retains whether or not the option is exercised. By writing
a call option, a Fund might lose the potential for gain on the underlying
security while the option is open, and, by writing a put option, a Fund might
become obligated to purchase the underlying security for more than its current
market price upon exercise.

Purchasing Options. The Funds may purchase put or call options, including
put or call options for offsetting previously written put or call options of the
same series. Once a Fund has written a covered option, it will continue to hold
the segregated securities or assets until it effects a closing purchase
transaction. If the Fund is unable to close the option position, it must hold
the segregated securities or assets until the option expires or is exercised. An
option position may be closed out only in a secondary market for an option of
the same series. Although a Fund generally writes only those options for which
there appears to be an active secondary market, there is no assurance that a
liquid secondary market will exist for any particular option at any particular
time, and, for some options, no secondary market may exist. In such event,
effecting a closing transaction for a particular option might not be possible.

Options on some securities are relatively new, and predicting how much
trading interest there will be for such options is impossible. There can be no
assurance that viable markets will develop or continue. The failure of such
markets to develop or continue could significantly impair a Fund's ability to
use such options to achieve its investment objective.

Options Trading Markets. The Funds trade in options that are generally
listed on national securities exchanges, currently including the Chicago Board
Options Exchange and the New York, American, Pacific and Philadelphia Stock
Exchanges. Options on some securities are traded in the over-the-counter market,
and may not be listed on any exchange. Options traded in the over-the-counter
market involve a greater risk that the securities dealers participating in the
transactions could fail to meet their obligations to a Fund.

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<PAGE>

A Fund will include the premiums it has paid for the purchase of unlisted
options and the value of securities used to cover options it has written for
purposes of calculating whether the Fund has complied with its policies on
illiquid securities.

Futures Transactions and Related Options Transactions

The Funds intend to enter into financial futures contracts as a hedge
against changes in prevailing levels of interest rates to seek relative
stability of principal and to establish more definitely the effective return on
securities held or intended to be acquired by the Funds or as a hedge against
changes in the prices of securities held by a Fund or to be acquired by a Fund.
A Fund's hedging may include sales of futures as an offset against the effect of
expected increases in interest rates or securities prices and purchases of
futures as an offset against the effect of expected declines in interest rates.

For example, when a Fund anticipates a significant market or market sector
advance, it will purchase a stock index futures contract as a hedge against not
participating in such advance at a time when a Fund is not fully invested. The
purchase of a futures contract serves as a temporary substitute for the purchase
of individual securities which may then be purchased in an orderly fashion. As
such purchases are made, an equivalent amount of index based futures contracts
would be terminated by offsetting sales. In contrast, a Fund would sell stock
index futures contracts in anticipation of or in a general market or market
sector decline that may adversely affect the market value of the Fund's
portfolio. To the extent that the Fund's portfolio changes in value in
correlation with a given index, the sale of futures contracts on that index
would substantially reduce the risk to the portfolio of a market decline or
change in interest rates, and, by doing so, provide an alternative to the
liquidation of the Fund's securities positions and the resulting transaction
costs.

The Funds intend to engage in options transactions which are related to
financial futures contracts for hedging purposes and in connection with the
hedging strategies described above.

Although techniques other than sales and purchases of futures contracts and
related options transactions could be used to reduce the Funds' exposure to
interest rate and/or market fluctuations, the Funds may be able to hedge their
exposure more effectively and perhaps at a lower cost through using futures
contracts and related options transactions. While the Funds do not intend to
take delivery of the instruments underlying futures contracts they hold, the
Funds do not intend to engage in such futures contracts for speculation.

Futures Contracts

Futures contracts are transactions in the commodities markets rather than
in the securities markets. A futures contract creates an obligation by the
seller to deliver to the buyer the commodity specified in the contract at a
specified future time for a specified price. The futures contract creates an
obligation by the buyer to accept delivery from the seller of the commodity
specified at the specified future time for the specified price. In contrast, a
spot transaction creates an immediate obligation for the seller to deliver and
the buyer to accept delivery of and pay for an identified commodity. In general,
futures contracts involve transactions in fungible goods such as wheat, coffee
and soybeans. However, in the last decade an increasing number of futures
contracts have been developed which specify financial instruments or financially
based indexes as the underlying commodity.

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U.S. futures contracts are traded only on national futures exchanges and are
standardized as to maturity date and underlying financial instrument. The
principal financial futures exchanges in the United States are The Board of
Trade of the City of Chicago, the Chicago Mercantile Exchange, the International
Monetary Market (a division of the Chicago Mercantile Exchange), the New York
Futures Exchange and the Kansas City Board of Trade. Each exchange guarantees
performance under contract provisions through a clearing corporation, a
nonprofit organization managed by the exchange membership, which is also
responsible for handling daily accounting of deposits or withdrawals of margin.
A futures commission merchant ("Broker") effects each transaction in connection
with futures contracts for a commission. Futures exchanges and trading are
regulated under the Commodity Exchange Act by the Commodity Futures Trading
Commission ("CFTC") and National Futures Association ("NFA").

Interest Rate Futures Contracts. The sale of an interest rate futures
contract creates an obligation by a Fund, as seller, to deliver the type of
financial instrument specified in the contract at a specified future time for a
specified price. The purchase of an interest rate futures contract creates an
obligation by a Fund, as purchaser, to accept delivery of the type of financial
instrument specified at a specified future time for a specified price. The
specific securities delivered or accepted, respectively, at settlement date, are
not determined until at or near that date. The determination is in accordance
with the rules of the exchange on which the futures contract sale or purchase
was made.

Currently, interest rate futures contracts can be purchased or sold on
90-day U.S. Treasury bills, U.S. Treasury bonds, U.S. Treasury notes with
maturities between 6 1/2 and 10 years, Government National Mortgage Association
(GNMA) certificates, 90-day domestic bank certificates of deposit, 90-day
commercial paper, and 90-day Eurodollar certificates of deposit. It is expected
that futures contracts trading in additional financial instruments will be
authorized. The standard contract size is $100,000 for futures contracts in U.S.
Treasury bonds, U.S. Treasury notes and GNMA certificates, and $1,000,000 for
the other designated contracts. While U.S. Treasury bonds, U.S. Treasury bills,
U.S. Treasury notes and GNMA certificates are backed by the full faith and
credit of the U.S. government, the futures contracts in U.S. government
securities are not obligations of the U.S. Treasury.

Index Based Futures Contracts, Other Than Stock Index Based. It is expected
that bond index and other financially based index futures contracts will be
developed in the future. It is anticipated that such index based futures
contracts will be structured in the same way as stock index futures contracts
but will be measured by changes in interest rates, related indexes or other
measures, such as the consumer price index. In the event that such futures
contracts are developed, the Funds will sell interest rate index and other index
based futures contracts to hedge against changes which are expected to affect
the Funds' portfolios.

The purchase or sale of a futures contract differs from the purchase or
sale of a security, in that no price or premium is paid or received. Instead, to
initiate trading an amount of cash, cash equivalents, money market instruments,
or U.S. Treasury bills equal to approximately 1 1/2% (up to 5%) of the contract
amount must be deposited by a Fund with the Broker. This amount is known as
initial margin. The nature of initial margin in futures transactions is
different from that of margin in security transactions. Futures contract margin
does not involve the borrowing of funds by the customer to finance the
transactions. Rather, the initial margin is in the nature of a performance bond
or good faith deposit on the contract which is returned to a Fund upon
termination of the futures contract assuming all contractual obligations have
been satisfied. The margin required for a particular futures contract is set by
the exchange on which the contract is traded and may be significantly modified
from time to time by the exchange during the term of the contract.

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Subsequent payments, called variation margin, to the Broker and from the
Broker, are made on a daily basis as the value of the underlying instrument or
index fluctuates making the long and short positions in the futures contract
more or less valuable, a process known as mark-to-market. For example, when a
Fund has purchased a futures contract and the price of the underlying financial
instrument or index has risen, that position will have increased in value, and
the Fund will receive from the Broker a variation margin payment equal to that
increase in value. Conversely, where a Fund has purchased a futures contract and
the price of the underlying financial instrument or index has declined, the
position would be less valuable and the Fund would be required to make a
variation margin payment to the Broker. At any time prior to expiration of the
futures contract, a Fund may elect to close the position. A final determination
of variation margin is then made, additional cash is required to be paid to or
released by the Broker, and the Fund realizes a loss or gain.

The Trust intends to enter into arrangements with its custodian and with
Brokers to enable the initial margin of a Fund and any variation margin to be
held in a segregated account by its custodian on behalf of the Broker.

Although interest rate futures contracts by their terms call for actual
delivery or acceptance of financial instruments, and index based futures
contracts call for the delivery of cash equal to the difference between the
closing value of the index on the expiration date of the contract and the price
at which the futures contract is originally made, in most cases such futures
contracts are closed out before the settlement date without the making or taking
of delivery. Closing out a futures contract sale is effected by an offsetting
transaction in which a Fund enters into a futures contract purchase for the same
aggregate amount of the specific type of financial instrument or index and same
delivery date. If the price in the sale exceeds the price in the offsetting
purchase, the Fund is paid the difference and thus realizes a gain. If the
offsetting purchase price exceeds the sale price, the Fund pays the difference
and realizes a loss. Similarly, the closing out of a futures contract purchase
is effected by an offsetting transaction in which a Fund enters into a futures
contract sale. If the offsetting sale price exceeds the purchase price, the Fund
realizes a gain. If the purchase price exceeds the offsetting sale price the
Fund realizes a loss. The amount of the Fund's gain or loss on any transaction
is reduced or increased, respectively, by the amount of any transaction costs
incurred by the Fund.

As an example of an offsetting transaction, the contractual obligations
arising from the sale of one contract of September U.S. Treasury bills on an
exchange may be fulfilled at any time before delivery of the contract is
required (i.e. on a specified date in September, the "delivery month") by the
purchase of one contract of September U.S. Treasury bills on the same exchange.
In such instance the difference between the price at which the futures contract
was sold and the price paid for the offsetting purchase, after allowance for
transaction costs, represents the profit or loss to a Fund.

There can be no assurance, however, that a Fund will be able to enter into
an offsetting transaction with respect to a particular contract at a particular
time. If a Fund is not able to enter into an offsetting transaction, the Fund
will continue to be required to maintain the margin deposits on the contract and
to complete the contract according to its terms.

Options on Financial Futures. The Funds intend to purchase call and put
options on financial futures contracts and sell such options to terminate an
existing position. Options on futures are similar to options on stocks except
that an option on a futures contract gives the purchaser the right, in return
for the premium paid, to assume a position in a futures contract (a long
position if the option is a call and a short position if the option is a put)
rather than to purchase or sell stock at a specified exercise price at any time
during the period of the option. Upon exercise of the

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option, the delivery of the futures position by the writer of the option to the
holder of the option will be accompanied by delivery of the accumulated balance
in the writer's futures margin account. This amount represents the amount by
which the market price of the futures contract at exercise exceeds, in the case
of a call, or is less than, in the case of a put, the exercise price of the
option on the futures contract. If an option is exercised the last trading day
prior to the expiration date of the option, the settlement will be made entirely
in cash equal to the difference between the exercise price of the option and
value of the futures contract.

The Funds intend to use options on financial futures contracts in
connection with hedging strategies. In the future the Funds may use such options
for other purposes.

Purchase of Put Options on Futures Contracts. The purchase of protective
put options on financial futures contracts is analogous to the purchase of
protective puts on individual stocks, where an absolute level of protection is
sought below which no additional economic loss would be incurred by a Fund. Put
options may be purchased to hedge a portfolio of stocks or debt instruments or a
position in the futures contract upon which the put option is based.

Purchase of Call Options on Futures Contracts. The purchase of call options
on financial futures contracts represents a means of obtaining temporary
exposure to market appreciation at limited risk. It is analogous to the purchase
of a call option on an individual stock, which can be used as a substitute for a
position in the stock itself. Depending on the pricing of the option compared to
either the futures contract upon which it is based, or upon the price of the
underlying financial instrument or index itself, purchase of a call option may
be less risky than the ownership of the interest rate or index based futures
contract or the underlying securities. Call options on commodity futures
contracts may be purchased to hedge against an interest rate increase or a
market advance when a Fund is not fully invested.

Use of New Investment Techniques Involving Financial Futures Contracts or
Related Options. The Funds may employ new investment techniques involving
financial futures contracts and related options. The Funds intend to take
advantage of new techniques in these areas which may be developed from time to
time and which are consistent with the Fund's investment objective. The Trust
believes that no additional techniques have been identified for employment by
the Funds in the foreseeable future other than those described above.

The Funds intend that its futures contracts and related options
transactions will be entered into for traditional hedging purposes. That is,
futures contracts will be sold to protect against a decline in the price of
securities that a Fund owns, or futures contracts will be purchased to protect a
Fund against an increase in the price of securities it intends to purchase. The
Funds do not intend to enter into futures contracts for speculation.

In instances involving the purchase of futures contracts by a Fund, an
amount of cash and cash equivalents, equal to the market value of the futures
contracts will be deposited in a segregated account and/or in a margin account
with a Broker to collateralize the position and thereby insure that the use of
such futures is unleveraged.

Risks of Futures Contracts. Financial futures contracts prices are volatile
and are influenced, among other things, by changes in stock prices, market
conditions, prevailing interest rates and anticipation of future stock prices,
market movements or interest rate changes, all of which in turn are affected by
economic conditions, such as government fiscal and monetary policies and
actions, and national and international political and economic events.

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At best, the correlation between changes in prices of futures contracts and
of the securities being hedged can be only approximate. The degree of
imperfection of correlation depends upon circumstances, such as variations in
speculative market demand for futures contracts and for securities, including
technical influences in futures contracts trading; differences between the
securities being hedged and the financial instruments and indexes underlying the
standard futures contracts available for trading, in such respects as interest
rate levels, maturities and creditworthiness of issuers, or identities of
securities comprising the index and those in a Fund's portfolio. In addition,
futures contract transactions involve the remote risk that a party be unable to
fulfill its obligations and that the amount of the obligation will be beyond the
ability of the clearing broker to satisfy. A decision of whether, when and how
to hedge involves the exercise of skill and judgment, and even a well conceived
hedge may be unsuccessful to some degree because of market behavior or
unexpected interest rate trends.

Because of the low margin deposits required, futures trading involves an
extremely high degree of leverage. As a result, a relatively small price
movement in a futures contract may result in immediate and substantial loss, as
well as gain, to the investor. For example, if at the time of purchase, 10% of
the value of the futures contract is deposited as margin, a 10% decrease in the
value of the futures contract would result in a total loss of the margin
deposit, before any deduction for the transaction costs, if the account were
then closed out, and a 15% decrease would result in a loss equal to 150% of the
original margin deposit. Thus, a purchase or sale of a futures contract may
result in losses in excess of the amount invested in the futures contract.
However, a Fund would presumably have sustained comparable losses if, instead of
entering into the futures contract, it had invested in the underlying financial
instrument. Furthermore, in order to be certain that a Fund has sufficient
assets to satisfy its obligations under a futures contract, the Fund will
establish a segregated account in connection with its futures contracts which
will hold cash or cash equivalents equal in value to the current value of the
underlying instruments or indices less the margins on deposit.

Most U.S. futures exchanges limit the amount of fluctuation permitted in
futures contract prices during a single trading day. The daily limit establishes
the maximum amount that the price of a futures contract may vary either up or
down from the previous day's settlement price at the end of a trading session.
Once the daily limit has been reached in a particular type of contract, no
trades may be made on that day at a price beyond that limit. The daily limit
governs only price movement during a particular trading day and therefore does
not limit potential losses because the limit may prevent the liquidation of
unfavorable positions. Futures contract prices have occasionally moved to the
daily limit for several consecutive trading days with little or no trading,
thereby preventing prompt liquidation of futures positions and subjecting some
futures traders to substantial losses.

Risks of Options on Futures Contracts. In addition to the risks described
above for financial futures contracts, there are several special risks relating
to options on futures contracts. The ability to establish and close out
positions on such options will be subject to the development and maintenance of
a liquid secondary market. There is no assurance that a liquid secondary market
will exist for any particular contract or at any particular time. A Fund will
not purchase options on any futures contract unless and until it believes that
the market for such options has developed sufficiently that the risks in
connection with such options are not greater than the risks in connection with
the futures contracts. Compared to the use of futures contracts, the purchase of
options on such futures involves less potential risk to a Fund because the
maximum amount at risk is the premium paid for the options (plus transaction
costs). However, there may be circumstances when the use of an option on a
futures contract would result in a loss to a Fund, even though the use of a
futures contract would not, such as when there is no movement in the level of
the futures contract.

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Corporate Bond Ratings (Evergreen Select Balanced Fund)

Higher yields are usually available on securities that are lower rated or
that are unrated. Bonds rated Baa by Moody's Investors Service, Inc. ("Moody's")
are considered as medium grade obligations, which are neither highly protected
nor poorly secured. Debt rated BBB by Standard & Poor's Rating Services ("S&P")
is regarded as having an adequate capacity to pay interest and repay principal,
although adverse economic conditions are more likely to lead to a weakened
capacity to pay interest and repay principal for debt in this category than in
higher rated categories. Lower rated securities, commonly known as "junk bonds,"
are usually defined as Ba or lower by Moody's or BB or lower by S&P. The Fund
may purchase unrated securities, which are not necessarily of lower quality than
rated securities but may not be attractive to as many buyers. Debt rated BB, B,
CCC, CC and C by S&P is regarded, on balance, as predominantly speculative with
respect to capacity to pay interest and repay principal in accordance with the
terms of the obligation. BB indicates the lowest degree of speculation and C the
highest degree of speculation. While such debt will likely have some quality and
protective characteristics, these are outweighed by large uncertainties or major
risk exposures to adverse conditions. Debt rated CI by S&P is debt (income
bonds) on which no interest is being paid. Debt rated D by S&P is in default and
payment of interest and/or repayment of principal is in arrears. The Fund
intends to invest in D-rated debt only in cases where, in the judgment of the
Fund's Advisor, there is a distinct prospect of improvement in the issuer's
financial position as a result of the completion of reorganization or otherwise.
Bonds that are rated Ca by Moody's are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal or
interest. Bonds that are rated Ca by Moody's represent obligations which are
speculative in a high degree. Such issues are often in default or have other
market shortcomings. Bonds that are rated C by Moody's are the lowest rated
class of bonds, and issues so rated can be regarded as having extremely poor
prospects of ever attaining any real investment standing.

Convertible Securities

Convertible securities include bonds, debentures, corporate notes,
preferred stocks and other securities. Convertible securities are securities
that the holder can convert into common stock. Convertible securities rank
senior to common stock in a corporation's capital structure and, therefore,
entail less risk than a corporation's common stock. The value of a convertible
security is a function of its investment value (Its market worth without a
conversion privilege) and its conversion value (its market worth if exchanged).
If a convertible security's investment value is greater than its conversion
value, its price primarily will reflect its investment value and will tend to
vary inversely with interest rates (the issuer's creditworthiness and other
factors may also affect its value). If a convertible security's conversion value
is greater than its investment value, its price will tend to be higher than its
conversion value and it will tend to fluctuate directly with the price of the
underlying equity security.

Investment Company Securities

Securities of other investment companies may be acquired by each of the
Funds to the extent permitted under the 1940 Act. These limits require that, as
determined immediately after a purchase is made, (i) not more than 5% of the
Fund's total assets will be invested in the securities of any one investment
company, (ii) not more than 10% of the value of its total assets will be
invested in the aggregate in securities of investment companies as a group, and
(iii) not more than 3% of the outstanding voting stock of any one investment
company will be owned by the Fund. As a shareholder of another investment
company, a Fund would bear, along with other shareholders, its pro rata portion
of the other investment company's expenses, including advisory

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fees. These expenses would be in addition to the advisory and other expenses
that the Fund bears directly in connection with its own operations. However, a
Fund may invest all of its investable assets in securities of a single open-end
management company with substantially the same fundamental investment
objectives, policies and limitations as a Fund.

Master Demand Notes

Master demand notes are unsecured obligations that permit the investment of
fluctuating amounts by the Funds at varying rates of interest pursuant to direct
arrangements between a Fund, as lender, and the issuer, as borrower. Master
demand notes may permit daily fluctuations in the interest rate and daily
changes in the amounts borrowed. A Fund has the right to increase the amount
under the note at any time up to the full amount provided by the note agreement,
or to decrease the amount. The borrower may repay up to the full amount of the
note without penalty. Notes purchased by a Fund permit the Fund to demand
payment of principal and accrued interest at any time (on not more than seven
days' notice). Notes acquired by a Fund may have maturities of more than one
year, provided that (1) the Fund is entitled to payment of principal and accrued
interest upon not more than seven days' notice, and (2) the rate of interest on
such notes is adjusted automatically at periodic intervals, which normally will
not exceed 31 days, but may extend up to one year. The notes are deemed to have
a maturity equal to the longer of the period remaining to the next interest rate
adjustment or the demand notice period. Because these types of notes are direct
lending arrangements between the lender and borrower, such instruments are not
normally traded and there is no secondary market for these notes, although they
are redeemable and thus repayable by the borrower at face value plus accrued
interest at any time. Accordingly, a Fund's right to redeem is dependent on the
ability of the borrower to pay principal and interest on demand. In connection
with master demand note arrangements, a Fund's Advisor considers, under
standards established by the Board of Trustees, earning power, cash flow and
other liquidity ratios of the borrower and will monitor the ability of the
borrower to pay principal and interest on demand. These notes are not typically
rated by credit rating agencies. Unless rated, a Fund may invest in them only if
at the time of an investment the issuer meets the criteria established for
commercial paper, which limits such investments to commercial paper rated A-1 by
S&P, Prime-1 by Moody's or F-1 by Fitch IBCA, Inc.

Obligations of Foreign Branches of United States Banks

The obligations of foreign branches of U.S. banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation and by government regulation.
Payment of interest and principal upon these obligations may also be affected by
governmental action in the country of domicile of the branch (generally referred
to as sovereign risk). In addition, evidences of ownership of such securities
may be held outside the U.S. and a Fund may be subject to the risks associated
with the holding of such property overseas. Examples of governmental actions
would be the imposition of currency controls, interest limitations, withholding
taxes, seizure of assets or the declaration of a moratorium. Various provisions
of federal law governing domestic branches do not apply to foreign branches of
domestic banks.

Obligations of United States Branches of Foreign Banks

Obligations of U.S. branches of foreign banks may be general obligations of
the parent bank in addition to the issuing branch, or may be limited by the
terms of a specific obligation and by federal and state regulation as well as by
governmental action in the country in which the foreign bank has its head
office. In addition, there may be less publicly available information about a
U.S. branch of a foreign bank than about a domestic bank.

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Repurchase Agreements

The Funds may enter into repurchase agreements with entities that are
registered U.S. government securities dealers, including member banks of the
Federal Reserve System having at least $1 billion in assets, primary dealers in
U.S. government securities or other financial institutions believed a Fund's
advisor to be creditworthy. A repurchase agreement is an agreement by which a
person (e.g., a Fund) obtains a security and simultaneously commits to return
the security to the seller (a member bank of the Federal Reserve System or
recognized securities dealer) at an agreed upon price (including principal and
interest) on an agreed upon date within a number of days (usually not more than
seven) from the date of purchase. The resale price reflects the purchase price
plus an agreed upon market rate of interest which is unrelated to the coupon
rate or maturity of the underlying security. A repurchase agreement involves the
obligation of the seller to pay the agreed upon price, which obligation is in
effect secured by the value of the underlying security.

A Fund's custodian or a third party will take possession of the securities
subject to repurchase agreements, and these securities will be marked to market
daily. To the extent that the original seller does not repurchase the securities
from a Fund, the Fund could receive less than the repurchase price on any sale
of such securities. In the event that such a defaulting seller filed for
bankruptcy or became insolvent, disposition of such securities by a Fund might
be delayed pending court action. The Funds believe that under the regular
procedures normally in effect for custody of a Fund's portfolio securities
subject to repurchase agreements, a court of competent jurisdiction would rule
in favor of the Fund and allow retention or disposition of such securities. The
Fund will only enter into repurchase agreements with banks and other recognized
financial institutions, such as broker-dealers, which are deemed by the advisor
to be creditworthy pursuant to guidelines established by the Trustees.

Reverse Repurchase Agreements

The Funds may also enter into reverse repurchase agreements. These
transactions are similar to borrowing cash. In a reverse repurchase agreement, a
Fund transfers possession of a portfolio instrument to another person, such as a
financial institution, broker, or dealer, in return for a percentage of the
instrument's market value in cash, and agrees that on a stipulated date in the
future the Fund will repurchase the portfolio instrument by remitting the
original consideration plus interest at an agreed upon rate.

The use of reverse repurchase agreements may enable a Fund to avoid selling
portfolio instruments at a time when a sale may be deemed to be disadvantageous,
but the ability to enter into reverse repurchase agreements does not ensure that
the Fund will be able to avoid selling portfolio instruments at a
disadvantageous time.

When effecting reverse repurchase agreements, liquid assets of a Fund, in a
dollar amount sufficient to make payment for the obligations to be purchased,
are segregated at the trade date. These securities are marked to market daily
and maintained until the transaction is settled.

Illiquid and Restricted Securities

Each Fund may not invest more than 15% of its net assets in securities that
are illiquid. A security is illiquid when a Fund cannot dispose of it in the
ordinary course of business within seven days at approximately the value at
which the Fund has the investment on its books.

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Each Fund may invest in "restricted" securities, i.e., securities subject to
restrictions on resale under federal securities laws. Rule 144A under the
Securities Act of 1933 ("Rule 144A") allows certain restricted securities to
trade freely among qualified institutional investors. Since Rule 144A securities
may have limited markets, the Board of Trustees will determine whether such
securities should be considered illiquid for the purpose of determining a Fund's
compliance with the limit on illiquid securities indicated above. In determine
the liquidity of Rule 144A securities, the Trustees will consider: (1) the
frequency of trades and quotes for the security; (2) the number of dealers
willing to purchase or sell the security and the number of other potential
buyers; (3) dealer undertakings to make a market in the security; and (4) the
nature of the security and the nature of the marketplace trades.

When-Issued, Delayed-Delivery and Forward Commitment Transactions

The Funds may purchase securities on a when-issued or delayed delivery
basis and may purchase or sell securities on a forward commitment basis. These
transactions involve the purchase of debt obligations with delivery and payment
normally take place within a month or more after the date of commitment to
purchase. The Funds will only make commitments to purchase obligations on a
when-issued basis with the intention of actually acquiring the securities, but
may sell them before the settlement date. The when-issued securities are subject
to market fluctuation, and no interest accrues on the security to the purchaser
during this period. The payment obligation and the interest rate that will be
received on the securities are each fixed at the time the purchaser enters into
the commitment.

Segregated accounts will be established, and the Funds will maintain liquid
assets in an amount at least equal in value to a Fund's commitments to purchase
when-issued securities. If the value of these assets declines, a Fund will place
additional liquid assets in the account on a daily basis so that the value of
the assets in the account is equal to the amount of such commitments.

Purchasing obligations on a when-issued basis is a form of leveraging and
can involve a risk that the yields available in the market when the delivery
takes place may actually be higher than those obtained in the transaction
itself. In that case there could be an unrealized loss at the time of delivery.

A Fund uses when-issued, delayed-delivery and forward commitment
transactions to secure what it considers to be an advantageous price and yield
at the time of purchase. When a Fund engages in when- issued, delayed-delivery
and forward commitment transactions, it relies on the buyer or seller, as the
case may be, to consummate the sale. If the buyer or seller fails to complete
the sale, then the Fund may miss the opportunity to obtain the security at a
favorable price or yield.

Typically, no income accrues on securities a Fund has committed to purchase
prior to the time delivery of the securities is made, although the Fund may earn
income on securities it has in a segregated account. When purchasing a security
on a when-issued, delayed delivery, or forward commitment basis, the Fund
assumes the rights and risks of ownership of the security, including the risk of
price and yield fluctuations, and takes such fluctuations into account when
determining its net asset value ("NAV"). Because the Fund is not required to pay
for the security until the delivery date, these risks are in addition to the
risks associated with the Fund's other investments.

Foreign Currency Transactions (Evergreen Select Special Equity Fund)

As one way of managing exchange rate risk, the Fund may enter into forward
currency exchange contracts (agreements to purchase or sell currencies at a
specified price and date). The

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exchange rate for the transaction (the amount of currency the Fund will deliver
and receive when the contract is completed) is fixed when the Fund enters into
the contract. The Fund usually will enter into these contracts to stabilize the
U.S. dollar value of a security it has agreed to buy or sell. The Fund intends
to use these contracts to hedge the U.S. dollar value of a security it already
owns, particularly if the Fund expects a decrease in the value of the currency
in which the foreign security is denominated. Although the Fund will attempt to
benefit from using forward contracts, the success of its hedging strategy will
depend on the Advisor's ability to predict accurately the future exchange rates
between foreign currencies and the U.S. dollar. The value of the Fund's
investments denominated in foreign currencies will depend on the relative
strengths of those currencies and the U.S. dollar, and the Fund may be affected
favorably or unfavorably by changes in the exchange rates or exchange control
regulations between foreign currencies and the U.S. dollar. Changes in foreign
currency exchange rates also may affect the value of dividends and interest
earned, gains and losses realized on the sale of securities and net investment
income and gains, if any, to be distributed to shareholders by the Fund. The
Fund may also purchase and sell options related to foreign currencies in
connection with hedging strategies.

MANAGEMENT OF THE TRUST

Set forth below are the Trustees and officers of the Trust and their
principal occupations and some of their affiliations over the last five years.
Unless otherwise indicated, the address for each Trustee and officer is 200
Berkeley Street, Boston, Massachusetts, 02116. Each Trustee is also a Trustee of
each of the other Trusts in the Evergreen Fund complex.
<TABLE>
<CAPTION>

Position with
<S> <C> <C>
Name Trust Principal Occupations for Last Five Years
- -------------------------- ------------------ --------------------------------------------------------------------------
Laurence B. Ashkin Trustee Real estate developer and construction consultant; and President of
(DOB: 2/2/28) Centrum Equities and Centrum Properties, Inc.

Charles A. Austin III Trustee Investment Counselor to Appleton Partners, Inc.; former Director,
(DOB: 10/23/34) Executive Vice President and Treasurer, State Street Research &
Management Company (investment advice); Director, The Andover
Companies (Insurance); and Trustee, Arthritis Foundation of New England.

K. Dun Gifford Trustee Trustee, Treasurer and Chairman of the Finance Committee, Cam
(DOB: 10/12/38) bridge College; Chairman Emeritus and Director, American Institute of
Food and Wine; Chairman and President, Oldways Preservation and Exchange
Trust (education); former Chairman of the Board, Director, and Executive
Vice President, The London Harness Company; former Managing Partner,
Roscommon Capital Corp.; former Chief Executive Officer, Gifford Gifts of
Fine Foods; and former Chairman, Gifford, Drescher & Associates
(environmental consulting).

James S. Howell Chairman of Former Chairman of the Distribution Foundation for the Carolinas; and
(DOB: 8/13/24) the Board of former Vice President of Lance Inc. (food manufacturing).
Trustees

Leroy Keith, Jr. Trustee Chairman of the Board and Chief Executive Officer, Carson Products
(DOB: 2/14/39) Company; Director of Phoenix Total Return Fund and Equifax, Inc.;
Trustee of Phoenix Series Fund, Phoenix Multi-Portfolio Fund, and The
Phoenix Big Edge Series Fund; and former President, Morehouse College.

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Position with
Name Trust Principal Occupations for Last Five Years
- -------------------------- ------------------ --------------------------------------------------------------------------
Gerald M. McDonnell Trustee Sales Representative with Nucor-Yamoto, Inc. (steel producer).
(DOB: 7/14/39)

Thomas L. McVerry Trustee Former Vice President and Director of Rexham Corporation; and
(DOB: 8/2/39) former Director of Carolina Cooperative Federal Credit Union.

William Walt Pettit Trustee Partner in the law firm of William Walt Pettit, P.A.
(DOB: 8/26/55)

David M. Richardson Trustee Vice Chair and former Executive Vice President, DHR International,
(DOB: 9/14/41) Inc. (executive recruitment); former Senior Vice President, Boyden
International Inc. (executive recruitment); and Director, Commerce
and Industry Association of New Jersey, 411 International, Inc., and
J&M Cumming Paper Co.

Russell A. Salton, III Trustee Medical Director, U.S. Health Care/Aetna Health Services; former
MD (DOB: 6/2/47) Managed Health Care Consultant; and former President, Primary Physician
Care.

Michael S. Scofield Trustee Attorney, Law Offices of Michael S. Scofield.
(DOB: 2/20/43)

Richard J. Shima Trustee Former Chairman, Environmental Warranty, Inc. (insurance agency);
(DOB: 8/11/39) Executive Consultant, Drake Beam Morin, Inc. (executive outplacement);
Director of Connecticut Natural Gas Corporation, Hartford Hospital, Old
State House Association Middlesex Mutual Assurance Company, and Enhance
Financial Services, Inc.; Chairman, Board of Trustees, Hartford Graduate
Center; Trustee, Greater Hartford YMCA; former Director, Vice Chairman
and Chief Investment Officer, The Travelers Corporation; former Trustee,
Kingswood-Oxford School; and former Managing Director and Consultant,
Russell Miller, Inc.

William J. Tomko* President and Senior Vice President and Operations Executive, BISYS Fund Services.
(DOB: 8/30/58) Treasurer

Nimish S. Bhatt* Vice President Vice President, Tax, BISYS Fund Services; former Assistant Vice
(DOB: 6/6/63) and Assistant President, Evergreen Asset Management Corp./First Union National
Treasurer Bank; former Senior Tax Consulting/Acting Manager, Investment Companies
Group, Price Waterhouse LLP, New York.

Bryan Haft* Vice President Team Leader, Fund Administration, BISYS Fund Services.
(DOB: 1/23/65)

Michael H. Koonce Secretary Senior Vice President and Assistant General Counsel, First Union
(DOB: 4/20/60) Corporation; former Senior Vice President and General Counsel,
Colonial Management Associates, Inc.
</TABLE>

*Address: BISYS Fund Services, 3435 Stelzer Road, Columbus, Ohio 43219-8001

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18

<PAGE>

Listed below is the Trustee compensation for the fiscal year ended June 30,
1998.

COMPENSATION TABLE
Total Compensation
Aggregate From Registrant And
Compensation Fund Complex Paid
Name Of Person From Registrant To Trustees
Laurence B. Ashkin $3,817 $71,399
Charles A. Austin $3,822 $57,800 (a)
K. Dun Gifford $3,696 $54,450
James S. Howell $4,846 $102,749 (b)
Leroy Keith Jr. $3,700 $55,950
Gerald M. McDonnell $3,821 $84,950*
Thomas L. McVerry $4,351 $90,700*
William Walt Pettit $3,155 $77,625*
David M. Richardson $3,629 $55,925
Russell A. Salton, III $3,845 $86,050*
Michael S. Scofield $3,876 $87,750
Richard J. Shima $3,699 $68,500

(a) $5,700 of this amount payable in later years as deferred compensation.
(b) $74,044 of this amount payable in later years as deferred compensation.
* Entire amount payable in later years as deferred compensation.

PRINCIPAL HOLDERS OF FUND SHARES

As of the date of this SAI, the officers and Trustees of the Trust owned as
a group less than 1% of the outstanding of any class of each Fund.

Set forth below is information with respect to each person who, to each
Fund's knowledge, owned beneficially or of record more than 5% of a class of a
Fund's outstanding shares as of October 1, 1998.

Evergreen Select Strategic Value Fund
Institutional Class

First Union National Bank/EB/INT/Cash Account 71.77%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

First Union National Bank/EB/INT/Reinvest Account 26.85%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

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Evergreen Select Strategic Value Fund
Institutional Service Class

Fiduciary Trust Company International 20.11%
FBO Corrine C Zimmerman
Attn: Securities Department, 97th Fl.
2 World Trade Center
New York, NY 10048-0772

Jefnat & Company/Oramella Tomassich Trust 14.85%
301 41st Street
Miami Beach, FL 33140

Percy Chubb III 11.69%
431 Claremont Road
Bernardsville, NJ 07924

Fiduciary Trust Company International 11.19%
FBO L Caldecot Chubb
Attn: Securities Department, 97th Fl.
2 World Trade Center
New York, NY 10048-0772

Tellson & Company/c/o Peapack-Gladstone Bank 8.11%
P.O. Box 178
Gladstone, NJ 07934

Wilmington Trust Co. of PA 6.83%
FBO Frank E English/C/O Mutual Funds
1100 N. Market Street
Wilmington, DE 19890-2262

FUBS & CO. FEBO Brenda M Atria 7.89%
201 S. College St.
Charolotte, NC 28288-1167
Evergreen Select Diversified Value Fund

Institutional Class
None

Evergreen Select Diversified Value Fund
Institutional Service Class

Bankers Trust Co. 84.63%
FBO Triangle Industries/Masters Trust
100 Plaza One M/S 3048
Jersey City, NJ 07311-3999

UMBSC & Co./FBO 34-0949-90-8 11.43%
Midwest Renal Associates Inc.
UMB Bank N A/Box 419260
Kansas City, MO 64141-6260

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Evergreen Select Large Cap Blend Fund
Institutional Class

First Union National Bank/EB/INT/Reinvest Account 50.63%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Patterson & Co./PNB Personal Trust Actng. 11.51%
P.O. Box 7829
Philadelphia, PA 19101-7829

First Union National Bank/EB/INT/Cash Account 37.87%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Large Cap Blend Fund
Charitable Class

First Union National Bank/EB/INT/Cash Account 97.64%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Large Cap Blend Fund
Institutional Service Class

Thomas F. Hackett/c/o Warren S. Beebe Jr., CPA 48.89%
P.O. Box 849
Oakhurst, NJ 07755-0849

Fubs & Co./First Union Brokerage 22.92%
Sipes Orchard Home
201 S College Street, 5th Floor
Charlotte, NC 28288-1167

First Union Brokerage Services 24.51%
Essex County Comm American Legion
29 Newell Drive
Bloomfield, NJ 07003

Evergreen Select Common Stock Fund
Institutional Class

First Union National Bank/EB/INT/Cash Account 99.15%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Common Stock Fund
Institutional Service Class

None

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<PAGE>

Evergreen Select Strategic Growth Fund
Institutional Class

First Union National Bank/EB/INT/Cash Account 51.94%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Patterson & Co. 8.03%
PNB Personal Trust Actng.
P.O. Box 7829
Philadelphia, PA 19101-7829

First Union National Bank/EB/INT/Reinvest Account 36.63%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Strategic Growth Fund
Institutional Service Class

Patterson & Co. 6.88%
PNB Personal Trust Actng.
P.O. Box 7829
Philadelphia, PA 19101-7829

Evergreen Select Equity Income Fund
Institutional Class

First Union National Bank/EB/INT/Cash Account 99.90%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Equity Income Fund
Institutional Service Class

Merrill Lynch Pierce Fenner & Smith Inc. 30.38%
FBO Hope W Babcock
9601 S Meridian Blvd. 3rd Fl.
Englewood, CO 80112-5905

First Union Brokerage Services 13.16%
John T Morris and Joy Robinson Morris JTWROS
524 Faculty Street
Boone, NC 28607

Acadia Trust, N.A. Trustee/FBO Robert Jenks 9.82%
511 Congress St;; 9th Fl.
Portland, ME 04101

Centre State Co. 5.20%
C/O First National Bank & Tr Co. Of Newtown
40 South St. / P.O. Box 158
Newtown, PA 18940-0158

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<PAGE>

Eunice Anne Carlyle Jackson 5.10%
1 The Square/Sandford Credition Devon
Ex17 4LW
England, UK

Helen M Nesbit Trustee/U/A dated 1/2/74 8.83%
Helen Nesbit Trust
2235 Walton Way
August, GA 30904

Evergreen Select Small Company Value Fund
Institutional Class

First Union National Bank/EB/INT/Reinvest Account 79.57%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

First Union National Bank/EB/INT/Cash Account 18.62%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Small Company Value Fund
Institutional Service Class

None

Evergreen Select Social Principles Fund
Institutional Class

First Union National Bank/EB/INT/Reinvest Account 70.58%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

First Union National Bank/EB/INT/Cash Account 29.42%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl.
Charlotte, NC 28202-1911

Evergreen Select Social Principles Fund
Institutional Service Class

First Union Brokerage Services/Susan L Dowtin 37.26%
708 Sunset Drive
Greensboro, NC 27408

First Union Brokerage Services/John J Scinto Trust 31.51%
80 Grandview Avenue
Port Chester, NY 10573

Thomas F Hackett/c/o Warren S Beebe Jr, CPA 31.23%
P.O. Box 849
Oakhurst, NJ 07755-0849

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<PAGE>

Evergreen Select Social Principles Fund
Charitable Class

First Union National Bank/EB/INT/Cash Account 97.66%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Balanced Fund
Institutional Class

First Union National Bank/EB/INT/Reinvest Account 55.35%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

First Union National Bank/EB/INT/Cash Account 44.65%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Balanced Fund
Institutional Service Class

None

Evergreen Select Equity Index Fund
Institutional Class

Patterson & Co./PNB Personal Trust Actng. 42.73%
P.O. Box 7829
Philadelphia, PA 19101-7829

Patterson & Co./PNB Personal Trust Actng. 19.85%
P.O. Box 7829
Philadelphia, PA 19101-7829

First Union National Bank/EB/INT/Reinvest Account 22.65%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Equity Index Fund
Institutional Service Class

None

Evergreen Select Special Equity Fund
Institutional Class

Patterson & Co./PNB Personal Trust Actng. 54.29%
P.O. Box 7829
Philadelphia, PA 19101-7829

Patterson & Co./PNB Personal Trust Actng. 25.76%
P.O. Box 7829
Philadelphia, PA 19101-7829

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<PAGE>

First Union National Bank/EB/INT/Reinvest Account 13.29%
Attn: Trust Operations Fund Group
401 S. Tryon St. 3rd Fl. CMG 1151
Charlotte, NC 28202-1911

Evergreen Select Special Equity Fund
Institutional Service Class

None

Evergreen Select Small Cap Growth Fund
Institutional Class

Worcester County Retirement System 18.62%
Attn: Michael J. Donoghue
Chairman & Treasurer
2 Main St. Rm. 3 Courthouse
Worcester, MA 01608--1116

First Union National Bank/Cash Account 5.64%
Attn: Trust Operations Fund Group
401 S. Tryon St.; 3rd Fl.
Charlotte, NC 28202-1911

First Union National Bank/RE-Invest Account 71.53
ATTN: Trust Operations Fund Group
401 South Tryon Street, 3rd Fl.
Charlotte, NC 28202-1911

Evergreen Select Small Cap Growth Fund
Institutional Service Class

None

INVESTMENT ADVISORY AND OTHER SERVICES

INVESTMENT ADVISORS

Each Fund's investment advisor (the "Advisor") is a subsidiary of First
Union Corporation ("First Union"), a bank holding company headquartered at 301
South College Street, Charlotte, North Carolina 28288-0630. First Union and its
subsidiaries provide a broad range of financial services to individuals and
businesses throughout the United States.

First Union National Bank ("FUNB") is the Advisor to each Fund other than
Evergreen Select Small Company Value Fund, Evergreen Select Special Equity Fund
and Evergreen Select Small Cap Growth Fund. FUNB is located at 201 South College
Street, Charlotte North Carolina 28288-0630.

Evergreen Asset Management Corp. ("Evergreen Asset") is the Advisor to
Evergreen Select Small Company Value Fund. Evergreen Asset is located at 2500
Westchester Avenue, Purchase, New York 10577. Lieber & Company, another First
Union subsidiary, is the Fund's sub-advisor. Lieber & Company is reimbursed by
Evergreen Asset for the direct and indirect costs of providing subadvisory
services to the Fund.

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<PAGE>

Meridian Investment Company ("Meridian") is the Advisor to Evergreen Select
Special Equity Fund. Meridian is located at 55 Valley Stream Parkway, Malvern,
Pennsylvania 19355.

Evergreen Investment Management Company ("EIMC"), formerly known as
Keystone Investment Management Company, is the Advisor to Evergreen Select Small
Cap Growth Fund. EIMC is located at 200 Berkeley Street, Boston, Massachusetts
02116-5034

Pursuant to each advisory agreement (the "Advisory Agreement" or,
collectively, the "Advisory Agreements") between the Trust and each Advisor, and
subject to the supervision of the Trust's Board of Trustees, each Advisor
furnishes to each Fund investment advisory, management and administrative
services, office facilities, and equipment in connection with its services for
managing the investment and reinvestment of each Fund's assets. Each Advisor
pays for all of the expenses incurred in connection with the provision of its
services.

The Funds pay for all charges and expenses, other than those specifically
referred to as being borne by the Advisor, including, but not limited to: (1)
custodian charges and expenses; (2) bookkeeping and auditors' charges and
expenses; (3) transfer agent charges and expenses; (4) fees and expenses of
Trustees who are not interested persons of a Fund, as defined in the 1940 Act
("Independent Trustees"); (5) brokerage commissions, brokers' fees and expenses;
(6) issue and transfer taxes; (7) costs and expenses under the distribution
plan; (8) taxes and trust fees payable to governmental agencies; (9) the cost of
share certificates; (10) fees and expenses of the registration and qualification
of Funds' shares with the Securities and Exchange Commission ("SEC") or under
state or other securities laws; (11) expenses of preparing, printing and mailing
prospectuses, SAIs, notices, reports and certain proxy materials to
shareholders; (12) expenses of shareholders' and Trustees' meetings; (13)
charges and expenses of legal counsel for the Funds and for the Independent
Trustees of the Trust; (14) charges and expenses of filing annual and other
reports with the SEC and other authorities; and (15) all extraordinary Fund
charges and expenses.

The Funds have agreed to pay the Advisor a fee for its services, expressed
as a percentage of average net assets, as set forth below. In addition, each
Advisor, other than Evergreen Select Small Cap Growth Fund has voluntarily
agreed to reduce its advisory fee, resulting in the net advisory fees that are
also indicated in the table below.

Annual Annual
Fund Advisory Fee Net Advisory Fee
Evergreen Select Strategic Value Fund 0.70% 0.60%
Evergreen Select Diversified Value Fund 0.60% 0.50%
Evergreen Select Large Cap Blend Fund 0.70% 0.60%
Evergreen Select Common Stock Fund 0.70% 0.53%
Evergreen Select Strategic Growth Fund 0.70% 0.58%
Evergreen Select Equity Income Fund 0.70% 0.60%
Evergreen Select Social Principles Fund 0.80% 0.67%
Evergreen Select Small Company Value Fund 0.90% 0.65%
Evergreen Select Balanced Fund 0.60% 0.50%
Evergreen Select Equity Index Fund 0.40% 0.12%
Evergreen Select Special Equity Fund 1.50% 0.74%
Evergreen Select Small Cap Growth Fund 0.80% 0.80%

Under the Advisory Agreement, any liability of the Advisor in connection
with rendering services thereunder is limited to situations involving its
willful misfeasance, bad faith, gross negligence or reckless disregard of its
duties.

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<PAGE>

Each Advisory Agreement continues in effect for two years from its
effective date and, thereafter, from year to year only if approved at least
annually by the Board of Trustees of the Trust or by a vote of a majority of a
Fund's outstanding shares (as defined in the 1940 Act). In either case, the
terms of the Advisory Agreement and continuance thereof must be approved by the
vote of a majority of the Independent Trustees cast in person at a meeting
called for the purpose of voting on such approval. Each Advisory Agreement may
be terminated, without penalty, on 60 days' written notice by the Trust's Board
of Trustees or by a vote of a majority of outstanding shares. Each Advisory
Agreement will terminate automatically upon its "assignment" as that term is
defined in the 1940 Act.

DISTRIBUTOR

Evergreen Distributor, Inc. (the "Distributor") markets the Funds through
broker-dealers and other financial representatives. The Distributor's address
is, 125 W. 55th Street, New York, N.Y. 10019.

DISTRIBUTION PLANS AND AGREEMENTS

Under the Rule 12b-1 Distribution Plans that have been adopted by each Fund
with respect to its Institutional Service Shares and the Class A and Class B
shares of Evergreen Select Equity Index Fund (each a "Plan" and collectively,
the "Plans"), the Treasurer of the Trust reports the amounts expended under the
Plans for a Fund and the purposes for which such expenditures were made to the
Trustees of the Trust for their review on a quarterly basis. Each Plan provides
that the selection and nomination of the Independent Trustees are committed to
the discretion of such Independent Trustees then in office. Also, the Plans
permit each Fund to deduct up to 0.25% of the Institutional Service class'
average net assets to pay for shareholder services.

Distribution fees are accrued daily and paid at least monthly on the Class
A and Class B shares of Evergreen Select Equity Index Fund and are charged as
class expenses, as accrued. The distribution fees attributable to the Class B
shares are designed to permit an investor to purchase such shares through
broker-dealers without the assessment of a front-end sales charge, while at the
same time permitting the Distributor to compensate broker-dealers in connection
with the sale of such shares. In this regard, the purpose and function of the
combined contingent deferred sales charge ("CDSC") and distribution services fee
on the Class B shares are the same as those of the front-end sales charge and
distribution fee with respect to the Class A shares in that in each case the
sales charge and/or distribution fee provide for the financing of the
distribution of the Fund's shares.

EIMC may from time to time from its own funds or such other resources as
may be permitted by rules of the SEC make payments for distribution services of
the Class A and Class B shares of Evergreen Select Equity Index Fund to the
Distributor; the latter may in turn pay part or all of such compensation to
brokers or other persons for their distribution assistance.

The Plans permit the payment of fees to brokers and others for distribution
and shareholder related administrative services and to broker-dealers,
depository institutions, financial intermediaries and administrators for
administrative services as to Class A and Class B shares of Evergreen Select
Equity Index Fund. The Plans are designed to (i) stimulate brokers to provide
distribution and administrative support services to the Fund and holders of
Class A and Class B shares, and (ii) stimulate administrators to render
administrative support services to the Fund and holders of Class A and Class B
shares. The administrative services are provided by a representative who has
knowledge of the shareholder's particular circumstances and goals, and include,
but are not limited

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<PAGE>

to, providing office space, equipment, telephone facilities, and various
personnel including clerical, supervisory, and computer, as necessary or
beneficial to establish and maintain shareholder accounts and records;
processing purchase and redemption transactions and automatic investments of
client account cash balances; answering routine client inquiries regarding Class
A and Class B shares; assisting clients in changing dividend options, account
designations, and addresses; and providing such other services as Evergreen
Select Equity Index Fund reasonably requests for its Class A and Class B shares.

In the event that a Plan or Distribution Agreement is terminated or not
continued with respect to one or more classes of a Fund, (i) no distribution
fees (other than current amounts accrued but not yet paid) would be owed by a
Fund to the Distributor with respect to that class or classes, and (ii) a Fund
would not be obligated to pay the Distributor for any amounts expended under the
Distribution Agreement not previously recovered by the Distributor from
distribution services fees in respect of shares of such class or classes through
deferred sales charges.

All material amendments to any Plan or Distribution Agreement must be
approved by a vote of the Trustees of the Trust or the holders of a Fund's
outstanding voting securities, voting separately by class, and in either case,
by a majority of the Independent Trustees, cast in person at a meeting called
for the purpose of voting on such approval; and any Plan or Distribution
Agreement may not be amended in order to increase materially the costs that a
particular class of shares of a Fund may bear pursuant to a Plan or Distribution
Agreement without the approval of a majority of the holders of the outstanding
voting shares of the class affected. Any Plan or Distribution Agreement may be
terminated (i) by a Fund without penalty at any time by a majority vote of the
holders of the outstanding voting securities of a Fund, voting separately by
class or by a majority vote of the Independent Trustees, or (ii) by the
Distributor. To terminate any Distribution Agreement, any party must give the
other parties 60 days' written notice; to terminate a Plan only, a Fund need
give no notice to the Distributor. Any Distribution Agreement will terminate
automatically in the event of its assignment.

For a summary of distribution fees paid by the Funds see "Financial
Information" below.

The National Association of Securities Dealers, Inc. ("NASD") limits the
amount that a mutual fund may pay annually in distribution costs for sale of its
shares and shareholder service fees. The NASD limits annual expenditures to
1.00% of the aggregate average daily NAV of its shares, of which 0.75% may be
used to pay such distribution costs and 0.25% may be used to pay shareholder
service fees. The NASD also limits the aggregate amount that a Fund may pay for
such distribution costs to 6.25% of gross share sales since the inception of the
distribution plan, plus interest at the prime rate plus 1.00% on such amounts
remaining unpaid from time to time.

ADDITIONAL SERVICE PROVIDERS

Administrator

Evergreen Investment Services, Inc. ("EIS") serves as administrator to each
Fund, subject to the supervision and control of the Trust's Board of Trustees.
EIS provides the Funds with facilities, equipment and personnel and is entitled
to receive a fee based on the aggregate average daily net assets of the Funds at
a rate based on the total assets of all mutual funds administered by EIS that
are advised by First Union subsidiaries. EIS' fee is calculated in accordance
with the following schedule:

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<PAGE>

Aggregate Net Total assets of
Administrator Fee First Union subsidiaries
- ----------------- ------------------------
0.050% of the first $7 billion, plus
0.035% of the next $3 billion, plus
0.030% of the next $5 billion, plus
0.020% of the next $10 billion, plus
0.015% of the next $5 billion, plus
0.010% of amounts over $30 billion.

Transfer Agent

Evergreen Service Company (the "Service Company"), a subsidiary of First
Union, is the Funds' transfer agent. The transfer agent issues and redeems
shares, pays dividends and performs other duties in connection with the
maintenance of shareholder accounts. The transfer agent's address is 200
Berkeley Street, Boston, Massachusetts 02116.

Independent Auditors

KPMG Peat Marwick LLP audits each Fund's financial statements. The
auditor's address is 99 High Street, Boston, Massachusetts 02110.

Custodian

State Street Bank and Trust Company is the Funds' custodian. The bank keeps
custody of each Fund's securities and cash and performs other related duties.
The custodian's address is P.O. Box 9021, Boston, Massachusetts 02205-9827.

BROKERAGE

SELECTION OF BROKERS

When buying and selling portfolio securities, each Advisor seeks brokers
who can provide the most benefit to the Fund or Funds for which a trade is being
made. When selecting a broker, an Advisor will primarily look for the best price
at the lowest commission, but in the context of the broker's:

1. ability to provide the best net financial result to the Fund;
2. efficiency in handling trades;
3. ability to trade large blocks of securities;
4. readiness to handle difficult trades;
5. financial strength and stability; and
6. provision of "research services," defined as (a) reports and analyses
concerning issuers, industries, securities and economic factors and (b)
other information useful in making investment decisions.

Under each Advisory Agreement, each Fund may pay higher brokerage
commissions to a broker providing it with research services, as defined in item
6, above. Pursuant to Section 28(e) of the Securities Exchange Act of 1934, this
practice is permitted if the commission is reasonably in relation to the
brokerage and research services provided. Research services provided by a broker
to

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<PAGE>

an Advisor do not replace, but supplement, the services an Advisor is required
to deliver to a Fund under the Advisory Agreement. It is impracticable for an
Advisor to allocate the cost, value and specific application of such research
services among its clients because research services intended for one client may
indirectly benefit another.

When selecting a broker for portfolio trades, an Advisor may also consider
the amount of Fund shares a broker has sold, subject to the other requirements
described above.

Lieber & Company, an affiliate of Evergreen Asset and a member of the New
York and American Stock Exchanges, will to the extent practicable effect
substantially all of the portfolio transactions for Evergreen Select Small
Company Value Fund.

BROKERAGE COMMISSIONS

Generally, each Fund expects to purchase and sell its equity portfolio
securities through brokerage transactions for which commissions are payable.
Purchases from underwriters will include the underwriting commission or
concession.

The Funds expect to buy and sell their fixed-income securities through
principal transactions, that is, directly from the issuer or from an underwriter
or market maker for the securities. Generally, the Funds will not pay brokerage
commissions for such purchases. Usually, when a Fund buys a security from an
underwriter, the purchase price will include an underwriting commission or
concession.

Prices of both equity and fixed-income securities purchased from dealers
serving as market makers will reflect the dealer's markup or markdown.

GENERAL BROKERAGE POLICIES

Generally, the Funds expect to purchase and sell their securities through
brokerage transactions for which commissions are payable. Where transactions are
made in the over-the-counter market, the Funds will deal with primary market
makers unless more favorable prices are otherwise obtainable.

The Advisor makes investment decisions for the Funds independently from
those of its other clients. It may frequently develop, however, that the Advisor
will make the same investment decision for more than one client. Simultaneous
transactions are inevitable when the same security is suitable for the
investment objective of more than one account. When two or more of its clients
are engaged in the purchase or sale of the same security, the Advisor will
allocate the transactions according to a formula that is equitable to each of
its clients. Although, in some cases, this system could have a detrimental
effect on the price or volume of the Funds' securities, the Funds believe that
in other cases their ability to participate in volume transactions will produce
better executions. In order to take advantage of the availability of lower
purchase prices, the Funds may occasionally participate in group bidding for the
direct purchase from an issuer of certain securities.

The Board of Trustees periodically reviews the Funds' brokerage policy.
Because of the possibility of further regulatory developments affecting the
securities exchanges and brokerage practices generally, the Board of Trustees
may change, modify or eliminate any of the foregoing practices.

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TRUST ORGANIZATION

FORM OF ORGANIZATION

The Trust was formed as a Delaware business trust under an Agreement and
Declaration of Trust dated September 18, 1997 (the "Declaration of Trust"). A
copy of the Declaration of Trust is on file at the SEC as an exhibit to the
Trust's Registration Statement, of which this SAI is a part. This summary is
qualified in its entirety by reference to the Declaration of Trust.

DESCRIPTION OF SHARES

The Declaration of Trust authorizes the issuance of an unlimited number of
shares of beneficial interest of series and classes of shares. Each share of a
Fund represents an equal proportionate interest with each other share of that
series and/or class. Upon liquidation, shares are entitled to a pro rata share
of the Trust based on the relative net assets of each series and/or class.
Shareholders have no preemptive or conversion rights. Shares are redeemable and
transferable.

VOTING RIGHTS

Under the terms of the Declaration of Trust, the Trust is not required to
hold annual meetings. At meetings called for the initial election of Trustees or
to consider other matters, each share is entitled to one vote for each dollar of
NAV applicable to such share. Shares generally vote together as one class on all
matters. Classes of shares of a Fund have equal voting rights. No amendment may
be made to the Declaration of Trust that adversely affects any class of shares
without the approval of a majority of the shares of that class. Shares have
non-cumulative voting rights, which means that the holders of more than 50% of
the shares voting for the election of Trustees can elect 100% of the Trustees to
be elected at a meeting and, in such event, the holders of the remaining shares
voting will not be able to elect any Trustees.

After the initial meeting as described above, no further meetings of
shareholders for the purpose of electing Trustees will be held, unless required
by law.

LIMITATION OF TRUSTEES' LIABILITY

The Declaration of Trust provides that a Trustee will not be liable for
errors of judgment or mistakes of fact or law, but nothing in the Declaration of
Trust protects a Trustee against any liability to which he would otherwise be
subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of his duties involved in the conduct of his office.

PURCHASE, REDEMPTION AND
PRICING OF FUND SHARES

HOW THE FUND OFFERS ITS SHARES TO THE PUBLIC
(Evergreen Select Equity Index Fund - Class A and Class B Shares)

You may buy the Class A and Class B shares of the Evergreen Select Equity
Index Fund through the Distributor, broker-dealers that have entered into
special agreements with the Distributor or certain other financial institutions.

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Class A Shares

With certain exceptions, when you purchase Class A shares you will pay a
maximum sales charge equal to 4.75% of the offering price. (The prospectus
contains a complete table of applicable sales charges and a discussion of sales
charge reductions or waivers that may apply to purchases. See also the section
in this SAI entitled "Financial Information" for an example of the method of
computing the offering price of Class A shares.) If you purchase Class A shares
in the amount of $1 million or more, without an initial sales charge, the Fund
will charge a CDSC of 1.00% if you redeem during the month of your purchase and
the 12-month period following the month of your purchase. See "Contingent
Deferred Sales Charge" below.

Class B Shares

The Fund offers Class B shares at NAV without an initial sales charge. With
certain exceptions, however, the Fund will charge a CDSC on shares you redeem
within 72 months after the month of your purchase, in accordance with the
following schedule:

Redemption Timing CDSC Rate
Month of purchase and the first 12-month
period following the month of purchase 5.00%
Second 12-month period following the month of purchase 4.00%
Third 12-month period following the month of purchase 3.00%
Fourth 12-month period following the month of purchase 3.00%
Fifth 12-month period following the month of purchase 2.00%
Sixth 12-month period following the month of purchase 1.00%
Thereafter 0.00%

Class B shares that have been outstanding for seven years after the
month of purchase will automatically convert to Class A shares without
imposition of a front-end sales charge or exchange fee. (Conversion of Class B
shares represented by stock certificates will require the return of the stock
certificate to the Service Company.)

CONTINGENT DEFERRED SALES CHARGE
(Evergreen Select Equity Index Fund - Class A and Class B Shares)

The Fund charges a CDSC as reimbursement for certain expenses, such as
commissions or shareholder servicing fees, that it has incurred in connection
with the sale of its shares (see "Distribution Plans and Agreements," above). If
imposed, the Fund deducts the CDSC from the redemption proceeds you would
otherwise receive. The CDSC is a percentage of the lesser of (1) the NAV of the
shares at the time of redemption or (2) the shareholder's original net cost for
such shares. Upon request for redemption, to keep the CDSC a shareholder must
pay as low as possible, the Fund will first seek to redeem shares not subject to
the CDSC and/or shares held the longest, in that order. The CDSC on any
redemption is, to the extent permitted by the NASD, paid to the Distributor or
its predecessor.

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SALES CHARGE WAIVERS OR REDUCTIONS
(Evergreen Select Equity Index Fund - Class A and Class B Shares)

Reducing Class A Front-end Loads

With a larger purchase, there are several ways that you can combine
multiple purchases of Class A shares in the Evergreen funds and take advantage
of lower sales charges.

Combined Purchases

You can reduce your sales charge by combining purchases of Class A
shares of multiple Evergreen funds. For example, if you invested $75,000 in each
of two different Evergreen funds, you would pay a sales charge based on a
$150,000 purchase (i.e., 3.75% of the offering price, rather than 4.75%).

Rights of Accumulation

You can reduce your sales charge by adding the value of Class A shares
of Evergreen funds you already own to the amount of your next Class A
investment. For example, if you hold Class A shares valued at $99,999 and
purchase an additional $5,000, the sales charge for the $5,000 purchase would be
at the next lower sales charge of 3.75%, rather than 4.75%.

Your account, and therefore your rights of accumulation, can be linked
t immediate family members which includes father and mother, brothers and
sisters, and sons and daughters. The same rule applies with respect to
individual retirement plans. Please note, however, that retired plans involving
employees stand alone and do not pass on rights of accumulation.

Letter of Intent

You can, by completing the "Letter of Intent" section of the
application, purchase Class A shares over a 13-month period and receive the same
sales charge as if you had invested all the money at once. All purchases of
Class A shares of an Evergreen fund during the period will qualify as Letter of
Intent purchases.

Waiver of Initial Sales Charges

The Fund may sell its shares at NAV without an initial sales charge to:

1. purchasers of shares in the amount of $1 million or more;
2. a corporate or certain other qualified retirement plan or a
non-qualified deferred compensation plan or a Title 1 tax
sheltered annuity or TSA plan sponsored by an organization having
100 or more eligible employees (a "Qualifying Plan") or a TSA
plan sponsored by a public educational entity having 5,000 or
more eligible employees (an "Educational TSA Plan");
3. institutional investors, which may include bank trust departments
and registered investment advisors;
4. investment advisors, consultants or financial planners who place
trades for their own accounts or the accounts of their clients
and who charge such clients a management, consulting, advisory or
other fee;

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5. clients of investment advisors or financial planners who place
trades for their own accounts if the accounts are linked to a
master account of such investment advisors or financial planners
on the books of the broker-dealer through whom shares are
purchased;
6. institutional clients of broker-dealers, including retirement and
deferred compensation plans and the trusts used to fund these
plans, which place trades through an omnibus account maintained
with a Fund by the broker-dealer;
7. employees of FUNB, its affiliates, the Distributor, any
broker-dealer with whom the Distributor, has entered into an
agreement to sell shares of the Funds, and members of the
immediate families of such employees;
8. certain Directors, Trustees, officers and employees of the
Evergreen funds, the Distributor or their affiliates and the
immediate families of such persons; or
9. a bank or trust company in a single account in the name of such
bank or trust company as trustee if the initial investment in or
any Evergreen fund made pursuant to this waiver is at least
$500,000 and any commission paid at the time of such purchase is
not more than 1% of the amount invested.

With respect to items 8 and 9 above, the Fund will only sell shares to
these parties upon the purchasers' written assurance that the purchase is for
their personal investment purposes only. Such purchasers may not resell the
securities except through redemption by the Fund. The Fund will not charge any
CDSC on redemptions by such purchasers.

Waiver of CDSC

The Fund does not impose a CDSC when the shares you are redeeming
represent:

1. an increase in the share value above the net cost of such shares;

2. certain shares for which the Fund did not pay a commission on
issuance, including shares acquired through reinvestment of dividend
income and capital gains distributions;

3. shares that are in the accounts of a shareholder who has died or
become disabled;

4. a lump-sum distribution from a 401(k) plan or other benefit plan
qualified under the Employee Retirement Income Security Act of 1974
("ERISA");

5. an automatic withdrawal from the ERISA plan of a shareholder who is a
least 59 1/2 years old;

6. shares in an account that the Fund has closed because the account
has an aggregate NAV of less than $1,000;

7. an automatic withdrawal under a Systematic Withdrawal Plan of up
to 1.0% per month of your initial account balance;

8. a withdrawal consisting of loan proceeds to a retirement plan
participant; 9. a financial hardship withdrawal made by a retirement
plan participant; and 10. a withdrawal consisting of returns of excess
contributions or excess deferral amounts made to a retirement plan.

EXCHANGES

Investors may exchange Class A and B shares of Evergreen Select Equity
Index Fund for shares of the same class of any other Evergreen fund. Investors
may exchange all other classes of shares of of the Funds for shares of the same
class of any other Evergreen "Select" fund. Exchanges are discussed in further
detail under "Exchanges" in each Fund's prospectus. Before you make an exchange,
you should read the prospectus of the fund into which you wish to exchange. The

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Trust reserves the right to discontinue, alter or limit the exchange privilege
at any time.

HOW AND WHEN THE FUNDS CALCULATE THEIR NET ASSET VALUE PER SHARE

Each Fund computes its NAV once daily on Monday through Friday, as
described in the prospectus. A Fund will not compute its NAV on the day the
following legal holidays are observed: New Year's Day, Martin Luther King, Jr.
Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving Day and Christmas Day.

A Fund calculates its NAV per share by adding up its investments and
other assets, subtracting its liabilities and then dividing the result by the
number of shares outstanding.

HOW THE FUNDS VALUE THE SECURITIES THEY OWN

Current values for a Fund's portfolio securities are determined in the
following manner:

(1) securities that are traded on a national securities exchange or the
over-the-counter National Market System ("NMS") are valued on the basis of the
last sales price on the exchange where primarily traded or NMS prior to the time
of the valuation, provided that a sale has occurred;

(2) securities traded in the over-the-counter market, other than on
NMS, are valued at the mean of the bid and asked prices at the time of
valuation;

(3) short-term investments maturing in more than 60 days for which
market quotations are readily available, are valued at such quotations;

(4) short-term investments maturing in 60 days or less (including all
master demand notes) are valued at amortized cost (original purchase cost as
adjusted for amortization of premium or accretion of discount), which, when
combined with accrued interest, approximates market;

(5) short-term investments maturing in more than 60 days when purchased
that are held on the 60th day prior to maturity are valued at amortized cost
(market value on the 60th day adjusted for amortization of premium or accretion
of discount), which, when combined with accrued interest, approximates market;
and

(6) securities, including restricted securities, for which complete
quotations are not readily available; listed securities or those on NMS if, in
the Fund's opinion, the last sales price does not reflect a current market value
or if no sale occurred; and other assets are valued at prices deemed in good
faith to be fair under procedures established by the Board of Trustees.

SHAREHOLDER SERVICES

As described in the Funds' prospectuses, a shareholder may elect to
receive his or her dividends and capital gains distributions in cash instead of
shares. However, the Service Company will automatically convert a shareholder's
distribution option so that the shareholder reinvests all dividends and
distributions in additional shares when it learns that the postal or other
delivery service is unable to deliver checks or transaction confirmations to the
shareholder's address of record. A Fund will hold the returned distribution or
redemption proceeds in a non interest-bearing account in the shareholder's name

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until the shareholder updates his or her address. Therefore, no interest will
accrue on amounts represented by uncashed distribution or redemption checks

PRINCIPAL UNDERWRITER

The Distributor, a subsidiary of The BISYS Group, Inc. is the principal
underwriter for each class of shares of each Fund. The Trust has entered into a
Principal Underwriting Agreement ("Underwriting Agreement") with the Distributor
with respect to each class of each Fund.

The Distributor, as agent, has agreed to use its best efforts to find
purchasers for the shares. The Distributor may retain and employ representatives
to promote distribution of the shares and may obtain orders from broker-dealers,
and others, acting as principals, for sales of shares to them. The Underwriting
Agreement provides that the Distributor will bear the expense of preparing,
printing, and distributing advertising and sales literature and prospectuses
used by it.

All subscriptions and sales of shares by the Distributor are at the
public offering price of the shares, which is determined in accordance with the
provisions of the Declaration of Trust, By-Laws, current prospectuses and SAI.
All orders are subject to acceptance by the Trust and the Trust reserves the
right, in its sole discretion, to reject any order received. Under the
Underwriting Agreement, the Trust is not liable to anyone for failure to accept
any order.

The Distributor has agreed that it will, in all respects, duly comply
with all state and federal laws applicable to the sale of the Funds' shares. The
Distributor and the Funds have both agreed to indemnify and hold each other
harmless and each person who has been, is, or may be a Trustee or officer of the
Trust against expenses reasonably incurred by any of them in connection with any
claim, action, suit, or proceeding to which any of them may be a party that
arises out of or is alleged to arise out of any misrepresentation or omission to
state a material fact on the part of the Distributor or any other person for
whose acts the Distributor is responsible or is alleged to be responsible,
unless such misrepresentation or omission was made in reliance upon written
information furnished by the Trust.

The Underwriting Agreement provides that it will remain in effect as
long as its terms and continuance are approved annually (i) by a vote of a
majority of the Trust's Independent Trustees, and (ii) by vote of a majority of
the Trustees, in each case, cast in person at a meeting called for that purpose.

The Underwriting Agreement may be terminated, without penalty, on 60
days' written notice by the Board of Trustees or by a vote of a majority of
outstanding shares subject to such agreement. The Underwriting Agreement will
terminate automatically upon its "assignment," as that term is defined in the
1940 Act.

From time to time, if, in the Distributor's judgment, it could benefit
the sales of shares, the Distributor may provide to selected broker-dealers
promotional materials and selling aids, including, but not limited to, personal
computers, related software, and data files.

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ADDITIONAL TAX INFORMATION

REQUIREMENTS FOR QUALIFICATION AS A REGULATED INVESTMENT COMPANY

Each Fund has qualified and intends to continue to qualify for and
elect the tax treatment applicable to a regulated investment company (a "RIC")
under Subchapter M of the Internal Revenue Code of 1986, as amended (the
"Code"). (Such qualification does not involve supervision of management or
investment practices or policies by the Internal Revenue Service.) In order to
qualify as a RIC, a Fund must, among other things, (i) derive at least 90% of
its gross income from dividends, interest, payments with respect to proceeds
from securities loans, gains from the sale or other disposition of securities or
foreign currencies and other income (including gains from options, futures or
forward contracts) derived with respect to its business of investing in such
securities; and (ii) diversify its holdings so that, at the end of each quarter
of its taxable year, (a) at least 50% of the market value of the Fund's total
assets is represented by cash, U.S. government securities and other securities
limited in respect of any one issuer, to an amount not greater than 5% of the
Fund's total assets and 10% of the outstanding voting securities of such issuer,
and (b) not more than 25% of the value of its total assets is invested in the
securities of any one issuer (other than U.S. government securities and
securities of other regulated investment companies). By so qualifying, a Fund is
not subject to federal income tax if it timely distributes its investment
company taxable income and any net realized capital gains. A 4% nondeductible
excise tax will be imposed on a Fund to the extent it does not meet certain
distribution requirements by the end of each calendar year. Each Fund
anticipates meeting such distribution requirements.

TAXES ON DISTRIBUTIONS

Distributions will be taxable to shareholders whether made in shares or
in cash. Shareholders electing to receive distributions in the form of
additional shares will have a cost basis for federal income tax purposes in each
share so received equal to the NAV of a share of a Fund on the reinvestment
date.

To calculate ordinary income for federal income tax purposes,
shareholders must generally include dividends paid by a Fund from its investment
company taxable income (net taxable investment income plus net realized
short-term capital gains, if any). The Funds will include dividends it receives
from domestic corporations when a Fund calculates its gross investment income.
The Funds anticipate that all or a portion of ordinary dividends which they pay
will qualify for the 70% dividends-received deduction for corporations. A Fund
will inform shareholders of the amounts that so qualify.

From time to time, a Fund will distribute the excess of its net
long-term capital gains over its short-term capital losses to shareholders. For
federal tax purposes, shareholders must include such distributions when
calculating their long-term capital gains. Each Fund will inform its
shareholders of the portion, if any, of a long-term capital gain distribution
which is subject to tax at the maximum 28% rate and the portion, if any, of a
long term capital gain distribution which is subject to tax at the maximum 20%
rate. Distributions of long-term capital gains are taxable as such to a
shareholder, no matter how long the shareholder has held the shares.

Distributions by a Fund reduce its NAV. A distribution that reduces a
Fund's NAV below a shareholder's cost basis is taxable as described above,
although from an investment standpoint, it

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is a return of capital. In particular, if a shareholder buys Fund shares just
before the Fund makes a distribution, when the Fund makes the distribution the
shareholder will receive what is in effect a return of capital. Nevertheless,
the shareholder may incur taxes on the distribution. Therefore, shareholders
should carefully consider the tax consequences of buying Fund shares just before
a distribution.

All distributions, whether received in shares or cash, must be reported
by each shareholder on his or her federal income tax return. Each shareholder
should consult a tax advisor to determine the state and local tax implications
of Fund distributions.

If more than 50% of the value of a Fund's total assets at the end of a
fiscal year is represented by securities of foreign corporations and a Fund
elects to make foreign tax credits available to its shareholders, a shareholder
will be required to include in his gross income both cash dividends and the
amount the Fund advises him is his pro rata portion of income taxes withheld by
foreign governments from interest and dividends paid on a Fund's investments.
The shareholder may be entitled, however, to take the amount of such foreign
taxes withheld as a credit against his U.S. income tax, or to treat the foreign
tax withheld as an itemized deduction from his gross income, if that should be
to his advantage. In substance, this policy enables the shareholder to benefit
from the same foreign tax credit or deduction that he would have received if he
had been the individual owner of foreign securities and had paid foreign income
tax on the income therefrom. As in the case of individuals receiving income
directly from foreign sources, the credit or deduction is subject to a number of
limitations.

TAXES ON THE SALE OR EXCHANGE OF FUND SHARES

Upon a sale or exchange of Fund shares, a shareholder will realize a
taxable gain or loss depending on his or her basis in the shares. A shareholder
must treat such gains or losses as a capital gain or loss if the shareholder
held the shares as capital assets. Capital gain on assets held for more than 12
months is generally subject to a maximum federal income tax rate of 20% for an
individual. Generally, the Code will not allow a shareholder to realize a loss
on shares he or she has sold or exchanged and replaced within a 61-day period
beginning 30 days before and ending 30 days after he or she sold or exchanged
the shares. The Code will treat a shareholder's loss on shares held for six
months or less as a long-term capital loss to the extent the shareholder
received capital gain dividends on such shares.

Shareholders who fail to furnish their taxpayer identification numbers to a
Fund and to certify as to its correctness and certain other shareholders may be
subject to a 31% federal income tax backup withholding requirement on dividends,
distributions of capital gains and redemption proceeds paid to them by a Fund.
If the withholding provisions are applicable, any such dividends or capital gain
distributions to these shareholders, whether taken in cash or reinvested in
additional shares, and any redemption proceeds will be reduced by the amounts
required to be withheld. Investors may wish to consult their own tax advisors
about the applicability of the backup withholding provisions.

OTHER TAX CONSIDERATIONS

The foregoing discussion relates solely to U.S. federal income tax law as
applicable to U.S. persons (i.e., U.S. citizens and residents and U.S. domestic
corporations, partnerships, trusts and estates). It does not reflect the special
tax consequences to certain taxpayers (e.g., banks, insurance companies, tax
exempt organizations and foreign persons). Shareholders are encouraged to
consult their own tax advisors regarding specific questions relating to federal,
state and local tax

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consequences of investing in shares of a Fund. Each shareholder who is not a
U.S. person should consult his or her tax advisor regarding the U.S. and foreign
tax consequences of ownership of shares of a Fund, including the possibility
that such a shareholder may be subject to a U.S. withholding tax at a rate of
30% (or at a lower rate under a tax treaty) on amounts treated as income from
U.S. sources under the Code.

FINANCIAL INFORMATION

EXPENSES

The expense information below pertaining to Evergreen Select Equity Index
Fund and Evergreen Select Special Equity Fund reflects operations under previous
investment advisor and service providers. These two Funds were formerly Equity
Index Fund and Special Equity Fund, respectively, portfolios of CoreFunds, Inc.
(the "Predecessor Funds"). They were reorganized into Evergreen funds in July
1998. Class Y Shares of the Predecessor Funds were reorganized into
Institutional Shares of their respective Evergreen funds. Class A and Class B
Shares of the Predecessor Funds were reorganized into Institutional Service
Shares of their respective Evergreen funds.

The table below shows the total dollar amounts paid by each Fund for
services rendered during the fiscal periods specified. For more information on
specific expenses, see "Investment Advisory and Other Services," "Distribution
Plans and Agreements," "Principal Underwriter" and "Purchase, Redemption and
Pricing of Shares."

Institutional Institutional Service Charitable
Advisory Fees 12b-1 Fees 12b-1 Fees 12b-1 Fees
1998 Fund Expenses
<S> <C> <C> <C> <C>
Strategic Value $930,128 N/A $334 N/A
Diversified Value $2,181,562 N/A $435 N/A
Large Cap Blend $2,031,616 N/A $186 N/A
Common Stock $8,171,550 N/A $8,623 N/A
Strategic Growth $1,235,649 N/A $4,792 N/A
Equity Income $862,925 N/A $815 N/A
Small Company Value $208,402 N/A $0 N/A
Social Principles $782,703 N/A $102 N/A
Balanced $1,954,563 N/A $114 N/A
Equity Index $1,139,118 N/A $2,000 N/A
Special Equity $1,208,084 N/A * N/A
Small Cap Growth $166,954 N/A $0 N/A
</TABLE>

* See "Distribution Fees" below.

For the period ended June 30, 1998 there were no outstanding Class A or Class B
shares of Evergreen Select Equity Index Fund.

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Advisory Fee Waivers

In accordance with voluntary expense limitations in effect during the
fiscal period ended June 30, 1998, the Advisor to each of the following Funds
voluntarily reimbursed or waived advisory fees, as follows:

Strategic Value $132,876
Diversified Value $363,594
Large Cap Blend $346,847
Common Stock $1,350,561
Strategic Growth $210,851
Equity Income $124,620
Small Company Value $58,160
Social Principles $129,970
Balanced $325,761
Equity Index $686,140
Special Equity $518,453

Distribution Fees

The table below shows the aggregate sales charges payable for the fiscal
years ended June 30, 1996, 1997 and 1998 to SEI Investments Distribution Co.
("SEI"), the Predecessor Funds' distributor, with respect to the Predecessor
Funds, Class A and Class B shares. The table also shows amounts retained by SEI.
<TABLE>
<CAPTION>

Predecessor Fund Aggregate Sales Charge Payable to SEI Amount Retained by SEI
1996 1997 1998 1996 1997 1998

<S> <C> <C> <C> <C> <C> <C>
Special Equity Fund $1,933 $39,047 $28,000 $286 $1,529 $28,000
Equity Index Fund 0 $188,470 $320,000 0 $6,846 $320,000
</TABLE>

BROKERAGE COMMISSIONS PAID

The table below shows for each Fund, other than Evergreen Select Special
Equity Fund and Evergreen Select Equity Index Fund, the total amounts paid in
brokerage commissions during the fiscal period specified.

Total Brokerage
Commission
=============================================== =====================
Fiscal Period Ended June 30, 1998
Strategic Value $145,302
Diversified Value $1,011,341

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Total Brokerage
Commission
=============================================== =====================
Large Cap Blend $415,687
Common Stock $1,063,426
Strategic Growth $464,814
Equity Income $269,886
Small Company Value $123,196
Social Principles $88,390
Balanced $281,280
Small Cap Growth $61,462

Percent of
Percent of Total Transactions
Commission Commission Pad Effected
Paid to Lieber to Lieber by Lieber

Fiscal Period Ended June 30, 1998
Small Company Value $96,640 78.44% 74.68%

The table below shows the brokerage commissions paid by the Predecessor
Funds of Evergreen Select Special Equity Fund and Evergreen Select Equity Index
Fund for the fiscal years ended June 30, 1996, 1997 and 1998.

Total Brokerage
Commission

Fiscal Period Ended June 30, 1996
Special Equity Fund $218,638
Equity Index Fund $91,443

Fiscal Period Ended June 30, 1997
Special Equity Fund $138,761
Equity Index Fund $89,787

Fiscal Period Ended June 30, 1998
Special Equity Fund $116,052
Equity Index Fund $102,434

PERFORMANCE DATA

Total Return

Total return quotations for a class of shares of a Fund as they may appear
from time to time in advertisements are calculated by finding the average annual
compounded rates of return over one-, five- and ten-year periods, or the time
periods for which such class of shares has been outstanding, whichever is
relevant, on a hypothetical $1,000 investment that would equate the initial
amount

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<PAGE>

invested in the class to the ending redeemable value. All dividends and
distributions are added to the initial investment and all recurring fees charged
to all shareholder accounts are deducted. The ending redeemable value assumes a
complete redemption at the end of the relevant periods.

The average annual total returns for each class of shares of the Funds,
other than Class A and Class B shares of Evergreen Select Equity Index Fund,
(including applicable sales charges) as of June 30, 1998 are as follows:

Fund/Class Since Inception Inception Date
============================ =============== ==============
Strategic Value
Institutional Shares 11.95% 11/24/97
Institutional Service Shares 1.68% 3/11/98
Diversified Value
Institutional Shares 10.76% 1/22/98
Institutional Service Shares (2.19)% 3/31/98
Large Cap Blend
Institutional Shares 14.31% 12/19/97
Institutional Service Shares 2.17% 3/12/98
Charitable Shares 13.18% 11/24/97
Common Stock
Institutional Shares 12.23% 11/24/97
Institutional Service Shares 6.29% 2/4/98
Strategic Growth 18.53% 11/24/97
Institutional Shares
Institutional Service Shares 6.29% 2/27/98
Equity Income
Institutional Shares 3.70% 11/24/97
Institutional Service Shares (1.16)% 3/11/98
Small Company Value
Institutional Shares 1.28% 12/23/97
Institutional Service Shares N/A 12/23/97
Social Principles
Institutional Shares 6.41% 11/24/97
Institutional Service Shares 1.32% 3/12/98
Charitable Shares 6.38% 11/24/97
Balanced
Institutional Shares 7.76% 1/22/98
Institutional Service Shares 1.23% 4/9/98
Small Cap Growth
Institutional Shares 13.76% 12/28/95
Institutional Service Shares N/A N/A

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Ten Years or Inception
Fund/Class One Year Five Years Since Inception Date
============================ ======== ========== =============== =======
Equity Index
Institutional Shares 29.17% 22.46% 17.46% 2/14/85
Institutional Service Shares 29.17% N/A 34.23% 10/9/96
Special Equity
Institutional Shares 14.23% N/A 24.84% 2/21/95
Institutional Service Shares 13.78% N/A 16.40% 3/15/94

Current Yield

From time to time, a Fund may quote its yield in advertisements or in
reports or other communications to shareholders. Yield quotations are expressed
in annualized terms and may be quoted on a compounded basis. Yields are computed
by dividing a Fund's interest income (as defined in the SEC yield formula) for a
given 30-day or one month period, net of expenses, by the average number of
shares entitled to receive distributions during the period, dividing this figure
by the Fund's net asset value per share at the end of the period and annualizing
the result (assuming compounding of income) in order to arrive at an annual
percentage rate. The formula for calculating yield is as follows:

YIELD = 2[(a-b/cd + 1)6-1]

Wherea = Dividends and interest earned during the period b = Expenses accrued
for the period (net of reimbursements)
c = The average daily number of shares outstanding during the period that
were entitled to receive dividends d = The maximum offering price per share
on the last day of the period

Income is calculated for purposes of yield quotations in accordance with
standardized methods applicable to all stock and bond funds. Gains and losses
generally are excluded from the calculation. Income calculated for purposes of
determining a Fund's yield differs from income as determined for other
accounting purposes. Because of the different accounting methods used, and
because of the compounding assumed in yield calculations, the yields quoted for
a Fund may differ from the rates of distributions the Fund paid over the same
period, or the net investment income reported in the Fund's financial
statements.

Yield information is useful in reviewing a Fund's performance, but because
yields fluctuate, such information cannot necessarily be used to compare an
investment in the Fund's shares with bank deposits, savings accounts and similar
investment alternatives which often provide an agreed or guaranteed fixed yield
for a stated period of time. Shareholders should remember that yield is a
function of the kind and quality of the instruments in a Fund's investment
portfolios, portfolio maturity, operating expenses and market conditions.

It should be recognized that in periods of declining interest rates the
yields will tend to be somewhat higher than prevailing market rates, and in
periods of rising interest rates the yields will tend to be somewhat lower.
Also, when interest rates are falling, the inflow of net new money to a Fund
from the continuous sale of its shares will likely be invested in instruments
producing lower yields than the balance of the Fund's investments, thereby
reducing the current yield of the Fund. In periods of rising interest rates, the
opposite can be expected to occur.

24723
43

<PAGE>

The yield for the 30-day period ended June 30, 1998 for each class of
shares offered by the Funds, other that Class A and Class B shares of Evergreen
Select Equity Index Fund, are set forth in the table below:

30-Day Yield

Institutional Institutional
Fund Shares Service Shares Charitable Shares
Strategic Value 1.40% 1.18% N/A
Diversified Value 0.94% 0.77% N/A
Large Cap Blend 0.70% 0.46% 0.70%
Common Stock 0.93% 0.70% N/A
Strategic Growth 0.14% (0.10%) N/A
Equity Income 2.70% 2.45% N/A
Small Company Value 0.10% N/A N/A
Social Principles 0.14% (0.10%) 0.14%
Balanced 3.22% 2.97% N/A
Small Cap Growth (0.93%) N/A N/A
Special Equity 0% 0% N/A
Equity Index 1.05% 0.99% N/A

Any given yield or total return quotation should not be considered
representative of a Fund's yield or total return for any future period.

Non-Standardized Performance

In addition to the performance information described above, a Fund may
provide total return information for designated periods, such as for the most
recent six months or most recent twelve months. This total return information is
computed as described under "Total Return" above except that no annualization is
made.

General

From time to time, a Fund may quote its performance in advertising and
other types of literature as compared to the performance of the Standard &
Poor's 500 Composite Stock Price Index, the Dow Jones Industrial Average,
Russell 2000 Index, or any other commonly quoted index of common stock prices.
The Standard & Poor's 500 Composite Stock Price Index, the Dow Jones Industrial
Average and the Russell 2000 Index are unmanaged indices of selected common
stock prices. A Fund's performance may also be compared to those of other mutual
funds having similar objectives. This comparative performance would be expressed
as a ranking prepared by Lipper Analytical Services, Inc. or similar independent
services monitoring mutual fund performance. A Fund's performance will be
calculated by assuming, to the extent applicable, reinvestment of all capital
gains distributions and income dividends paid. Any such comparisons may be
useful to investors who wish to compare a Fund's past performance with that of
its competitors. Of course, past performance cannot be a guarantee of future
results.

24723
44

<PAGE>

Financial Statements

The audited financial statements and the reports thereon for each of the
Funds, other than Evergreen Select Equity Index Fund and Evergreen Select
Special Equity Fund, are hereby incorporated by reference to the Funds' Annual
Report. The financial statements for Evergreen Select Equity Index Fund have
been audited by Ernst & Young LLP, independent auditors, for the periods from
inception through June 30, 1998. The financial statements for Evergreen Select
Special Equity Fund have been audited by Ernst & Young LLP for the periods from
November 1, 1995 through June 30, 1998 and by the Fund's prior auditor for the
periods ended October 31, 1994 through October 31, 1995. A report of Ernst &
Young LLP on the financial statements it has audited appears in the Funds'
Annual Report which is incorporated by reference. A copy of the Funds' Annual
Reports may be obtained without charge from the Service Company by calling
toll-free 1-800-343-2898 or by writing to the Service Company at P.O. Box 2121,
Boston, Massachusetts 02106-2121.

ADDITIONAL INFORMATION

Except as otherwise stated in its prospectuses or required by law, the
Trust reserves the right to change the terms of the offer stated in its
prospectuses for each Fund without shareholder approval, including the right to
impose or change fees for services provided.

No dealer, salesman or other person is authorized to give any information
or to make any representation not contained in a Fund's prospectus, SAI or in
supplemental sales literature issued by the Trust or the Distributor, and no
person is entitled to rely on any information or representation not contained
therein.

Each Fund's prospectus and this SAI omit certain information contained in
its registration statement, which may be obtained for a fee from the SEC in
Washington, D.C.

24723
45

<PAGE>

EVERGREEN SELECT EQUITY TRUST

PART C

OTHER INFORMATION

Item 24. Financial Statements and Exhibits

Item 24(a). Financial Statements

The financial statements listed below are included in Part A of this
Amendment to the Registration Statement.

Financial Highlights for:
<TABLE>
<CAPTION>

EVERGREEN SELECT STRATEGIC
<S> <C>
VALUE FUND - Institutional Shares For the period November 24, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT STRATEGIC VALUE
FUND - Institutional Service Shares For the period March 11, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT DIVERSIFIED
VALUE FUND - Institutional Shares For the period January 22, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT DIVERSIFIED VALUE
FUND - Institutional Service Shares For the period March 31, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT LARGE CAP BLEND
FUND - Institutional Shares For the period December 19, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT LARGE CAP BLEND
FUND - Institutional Service Shares For the period March 12, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT LARGE CAP BLEND
FUND - Charitable Shares For the period November 24, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT COMMON STOCK
FUND - Institutional Shares For the period November 24, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT COMMON STOCK
FUND - Institutional Service Shares For the period February 4, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT STRATEGIC GROWTH
FUND - Institutional Shares For the period November 24, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT STRATEGIC GROWTH
FUND - Institutional Service Shares For the period February 27, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT EQUITY INCOME
FUND - Institutional Shares For the period November 24, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT EQUITY INCOME
FUND - Institutional Service Shares For the period March 11, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT SMALL COMPANY
VALUE FUND - Institutional Shares For the period December 23, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT SOCIAL PRINCIPLES
FUND - Institutional Shares For the period November 24, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT SOCIAL PRINCIPLES
FUND - Institutional Service Shares For the period March 12, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT SOCIAL PRINCIPLES
FUND - Charitable Shares For the period November 24, 1997 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT BALANCED
FUND - Institutional Shares For the period January 22, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT BALANCED
FUND - Institutional Service Shares For the period April 9, 1998 (commencement of class operations) through June 30, 1998.

EVERGREEN SELECT SMALL CAP GROWTH
FUND - Institutional Shares For the four-month period ended June 30, 1998; for the year ended February 28, 1998; for
the eight-month period ended February 28, 1997; and for the period December 28, 1995
(commencement of class operations) through June 30, 1996.

EVERGREEN SELECT SPECIAL EQUITY
FUND - Institutional Shares For the two years ended June 30, 1998; for the seven-month period ended June 30, 1996; for
the year ended October 31, 1995; and for the period from March 15, 1994 (commencement of
operations) to October 31, 1994.

EVERGREEN SELECT SPECIAL EQUITY FUND
- Institutional Service Shares For the two years ended June 30, 1998; for the seven-month period ended June 30, 1996; for
the year ended October 31, 1995; and for the period from March 15, 1994 (commencement of
operations) to October 31, 1994.

EVERGREEN SELECT EQUITY INDEX
FUND - Institutional Shares For the seven years ended June 30, 1998; and for the period from June 1, 1991 (commencement
of operations) to June 30, 1991.

EVERGREEN SELECT EQUITY INDEX FUND
- Institutional Service Shares For the year ended June 30, 1998; and for the period from October 9, 1996 (commencement of
operations) to June 30, 1997.
</TABLE>

The financial statements listed below are incorporated by reference in
Part B of this Amendment to the Registration Statement:

Financial Highlights For the same share classes and
periods as included in Part A

Schedules of Investments As of June 30, 1998

Statements of Assets and As of June 30, 1998
Liabilities

Statements of Operations For the years or periods ended
June 30, 1998

Statements of Changes in For each of the years or periods
Net Assets ended in the two-year period
ended June 30, 1998

Combined Notes to Financial
Statements As of June 30, 1998

Independent Auditors' Report Dated July 31, 1998

Item 24(b). Exhibits

<TABLE>
<CAPTION>
Exhibit
Number Description Location
- ------- ----------- --------
<S> <C> <C>
1 Declaration of Trust Incorporated by reference to
Registrant's Pre-Effective Amendment No. 2
Filed on November 17, 1997

2 By-laws Incorporated by reference to
Registrant's Pre-Effective Amendment No. 2
Filed on November 17, 1997

3 Not applicable

4 Provisions of instruments defining the rights
of holders of the securities being registered
are contained in the Declaration of Trust
Articles II, V, VI, VIII, IX and By-laws
Articles II and VI included as part of Exhibits
1 and 2 of this Registration Statement

5(a) Investment Advisory Agreement between the Incorporated by reference to
Registrantand First Union National Bank Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

5(b) Investment Advisory Agreement between the Incorporated by reference to
Registrant and Evergreen Asset Management Co. Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

5(c) Investment Advisory Agreement between the Incorporated by reference to
Registrant and Keystone Investment Management Registrant's Post-Effective Amendment No. 4
Company Filed on June 30, 1998

5(d) Form of Investment Advisory Agreement between Incorporated by reference to
the Registrant and Meridian Investment Company Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

6 Principal Underwriting Agreement between the Incorporated by reference to
Registrant and Evergreen Distributor, Inc. Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

7 Form of Deferred Compensation Plan Incorporated by reference to
Registrant's Pre-Effective Amendment No. 2
Filed on November 17, 1997

8 Custodian Agreement between the Registrant Incorporated by reference to
and State Street Bank and Trust Company Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

9(a) Administration Agreement between Evergreen Incorporated by reference to
Investment Services, Inc. and the Registrant Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

9(b) Transfer Agent Agreement between the Incorporated by reference to
Registrant and Evergreen Service Company Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

10 Opinion and Consent of Sullivan & Worcester LLP Incorporated by reference to Registrant's
Pre-Effective Amendment No. 2 filed on
November 17, 1997

11(a) Consent of KPMG Peat Marwick LLP Contained herein

11(b) Consent of Ernst & Young LLP Contained herein

12 Not applicable

13 Not applicable

14 Not applicable

15(a) 12b-1 Distribution Plan for the Institutional Incorporated by reference to
Service Shares Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

15(b) Form of Distribution Plan of Class A shares Contained herein
(Evergreen Select Equity Index Fund)

15(c) Form of Distribution Plan for Class B shares Contained herein
(Evergreen Select Equity Index Fund)

16 Fund Performance Information Contained herein

17 Financial Data Schedules Contained herein

18 Multiple Class Plan Incorporated by reference to Registrant's
Pre-Effective Amendment No. 2 filed
on November 17, 1997

19 Powers of Attorney Incorporated by reference to
Registrant's Post-Effective Amendment No. 4
Filed on June 30, 1998

</TABLE>

Item 25. Persons Controlled by or Under Common Control with Registrant.

None

Item 26. Number of Holders of Securities (as of October 1, 1998)

Evergreen Select Strategic Value Fund
Institutional Shares 5
Institutional Service Shares 21
Evergreen Select Diversified Value Fund
Institutional Shares 3
Institutional Service Shares 3
Evergreen Select Large Cap Blend Fund
Institutional Shares 3
Institutional Service Shares 2
Charitable Shares 4
Evergreen Select Common Stock Fund
Institutional Shares 5
Institutional Service Shares 243
Evergreen Select Strategic Growth Fund
Institutional Shares 48
Institutional Service Shares 732
Evergreen Select Equity Income Fund
Institutional Shares 4
Institutional Service Shares 21
Evergreen Select Small Company Value Fund
Institutional Shares 5
Institutional Service Shares 0
Evergreen Select Social Principles Fund
Institutional Shares 2
Institutional Service Shares 3
Charitable Shares 3
Evergreen Select Balanced Fund
Institutional Shares 2
Institutional Service Shares 1
Evergreen Select Equity Index Fund
Institutional Shares 1,252
Institutional Service Shares 1,766
Class A Shares 0
Class B Shares 0
Evergreen Select Special Equity Fund
Institutional Shares 10
Institutional Service Shares 590
Evergreen Select Small Cap Growth Fund
Institutional Shares 15
Institutional Service Shares 0

Item 27. Indemnification.

Provisions for the indemnification of the Registrant's Trustees and
officers are contained the Registrant's Declaration of Trust, incorporated by
reference to Registrant's Pre-Effective Amendment No. 1 filed on November 17,
1997.

Provisions for the indemnification of the Registrant's Investment Advisors
are contained in their respective Investment Advisory and Management Agreements.

Provisions for the indemnification of Evergreen Distributor, Inc., the
Registrant's principal underwriter, are contained in the Principal Underwriting
Agreement between Evergreen Distributor, Inc. and the Registrant, a copy of
which is filed herewith.

Item 28. Business or Other Connections of Investment Advisors.

The Directors and principal executive officers of First Union National Bank
are:

Edward E. Crutchfield, Jr. Chairman and Chief Executive Officer,
First Union Corporation; Chief Executive
Officer and Chairman, First Union National
Bank

John R. Georgius Vice Chairman, First Union Corporation;
Vice Chairman, First Union National Bank

Marion A. Cowell, Jr. Executive Vice President, Secretary &
General Counsel, First Union Corporation;
Secretary and Executive Vice President,
First Union National Bank

Robert T. Atwood Executive Vice President and Chief Financial
Officer, First Union Corporation; Chief
Financial Officer and Executive Vice
President

All of the above persons are located at the following address: First Union
National Bank, One First Union Center, Charlotte, NC 28288.

The information required by this item with respect to Evergreen Asset
Management Corp. is incorporated by reference to the Form ADV (File No.
801-46522) of Evergreen Asset Management Corp.

The information required by this item with respect to Evergreen Investment
Management Company is incorporated by reference to the Form ADV (File No.
801-5436) of Evergreen Investment Management Company.

The information required by this item with respect to Meridian Investment
Company is incorporated by reference to the Form ADV (File No. 801-23484) of
Meridian Investment Company.

Item 29. Principal Underwriter.

The Directors and principal executive officers of Evergreen Distributor,
Inc. are:

Lynn C. Mangum Director, Chairman and Chief Executive
Officer

J. David Huber President

Kevin J. Dell Vice President, General Counsel and Secretary

All of the above persons are located at the following address: Evergreen
Distributor, Inc., 125 West 55th Street, New York, New York 10019.

Evergreen Distributor, Inc. acts as principal underwriter for each
registered investment company or series thereof that is a part of the Evergreen
"fund complex" as such term is defined in Item 22(a) of Schedule 14A under the
Securities Exchange Act of 1934.

Item 30. Location of Accounts and Records.

All accounts and records required to be maintained by Section 31(a) of the
Investment Company Act of 1940 and the Rules 31a-1 through 31a-3 promulgated
thereunder are maintained at one of the following locations:

Evergreen Investment Services, Inc., Evergreen Service Company and Keystone
Investment Management Company, all located at 200 Berkeley Street, Boston,
Massachusetts 02110

First Union National Bank, One First Union Center, 301 S. College Street,
Charlotte, North Carolina 28288

Evergreen Asset Management Corp., 2500 Westchester Avenue, Purchase,
New York 10577

Iron Mountain, 3431 Sharp Slot Road, Swansea, Massachusetts 02777

State Street Bank and Trust Company, 2 Heritage Drive, North Quincy,
Massachusetts 02171

Meridian Investment Company, 55 Valley Stream Parkway, Malvern,
Pennsylvania 19355

Item 31. Management Services.

Not Applicable

Item 32. Undertakings.

The Registrant hereby undertakes to furnish each person to whom a
prospectus is delivered with a copy of the Registrant's latest annual
report to shareholders, upon request and without charge.

<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940 the Registrant has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereto duly
authorized, in the City of New York, and State of New York, on the 28th day of
October, 1998.

EVERGREEN SELECT EQUITY TRUST

By: /s/ William J. Tomko
-----------------------------
Name: William J. Tomko
Title: President

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on the 28th day of October, 1998.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ William J. Tomko /s/ Laurence B. Ashkin /s/ Charles A. Austin, III
- ------------------------- ----------------------------- --------------------------------
William J. Tomko Laurence B. Ashkin* Charles A. Austin III*
President amd Treasurer (Principal Trustee Trustee
Financial and Accounting Officer)

/s/ K. Dun Gifford /s/ James S. Howell /s/ William Walt Pettit
- ---------------------------- ---------------------------- --------------------------------
K. Dun Gifford* James S. Howell* William Walt Pettit*
Trustee Trustee Trustee

/s/Gerald M. McDonnell /s/ Thomas L. McVerry /s/ Michael S. Scofield
- ------------------------------- ----------------------------- --------------------------------
Gerald M. McDonell* Thomas L. McVerry* Michael S. Scofield*
Trustee Trustee Trustee

/s/ David M. Richardson /s/ Russell A. Salton, III MD
- ------------------------------ -------------------------------
David M. Richardson* Russell A. Salton, III MD*
Trustee Trustee

/s/ Richard J. Shima
- ------------------------------
Richard J. Shima*
Trustee
</TABLE>

*By: /s/ Catherine E. Foley
- -------------------------------
Catherine E. Foley
Attorney-in-Fact

*Catherine E. Foley, by signing her name hereto, does hereby sign this
document on behalf of each of the above-named individuals pursuant to powers of
attorney duly executed by such persons.

<PAGE>

INDEX TO EXHIBITS

Exhibit
Number Exhibit
- ------- -------
11(a) Consent of KPMG Peat Marwick LLP
11(b) Consent of Ernst & Young LLP

15(b) Form of Distribution Plan of Class A shares
(Evergreen Select Equity Index Fund)

15(c) Form of Distribution Plan for Class B shares
(Evergreen Select Equity Index Fund)

16 Fund Performance

17 Financial Data Schedules

CONSENT OF INDEPENDENT AUDITORS

The Trustees and Shareholders
Evergreen Select Equity Trust:

We consent to the use of our report dated July 31, 1998 for Evergreen
Select Strategic Value Fund, Evergreen Select Diversified Value Fund, Evergreen
Select Large Cap Blend Fund, Evergreen Select Common Stock Fund, Evergreen
Select Strategic Growth Fund, Evergreen Select Equity Income Fund, Evergreen
Select Small Company Value Fund, Evergreen Select Social Principles Fund,
Evergreen Select Balanced Fund and Evergreen Select Small Cap Growth Fund
incorporated herein by reference and to the references to our firm under the
captions "FINANCIAL HIGHLIGHTS" in the prospectuses and "Independent Auditors"
in the statement of additional information included herein.

/s/ KPMG Peat Marwick LLp
KPMG Peat Marwick LLP

Boston, Massachusetts
October 28, 1998

CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS

We consent to the references to our firm under the captions "Financial
Highlights" in the Prospectuses and "Financial Statements" in the Statement of
Additional Information and to the incorporation by reference in this
Post-Effective Amendment No. 6 to the Registration Statement on Form N-1A (Nos.
333-36047/811-08363) of Evergreen Select Equity Trust (Evergreen Select Equity
Index Fund and Evergreen Select Special Equity Fund) of our report dated
August 25, 1998 on the CoreFunds, Inc. Equity Index Fund and Special Equity
Fund.

/s/ Ernst & Young LLP
Ernst & Young LLP

Philadelphia, Pennsylvania
October 26, 1998

DISTRIBUTION PLAN OF CLASS A SHARES
THE EVERGREEN SELECT EQUITY TRUST

SECTION 1. The Evergreen Select Equity Trust (the "Trust") individually
and/or on behalf of its series (each a "Fund") referred to in Exhibit A to this
Rule 12b-1 Plan of Distribution (the "Plan") may act as the distributor of
securities which are issued in respect of the Fund's Class A shares ("Shares"),
pursuant to Rule 12b-1 under the Investment Company Act of 1940 (the "1940 Act")
according to the terms of this Plan.

SECTION 2. The Trust on behalf of each Fund may expend daily amounts at
an annual rate of 0.75% of the average daily net asset value of Class A shares
("Shares") of the Fund. Such amounts may be expended to finance activity which
is principally intended to result in the sale of Shares including, without
limitation, expenditures consisting of payments to a principal underwriter of
the Fund ("Principal Underwriter") or others in order (i) to make payments to
the Principal Underwriter or others of sales commissions, other fees or other
compensation for services provided or to be provided, to enable payments to be
made by the Principal Underwriter or others for any activity primarily intended
to result in the sale of Shares, to pay interest expenses associated with
payments in connection with the sale of Shares and to pay any expenses of
financing permitted by this clause (i); (ii) to enable the Principal Underwriter
or others to receive, pay or to have paid to others who have sold Shares, or who
provide services to holders of Shares, a service fee, maintenance or other fee
in respect of such services, at such intervals as the Principal Underwriter or
such others may determine, in respect of Shares previously sold and remaining
outstanding during the period in respect of which such fee is or has been paid;
and/or (iii) to compensate the Principal Underwriter or others for efforts
(including without limitation any financing of payments under (i) and (ii) for
the sale of shares) in respect of sales of Shares since inception of the Plan or
any predecessor plan. Appropriate adjustments shall be made to the payments made
pursuant to this Section 2 to the extent necessary to ensure that no payment is
made by the Trust on behalf of any Fund with respect to the Class in excess of
the applicable limit imposed on asset based, front end and deferred sales
charges under subsection (d) of Rule 2830 of the Business Conduct Rules of the
National Association of Securities Dealers Regulation, Inc. (The "NASDR"). In
addition, to the extent any amounts paid hereunder fall within the definition of
an "asset based sales charge" under said NASDR Rule such payments shall be
limited to 0.75 of 1% of the aggregate net asset value of the Shares on an
annual basis and, to the extent that any such payments are made in respect of
"shareholder services" as that term is defined in the NASDR Rule, such payments
shall be limited to .25 of 1% of the aggregate net asset value of the Shares on
an annual basis and shall only be made in respect of shareholder services
rendered during the period in which such amounts are accrued.

SECTION 3. This Plan shall not take effect until it has been approved
together with any related agreements by votes of a majority of both (a) the
Board of Trustees of the Trust and (b) those Trustees of the Trust who are not
"interested persons" of the Trust (as defined in the 1940 Act) and who have no
direct or indirect financial interest in the operation of this Plan or any
agreements of the Fund or any other person related to this Plan ("Rule 12b-1
Trustees"), cast in person at a meeting called for the purpose of voting on this
Plan or such agreements.

SECTION 4. Unless sooner terminated pursuant to Section 6, this Plan
shall continue in effect for a period of one year from the date it takes effect
and thereafter shall continue in effect so long as such continuance is
specifically approved at least annually in the manner provided for approval of
this Plan in Section 3.

SECTION 5. Any person authorized to direct the disposition of monies
paid or payable by the Trust on behalf of each Fund pursuant to this Plan or any
related agreement shall provide to the Trust's Board of Trustees and the Board
shall review at least quarterly a written report of the amounts so expended and
the purposes for which such expenditures were made.

SECTION 6. This Plan may be terminated at any time with respect to any
Fund by vote of a majority of the Rule 12b-1 Trustees or by vote of a majority
of such Fund's outstanding Shares.

SECTION 7. Any agreement of the Fund related to this Plan shall be in
writing and shall provide:

(a) that such agreement may be terminated at any time, without
payment of any penalty, by vote of a majority of the Rule
12b-1 Trustees or by a vote of a majority of such Fund's
outstanding Shares on not more than sixty days written notice
to any other party to the agreement; and

(b) that such agreement shall terminate automatically in the event
of its assignment.

SECTION 8. This Plan may not be amended to increase materially the
amount of distribution expenses provided for in Section 2 hereof unless such
amendment is approved by a vote of at least a majority (as defined in the 1940
Act) of each Fund's outstanding Shares, and no material amendment to this Plan
shall be made unless approved in the manner provided for in Section 3 hereof.

Effective Date: October XX, 1998

<PAGE>

EXHIBIT A

EVERGREEN SELECT EQUITY TRUST
Evergreen Select Equity Index Fund

DISTRIBUTION PLAN OF CLASS B SHARES
EVERGREEN SELECT EQUITY TRUST

Section 1. The Evergreen Select Equity Trust (the "Trust"), individually
and/or on behalf of its series (each a "Fund") referred to in Exhibit A to this
12b-1 Distribution Plan (the "Plan") may act as the distributor of certain
securities of which it is the issuer, pursuant to Rule 12b-1 under the
Investment Company Act of 1940 (the "1940 Act") according to the terms of this
Plan.

Section 2. The Trust on behalf of each Fund may expend daily amounts at an
annual rate of 1.00% of the average daily net asset value of its Class B shares
("Shares") to finance any activity which is principally intended to result in
the sale of Shares including, without limitation, expenditures consisting of
payments to a principal underwriter of the Fund ("Principal Underwriter") or
others in order: (i) to enable payments to be made by the Principal Underwriter
or others for any activity primarily intended to result in the sale of Shares,
including, without limitation, (a) compensation to public relations consultants
or other persons assisting in, or providing services in connection with, the
distribution of Shares, (b) advertising, (c) printing and mailing of
prospectuses and reports for distribution to persons other than existing
shareholders, (d) preparation and distribution of advertising material and sales
literature, (e) commission payments, and principal and interest expenses
associated with the financing of commission payments, made by the Principal
Underwriter in connection with the sale of Shares and (f) conducting public
relations efforts such as seminars; (ii) to enable the Principal Underwriter or
others to receive, pay or to have paid to others who have sold Shares, or who
provide services to holders of Shares, a maintenance or other fee in respect of
services provided to holders of Shares, at such intervals as the Principal
Underwriter or such others may determine, in respect of Shares previously sold
and remaining outstanding during the period in respect of which such fee is or
has been paid; and/or (iii) to compensate the Principal Underwriter or such
others for their efforts in respect of sales of Shares since inception of the
Plan or any predecessor plan. Appropriate adjustments shall be made to the
payments made pursuant to this Section 2 to the extent necessary to ensure that
no payment is made on behalf of any Fund with respect to Class B Shares in
excess of any limit imposed on asset based, front end and deferred sales charges
under any rule or regulations adopted by the National Association of Securities
Dealers, Inc. (the "NASD Rules"). In addition, to the extent any amounts paid
hereunder fall within the definition of an "asset based sales charge" under said
NASD Rules such payments shall be limited to .75 of 1% of the aggregate net
asset value of the Shares on an annual basis and, to the extent that any such
payments are made in respect of "shareholder services" as that term is defined
in the NASD Rules, such payments shall be limited to .25 of 1% of the aggregate
net asset value of the Shares on

-1-

<PAGE>

an annual basis and shall only be made in respect of shareholder services
rendered during the period in which such amounts are accrued.

Section 3. This Plan shall not take effect with respect to any Fund until it has
been approved by votes of a majority of (a) the Trustees of the Trust, and (b)
those Trustees of the Trust who are not "interested persons" (as defined in the
1940 Act) and who have no direct or indirect financial interest in the operation
of this Plan or any agreements of the Trust related hereto or any other person
related to this Plan ("Disinterested Trustees"), cast in person at a meeting
called for the purpose of voting on this Plan. In addition, any agreement
related to this Plan and entered into by the Trust on behalf of the Fund in
connection therewith shall not take effect until it has been approved by votes
of a majority of (a) the Board of Trustees of the Trust, and (c) the
Disinterested Trustees of the Trust.

Section 4. Unless sooner terminated pursuant to Section 6, this Plan shall
continue in effect for a period of one year from the date it takes effect and
thereafter shall continue in effect for additional periods that shall not exceed
one year so long as such continuance is specifically approved by votes of a
majority of both (a) the Board of Trustees of the Trust and (b) the
Disinterested Trustees of the Trust, cast in person at a meeting called for the
purpose of voting on this Plan, provided that payments for services theretofore
provided or for reimbursement of expenses theretofore incurred or accrued prior
to termination of this Plan in accordance with Section 2 may be continued by the
Fund to the extent provided for in Section 6, below, as applicable.

Section 5. Any person authorized to direct the disposition of monies paid
or payable pursuant to this Plan or any related agreement shall provide to the
Trust's Board and the Board shall review at least quarterly a written report of
the amounts so expended and the purposes for which such expenditures were made.

Section 6. Payments with respect to services provided by the Principal
Underwriter or others pursuant to Section 2, above, shall be authorized
hereunder, whether or not this Plan has been otherwise terminated, if such
payments are for services theretofore provided or for reimbursement of expenses
theretofore incurred or accrued prior to termination of this Plan in other
respects and if such payment is or has been so approved by the Board, including
the Disinterested Trustees, or agreed to on behalf of the Fund with such
approval, all subject to such specific implementation as the Board, including
the Disinterested Trustees, may approve; provided that, at the time any such
payment is made, whether or not this Plan has been otherwise terminated, the
making of such payment will not cause the limitation upon such payments set
forth in Section 2 to be exceeded. Without limiting the generality of the
foregoing, the Trust on behalf of any Fund may pay to, or on the order of, any
person who has

-2-

<PAGE>

served from time to time as Principal Underwriter amounts for distribution
services pursuant to a principal underwriting agreement or otherwise. Any such
principal underwriting agreement may, but need not, provide that such Principal
Underwriter may be paid for distribution services to Class B Shares and/or other
specified classes of shares of any Fund (together the "B-Class-of-Shares"), a
fee which may be designated a Distribution Fee and may be paid at a rate per
annum up to .75 % of the average daily net asset value of such B-Class-of-Shares
of the Fund and may, but need not, also provide: (i) that a Principal
Underwriter will be deemed to have fully earned its "Allocable Portion" of the
Distribution Fee upon the sale of the Commission Shares (as defined in the
Allocation Schedule) taken into account in determining its Allocable Portion;
(ii) that the Fund's obligation to pay such Principal Underwriter its Allocable
Portion of the Distribution Fee shall be absolute and unconditional and shall
not be subject to dispute, offset, counterclaim or any defense whatsoever (it
being understood that such provision is not a waiver of the Fund's right to
pursue such Principal Underwriter and enforce such claims against the assets of
such Principal Underwriter other than its right to its Allocable Portion of the
Distribution Fee and CDSCs (as defined below); (iii) that the Fund's obligation
to pay such Principal Underwriter its Allocable Portion of the Distribution Fee
shall not be changed or terminated except to the extent required by any change
in applicable law, including without limitation, the 1940 Act, the Rules
promulgated thereunder by the Securities and Exchange Commission and the
Business Conduct Rules of the National Association of Securities Dealers, Inc.,
in each case enacted or promulgated after May 5, 1997, or in connection with a
"Complete Termination" (as hereinafter defined); (iv) that the Trust on behalf
of any Fund will not waive or change any contingent deferred sales charge
("CDSC") in respect of the Distributor's Allocable Portion thereof, except as
provided in the Fund's prospectus or statement of additional information without
the consent of the Principal Underwriter or any assignee of such Principal
Underwriter's rights to its Allocable Portion; (v) that the termination of the
Principal Underwriter, the principal underwriting agreement or this Plan will
not terminate such Principal Underwriter's rights to its Allocable Portion of
the CDSCs; and (vi) that any Principal Underwriter may assign its rights to its
Allocable Portion of the Distribution Fee and CDSCs (but not such Principal
Underwriter's obligations to the Fund under its principal underwriting
agreement) to raise funds to make expenditures described in Section 2 above and
in connection therewith, and upon receipt of notice of such assignment, the
Trust on behalf of any Fund shall pay to the assignee such portion of the
Principal Underwriter's Allocable Portion of the Distribution Fee and CDSCs so
assigned. For purposes of such principal underwriting agreement, the term
Allocable Portion of Distribution Fee as applied to any Principal Underwriter
may mean the portion of the Distribution Fee allocable to Distributor Shares in
accordance with the "Allocation Schedule" attached to such Principal
Underwriter's principal underwriting agreement. For purposes of such principal
underwriting agreement, the term Allocable Portion of CDSCs as applied to any
Principal Underwriter may mean the portion of the CDSCs

-3-

<PAGE>

allocable to Distributor Shares in accordance with the Allocation Schedule
attached to such Principal Underwriter's principal underwriting agreement. For
purposes of such principal underwriting agreement, the term "Complete
Termination" may mean a termination of this Plan involving the cessation of
payments of the Distribution Fee thereunder, the cessation of payments of
distribution fees pursuant to every other Rule 12b-1 plan of the Fund for every
existing or future B-Class-of-Shares and the cessation of the offering by the
Fund of existing or future B-Class-of-Shares, which conditions shall be deemed
to be satisfied when they are first complied with and so long thereafter as they
are complied with prior to the earlier of (i) the date upon which all of the B
Shares which are Distributor Shares pursuant to the Allocation Schedule shall
have been redeemed or converted or (ii) a specified date, after either of which
times such conditions need no longer be complied with. For purposes of such
principal underwriting agreement, the term "B-Class-of-Shares" may mean the B
Class of Shares of the Fund and each other class of shares of the Fund hereafter
issued which would be treated as "Shares" under such Allocation Schedule or
which has economic characteristics substantially similar to those of the B Class
of Shares taking into account the total sales charge, CDSC or other similar
charges borne directly or indirectly by the holder of the shares of such
classes.

The parties may agree that the existing C Class of Shares of the Fund does
not have substantially similar economic characteristics to the B Classes of
Shares taking into account the total sales charge, CDSC or other similar charges
borne directly or indirectly by the holder of such shares. For purposes of
clarity the parties to such principal underwriting agreement may state that they
intend that a new installment load class of shares which may be authorized by
amendments to Rule 6(c)-10 under the 1940 Act will not be considered to be a
B-Class-of-Shares if it has economic characteristics substantially similar to
the economic characteristics of the existing C Class of Shares taking into
account the total sales charge, CDSC or other similar charges borne directly or
indirectly by the holder of such shares and will not be considered to be a
B-Class-of-Shares if it has economic characteristics substantially similar to
the economic characteristics of the existing C Class of shares of the Fund
taking into account the total sales charge, CDSC or other similar charges borne
directly or indirectly by the holder of such shares. For purposes of such
principal underwriting agreement, "Allocation Schedule" may mean a schedule
which shall be approved by Trustees (as defined below) in connection with their
required approval of such principal underwriting agreement as assigning to each
Principal Underwriter of Shares the portion of the total Distribution Fee
payable by the Trust on behalf of each Fund under such principal underwriting
agreement which has been earned by such Principal Underwriter to the extent
necessary so that the continued payments thereof if such Principal Underwriter
ceases

-4-

<PAGE>

to serve in that capacity does not penalize the Fund by requiring the Trust on
behalf of such Fund to pay for services that have not been earned.

Section 7. This Plan may be terminated at any time with respect to any Fund
by vote of a majority of the Disinterested Trustees, or by vote of a majority of
the Shares of such Fund, provided that payments for services theretofore
provided or for reimbursement of expenses theretofore incurred or accrued prior
to termination of this Plan in accordance with Section 2 may be continued by the
Fund to the extent provided for in Section 6, above, as applicable.

Section 8. Any agreement of the Trust, with respect to any Fund, related to
this Plan shall be in writing and shall provide:

A. That such agreement may be terminated with respect to any Fund at any
time without payment of any penalty, by vote of a majority of the Disinterested
Trustees or by a vote of a majority of the outstanding Shares of such Fund on
not more than sixty days written notice to any other party to the agreement; and

B. That such agreement shall terminate automatically in the event of its
assignment.

Section 9. This Plan may not be amended to increase materially the amount
of distribution expenses provided for in Section 2 with respect to a Fund unless
such amendment is approved by a vote of at least a majority (as defined in the
1940 Act) of the outstanding Shares of such Fund, and no material amendment to
this Plan shall be made unless approved by votes of a majority of (a) the Board
of Trustees of the Trust, and (c) the Disinterested Trustees of the Trust, cast
in person at a meeting called for the purpose of voting on such amendment.

Effective Date: October XX, 1998

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<PAGE>
EXHIBIT A

EVERGREEN SELECT EQUITY TRUST
Evergreen Select Equity Index Fund

-6-

<PAGE>

SELECT BALANCED I
I
ACCOUNT I AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,077.57 0.00%
31-May-98 1 M 1,042.31 3.38% 3.38%
31-Mar-98 QTR 1,062.89 1.38% 1.38%
31-Dec-97 YTD
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
22-Jan-98 INCEPT. 1,000.00 7.76% 18.58%

INCEPTION FACTOR: 0.4384

SELECT BALANCED IS

IS
ACCOUNT IS AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,012.33 0.00%
31-May-98 1 MO 979.51 3.35% 3.35%
31-Mar-98 QTR
31-Dec-97 YTD
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
9-Apr-98 INCEPT. 1,000.00 1.23% 5.54%

INCEPTION FACTOR: 0.2274

COMMON STOCK I

ACCOUNT Y AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,122.34 0.00%
31-May-98 1 MO 1,100.88 1.95% 1.95%
31-Mar-98 QTR 1,121.67 0.06% 0.06%
31-Dec-97 YTD 1,001.96 12.01% 12.01%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
24-Nov-97 INCEPT. 1,000.00 12.23% 21.21%

INCEPTION FACTOR: 0.6

COMMON STOCK IS

IS
ACCOUNT IS AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,092.72 0.00%
31-May-98 1 MO 1,071.96 1.94% 1.94%
31-Mar-98 QTR 1,092.78 -0.01% -0.01%
31-Dec-97 YTD
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
4-Feb-98 INCEPT. 1,000.00 9.27% 24.63%

INCEPTION FACTOR: 0.4027

SOCIAL PRINCIPLES I

I
ACCOUNT I AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,064.08 0.00%
31-May-98 1 MO 1,031.58 3.15% 3.15%
31-Mar-98 QTR 1,073.18 -0.85% -0.85%
31-Dec-97 YTD 976.64 8.95% 8.95%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
24-Nov-97 INCEPT. 1,000.00 6.41% 10.91%

INCEPTION FACTOR: 0.6

SOCIAL PRINCIPLES IS

IS
ACCOUNT IS AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,013.22 0.00%
31-May-98 1 MO 982.52 3.13% 3.13%
31-Mar-98 QTR 1,022.63 -0.92% -0.92%
31-Dec-97 YTD
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
12-Mar-98 INCEPT. 1,000.00 1.32% 4.41%

INCEPTION FACTOR: 0.3041

SOCIAL PRINCIPLES IC

IC
ACCOUNT IC AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,063.81 0.00%
31-May-98 1 MO 1,031.58 3.12% 3.12%
31-Mar-98 QTR 1,073.18 -0.87% -0.87%
31-Dec-97 YTD 976.64 8.92% 8.92%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
24-Nov-97 INCEPT. 1,000.00 6.38% 10.86%

INCEPTION FACTOR: 0.6

SPECIAL EQUITY I

Fund Name Select Special Equity Fund

07/01/1997 to 06/30/1998 14.23%
07/01/1995 to 06/30/1998 22.43%
07/01/1993 to 06/30/1998 N/A
07/01/1988 to 06/30/1998 N/A
Inception to 06/30/1998 24.84%

SPECIAL EQUITY IS

Fund Name Select Special Equity Fund
07/01/1997 to 06/30/1998 13.78%
07/01/1995 to 06/30/1998 22.15
07/01/1993 to 06/30/1998 N/A
07/01/1988 to 06/30/1998 N/A
Inception to 06/30/1998 16.40%

LARGE CAP BLEND I
I
ACCOUNT I AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,143.10 0.00%
31-May-98 1 MO 1,088.07 5.06% 5.06%
31-Mar-98 QTR 1,138.44 0.41% 0.41%
31-Dec-97 YTD 1,032.97 10.66% 10.66%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
19-Dec-97 INCEPT. 1,000.00 14.31% 28.61%

INCEPTION FACTOR: 0.5315

LARGE CAP BLEND IS

IS
ACCOUNT Y AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,021.68 0.00%
31-May-98 1 MO 972.69 5.04% 5.04%
31-Mar-98 QTR 1,018.13 0.35% 0.35%
31-Dec-97 YTD
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
13-Mar-98 INCEPT. 1,000.00 2.17% 7.38%

INCEPTION FACTOR: 0.3014

LARGE CAP BLEND IC

IC
ACCOUNT IC AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,131.83 0.00%
31-May-98 1 MO 1,077.34 5.06% 5.06%
31-Mar-98 QTR 1,127.21 0.41% 0.41%
31-Dec-97 YTD 1,022.78 10.66% 10.66%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
24-Nov-97 INCEPT. 1,000.00 13.18% 22.92%

INCEPTION FACTOR: 0.6

DIVERSIFIED VALUE I

Y
ACCOUNT Y AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 4,471.54 0.00%
31-May-98 1 MO 4,373.41 2.24% 2.24%
31-Mar-98 QTR 4,516.62 -1.00% -1.00%
31-Dec-97 YTD 3,090.58 44.68% 44.68%
30-Jun-97 1 2,769.94 61.43% 61.43%
30-Jun-95 3 1,832.21 144.05% 34.64%
30-Jun-93 5 1,448.14 208.78% 25.29%
30-Jun-88 10
22-Jan-98 INCEPT. 4,037.01 10.76% 26.26%

INCEPTION FACTOR: 0.4384

DIVERSIFIED VALUE IS

IS
ACCOUNT IS AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 4,404.69 0.00%
31-May-98 1 MO 4,309.60 2.21% 2.21%
31-Mar-98 QTR 3,503.40 25.73% 25.73%
31-Dec-97 YTD 3,147.10 39.96% 39.96%
30-Jun-97 1 2,816.67 56.38% 56.38%
30-Jun-95 3 1,852.29 137.80% 33.48%
30-Jun-93 5 1,458.15 202.07% 24.74%
30-Jun-88 10
1-Apr-98 INCEPT. 4,503.40 -2.19% -8.51%

INCEPTION FACTOR: 0.2493

STRATEGIC VALUE I
I
ACCOUNT I AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,119.52 0.00%
31-May98 1 MO 1,114.85 0.42% 0.42%
31-Mar-98 QTR 1,125.09 -0.50% -0.50%
31-Dec-97 YTD 1,031.34 8.55% 8.55%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
24-Nov-97 INCEPT. 1,000.00 11.95% 20.70%

INCEPTION FACTOR: 0.6

STRATEGIC VALUE IS

IS
ACCOUNT IS AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,016.77 0.00%
31-May-98 1 MO 1,012.73 0.40% 0.40%
31-Mar-98 QTR 1,022.47 -0.56% -0.56%
31-Dec-97 YTD
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
12-Mar-98 INCEPT. 1,000.00 1.68% 5.62%

INCEPTION FACTOR: 0.3041

STRATEGIC GROWTH I
I
ACCOUNT I AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,185.29 0.00%
31-May-98 1 MO 1,116.90 6.12% 6.12%
31-Mar-98 QTR 1,152.34 2.86% 2.86%
31-Dec-97 YTD 1,013.87 16.91% 16.91%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
24-Nov-97 INCEPT. 1,000.00 18.53% 32.75%

INCEPTION FACTOR: 0.6

STRATEGIC GROWTH IS

IS
ACCOUNT IS AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,062.88 0.00%
31-May-98 1 MO 1,001.66 6.11% 6.11%
31-Mar-98 QTR 1,033.24 2.87% 2.87%
31-Dec-97 YTD
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
27-Feb-98 INCEPT. 1,000.00 6.29% 19.66%

INCEPTION FACTOR: 0.3397

EQUITY INCOME I

Y
ACCOUNT Y AVERAGE
YEARS VALUE CLASS ANNNUAL
30-Jun-98 BLANK 1,037.00 0.00%
31-May-98 1 MO 1,043.37 -0.61% -0.61%
31-Mar-98 QTR 1,073.68 -3.42% -3.42%
31-Dec-97 YTD 1,040.25 -0.31% -0.31%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
24-Nov-97 INCEPT. 1,000.00 3.70% 6.24%

INCEPTION FACTOR: 0.6

EQUITY INCOME IS

IS
ACCOUNT IS AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 988.39 0.00%
31-May-98 1 MO 994.67 -0.63% -0.63%
31-Mar-98 QTR 1,023.89 -3.47% -3.47%
31-Dec-97 YTD
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
12-Mar-98 INCEPT. 1,000.00 -1.16% -3.77%

INCEPTION FACTOR: 0.3041

SMALL COMPANY VALUE I

Y
ACCOUNT Y AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,012.75 0.00%
31-May-98 1 MO 1,033.63 -2.02% -2.02%
31-Mar-98 QTR 1,087.81 -6.90% -6.90%
31-Dec-97 YTD 1,024.00 -1.10% -1.10%
30-Jun-97 1
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
22-Dec-97 INCEPT. 1,000.00 1.28% 2.45%

INCEPTION FACTOR: 0.5233

SMALL CAP GROWTH I
Y
ACCOUNT Y AVERAGE
YEARS VALUE CLASS ANNNUAL

30-Jun-98 BLANK 1,381.01 0.00%
31-May-98 1 MO 1,369.43 0.85% 0.85%
31-Mar-98 QTR 1,458.90 -5.34% -5.34%
31-Dec-97 YTD 1,296.80 6.49% 6.49%
30-Jun-97 1 1,231.87 12.11% 12.11%
30-Jun-95 3
30-Jun-93 5
30-Jun-88 10
30-Dec-97 INCEPT. 1,000.00 38.10% 13.76%

INCEPTION FACTOR: 2.5041

EQUITY INDEX I

Fund Name Select Equity Index
07/01/1997 to 06/30/1998 29.17%
07/01/1995 to 06/30/1998 29.72%
07/01/1993 to 06/30/1998 22.26%
07/01/1988 to 06/30/1998 17.46%
Inception to 06/30/1998 17.02%

EQUITY INDEX IS

Fund Name Select Equity Index
07/01/1997 to 06/30/1998 29.17%
07/01/1995 to 06/30/1998 N/A
07/01/1993 to 06/30/1998 N/A
07/01/1988 to 06/30/1998 N/A
Inception to 06/30/1998 34.23%