<PAGE>
December 31, 1999
E v e r g r e e n S e l e c t
Equity Funds
Semiannual Report
[LOGO OF EVERGREEN FUNDS] [DALBAR MUTUAL FUND SERVICE AWARD]
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Table of Contents
Letter to Shareholders ..................................... 1
Evergreen Select Balanced Fund
Fund at a Glance ........................................... 2
Portfolio Manager Commentary ............................... 3
Evergreen Select Core Equity Fund
Fund at a Glance ........................................... 6
Portfolio Manager Commentary ............................... 7
Evergreen Select Diversified Value Fund
Fund at a Glance ........................................... 9
Portfolio Manager Commentary ............................... 10
Evergreen Select Large Cap Blend Fund
Fund at a Glance ........................................... 12
Portfolio Manager Commentary ............................... 13
Evergreen Select Secular Growth Fund
Fund at a Glance ........................................... 15
Portfolio Manager Commentary ............................... 16
Evergreen Select Small Cap Growth Fund
Fund at a Glance ........................................... 18
Portfolio Manager Commentary ............................... 19
Evergreen Select Small Company
Value Fund
Fund at a Glance ........................................... 22
Portfolio Manager Commentary ............................... 23
Evergreen Select Social Principles Fund
Fund at a Glance ........................................... 26
Portfolio Manager Commentary ............................... 27
Evergreen Select Strategic Growth Fund
Fund at a Glance ........................................... 29
Portfolio Manager Commentary ............................... 30
Evergreen Select Strategic Value Fund
Fund at a Glance ........................................... 32
Portfolio Manager Commentary ............................... 33
Financial Highlights
Evergreen Select Balanced Fund ............................. 35
Evergreen Select Core Equity Fund .......................... 36
Evergreen Select Diversified Value Fund .................... 37
Evergreen Select Large Cap Blend Fund ...................... 38
Evergreen Select Secular Growth Fund ....................... 39
Evergreen Select Small Cap Growth Fund . ................... 40
Evergreen Select Small Company Value Fund .................. 41
Evergreen Select Social Principles Fund .................... 42
Evergreen Select Strategic Growth Fund ..................... 43
Evergreen Select Strategic Value Fund ...................... 44
Schedule of Investments
Evergreen Select Balanced Fund ............................. 45
Evergreen Select Core Equity Fund .......................... 48
Evergreen Select Diversified Value Fund .................... 51
Evergreen Select Large Cap Blend Fund ...................... 54
Evergreen Select Secular Growth Fund ....................... 56
Evergreen Select Small Cap Growth Fund . ................... 58
Evergreen Select Small Company Value Fund .................. 60
Evergreen Select Social Principles Fund .................... 62
Evergreen Select Strategic Growth Fund ..................... 64
Evergreen Select Strategic Value Fund ...................... 66
Statements of Assets and Liabilities ....................... 68
Statements of Operations ................................... 70
Statements of Changes in Net Assets ........................ 72
Combined Notes to Financial
Statements ................................................. 76
Evergreen Funds
Evergreen Funds is one of the nation's fastest growing investment companies with
approximately $80 billion in asssets under management.
With over 80 mutual funds to choose among and acclaimed service and operations
capabilities, investors enjoy a broad range of quality investment products and
services designed to meet their needs.
The Evergreen Funds employ intensive, research-driven investment strategies
executed by over 90 research analysts and portfolio managers. The fund company
remains dedicated to meeting the needs of investors and their advisors in a
global economy. Look to Evergreen Funds to provide a distinctive level of
service and excellence in investment management.
This semiannual report must be preceded or accompanied by a prospectus of an
Evergreen fund contained herein. The prospectus contains more complete
information, including fees and expenses, and should be read carefully before
investing or sending money.
Mutual Funds: NOT FDIC INSURED May lose value . not bank guaranteed
Evergreen Distributor,Inc.
Evergreen Funds(SM) is a service mark of Evergreen Investment Services,Inc.
<PAGE>
Letter to Shareholders
----------------------
February 2000
[PHOTO]
William M. Ennis
[PHOTO]
Dennis Ferro
Dear Evergreen Shareholders,
We are pleased to provide the Evergreen Select Equity Funds semiannual report
for the period ended December 31, 1999.
Continued Strength in the Domestic Economy
Although the U.S. economy is in the ninth year of economic expansion, many
believe that valuation levels in some sectors of the stock market are just not
sustainable. The second half of 1999 was marked by the S&P 500 falling in the
first three months before rebounding nearly 15% in the last three months. While
equity investors have experienced a turbulent investment environment over the
last six months, concerns about rising interest rates, inflation and Y2K fears
in the opening months were stifled resulting in eventually every major market
index being driven higher during the fourth quarter of 1999.
The Federal Reserve Bank's "tightening bias" leads many to anticipate further
interest rate increases in order to stem even the slightest inflationary
pressure. Additional interest hikes would likely have a negative effect on stock
prices, which could restrain consumer spending; however, many investors are
waiting for just such a scenario to take place, so they can take advantage of
lower stock prices as a buying opportunity.
We believe that the economy is still fundamentally strong, and that inflation
will stay contained, producing only moderate upward pressure on interest rates.
We remain cautiously optimistic about the prospects for continued growth in the
markets.
Website Enhancements
Please visit our enhanced website, evergreen-funds.com, for more information
about Evergreen Funds. The site offers an array of helpful information including
1999 tax information, an investment education center, interactive calculators to
assist your investment planning and general information about Evergreen Funds.
We believe that sound investing is about taking steps to meet your long-term
financial needs and goals. We remind you to take advantage of your financial
advisor's expertise to develop and refine a financial plan that will enable you
to meet your objectives. Evergreen Funds offers a broad mix of stock, bond and
money market funds that should make it simple for you to choose the most
appropriate for your portfolio.
We would like to thank you for your continued investment in Evergreen Funds.
Sincerely,
/s/ William M. Ennis
William M. Ennis
President and CEO
Evergreen Investment Company, Inc.
/s/ Dennis H. Ferro
Dennis Ferro
Chief Investment Officer
First Union National Bank
Capital Management Group
1
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EVERGREEN
Select Balanced Fund
Fund at a Glance as of December 31, 1999
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PORTFOLIO PROFILE
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Philosophy
Evergreen Select Balanced Fund uses a systematic and disciplined investment
approach which provides exposure to both the equity and fixed income markets.
The basis of this approach is founded in the belief that stocks offer the
greatest long-term growth opportunities while bonds provide income and less risk
to principal.
Process
The Fund employs a blended approach to equity investing, utilizing companies
with both value- and growth-oriented characteristics. Within the fixed income
component, portfolio performance is enhanced while seeking to control risk by
managing duration, sector allocation and security selection.
Benchmarks
Standard & Poor's 500 Index (S&P 500)
Lehman Brothers Government/Corporate
Bond Index (LBGCBI)
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PERFORMANCE AND RETURNS1
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Portfolio Inception Date: 4/01/1991 Class I Class IS
Class Inception Date 1/22/1998 4/9/1998
Average Annual Returns
6 months 11.60% 11.48%
1 year 13.93% 13.69%
3 years 15.40% 15.33%
5 years 16.84% 16.79%
Since Portfolio Inception 13.02% 12.99%
6-month income dividends per share $0.25 $0.23
6-month capital gain distributions per share $0.53 $0.53
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Consumer Price
Select Balanced Index - US S & P 500 Lehman Brothers
3/31/91 1,000,000 1,000,000 1,000,000 1,000,000
12/31/91 1,143,581 1,021,481 1,139,198 1,130,782
12/31/92 1,237,351 1,051,111 1,225,975 1,216,511
12/31/93 1,369,502 1,080,000 1,349,546 1,350,712
12/31/94 1,339,851 1,108,889 1,367,374 1,303,321
12/31/95 1,698,966 1,137,037 1,881,278 1,554,111
12/31/96 1,897,974 1,174,815 2,313,128 1,599,216
12/31/97 2,300,631 1,194,815 3,084,864 1,755,270
12/31/98 2,560,978 1,214,074 3,966,332 1,921,815
12/31/99 2,918,285 1,247,407 4,801,394 1,880,249
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Balanced Fund Class I1, the S&P 500, the LBGCBI and the Consumer Price Index
(CPI).
The S&P 500 and the LBGCBI are unmanaged indices which do not include
transaction costs associated with buying and selling securities nor any
management fees. The CPI is a commonly used measure of inflation and does not
represent an investment return. It is not possible to invest directly in an
index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Class I prior to its inception is based on the
performance of the Class Y Shares of Evergreen Balanced Fund II. Historical
performance shown for Class IS reflects that of Class Y Shares of Evergreen
Balanced Fund II, through 1/22/1998, the inception of Class I Shares.
Performance from 1/23/1998 through the inception of Class IS Shares reflects
that of Class I Shares. Performance prior to inception of Class IS Shares does
not include this class' 0.25% 12b-1 fees. Class I Shares do not pay a 12b-1 fee.
If fees were reflected, returns would have been lower.
U.S. Government guarantee applies only to the underlying securities of the
Fund's portfolio and not the Fund's shares.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
2
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EVERGREEN
Select Balanced Fund
Portfolio Manager Commentary
Portfolio Management Team
[PHOTO] [PHOTO]
W. Shannon Reid, David M. Chow,
CFA CFA
[PHOTO]
Rollin C. Williams,
CFA
Performance
For the six-month period ended December 31, 1999, the Fund's, Class I Shares,
posted an 11.60% return. This compared favorably to returns of 0.13% and 7.69%,
respectively, for the Fund's benchmarks, the Lehman Brothers
Government/Corporate Bond Index and the S&P 500, for the same period. The Fund's
solid performance in the fourth quarter and throughout the year can be
attributed to a heavy weighting and strong stock selection within the
portfolio's technology component.
Portfolio
Characteristics
------------------
(as of 12/31/1999)
Total Net Assets $646,198,503
Number of Holdings 117
P/E Ratio 46.0x
Beta 1.25
Environment
The past six months represented a markedly different period for equity and fixed
income investors. Despite tame inflation news throughout the six months, bond
prices fell as interest rates trended higher. Rising interest rates were
prompted by the market's expectation of tighter monetary policy in response to
stronger-than-expected GDP growth. From a sector standpoint, Treasury
securities struggled during the period and underperformed the "spread" sectors,
as investors flocked to the generous yields of corporates and mortgages.
The stock market, conversely, witnessed a roller coaster ride during the past
six months, rebounding from a difficult third quarter and culminating with an
amazing performance during the final three months. In fact, equity investors
along the entire capitalization spectrum enjoyed this spectacular rebound and
strong returns in the final half of the period. The S&P 500 posted a strong
total return and growth stocks again won the value-versus-growth battle, as the
large cap Russell 1000 Growth Index outperformed its value counterpart.
3
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EVERGREEN
Select Balanced Fund
Portfolio Manager Commentary
Strategy
1999 marked the worst year for bonds since 1994, and the Fund's exposure to this
segment of the financial markets penalized total return. Within the portfolio's
fixed income component, returns were negatively effected by a "barbelled"
portfolio that was maintained during the fourth quarter (a "barbelled" portfolio
structure is distinguished by securities primarily on both ends of the yield
curve rather than in the middle.) This strategy--which paid off handsomely in
1997 and 1998--had a negative impact on performance during the last six months
of 1999.
Conversely, the Fund's equity exposure had a very favorable impact on
performance. The equity management team continues to employ a combination of
quantitative and qualitative investment analysis that seeks to identify
companies that they believe will exhibit superior and sustainable earnings
growth. This methodology has resulted in a portfolio currently skewed towards
technology and consumer cyclicals, and underweighted in traditional growth-
oriented sectors such as consumer staples and health care.
As of December 31, 1999, technology represented the Fund's largest sector.
Within the sector, we continue to emphasize three trends: (1) technological
advances in communications networks, (2) the growth in demand for enterprise
information storage solutions and (3) business-to-business electronic commerce.
Consumer cyclicals represented the Fund's second largest sector weighting at 21%
versus 18% for the benchmark. Healthy consumer spending patterns, innovative
business models, and strong management teams were the factors shared by our top
performers which included Yahoo (up 151% for the period), America Online (up
38%), Home Depot (up 60%) and Wal-Mart (up 43%). We have always included Yahoo
and America Online in the media subsector of consumer cyclicals as opposed to
technology, a definition we believe was validated by the recently announced
AOL/Time Warner merger.
Top 5 Industries--Equity
-------------------------------------------
(as a percentage of 12/31/1999 net assets)
Information Services & Technology 19.3%
Healthcare Products & Services 6.9%
Communication Systems & Services 6.2%
Retailing & Wholesale 5.5%
Telecommunication Services & Equipment 2.9%
Top 5 Industries--Bonds
-------------------------------------------
(as a percentage of 12/31/1999 net assets)
Treasury Bonds & Notes 27.7%
Finance & Insurance 4.3%
Banks 2.4%
Communication Systems & Services 1.4%
Oil/Energy 1.3%
Top 10 Equity Holdings
-------------------------------------------
(as a percentage of 12/31/1999 net assets)
Cisco Systems, Inc. 3.3%
Microsoft Corp. 3.2%
Yahoo!, Inc. 2.3%
General Electric Co. 1.9%
Lucent Technologies, Inc. 1.5%
Home Depot, Inc. 1.4%
Johnson & Johnson 1.4%
America Online, Inc. 1.4%
EMC Corp. 1.3%
Procter & Gamble Co. 1.3%
4
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EVERGREEN
Select Balanced Fund
Portfolio Manager Commentary
Top 5 Bond Holdings
------------------------------------------
(as a percentage of 12/31/1999 net assets)
Coupon Maturity
U.S. Treasury Notes 7.75% 2/15/2001 4.5%
U.S. Treasury Notes 6.88% 5/15/2006 2.5%
U.S. Treasury Notes 7.25% 5/15/2004 2.3%
U.S. Treasury Notes 5.50% 3/31/2000 2.3%
U.S. Treasury Bonds 7.88% 2/15/2021 2.0%
Outlook
Looking ahead, the policy statement issued by the Federal Reserve Board at the
conclusion of its December Federal Open Market Committee meeting and the current
forward momentum of the economy suggest interest rates are heading higher. In
anticipation of higher rates, within our fixed income holdings we expect to
maintain a shorter duration stance in early 2000.
From an equity perspective, though the past six months have been an
extraordinary market environment, we urge investors not to expect returns of
this magnitude to continue indefinitely. For the near term, we believe stock
valuations in certain areas are overextended; nevertheless, we remain positive.
Growth stock investing is ultimately about identifying companies that will
produce superior and sustainable earnings growth. Given the extraordinary
events taking place in the fields of technology, economics and global politics,
we believe these opportunities are more abundant than ever.
5
<PAGE>
EVERGREEN
Select Core Equity Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
Evergreen Select Core Equity Fund utilizes a diversified style of equity
management which capitalizes on opportunities in both value- and growth-oriented
stocks. In serving the investment needs of individual investors, the Fund
remains sensitive to tax implications.
Process
The Fund uses a bottom-up stock selection process, focusing on security
fundamentals rather than broad economic forecasts. The Fund is managed using a
team approach; investment managers locate attractive holdings using a unique
blend of quantitative and traditional fundamental analysis skills.
Benchmark
Standard & Poor's 500 Index (S&P 500)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 12/31/1981 Class I Class IS
Class Inception Date 11/24/1997 2/4/1998
Average Annual Returns
6 months 8.02% 7.89%
1 year 17.64% 17.34%
3 years 19.18% 18.90%
5 years 23.83% 23.52%
10 years 14.37% 14.09%
Since Portfolio Inception 15.80% 15.51%
6-month income dividends per share $ 0.20 $ 0.10
6-month capital gain distributions per share $ 9.10 $ 9.10
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Select Core Equity Consumer Price Index - US S&P 500 Composite
12/31/89 1,000,000 1,000,000 1,000,000
12/31/90 976,256 1,061,063 968,948
12/31/91 1,250,825 1,093,577 1,264,172
12/31/92 1,322,176 1,125,297 1,360,469
12/31/93 1,419,470 1,156,225 1,497,597
12/31/94 1,316,091 1,187,153 1,517,380
12/31/95 1,795,355 1,217,288 2,087,661
12/31/96 2,263,388 1,257,732 2,566,887
12/31/97 2,883,973 1,279,144 3,423,285
12/31/98 3,257,596 1,299,762 4,401,453
12/31/99 3,831,966 1,335,448 5,328,124
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Core Equity Fund, Class I1, the S&P 500 and the Consumer Price Index (CPI).
The S&P 500 is an unmanaged index which does not include transaction costs
associated with buying and selling securities nor any management fees. The CPI
is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Class IS from 11/24/1997 to its inception is
based on the performance of Class I and has not been adjusted to reflect the
effect of the 0.25% 12b-1 fee applicable to Class IS. Class I pays no 12b-1 fee.
If these fees had been reflected, returns would have been lower. Prior to
11/24/1997, the returns for Classes I and IS are based on the Fund's predecessor
common trust fund's (CTF) performance, adjusted for estimated mutual fund
expenses. The CTF was not registered under the 1940 Act and was not subject to
certain investment restrictions. If the CTF had been registered, its performance
might have been adversely affected.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
6
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EVERGREEN
Select Core Equity Fund
Portfolio Manager Commentary
Portfolio Management Team
The Fund is managed by Mark C. Sipe, CFA and Hanspeter Giger, CFA who have over
33 years of combined investment experience.
[PHOTO] [PHOTO]
Mark C. Sipe Hanspeter Giger
Performance
The Fund's Class I Shares, performed well for the six-month period ended
December 31, 1999, returning 8.02% versus the S&P 500's 7.69% return for the
same period. This favorable performance did not come easily in a market still
led by the very largest capitalization stocks, and further, dominated by one
sector--technology. The results were equally gratifying in that they followed a
restructuring of the Fund aimed at better representing the largest stocks in the
market in proportion to their weightings in the S&P 500 index.
Portfolio
Characteristics
------------------
(as of 12/31/1999)
Total Net Assets $2,718,664,136
Number of Holdings 126
P/E Ratio 29.0x
Beta 0.93
Environment
The stock market continued to provide plenty of excitement in the second half of
calendar 1999. The first three months of the period actually saw the S&P 500
close down over 6%, with all market sectors, except technology down on a price
basis. However, the final three months more than made up for that poor interim
showing. As evidence of the ongoing relative strength of size (i.e.
capitalization) in the market, when taken as a group, the largest 50 stocks in
the S&P 500 index outperformed the 50 smallest by an amazing 51 percentage
points.
The largest of the large capitalization stocks continue to provide the bulk of
the market's returns, but an added narrowness took hold in the form of
spectacular performance by the technology sector, especially in the fourth
quarter of the year. Emblematic of that performance was the return of the
technology-heavy NASDAQ 100 Index, which was up almost 54% in the quarter, and
up over 60% for the six months. Within the S&P 500 specifically, technology was
far and away the strongest sector, up over 36% during the quarter, and up over
40% for the full period. That compares with the performance of the next
strongest sector, consumer cyclicals, which appreciated over 20% in the quarter,
but only about 8% for the second half of 1999.
7
<PAGE>
EVERGREEN
Select Core Equity Fund
Portfolio Manager Commentary
The returns of the remaining S&P sectors were uniformly below the performance of
the index during the final three months of 1999, and almost uniformly so during
the full period.
Strategy
Contributions to the Fund's performance during the reporting period came
primarily from overweighted positions in capital goods and health care. In the
case of capital goods, the bulk of the returns were generated by a single
holding, General Electric, which was up over 38% for the six months. Within
health care, a sector which performed reasonably poorly in the market during the
time frame analyzed, nevertheless contributed to Fund performance through
superior stock selection. A number of the Fund's holdings, namely Amgen,
Lincare Holdings, Teva Pharmaceuticals, Tenet Healthcare, and Warner Lambert
were up well in excess of the S&P's returns. As would be expected, an
overweighted position in the Fund's technology holdings was the proper stance
during the period. Technology holdings that contributed most positively
included Oracle, Nokia, Comverse Technology, Applied Materials, Network
Associates, and Cisco, all of which were up in excess of 65%. Offsetting the
full benefit of the Fund's sector weighting, however, was poor performance by
the Fund's fifth largest position, International Business Machines.
Top 5 Industries
------------------------------------------
(as a percentage of 12/31/1999 net assets)
Information Services & Technology 23.1%
Healthcare Products & Services 10.3%
Communication Systems & Services 8.8%
Finance & Insurance 7.5%
Retailing & Wholesale 7.2%
Top 10 Holdings
----------------------------------------
(as a percentage 12/31/1999 net assets)
General Electric Co. 6.8%
Microsoft Corp. 6.6%
Cisco Systems, Inc. 4.8%
Intel Corp. 2.9%
International Business Machines Corp. 2.8%
MCI WorldCom, Inc. 2.3%
Coca Cola Co. 2.2%
Wal-Mart Stores, Inc. 2.1%
Exxon Mobil Corp. 2.1%
Bristol-Myers Squibb Co. 1.8%
Outlook
The outlook for the stock market going forward will continue to be shaped by
expectations surrounding the direction of interest rates, corporate earnings,
and trends in domestic and international economies. At present, inflation and
economic growth worldwide continue to provide a positive backdrop for stocks.
However, an upward move in interest rates, which has not been met by a slowing
of index gains, may warrant some caution in the near term. Within the Fund,
investments will continue to be selected focusing on a combination of strong
fundamental outlooks and attractive relative valuations.
8
<PAGE>
EVERGREEN
Select Diversified Value Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
Evergreen Select Diversified Value Fund is a fund with an emphasis on
traditional value, utilizing fundamental analysis to determine if a stock is
selling at a reasonable valuation level. The Fund seeks to capture the best
opportunities in a value universe by emphasizing securities with perceived
intrinsic value above current market levels due to temporary or anticipated
problems.
Process
Primarily, the Fund invests in undervalued companies using a "bottom-up"
approach that concentrates on analyzing security fundamentals rather than broad
economic forecasts. The Diversified Value team strives to produce a portfolio
that best controls risk and balances a risk/reward relationship.
Benchmark
Standard & Poor's 500 Index (S&P 500)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 1/03/1991 Class I Class IS
Class Inception Date 1/22/1998 3/31/1998
Average Annual Returns
6 months 7.27% 7.11%
1 year 17.13% 16.79%
3 years 17.06% 16.39%
5 years 20.38% 19.97%
Since Portfolio Inception 16.46% 16.23%
6-month income dividends per share $0.09 $0.06
6-month capital gain distributions per share $1.08 $1.08
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Evergreen Consumer Price
Select Diversified Index - US S&P 500
1/3/91 1,000,000 1,000,000 1,000,000
12/31/91 1,283,236 1,030,600 1,304,700
12/31/92 1,389,775 1,060,500 1,404,100
12/31/93 1,524,936 1,089,700 1,545,600
12/31/94 1,556,105 1,118,800 1,566,000
12/31/95 2,057,218 1,147,200 2,154,600
12/31/96 2,452,576 1,185,400 2,649,100
12/31/97 3,090,385 1,205,500 3,533,000
12/31/98 3,359,805 1,225,000 4,542,500
12/31/99 3,934,708 1,258,600 5,498,900
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Diversified Value Fund Class I1, the S&P 500 and the Consumer Price Index (CPI).
The S&P 500 is an unmanaged index which does not include transaction costs
associated with buying and selling securities nor any management fees. The CPI
is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Class I prior to its inception is based on the
performance of the Class Y Shares of Evergreen Value Fund. Historical
performance shown for Class IS reflects that of Class Y Shares of Evergreen
Value Fund, through 1/22/1998, the inception of Class I Shares. Performance
from 1/23/1998 through the inception of Class IS Shares reflects that of Class I
Shares. Performance prior to inception of Class IS Shares does not include this
class' 0.25% 12b-1 fees. Class I Shares do not pay a 12b-1 fee. If fees were
reflected, returns would have been lower.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
9
<PAGE>
EVERGREEN
Select Diversified Value Fund
Portfolio Manager Commentary
Portfolio Management
Eric M. Teal is manager of the Evergreen Select Diversified Value Fund. He
employs rigorous fundamental analysis combined with a disciplined quantitative
approach to seek superior results and adherence to risk/reward objectives.
[PHOTO]
Eric M. Teal
Performance
For the six-month period ended December 31, 1999, the Fund's Class I Shares
7.27% return narrowly trailed that of its benchmark, the S&P 500 Index, which
returned 7.69% for the same period.
Portfolio
Characteristics
--------------------
(as of 12/31/1999)
Total Net Assets $544,552,587
Number of Holdings 100
P/E Ratio 29.0x
Beta 1.19
Environment
The first half of the Fund's fiscal year was broken into two distinctly
different periods, as the market fell sharply during the first three months,
then rebounded dramatically in the final quarter of 1999. Negative returns in
the opening months were primarily a result of well-publicized Y2K risks, higher
crude oil prices and rising interest rates that all combined to concern
investors.
In the second half of the period, the equity markets continued their familiar
trend from the past few years, amazing investors by climbing ever higher.
Against this backdrop, nearly every major market index posted solid gains, and
investors shrugged off their earlier fears. The negative factors that threatened
the market's continued growth were offset by what the expert's have dubbed
"Economic Nirvana"--strong economic growth, benign inflation and low
unemployment. These ideal conditions along with strong earnings reports and
enthusiasm for equities prompted investors to shrug off any negative
information, and stock prices soared.
Top 5 Industries
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Information Services & Technology 15.5%
Healthcare Products & Services 9.1%
Finance & Insurance 8.7%
Retailing & Wholesale 8.2%
Electrical Equipment & Services 7.5%
10
<PAGE>
EVERGREEN
Select Diversified Value Fund
Portfolio Manager Commentary
Strategy
During the six months, Fund results steadily increased in a volatile and narrow
market. Our multi-cap core strategy continues to emphasize all sectors with no
more than 75% of our stocks concentrated in large capitalization companies.
Identifying companies with a reasonable valuation and exhibiting some degree of
earnings acceleration is our primary objective.
Performance during the six-month period slightly trailed the narrow, technology-
laden S&P 500 Index. Positive stock selection contributed to the improving
results. Many of our top holdings have been in the wireless handset industry,
including Motorola, which gained over 60%, and Nokia, up over 100%.
Semiconductor related stocks continued to outperform due to pricing
improvements; Applied Materials rose over 65%. Biotechnology stocks also showed
strong gains during the period with Amgen up almost 100%. Our underperformers
were traditional defensive value stocks which included Philip Morris.
Top 10 Holdings
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Motorola, Inc. 3.8%
Microsoft Corp. 3.4%
General Electric Co. 3.2%
Wal-Mart Stores, Inc. 3.1%
American International Group, Inc. 2.4%
Lucent Technologies, Inc. 2.0%
Ford Motor Co. 1.8%
Lowe's Companies, Inc. 1.8%
Cisco Systems, Inc. 1.8%
Pfizer, Inc. 1.6%
The Fund remains committed to closely monitoring risk and continuing to focus on
stock selection rather than sector risks. Recent additions--especially in the
technology sector--have focused on earnings growth and valuation rather than
simply momentum.
Outlook
1999 was a tremendous year for the equity markets and technology stocks in
particular, with the technology-heavy NASDAQ gaining over 85%. The economy
continued to be very robust and earnings growth continued to accelerate upward.
We expect the Fed to make some aggressive moves to slow growth during early
2000. We believe that a higher interest rate environment sharpens our focus on
identifying companies with sustainable and quality driven earnings. At this
point our favorite sectors are still technology, along with basic materials and
consumer cyclicals. We also have not given up on utilities, which currently
enjoy historically high yields. Additionally, the financial sector is beginning
to look attractive, but we do not want to be too premature in overweighting the
group.
11
<PAGE>
EVERGREEN
Select Large Cap Blend Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
Evergreen Select Large Cap Blend Fund invests in large and mid-sized U.S.
companies, blending those that display both value and growth-oriented
characteristics. This philosophy holds that value and growth stocks tend to be
counter-cyclical, outperforming the broad market at different times.
Diversification between the two approaches tends to provide less volatile
investment results over time.
Process
Research and stock selection focus on companies of sound financial quality which
have strong management teams and maintain competitive leadership positions
within their respective industries. These companies are identified using a
fundamental, bottom-up stock selection process which is research-intensive.
Benchmark
Russell 1000 Growth Index
(Russell 1000 Growth)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 12/31/1993 Class I Class IS
Class Inception Date 11/24/1997 3/12/1998
Average Annual Returns
6 months 3.53% 3.41%
1 year 9.74% 9.45%
3 years 16.98% 16.71%
5 years 24.20% 23.90%
Since Portfolio Inception 18.74% 18.45%
6-month income dividends per share $0.13 $0.08
6-month capital gain distributions per share $6.51 $6.51
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Consumer Price Russell 1000
Select Large Cap Index - US Growth
12/31/93 1,000,000 1,000,000 1,000,000
12/31/94 948,384 1,026,749 1,026,561
12/31/95 1,324,983 1,052,812 1,408,288
12/31/96 1,750,686 1,087,791 1,733,917
12/31/97 2,283,227 1,106,310 2,262,535
12/31/98 2,553,381 1,124,143 3,138,235
12/31/99 2,802,807 1,155,007 4,178,330
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Large Cap Blend Fund Class I1, the Russell 1000 Growth and the Consumer Price
Index (CPI).
The Russell 1000 Growth is an unmanaged index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may
vary based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Class IS from 11/24/1997 to its inception is
based on the performance of Class I and has not been adjusted to reflect the
effect of the 0.25% 12b-1 fee applicable to Class IS. Class I pays no 12b-1
fee. If these fees had been reflected, returns would have been lower. Prior to
11/24/1997, the returns for Classes I and IS are based on the Fund's predecessor
common trust fund's (CTF) performance, adjusted for estimated mutual fund
expenses. The CTF was not registered under the 1940 Act and was not subject to
certain investment restrictions. If the CTF had been registered, its
performance might have been adversely affected.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
12
<PAGE>
EVERGREEN
Select Large Cap Blend Fund
Portfolio Manager Commentary
Portfolio Management Team
The Evergreen Select Large Cap Blend Fund is managed by Timothy M. Stevenson and
Eric M. Teal. The team-oriented approach incorporates multiple perspectives to
attempt to identify the most attractive opportunities in the market and ensures
adherence to the style-specific objectives.
[PHOTO] [PHOTO]
Timothy M. Eric M. Teal
Stevenson, CFA
Performance
For the six-month period ended December 31, 1999, the Fund's Class I Shares
returned 3.53% trailing that of its benchmark, the Russell 1000 Growth Index,
which returned 20.56% for the same period. The Fund lagged its benchmark
primarily due to under-exposure to semiconductors and electronics equipment
makers within the technology sector as well as poor returns among its capital
goods and consumer cyclical holdings.
Portfolio
Characteristics
------------------
(as of 12/31/1999)
Total Net Assets $344,647,844
Number of Holdings 63
P/E Ratio 27.4x
Beta 1.09
Environment
The first half of the Fund's fiscal year was broken into two distinctly
different periods, as the market fell sharply during the first three months,
then rebounded dramatically in the final quarter of 1999. Negative returns in
the opening months were primarily a result of well-publicized Y2K risks, higher
crude oil prices and rising interest rates that all combined to concern
investors.
In the second half of the fiscal period, the equity markets continued their
familiar trend from the past few years, amazing investors by climbing ever
higher. Against this backdrop, nearly every major market index posted solid
gains, and investors shrugged off earlier fears. The negative factors that
threatened the market's continued growth were offset by what the expert's have
dubbed "Economic Nirvana"--strong economic growth, benign inflation and low
unemployment. These ideal conditions along with strong earnings reports and
enthusiasm for equities--the overwhelming asset class of choice--prompted
investors to shrug off any negative information, and stock prices soared.
Top 5 Industries
------------------------------------------
(as a percentage of 12/31/1999 net assets)
Information Services & Technology 21.2%
Communication Systems & Services 10.7%
Healthcare Products & Services 10.4%
Finance & Insurance 8.9%
Banks 5.9%
13
<PAGE>
EVERGREEN
Select Large Cap Blend Fund
Portfolio Manager Commentary
Strategy
During the six months, Fund results rose but trailed the S&P 500 Index due to
specific stock selection. Relative performance was lost due to significant
earnings disappointments from Waste Management and Bank One. A large position
in Bank of America also subtracted from total return as rising interest rates
penalized most financial services companies. Within the portfolio's financial
weighting, we reduced exposure to insurance companies. Lastly, speculation
surrounding accounting issues at Tyco resulted in a pull back on one of Wall
Street's favorite stocks.
Offsetting some negative factors were strong fourth-quarter performances by the
portfolio's technology and communication services holdings. Underlying a
modestly overweighted technology position, Microsoft, EMC Corp. and Cisco
Systems--three of the Fund's top four holdings--jumped 28.9%, 53.1% and 56.2%,
respectively, during the final three months. The portfolio's weighting of
communication services stocks was increased in the latter part of the period due
to positive underlying fundamentals that this sector currently enjoys. MCI
Worldcom, GTE Corp and Motorola represent three holdings within this high-growth
sector.
Our strongest performers during the six months were our significant picks in
technology with Cisco and EMC Corp rising over 60% and 80%, respectively.
Alcoa, our top holding in the basic metal products and services sector rose over
31%.
Top 10 Holdings
------------------------------------------
(as a percentage of 12/31/1999 net assets)
Microsoft Corp. 5.4%
General Electric Co. 5.1%
EMC Corp. 4.6%
Cisco Systems, Inc. 4.5%
MCI WorldCom, Inc. 3.9%
Exxon Mobil Corp. 3.5%
Dayton Hudson Corp. 3.1%
Citigroup, Inc. 3.1%
GTE Corp. 2.9%
Warner-Lambert Co. 2.6%
Outlook
1999 was a tremendous year for the equity markets and technology stocks in
particular, with the technology-heavy NASDAQ gaining over 85%. The economy has
continued to be very robust and earnings growth has continued to accelerate
upward. We expect the Federal Reserve to make some aggressive moves to slow
growth during early 2000. We believe that a higher interest rate environment
increases our focus on identifying those companies with sustainable and quality
driven earnings. At this point our favorite sectors are still technology, along
with basic materials and consumer cyclicals. We also have not given up on
utilities, which enjoy historically high yields. Additionally, the financial
sector is beginning to look attractive, but we do not want to be too premature
in overweighting the group.
14
<PAGE>
EVERGREEN
Select Secular Growth Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
Evergreen Select Secular Growth Fund seeks to identify companies that are
positioned to capitalize upon favorable secular trends within the U.S. economy.
We accomplish this by using highly focused fundamental research along with
quantitative tools to select high quality, large cap growth companies that
exhibit consistent and accelerating earnings growth.
Process
Stephen Dalton and his team of dedicated analysts utilize a disciplined
investment process in order to construct a portfolio of large cap, high quality,
growth-oriented companies:
. Ideas generated by the Secular Growth Team analysts
. Daily meetings to discuss buy/sell candidates, establish priorities
and discuss the market
. Analyst recommendations are made to the team; team leaders make final
decisions
. Quantitative tools are used to verify or challenge recommendations
Benchmark
Standard & Poor's 500 Index (S&P 500)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 12/31/1994 Class I Class IS
Class Inception Date 2/26/1999 2/26/1999
Average Annual Returns
6 months 50.01% 49.77%
1 year 66.30% 65.84%
3 years 45.04% 44.67%
5 years 39.16% 38.80%
Since Portfolio Inception 39.19% 38.84%
6-month capital gain distributions per share $3.27 $3.27
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Select Secular Growth Consumer Price Index - US S & P 500
12/31/94 1,000,000 1,000,000 1,000,000
6/30/95 1,197,451 1,018,704 1,202,128
12/31/95 1,366,569 1,025,384 1,375,833
6/30/96 1,611,157 1,046,760 1,514,679
12/31/96 1,709,825 1,059,452 1,691,658
6/30/97 1,947,789 1,070,808 2,040,258
12/31/97 2,215,359 1,077,488 2,256,050
6/30/98 2,725,200 1,088,844 2,655,629
12/31/98 3,137,643 1,094,856 2,900,693
6/30/99 3,479,044 1,110,220 3,260,309
12/31/99 5,219,120 1,124,916 3,511,398
Comparison of change in value of a $1,000,000 investment in Evergreen Select
Secular Growth Fund, Class I1, S&P 500 and the Consumer Price Index (CPI).
The S&P 500 is an unmanaged index which does not include transaction costs
associated with buying and selling securities nor any management fees. The CPI
is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may
vary based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Classes I and IS prior to 7/12/1999 is based on
the Fund's predecessor common trust fund's (CTF) performance, adjusted for
estimated mutual fund expenses. The CTF was not registered under the Investment
Company Act of 1940 and was not subject to certain investment restrictions. If
the CTF had been registered, its performance might have been adversely affected.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
15
<PAGE>
EVERGREEN
Select Secular Growth Fund
Portfolio Manager Commentary
Portfolio Management
Stephen M. Dalton, CFA
Stephen Dalton is the portfolio manager of the Evergreen Select Secular Growth
Fund and has 15 years of investment management and research experience, managing
growth and balanced portfolios. In addition, he has covered the health care,
technology, retail, media and entertainment industries. Prior to joining First
Capital, Steve was a Senior Portfolio Manager at CoreStates Investment Advisory,
which was acquired by First Union in 1998. Mr. Dalton is supported by a team of
three dedicated analysts with a combined 59 years of investment experience.
Performance
For the six-month period ended December 31, 1999, the Fund's Class I Shares
posted a 50.01% return. The Fund's performance significantly outpaced its
benchmark, the S&P 500, which returned 7.69% for the same period.
Portfolio
Characteristics
--------------------
(as of 12/31/1999)
Total Net Assets $945,307,303
Number of Holdings 57
P/E Ratio 67.5x
Beta 1.29
Environment
The first half of the Fund's six-month period ended 12/31/1999 was broken into
two distinctly different periods: the first three months in which the stock
market posted negative returns, and the amazing year-end ascent. The one
constant through this roller-coaster ride was the strong relative performance by
growth stocks.
Underlying this growth-dominated marketplace, was the extraordinary relative
performance of the technology sector. In the final three months alone, the
technology sector soared nearly 37%. Coupled with rising interest rates that
penalized value-oriented equity strategies, the technology-deficient value
indices trailed their growth counterparts throughout the period.
Top 5 Industries
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Information Services & Technology 30.5%
Retailing & Wholesale 16.0%
Communication Systems & Services 14.2%
Finance & Insurance 9.4%
Healthcare Products & Services 6.8%
16
<PAGE>
EVERGREEN
Select Secular Growth Fund
Portfolio Manager Commentary
Strategy
The Fund emphasizes large capitalization U.S. companies that have generated
consistent above-average historical and prospective profitability, as well as
issues which we believe will post accelerating earnings growth. The investment
process is based on an intensive top-down strategy that identifies secular
themes within the U.S. economy, and seeks to exploit them by identifying
companies with specific growth characteristics.
Within the technology sector (currently our largest sector weighting, though
roughly benchmark weighted) particular emphasis was placed on issues providing
internet infrastructure, both hardware and software support, security, high
speed access and bandwidth. As technological innovation spurs productivity and
continues to drive the U.S. economy, we feel these particular areas are poised
to exploit this powerful secular trend. In fact, strong returns by companies in
these areas had an extremely positive effect on total return, allowing the Fund
to outpace its benchmark and peer group average significantly during the past
six months.
Exceptional performance can also be attributed to a strong fourth quarter
rebound in the Fund's overweighted position in communication services--another
area the Fund enjoys very favorable underlying secular fundamentals. This
sector weighting was bolstered in September, with two of the portfolio's
holdings in this group--Global Crossing and Metromedia Fiber Networks--soaring
92% and 95%, respectively, in the final three months alone.
Exceptional six-month returns by newly added tech holdings in telecom equipment
(JDS Uniphase, up 289%, and Broadcom, up 88%), and internet infrastructure
software (Broadvision up 592%, Veritas, 352%, Verisign, 342%, and Sun
Microsystems, 125%), played a critical role in the Fund's superior performance.
New positions purchased during the quarter also contributed to strong
performance. These include Exodus, the premier web hosting service company, up
101% from our mid-October entry to quarter-end and Nokia, up 92% since early
October inclusion in the Fund. Our technology holdings represented the largest
sector weighting--46% of the portfolio compared to 43% of the benchmark--and
rose a dramatic 99% in the fourth quarter alone.
Though we remain extremely "bullish" on the technology sector over the long
term, we strategically took profits from some of our outstanding technology
performers in late December, and increased exposure to retail and financial
stocks due to both secular and seasonal factors in the first half of 2000.
Top 10 Holdings
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Home Depot, Inc. 3.2%
American Express Co. 3.1%
Wal-Mart Stores, Inc. 3.1%
Costco Wholesale Corp. 3.1%
Dayton Hudson Corp. 2.9%
VeriSign, Inc. 2.8%
EMC Corp. 2.7%
Cisco Systems, Inc. 2.5%
Veritas Software Corp. 2.5%
JDS Uniphase Corp. 2.4%
Outlook
Looking ahead, we anticipate continued quiescent inflation. Nevertheless, as we
anticipate persistent strong performance from the internet infrastructure and
business-to-business e-commerce arenas in technology, we remain bullish on the
Fund's positioning. Areas in which we remain especially bullish are telecom
equipment and services, internet infrastructure software, web hosting services,
and pervasive computing (wireless internet access). We also maintain a
favorable outlook for the financial sector, an area exploiting both the
demographic influence of higher levels of public investing and the globalization
of corporate financial services.
17
<PAGE>
EVERGREEN
Select Small Cap Growth Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
The Fund seeks to provide shareholders with long-term growth of capital by
investing in small company stocks. We believe that the risk associated with
smaller company stocks can be managed effectively by diversification and careful
attention to valuation.
Process
The Fund manager uses a fundamental, bottom-up stock selection process, which is
research-intensive. The Fund generally invests in stocks of companies which have
market capitalization of $1 billion or less and above average long-term growth
rates. Our research process identifies buying opportunities in small company
stocks of high-quality companies with a competitive advantage, growth-oriented,
and reasonably valued.
Benchmark
Russell 2000 Growth Index
(Russell 2000 Growth)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 12/28/1995 Class I
Class Inception Date 12/28/1995
Average Annual Returns
6 months 46.15%
1 year 58.84%
3 years 20.43%
Since Portfolio Inception 20.42%
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Select Small Cap CPI Russell 2000
12/31/95 1,000,000 1,000,000 1,000,000
6/30/96 1,148,043 1,020,847 1,119,229
12/31/96 1,204,639 1,033,225 1,112,624
6/30/97 1,231,918 1,044,300 1,170,760
12/31/97 1,296,860 1,050,814 1,256,739
6/30/98 1,381,194 1,061,889 1,325,311
12/31/98 1,324,461 1,067,752 1,272,237
6/30/99 1,439,564 1,082,736 1,435,321
12/31/99 2,103,624 1,097,068 1,820,534
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Small Cap Growth Fund Class I1, the Russell 2000 Growth and the Consumer Price
Index (CPI).
The Russell 2000 Growth is an unmanaged index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
Smaller capitalization stock investing may offer the potential for greater long
term results; however, it is also generally associated with greater volatility
due to the higher risk of failure.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. Index returns do not reflect expenses,
which have been deducted from the Fund's return.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
18
<PAGE>
EVERGREEN
Select Small Cap Growth Fund
Portfolio Manager Commentary
Portfolio Management
Evergreen Select Small Cap Growth Fund is managed by Thomas L. Holman. Mr.
Holman is a member of the Small Cap Growth Team at Evergreen Investment
Management Company, where he manages the Fund and separately managed, small-cap
growth accounts. His research responsibilities are focused on telecommunication
service companies. Prior to joining Evergreen in 1997, Mr. Holman was a
portfolio manager and securities analyst at Invista Capital Management. He
developed quantitative models and had co-management responsibility for several
small- and mid-cap portfolios. As an analyst, he was a generalist, covering a
wide variety of industries, including technology, telecommunications equipment,
media services, basic industry, consumer staples and retail. Mr. Holman
received both his B.S. and M.B.A degrees from Iowa State University.
[PHOTO]
Thomas L. Holman
Performance
Evergreen Select Small Cap Growth Fund performed exceptionally well during the
six-month period ended December 31, 1999. The Fund's Class I shares had a total
return of 46.15% during the six months, compared to a 26.83% return for the
benchmark Russell 2000 Growth Index.
The Fund's heavy emphasis on the technology sector, and good stock selection
within the sector, drove performance. Software companies, especially those
involved in commerce on the internet, and hardware companies, including
manufacturers of semi-conductors and components, all contributed to the Fund's
excellent returns.
Portfolio
Characteristics
--------------------
(as of 12/31/1999)
Total Net Assets $111,493,601
Number of Holdings 70
P/E Ratio 36.4x
Beta 1.31
Environment
The most significant development during the six months was the growing
realization that technology and its business implications were expanding faster
than anyone had anticipated. The internet propelled this growing awareness that
technology was both creating new enterprises and changing traditional business
operations. "Brick-and-mortar" retailers, for example, began evolving into
"click-and-mortar" operations in which their traditional stores became
supplemented by catalogue operations and websites. In the business-to-business
environment, large enterprises such as General Electric and General Motors
implemented new web-based systems, tying their production departments to their
supplying companies, creating potentially enormous efficiencies in ordering and
receiving supplies from vendors.
Investors' enthusiasm for technology spilled into the initial public offering
market. Shares of new technology companies, especially those involved in
e-commerce, rose rapidly.
The Fund was very well positioned to take advantage of these trends. Over the
six-month period, the Fund's average weighting in technology totaled more than
half its net assets. Software company stocks, for
19
<PAGE>
EVERGREEN
Select Small Cap Growth Fund
Portfolio Manager Commentary
example, averaged 16% of net assets during the period, while hardware averaged
23.6% and telecommunications averaged 12.6% of Fund net assets. All three
industries were over-weighted when compared to investment benchmarks. In
addition, stock selection within each of these industries was very good, as
portfolio holdings outperformed sector benchmarks. The Fund also successfully
invested in a number of initial public stock offerings, supporting overall
performance.
Top 5 Industries
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Information Services & Technology 31.1%
Business Equipment & Services 9.2%
Electronic Equipment & Services 8.1%
Electrical Equipment & Services 7.9%
Printing, Publishing, Broadcasting &
Entertainment 7.3%
Strategy
Investments in the software industry were the largest contributors to
performance, followed by hardware and telecommunications selections.
Electronic commerce was a major link among many of the better performing stocks
in the portfolio, including two initial public offerings, or IPOs: Commerce One
and Art Technology Group.
Commerce One, 20% of which is owned by General Motors, has developed a software
system that manages an electronic marketplace linking major manufacturers, such
as GM, with all suppliers, creating significant efficiencies in ordering and
supplying parts for the production process. The stock rose 855% after the
Fund's acquisition at the IPO. Art Technology Group is in a similar business,
producing software that runs electronic commerce sites for other businesses.
The Fund invested in the stock at its IPO in mid-July. The investment had
appreciated 609% by the end of the period on December 31, 1999.
Other "e-commerce" investments that did particularly well included QRS Corp.,
which operates a data base for universal product codes for web-based commerce,
allowing businesses to easily identify and keep track of products
electronically. Its stock rose by 102% during the six-month period. Another
successful investment was in Netegrity, which provides security systems for e-
commerce operations and is linked to the General Electric system. Its stock
rose by 129% after the Fund's investment on September 16, 1999 through the end
of 1999.
Clarify, a company that produces software enabling corporations to keep track of
all their relationships with customers and suppliers, was a leading performer.
The Fund invested in Clarify in mid-August and enjoyed a 259% gain after Clarify
received an acquisition offer from Nortel. Another software investment that
performed particularly well was Progress Software. The stock of this company,
which produces database management software, rose 101% during the six-month
period.
The long-term potential of hand-held digital devices for computing and
telecommunications drove the performance of many hardware-related investments.
Among the successful investments were: Kopin, which makes semi-conductors for
digital handsets; Three Five Systems, which manufactures display systems for
handsets; and Sandisk, which produces very small semi-conductors that provide
memory systems for digital phones.
Telecommunications tends to be dominated by large companies in which the Fund
cannot invest. However, we did find opportunities in some smaller
telecommunications companies, including Primus Telecom, which operates an
international fibre-optic based network, and Rural Cellular, which provides
cellular phone service in areas not serviced by the large, national networks.
20
<PAGE>
EVERGREEN
Select Small Cap Growth Fund
Portfolio Manager Commentary
Top 10 Holdings
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Kronos, Inc. 3.6%
Documentum, Inc. 2.6%
Universal Electronics, Inc. 2.3%
Startek, Inc. 2.2%
Three Five Systems, Inc. 2.2%
QRS Corp. 2.2%
Entercom Communications Corp. 2.2%
Sandisk Corp. 2.1%
Molecular Devices Corp. 2.1%
Natural Microsystems Corp. 2.1%
Strategy
We adjusted our long-term strategy of investing in small-company growth stocks
to gain greater flexibility. We now can maintain investments in fast-growing
companies, even if they grow to be larger than the limits of traditional small-
cap benchmarks. We believe this flexibility will allow us to keep winning stocks
for longer periods of time. While we have made this change, we still intend to
keep our focus on small-cap stocks and keep the average market capitalization of
holdings within the small-cap universe. As before, new investments will continue
to be confined to small-cap stocks. This greater flexibility allowed us to main
an investment in one of the Fund's best performing companies during the period,
Applied Micro Circuits. It grew to be more than $6 billion in market
capitalization. Under our older restrictions, we would have lost the opportunity
to benefit from its growth after it reached $2 billion in market capitalization.
Outlook
Even after the strong performance of the past six months, we remain optimistic
about the opportunities, particularly in technology. While we see some
companies whose stock prices have grown too high for their business
fundamentals, we also see significant investment opportunities created by the
internet, fibre-optics in networks, and hand-held, wireless communications
devices.
In addition, we believe there are excellent values in some non-technology
stocks, including cyclical manufacturing and industrial companies whose stocks
have been bypassed in the market's enthusiasm for technology. These include
aluminum suppliers, paper and commodity processors and suppliers. Many of these
companies are well positioned to benefit from the broad expansion of the global
economy.
We will continue to exercise our long-term discipline to invest in small, high-
growth companies with reasonable stock valuations. Additionally, we will
continue to take profits where stock prices have grown more rapidly than
justified by a company's future growth opportunities.
21
<PAGE>
EVERGREEN
Select Small Company Value Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
Evergreen Select Small Company Value Fund seeks capital appreciation by
investing in little-known and relatively small companies. The management team
seeks to identify small companies that are favorably priced and have both
entrepreneurial managements and catalysts for growth. The investment discipline
pays special attention to valuations and diversification by industry and company
to reduce the volatility associated with small-cap stocks.
Process
The Fund's management team uses an intensive research process to assemble a
diversified stock portfolio of small companies that:
. Are potential merger and acquisition candidates;
. Have promising new products that can cause a dramatic change in earnings;
. Are "value-timing" candidates because, while their stock may be temporarily
out of favor, they offer the potential of good, long-term appreciation;
. Can benefit from re-structuring programs of management
Benchmark
Russell 2000 Value Index
(Russell 2000 Value)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 12/23/1997 Class I Class IS
Class Inception Date 12/23/1997 12/31/1998
Average Annual Returns
6 months -4.93% -5.06%
1 year -3.29% -4.01%
3 years n/a n/a
5 years n/a n/a
Since Portfolio Inception -7.21% -7.70%
6-month income dividends per share $0.02 $0.01
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Evergreen Select Consumer Price Russell 2000
Sm Comp Value I Index - US Value
12/31/97 1,000,000 1,000,000 1,000,000
6/30/98 985,352 1,010,539 1,044,373
12/31/98 865,689 1,016,119 935,505
6/30/99 880,655 1,030,378 984,678
12/31/99 837,249 1,044,017 921,555
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Small Company Value Fund Class I1, the Russell 2000 Value and the Consumer Price
Index (CPI).
The Russell 2000 Value is an unmanaged index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Class IS prior to its inception is based on the
performance of Class I and has not been adjusted to reflect the effect of the
0.25% 12b-1 fee applicable to Class IS. Class I pays no 12b-1 fee. If these
fees had been reflected returns would have been lower.
Smaller capitalization stock investing may offer the potential for greater long
term results; however, it is also generally associated with greater volatility
due to the higher risk of failure.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
22
<PAGE>
EVERGREEN
Select Small Company Value Fund
Portfolio Manager Commentary
Portfolio Management
Evergreen Select Small Company Value Fund is managed by Jordan Alexander, CFA.
Mr. Alexander joined Evergreen Asset Management Corp. in 1998, and is now a Vice
President of the firm. Earlier in his career, he was a health care associate
analyst at PaineWebber Incorporated and a senior financial analyst and auditor
at Arthur Andersen LLP.
[PHOTO]
Jordan Alexander, CFA
Performance
Evergreen Select Small Company Value Fund outperformed its benchmark during a
very difficult period for small cap value investing. For the six-month period
ended December 31, 1999, the Fund's Class I shares generated a total return of
- -4.93%, compared with the Russell 2000 Value Index, a common benchmark of small
company value investing, which had a total return of -6.41%. The performance of
the Fund during the period was helped by strong gains in several issues in the
technology/communications and health care sectors.
Portfolio
Characteristics
--------------------
(as of 12/31/1999)
Total Net Assets $85,115,454
Number of Holdings 83
P/E Ratio 20.9x
Beta N/A
Environment
The final six months of 1999 offered a very difficult environment for small cap
value investing. During this period, market leadership tended to be narrowly
focused on a relatively small group of large cap growth and technology
companies. While the Russell 2000 did well, performance tended to be limited to
issues in the technology sector, especially companies focused on the internet,
and initial public stock offerings. The Fund invests in attractively valued
small cap companies with a history of stable earnings growth, and issues with
these characteristics tended to be ignored by the market.
Top 5 Industries
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Banks 13.1%
Retailing & Wholesale 13.0%
Building, Construction & Furnishings 12.2%
Consumer Products & Services 12.0%
Healthcare Products & Services 10.1%
23
<PAGE>
EVERGREEN
Select Small Company Value Fund
Portfolio Manager Commentary
Strategy
The present management team assumed responsibility for the Fund in September and
began to restructure the portfolio. As part of the restructuring, we reduced
the Fund's weighting in the financial services sector and removed issues that we
believe had deteriorating business fundamentals and lacked catalysts for better
stock performance. In addition, we began to add attractively valued investments
in the technology and health care sectors. As we pursued this restructuring, we
pared down the number of portfolio holdings by a third, reducing the number of
companies from 128 on June 30 to 83 on December 31, 1999. In general, we did
not change industry allocations significantly, although we did reduce Fund
holdings in the financial sector, which we believe continue to be vulnerable in
a rising interest rate environment.
The restructuring helped the performance of the Fund during the final two months
of the fiscal period. Contributors to the improved performance included a
number of issues in the technology, health care and telecommunications sectors.
For example, approximately half of the 20 best performers in the Fund during the
period were either new names or additions to existing holdings. These issues
included Arthrocare and new names in the technology/communications sector, such
as CSG Systems and SBS Technologies. Arthrocare, which appreciated 326.3% during
the period, is developing several new products for the arthroscopy market. We
initiated our position in Arthrocare early last year when the stock was trading
at a forward price-earnings multiple of approximately 16x. The stock has
performed very well, as investors began to focus on the company's opportunities
in the spinal surgery and cosmetic surgery markets. CSG Systems, which
appreciated 63.2% during the period, provides customer care and billing systems
for the communications market. The company maintains its internally developed
software and is benefiting from the trend toward billing/customer service
outsourcing in the cable TV industry. CSG should see strong earnings growth
over the next several years as subscriber revenues increase from new services
offered by cable operators. SBS Technologies, which gained 44.6%, designs
custom embedded computer products that are used in the aerospace, computer and
telecommunications industries. The company's performance has been helped by
several design wins in the rapidly growing telecommunications market.
Other new holdings that helped the Fund's performance included Whole Foods
Market, which appreciated 41.6%, and Guess? Inc., which rose 32.1%. While many
of the portfolio additions had a positive impact on performance, the Fund was
hurt by a heavy weighting in financials, consumer cyclicals and consumer
staples. Many of the issues in these sectors were affected by investors'
concerns over rising interest rates.
Top 10 Holdings
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Whole Foods Market, Inc. 3.0%
Michael Foods, Inc. 2.6%
Alpharma, Inc., Cl. A 2.5%
Interim Services, Inc. 2.1%
SBS Technologies, Inc. 2.0%
Micros Systems, Inc. 2.0%
Ross Stores, Inc. 2.0%
Civic Bancorp. 1.9%
Genlyte Group, Inc. 1.9%
Furniture Brands International, Inc. 1.8%
24
<PAGE>
EVERGREEN
Select Small Company Value Fund
Portfolio Manager Commentary
Outlook
We are very positive about the potential for strong small-cap stock performance
as valuations of small-caps relative to larger companies are at some of the most
attractive levels in many years. In the past, the small-cap sector posted
dramatic gains following similar periods of underperformance. For example,
small-caps more than doubled in 1975-76 and were up over 65% in 1990-91 after
declining about 20% in the preceding year. The acceleration of stock buybacks
and merger and acquisition activity in the small-cap sector could provide a
catalyst for the small-cap sector this year. Favorable small-cap performance
has generally coincided with periods of strong cyclical growth, lower relative
cost of capital, and a more profitable business environment. While the cost of
capital for small-cap companies relative to larger companies suggests
uncertainty, the overall economic outlook for earnings growth and profitability
supports a favorable trend.
25
<PAGE>
EVERGREEN
Select Social Principles Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
Evergreen Select Social Principles Fund invests in the stocks of mid-sized U.S.
companies, average market capitalization of $3 billion. The Fund emphasizes
companies that generally respect human rights, play a role in local communities,
and produce useful products in an environmentally sound way. This philosophy
holds that socially conscious investing promotes responsible values without
impairing long-term performance.
Process
The Fund utilizes a fundamental, bottom-up stock selection process which is
research intensive. In addition, the Fund utilizes an external Advisory Board
whose role is to develop and continually review guiding policies and principles
of social investing. All holdings are periodically reviewed to assure adherence
to the Advisory Board Standards.
Benchmark
Standard & Poor's MidCap 400 Index
(S&P MidCap 400)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 5/31/1988 Class I Class IS
Class Inception Date 11/24/1997 3/12/1998
Average Annual Returns
6 months 5.53% 5.38%
1 year 6.95% 6.68%
3 years 12.71% 12.39%
5 years 18.14% 17.83%
10 years 13.84% 13.56%
Since Portfolio Inception 13.88% 13.60%
6-month income dividends per share $0.06 $0.04
6-month capital gain distributions per share $8.48 $8.48
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Select Social Priniciples Consumer Price Index - US S & P 400 Midcap
12/31/89 1,000,000 1,000,000 1,000,000
12/31/90 923,575 1,061,063 948,811
12/31/91 1,328,376 1,093,577 1,424,143
12/31/92 1,460,974 1,125,297 1,593,830
12/31/93 1,601,794 1,156,225 1,815,798
12/31/94 1,588,316 1,187,153 1,751,021
12/31/95 2,187,987 1,217,288 2,290,121
12/31/96 2,552,891 1,257,732 2,729,431
12/31/97 3,151,017 1,279,144 3,604,695
12/31/98 3,418,618 1,299,762 4,293,463
12/31/99 3,656,298 1,335,448 4,923,001
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Social Principles Fund Class I1, S&P MidCap 400 and the Consumer Price Index
(CPI).
The S&P MidCap 400 is an unmanaged index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Class IS from 11/24/1997 to its inception is
based on the performance of Class I and has not been adjusted to reflect the
effect of the 0.25% 12b-1 fee applicable to Class IS. Class I pays no 12b-1
fee. If these fees had been reflected, returns would have been lower. Prior to
11/24/1997, the returns for Classes I and IS are based on the Fund's predecessor
common trust fund's (CTF) performance, adjusted for estimated mutual fund
expenses. The CTF were not registered under the 1940 Act and were not subject to
certain investment restrictions. If the CTF had been registered, their
performance might have been adversely affected.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
26
<PAGE>
EVERGREEN
Select Social Principles Fund
Portfolio Manager Commentary
Portfolio Management Team
[PHOTO] [PHOTO]
Jay Zelko Timothy M. Stevenson, CFA
[PHOTO]
Eric. M. Teal
Performance
For the six-month period ended December 31, 1999, the Evergreen Select Social
Principles Fund, Class I Shares', 5.53% return narrowly trailed that of its
benchmark, the S&P Midcap 400 Index, which returned 7.35% for the same period.
The Fund lagged its benchmark during the first three months due primarily to
poor performance among its capital goods holdings. Strong relative returns in
the final three months can be attributed to solid gains within the portfolio's
technology exposure.
Portfolio
Characteristics
-------------------
(as of 12/31/1999)
Total Net Assets $106,662,925
Number of Holdings 68
P/E Ratio 23.0x
Beta 1.26
Environment
The first half of the Fund's fiscal year was divided into two distinctly
different periods, as the market fell during the first three months, then
rebounded sharply in the final quarter of 1999. Negative returns in the opening
months were primarily a result of well-publicized Y2K risks, higher crude oil
prices and rising interest rates that all combined to concern investors.
The market's second half comeback was a due to ideal economic conditions--strong
economic growth, benign inflation and low unemployment--along with strong
earnings reports, prompting investors to shrug off negative information and
drive stock prices higher.
Top 5 Industries
--------------------------------------------
(as a percentage of 12/31/1999 net assets)
Information Services & Technology 28.0%
Retailing & Wholesale 8.3%
Healthcare Products & Services 7.1%
Finance & Insurance 6.5%
Food & Beverage Products 6.4%
27
<PAGE>
EVERGREEN
Select Social Principles Fund
Portfolio Manager Commentary
Strategy
The Fund lost ground during the volatile third quarter of 1999, but exceeded its
benchmark during the fourth quarter. Technology and communication services
represented two of the market's hottest-performing areas during the fourth
quarter, and the portfolio's overweighted position in both aided the Fund's
performance. Strong gains from computer hardware maker EMC Corp., up over 85%,
improved results. Other technology stocks in the fiberoptic and software
industries contributed to strong absolute performance: Veritas Software rose
over 230%, JDS Uniphase gained over 225%, and semiconductor company, PMC-Sierra,
jumped 120%.
Within a number of the portfolio's sector weightings, we remain strategically
positioned to capitalize on specific subsectors that enjoy strong fundamentals.
Underlying our technology exposure is an emphasis on semi-conducters and
software manufacturers. Within our financial services weighting, we decreased
exposure to insurance companies and we reduced the portfolio's weighting of
medical services stocks within an already underweighted healthcare position.
Due to strong seasonal factors and positive underlying fundamentals in the
retail sector, the portfolio remains very committed to this area. Current
holdings include Best Buy, Circuit City and Abercrombie & Fitch. Conversely, we
remain underweighted in the utility sector.
Top 10 Holdings
------------------------------------------
(as a percentage of 12/31/1999 net assets)
PMC-Sierra, Inc. 6.5%
Veritas Software Corp. 6.0%
Qwest Communications International, Inc. 3.6%
Teradyne, Inc. 3.6%
Best Buy Co., Inc. 3.3%
Compuware Corp. 3.3%
Sanmina Corp. 2.9%
Siebel Systems, Inc. 2.3%
Tellabs, Inc. 2.2%
United States Food Services 2.1%
Outlook
We continue to hold an optimistic outlook for mid-cap equities. Though mid-cap
stocks have underperformed their large-cap brethren for the past few years,
there are signs that a market rotation may be taking place. Our forecast proved
a few months premature, but the rotation definitely transpired during the final
three months of 1999 as mid-cap stocks outpaced their larger counterparts.
We believe this valuation disparity between large-cap and smaller-cap stocks as
well as mid-caps' own strong fundamentals, will attract investors to mid-cap
equities. We anticipate mid-caps' solid performance to continue and
enthusiastically look forward to the next few years.
28
<PAGE>
EVERGREEN
Select Strategic Growth Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
Evergreen Select Strategic Growth Fund is a growth-style equity product that
emphasizes large and mid-sized U.S. companies. We believe that superior long-
term returns can be achieved through a disciplined approach of investing in
stocks with excellent historical and future earnings growth.
Process
The Fund is managed by two investment professionals who utilize a unique blend
of quantitative and qualitative fundamental analysis. This bottom-up stock
selection process is research-intensive and identifies companies which exhibit
strong current fundamentals, histories of superior earnings/dividend growth and
rising earnings expectations.
Benchmark
Russell 1000 Growth Index
(Russell 1000 Growth)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 12/31/1994 Class I Class IS
Class Inception Date 11/24/1997 2/27/1998
Average Annual Returns
6 months 41.30% 41.13%
1 year 58.29% 57.88%
3 years 37.04% 36.67%
Since Portfolio Inception 34.59% 34.24%
6-month income dividends per share $0.02 $0.00
6-month capital gain distributions per share $8.05 $8.05
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Class I CPI Russell 1000 Growth
12/31/94 1,000,000 1,000,000 1,000,000
6/30/95 1,209,641 1,018,704 1,202,924
12/31/95 1,382,642 1,025,384 1,371,851
6/30/96 1,516,114 1,046,760 1,537,472
12/31/96 1,715,660 1,059,452 1,689,055
6/30/97 2,004,134 1,070,808 2,019,276
12/31/97 2,242,768 1,077,488 2,203,996
6/30/98 2,621,608 1,088,844 2,653,042
12/31/98 2,789,394 1,094,856 3,057,038
6/30/99 3,124,954 1,110,220 3,376,522
12/31/99 4,416,398 1,124,916 4,070,222
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Strategic Growth Fund Class I1, the Russell 1000 Growth and the Consumer Price
Index (CPI).
The Russell 1000 Growth is an unmanaged index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may
vary based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Class IS from 11/24/1997 to its inception is
based on the performance of Class I and has not been adjusted to reflect the
effect of the 0.25% 12b-1 fee applicable to Class IS. Class I pays no 12b-1
fee. If these fees had been reflected, returns would have been lower. Prior to
11/24/1997, the returns for Classes I and IS are based on the Fund's predecessor
common trust fund's (CTF) performance, adjusted for estimated mutual fund
expenses. The CTF was not registered under the 1940 Act and was not subject to
certain investment restrictions. If the CTF had been registered, its
performance might have been adversely affected.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
29
<PAGE>
EVERGREEN
Select Strategic Growth Fund
Portfolio Manager Commentary
Portfolio Management Team
David M. Chow, CFA and W. Shannon Reid, CFA manage the Evergreen Select
Strategic Growth Fund. They have over 29 years combined investment experience
and boast a unique blend of quantitative and traditional fundamental analysis
skills.
[PHOTO] [PHOTO]
David M. Chow, CFAW. Shannon Reid, CFA
Performance
The Evergreen Select Strategic Growth Fund, Class I Shares, advanced 41.30% for
the six-month period ended December 31, 1999. This performance significantly
outpaced our benchmark, the Russell 1000 Growth Index, which returned 20.56% for
the same period.
Portfolio
Characteristics
---------------
(as of 12/31/1999)
Total Net Assets $731,040,556
Number of Holdings 62
P/E Ratio 45.5x
Beta 1.25
Environment
A strong domestic economy, an improving global economic outlook and the absence
of signs of inflation drove stock market indices to record valuation levels
during this reporting period. The macro-economic environment notwithstanding,
the Fund's management team continues to employ a combination of quantitative and
qualitative investment analysis that seeks to identify companies that will
exhibit superior and sustainable earnings growth. This methodology has resulted
in a portfolio currently skewed towards technology and consumer cyclicals and
underweighted in traditional growth oriented sectors such as consumer staples
and health care.
Strategy
Technology stocks were the undisputed winners for the reporting period and the
year. As of December 31, 1999, this group represented the Fund's largest
sector. Within the sector we continue to emphasize three trends: (1)
technological advances in communications networks, (2) the growth in demand for
enterprise information storage solutions and (3) business-to-business electronic
commerce.
30
<PAGE>
EVERGREEN
Select Strategic Growth Fund
Portfolio Manager Commentary
Cisco Systems and JDS Uniphase, two of the Fund's larger holdings, are prime
beneficiaries of this first trend. Cisco is the dominant player in data
communications infrastructure equipment controlling more than three-quarters of
the market for key internet backbone products such as routers and switches. JDS
Uniphase is the leading component provider for advanced fiber optics networks
utilizing a relatively new technology called dense-wavelength divisional
multiplexing. On the enterprise information storage front, EMC Corporation is
the undisputed leader. This market will continue to experience explosive
growth, as the global economy increasingly becomes information based. Business-
to-business electronic commerce companies became the darlings of Wall Street in
the latter half of 1999. Issues held by the Fund in this area include
Broadvision and Siebel Systems. While we are optimistic regarding the growth
opportunities for these companies we have recently trimmed positions given the
recent rapid price appreciation of the stocks.
Top 5 Industries
------------------------------------------
(as a percentage of 12/31/1999 net assets)
Information Services & Technology 33.8%
Healthcare Products & Services 12.2%
Communication Systems & Services 10.8%
Retailing & Wholesale 9.6%
Telecommunication Services & Equipment 5.1%
Consumer cyclicals represented the Fund's second largest sector weighting at 21%
versus 18% for the benchmark. Healthy consumer spending patterns, innovative
business models, and strong management teams were the factors shared by our top
performers. These included Yahoo (up 151% for the period), America Online (up
38%), Home Depot (up 60%) and Wal-Mart (up 43%). We have always included Yahoo
and America Online in the media subsector of consumer cyclicals as opposed to
technology, a definition we believe was validated by the recently announced
AOL/Time Warner merger.
Our exposure to health care at 12% is below that of the benchmark's 13%. The
underweighting is attributable to our concerns toward decelerating earnings
growth for many of these companies as well as rhetoric regarding increased
regulation as we cycle through the presidential campaign.
Likewise, we are underweighted in consumer staples. We find this group
generally unattractive given their relatively low top line growth and premium
valuations.
Top 10 Holdings
------------------------------------------
(as a percentage of 12/31/1999 net assets)
Cisco Systems, Inc. 5.8%
Microsoft Corp. 5.6%
Yahoo!, Inc. 4.1%
General Electric Co. 3.3%
Lucent Technologies, Inc. 2.6%
Johnson & Johnson 2.5%
Home Depot, Inc. 2.5%
America Online, Inc. 2.4%
Procter & Gamble Co. 2.4%
EMC Corp. 2.3%
Outlook
The past six months has been an extraordinary market environment. We urge
investors not to expect returns of this magnitude to continue indefinitely. For
the near term, stock valuations in certain areas are overextended. Nevertheless,
we remain positive. Growth stock investing is ultimately about identifying
companies that will produce superior and sustainable earnings growth. Given the
extraordinary events taking place in the fields of technology, economics and
global politics, we believe these opportunities are more abundant than ever.
31
<PAGE>
EVERGREEN
Select Strategic Value Fund
Fund at a Glance as of December 31, 1999
- --------------------------------------------------------------------------------
PORTFOLIO PROFILE
- --------------------------------------------------------------------------------
Philosophy
Evergreen Select Strategic Value Fund is a value-style equity fund which
emphasizes large and mid-capitalization U.S. companies. This philosophy holds
that stocks, over time, can become mispriced relative to their true value and
that attractive opportunities can be identified through a combination of
quantitative analysis and rigorous fundamental research.
Process
Following the initial screening by our proprietary model which determines that
a stock is selling at a reasonable valuation level, the Strategic Value team
employs a labor intensive research effort in order to identify clues to uncover
value. Qualitative factors which are analyzed include industry leadership,
quality of management, the company's current competitive position and future
earnings prospects.
Benchmark
Russell 1000 Value Index
(Russell 1000 Value)
- --------------------------------------------------------------------------------
PERFORMANCE AND RETURNS1
- --------------------------------------------------------------------------------
Portfolio Inception Date: 12/31/1981 Class I Class IS
Class Inception Date 11/24/1997 3/11/1998
Average Annual Returns
6 months -1.87% -2.00%
1 year 9.06% 8.80%
3 years 15.31% 15.05%
5 years 20.79% 20.51%
10 years 14.19% 13.91%
Since Portfolio Inception 16.86% 16.58%
6-month income dividends per share $1.63 $1.37
6-month capital gain distributions per share $4.19 $4.19
- --------------------------------------------------------------------------------
LONG TERM GROWTH
- --------------------------------------------------------------------------------
[GRAPH]
Class I CPI Russell 1000 Value
6/30/89 1,000,000 1,000,000 1,000,000
6/30/90 871,191 1,061,063 919,165
6/30/91 1,063,238 1,093,577 1,145,329
6/30/92 1,272,913 1,125,297 1,303,510
6/30/93 1,440,274 1,156,225 1,539,748
6/30/94 1,466,163 1,187,153 1,509,126
6/30/95 1,954,466 1,217,288 2,087,871
6/30/96 2,458,529 1,257,732 2,539,685
6/30/97 3,251,555 1,279,144 3,433,545
6/30/98 3,456,038 1,299,762 3,970,216
6/30/99 3,768,732 1,335,448 4,262,214
Comparison of the change in value of a $1,000,000 investment in Evergreen Select
Strategic Value Fund Class I1, Russell 1000 Value and the Consumer Price Index
(CPI).
The Russell 1000 Value is an unmanaged index which does not include transaction
costs associated with buying and selling securities nor any management fees. The
CPI is a commonly used measure of inflation and does not represent an investment
return. It is not possible to invest directly in an index.
1 Past performance is no guarantee of future results. The investment return and
principal value will fluctuate so that an investor's shares, when redeemed, may
be worth more or less than original cost. The performance of each class may vary
based on differences in loads, fees and expenses paid by the shareholders
investing in each class. Index returns do not reflect expenses, which have been
deducted from the Fund's return.
Historical performance shown for Class IS from 11/24/1997 to its inception is
based on the performance of Class I and has not been adjusted to reflect the
effect of the 0.25% 12b-1 fee applicable to Class IS. Class I pays no 12b-1
fee. If these fees had been reflected, returns would have been lower. Prior to
11/24/1997, the returns for Classes I and IS are based on the Fund's predecessor
common trust fund's (CTF) performance, adjusted for estimated mutual fund
expenses. The CTF was not registered under the 1940 Act and was not subject to
certain investment restrictions. If the CTF had been registered, its
performance might have been adversely affected.
Investment objective is non-fundamental and may be changed without the vote of
the Fund's shareholders.
32
<PAGE>
EVERGREEN
Select Strategic Value Fund
Portfolio Manager Commentary
Portfolio Management
[PHOTO]
Timothy O'Grady
Performance
For the six-month period ended December 31, 1999, the -1.87% return of the
Evergreen Select Strategic Value Fund, Class I Shares, outpaced that of its
benchmark, the Russell 1000 Value Index, which returned -4.89% for the same
period. Strong relative performance during the period can be primarily
attributed to a strategic overweighting and stock selection within the
technology sector.
Portfolio
Characteristics
---------------
(as of 12/31/1999)
Total Net Assets $763,143,554
Number of Holdings 45
P/E Ratio 16.3x
Beta 0.92
Environment
U.S. equity investors experienced a roller-coaster ride over the past six
months, as the S&P 500 Index fell in the first three months before rebounding
nearly 15% in the latter half of the period. Equity investors were concerned by
rising interest rates, inflationary and Y2K fears in the opening months, but
then simply shrugged off these negative events and drove every major equity
index higher during the fourth quarter of 1999.
Underlying the entire six-month period was the market's insatiable appetite for
technology stocks. This ultra-growth segment of the market proved to be the
best performer in 1999, and its dramatic rise was the primary reason growth
stocks have again outperformed their value-oriented (and technology-deficient)
counterparts. In the fourth quarter alone, the Russell 1000 Growth Index
outpaced the Russell 1000 Value Index by nearly 20%.
Top 5 Industries
------------------------------------------
(as a percentage of 12/31/1999 net assets)
Banks 12.3%
Oil/Energy 11.8%
Finance & Insurance 9.4%
Utilities-Telephone 8.9%
Telecommunication Services & Equipment 8.2%
33
<PAGE>
EVERGREEN
Select Strategic Value Fund
Portfolio Manager Commentary
Strategy
Despite a difficult period for value investors, the Evergreen Select Strategic
Value Fund posted strong relative returns. Throughout the period we maintained
a technology weighting of roughly 1.5x that of our benchmark--the maximum
weighting permitted. However, we sold some of the portfolio's technology
holdings to lock-in extraordinary gains and reduce our overall exposure to this
group.
Financial services stocks represent another strong sector weighting, and within
this area we modified our bank focus early in the six-month period.
Specifically, we elected to eliminate First American, Summit Bancorporation and
Fleet Financial as portfolio holdings. Due to acquisition activity as well as
other declining fundamentals, we downgraded our outlook for these companies and
removed them from the portfolio. Offsetting these transactions were purchases
of Wells Fargo and Bank of America, two companies enjoying the fundamental
competitive advantages and differentiation theme we find attractive. In the
case of both companies, they possess scale, breadth and intermediation of
products and services and a superior technology platform.
Within the consumer discretionary sector we moved to sell our positions in V.F.
Corporation and Sears, while initiating a position in Lowe's. Strong performers
during the six months include Nokia (up 108.7%), Alcoa (up 35.0%), Century
Telephone (up 19.4%), and Alltell (up 16.6%).
Top 10 Holdings
------------------------------------------
(as a percentage of 12/31/1999 net assets)
Alcoa, Inc. 4.3%
Exxon Mobil Corp. 3.7%
Chase Manhattan Corp. 3.5%
Black & Decker Corp. 3.4%
AT&T Corp. 3.3%
GTE Corp. 3.2%
Mead Corp. 3.2%
Centurytel, Inc. 3.1%
Citigroup, Inc. 3.1%
Disney (Walt) Co. 3.0%
Outlook
Despite the current euphoria over growth stocks, the fundamental reasons for
owning value stocks discussed in our earlier reports have not altered. In fact,
evidence continues to accumulate supporting our stance and outlook. The
domestic economy continues on a sustainable growth path and many foreign
economies are recovering from depressed levels. Corporate earnings momentum
continues positive, both on an absolute basis and relative to expectations.
34
<PAGE>
EVERGREEN
Select Balanced Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 # ----------------------
(Unaudited) 1999 1998 (a)
<S> <C> <C> <C>
CLASS I SHARES
Net asset value, beginning of
period $ 13.56 $ 13.39 $ 12.58
-------- --------- ---------
Income from investment operations
Net investment income 0.21 0.46 0.16
Net realized and unrealized gains 1.32 0.27 0.81
-------- --------- ---------
Total from investment operations 1.53 0.73 0.97
-------- --------- ---------
Distributions to shareholders from
Net investment income (0.25) (0.42) (0.16)
Net realized gains (0.53) (0.14) 0
-------- --------- ---------
Total distributions to shareholders (0.78) (0.56) (0.16)
-------- --------- ---------
Net asset value, end of period $ 14.31 $ 13.56 $ 13.39
-------- --------- ---------
Total return 11.60% 5.70% 7.76%
Ratios and supplemental data
Net assets, end of period
(thousands) $645,161 $ 658,733 $ 723,850
Ratios to average net assets
Expenses++ 0.66%+ 0.69% 0.70%+
Net investment income 3.06%+ 3.47% 2.80%+
Portfolio turnover rate 88% 60% 37%
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 # ----------------------
(Unaudited) 1999 1998 (b)
<S> <C> <C> <C>
CLASS IS SHARES
Net asset value, beginning of
period $ 13.59 $ 13.42 $ 13.34
-------- --------- ---------
Income from investment operations
Net investment income 0.18 0.35 0.07
Net realized and unrealized gains 1.34 0.35 0.09
-------- --------- ---------
Total from investment operations 1.52 0.70 0.16
-------- --------- ---------
Distributions to shareholders from
Net investment income (0.23) (0.39) (0.08)
Net realized gains (0.53) (0.14) 0
-------- --------- ---------
Total distributions to shareholders (0.76) (0.53) (0.08)
-------- --------- ---------
Net asset value, end of period $ 14.35 $ 13.59 $ 13.42
-------- --------- ---------
Total return 11.48% 5.43% 1.23%
Ratios and supplemental data
Net assets, end of period
(thousands) $ 1,038 $ 405 $ 215
Ratios to average net assets
Expenses++ 0.91%+ 0.93% 0.95%+
Net investment income 2.73%+ 3.35% 2.58%+
Portfolio turnover rate 88% 60% 37%
</TABLE>
(a) For the period from January 22, 1998 (commencement of class operations) to
June 30, 1998.
(b) For the period from April 9, 1998 (commencement of class operations) to
June 30, 1998.
+ Annualized.
++ The ratio of expenses to average net assets includes fee waivers and ex-
cludes expense reductions.
# Net investment income is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
35
<PAGE>
EVERGREEN
Select Core Equity Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 ----------------------
(Unaudited) 1999 1998 (a)
<S> <C> <C> <C>
CLASS I SHARES
Net asset value, beginning of
period $ 92.30 $ 92.59 $ 82.97
---------- ---------- ----------
Income from investment operations
Net investment income 0.22 0.72 0.51
Net realized and unrealized gains 6.61 7.51 9.62
---------- ---------- ----------
Total from investment operations 6.83 8.23 10.13
---------- ---------- ----------
Distributions to shareholders from
Net investment income (0.20) (0.69) (0.51)
Net realized gains (9.10) (7.83) 0
---------- ---------- ----------
Total distributions to shareholders (9.30) (8.52) (0.51)
---------- ---------- ----------
Net asset value, end of period $ 89.83 $ 92.30 $ 92.59
---------- ---------- ----------
Total return 8.02% 9.82% 12.23%
Ratios and supplemental data
Net assets, end of period
(thousands) $2,671,204 $1,913,483 $1,952,436
Ratios to average net assets
Expenses++ 0.69%+ 0.67% 0.70%+
Net investment income 0.53%+ 0.83% 0.96%+
Portfolio turnover rate 5% 55% 22%
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 ----------------------
(Unaudited) 1999 1998 (b)
<S> <C> <C> <C>
CLASS IS SHARES
Net asset value, beginning of
period $ 86.54 $ 87.33 $ 80.21
---------- ---------- ----------
Income from investment operations
Net investment income 0.12 0.48 0.27
Net realized and unrealized gains 6.15 7.02 7.16
---------- ---------- ----------
Total from investment operations 6.27 7.50 7.43
---------- ---------- ----------
Distributions to shareholders from
Net investment income (0.10) (0.46) (0.31)
Net realized gains (9.10) (7.83) 0
---------- ---------- ----------
Total distributions to shareholders (9.20) (8.29) (0.31)
---------- ---------- ----------
Net asset value, end of period $ 83.61 $ 86.54 $ 87.33
---------- ---------- ----------
Total return 7.89% 9.53% 9.27%
Ratios and supplemental data
Net assets, end of period
(thousands) $47,460 $30,240 $18,244
Ratios to average net assets
Expenses++ 0.94%+ 0.92% 0.95%+
Net investment income 0.27%+ 0.56% 0.60%+
Portfolio turnover rate 5% 55% 22%
</TABLE>
(a) For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.
(b) For the period from February 4, 1998 (commencement of class operations) to
June 30, 1998.
+ Annualized.
++ The ratio of expenses to average net assets includes fee waivers and ex-
cludes expense reductions.
See Combined Notes to Financial Statements.
36
<PAGE>
EVERGREEN
Select Diversified Value Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 ----------------------
(Unaudited) 1999 1998 (a)
<S> <C> <C> <C>
CLASS I SHARES
Net asset value, beginning of period $ 27.65 $ 26.22 $ 23.81
-------- --------- ---------
Income from investment operations
Net investment income 0.07 0.22 0.14
Net realized and unrealized gains 1.89 2.06 2.41
-------- --------- ---------
Total from investment operations 1.96 2.28 2.55
-------- --------- ---------
Distributions to shareholders from
Net investment income (0.09) (0.20) (0.14)
Net realized gains (1.08) (0.65) 0
-------- --------- ---------
Total distributions to shareholders (1.17) (0.85) (0.14)
-------- --------- ---------
Net asset value, end of period $ 28.44 $ 27.65 $ 26.22
-------- --------- ---------
Total return 7.27% 9.08% 10.72%
Ratios and supplemental data
Net assets, end of period (thousands) $543,140 $ 606,355 $ 797,352
Ratios to average net assets
Expenses++ 0.62%+ 0.62% 0.68%+
Net investment income 0.53%+ 0.88% 1.24%+
Portfolio turnover rate 23% 76% 56%
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 ----------------------
(Unaudited) 1999 1998 (b)
<S> <C> <C> <C>
CLASS IS SHARES
Net asset value, beginning of period $ 27.33 $ 25.93 $ 26.56
-------- --------- ---------
Income from investment operations
Net investment income 0.04 0.12 0.06
Net realized and unrealized gains or
losses 1.86 2.07 (0.64)
-------- --------- ---------
Total from investment operations 1.90 2.19 (0.58)
-------- --------- ---------
Distributions to shareholders from
Net investment income (0.06) (0.14) (0.05)
Net realized gains (1.08) (0.65) 0
-------- --------- ---------
Total distributions to shareholders (1.14) (0.79) (0.05)
-------- --------- ---------
Net asset value, end of period $ 28.09 $ 27.33 $ 25.93
-------- --------- ---------
Total return 7.11% 8.77% (2.19%)
Ratios and supplemental data
Net assets, end of period (thousands) $ 1,413 $ 1,384 $ 210
Ratios to average net assets
Expenses++ 0.87%+ 0.88% 0.93%+
Net investment income 0.28%+ 0.62% 0.80%+
Portfolio turnover rate 23% 76% 56%
</TABLE>
(a) For the period from January 22, 1998 (commencement of class operations) to
June 30, 1998.
(b) For the period from March 31, 1998 (commencement of class operations) to
June 30, 1998.
+ Annualized.
++ The ratio of expenses to average net assets includes fee waivers and ex-
cludes expense reductions.
See Combined Notes to Financial Statements.
37
<PAGE>
EVERGREEN
Select Large Cap Blend Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 --------------------
(Unaudited) 1999 (d) 1998 (a)
<S> <C> <C> <C>
CLASS I SHARES (c)
Net asset value, beginning of period $ 48.35 $ 50.74 $ 45.05
-------- --------- ---------
Income from investment operations
Net investment income 0.13 0.40 0.23
Net realized and unrealized gains 1.46 2.81 5.70
-------- --------- ---------
Total from investment operations 1.59 3.21 5.93
-------- --------- ---------
Distributions to shareholders from
Net investment income (0.13) (0.40) (0.24)
Net realized gains (6.51) (5.20) 0
-------- --------- ---------
Total distributions to shareholders (6.64) (5.60) (0.24)
-------- --------- ---------
Net asset value, end of period $ 43.30 $ 48.35 $ 50.74
-------- --------- ---------
Total return 3.53% 7.12% 13.18%
Ratios and supplemental data
Net assets, end of period (thousands) $344,219 $ 438,375 $ 497,534
Ratios to average net assets
Expenses++ 0.70%+ 0.68% 0.71%+
Net investment income 0.54%+ 0.79% 0.80%+
Portfolio turnover rate 11% 46% 42%
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 --------------------
(Unaudited) 1999 (d) 1998 (b)
<S> <C> <C> <C>
CLASS IS SHARES
Net asset value, beginning of period $ 48.33 $ 50.74 $ 49.75
-------- --------- ---------
Income from investment operations
Net investment income 0.08 0.28 0.08
Net realized and unrealized gains 1.45 2.81 1.00
-------- --------- ---------
Total from investment operations 1.53 3.09 1.08
-------- --------- ---------
Distributions to shareholders from
Net investment income (0.08) (0.30) (0.09)
Net realized gains (6.51) (5.20) 0
-------- --------- ---------
Total distributions to shareholders (6.59) (5.50) (0.09)
-------- --------- ---------
Net asset value, end of period $ 43.27 $ 48.33 $ 50.74
-------- --------- ---------
Total return 3.41% 6.83% 2.17%
Ratios and supplemental data
Net assets, end of period (thousands) $ 429 $ 382 $ 301
Ratios to average net assets
Expenses++ 0.95%+ 0.93% 0.96%+
Net investment income 0.30%+ 0.53% 0.57%+
Portfolio turnover rate 11% 46% 42%
</TABLE>
(a) For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.
(b) For the period from March 12, 1998 (commencement of class operations) to
June 30, 1998.
(c) On April 30, 1999, Class IC shares of the Fund were converted to Class I
shares. Shareholders of Class IC shares became owners of that number of
Class I shares having a net asset value equal to the net asset value of
their shares immediately prior to the close of business on April 30, 1999.
Class IC is the accounting survivor, its basis of accounting for assets and
liabilities and its operating results for the periods prior to April 30,
1999 have been carried forward in these financial statements.
(d) The Fund redesignated $0.02 per share for Class I and IS of distributions
from net investment income declared after January 1, 1999, as capital gains
distributions after January 1, 1999.
+ Annualized.
++ The ratio of expenses to average net assets includes fee waivers and
excludes expense reductions.
See Combined Notes to Financial Statements.
38
<PAGE>
EVERGREEN
Select Secular Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended
December 31, 1999 Period Ended
(Unaudited) June 30, 1999 (a)
<S> <C> <C>
CLASS I SHARES
Net asset value, beginning of period $ 99.99 $100.00
-------- -------
Income from investment operations
Net investment income or loss (0.13) 0.15
Net realized and unrealized gains or
losses 49.27 (0.01)
-------- -------
Total from investment operations 49.14 0.14
-------- -------
Distributions to shareholders from
Net investment income 0 (0.15)
Net realized and unrealized gains on
securities (3.27) 0
-------- -------
Total distributions to shareholders (3.27) (0.15)
-------- -------
Net asset value, end of period $ 145.86 $ 99.99
-------- -------
Total return 50.01% 0.14%
Ratios and supplemental data
Net assets, end of period (thousands) $945,226 $40,128
Ratios to average net assets
Expenses++ 0.70%+ 0.71%+
Net investment income or loss (0.18%)+ 0.18%+
Portfolio turnover rate 48% 65%
<CAPTION>
Six Months Ended
December 31, 1999 Period Ended
(Unaudited) June 30, 1999 (a)
<S> <C> <C>
CLASS IS SHARES
Net asset value, beginning of period $ 99.95 $100.00
-------- -------
Income from investment operations
Net investment income or loss (0.26) 0.21
Net realized and unrealized gains or
losses 49.15 (0.15)
-------- -------
Total from investment operations 48.89 0.06
-------- -------
Distributions to shareholders from
Net investment income 0 (0.11)
Net realized and unrealized gains on
securities (3.27) 0
-------- -------
Total distributions to shareholders (3.27) (0.11)
-------- -------
Net asset value, end of period $ 145.57 $ 99.95
-------- -------
Total return 49.77% 0.06%
Ratios and supplemental data
Net assets, end of period (thousands) $ 81 $ 1
Ratios to average net assets
Expenses++ 0.95%+ 0.96%+
Net investment income or loss (0.50%)+ 0.63%+
Portfolio turnover rate 48% 65%
</TABLE>
(a) For the period from February 26, 1999 (commencement of class operations) to
June 30, 1999.
+ Annualized.
++ Ratio of expenses to average net assets includes fee waivers and excludes
expense reductions.
See Combined Notes to Financial Statements.
39
<PAGE>
EVERGREEN
Select Small Cap Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended June 30, Year Ended February 28,
----------------------- ----------------------------
Six Months Ended
December 31, 1999 Period Ended
(Unaudited) 1999 1998 (c) 1998 # 1997 (b) # June 30, 1996 (a)
<S> <C> <C> <C> <C> <C> <C>
CLASS I SHARES
Net asset value, beginning of
period $ 13.65 $ 13.12 $ 13.23 $ 11.28 $ 11.65 $10.00
-------- --------- --------- ------------ ----------- ------
Income from investment operations
Net investment loss (0.04) (0.08) (0.03) (0.06) (0.04) (0.03)
Net realized and unrealized gains
or losses 6.34 0.63 (0.08) 2.48 (0.16) 1.68
-------- --------- --------- ------------ ----------- ------
Total from investment operations 6.30 0.55 (0.11) 2.42 (0.20) 1.65
-------- --------- --------- ------------ ----------- ------
Distributions to shareholders from
Net realized gains 0 (0.02) 0 (0.47) (0.17) 0
-------- --------- --------- ------------ ----------- ------
Total distributions to shareholders 0 (0.02) 0 (0.47) (0.17) 0
-------- --------- --------- ------------ ----------- ------
Net asset value, end of period $ 19.95 $ 13.65 $ 13.12 $ 13.23 $ 11.28 $11.65
-------- --------- --------- ------------ ----------- ------
Total return 46.15% 4.22% (0.83%) 21.67% (1.75%) 16.50%
Ratios and supplemental data
Net assets, end of period
(thousands) $111,494 $ 70,114 $ 69,283 $ 47,524 $ 2,888 $2,446
Ratios to average net assets
Expenses++ 0.98%+ 1.02% 1.01%+ 0.92% 1.00%+ 1.00%+
Net investment loss (0.56%)+ (0.68%) (0.62%)+ (0.48%) (0.57%)+ (0.45%)+
Portfolio turnover rate 129% 165% 54% 166% 123% 57%
</TABLE>
(a) For the period from December 28, 1995 (commencement of class operations) to
June 30, 1996
(b) For the period from July 1, 1996 to February 28, 1997. The Fund changed its
fiscal year end from June 30 to February 28, effective February 28, 1997.
(c) 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.
+ Annualized
++ The ratio of expenses to average net assets includes fee waivers and
excludes expense reductions.
# Net investment loss is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
40
<PAGE>
EVERGREEN
Select Small Company Value Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Year Ended June 30,
------------------------
Six Months Ended
December 31, 1999 #
(Unaudited) 1999 1998 (a)
<S> <C> <C> <C>
CLASS I SHARES
Net asset value, beginning of
period $ 8.94 $ 10.09 $ 10.00
------- ---------- ---------
Income from investment operations
Net investment income 0.02 0.03 0.04
Net realized and unrealized gains
or losses (0.46) (1.12) 0.09
------- ---------- ---------
Total from investment operations (0.44) (1.09) 0.13
------- ---------- ---------
Distributions to shareholders
from
Net investment income (0.02) (0.03) (0.04)
------- ---------- ---------
Net realized gains 0 (0.03) 0
------- ---------- ---------
Total distributions to
shareholders (0.02) (0.06) (0.04)
------- ---------- ---------
Net asset value, end of period $ 8.48 $ 8.94 $ 10.09
------- ---------- ---------
Total return (4.93%) (10.73%) 1.28%
Ratios and supplemental data
Net assets, end of period
(thousands) $85,114 $ 108,180 $ 77,647
Ratios to average net assets
Expenses ++ 0.94%+ 0.97% 1.01%+
Net investment income 0.41%+ 0.29% 0.68%+
Portfolio turnover rate 46% 48% 23%
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended
December 31, 1999 # Period Ended
(Unaudited) June 30, 1999 (b) #
<S> <C> <C>
CLASS IS SHARES
Net asset value, beginning of
period $8.64 $8.56
----- -----
Income from investment operations
Net investment income 0.01 0
Net realized and unrealized gains
or losses (0.44) 0.08
----- -----
Total from investment operations (0.43) 0.08
----- -----
Distributions to shareholders from
Net investment income (0.01) 0
----- -----
Total distributions to
shareholders (0.01) 0
----- -----
Net asset value, end of period $8.20 $8.64
----- -----
Total return (5.06%) 0.99%
Ratios and supplemental data
Net assets, end of period
(thousands) $ 1 $ 1
Ratios to average net assets
Expenses ++ 1.19%+ 1.24%+
Net investment income 0.17%+ 0.00%+
Portfolio turnover rate 46% 48%
</TABLE>
(a) For the period from December 23,1997 (commencement of class operations) to
June 30, 1998.
(b) For the period from December 31,1998 (commencement of class operations) to
June 30, 1999.
+ Annualized
++ The ratio of expenses to average net assets includes fee waivers and
excludes expense reductions.
# Net investment income is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
41
<PAGE>
EVERGREEN
Select Social Principles Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 # ----------------------
(Unaudited) 1999 1998 (a)
<S> <C> <C> <C>
CLASS I SHARES (c)
Net asset value, beginning of
period $ 36.91 $ 38.95 $ 36.65
-------- --------- ---------
Income from investment operations
Net investment income 0.06 0.11 0.03
Net realized and unrealized gains 1.36 0.09 2.31
-------- --------- ---------
Total from investment operations 1.42 0.20 2.34
-------- --------- ---------
Distributions to shareholders
from
Net investment income (0.06) (0.14) (0.04)
Net realized gains (8.48) (2.10) 0
-------- --------- ---------
Total distributions to
shareholders (8.54) (2.24) (0.04)
-------- --------- ---------
Net asset value, end of period $ 29.79 $ 36.91 $ 38.95
-------- --------- ---------
Total return 5.53% 0.90% 6.38%
Ratios and supplemental data
Net assets, end of period
(thousands) $106,611 $ 134,476 $ 177,187
Ratios to average net assets
Expenses++ 0.82%+ 0.84% 0.86%+
Net investment income 0.37%+ 0.33% 0.12%+
Portfolio turnover rate 20% 36% 24%
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 # ----------------------
(Unaudited) 1999 1998 (b)
<S> <C> <C> <C>
CLASS IS SHARES
Net asset value, beginning of
period $ 36.86 $ 38.94 $ 38.44
-------- --------- ---------
Income from investment operations
Net investment income or loss 0.03 (0.04) (0.01)
Net realized and unrealized gains 1.34 0.14 0.52
-------- --------- ---------
Total from investment operations 1.37 0.10 0.51
-------- --------- ---------
Distributions to shareholders
from
Net investment income (0.04) (0.08) (0.01)
Net realized gains (8.48) (2.10) 0
-------- --------- ---------
Total distributions to
shareholders (8.52) (2.18) (0.01)
-------- --------- ---------
Net asset value, end of period $ 29.71 $ 36.86 $ 38.94
-------- --------- ---------
Total return 5.38% 0.64% 1.32%
Ratios and supplemental data
Net assets, end of period
(thousands) $ 52 $ 60 $ 205
Ratios to average net assets
Expenses++ 1.07%+ 1.09% 1.11%+
Net investment income or loss 0.17%+ 0.06% (0.12%)+
Portfolio turnover rate 20% 36% 24%
</TABLE>
(a) For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.
(b) For the period from March 12, 1998 (commencement of class operations) to
June 30, 1998.
(c) On April 30, 1999, Class IC shares of the Fund were converted to Class I
shares. Shareholders of Class IC shares became owners of that number of
Class I shares having a net asset value equal to the net asset value of
their shares immediately prior to the close of business on April 30, 1999.
Class IC is the accounting survivor, its basis of accounting for assets and
liabilities and its operating results for the periods prior to April 30,
1999 have been carried forward in these financial statements.
+ Annualized.
++ The ratio of expenses to average net assets includes fee waivers and
excludes expense reductions.
# Net investment income is based on average shares outstanding during the
period.
See Combined Notes to Financial Statements.
42
<PAGE>
EVERGREEN
Select Strategic Growth Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 ----------------------
(Unaudited) 1999 # 1998 (a)
<S> <C> <C> <C>
CLASS I SHARES
Net asset value, beginning of
period $ 41.94 $ 38.41 $ 32.45
-------- --------- ---------
Income from investment operations
Net investment income 0.01 0.09 0.04
Net realized and unrealized gains 14.85 6.79 5.96
-------- --------- ---------
Total from investment operations 14.86 6.88 6.00
-------- --------- ---------
Distributions to shareholders from
Net investment income (0.02) (0.09) (0.04)
Net realized gains (8.05) (3.26) 0
-------- --------- ---------
Total distributions to shareholders (8.07) (3.35) (0.04)
-------- --------- ---------
Net asset value, end of period $ 48.73 $ 41.94 $ 38.41
-------- --------- ---------
Total return 41.30% 19.22% 18.53%
Ratios and supplemental data
Net assets, end of period
(thousands) $713,032 $ 481,119 $ 321,532
Ratios to average net assets
Expenses++ 0.71%+ 0.72% 0.72%+
Net investment income 0.06%+ 0.24% 0.19%+
Portfolio turnover rate 70% 155% 80%
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 ----------------------
(Unaudited) 1999 # 1998 (b)
<S> <C> <C> <C>
CLASS IS SHARES
Net asset value, beginning of
period $ 41.83 $ 38.36 $ 36.10
-------- --------- ---------
Income from investment operations
Net investment loss (0.03) (0.01) (0.08)
Net realized and unrealized gains 14.77 6.78 2.34
-------- --------- ---------
Total from investment operations 14.74 6.77 2.26
-------- --------- ---------
Distributions to shareholders from
Net investment income 0 (0.04) 0
Net realized gains (8.05) (3.26) 0
-------- --------- ---------
Total distributions to shareholders (8.05) (3.30) 0
-------- --------- ---------
Net asset value, end of period $ 48.52 $ 41.83 $ 38.36
-------- --------- ---------
Total return 41.13% 18.88% 6.29%
Ratios and supplemental data
Net assets, end of period
(thousands) $ 18,009 $ 12,650 $ 2,373
Ratios to average net assets
Expenses++ 0.96%+ 0.97% 0.97%+
Net investment loss (0.19%)+ (0.03%) (0.27%)+
Portfolio turnover rate 70% 155% 80%
</TABLE>
(a) For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.
(b) For the period from February 27, 1998 (commencement of class operations) to
June 30, 1998.
+ Annualized.
++ The ratio of expenses to average net assets includes fee waivers and
excludes expense reductions.
# Net investment income or loss is based on average shares outstanding during
the period.
See Combined Notes to Financial Statements.
43
<PAGE>
EVERGREEN
Select Strategic Value Fund
Financial Highlights
(For a share outstanding throughout each period)
<TABLE>
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 ----------------------
(Unaudited) 1999 1998 (a)
<S> <C> <C> <C>
CLASS I SHARES
Net asset value, beginning of period $ 237.17 $ 226.02 $ 203.35
-------- --------- ---------
Income from investment operations
Net investment income 1.23 3.31 1.60
Net realized and unrealized gains or
losses (5.60) 15.66 22.67
-------- --------- ---------
Total from investment operations (4.37) 18.97 24.27
-------- --------- ---------
Distributions to shareholders from
Net investment income (1.63) (2.93) (1.60)
Net realized gains (4.19) (4.89) 0
-------- --------- ---------
Total distributions to shareholders (5.82) (7.82) (1.60)
-------- --------- ---------
Net asset value, end of period $ 226.98 $ 237.17 $ 226.02
-------- --------- ---------
Total return (1.87%) 8.85% 11.95%
Ratios and supplemental data
Net assets, end of period (thousands) $760,161 $ 530,995 $ 287,194
Ratios to average net assets
Expenses++ 0.73%+ 0.71% 0.75%+
Net investment income 1.14%+ 1.61% 1.26%+
Portfolio turnover rate 21% 41% 12%
<CAPTION>
Six Months Ended Year Ended June 30,
December 31, 1999 ----------------------
(Unaudited) 1999 1998 (b)
<S> <C> <C> <C>
CLASS IS SHARES
Net asset value, beginning of period $ 237.23 $ 226.04 $ 223.08
-------- --------- ---------
Income from investment operations
Net investment income 0.89 2.87 0.61
Net realized and unrealized gains or
losses (5.54) 15.62 3.13
-------- --------- ---------
Total from investment operations (4.65) 18.49 3.74
-------- --------- ---------
Distributions to shareholders from
Net investment income (1.37) (2.41) (0.78)
Net realized gains (4.19) (4.89) 0
-------- --------- ---------
Total distributions to shareholders (5.56) (7.30) (0.78)
-------- --------- ---------
Net asset value, end of period $ 227.02 $ 237.23 $ 226.04
-------- --------- ---------
Total return (2.00%) 8.60% 1.68%
Ratios and supplemental data
Net assets, end of period (thousands) $ 2,983 $ 1,810 $ 1,327
Ratios to average net assets
Expenses++ 0.99%+ 0.96% 1.00%+
Net investment income 0.89%+ 1.34% 0.93%+
Portfolio turnover rate 21% 41% 12%
</TABLE>
(a) For the period from November 24, 1997 (commencement of class operations) to
June 30, 1998.
(b) For the period from March 11, 1998 (commencement of class operations) to
June 30, 1998.
+ Annualized.
++ The ratio of expenses to average net assets includes fee waivers and
excludes expense redutions.
See Combined Notes to Financial Statements.
44
<PAGE>
EVERGREEN
Select Balanced Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 55.3%
Banks - 0.4%
33,260 U.S. Trust Corp. ................................... $ 2,667,036
------------
Business Equipment & Services - 0.8%
27,950 * i2 Technologies, Inc. ............................ 5,450,250
------------
Chemical & Agricultural Products - 0.6%
70,180 * Waters Corp. ..................................... 3,719,540
------------
Communication Systems & Services - 6.2%
200,240 * Cisco Systems, Inc. .............................. 21,450,710
131,320 Lucent Technologies, Inc. .......................... 9,824,377
84,525 * Powerwave Technologies, Inc. ..................... 4,934,147
57,910 * RF Micro Devices, Inc. ........................... 3,963,216
------------
40,172,450
------------
Consumer Products & Services - 1.3%
78,875 Procter & Gamble Co. ............................... 8,641,742
------------
Electrical Equipment & Services - 2.8%
79,840 General Electric Co. ............................... 12,355,240
34,325 * QLogic Corp. ..................................... 5,487,709
------------
17,842,949
------------
Electronic Equipment & Services - 1.6%
24,425 * SDL, Inc. ........................................ 5,324,650
49,285 Texas Instruments, Inc. ............................ 4,774,484
------------
10,099,134
------------
Finance & Insurance - 1.8%
59,660 AFLAC, Inc. ........................................ 2,815,206
56,715 Citigroup, Inc. .................................... 3,151,227
28,000 Federal National Mortgage Assoc. ................... 1,748,250
134,990 MBNA Corp. ......................................... 3,678,478
------------
11,393,161
------------
Food & Beverage Products - 1.8%
104,400 Anheuser Busch Companies, Inc. ..................... 7,399,350
66,075 Quaker Oats Co. .................................... 4,336,172
------------
11,735,522
------------
Healthcare Products & Services - 6.9%
133,545 Bristol-Myers Squibb Co. ........................... 8,571,920
98,575 Johnson & Johnson................................... 9,179,797
124,030 * MedQuist, Inc. ................................... 3,201,524
182,245 Medtronic, Inc. .................................... 6,640,552
121,425 Merck & Co., Inc. .................................. 8,143,064
65,935 Schering-Plough Corp. .............................. 2,781,633
76,730 Warner-Lambert Co. ................................. 6,287,064
------------
44,805,554
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Information Services & Technology - 19.3%
118,990 * America Online, Inc. ............................ $ 8,976,308
29,005 * Applied Micro Circuits Corp. .................... 3,690,886
21,075 * Broadvision, Inc. ............................... 3,584,067
22,950 * Business Objects SA.............................. 3,066,694
49,615 * CDW Computer Centers, Inc. ...................... 3,900,979
79,545 * EMC Corp. ....................................... 8,690,291
30,810 Emulex Corp. ...................................... 3,466,125
43,750 * Harmonic Lightwaves, Inc. ....................... 4,153,516
42,750 * JDS Uniphase Corp. .............................. 6,896,109
58,605 * Legato Systems, Inc. ............................ 4,032,757
76,500 * Mercury Interactive Corp. ....................... 8,257,219
177,660 * Microsoft Corp. ................................. 20,741,805
27,810 * Network Appliance, Inc. ......................... 2,309,968
35,835 * PMC-Sierra, Inc. ................................ 5,744,799
62,100 * Siebel Systems, Inc. ............................ 5,216,400
106,190 * Sun Microsystems, Inc. .......................... 8,223,088
75,380 * Synopsys, Inc. .................................. 5,031,615
81,730 * Vitesse Semiconductor Corp. ..................... 4,285,717
34,100 * Yahoo!, Inc. .................................... 14,754,644
------------
125,022,987
------------
Oil/Energy - 0.3%
43,475 Enron Corp. ....................................... 1,929,203
------------
Paper & Packaging - 1.4%
90,530 Georgia-Pacific Corp. ............................. 4,594,398
67,805 Kimberly-Clark Corp. .............................. 4,424,276
------------
9,018,674
------------
Printing, Publishing, Broadcasting &
Entertainment - 1.3%
60,345 Knight-Ridder, Inc. ............................... 3,590,527
14,500 New York Times Co., Cl. A.......................... 712,313
38,140 Omnicom Group, Inc. ............................... 3,814,000
------------
8,116,840
------------
Retailing & Wholesale - 5.5%
47,190 * Best Buy Co., Inc. .............................. 2,368,348
51,495 Circuit City Stores, Inc. ......................... 2,320,494
183,920 Family Dollar Stores, Inc. ........................ 3,000,195
136,485 Home Depot, Inc. .................................. 9,357,753
68,030 Lowe's Companies, Inc. ............................ 4,064,793
44,125 Tandy Corp. ....................................... 2,170,398
47,340 Tiffany & Co. ..................................... 4,225,095
120,225 Wal-Mart Stores, Inc. ............................. 8,310,553
------------
35,817,629
------------
Telecommunication Services & Equipment - 2.9%
42,925 * E-Tek Dynamics, Inc. ............................ 5,778,778
57,755 Nortel Networks Corp. ............................. 5,833,255
39,580 * Qualcomm, Inc. .................................. 6,971,028
------------
18,583,061
------------
</TABLE>
45
<PAGE>
EVERGREEN
Select Balanced Fund
Schedule of Investments(continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Utilities - Telephone - 0.4%
48,345 SBC Communications, Inc. ........................... $ 2,356,819
------------
Total Common Stocks (cost $259,329,379)............. 357,372,551
------------
<CAPTION>
Principal
Amount Value
<C> <S> <C>
CORPORATE BONDS - 15.3%
Aerospace & Defense - 0.9%
$ 5,371,000 Jet Equipment Trust, 144A, 9.41%, 6/15/2010......... 5,692,057
------------
Banks - 2.4%
2,302,000 Boatmen's Bancshares, Inc., 6.75%, 3/15/2003........ 2,266,784
3,836,000 First Chicago Corp., 9.875%, 8/15/2000.............. 3,916,030
7,673,000 NationsBank Corp., 7.625%, 4/15/2005................ 7,791,011
500,000 Norwest Corp.
Medium Term Note,
6.20%, 12/1/2005................................... 472,762
500,000 Republic New York Corp., 8.25%, 11/1/2001........... 507,577
500,000 United States Bancorp, 6.75%, 10/15/2005............ 485,023
------------
15,439,187
------------
Chemical & Agricultural Products - 0.9%
3,836,000 Dow Chemical Co., 8.625%, 4/1/2006.................. 4,049,692
Du Pont (E.I.) De Nemours & Co.:
1,000,000 8.50%, 2/15/2003.................................... 1,031,005
500,000 9.15%, 4/15/2000.................................... 504,171
------------
5,584,868
------------
Communication Systems & Services - 1.4%
925,000 Ameritech Capital Funding Corp., 6.55%, 1/15/2028... 804,820
9,000,000 Comcast Cable Communications I, 6.20%, 11/15/2008... 8,171,640
------------
8,976,460
------------
Consumer Products & Services - 0.5%
3,299,000 Stanley Works, 7.375%, 12/15/2002................... 3,303,883
------------
Finance & Insurance - 4.0%
500,000 Chrysler Financial Corp., 6.95%, 3/25/2002.......... 500,934
4,220,000 Dean Witter, Discover & Co., 6.75%, 10/15/2013...... 3,851,885
Ford Motor Credit Co.:
500,000 6.25%, 11/8/2000.................................... 498,415
500,000 7.50%, 1/15/2003.................................... 504,481
4,200,000 General Electric Capital Corp., 8.75%, 3/14/2003.... 4,418,404
5,000,000 Liberty Financial Cos, Inc., 7.625%, 11/15/2028.... 4,576,925
7,673,000 Loews Corp.,
6.75%, 12/15/2006................................. 7,262,264
4,336,000 Merrill Lynch, Pierce, Fenner & Smith, Inc.,
7.00%, 4/27/2008.................................. 4,179,653
------------
25,792,961
------------
Food & Beverage Products - 1.3%
3,750,000 Albertsons, Inc.,
7.45%, 8/1/2029................................... 3,572,644
750,000 Coca Cola Co.,
6.00%, 7/15/2003.................................. 722,942
3,836,000 General Mills, Inc., 9.00%, 12/20/2002............. 4,039,876
------------
8,335,462
------------
Healthcare Products & Services - 0.6%
3,836,000 Baxter International, 7.25%, 2/15/2008............. 3,758,171
------------
Industrial Specialty Products & Services - 0.1%
1,074,000 Waste Management, Inc., 8.75%, 5/1/2018............ 962,883
------------
Oil/Energy - 1.3%
3,069,000 Atlantic Richfield Co., 9.00%, 4/1/2021............ 3,493,983
5,000,000 Calenergy, Inc.,
7.52%, 9/15/2008.................................. 4,874,810
------------
8,368,793
------------
Paper & Packaging - 0.8%
5,000,000 Donohue Forest Products, Inc., 7.625%, 5/15/2007... 4,852,160
------------
Retailing & Wholesale - 0.2%
Wal Mart Stores, Inc.:
1,000,000 8.625%, 4/1/2001................................... 1,022,966
500,000 9.10%, 7/15/2000................................... 507,539
------------
1,530,505
------------
Total Corporate Bonds (cost $107,074,665).......... 92,597,390
------------
SUPRA NATIONAL - 0.3%
Finance & Insurance - 0.3%
2,110,000 International Bank for Reconstruction & Development
Co., COLTS
7.95%, 5/15/2016
(cost $2,513,130)................................. 2,223,372
------------
YANKEE OBLIGATIONS - 0.6%
3,836,000 Province of Ontario, Canada, 7.75%, 6/4/2002
(cost $4,112,729)................................. 3,901,979
------------
</TABLE>
46
<PAGE>
EVERGREEN
Select Balanced Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
U.S. GOVERNMENT & AGENCY OBLIGATIONS - 28.4%
Mortgage Pass-Through Certificates - 0.7%
Government National Mortgage Assoc.:
$ 1,002,245 8.50%, 5/15/2021.................................... $ 1,036,321
410,824 8.50%, 7/15/2021.................................... 423,192
1,082,266 8.50%, 6/15/2022.................................... 1,114,847
630,344 9.00%, 9/15/2021.................................... 660,614
711,529 9.00%, 10/15/2021................................... 745,697
436,379 9.50%, 2/15/2021.................................... 465,189
------------
4,445,860
------------
Treasury Notes & Bonds - 27.7%
U.S. Treasury Bonds:
10,420,000 7.625%, 2/15/2007................................... 10,612,124
11,300,000 7.875%, 2/15/2021................................... 12,631,287
10,500,000 8.125%, 8/15/2021................................... 12,052,036
4,500,000 8.75%, 5/15/2017.................................... 5,373,284
6,513,000 8.875%, 8/15/2017................................... 7,872,589
5,828,000 9.125%, 5/15/2018................................... 7,223,077
7,000,000 11.75%, 11/15/2014.................................. 9,467,500
U.S. Treasury Notes:
15,100,000 5.50%, 3/31/2000.................................... 15,104,726
10,000,000 5.75%, 8/15/2003.................................... 9,793,750
5,800,000 6.25%, 2/15/2003.................................... 5,783,690
7,300,000 6.625%, 3/31/2002................................... 7,352,472
4,350,000 6.625%, 4/30/2002................................... 4,382,625
15,600,000 6.875%, 5/15/2006................................... 15,877,883
14,700,000 7.25%, 5/15/2004.................................... 15,154,789
11,000,000 7.50%, 2/15/2005.................................... 11,477,818
28,373,000 7.75%, 2/15/2001.................................... 28,869,528
------------
179,029,178
------------
Total U.S. Government & Agency Obligations
(cost $189,764,118)................................ 183,475,038
------------
SHORT-TERM INVESTMENTS - 0.9%
Repurchase Agreement - 0.9%
$ 6,045,300 Cowen Securities Corp., 2.55%, dated 12/31/1999,
maturing 1/3/2000, maturity value $6,046,585
(cost $6,045,300) (a).............................. $ 6,045,300
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $562,213,462)......................... 99.9% 645,615,630
Other Assets and Liabilities - net........... 0.1 582,873
----- ------------
Net Assets................................... 100.0% $646,198,503
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by the U.S. government
and/or agency obligations based on market prices plus accrued interest at
December 31, 1999.
* Non-income producing security.
144A Security that may be sold to qualified institutional buyers under Rule
144A or security offered pursuant to Section 4(2) of the Securities Act
1933, as amended. This security has been determined to be liquid under
guidelines established by the Board of Trustees.
Summary of Abbreviations:
COLTS Continuously Offered Longer Term Securities
See Combined Notes to Financial Statements.
47
<PAGE>
EVERGREEN
Select Core Equity Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 97.4%
Aerospace & Defense - 1.1%
400,000 Honeywell International, Inc. .................... $ 23,075,000
160,000 Rockwell International Corp. ..................... 7,660,000
--------------
30,735,000
--------------
Automotive Equipment & Manufacturing - 1.6%
285,000 Arvin Industries, Inc. ........................... 8,086,875
505,000 Ford Motor Co. ................................... 26,985,938
600,000 * Tower Automotive, Inc. ......................... 9,262,500
--------------
44,335,313
--------------
Banks - 3.6%
670,000 BankAmerica Corp. ................................ 33,625,625
395,000 Chase Manhattan Corp. ............................ 30,686,562
650,710 FleetBoston Financial Corp. ...................... 22,652,842
510,000 U.S. Bancorp...................................... 12,144,375
--------------
99,109,404
--------------
Building, Construction & Furnishings - 0.3%
150,000 Deere & Co. ...................................... 6,506,250
80,000 Masco Corp. ...................................... 2,030,000
--------------
8,536,250
--------------
Chemical & Agricultural
Products - 1.2%
460,000 * Cytec Industries, Inc. ......................... 10,637,500
335,000 Du Pont (E. I.) De Nemours & Co. ................. 22,068,125
--------------
32,705,625
--------------
Communication Systems & Services - 8.8%
1,225,010 * Cisco Systems, Inc. ............................ 131,229,196
500,000 Lucent Technologies, Inc. ........................ 37,406,250
1,110,000 * MCI WorldCom, Inc. ............................. 58,899,375
200,000 * Tellabs, Inc. .................................. 12,837,500
--------------
240,372,321
--------------
Consumer Products &
Services - 2.2%
165,000 * Cendant Corp. .................................. 4,382,813
170,000 Colgate-Palmolive Co. ............................ 11,050,000
220,000 Liz Claiborne, Inc. .............................. 8,277,500
235,000 Procter & Gamble Co. ............................. 25,747,187
160,000 Whirlpool Corp. .................................. 10,410,000
--------------
59,867,500
--------------
Electrical Equipment &
Services - 6.8%
1,200,000 General Electric Co. ............................. 185,700,000
--------------
Finance & Insurance - 7.5%
170,000 Allmerica Financial Corp. ........................ 9,456,250
450,000 Allstate Corp. ................................... 10,800,000
288,750 American International Group, Inc. ............... 31,221,094
600,000 Citigroup, Inc. .................................. 33,337,500
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Finance & Insurance - continued
215,000 Federal Home Loan Mortgage Corp. ................. $ 10,118,437
300,000 Franklin Resources, Inc. ......................... 9,618,750
300,000 Hartford Financial Services Group, Inc. .......... 14,212,500
150,000 Loews Corp. ...................................... 9,103,125
105,000 Merrill Lynch & Co., Inc. ........................ 8,767,500
170,000 MGIC Investment Corp. ............................ 10,231,875
190,000 Morgan Stanley, Dean Witter & Co. ................ 27,122,500
200,000 PMI Group, Inc. .................................. 9,762,500
205,000 Radian Group, Inc. ............................... 9,788,750
190,000 XL Capital, Ltd., Cl. A........................... 9,856,250
--------------
203,397,031
--------------
Food & Beverage
Products - 3.8%
190,000 Bestfoods......................................... 9,986,875
1,000,000 Coca Cola Co. .................................... 58,250,000
240,000 * Kroger Co. ..................................... 4,530,000
580,000 Nabisco Group Holding Corp. ...................... 6,162,500
590,000 Sara Lee Corp. ................................... 13,016,875
630,000 * United States Food Service...................... 10,552,500
--------------
102,498,750
--------------
Healthcare Products &
Services - 10.3%
550,000 Abbott Laboratories............................... 19,971,875
640,000 * Amgen, Inc. .................................... 38,440,000
270,000 * Boston Scientific Corp. ........................ 5,906,250
780,000 Bristol-Myers Squibb Co. ......................... 50,066,250
145,000 * Guidant Corp. .................................. 6,815,000
239,000 Johnson & Johnson................................. 22,256,875
380,000 * Lincare Holdings, Inc. ......................... 13,181,250
370,000 Medtronic, Inc. .................................. 13,481,875
270,000 Mylan Laboratories, Inc. ......................... 6,800,625
610,000 Pfizer, Inc. ..................................... 19,786,875
550,000 Schering-Plough Corp. ............................ 23,203,125
170,000 SmithKline Beecham, PLC, ADR...................... 10,954,375
525,000 * Tenet Healthcare Corp. ......................... 12,337,500
140,000 Teva Pharmaceutical Industries, Ltd., ADR......... 10,036,250
330,000 Warner-Lambert Co. ............................... 27,039,375
--------------
280,277,500
--------------
Industrial Specialty Products & Services - 0.8%
175,000 Illinois Tool Works, Inc. ........................ 11,823,438
360,000 Trinity Industries, Inc. ......................... 10,237,500
--------------
22,060,938
--------------
Information Services & Technology - 23.1%
90,000 * Adaptec, Inc. .................................. 4,488,750
190,000 * Altera Corp. ................................... 9,416,875
400,000 * America Online, Inc. ........................... 30,175,000
220,000 * Applied Materials, Inc. ........................ 27,871,250
</TABLE>
48
<PAGE>
EVERGREEN
Select Core Equity Fund
Schedule of Investments(continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Information Services & Technology - continued
1,040,000 Compaq Computer Corp. ............................ $ 28,145,000
340,000 Computer Associates International, Inc. .......... 23,778,750
340,000 * Compuware Corp. ................................ 12,665,000
80,000 * Comverse Technology, Inc. ...................... 11,580,000
730,000 * Dell Computer Corp. ............................ 37,230,000
206,000 * EMC Corp. ...................................... 22,505,500
945,000 Intel Corp. ...................................... 77,785,312
714,000 International Business Machines Corp. ............ 77,112,000
100,000 * Legato Systems, Inc. ........................... 6,881,250
1,540,000 * Microsoft Corp. ................................ 179,795,000
390,000 * Network Associates, Inc. ....................... 10,408,125
410,000 * Oracle Systems Corp. ........................... 45,945,625
160,000 * Synopsys, Inc. ................................. 10,680,000
75,000 * Veritas Software Corp. ......................... 10,734,375
--------------
627,197,812
--------------
Iron & Steel - 0.4%
600,000 AK Steel Holding Corp. ........................... 11,325,000
--------------
Metal Products &
Services - 0.9%
175,000 Alcoa, Inc. ...................................... 14,525,000
295,000 USX United States Steel Group..................... 9,735,000
--------------
24,260,000
--------------
Oil/Energy - 5.7%
150,400 Anadarko Petroleum Corp. ......................... 5,132,400
139,200 Chevron Corp. .................................... 12,058,200
465,000 Enron Corp. ...................................... 20,634,375
622,824 Exxon Mobil Corp. ................................ 50,176,258
385,000 MCN Energy Group, Inc. ........................... 9,143,750
725,000 * Newpark Resources, Inc. ........................ 4,440,625
290,000 Texaco, Inc. ..................................... 15,750,625
470,000 Tosco Corp. ...................................... 12,778,125
195,000 Total SA, ADR..................................... 13,503,750
475,000 Ultramar Diamond Shamrock Corp. .................. 10,776,563
--------------
154,394,671
--------------
Oil Field Services - 1.2%
180,000 Diamond Offshore Drilling, Inc. .................. 5,501,250
300,000 Halliburton Co. .................................. 12,075,000
165,000 Schlumberger, Ltd. ............................... 9,281,250
171,944 Transocean Sedco Forex, Inc. ..................... 5,792,364
--------------
32,649,864
--------------
Paper & Packaging - 1.7%
240,000 Bowater, Inc. .................................... 13,035,000
340,000 Kimberly-Clark Corp. ............................. 22,185,000
210,000 * Sealed Air Corp. ............................... 10,880,625
--------------
46,100,625
--------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Printing, Publishing, Broadcasting &
Entertainment - 0.6%
215,000 Time Warner, Inc. ............................... $ 15,574,063
--------------
Real Estate - 0.8%
600,000 FelCor Lodging Trust, Inc., REIT................. 10,500,000
440,000 Simon Property Group, Inc., REIT................. 10,092,500
--------------
20,592,500
--------------
Retailing & Wholesale - 7.3%
200,000 * Best Buy Co., Inc. ............................ 10,037,500
315,000 Dayton Hudson Corp. ............................. 23,132,812
600,000 Family Dollar Stores, Inc. ...................... 9,787,500
235,000 * Federated Department Stores, Inc. ............. 11,882,188
645,000 Home Depot, Inc. ................................ 44,222,812
260,000 Lowe's Companies, Inc. .......................... 15,535,000
400,000 * Reebok International, Ltd. .................... 3,275,000
300,000 * Safeway, Inc. ................................. 10,668,750
140,000 Sears, Roebuck & Co. ............................ 4,261,250
500,000 * Toys "R" Us, Inc. ............................. 7,156,250
825,000 Wal-Mart Stores, Inc. ........................... 57,028,125
--------------
196,987,187
--------------
Telecommunication Services & Equipment - 1.7%
405,200 Bell Atlantic Corp. ............................. 24,945,125
225,000 Centurytel, Inc. ................................ 10,659,375
50,000 Nokia Corp., ADR................................. 9,500,000
--------------
45,104,500
--------------
Transportation - 1.0%
237,000 Burlington Northern Santa Fe Corp. .............. 5,747,250
350,000 * Canadian National Railway Co. ................. 9,209,375
225,000 CNF Transportation, Inc. ........................ 7,762,500
70,000 Kansas City Southern Industries, Inc. ........... 5,223,750
--------------
27,942,875
--------------
Utilities - Electric - 0.6%
290,000 CMS Energy Corp. ................................ 9,044,375
280,000 GPU, Inc. ....................................... 8,382,500
--------------
17,426,875
--------------
Utilities - Telephone - 4.4%
535,000 AT&T Corp. ...................................... 27,151,250
394,000 GTE Corp. ....................................... 27,801,625
600,000 SBC Communications, Inc. ........................ 29,250,000
200,000 Sprint Corp. .................................... 13,462,500
300,000 U.S. West, Inc. ................................. 21,600,000
--------------
119,265,375
--------------
Total Common Stocks (cost $1,750,744,273)........ 2,648,416,979
--------------
</TABLE>
49
<PAGE>
EVERGREEN
Select Core Equity Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 2.6%
Money Market Shares - 0.3%
8,637,098 Valiant General Fund.............................. $ 8,637,098
--------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Repurchase Agreement - 2.3%
$61,331,651 Cowen Securities Corp., 2.55%, dated 12/31/1999,
maturing 1/3/2000, maturity value $61,344,684
(a)............................................. $ 61,331,651
--------------
Total Short-Term Investments (cost $69,968,749).. 69,968,749
--------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -(cost $1,820,713,022)... 100.0% 2,718,385,728
Other Assets and Liabilities - net......... 0.0 278,408
----- --------------
Net Assets................................. 100.0% $2,718,664,136
===== ==============
</TABLE>
(a) The repurchase agreement is fully collateralized by the U.S.
government and/or agency obligations based on market prices plus
accrued interest at December 31,1999.
* Non-income producing security.
Summary of Abbreviations:
ADR American Depository Receipt
REIT Real Estate Investment Trust
See Combined Notes to Financial Statements.
50
<PAGE>
EVERGREEN
Select Diversified Value Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 91.7%
Automotive Equipment & Manufacturing - 2.1%
185,000 Ford Motor Co. ...................................... $ 9,885,938
45,500 * Lear Corp. ........................................ 1,456,000
------------
11,341,938
------------
Banks - 3.6%
35,000 BankAmerica Corp. ................................... 1,756,563
24,496 Chase Manhattan Corp. ............................... 1,903,033
100,000 Firstar Corp. ....................................... 2,112,500
98,000 PNC Bank Corp. ...................................... 4,361,000
160,000 SouthTrust Corp. .................................... 6,050,000
91,000 Wells Fargo Co. ..................................... 3,679,812
------------
19,862,908
------------
Building, Construction &
Furnishings - 0.6%
50,000 Deere & Co. ......................................... 2,168,750
55,000 Masco Corp. ......................................... 1,395,625
------------
3,564,375
------------
Chemical & Agricultural
Products - 1.2%
120,753 IMC Global, Inc. .................................... 1,977,330
42,271 Praxair, Inc. ....................................... 2,126,760
45,500 Waters Corp. ........................................ 2,411,500
------------
6,515,590
------------
Communication Systems &
Services - 5.5%
90,000 * Cisco Systems, Inc. ............................... 9,641,250
148,000 Lucent Technologies, Inc. ........................... 11,072,250
133,839 * MCI WorldCom, Inc. ................................ 7,101,832
34,293 * Tellabs, Inc. ..................................... 2,201,182
------------
30,016,514
------------
Consumer Products &
Services - 2.6%
93,000 Gillette Co. ........................................ 3,830,543
60,000 Maytag Corp. ........................................ 2,880,000
40,000 Procter & Gamble Co. ................................ 4,382,500
47,000 Whirlpool Corp. ..................................... 3,057,938
------------
14,150,981
------------
Diversified Companies - 1.2%
22,000 Minnesota Mining & Manufacturing Co. ................ 2,153,250
42,500 Textron, Inc. ....................................... 3,259,219
30,000 Tyco International, Ltd. ............................ 1,166,250
------------
6,578,719
------------
Electrical Equipment &
Services - 7.5%
114,000 General Electric Co. ................................ 17,641,500
140,000 Motorola, Inc. ...................................... 20,615,000
30,000 * Solectron Corp. ................................... 2,853,750
------------
41,110,250
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Electronic Equipment &
Services - 1.2%
33,000 * KLA-Tencor Corp. .................................. $ 3,675,375
31,000 Texas Instruments, Inc. ............................. 3,003,125
------------
6,678,500
------------
Finance & Insurance - 8.7%
28,000 American Express Co. ................................ 4,655,000
120,750 American International Group, Inc. .................. 13,056,094
150,000 Citigroup, Inc. ..................................... 8,334,375
53,746 Federal National Mortgage Assoc. .................... 3,355,766
77,000 Lehman Brothers Holdings, Inc. ...................... 6,520,937
58,000 MGIC Investment Corp. ............................... 3,490,875
29,500 Morgan Stanley, Dean Witter & Co. ................... 4,211,125
39,708 Nationwide Financial Services, Inc., Cl. A........... 1,109,342
30,000 Providian Financial Corp. ........................... 2,731,875
------------
47,465,389
------------
Food & Beverage Products - 2.5%
60,000 Coca Cola Co. ....................................... 3,495,000
64,000 Fortune Brands, Inc. ................................ 2,116,000
116,212 Philip Morris Companies, Inc. ....................... 2,694,666
34,700 Quaker Oats Co. ..................................... 2,277,187
73,000 * Tricon Global Restaurants, Inc. ................... 2,819,625
------------
13,402,478
------------
Healthcare Products &
Services - 9.4%
126,000 * Amgen, Inc. ....................................... 7,567,875
59,491 Bristol-Myers Squibb Co. ............................ 3,818,579
84,000 * Health Management Associates, Inc., Cl. A ......... 1,123,500
30,000 Johnson & Johnson.................................... 2,793,750
69,992 Lilly (Eli) & Co. ................................... 4,654,468
40,000 Merck & Co., Inc. ................................... 2,682,500
44,804 Monsanto Co. ........................................ 1,596,143
25,000 PE Corp-PE Biosystems Group.......................... 3,007,812
270,000 Pfizer, Inc. ........................................ 8,758,125
106,876 Pharmacia & Upjohn, Inc. ............................ 4,809,420
63,000 SmithKline Beecham, PLC, ADR......................... 4,059,562
88,000 Teva Pharmaceutical Industries, Ltd., ADR............ 6,308,500
------------
51,180,234
------------
Industrial Specialty Products & Services - 1.8%
60,000 Corning, Inc. ....................................... 7,736,250
48,000 Dover Corp. ......................................... 2,178,000
------------
9,914,250
------------
Information Services & Technology - 15.5%
25,000 * Altera Corp. ...................................... 1,239,063
100,000 * America Online, Inc. .............................. 7,543,750
23,000 * Apple Computer..................................... 2,364,687
</TABLE>
51
<PAGE>
EVERGREEN
Select Diversified Value Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Information Services & Technology - continued
65,000 * Applied Materials, Inc. .......................... $ 8,234,687
85,000 Compaq Computer Corp. .............................. 2,300,313
182,767 * Compuware Corp. .................................. 6,808,071
64,321 * EMC Corp. ........................................ 7,027,069
80,000 Intel Corp. ........................................ 6,585,000
36,100 International Business Machines Corp. .............. 3,898,800
40,000 * Legato Systems, Inc. ............................. 2,752,500
25,000 * Lexmark International Group, Inc., Cl. A.......... 2,262,500
39,700 * LSI Logic......................................... 2,679,750
40,000 * Micron Technology, Inc. .......................... 3,110,000
160,000 * Microsoft Corp. .................................. 18,680,000
90,000 * Unisys Corp. ..................................... 2,874,375
13,500 * Yahoo!, Inc. ..................................... 5,841,281
------------
84,201,846
------------
Metals & Mining - 0.3%
60,000 Newmont Mining Corp. ............................... 1,470,000
------------
Metal Products & Services - 1.1%
74,910 Alcoa, Inc. ........................................ 6,217,530
------------
Oil/Energy - 5.9%
135,000 Anadarko Petroleum Corp. ........................... 4,606,875
65,000 Atlantic Richfield Co. ............................. 5,622,500
160,000 El Paso Energy Corp. ............................... 6,210,000
93,634 Exxon Mobil Corp. .................................. 7,543,389
75,600 Total SA, ADR....................................... 5,235,300
61,600 Ultramar Diamond Shamrock Corp. .................... 1,397,550
60,455 USX Marathon Group.................................. 1,492,483
------------
32,108,097
------------
Oil Field Services - 0.9%
135,000 Tidewater, Inc. .................................... 4,860,000
------------
Paper & Packaging - 0.7%
55,000 Kimberly-Clark Corp. ............................... 3,588,750
------------
Printing, Publishing, Broadcasting & Entertainment -
2.0%
21,000 * AMFM, Inc. ....................................... 1,643,250
26,000 * CBS Corp. ........................................ 1,662,375
102,000 Time Warner, Inc. .................................. 7,388,625
------------
10,694,250
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Retailing & Wholesale - 8.2%
111,000 * Abercrombie & Fitch Co., Cl. A..................... $ 2,962,312
25,906 * Best Buy Co., Inc. ................................ 1,300,157
120,000 Circuit City Stores, Inc. ........................... 5,407,500
65,284 Dayton Hudson Corp. ................................. 4,794,294
165,000 Lowe's Companies, Inc. .............................. 9,858,750
45,000 Sears, Roebuck & Co. ................................ 1,369,688
25,000 Tandy Corp. ......................................... 1,229,688
70,000 * Toys "R" Us, Inc. ................................. 1,001,875
242,000 Wal-Mart Stores, Inc. ............................... 16,728,250
------------
44,652,514
------------
Telecommunication Services & Equipment - 3.1%
25,000 * ADC Telecommunications, Inc. ...................... 1,814,062
120,000 Centurytel, Inc. .................................... 5,685,000
40,000 Nokia Corp., ADR..................................... 7,600,000
44,919 * Qwest Communications International, Inc. .......... 1,931,517
------------
17,030,579
------------
Transportation - 0.8%
40,600 Canadian National Railway Co. ....................... 1,068,288
20,000 Delta Air Lines, Inc. ............................... 996,250
30,000 Kansas City Southern Industries, Inc. ............... 2,238,750
------------
4,303,288
------------
Utilities - Electric - 0.4%
100,800 Reliant Energy, Inc. ................................ 2,305,800
------------
Utilities - Gas - 0.3%
52,511 The Williams Companies, Inc. ........................ 1,604,867
------------
Utilities - Telephone - 4.5%
49,000 ALLTEL Corp. ........................................ 4,051,688
145,000 AT&T Corp. .......................................... 7,358,750
78,676 GTE Corp. ........................................... 5,551,575
25,000 * Nextel Communications, Inc., Cl. A................. 2,578,125
104,000 SBC Communications, Inc. ............................ 5,070,000
------------
24,610,138
------------
Total Common Stocks (cost $397,915,733).............. 499,429,785
------------
</TABLE>
52
<PAGE>
EVERGREEN
Select Diversified Value Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 1.6%
Repurchase Agreement - 1.5%
$7,875,445 Cowen Securities Corp., 2.55%, dated 12/31/1999,
maturing 1/3/2000, maturity value $7,877,119 (a)... $ 7,875,445
------------
U.S. Government Agency Obligations - 0.1%
U.S. Treasury Bills (b):
85,000 4.885%, 1/13/2000................................... 84,861
85,000 4.92%, 1/13/2000.................................... 84,861
450,000 5.08%, 2/17/2000.................................... 447,033
------------
616,755
------------
Total Short-Term Investments (cost $8,492,200)...... 8,492,200
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -(cost $406,407,933)........ 93.3% 507,921,985
Other Assets and Liabilities - net............ 6.7 36,630,602
----- ------------
Net Assets.................................... 100.0% $544,552,587
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by the U.S. govern-
ment and/or agency obligations based on market prices plus accrued
interest at December 31, 1999.
(b) At December 31, 1999, all or a portion of the principal amount of
this security was pledged to cover initial margin requirements for
open future contracts.
* Non-income producing security
Summary of Abbreviations:
ADR American Depository Receipts
FUTURES CONTRACTS - LONG POSITIONS
<TABLE>
<CAPTION>
Initial Contract Value at Unrealized
Expiration Contracts Amount December 31, 1999 Gain
----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
March 2000 25 S&P 500 Index $8,935,000 $9,276,075 $341,075
</TABLE>
See Combined Notes to Financial Statements.
53
<PAGE>
EVERGREEN
Select Large Cap Blend Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 99.9%
Automotive Equipment & Manufacturing - 1.7%
72,080 Ford Motor Co........................................... $ 3,851,775
74,830 Goodyear Tire & Rubber Co............................... 2,109,271
------------
5,961,046
------------
Banks - 5.9%
71,780 Bank One Corp........................................... 2,301,446
128,010 BankAmerica Corp. ...................................... 6,424,502
187,185 FleetBoston Financial Corp.............................. 6,516,378
94,630 Mellon Financial Corp................................... 3,223,334
19,170 Providian Financial Corp................................ 1,745,668
------------
20,211,328
------------
Communication Systems & Services - 10.7%
144,724 * Cisco Systems, Inc.................................... 15,503,559
79,130 Lucent Technologies, Inc................................ 5,919,913
252,620 * MCI WorldCom, Inc..................................... 13,404,622
31,110 * Tellabs, Inc.......................................... 1,996,873
------------
36,824,967
------------
Consumer Products & Services - 3.3%
64,990 Gillette Co............................................. 2,676,776
80,560 Procter & Gamble Co..................................... 8,826,355
------------
11,503,131
------------
Diversified Companies - 1.4%
39,780 Textron, Inc. .......................................... 3,050,629
46,640 Tyco International, Ltd................................. 1,813,130
------------
4,863,759
------------
Electrical Equipment & Services - 5.4%
113,170 General Electric Co..................................... 17,513,057
11,150 * Solectron Corp........................................ 1,060,644
------------
18,573,701
------------
Electronic Equipment & Services - 1.3%
47,280 Texas Instruments, Inc. ................................ 4,580,250
------------
Finance & Insurance - 8.9%
128,406 Allstate Corp........................................... 3,081,744
52,555 American International Group, Inc....................... 5,682,509
193,410 Citigroup, Inc.......................................... 10,746,343
125,050 Federal National Mortgage Assoc......................... 7,807,810
38,400 Merrill Lynch & Co., Inc................................ 3,206,400
------------
30,524,806
------------
Food & Beverage Products - 4.4%
62,820 Anheuser Busch Companies, Inc........................... 4,452,367
80,500 Coca Cola Co............................................ 4,689,125
66,560 * Kroger Co............................................. 1,256,320
87,340 Nabisco Holdings Corp., Cl. A........................... 2,762,128
83,060 Philip Morris Companies, Inc. .......................... 1,925,954
------------
15,085,894
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Healthcare Products & Services - 10.4%
101,320 Bristol-Myers Squibb Co................................ $ 6,503,478
46,570 Johnson & Johnson...................................... 4,336,831
49,870 Lilly (Eli) & Co. ..................................... 3,316,355
25,500 McKesson HBOC, Inc..................................... 575,344
33,870 Merck & Co., Inc....................................... 2,271,407
97,480 Monsanto Co............................................ 3,472,725
137,050 Pfizer, Inc............................................ 4,445,559
42,830 Pharmacia & Upjohn, Inc................................ 1,927,350
110,280 Warner-Lambert Co. .................................... 9,036,067
------------
35,885,116
------------
Information Services & Technology - 21.2%
15,135 * Altera Corp.......................................... 750,128
110,680 * America Online, Inc. ................................ 8,349,423
296,970 Compaq Computer Corp................................... 8,036,751
156,512 * Compuware Corp....................................... 5,830,072
144,100 * EMC Corp............................................. 15,742,925
89,182 Intel Corp. ........................................... 7,340,793
43,840 International Business Machines Corp................... 4,734,720
158,780 * Microsoft Corp....................................... 18,537,565
8,607 * Yahoo!, Inc.......................................... 3,724,141
------------
73,046,518
------------
Metal Products & Services - 2.0%
82,810 Alcoa, Inc. ........................................... 6,873,230
------------
Oil/Energy - 5.6%
150,139 Exxon Mobil Corp....................................... 12,095,573
133,130 Texaco, Inc............................................ 7,230,623
------------
19,326,196
------------
Paper & Packaging - 0.3%
21,560 International Paper Co................................. 1,216,793
------------
Printing, Publishing, Broadcasting & Entertainment -
4.9%
126,140 News Corp, Ltd......................................... 4,824,855
38,890 Omnicom Group, Inc..................................... 3,889,000
112,050 Time Warner, Inc. ..................................... 8,116,622
------------
16,830,477
------------
Retailing & Wholesale - 5.8%
146,840 Dayton Hudson Corp..................................... 10,783,563
45,400 Lowe's Companies, Inc.................................. 2,712,650
96,100 * Safeway, Inc. ....................................... 3,417,556
42,650 Wal-Mart Stores, Inc. ................................. 2,948,181
------------
19,861,950
------------
Telecommunication Services & Equipment - 1.5%
20,349 Motorola, Inc.......................................... 2,996,390
47,365 * Qwest Communications International, Inc.............. 2,036,695
------------
5,033,085
------------
</TABLE>
54
<PAGE>
EVERGREEN
Select Large Cap Blend Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Transportation - 0.4%
57,490 Burlington Northern Santa Fe Corp....................... $ 1,394,133
------------
Utilities - Electric - 1.2%
85,923 Duke Power Co........................................... 4,306,890
------------
Utilities - Telephone - 3.6%
139,920 GTE Corp. .............................................. 9,873,105
25,404 * Nextel Communications, Inc., Cl. A.................... 2,619,787
------------
12,492,892
------------
Total Common Stocks
(cost $247,368,748).................................... 344,396,162
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 1.8%
Repurchase Agreement - 1.8%
$6,157,652 Cowen Securities Corp.,
2.55%, 12/31/1999, maturing 1/3/2000, maturity
value $6,158,961
(cost $6,157,652) (a)............................. $ 6,157,652
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $253,526,400)......................... 101.7% 350,553,814
Other Assets and
Liabilities - net........................... (1.7) (5,905,970)
----- ------------
Net Assets................................... 100.0% $344,647,844
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by the U.S. government
and/or agency obligations based on market prices plus accrued interest at
December 31, 1999.
* Non-income producing security.
See Combined Notes to Financial Statements.
55
<PAGE>
EVERGREEN
Select Secular Growth Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 96.2%
Banks - 1.7%
298,400 Northern Trust Corp................................. $ 15,815,200
------------
Communication Systems & Services - 14.2%
242,100 * Exodus Communications, Inc........................ 21,501,506
370,944 * Global Crossing, Ltd.............................. 18,547,200
235,100 Level 3 Communications, Inc......................... 19,248,813
202,300 Lucent Technologies, Inc............................ 15,134,569
124,950 * MCI WorldCom, Inc................................. 6,630,159
450,600 * Metromedia Fiber Network, Inc., Cl. A............. 21,600,637
218,329 * RF Micro Devices, Inc............................. 14,941,891
589,400 Williams Communications Group....................... 17,055,763
------------
134,660,538
------------
Electrical Equipment & Services - 4.5%
76,900 * Broadcom Corp..................................... 20,945,637
141,281 General Electric Co................................. 21,863,235
------------
42,808,872
------------
Finance & Insurance - 9.4%
176,000 American Express Co................................. 29,260,000
155,142 American International Group, Inc................... 16,774,729
214,195 Federal Home Loan Mortgage Corp..................... 10,080,552
141,000 Morgan Stanley, Dean Witter & Co. .................. 20,127,750
328,100 Schwab (Charles) & Co., Inc......................... 12,590,837
------------
88,833,868
------------
Finance - 0.9%
90,468 Goldman Sachs Group, Inc............................ 8,520,955
------------
Healthcare Products & Services - 6.8%
337,200 * Amgen, Inc........................................ 20,253,075
244,000 Johnson & Johnson................................... 22,722,500
247,924 Medtronic, Inc...................................... 9,033,731
286,563 Schering-Plough Corp................................ 12,089,376
------------
64,098,682
------------
Information Services & Technology - 30.5%
242,000 * America Online, Inc. ............................. 18,255,875
123,400 * Broadvision, Inc.................................. 20,985,712
61,200 Brocade Communications Systems, Inc. ............... 10,832,400
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Information Services &
Technology - continued
239,400 * Compuware Corp.................................... $ 8,917,650
55,000 DoubleClick, Inc.................................... 13,918,437
230,900 * EMC Corp.......................................... 25,225,825
203,400 Inktomi Corp. ...................................... 18,051,750
142,800 * JDS Uniphase Corp. ............................... 23,035,425
181,000 * Legato Systems, Inc. ............................. 12,455,063
376,500 Lifeminders.com, Inc................................ 21,742,875
43,000 * Microsoft Corp.................................... 5,020,250
249,800 MP3.com, Inc. ...................................... 7,915,538
521,811 National Information Consortium, Inc................ 16,697,952
125,939 * Pfsweb, Inc. ..................................... 4,722,713
272,200 * Sun Microsystems, Inc. ........................... 21,078,487
138,300 VeriSign, Inc....................................... 26,406,656
163,000 * Veritas Software Corp. ........................... 23,329,375
22,000 * Yahoo!, Inc....................................... 9,519,125
------------
288,111,108
------------
Printing, Publishing, Broadcasting & Entertainment - 6.3%
308,100 * CBS Corp. ........................................ 19,699,144
336,600 Comcast Corp., Cl. A................................ 17,019,337
280,500 * Cox Communications, Inc., Cl. A................... 14,445,750
227,400 * Infinity Broadcasting Corp........................ 8,229,038
------------
59,393,269
------------
Retailing & Wholesale - 16.0%
305,588 * Best Buy Co., Inc. ............................... 15,336,698
317,900 * Costco Wholesale Corp............................. 29,008,375
377,800 Dayton Hudson Corp. ................................ 27,744,687
172,791 Gap, Inc............................................ 7,948,386
437,550 Home Depot, Inc..................................... 29,999,522
242,000 Tandy Corp.......................................... 11,903,375
420,600 Wal-Mart Stores, Inc. .............................. 29,073,975
------------
151,015,018
------------
Telecommunication Services & Equipment - 5.9%
220,900 * Cisco Systems, Inc................................ 23,663,913
130,738 * E-Tek Dynamics, Inc............................... 17,600,603
77,300 Nokia Corp., ADR.................................... 14,687,000
------------
55,951,516
------------
Total Common Stocks (cost $644,112,309)............. 909,209,026
------------
</TABLE>
56
<PAGE>
EVERGREEN
Select Secular Growth Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
LIMITED PARTNERSHIP - 0.2%
1,000,000 Brentwood Associates IV, LP......................... $ 981
1,000,000 Brentwood Associates V, LP.......................... 254,164
1,000,000 Brentwood Associates VI, LP......................... 1,148,192
500,000 Franklin Capital Associates, LP .................... 31,309
------------
Total Limited Partnership (cost $1,464,297)......... 1,434,646
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 2.8%
Repurchase Agreement - 2.8%
$26,653,080 Cowen Securities Corp., 2.55%, dated 12/31/1999,
maturing 1/3/2000, maturity value $26,658,744
(cost $26,653,080) (a)........................... $ 26,653,080
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $672,229,686)......................... 99.2% 937,296,752
Other Assets and Liabilities - net........... 0.8 8,010,551
----- ------------
Net Assets................................... 100.0% $945,307,303
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by the U.S. government
and/or agency obligations based on market prices plus accrued interest at
December 31, 1999.
* Non-income producing security.
Summary of Abbreviations:
ADR American Depository Receipt
See Combined Notes to Financial Statements.
57
<PAGE>
EVERGREEN
Select Small Cap Growth Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 98.5%
Building, Construction & Furnishings - 0.4%
34,100 United States Aggregates, Inc........................ $ 409,200
------------
Business Equipment &
Services - 9.2%
21,700 * Great Plains Software, Inc......................... 1,622,075
68,900 * Startek, Inc....................................... 2,497,625
63,200 * Teletech Holdings, Inc. ........................... 2,130,037
30,100 * TSI International Software, Ltd. (a)............... 1,704,413
92,600 * West Teleservices Corp............................. 2,262,912
------------
10,217,062
------------
Chemical & Agricultural
Products - 2.5%
37,700 Geon Co. ............................................ 1,225,250
51,000 Georgia Gulf Corp.................................... 1,552,313
------------
2,777,563
------------
Communication Systems &
Services - 1.4%
62,600 * Complete Busines Solutions, Inc. (a)............... 1,572,825
------------
Consumer Products &
Services - 2.3%
56,200 * Jakks Pacific, Inc................................. 1,050,238
141,700 * The Topps Company, Inc............................. 1,470,137
------------
2,520,375
------------
Education - 3.7%
59,700 * CBT Group Public, Ltd.............................. 1,999,950
67,300 * Devry, Inc......................................... 1,253,462
55,200 * ITT Educational Services, Inc...................... 852,150
------------
4,105,562
------------
Electrical Equipment &
Services - 7.9%
41,400 CMP Group, Inc....................................... 1,141,088
29,900 * Lattice Semiconductor Corp. (a).................... 1,409,038
47,900 Methode Electronics, Inc............................. 1,538,787
48,900 * Natural Microsystems Corp. (a)..................... 2,289,131
59,600 * Three-Five Systems, Inc. (a)....................... 2,443,600
------------
8,821,644
------------
Electronic Equipment &
Services - 8.1%
38,215 * Act Manufacturing, Inc............................. 1,433,063
45,200 * Kopin Corp. ....................................... 1,898,400
72,000 * LTX Corp........................................... 1,611,000
55,400 * Universal Electronics, Inc......................... 2,548,400
32,900 * Veeco Instruments, Inc. (a)........................ 1,540,131
------------
9,030,994
------------
Healthcare Products &
Services - 5.5%
94,100 * LifePoint Hospitals, Inc. (a)...................... 1,111,556
39,000 * Lynx Therapeutics, Inc. (a)........................ 1,262,625
44,300 * Molecular Devices Corp. (a)........................ 2,303,600
154,900 * PSS World Medical, Inc............................. 1,461,869
------------
6,139,650
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Industrial Specialty Products & Services - 2.1%
99,200 * Labor Ready, Inc. (a)............................. $ 1,202,800
29,000 Roper Industries, Inc............................... 1,096,563
------------
2,299,363
------------
Information Services &
Technology - 31.1%
26,500 * Advanced Digital Information...................... 1,288,563
50,100 * Advantage Learning Systems, Inc. (a).............. 560,494
11,200 * Applied Micro Circuits Corp. (a).................. 1,425,200
16,300 * Art Technology Group, Inc......................... 2,088,437
2,500 * C-bridge Internet Solutions, Inc. (a)............. 121,563
11,600 * Clarify, Inc...................................... 1,461,600
23,350 * Diamond Technology Partners, Inc. (a)............. 2,006,641
47,900 * Documentum, Inc. (a).............................. 2,868,012
25,200 * Engage Technologies, Inc. (a)..................... 1,512,000
66,400 * Kronos, Inc. (a).................................. 3,984,000
142,200 * Maxtor Corp. (a).................................. 1,030,950
21,300 * Metasolv Software, Inc. .......................... 1,741,275
25,000 * Netegrity, Inc. (a)............................... 1,423,437
4,200 * Pfsweb, Inc. (a).................................. 157,500
22,400 * Progress Software Corp............................ 1,271,200
12,988 * PSINet, Inc. (a).................................. 802,009
23,050 * QRS Corp.......................................... 2,420,250
38,300 * Remedy Corp....................................... 1,814,462
24,200 * Sandisk Corp. .................................... 2,329,250
36,000 * Spyglass, Inc. (a)................................ 1,365,188
43,600 * Unify Corp........................................ 1,193,550
24,600 * Xircom, Inc....................................... 1,845,000
------------
34,710,581
------------
Machinery - Diversified - 0.3%
55,400 Cmi Corp............................................ 391,263
------------
Manufacturing - Distributing - 1.3%
50,300 Oshkosh Truck Corp.................................. 1,474,419
------------
Oil Field Services - 1.6%
35,300 * Core Laboratories, NV (a)......................... 708,206
70,000 * Pride International, Inc.......................... 1,023,750
------------
1,731,956
------------
Printing, Publishing, Broadcasting & Entertainment -
7.3%
31,500 * Citadel Communications Corp....................... 2,043,563
36,400 * Entercom Communications Corp. (a)................. 2,402,400
78,200 * Media 100, Inc. (a)............................... 2,067,412
40,000 * Spanish Broadcasting System, Inc., Cl. A (a)...... 1,610,000
------------
8,123,375
------------
Retailing & Wholesale - 1.6%
39,400 * Whole Foods Market, Inc. (a)...................... 1,827,175
------------
</TABLE>
58
<PAGE>
EVERGREEN
Select Small Cap Growth Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Telecommunication Services & Equipment - 7.0%
74,000 * Davox Corp. (a).................................... $ 1,452,250
58,700 * ITC DeltaCom, Inc. (a)............................. 1,621,587
32,300 * Microcell Telecommunications....................... 1,061,863
47,000 * Tollgrade Communications, Inc...................... 1,621,500
38,700 * Viatel, Inc........................................ 2,075,287
------------
7,832,487
------------
Transportation - 1.6%
41,650 * Eagle USA Airfreight, Inc. (a)..................... 1,796,156
------------
Utilities - Telephone - 3.6%
49,200 * Primus Telecomm Group, Inc......................... 1,881,900
23,700 * Rural Celluar Corp., Cl. A......................... 2,144,850
------------
4,026,750
------------
Total Common Stocks
(cost $72,624,234).................................. 109,808,400
------------
SHORT-TERM INVESTMENTS - 25.0%
Money Market Shares - 23.5%
26,219,817 Navigator Prime Portfolio (b)........................ 26,219,817
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - continued
Repurchase Agreements - 1.5%
$ 1,563,000 Evergreen Joint Repurchase Agreement, 3.10%, dated
12/31/99, maturing 1/3/2000, maturity value
$1,563,404 (c).................................... $ 1,563,000
148,000 State Street Bank & Trust Co., 3.25%, dated
12/31/1999 maturing 1/3/2000, maturity
value $148,040 (c)................................ 148,000
------------
1,711,000
------------
Total Short-Term Investments
(cost $27,930,817)................................ 27,930,817
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $100,555,051)......................... 123.5% 137,739,217
Other Assets and Liabilities - net........... (23.5) (26,245,616)
----- ------------
Net Assets................................... 100.0% $111,493,601
===== ============
</TABLE>
(a) All or a portion of this security is on loan.
(b) Represents investment in cash collateral received for securities on loan.
(c) The repurchase agreement is fully collateralized by the U.S. government
and/or agency obligations based on market prices plus accrued interest at
December 31, 1999.
* Non-income producing security.
Summary of Abbreviations:
NV Naamloze Vennootschap (Dutch corporation)
See Combined Notes to Financial Statements.
59
<PAGE>
EVERGREEN
Select Small Company Value Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 100.4%
Automotive Equipment &
Manufacturing - 1.3%
40,000 Arvin Industries, Inc. .............................. $ 1,135,000
-----------
Banks - 13.1%
25,000 Britton & Koontz Capital Corp. ...................... 468,750
47,996 Charter One Financial, Inc. ......................... 917,924
105,000 * Civic Bancorp ..................................... 1,627,500
63,600 * Columbia Banking Systems, Inc. .................... 834,750
57,971 Commercial Bankshares, Inc. ......................... 1,239,119
40,000 First Oak Brook Bancshares, Inc., Cl. A.............. 740,000
30,000 First State Bancorp.................................. 412,500
28,500 Grand Premier Financial, Inc. ....................... 422,156
40,000 Granite State Bankshares, Inc. ...................... 795,000
60,000 Independent Bankshares, Inc. ........................ 832,500
46,100 Mid-State Bancshares................................. 1,469,437
15,900 * Pointe Financial Corp. ............................ 135,150
35,365 * United Security Bancorp ........................... 442,063
47,587 Washington Trust Bancorp, Inc. ...................... 844,669
-----------
11,181,518
-----------
Building, Construction &
Furnishings - 12.2%
60,000 American Woodmark Corp. ............................. 1,455,000
148,000 Craftmade International, Inc. ....................... 1,073,000
20,000 * Crossmann Communities, Inc. ....................... 310,000
20,000 D.R. Horton, Inc. ................................... 276,250
71,500 * Furniture Brands International, Inc. .............. 1,573,000
75,000 * Genlyte Group, Inc. ............................... 1,603,125
64,400 * Koala Corp. ....................................... 901,600
58,750 * Monaco Coach Corp. ................................ 1,501,797
60,900 * Stanley Furniture Co., Inc. ....................... 1,119,037
30,000 * Toll Brothers, Inc. ............................... 558,750
-----------
10,371,559
-----------
Business Equipment &
Services - 3.8%
73,000 * Interim Services, Inc. ............................ 1,806,750
50,000 * RCM Technologies, Inc. ............................ 862,500
9,000 * Zebra Technologies Corp., Cl. A.................... 526,500
-----------
3,195,750
-----------
Consumer Products &
Services - 12.0%
60,000 * Chattem, Inc. ..................................... 1,140,000
40,000 CPI Corp. ........................................... 902,500
35,000 * CSG System International, Inc. .................... 1,395,625
50,000 * Fossil, Inc. ...................................... 1,156,250
59,700 * Guess?, Inc. ...................................... 1,298,475
61,000 Industrie Natuzzi SpA, ADR........................... 808,250
45,000 Lancaster Colony Corp. .............................. 1,490,625
100,000 * Maxwell Shoe, Inc. Cl. A........................... 800,000
19,000 Polaris Industries, Inc. ............................ 688,750
116,900 Stewart Enterprises, Inc., Cl. A..................... 555,275
-----------
10,235,750
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Electrical Equipment &
Services - 1.7%
40,000 Applied Power, Inc., Cl. A.......................... $ 1,470,000
-----------
Electronic Equipment &
Services - 2.8%
22,800 * Hadco Corp. ...................................... 1,162,800
195,000 * Vicon Industries, Inc. ........................... 1,170,000
-----------
2,332,800
-----------
Finance & Insurance - 3.3%
45,500 Morgan Keegan, Inc. ................................ 764,969
70,000 Raymond James Financial, Inc. ...................... 1,308,125
27,700 Waddell & Reed Financial, Inc., Cl. A............... 751,362
-----------
2,824,456
-----------
Food & Beverage Products - 5.6%
55,000 International Multifoods Corp. ..................... 728,750
90,600 Michael Foods, Inc. ................................ 2,231,025
280,000 * Monterey Pasta Co. ............................... 1,102,500
30,000 * Performance Food Group Co. ....................... 731,250
-----------
4,793,525
-----------
Healthcare Products &
Services - 10.1%
70,000 Alpharma, Inc., Cl. A............................... 2,152,500
90,000 * AmeriSource Health Corp., Cl. A................... 1,366,875
21,000 * ArthroCare Corp. ................................. 1,281,000
29,000 Beckman Coulter, Inc. .............................. 1,475,375
77,500 * Exactech, Inc. ................................... 915,469
31,750 * Jones Pharma, Inc. ............................... 1,379,140
-----------
8,570,359
-----------
Industrial Specialty Products &
Services - 1.3%
28,600 Donaldson, Inc. .................................... 688,188
14,000 * Meade Instruments Corp. .......................... 399,000
-----------
1,087,188
-----------
Information Services &
Technology - 4.0%
23,200 * Micros Systems, Inc. ............................. 1,716,800
47,100 * SBS Technologies, Inc. ........................... 1,719,150
-----------
3,435,950
-----------
Manufacturing - Distributing - 1.7%
65,000 LSI Industries, Inc. ............................... 1,405,625
-----------
Oil/Energy - 2.1%
20,000 * Barrett Resources Corp. .......................... 588,750
45,000 Berry Petroleum Co., Cl. A.......................... 680,625
32,000 Cabot Oil & Gas Corp., Cl. A........................ 514,000
-----------
1,783,375
-----------
Printing, Publishing, Broadcasting
& Entertainment - 2.6%
97,800 Bowne & Co., Inc. .................................. 1,320,300
77,000 * Obie Media Corp. ................................. 895,125
-----------
2,215,425
-----------
</TABLE>
60
<PAGE>
EVERGREEN
Select Small Company Value Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Real Estate - 0.8%
89,600 Mission West Properties, Inc., REIT.................. $ 694,400
-----------
Retailing & Wholesale - 13.1%
40,000 * Ames Department Stores, Inc. ...................... 1,152,500
60,000 * Consolidated Stores Corp. ......................... 975,000
78,900 Freds, Inc. Cl. A.................................... 1,257,469
45,000 * Papa John's International, Inc. ................... 1,172,813
125,000 Pier 1 Imports, Inc. ................................ 796,875
95,000 Ross Stores, Inc. ................................... 1,704,062
152,700 * Sonic Automotive, Inc. ............................ 1,488,825
55,000 * Whole Foods Market, Inc. .......................... 2,550,625
-----------
11,098,169
-----------
Telecommunication Services & Equipment - 1.7%
97,400 Hickory Tech Corp.................................... 1,461,000
-----------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Thrift Institutions - 3.5%
36,000 Highland Bancorp, Inc................................ $ 684,000
75,400 Horizon Financial Corp............................... 716,300
14,200 Mech Financial, Inc.................................. 490,787
45,000 MetroWest Bank....................................... 267,188
25,000 * Monterey Bay Bancorp, Inc.......................... 253,125
32,500 * Quaker City Bancorp, Inc........................... 528,125
-----------
2,939,525
-----------
Utilities - Electric - 1.4%
61,100 MDU Resources Group, Inc............................. 1,222,000
-----------
Utilities - Gas - 2.3%
25,000 Eastern Enterprises.................................. 1,435,938
20,000 NUI Corp............................................. 527,500
-----------
1,963,438
-----------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $82,776,879).......................... 100.4% 85,416,812
Other Assets and Liabilities - net........... (0.4) (301,358)
----- -----------
Net Assets................................... 100.0% $85,115,454
===== ===========
</TABLE>
* Non-income producing security
Summary of Abbreviations:
ADR American Depository Receipt
REIT Real Estate Investment Trust
See Combined Notes to Financial Statements.
61
<PAGE>
EVERGREEN
Select Social Principles Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 98.4%
Advertising & Related Services - 2.7%
117,800 * Ha Lo Industries, Inc. ........................... $ 883,500
28,800 Young & Rubicam, Inc. .............................. 2,037,600
------------
2,921,100
------------
Aerospace & Defense - 0.5%
68,900 * BE Aerospace, Inc. ............................... 581,344
------------
Banks - 4.5%
36,716 FleetBoston Financial Corp. ........................ 1,278,176
30,600 Mellon Financial Corp. ............................. 1,042,312
54,500 SouthTrust Corp. ................................... 2,060,781
13,500 Summit Bancorp...................................... 413,438
------------
4,794,707
------------
Building, Construction & Furnishings - 2.2%
48,394 * NCI Building Systems, Inc. ....................... 895,289
27,500 Southdown, Inc. .................................... 1,419,688
------------
2,314,977
------------
Business Equipment & Services - 0.4%
30,000 * Consolidated Graphics, Inc. ...................... 448,125
------------
Communication Systems & Services - 3.9%
30,400 * Metromedia Fiber Network, Inc.,
Cl. A.............................................. 1,457,300
16,600 * NorthPoint Communications
Group, Inc. ....................................... 398,400
35,900 * Tellabs, Inc. .................................... 2,304,331
------------
4,160,031
------------
Consumer Products & Services - 1.0%
16,700 Harley-Davidson, Inc. .............................. 1,069,844
------------
Diversified Companies - 0.9%
28,800 ITT Industries, Inc. ............................... 963,000
------------
Education - 0.9%
48,300 * Apollo Group, Inc. ............................... 969,019
------------
Electrical Equipment & Services - 2.0%
18,200 Linear Technology Corp. ............................ 1,302,438
9,600 * SCI Systems, Inc. ................................ 789,000
------------
2,091,438
------------
Electronic Equipment & Services - 3.6%
57,600 * Teradyne, Inc. ................................... 3,801,600
------------
Finance & Insurance - 6.5%
16,510 AFLAC, Inc. ........................................ 779,066
39,700 Annuity & Life Re, Ltd. ............................ 1,037,162
52,300 Conseco, Inc. ...................................... 934,862
29,800 Countrywide Credit Industries, Inc. ................ 752,450
31,600 E Trade Group, Inc. ................................ 825,550
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Finance & Insurance - continued
32,710 Partnerre, Ltd. ................................... $ 1,061,031
38,800 ReliaStar Financial Corp. ......................... 1,520,475
------------
6,910,596
------------
Food & Beverage Products - 6.4%
28,700 Dean Foods Co. .................................... 1,140,825
53,900 * Keebler Foods Co. ............................... 1,515,937
23,500 McCormick & Co., Inc. ............................. 699,125
31,000 * Tricon Global Restaurants, Inc. ................. 1,197,375
133,400 * United States Food Service....................... 2,234,450
------------
6,787,712
------------
Healthcare Products & Services - 7.1%
19,700 * Biogen, Inc. .................................... 1,664,650
40,100 * Elan Corp., PLC, ADR............................. 1,182,950
198,500 * HEALTHSOUTH Corp. ............................... 1,066,938
7,100 MedImmune, Inc. ................................... 1,177,712
43,202 Mylan Laboratories, Inc. .......................... 1,088,150
55,700 * Pediatrix Medical Group, Inc. ................... 389,900
14,400 * Wellpoint Health Networks, Inc., Cl. A........... 949,500
------------
7,519,800
------------
Industrial Specialty Products & Services - 1.1%
28,400 Magna International, Inc., Cl. A................... 1,203,450
------------
Information Services & Technology - 28.0%
28,300 * Altera Corp. .................................... 1,402,619
12,600 * Citrix Systems, Inc. ............................ 1,549,800
19,350 CNET, Inc. ........................................ 1,098,113
93,100 * Compuware Corp. ................................. 3,467,975
12,420 * JDS Uniphase Corp. .............................. 2,003,501
43,000 * PMC-Sierra, Inc. ................................ 6,893,437
25,300 * PSINet, Inc. .................................... 1,562,275
31,100 * Sanmina Corp. ................................... 3,106,113
29,000 * Siebel Systems, Inc. ............................ 2,436,000
44,475 * Veritas Software Corp. .......................... 6,365,484
------------
29,885,317
------------
Oil/Energy - 4.6%
47,900 El Paso Energy Corp. .............................. 1,859,119
232,400 * Newpark Resources, Inc. ......................... 1,423,450
71,300 Ultramar Diamond Shamrock Corp. ................... 1,617,619
------------
4,900,188
------------
Paper & Packaging - 1.1%
79,400 Rock Tennessee Co., Cl. A.......................... 1,171,150
------------
Pharmaceuticals - 0.9%
23,600 Chiron Corp. ...................................... 1,000,050
------------
Printing, Publishing, Broadcasting &
Entertainment - 1.2%
12,600 Omnicom Group, Inc. ............................... 1,260,000
------------
</TABLE>
62
<PAGE>
EVERGREEN
Select Social Principles Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Real Estate - 0.9%
54,100 FelCor Lodging Trust, Inc., REIT.................... $ 946,749
------------
Retailing & Wholesale - 8.3%
17,160 * Abercrombie & Fitch Co., Cl. A.................... 457,958
71,026 * Best Buy Co., Inc. ............................... 3,564,617
4,150 Circuit City Stores, Inc. .......................... 187,009
105,000 Family Dollar Stores, Inc. ......................... 1,712,812
125,100 * Saks, Inc. ....................................... 1,946,869
42,200 * Starbucks Corp. .................................. 1,023,350
------------
8,892,615
------------
Telecommunication Services & Equipment - 5.2%
24,220 Crown Castle International Corp. ................... 778,067
89,900 * Qwest Communications International, Inc. ......... 3,865,700
6,400 Voicestream Wireless Corp. ......................... 910,800
------------
5,554,567
------------
Utilities - Electric - 4.5%
71,300 Cinergy Corp. ...................................... 1,720,113
73,428 Sierra Pacific Resources New........................ 1,271,222
95,600 UtiliCorp United, Inc. ............................. 1,858,225
------------
4,849,560
------------
Total Common Stocks
(cost $82,877,279)................................. 104,996,939
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 4.6%
Repurchase Agreement - 4.6%
$4,863,609 Cowen Securities Corp., 2.55%, dated 12/31/1999,
maturing 1/3/2000, maturity value $4,864,643
(cost $4,863,609) (a)............................. $ 4,863,609
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments - (cost $87,740,888)....... 103.0% 109,860,548
Other Assets and Liabilities - net........... (3.0) (3,197,623)
----- ------------
Net Assets................................... 100.0% $106,662,925
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by the U.S. government
and/or agency obligations based on market prices plus accrued interest at
December 31, 1999.
* Non-income producing security.
Summary of Abbreviations:
ADR American Depository Receipt
REIT Real Estate Investment Trust
See Combined Notes to Financial Statements.
63
<PAGE>
EVERGREEN
Select Strategic Growth Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 96.9%
Banks - 0.7%
65,475 U.S. Trust Corp. ................................... $ 5,250,277
------------
Business Equipment &
Services - 1.5%
56,775 i2 Technologies, Inc. .............................. 11,071,125
------------
Chemical & Agricultural
Products - 1.1%
153,550 Waters Corp. ....................................... 8,138,150
------------
Communication Systems & Services - 10.8%
394,200 * Cisco Systems, Inc. .............................. 42,228,675
258,525 Lucent Technologies, Inc. .......................... 19,340,901
166,400 * Powerwave Technologies, Inc. ..................... 9,713,600
114,000 RF Micro Devices, Inc. ............................. 7,801,875
------------
79,085,051
------------
Consumer Products &
Services - 2.4%
160,175 Procter & Gamble Co. ............................... 17,549,173
------------
Electrical Equipment
& Services - 4.8%
157,175 General Electric Co. ............................... 24,322,831
67,575 * QLogic Corp. ..................................... 10,803,553
------------
35,126,384
------------
Electronic Equipment &
Services - 2.8%
49,575 SDL, Inc. .......................................... 10,807,350
97,025 Texas Instruments, Inc. ............................ 9,399,297
------------
20,206,647
------------
Finance & Insurance - 3.1%
117,450 AFLAC, Inc. ........................................ 5,542,172
111,650 Citigroup, Inc. .................................... 6,203,553
55,125 Federal National Mortgage Assoc. ................... 3,441,867
265,759 MBNA Corp. ......................................... 7,241,933
------------
22,429,525
------------
Food & Beverage Products - 3.2%
205,525 Anheuser Busch Companies, Inc. ..................... 14,566,585
134,175 Quaker Oats Co. .................................... 8,805,234
------------
23,371,819
------------
Healthcare Products &
Services - 12.2%
262,900 Bristol-Myers Squibb Co. ........................... 16,874,894
200,175 Johnson & Johnson................................... 18,641,297
244,175 * MedQuist, Inc. ................................... 6,302,767
358,775 Medtronic, Inc. .................................... 13,072,864
246,575 Merck & Co., Inc. .................................. 16,535,936
129,800 Schering-Plough Corp. .............................. 5,475,938
151,050 Warner-Lambert Co. ................................. 12,376,659
------------
89,280,355
------------
Information Services &
Technology - 33.8%
234,250 * America Online, Inc. ............................. 17,671,234
57,100 * Applied Micro Circuits Corp. ..................... 7,265,975
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Information Services &
Technology - continued
40,780 * Broadvision, Inc. ............................... $ 6,935,149
45,180 Business Objects SA................................ 6,037,178
97,675 CDW Computer Centers, Inc. ........................ 7,679,697
156,600 * EMC Corp. ....................................... 17,108,550
60,650 Emulex Corp. ...................................... 6,823,125
86,125 Harmonic Lightwaves, Inc. ......................... 8,176,492
86,800 * JDS Uniphase Corp. .............................. 14,001,925
115,375 * Legato Systems, Inc. ............................ 7,939,242
150,600 * Mercury Interactive Corp. ....................... 16,255,388
349,750 * Microsoft Corp. ................................. 40,833,312
54,750 * Network Appliance, Inc. ......................... 4,547,672
70,550 * PMC-Sierra, Inc. ................................ 11,310,047
119,805 Siebel Systems, Inc. .............................. 10,063,620
209,050 * Sun Microsystems, Inc. .......................... 16,188,309
148,400 * Synopsys, Inc. .................................. 9,905,700
160,900 * Vitesse Semiconductor Corp. ..................... 8,437,194
69,250 * Yahoo!, Inc. .................................... 29,963,609
------------
247,143,418
------------
Oil/Energy - 0.5%
84,900 Enron Corp. ....................................... 3,767,437
------------
Paper & Packaging - 2.4%
178,225 Georgia-Pacific Corp. ............................. 9,044,919
133,485 Kimberly-Clark Corp. .............................. 8,709,896
------------
17,754,815
------------
Printing, Publishing, Broadcasting &
Entertainment - 2.2%
118,801 Knight-Ridder, Inc. ............................... 7,068,659
28,542 New York Times Co., Cl. A ......................... 1,402,126
74,200 Omnicom Group, Inc. ............................... 7,420,000
------------
15,890,785
------------
Retailing & Wholesale - 9.7%
92,900 * Best Buy Co., Inc. .............................. 4,662,419
101,375 Circuit City Stores, Inc. ......................... 4,568,211
362,075 Family Dollar Stores, Inc. ........................ 5,906,348
268,688 Home Depot, Inc. .................................. 18,421,887
133,925 Lowe's Companies, Inc. ............................ 8,002,019
86,862 Tandy Corp. ....................................... 4,272,525
93,200 Tiffany & Co. ..................................... 8,318,100
236,675 Wal-Mart Stores, Inc. ............................. 16,360,159
------------
70,511,668
------------
Telecommunication Services & Equipment - 5.1%
87,175 E-Tek Dynamics, Inc. .............................. 11,735,934
113,700 Nortel Networks Corp. ............................. 11,483,700
77,900 * Qualcomm, Inc. .................................. 13,720,138
------------
36,939,772
------------
Utilities - Telephone - 0.6%
95,175 SBC Communications, Inc. .......................... 4,639,781
------------
Total Common Stocks
(cost $445,804,262)............................... 708,156,182
------------
</TABLE>
64
<PAGE>
EVERGREEN
Select Strategic Growth Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 2.5%
Money Market Shares - 0.0%
192,812 Valiant General Fund................................ $ 192,812
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<S> <C> <C>
Repurchase Agreement - 2.5%
$18,491,401 Cowen Securities Corp., 2.55%, dated
12/31/1999, maturing 1/3/2000,
maturity value $18,495,330 (a)..................... $ 18,491,401
------------
Total Short-Term Investments
(cost $18,684,213)................................. 18,684,213
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $464,488,475)......................... 99.4% 726,840,395
Other Assets and Liabilities - net........... 0.6 4,200,161
----- ------------
Net Assets................................... 100.0% $731,040,556
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by the U.S. government
and/or agency obligations based on market prices plus accrued interest at
December 31, 1999.
* Non-income producing security.
See Combined Notes to Financial Statements.
65
<PAGE>
EVERGREEN
Select Strategic Value Fund
Schedule of Investments
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - 94.6%
Automotive Equipment & Manufacturing - 1.0%
230,100 * Lear Corp. ....................................... $ 7,363,200
------------
Banks - 12.3%
245,700 BankAmerica Corp. .................................. 12,331,069
341,400 Chase Manhattan Corp. .............................. 26,522,512
662,600 Mellon Financial Corp. ............................. 22,569,813
278,500 SouthTrust Corp. ................................... 10,530,781
539,100 Wells Fargo Co. .................................... 21,799,856
------------
93,754,031
------------
Chemical & Agricultural
Products - 2.3%
634,600 Hercules, Inc. ..................................... 17,689,475
------------
Consumer Products &
Services - 5.4%
499,900 Black & Decker Corp. ............................... 26,119,775
309,000 Maytag Corp. ....................................... 14,832,000
------------
40,951,775
------------
Electronic Equipment &
Services - 4.2%
165,184 Koninklijke (Royal) Philips Electronics, NV, ADR.... 22,299,840
152,015 * Teradyne, Inc. ................................... 10,032,990
------------
32,332,830
------------
Finance & Insurance - 9.5%
174,000 Allstate Corp. ..................................... 4,176,000
424,700 Citigroup, Inc. .................................... 23,597,394
371,900 Countrywide Credit Industries, Inc. ................ 9,390,475
138,700 Loews Corp. ........................................ 8,417,356
269,400 Merrill Lynch & Co., Inc. .......................... 22,494,900
144,100 Nationwide Financial Services, Inc.,
Cl. A.............................................. 4,025,794
------------
72,101,919
------------
Food & Beverage Products - 3.3%
391,700 McDonald's Corp. ................................... 15,790,407
411,500 Philip Morris Companies, Inc. ...................... 9,541,656
------------
25,332,063
------------
Healthcare Products &
Services - 4.5%
315,900 Bristol-Myers Squibb Co. ........................... 20,276,831
613,900 * Tenet Healthcare Corp. ........................... 14,426,650
------------
34,703,481
------------
Information Services &
Technology - 3.4%
92,400 Intel Corp. ........................................ 7,605,675
170,300 International Business Machines Corp. .............. 18,392,400
------------
25,998,075
------------
</TABLE>
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
COMMON STOCKS - continued
Metal Products & Services - 5.8%
396,800 Alcoa, Inc. ....................................... $ 32,934,400
334,200 USX United States Steel Group...................... 11,028,600
------------
43,963,000
------------
Oil/Energy - 12.8%
295,000 Burlington Resources, Inc. ........................ 9,753,437
190,100 El Paso Energy Corp. .............................. 7,378,256
349,822 Exxon Mobil Corp. ................................. 28,182,535
307,500 Texaco, Inc. ...................................... 16,701,094
716,500 Tosco Corp. ....................................... 19,479,844
297,600 Ultramar Diamond Shamrock Corp. ................... 6,751,800
380,000 USX Marathon Group................................. 9,381,250
------------
97,628,216
------------
Paper & Packaging - 3.2%
554,400 Mead Corp. ........................................ 24,081,750
------------
Printing, Publishing, Broadcasting &
Entertainment - 3.0%
786,100 Disney (Walt) Co. ................................. 22,993,425
------------
Real Estate - 0.5%
201,200 FelCor Lodging Trust, Inc., REIT................... 3,521,000
------------
Retailing & Wholesale - 2.6%
333,500 Lowe's Companies, Inc. ............................ 19,926,625
------------
Telecommunication Services & Equipment - 8.2%
504,800 Centurytel, Inc. .................................. 23,914,900
154,600 Motorola, Inc. .................................... 22,764,850
85,200 Nokia Corp., ADR................................... 16,188,000
------------
62,867,750
------------
Utilities - Gas - 3.7%
359,500 NICOR, Inc. ....................................... 11,683,750
543,700 The Williams Companies, Inc. ...................... 16,616,831
------------
28,300,581
------------
Utilities - Telephone - 8.9%
229,500 ALLTEL Corp. ...................................... 18,976,780
491,000 AT&T Corp. ........................................ 24,918,250
344,700 GTE Corp. ......................................... 24,322,894
------------
68,217,924
------------
Total Common Stocks
(cost $650,563,156)............................... 721,727,120
------------
PREFERRED STOCKS - 1.4%
Printing, Publishing, Broadcasting &
Entertainment - 1.4%
314,700 News Corp., Ltd.
(cost $7,860,011) ................................ 10,522,782
------------
</TABLE>
66
<PAGE>
EVERGREEN
Select Strategic Value Fund
Schedule of Investments (continued)
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Shares Value
<C> <S> <C>
SHORT-TERM INVESTMENTS - 3.8%
Money Market Shares - 0.4%
3,321,071 Valiant General Fund ............................... $ 3,321,071
------------
</TABLE>
<TABLE>
<CAPTION>
Principal
Amount Value
<C> <S> <C>
Repurchase Agreement - 3.4%
$26,216,748 Cowen Securities Corp., 2.55%,
dated 12/31/1999, maturing
1/3/2000, maturity value
$26,222,319 (a).................................... $ 26,216,748
------------
Total Short-Term Investments
(cost $29,537,819)................................. 29,537,819
------------
</TABLE>
<TABLE>
<C> <S> <C> <C>
Total Investments -
(cost $687,960,986)......................... 99.8% 761,787,721
Other Assets and Liabilities - net........... 0.2 1,355,833
----- ------------
Net Assets................................... 100.0% $763,143,554
===== ============
</TABLE>
(a) The repurchase agreement is fully collateralized by the U.S. government
and/or agency obligations based on market prices plus accrued interest at
December 31, 1999.
* Non-income producing security.
Summary of Abbreviations:
ADR American Depository Receipt
NV Naamloze Vennootschap (Dutch corporation)
REIT Real Estate Investment Trust
See Combined Notes to Financial Statements.
67
<PAGE>
EVERGREEN
Select Equity Funds
Statements of Assets and Liabilities
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Diversified Large Cap Secular
Balanced Core Equity Value Blend Growth
Fund Fund Fund Fund Fund
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets
Identified cost of
securities............ $562,213,462 $1,820,713,022 $406,407,933 $253,526,400 $672,229,686
Net unrealized gains on
securities............ 83,402,168 897,672,706 101,514,052 97,027,414 265,067,066
- ----------------------------------------------------------------------------------------------
Market value of
securities............ 645,615,630 2,718,385,728 507,921,985 350,553,814 937,296,752
Cash................... 2,241 0 0 0 1,696,056
Receivable for
securities sold....... 380,304 0 36,472,959 0 14,824,140
Receivable for Fund
shares sold........... 51,376 853,954 41,747 0 6,434
Dividends and interest
receivable............ 5,344,872 2,271,074 487,207 343,538 127,845
Receivable for daily
variation margin on
open futures
contracts............. 0 0 21,250 0 0
Deferred organization
expenses.............. 0 0 0 0 0
Prepaid expenses and
other assets.......... 2,603 14,899 25,825 26,137 28,083
- ----------------------------------------------------------------------------------------------
Total assets........... 651,397,026 2,721,525,655 544,970,973 350,923,489 953,979,310
- ----------------------------------------------------------------------------------------------
Liabilities
Distributions payable.. 667,475 0 20,197 100,428 0
Payable for securities
purchased............. 0 0 0 0 7,784,880
Payable for Fund shares
redeemed.............. 4,081,399 893,511 68,575 5,915,042 161,671
Payable for securities
on loan............... 0 0 0 0 0
Due to custodian bank.. 0 0 0 0 0
Advisory fee payable... 277,030 1,594,631 225,810 189,414 446,808
Distribution Plan
expenses payable...... 8 746 9 134 1
Due to other related
parties............... 11,701 50,067 10,108 6,791 16,926
Accrued expenses and
other liabilities..... 160,910 322,564 93,687 63,836 261,721
- ----------------------------------------------------------------------------------------------
Total liabilities...... 5,198,523 2,861,519 418,386 6,275,645 8,672,007
- ----------------------------------------------------------------------------------------------
Net assets.............. $646,198,503 $2,718,664,136 $544,552,587 $344,647,844 $945,307,303
- ----------------------------------------------------------------------------------------------
Net assets represented
by
Paid-in capital........ $539,076,474 $1,758,585,466 $426,101,911 $236,564,477 $602,775,902
Undistributed
(overdistributed) net
investment income or
loss.................. (67,625) 807,508 42,516 5,027 (642,815)
Accumulated net
realized gains or
losses on securities
and futures
contracts............. 23,787,486 61,598,456 16,553,033 11,050,926 78,107,150
Net unrealized gains on
securities and futures
contracts............. 83,402,168 897,672,706 101,855,127 97,027,414 265,067,066
- ----------------------------------------------------------------------------------------------
Total net assets........ $646,198,503 $2,718,664,136 $544,552,587 $344,647,844 $945,307,303
- ----------------------------------------------------------------------------------------------
Net assets consists of
Class I................ $645,160,940 $2,671,204,314 $543,139,434 $344,218,930 $945,226,365
Class IS............... 1,037,563 47,459,822 1,413,153 428,914 80,938
- ----------------------------------------------------------------------------------------------
Total net assets....... $646,198,503 $2,718,664,136 $544,552,587 $344,647,844 $945,307,303
- ----------------------------------------------------------------------------------------------
Shares outstanding
Class I................ 45,079,474 29,734,719 19,096,865 7,948,714 6,480,308
Class IS............... 72,288 567,600 50,300 9,913 556
- ----------------------------------------------------------------------------------------------
Net asset value per
share
Class I................ $ 14.31 $ 89.83 $ 28.44 $ 43.30 $ 145.86
- ----------------------------------------------------------------------------------------------
Class IS............... $ 14.35 $ 83.61 $ 28.09 $ 43.27 $ 145.57
- ----------------------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
68
<PAGE>
EVERGREEN
Select Equity Funds
Statements of Assets and Liabilities
December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Small Cap Small Company Social Strategic Strategic
Growth Value Principles Growth Value
Fund Fund Fund Fund Fund
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Assets
Identified cost of
securities............ $100,555,051 $82,776,879 $ 87,740,888 $464,488,475 $687,960,986
Net unrealized gains on
securities............ 37,184,166 2,639,933 22,119,660 262,351,920 73,826,735
- ---------------------------------------------------------------------------------------------
Market value of
securities............ 137,739,217 85,416,812 109,860,548 726,840,395 761,787,721
Cash................... 330 0 0 3,625 0
Receivable for
securities sold....... 11,011 562,179 0 666,585 0
Receivable for Fund
shares sold........... 34,025 0 0 4,507,824 4,267,001
Dividends and interest
receivable............ 5,251 101,467 88,571 252,973 1,057,689
Receivable for daily
variation margin on
open futures
contracts............. 0 0 0 0 0
Deferred organization
expenses.............. 3,921 0 0 0 0
Prepaid expenses and
other assets.......... 11,689 27,299 11,393 21,813 32,144
- ---------------------------------------------------------------------------------------------
Total assets......... 137,805,444 86,107,757 109,960,512 732,293,215 767,144,555
- ---------------------------------------------------------------------------------------------
Liabilities
Distributions payable.. 0 17,751 0 0 437,200
Payable for securities
purchased............. 0 383,958 0 0 2,781,525
Payable for Fund shares
redeemed.............. 0 271,000 3,216,471 779,024 125,831
Payable for securities
on loan............... 26,219,817 0 0 0 0
Due to custodian bank.. 0 235,455 0 0 0
Advisory fee payable... 68,826 59,972 70,006 400,036 471,360
Distribution Plan
expenses payable...... 0 0 0 122 20
Due to other related
parties............... 0 1,936 1,952 14,511 20,117
Accrued expenses and
other liabilities..... 23,200 22,231 9,158 58,966 164,948
- ---------------------------------------------------------------------------------------------
Total liabilities.... 26,311,843 992,303 3,297,587 1,252,659 4,001,001
- ---------------------------------------------------------------------------------------------
Net assets.............. $111,493,601 $85,115,454 $106,662,925 $731,040,556 $763,143,554
- ---------------------------------------------------------------------------------------------
Net assets represented
by
Paid-in capital........ $ 71,224,547 $99,878,337 $ 78,022,790 $425,177,634 $680,029,743
Undistributed
(overdistributed) net
investment income or
loss.................. (220,306) (8,535) 9,227 (89,568) 42,890
Accumulated net
realized gains or
losses on securities
and futures
contracts............. 3,305,194 (17,394,281) 6,511,248 43,600,570 9,244,186
Net unrealized gains on
securities and futures
contracts............. 37,184,166 2,639,933 22,119,660 262,351,920 73,826,735
- ---------------------------------------------------------------------------------------------
Total net assets..... $111,493,601 $85,115,454 $106,662,925 $731,040,556 $763,143,554
- ---------------------------------------------------------------------------------------------
Net assets consists of
Class I................ $111,493,601 $85,114,462 $106,611,192 $713,031,377 $760,160,961
Class IS............... 0 992 51,733 18,009,179 2,982,593
- ---------------------------------------------------------------------------------------------
Total net assets....... $111,493,601 $85,115,454 $106,662,925 $731,040,556 $763,143,554
- ---------------------------------------------------------------------------------------------
Shares outstanding
Class I................ 5,588,479 10,037,070 3,578,768 14,631,487 3,348,948
Class IS............... 0 121 1,741 371,132 13,138
- ---------------------------------------------------------------------------------------------
Net asset value per
share
Class I................ $ 19.95 $ 8.48 $ 29.79 $ 48.73 $ 226.98
- ---------------------------------------------------------------------------------------------
Class IS............... -- $ 8.20 $ 29.71 $ 48.52 $ 227.02
- ---------------------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
69
<PAGE>
EVERGREEN
Select Equity Funds
Statements of Operations
Six Months Ended December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Diversified Large Cap Secular
Balanced Core Equity Value Blend Growth
Fund Fund Fund Fund Fund
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment income
Dividends (net of
foreign withholding
taxes of $1,249,
$38,187, $8,170, $885,
$0, $0, $0, $2,171,
$639, $4,332,
respectively)......... $ 1,628,644 $ 13,538,474 $ 3,079,679 $ 2,245,336 $ 896,085
Securities lending
income................ 0 0 0 0 196,594
Interest............... 10,970,314 1,904,338 117,322 149,086 799,783
- --------------------------------------------------------------------------------------------
Total investment
income................. 12,598,958 15,442,812 3,197,001 2,394,422 1,892,462
- --------------------------------------------------------------------------------------------
Expenses
Advisory fee........... 2,035,575 8,865,278 1,675,648 1,360,501 2,544,933
Distribution Plan
expenses.............. 880 44,346 1,652 488 17
Administrative services
fee................... 77,121 287,615 63,478 44,215 82,340
Transfer agent fee..... 190,529 9,811 110,635 182 704
Trustees' fees and
expenses.............. 6,740 26,812 5,684 3,936 5,822
Printing and postage
expenses.............. 17,481 65,301 14,460 10,127 17,928
Custodian fee.......... 105,865 325,846 44,337 42,741 106,490
Registration and filing
fees.................. 46,648 66,266 22,832 16,715 213,468
Professional fees...... 9,740 12,891 8,820 8,237 9,798
Organization expenses.. 0 0 0 0 0
Other.................. 86,094 50,204 46,674 44,445 3,139
- --------------------------------------------------------------------------------------------
Total expenses....... 2,576,673 9,754,370 1,994,220 1,531,587 2,984,639
Less: Expense
reductions.......... (13,487) (52,784) (11,480) (8,152) (14,080)
Fee waivers........ (339,262) (924,281) (263,730) (171,420) (425,608)
- --------------------------------------------------------------------------------------------
Net expenses........... 2,223,924 8,777,305 1,719,010 1,352,015 2,544,951
- --------------------------------------------------------------------------------------------
Net investment income
or loss............... 10,375,034 6,665,507 1,477,991 1,042,407 (652,489)
- --------------------------------------------------------------------------------------------
Net realized and
unrealized gains or
losses on securities
and futures contracts
Net realized gains or
losses on:
Securities............. 47,925,140 66,866,599 18,891,871 25,848,525 99,416,584
Futures contracts...... 0 (4,246,425) 466,175 0 0
- --------------------------------------------------------------------------------------------
Net realized gains or
losses on securities
and futures
contracts............. 47,925,140 62,620,174 19,358,104 25,848,525 99,416,584
- --------------------------------------------------------------------------------------------
Net change in
unrealized gains or
losses on securities
and futures
contracts............. 9,868,119 120,962,603 14,453,323 (16,457,354) 196,431,202
- --------------------------------------------------------------------------------------------
Net realized and
unrealized gains or
losses on securities
and futures
contracts............. 57,793,259 183,582,777 33,811,427 9,391,171 295,847,786
- --------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from
operations............ $68,168,293 $190,248,284 $35,289,418 $10,433,578 $295,195,297
- --------------------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
70
<PAGE>
EVERGREEN
Select Equity Fund
Statements of Operations
Six Months Ended December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Small Cap Small Company Social Strategic
Growth Value Principles Strategic Growth Value
Fund Fund Fund Fund Fund
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Investment income
Dividends (net of
foreign withholding
taxes of $1,249,
$38,187, $8,170, $885,
$0, $0, $0, $2,171,
$639, $4,332,
respectively)......... $ 64,224 $ 563,649 $ 568,999 $ 1,341,773 $ 5,707,014
Securities lending
income................ 48,178 0 0 0 0
Interest............... 48,794 107,853 97,450 793,568 728,961
- ----------------------------------------------------------------------------------------------
Total investment
income................. 161,196 671,502 666,449 2,135,341 6,435,975
- ----------------------------------------------------------------------------------------------
Expenses
Advisory fee........... 313,675 450,171 450,630 1,967,647 2,405,518
Distribution Plan
expenses.............. 0 5 82 17,559 2,871
Administrative services
fee................... 4,743 11,377 12,816 63,816 78,033
Transfer agent fee..... 998 204 182 36,659 19,930
Trustees' fees and
expenses.............. 726 1,021 971 4,822 6,818
Printing and postage
expenses.............. 1,888 2,626 3,119 12,994 17,928
Custodian fee.......... 9,488 13,222 10,459 36,588 89,773
Registration and filing
fees.................. 31,840 13,463 4,721 13,724 91,361
Professional fees...... 7,655 8,789 7,794 9,175 9,798
Organization expenses.. 2,011 0 0 0 0
Other.................. 11,956 8,688 3,252 3,636 3,117
- ----------------------------------------------------------------------------------------------
Total expenses....... 384,980 509,566 494,026 2,166,620 2,725,147
Less: Expense
reductions.......... (3,478) (3,970) (1,966) (12,865) (14,164)
Fee waivers........ 0 (37,167) (31,950) (168,384) (196,718)
- ----------------------------------------------------------------------------------------------
Net expenses......... 381,502 468,429 460,110 1,985,371 2,514,265
- ----------------------------------------------------------------------------------------------
Net investment income
or loss............... (220,306) 203,073 206,339 149,970 3,921,710
- ----------------------------------------------------------------------------------------------
Net realized and
unrealized gains or
losses on securities
and futures contracts
Net realized gains or
losses on:
Securities........... 7,724,216 (8,869,649) 13,379,755 73,538,856 9,684,294
Futures contracts.... 0 0 0 0 0
- ----------------------------------------------------------------------------------------------
Net realized gains or
losses on securities
and futures
contracts............. 7,724,216 (8,869,649) 13,379,755 73,538,856 9,684,294
- ----------------------------------------------------------------------------------------------
Net change in
unrealized gains or
losses on securities
and futures
contracts............. 27,399,552 2,639,016 (9,293,541) 139,358,357 (22,587,449)
- ----------------------------------------------------------------------------------------------
Net realized and
unrealized gains or
losses on securities
and futures
contracts............. 35,123,768 (6,230,633) 4,086,214 212,897,213 (12,903,155)
- ----------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from
operations............ $34,903,462 $(6,027,560) $4,292,553 $213,047,183 $(8,981,445)
- ----------------------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
71
<PAGE>
EVERGREEN
Select Equity Funds
Statements of Changes in Net Assets
Six Months Ended December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Diversified Large Cap Secular
Balanced Core Equity Value Blend Growth
Fund Fund Fund Fund Fund
- -----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operations
Net investment income
or loss............... $ 10,375,034 $ 6,665,507 $ 1,477,991 $ 1,042,407 $ (652,489)
Net realized gains or
losses on securities
and futures
contracts............. 47,925,140 62,620,174 19,358,104 25,848,525 99,416,584
Net change in
unrealized gains or
losses on securities
and futures
contracts............. 9,868,119 120,962,603 14,453,323 (16,457,354) 196,431,202
- -----------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from
operations............ 68,168,293 190,248,284 35,289,418 10,433,578 295,195,297
- -----------------------------------------------------------------------------------------------------
Distributions to
shareholders from
Net investment income
Class I................ (12,050,262) (5,868,238) (1,847,289) (1,028,536) (1,204)
Class IS............... (11,667) (46,444) (2,748) (675) 0
Net realized gains
Class I................ (24,379,441) (187,467,729) (20,189,344) (48,438,597) (21,267,232)
Class IS............... (36,122) (3,188,973) (52,325) (54,463) (852)
- -----------------------------------------------------------------------------------------------------
Total distributions to
shareholders.......... (36,477,492) (196,571,384) (22,091,706) (49,522,271) (21,269,288)
- -----------------------------------------------------------------------------------------------------
Capital shares
transactions
Proceeds from shares
sold.................. 40,891,177 134,132,114 17,963,149 3,355,140 45,503,515
Payment for shares
redeemed.............. (205,272,716) (336,210,264) (113,950,665) (106,922,322) (185,887,007)
Net asset value of
shares issued in
reinvestment of
distributions......... 31,025,679 188,873,735 19,603,608 48,546,755 21,268,857
Net asset value of
shares issued in
acquisition of common
trust funds........... 88,725,755 662,110,336 0 0 750,366,912
Net asset value of
shares issued in
acquisition of other
investment companies.. 0 132,358,403 0 0 0
- -----------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from capital
shares transactions... (44,630,105) 781,264,324 (76,383,908) (55,020,427) 631,252,277
- -----------------------------------------------------------------------------------------------------
Total increase
(decrease) in net
assets............... (12,939,304) 774,941,224 (63,186,196) (94,109,120) 905,178,286
Net assets
Beginning of period.... 659,137,807 1,943,722,912 607,738,783 438,756,964 40,129,017
- -----------------------------------------------------------------------------------------------------
End of period.......... $ 646,198,503 $2,718,664,136 $ 544,552,587 $ 344,647,844 $ 945,307,303
- -----------------------------------------------------------------------------------------------------
Undistributed
(overdistributed) net
investment income or
loss................... $ (67,625) $ 807,508 $ 42,516 $ 5,027 $ (642,815)
- -----------------------------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
72
<PAGE>
EVERGREEN
Select Equity Funds
Statements of Changes in Net Assets
Six Months Ended December 31, 1999 (Unaudited)
<TABLE>
<CAPTION>
Small Cap Small Company Social Strategic Strategic
Growth Value Principles Growth Value
Fund Fund Fund Fund Fund
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operations
Net investment income
or loss............... $ (220,306) $ 203,073 $ 206,339 $ 149,970 $ 3,921,710
Net realized gains or
losses on securities
and futures
contracts............. 7,724,216 (8,869,649) 13,379,755 73,538,856 9,684,294
Net change in
unrealized gains or
losses on securities
and futures
contracts............. 27,399,552 2,639,016 (9,293,541) 139,358,357 (22,587,449)
- -------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from
operations............ 34,903,462 (6,027,560) 4,292,553 213,047,183 (8,981,445)
- -------------------------------------------------------------------------------------------------
Distributions to
shareholders from
Net investment income
Class I................ 0 (211,134) (195,048) (230,950) (4,801,884)
Class IS............... 0 (14) (78) (1,380) (15,067)
Net realized gains
Class I................ 0 0 (24,231,940) (97,463,054) (9,327,347)
Class IS............... 0 0 (11,316) (2,592,736) (31,597)
- -------------------------------------------------------------------------------------------------
Total distributions to
shareholders.......... 0 (211,148) (24,438,382) (100,288,120) (14,175,895)
- -------------------------------------------------------------------------------------------------
Capital shares
transactions
Proceeds from shares
sold.................. 14,763,891 14,916,520 1,477,125 134,798,995 149,769,345
Payment for shares
redeemed.............. (8,287,289) (31,914,652) (33,457,584) (112,639,967) (61,089,469)
Net asset value of
shares issued in
reinvestment of
distributions......... 0 171,172 24,253,188 99,760,812 11,366,456
Net asset value of
shares issued in
acquisition of common
trust funds........... 0 0 0 2,592,329 153,449,048
Net asset value of
shares issued in
acquisition of other
investment companies.. 0 0 0 0 0
- -------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from capital
shares transactions... 6,476,602 (16,826,960) (7,727,271) 124,512,169 253,495,380
- -------------------------------------------------------------------------------------------------
Total increase
(decrease) in net
assets............... 41,380,064 (23,065,668) (27,873,100) 237,271,232 230,338,040
Net assets
Beginning of period.... 70,113,537 108,181,122 134,536,025 493,769,324 532,805,514
- -------------------------------------------------------------------------------------------------
End of period.......... $111,493,601 $ 85,115,454 $106,662,925 $ 731,040,556 $763,143,554
- -------------------------------------------------------------------------------------------------
Undistributed
(overdistributed) net
investment income or
loss................... $ (220,306) $ (8,535) $ 9,227 $ (89,568) $ 42,890
- -------------------------------------------------------------------------------------------------
</TABLE>
See Combined Notes to Financial Statements.
73
<PAGE>
EVERGREEN
Select Equity Fund
Statements of Changes in Net Assets
Year Ended June 30, 1999
<TABLE>
<CAPTION>
Diversified Large Cap Secular
Balanced Core Equity Value Blend Growth
Fund Fund Fund Fund Fund (a)
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operations
Net investment income
or loss................ $ 23,946,017 $ 15,255,869 $ 5,814,173 $ 3,767,039 9,089
Net realized gains or
losses on securities
and futures
contracts.............. 928,390 190,887,254 17,372,195 35,527,151 (41,350)
Net change in
unrealized gains or
losses on securities
and futures
contracts.............. 12,500,436 (31,676,691) 23,916,181 (7,056,882) 648,999
- ---------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from
operations............. 37,374,843 174,466,432 47,102,549 32,237,308 616,738
- ---------------------------------------------------------------------------------------------------
Distributions to
shareholders from:
Net investment income
(b)
Class I............... (22,214,234) (14,533,736) (5,432,863) (415,801) (7,798)
Class IS.............. (71,558) (136,355) (6,977) (2,046) (1)
Class IC (c).......... 0 0 0 (3,330,655) 0
Net realized gains (b)
Class I............... (7,372,020) (160,679,308) (17,317,740) (1,886,318) 0
Class IS.............. (32,664) (2,314,062) (34,597) (32,097) 0
Class IC (c).......... 0 0 0 (50,651,105) 0
- ---------------------------------------------------------------------------------------------------
Total distributions
to shareholders...... (29,690,476) (177,663,461) (22,792,177) (56,318,022) (7,799)
- ---------------------------------------------------------------------------------------------------
Capital shares
transactions
Proceeds from shares
sold................... 107,820,701 194,557,250 67,508,083 46,937,384 39,940,669
Payment for shares
redeemed............... (200,572,408) (345,341,133) (303,364,284) (147,493,668) (425,994)
Net asset value of
shares issued in
reinvestment of
distributions.......... 20,140,059 127,043,887 21,722,516 51,527,385 5,403
Net asset value of
shares issued in
acquisition of other
investment companies... 0 0 0 0 0
- ---------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from capital
shares transactions.. (72,611,648) (23,739,996) (214,133,685) (49,028,899) 39,520,078
- ---------------------------------------------------------------------------------------------------
Total increase
(decrease) in net
assets................ (64,927,281) (26,937,025) (189,823,313) (73,109,613) 40,129,017
Net assets
Beginning of period..... 724,065,088 1,970,659,937 797,562,096 511,866,577 0
- ---------------------------------------------------------------------------------------------------
End of period........... $ 659,137,807 $1,943,722,912 $ 607,738,783 $ 438,756,964 $40,129,017
- ---------------------------------------------------------------------------------------------------
Undistributed
(overdistributed) net
investment income or
loss.................... $ 1,619,270 $ 56,683 $ 414,562 $ (8,169) $ 10,878
- ---------------------------------------------------------------------------------------------------
</TABLE>
(a) For the period from February 26, 1999 (commencement of Class operations) to
June 30, 1999.
(b) The Large Cap Blend Fund redesignated $240,950 (or $0.02 per share for
Classes I, IS and IC) distributions from net investment income declared af-
ter January 1, 1999, as capital gains distributions after January 1, 1999.
(c) On April 30, 1999, the IC shares of the Large Cap Blend Fund and Social
Principles Fund were converted to Class I shares. Shareholders of Class IC
shares became owners of that number of Class I shares having a net asset
value equal to the net asset value of their shares immediately prior to the
close of business on April 30, 1999. Class IC is the accounting survivor,
its operating results for the periods prior to April 30, 1999 have been
carried forward in these financial statements.
See Combined Notes to Financial Statements.
74
<PAGE>
EVERGREEN
Select Equity Funds
Statements of Changes in Net Assets
Year Ended June 30, 1999
<TABLE>
<CAPTION>
Small Cap Small Company Social Strategic Strategic
Growth Value Principles Growth Value
Fund Fund Fund Fund Fund
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operations
Net investment income
or loss............... $ (423,502) $ 253,866 $ 502,889 $ 1,061,817 $ 5,478,583
Net realized gains or
losses on securities
and futures
contracts............. (2,938,420) (8,481,510) 20,463,898 100,654,235 9,159,666
Net change in
unrealized gains or
losses on securities
and futures
contracts............. 6,375,643 2,615,130 (22,240,460) 51,252,431 24,194,498
- ------------------------------------------------------------------------------------------------
Net increase
(decrease)
in net assets
resulting from
operations.......... 3,013,721 (5,612,514) (1,273,673) 152,968,483 38,832,747
- ------------------------------------------------------------------------------------------------
Distributions to
shareholders from:
Net investment income
Class I.............. 0 (313,373) (78,008) (1,186,581) (4,545,875)
Class IS............. 0 0 (238) (10,641) (17,533)
Class IC (b)......... 0 0 (537,557) 0 0
Net realized gains
Class I.............. (100,814) (363,011) (157,473) (42,795,680) (7,731,471)
Class IS............. 0 0 (6,403) (947,111) (36,621)
Class IC (b)......... 0 0 (8,960,041) 0 0
- ------------------------------------------------------------------------------------------------
Total distributions
to shareholders...... (100,814) (676,384) (9,739,720) (44,940,013) (12,331,500)
- ------------------------------------------------------------------------------------------------
Capital shares
transactions
Proceeds from shares
sold.................. 3,242,108 49,048,796 14,856,248 98,098,328 281,161,395
Payment for shares
redeemed.............. (5,425,723) (12,850,016) (58,178,607) (282,527,098) (72,083,435)
Net asset value of
shares issued in
reinvestment of
distributions......... 100,757 624,439 9,074,037 40,521,982 8,705,914
Net asset value of
shares issued in
acquisition of other
investment companies.. 0 0 0 205,742,310 0
- ------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
resulting from capital
shares transactions... (2,082,858) 36,823,219 (34,248,322) 61,835,522 217,783,874
- ------------------------------------------------------------------------------------------------
Total increase
(decrease) in net
assets............. 830,049 30,534,321 (45,261,715) 169,863,992 244,285,121
Net assets
Beginning of period.... 69,283,488 77,646,801 179,797,740 323,905,332 288,520,393
- ------------------------------------------------------------------------------------------------
End of period.......... $70,113,537 $108,181,122 $134,536,025 $ 493,769,324 $532,805,514
================================================================================================
Undistributed
(overdistributed) net
investment income or
loss................... $ 0 $ (460) $ (1,986) $ (7,208) $ 938,131
===============================================================================================
</TABLE>
(a) For the period from February 26, 1999 (commencement of Class operations) to
June 30, 1999.
(b) On April 30, 1999, the IC shares of the Large Cap Blend Fund and Social
Principles Fund were converted to Class I shares. Shareholders of Class IC
shares became owners of that number of Class I shares having a net asset
value equal to the net asset value of their shares immediately prior to the
close of business on April 30, 1999. Class IC is the accounting survivor,
its operating results for the periods prior to April 30, 1999 have been
carried forward in these financial statements.
See Combined Notes to Financial Statements.
75
<PAGE>
Combined Notes to Financial Statements (Unaudited)
1. ORGANIZATION
The Evergreen Select Equity Funds consist of Evergreen Select Balanced Fund
("Balanced Fund"), Evergreen Select Core Equity Fund ("Core Equity Fund"), Ev-
ergreen Select Diversified Value Fund ("Diversified Value Fund"), Evergreen Se-
lect Large Cap Blend Fund ("Large Cap Blend Fund"), Evergreen Select Secular
Growth Fund ("Secular Growth Fund"), Evergreen Select Small Cap Growth Fund
("Small Cap Growth Fund"), Evergreen Select Small Company Value Fund ("Small
Company Value Fund"), Evergreen Select Social Principles Fund ("Social Princi-
ples Fund"), Evergreen Select Strategic Growth Fund ("Strategic Growth Fund")
and Evergreen Select Strategic Value Fund ("Strategic Value Fund"), (collec-
tively, the "Funds"). Each Fund is a diversified series of Evergreen Select Eq-
uity Trust, a Delaware business trust organized on September 18, 1997. The
Trust is an open-end management investment company registered under the Invest-
ment Company Act of 1940, as amended (the "1940 Act").
The Funds offer Institutional shares ("Class I ") and Institutional Service
shares ("Class IS"). Each Class of shares is sold without a front-end sales
charge or contingent deferred sales charge. Class IS shares pay an ongoing
service fee.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently fol-
lowed by the Funds in the preparation of their financial statements. The poli-
cies are in conformity with generally accepted accounting principles, which re-
quire management to make estimates and assumptions that affect amounts reported
herein. Actual results could differ from these estimates.
A. Valuation of Securities
Securities traded on a national securities exchange or included on the NASDAQ
National Market System ("NMS") are valued at the last reported sales price on
the exchange where primarily traded. Securities traded on an exchange or NMS
and other securities traded in the over-the-counter market for which there has
been no sale are valued at the mean between the last reported bid and asked
price.
Corporate bonds, U.S. government obligations, mortgage and other asset-backed
securities and other fixed-income securities are valued at prices provided by
an independent pricing service. In determining a price for normal institution-
al-size transactions, the pricing service uses methods based on market transac-
tions for comparable securities and analysis of various relationships between
similar securities, which are generally recognized by institutional traders.
Securities for which valuations are not readily available from an independent
pricing service (including restricted securities) are valued at fair value as
determined in good faith according to procedures established by the Board of
Trustees.
Mutual fund shares held as short-term investments are valued at net asset val-
ue.
Short-term investments with remaining maturities of 60 days or less at the time
of purchase are carried at amortized cost, which approximates market value.
B. Repurchase Agreements
Each Fund may invest in repurchase agreements. Securities pledged as collateral
for repurchase agreements are held by the custodian on the Fund's behalf. Col-
lateral for certain tri-party repurchase agreements is held at the
counterparty's custodian in a segregated account for the benefit of the Fund
and the counterparty. Each Fund monitors the adequacy of the collateral daily
and will require the seller to provide additional collateral in the event the
market value of the securities pledged falls below the carrying value of the
repurchase agreement, including accrued interest. Each Fund will only enter
into repurchase agreements with banks and other financial institutions, which
are deemed by the investment adviser to be creditworthy pursuant to guidelines
established by the Board of Trustees.
76
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
Pursuant to an exemptive order issued by the Securities and Exchange Commis-
sion, the Small Cap Growth Fund along with certain other Funds, managed by Ev-
ergreen Investment Management Company ("EIMC"), an indirect wholly owned sub-
sidiary of First Union National Bank ("FUNB"), may transfer uninvested cash
balances into a joint trading account. These balances are invested in one or
more repurchase agreements that are fully collateralized by U.S. Treasury
and/or federal agency obligations.
C. Futures Contracts
In order to gain exposure to or protect against changes in security values, the
Funds may buy and sell futures contracts.
The initial margin deposited with a broker when entering into a futures trans-
action is subsequently adjusted by daily payments or receipts ("variation mar-
gin") as the value of the contract changes. Such changes are recorded as
unrealized gains or losses. Realized gains or losses are recognized on closing
the contract.
Risks of entering into futures contracts include (i) the possibility of an il-
liquid market for the contract, (ii) the possibility that a change in the value
of the contract may not correlate with changes in the value of the underlying
instrument or index, and (iii) the credit risk that the other party will not
fulfill their obligations under the contract. Futures contracts also involve
elements of market risk in excess of the amount reflected in the Statements of
Assets and Liabilities.
D. Foreign Currency
The books and records of the Funds are maintained in United States (U.S.) dol-
lars. Foreign currency amounts are translated into U.S. dollars as follows:
market value of investments, other assets and liabilities at the daily rate of
exchange; purchases and sales of investments, income and expenses at the rate
of exchange prevailing on the respective dates of such transactions. Net
unrealized foreign exchange gain or loss resulting from changes in foreign cur-
rency exchange rates is a component of net unrealized gain or loss on securi-
ties and foreign currency related transactions. Net realized foreign currency
gains or losses resulting from changes in exchange rates include foreign cur-
rency gains and losses between trade date and settlement date on securities
transactions, foreign currency related transactions and the difference between
the amounts of interest and dividends recorded on the books of the Funds and
the amounts that are actually received are included in realized gain or loss on
foreign currency related transactions. The portion of foreign currency gains or
losses related to fluctuations in exchange rates between the initial purchase
trade date and subsequent sale trade date is included in realized gains or
losses on securities.
E. Securities Lending
In order to generate income and to offset expenses, the Funds may lend portfo-
lio securities to brokers, dealers, and other financial organizations. The
Funds' investment advisers will monitor the creditworthiness of such borrowers.
Loans of securities may not exceed 33 1/3% of a Fund's total assets and will be
collateralized by cash, letters of credit or U.S. Government securities that
are maintained at all times in an amount equal to at least 100% of the current
market value of the loaned securities, including accrued interest. The Fund
monitors the adequacy of the collateral daily and will require the borrower to
provide additional collateral in the event the value of the collateral falls
below 100% of the market value of the securities on loan. While such securities
are on loan, the borrower will pay a Fund any income accruing thereon, and the
Fund may invest any cash collateral received in portfolio securities, thereby
increasing its return. A Fund will have the right to call any such loan and ob-
tain the securities loaned at any time on five days' notice. Any gain or loss
in the market price of the loaned securities, which occurs during the term of
the loan, would affect a Fund and its investors. A Fund may pay fees in connec-
tion with such loans.
F. Security Transactions and Investment Income
Securities transactions are accounted for no later than one business day after
the trade date. Realized gains and losses are computed on an identified cost
basis. Interest income is recorded on the accrual basis and includes accretion
of discounts and amortization of premiums. Dividend income is recorded on the
ex-dividend date or
77
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
in the case of some foreign securities, on the date thereafter when the Fund is
made aware of the dividend. Income and capital gains realized on some foreign
securities may be subject to foreign taxes, which are accrued as applicable.
G. Federal Taxes
The Funds intend to continue to qualify as regulated investment companies under
the Internal Revenue Code of 1986, as amended ("Code"). Thus, the Funds will
not incur any federal income tax liability since they are expected to distrib-
ute all of their net investment company taxable income and net capital gains,
if any, to their shareholders. The Funds also intend to avoid any excise tax
liability by making the required distributions under the Code. Accordingly, no
provision for federal taxes is required. To the extent that realized capital
gains can be offset by capital loss carryforwards, it is each Fund's policy not
to distribute such gains.
H. Distributions
Distributions from net investment income, if any, for the Funds, except for
Small Cap Growth Fund, are declared and paid monthly. Small Cap Growth Fund de-
clares and pays distributions from net investment income, if any, annually.
Distributions from net realized capital gains, if any, are paid at least annu-
ally. Distributions to shareholders are recorded at the close of business on
the ex-dividend date.
Income and capital gains distributions to shareholders are determined in accor-
dance with income tax regulations, which may differ from generally accepted ac-
counting principles.
I. Class Allocations
Income, expenses (other than class specific expenses), and realized and
unrealized gains and losses are prorated among the classes based on the rela-
tive net assets of each class. Currently, class specific expenses are limited
to expenses incurred under the Distribution Plans.
J. Organization Expenses
Organization expenses for Small Cap Growth Fund are amortized to operations
over a five-year period on a straight-line basis. In the event any of the ini-
tial shares of the Fund are redeemed by any holder during the five-year amorti-
zation period, redemption proceeds will be reduced by any unamortized organiza-
tion expenses in the same proportion as the number of initial shares being re-
deemed bears to the number of initial shares outstanding at the time of the re-
demption.
3. INVESTMENT ADVISORY AGREEMENTS AND OTHER AFFILIATED TRANSACTIONS
The investment adviser to each Fund, other than Small Cap Growth Fund and Small
Company Value Fund is First Capital Group ("FCG"), a division of FUNB. Each
Fund, other than Small Cap Growth Fund and Small Company Value Fund, pays FCG a
fee for its services as set forth below. The annual advisory fees are calcu-
lated daily and paid monthly and are based on a percentage of the average daily
net assets of each Fund.
<TABLE>
<CAPTION>
Annual
Advisory fee
------------
<S> <C>
Balanced Fund....................................... 0.60%
Core Equity Fund.................................... 0.70
Diversified Value Fund.............................. 0.60
Large Cap Blend Fund................................ 0.70
Secular Growth Fund................................. 0.70
Social Principles Fund.............................. 0.80
Strategic Growth Fund............................... 0.70
Strategic Value Fund................................ 0.70
</TABLE>
EIMC is the investment adviser to Small Cap Growth Fund. In return for its
services, EIMC is paid an annual advisory fee equal to 0.80% of the Fund's
first $100 million of average daily net assets, 0.75% of the Fund's next $150
million, and 0.65% thereafter.
Evergreen Asset Management Corp. ("EAMC"), a wholly-owned subsidiary of FUNB,
is the investment adviser to Small Company Value Fund. Small Company Value Fund
pays EAMC an annual fee of 0.90% of its average daily net assets. Leiber & Com-
pany, an affiliate of First Union Corporation ("First Union"), is the invest-
ment
78
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
sub-adviser to Small Company Value Fund. Leiber & Company provides these serv-
ices at no additional cost to the Fund.
Leiber & Company also provides brokerage services to Small Company Value Fund
with respect to substantially all security transactions effected on either the
New York or American Stock Exchanges. For the six months ended December 31,
1999, Small Company Fund incurred $91,862, in brokerage commissions with Leiber
& Company.
Each investment adviser, other than EIMC, has voluntarily agreed to waive a
portion of the investment advisory fee for each Fund and/or to reimburse a por-
tion of each Fund's annual operating expenses. For the six months ended Decem-
ber 31, 1999, the investment advisers voluntarily reduced their fees as fol-
lows:
<TABLE>
<CAPTION>
Total % of Average
Fee Daily Net Assets
Waivers (annualized)
-------- ----------------
<S> <C> <C>
Balanced Fund......................... $339,262 0.10%
Core Equity Fund...................... 924,281 0.07
Diversified Value Fund................ 263,730 0.09
Large Cap Blend Fund.................. 171,420 0.09
Secular Growth Fund................... 425,608 0.12
Small Company Value Fund.............. 37,167 0.07
Social Principles Fund................ 31,950 0.06
Strategic Growth Fund................. 168,384 0.06
Strategic Value Fund.................. 196,718 0.06
</TABLE>
Evergreen Investment Services ("EIS"), an indirect wholly-owned subsidiary of
First Union, is the administrator and The BISYS Group, Inc. ("BISYS") serves as
sub-administrator to the Funds. As administrator, EIS provides the Funds with
facilities, equipment and personnel. As sub-administrator to the Funds, BISYS
provides the officers of the Funds. Officers of the Funds and affiliated Trust-
ees receive no compensation directly from the Funds.
The administrator and sub-administrator for each Fund, except Small Cap Growth
Fund, are entitled to an annual fee based on the average daily net assets of
the Funds administered by EIS for which First Union or its investment advisory
subsidiaries are also the investment advisors. The administration fee is calcu-
lated by applying percentage rates, which start at 0.05% and decline to 0.01%
per annum as net assets increase, to the average daily net assets of each Fund.
The sub-administration fee is calculated by applying percentage rates, which
start at 0.01% and decline to 0.004% per annum as net assets increase, to the
average daily net assets of each Fund.
For the six months ended December 31, 1999, the following amounts were paid for
administration and sub-administration services:
<TABLE>
<CAPTION>
Administration Sub-administration
-------------- ------------------
<S> <C> <C>
Balanced Fund................. $ 60,439 $16,682
Core Equity Fund.............. 225,369 62,246
Diversified Value Fund........ 49,773 13,705
Large Cap Blend Fund.......... 34,654 9,561
Secular Growth Fund........... 64,495 17,845
Small Company Value Fund...... 8,917 2,460
Social Principles Fund........ 10,045 2,771
Strategic Growth Fund......... 50,003 13,813
Strategic Value Fund.......... 61,144 16,889
</TABLE>
For the Small Cap Growth Fund, the sub-administration fee is paid by the in-
vestment advisor and is not a Fund expense. For the six months ended December
31, 1999, Small Cap Growth Fund reimbursed EIMC for certain administrative and
accounting expenses amounting to $4,743.
Evergreen Service Company ("ESC"), an indirect, wholly-owned subsidiary of
FUNB, serves as the transfer and dividend disbursing agent for the Funds.
79
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
4. DISTRIBUTION PLANS
Evergreen Distributor, Inc. ("EDI"), a wholly-owned subsidiary of BISYS, serves
as principal underwriter to the Funds. Each Fund has adopted a Distribution
Plan for Class IS shares, as allowed by Rule 12b-1 of the 1940 Act. Distribu-
tion Plans permit each Fund to reimburse its principal underwriter for costs
related to selling shares of the Fund and for various other services. These
costs, which consist primarily of commissions and service fees to broker-deal-
ers who sell shares of the Fund, are paid by the Fund through "Distribution
Plan expenses". Class IS currently pays a service fee equal to 0.25% of the av-
erage daily net asset of the class. Distribution Plan expenses are calculated
daily and paid at least quarterly.
Each of the Distribution Plans may be terminated at any time by vote of the In-
dependent Trustees or by vote of a majority of the outstanding voting shares of
the respective class.
5. CAPITAL SHARE TRANSACTIONS
The Funds have an unlimited number of shares of beneficial interest with $0.001
par value authorized. Shares of beneficial interest of the Funds are currently
divided into Class I and/or Class IS. Transactions in shares of the Funds were
as follows:
Balanced Fund
<TABLE>
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999
-------------------------- --------------------------
Shares Amount Shares Amount
- --------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold............. 2,981,652 $ 40,024,793 7,848,229 $ 102,258,212
Shares redeemed......... (15,227,946) (204,969,515) (14,836,155) (195,030,850)
Shares issued in
reinvestment of
distributions.......... 2,255,529 31,015,930 1,521,793 20,036,612
Shares issued in
acquisition of:
Corestates Balanced
Fund.................. 422,321 5,780,695 0 0
Corestates Balanced
Trust................. 6,059,738 82,945,060 0 0
- --------------------------------------------------------------------------------
Net decrease............ (3,508,706) (45,203,037) (5,466,133) (72,736,026)
- --------------------------------------------------------------------------------
Class IS Shares
Shares sold............. 64,826 866,384 422,203 5,562,489
Shares redeemed......... (23,063) (303,201) (416,181) (5,541,558)
Shares issued in
reinvestment of
distributions.......... 716 9,749 7,749 103,447
- --------------------------------------------------------------------------------
Net increase............ 42,479 572,932 13,771 124,378
- --------------------------------------------------------------------------------
Net decrease............ $ (44,630,105) $ (72,611,648)
- --------------------------------------------------------------------------------
</TABLE>
Core Equity Fund
<TABLE>
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999
------------------------- -------------------------
Shares Amount Shares Amount
- ------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold............. 1,245,614 $ 101,898,840 1,894,587 $ 162,933,860
Shares redeemed......... (3,828,357) (318,348,019) (3,733,442) (323,280,104)
Shares issued in
reinvestment of
distributions.......... 2,198,590 186,527,155 1,482,376 125,141,384
Shares issued in
acquisition of common
trust funds:
Corestates Growth and
Income Equity Trust... 6,974,611 595,233,256 0 0
Signet Capital Growth.. 67,230 5,737,565 0 0
Signet Investors Equity
Class A............... 592,625 50,576,342 0 0
Signet Investors Equity
Class B............... 123,773 10,563,173 0 0
Shares issued in
acquisition of other
investment companies:
Evergreen Select Equity
Income Fund........... 1,629,831 132,135,902 0 0
- ------------------------------------------------------------------------------
Net increase
(decrease)............. 9,003,917 764,324,214 (356,479) (35,204,860)
- ------------------------------------------------------------------------------
Class IS Shares
Shares sold............. 405,508 32,233,274 388,096 31,623,390
Shares redeemed......... (231,505) (17,862,245) (271,386) (22,061,029)
Shares issued in
reinvestment of
distributions.......... 29,717 2,346,580 24,042 1,902,503
Shares issued in
acquisition of other
investment companies:
Evergreen Select Equity
Income Fund........... 14,454 222,501 0 0
- ------------------------------------------------------------------------------
Net increase............ 218,174 16,940,110 140,752 11,464,864
- ------------------------------------------------------------------------------
Net increase
(decrease)............. $ 781,264,324 $ (23,739,996)
- ------------------------------------------------------------------------------
</TABLE>
80
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
Diversified Value Fund
<TABLE>
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999
------------------------- --------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold............. 667,054 $ 17,962,659 2,710,532 $ 66,392,052
Shares redeemed......... (4,210,637) (113,886,974) (12,054,441) (303,229,194)
Shares issued in
reinvestment of
distributions.......... 713,363 19,548,535 864,540 21,680,943
- -------------------------------------------------------------------------------
Net decrease............ (2,830,220) (76,375,780) (8,479,369) (215,156,199)
- -------------------------------------------------------------------------------
Class IS Shares
Shares sold............. 19 490 46,088 1,116,031
Shares redeemed......... (2,397) (63,691) (5,221) (135,090)
Shares issued in
reinvestment of
distributions.......... 2,035 55,073 1,677 41,573
- -------------------------------------------------------------------------------
Net increase
(decrease)............. (343) (8,128) 42,544 1,022,514
- -------------------------------------------------------------------------------
Net decrease............ $ (76,383,908) $(214,133,685)
- -------------------------------------------------------------------------------
Large Cap Blend Fund
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999
------------------------- --------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold............. 70,831 $ 3,269,982 281,613 $ 13,021,813
Shares redeemed......... (2,327,772) (106,874,822) (1,136,453) (53,049,940)
Shares issued in
reinvestment of
distributions.......... 1,139,002 48,491,624 40,730 1,853,814
Shares issued from
conversion of Class IC
(a).................... 0 0 9,604,208 452,516,632
- -------------------------------------------------------------------------------
Net increase
(decrease)............. (1,117,939) (55,113,216) 8,790,098 414,342,319
- -------------------------------------------------------------------------------
Class IS Shares
Shares sold............. 1,764 85,158 7,147 328,082
Shares redeemed......... (1,048) (47,500) (5,917) (269,541)
Shares issued in
reinvestment of
distributions.......... 1,295 55,131 745 33,874
- -------------------------------------------------------------------------------
Net increase............ 2,011 92,789 1,975 92,415
- -------------------------------------------------------------------------------
Class IC Shares
Shares sold............. 0 0 745,024 33,587,489
Shares redeemed......... 0 0 (2,036,907) (94,174,187)
Shares issued in
reinvestment of
distributions.......... 0 0 1,090,492 49,639,697
Shares converted in
conversion to Class I
(a).................... 0 0 (9,604,208) (452,516,632)
- -------------------------------------------------------------------------------
Net decrease............ 0 0 (9,805,599) (463,463,633)
- -------------------------------------------------------------------------------
Net decrease............ $ (55,020,427) $ (49,028,899)
- -------------------------------------------------------------------------------
(a) On April 30, 1999, Class IC shares of the Fund were converted to Class I
shares.
Secular Growth Fund
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999 (b)
------------------------- --------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold............. 422,480 $ 45,437,073 405,610 $ 39,939,701
Shares redeemed......... (1,739,289) (185,887,007) (4,346) (425,994)
Shares issued in
reinvestment of
distributions.......... 158,837 21,268,005 54 5,402
Shares issued in
acquisition of:
Corestate Charitable
Equity Trust.......... 1,069,362 110,877,230 0 0
Corestate Growth and
Income Fund........... 787,473 81,649,376 0 0
Corestate Growth Equity
Fund.................. 4,185,687 433,994,394 0 0
Corestate Growth Equity
Trust................. 1,194,440 123,845,912 0 0
- -------------------------------------------------------------------------------
Net increase............ 6,078,990 631,184,983 401,318 39,519,109
- -------------------------------------------------------------------------------
Class IS Shares
Shares sold............. 540 66,442 10 968
Shares issued in
reinvestment of
distributions.......... 6 852 0 1
- -------------------------------------------------------------------------------
Net increase............ 546 67,294 10 969
- -------------------------------------------------------------------------------
Net increase............ $ 631,252,277 $ 39,520,078
- -------------------------------------------------------------------------------
</TABLE>
(b) For the period from February 26, 1999 (commencement of class operations) to
June 30, 1999.
81
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
Small Cap Growth Fund
<TABLE>
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999
------------------------ -------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold.............. 966,368 $ 14,763,891 284,105 $ 3,242,108
Shares redeemed.......... (513,615) (8,287,289) (437,071) (5,425,723)
Shares issued in
reinvestment of
distributions........... 0 0 8,734 100,757
- -------------------------------------------------------------------------------
Net increase (decrease).. $ 6,476,602 $ (2,082,858)
- -------------------------------------------------------------------------------
Small Company Value Fund
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999 (a)
------------------------ -------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold.............. 1,763,607 $ 14,896,899 5,762,869 $ 48,213,008
Shares redeemed.......... (3,845,627) (31,896,066) (1,437,069) (12,034,887)
Shares issued in
reinvestment of
distributions........... 20,589 171,171 74,799 624,337
- -------------------------------------------------------------------------------
Net increase (decrease).. (2,061,431) (16,827,996) 4,400,599 36,802,458
- -------------------------------------------------------------------------------
Class IS Shares
Shares sold.............. 2,472 19,621 101,492 835,890
Shares redeemed.......... (2,472) (18,586) (101,371) (815,129)
Shares issued in
reinvestment of
distributions........... 0 1 0 0
- -------------------------------------------------------------------------------
Net increase............. 0 1,036 121 20,761
- -------------------------------------------------------------------------------
Net increase (decrease).. $(16,826,960) $ 36,823,219
- -------------------------------------------------------------------------------
(a) For Class IS, for the period from December 31, 1998 (commencement of class
operations) to June 30, 1999.
Social Principles Fund
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999
------------------------ -------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold.............. 38,075 $ 1,335,750 90,138 $ 3,145,258
Shares redeemed.......... (975,019) (33,321,195) (225,918) (8,155,311)
Shares issued in
reinvestment of
distributions........... 872,243 24,241,794 4,705 162,875
Shares issued from
conversion of Class IC
(b)..................... 0 0 3,712,810 126,994,084
- -------------------------------------------------------------------------------
Net increase (decrease) (64,701) (7,743,651) 3,581,735 122,146,906
- -------------------------------------------------------------------------------
Class IS Shares
Shares sold.............. 3,710 141,375 4,670 159,277
Shares redeemed.......... (3,994) (136,389) (8,520) (297,123)
Shares issued in
reinvestment of
distributions........... 410 11,394 191 6,618
- -------------------------------------------------------------------------------
Net increase (decrease) 126 16,380 (3,659) (131,228)
- -------------------------------------------------------------------------------
Class IC Shares
Shares sold.............. 0 0 337,062 11,551,713
Shares redeemed.......... 0 0 (1,429,917) (49,726,173)
Shares issued in
reinvestment of
distributions........... 0 0 256,850 8,904,544
Shares converted in
conversion to Class I
(b)..................... 0 0 (3,712,810) (126,994,084)
- -------------------------------------------------------------------------------
Net decrease............. 0 0 (4,548,815) (156,264,000)
- -------------------------------------------------------------------------------
Net decrease............. $ (7,727,271) $ (34,248,322)
- -------------------------------------------------------------------------------
</TABLE>
(b) On April 30, 1999, Class IC shares of the Fund were converted to Class I
shares.
82
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
Strategic Growth Fund
<TABLE>
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999
------------------------- ------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold.............. 3,286,506 $ 132,246,666 4,260,240 $ 93,242,573
Shares redeemed.......... (2,699,718) (110,488,146) (7,535,767) (27,683,495)
Shares issued in
reinvestment of
distributions........... 2,502,797 97,529,865 1,078,559 39,578,816
Shares issued in
acquisition of:
CoreFund Equity Growth
Fund................... 0 0 5,297,535 198,759,540
Corestate Union County
Equity Trust........... 70,063 2,592,329 0 0
- -------------------------------------------------------------------------------
Net increase (decrease).. 3,159,648 121,880,714 (2,196,968) 105,137,894
- -------------------------------------------------------------------------------
Class IS Shares
Shares sold.............. 62,818 2,552,329 130,363 4,855,755
Shares redeemed.......... (51,663) (2,151,821) (101,906) (3,843,603)
Shares issued in
reinvestment of
distributions........... 57,523 2,230,947 25,744 943,166
Shares issued in
acquisition of other
investment companies:
CoreFund Equity Growth
Fund................... 0 0 186,381 6,982,770
- -------------------------------------------------------------------------------
Net increase............. 68,678 2,631,455 240,582 8,938,088
- -------------------------------------------------------------------------------
Net increase............. $ 124,512,169 $114,075,982
- -------------------------------------------------------------------------------
Strategic Value Fund
<CAPTION>
Six Months Ended Year Ended
December 31, 1999 June 30, 1999
------------------------- ------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class I Shares
Shares sold.............. 679,428 $ 147,447,248 1,250,078 $278,450,304
Shares redeemed.......... (269,283) (59,956,731) (322,534) (69,617,033)
Shares issued in
reinvestment of
distributions........... 48,721 11,332,741 40,648 8,661,803
Shares issued in
acquisition of:
Corestate Value Equity
Fund................... 341,237 80,405,690 0 0
Corestate Value Equity
Trust.................. 309,990 73,043,358 0 0
- -------------------------------------------------------------------------------
Net increase............. 1,110,093 252,272,306 968,192 217,495,074
- -------------------------------------------------------------------------------
Class IS Shares
Shares sold.............. 10,545 2,322,097 12,671 2,711,091
Shares redeemed.......... (5,184) (1,132,738) (11,118) (2,466,402)
Shares issued in
reinvestment of
distributions........... 146 33,715 208 44,111
- -------------------------------------------------------------------------------
Net increase............. 5,507 1,223,074 1,761 288,800
- -------------------------------------------------------------------------------
Net increase............. $ 253,495,380 $217,783,874
- -------------------------------------------------------------------------------
</TABLE>
6. SECURITIES TRANSACTIONS
Cost of purchases and proceeds from sales of investment securities (excluding
short-term investments and securities acquired as a result of conversions, and
acquisitions) were as follows for the six months ended December 31, 1999:
<TABLE>
<CAPTION>
Cost of Proceeds
Purchases from Sales
-------------------------
<S> <C> <C>
Core Equity Fund...................... $120,541,671 $588,753,126
Diversified Value Fund................ 125,088,361 263,382,043
Large Cap Blend Fund.................. 40,151,264 143,169,297
Secular Growth Fund................... 312,337,035 542,179,490
Small Cap Growth Fund................. 104,735,131 99,529,670
Small Company Value Fund.............. 44,323,600 58,989,786
Social Principles Fund................ 22,206,666 53,019,421
Strategic Growth Fund................. 394,068,724 375,799,641
Strategic Value Fund.................. 217,487,466 137,641,661
</TABLE>
For the Balanced Fund, cost of purchases of U.S. government and non-U.S. gov-
ernment securities was $198,177,676 and $375,838,856, respectively, and the
Fund's proceeds from sale of U.S. government and non-U.S. government securities
was $274,808,328 and $460,776,227, respectively, for the six months ended
December 31, 1999.
83
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
The Secular Growth Fund and Small Cap Growth Fund loaned securities during the
six months ended December 31, 1999 to certain brokers who paid the Funds a ne-
gotiated lenders' fee. During the six months ended December 31, 1999, the Funds
earned $196,594 and $48,178, respectively in income from securities lending. As
of December 31, 1999 the value of the Small Cap Growth Fund's securities on
loan and the value of collateral amounted to $25,999,749 and $26,219,817, re-
spectively.
As of June 30, 1999, Small Cap Growth Fund had a capital loss carryover for
federal income tax purposes of $1,348,498 expiring in 2006 and $2,891,216 ex-
piring in 2007 and Small Company Value Fund had a capital loss carryover for
federal income tax purposes of $3,027,415 expiring in 2007.
In addition to the capital loss carryovers, capital losses incurred by the
Funds after October 31, within the Funds' fiscal year, are deemed to arise on
the first business day of the Funds' following fiscal year. For the year ended
June 30, 1999 the Small Company Value Fund incurred and elected to defer
$5,497,097 of such post-October losses.
7. CONVERSION INFORMATION
On July 9, 1999, Balanced Fund, Core Equity Fund, Secular Growth Fund, Strate-
gic Growth Fund and Strategic Value Fund (collectively "Acquiring Evergreen
Funds") acquired substantially all of the net assets and identified liabilities
of certain common trust funds managed by FUNB into the Acquiring Evergreen
Funds. The net assets, consisting primarily of portfolio securities, were ac-
quired either through a taxable or tax-free exchange for Class I shares of the
Acquiring Evergreen Funds.
The following summarizes pertinent data related to the Funds on the date of the
acquisition:
<TABLE>
<CAPTION>
Evergreen
Acquiring Total Total Net Fund Unrealized
Evergreen Shares Assets NAV/share Appreciation
Fund Common Trust Fund Issued Acquired Class I of Securities
---------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Balanced CoreStates Balanced
Fund Fund 422,321 $ 5,780,695 $ 13.68 $ 0
CoreStates Balanced
Trust 6,059,738 82,945,060 20,569,515
--------- ------------ ------------
Total 6,482,059 88,725,755 20,569,515
========= ============ ============
Core
Equity CoreStates Growth and
Fund Income Equity Trust 6,974,611 595,233,256 $ 85.34 134,355,837
Signet Capital Growth 67,230 5,737,565 3,701,178
Signet Investors
Equity Class A 592,625 50,576,342 36,302,394
Signet Investors
Equity Class B 123,773 10,563,173 7,475,528
--------- ------------ ------------
Total 7,758,239 662,110,336 181,834,937
========= ============ ============
Secular
Growth CoreStates Charitable
Fund Equity Trust 1,069,362 110,877,230 $103.69 31,871,390
CoreStates Growth and
Income Fund 787,473 81,649,376 0
CoreStates Growth
Equity Fund 4,185,687 433,994,394 0
CoreStates Growth
Equity Trust 1,194,440 123,845,912 36,115,475
--------- ------------ ------------
Total 7,236,962 750,366,912 67,986,865
========= ============ ============
Strategic
Growth CoreStates Union
Fund County Equity Trust 70,063 2,592,329 $ 37.00 1,356,557
--------- ------------ ------------
Strategic
Value CoreStates Value
Fund Equity Fund 341,237 80,405,690 $235.63 0
CoreStates Value
Equity Trust 309,990 73,043,358 11,453,813
--------- ------------ ------------
Total 651,227 $153,449,048 $ 11,453,813
========= ============ ============
</TABLE>
The above amounts are reflected in the Statements of Changes in Net Assets for
the six months ended December 31, 1999.
84
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
8. CLASS IC CONVERSION
On April 30, 1999, the Large Cap Blend Fund and Social Principles Fund con-
verted their respective Class IC shares to Class I shares. Shareholders of
Class IC shares became owners of that number of Class I shares having a net as-
set value equal to the net asset value of their shares immediately prior to the
close of business April 30, 1999. Since Class IC shares contributed the major-
ity of the net assets and the shareholders to the newly combined Class I, the
Class IC and its operating results for prior periods are carried forward as the
accounting survivor. The following chart summarizes pertinent data related to
each Fund's Class IC shares on the date of conversion:
<TABLE>
<CAPTION>
Social
Large Cap Principles
Blend Fund Fund
-----------------------------------------------------------------
<S> <C> <C>
Class I shares issued................. 9,604,208 3,712,810
Net assets of Class IC................ $452,516,632 $126,994,084
Net asset value of Class I per share.. $ 47.12 $ 34.20
</TABLE>
9. ACQUISITIONS
Effective the close of business on July 30, 1999, Core Equity Fund acquired the
net assets and liabilities of Evergreen Select Equity Income Fund, an open-end
management investment company registered under the 1940 Act in an exchange of
shares. The net assets were exchanged through a tax-free exchange of 14,454
Class IS shares and 1,629,831 Class I shares of Core Equity Fund. The acquired
net assets consisted primarily of portfolio securities with unrealized appreci-
ation of $15,463,739. Aggregate net assets of Core Equity Fund and Evergreen
Select Equity Income Fund immediately before the acquisition were
$2,449,655,426 and $132,358,403, respectively. The aggregate net assets of Core
Equity Fund after the acquisition were $2,582,013,829. The above amounts are
reflected in both the Statements of Changes in Net Assets and Capital Shares
Transactions for the six months ended December 31, 1999.
Effective the close of business on July 24, 1998, Strategic Growth Fund ac-
quired the net assets of CoreFund Equity Growth Fund, an open-end management
investment company registered under the 1940 Act in an exchange of shares. The
net assets were exchanged through a tax-free exchange for 186,381 Class IS
shares and 5,297,535 Class I shares of Strategic Growth Fund. The acquired net
assets consisted primarily of portfolio securities with unrealized appreciation
of $66,587,357. The aggregate net assets of CoreFund Equity Growth Fund and
Strategic Growth Fund immediately before the acquisition were $205,742,310 and
$326,300,095, respectively. The aggregate net assets of Strategic Growth Fund
after the acquisition were $532,042,405. The above amounts are reflected in
proceeds from shares sold in both the Statements of Changes in Net Assets and
Capital Shares Transactions for the year ended June 30, 1999.
10. EXPENSE REDUCTIONS
The Funds have entered into an expense reduction arrangements with ESC and
their custodian whereby credits realized as a result of uninvested cash bal-
ances were used to reduce a portion of each Fund's related expenses. The assets
deposited with ESC and the custodian under these expense reduction arrangements
could have been invested in income-producing assets. The amount of expense re-
ductions received by each Fund and the impact on each Fund's expense ratio rep-
resented as a percentage of its average daily net assets were as follows:
<TABLE>
<CAPTION>
% of Average
Expense Daily Net Assets
Reductions (annualized)
----------------------------------------------------------------
<S> <C> <C>
Balanced Fund....................... $13,487 .00%
Core Equity Fund.................... 52,784 .00
Diversified Value Fund.............. 11,480 .00
Large Cap Blend Fund................ 8,152 .00
Secular Growth Fund................. 14,080 .00
Small Cap Growth Fund............... 3,478 .01
Small Company Fund.................. 3,970 .01
Social Principles Fund.............. 1,966 .00
Strategic Growth Fund............... 12,865 .00
Strategic Value Fund ............... 14,164 .00
</TABLE>
85
<PAGE>
Combined Notes to Financial Statements (Unaudited) (continued)
11. DEFERRED TRUSTEES' FEES
Each Independent Trustee of the Funds may defer any or all compensation related
to performance of their duties as Trustees. The Trustees' deferred balances are
allocated to deferral accounts, which are included in the accrued expenses for
the Fund. The investment performance of the deferral accounts are based on the
investment performance of certain Evergreen Funds. Any gains earned or losses
incurred in the deferral accounts are reported in the Fund's Trustees' fees and
expenses. At the election of the Trustees, the deferral account will be paid
either in one lump sum or in quarterly installments for up to ten years.
12. FINANCING AGREEMENTS
Certain Evergreen Funds, State Street Bank and Trust Company ("State Street")
and Bank of New York ("BONY") entered into a renewed financing agreement dated
December 22, 1998. Under this agreement, the State Street and BONY provided an
unsecured credit facility in the aggregate amount of $150 million ($125 million
committed and $25 million uncommitted). The credit facility was allocated, un-
der the terms of the financing agreement, between the Banks. The credit facil-
ity was accessed by the Funds for temporary or emergency purposes only and was
subject to each Fund's borrowing restrictions. Borrowings under this facility
bore interest at 0.50% per annum above the Federal Funds rate. A commitment fee
of 0.065% per annum was incurred on the unused portion of the committed facili-
ty, which will be allocated to all funds. This agreement was terminated on July
27, 1999.
On July 27, 1999, all of the Evergreen Funds and a group of banks (the "Lend-
ers") entered into a credit agreement. Under this agreement, the Lenders pro-
vided an unsecured revolving credit commitment in the aggregate amount of
$1.050 billion. The credit facility is allocated, under the terms of the fi-
nancing agreement, among the Lenders. The credit facility is accessed by the
Evergreen Funds for temporary of emergency purposes to fund the redemption of
their shares or a general working capital as permitted by each Fund's borrowing
restrictions. Borrowings under this facility bear interest at 0.75% per annum
above the Federal Funds rate (1.50% per annum above the Federal Funds rate dur-
ing the period from and including December 1, 1999 through and including Janu-
ary 31, 2000). A commitment fee of 0.10% per annum is incurred on the average
daily unused portion of the revolving credit agreement. The commitment fee is
allocated to all Evergreen Funds. For its assistance in arranging this financ-
ing agreement, First Union Capital Markets Corp. was paid a one-time arrange-
ment fee of $250,000. State Street serves as paying agent for the Funds and as
paying agent is entitled to a fee of $20,000 per annum, which is allocated to
all the Evergreen Funds.
During the six months ended December 31, 1999 the Funds had no significant bor-
rowing under the financing agreements.
13. CONCENTRATION RISK
The Funds may invest a substantial portion of its assets in an industry or sec-
tor and, therefore, may be more affected by changes in that industry or sector
than would be a comparable mutual fund that is not heavily weighed in any in-
dustry or sector.
86
<PAGE>
Evergreen Select Funds*
Money Market
Money Market Fund
Treasury Money Market Fund
100% Treasury Money Market Fund
Municipal Money Market Fund
U.S. Government Money Market Fund
Municipal Fixed
Income
Intermediate Term Municipal Bond Fund
Taxable Fixed
Income
International Bond Fund
Total Return Bond Fund
Income Plus Fund
Core Bond Fund
Fixed Income Fund
Fixed Income Fund II
Adjustable Rate Fund
Limited Duration Fund
Growth and Income/
Balanced
Balanced Fund
Growth
Special Equity Fund
Small Cap Growth Fund
Small Company Value Fund
Strategic Growth Fund
Core Equity Fund
Equity Index Fund
Large Cap Blend Fund
Strategic Value Fund
Diversified Value Fund
Social Principles Fund
Secular Growth Fund
* Minimum investment in an Evergreen Select Fund is $1,000,000.
57803 542780 2/2000
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PRSRT STD
U.S. POSTAGE
PAID
HUDSON, MA
PERMIT NO. 19
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[LOGO OF EVERGREEN FUNDS]
200 Berkeley Street
Boston, MA 02116
